SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20005
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report - December 8, 1999
(Date of earliest event reported)
Questar Gas Company
(Exact name of registrant as specified in charter)
STATE OF UTAH 1-935 87-0407509
(State or other juris- (Commission (I.R.S. Employer
diction of incorporation File No.) Identification No.)
or organization)
180 East 100 South Street, P.O. Box 45360, Salt Lake City, Utah 84145-0360
(Address of principal executive offices)
Registrant's telephone number, including area code (801) 324-5555
FORM 8-K
CURRENT REPORT
Item 5. Other Events.
The Public Service Commission of Utah (PSCU) has denied Questar Gas
Company's (Questar Gas or the Company) request to recover in the Company's
semiannual pass-through rate filing the cost of removing CO2 from gas processed
at a new plant near Price, Utah. Some of the natural gas Questar Gas delivers
to its customers must be processed to remove CO2, ensuring a natural gas
composition that can operate safely and efficiently in customers' appliances.
The required gas processing has been estimated to cost $7.5 to $8.5
million annually. The commission's decision forces the Company to reverse about
$1.9 million of pre-tax income in the fourth quarter of 1999, which the Company
previously anticipated recovering through its semiannual pass-through rate
filings. The Company will also incur an additional $600,000 to $700,000 in
monthly operating expenses going forward.
In denying the Company's request, the commission provided guidance for
the Company to seek recovery of future CO2-removal costs through other
rate-making procedures.
"We disagree and are extremely disappointed with the commission's
decision," said D. N. "Nick" Rose, Questar Gas president and CEO. "We believe
the fair way to pay for this processing, which is required for safe natural gas
supplies for our customers, is through a pass-through rate proceeding."
Unlike Utah, the Public Service Commission of Wyoming (PSCW) staff has
recommended immediate cost coverage for Wyoming's share of these costs.
According to Rose, the Company will ask for a rehearing. For ongoing
costs, the Company will explore other cost-recovery options including filing
a general rate case as the PSCU suggested its order.
Questar Gas Company is a wholly-owned subsidiary of Questar Corporation
(Questar). Questar is a Salt Lake City-based integrated energy resources and
services company with $2.2 billion in assets.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Exhibit
99. Press release issued by Questar Gas Company on December
7, 1999.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
QUESTAR GAS COMPANY
(Registrant)
December 7, 1999 By /s/D. N. Rose
(Date) D. N. Rose
President and
Chief Executive Officer
News Release
Questar Corporation
180 East 100 South
P.O Box 45433
Salt Lake City, UT 84145-0433
December 7, 1999
Contact: Chad Jones
Office: (801) 324-5495
Utah PSC Denies Questar Gas' Request For Pass-Through
Recovery of CO2 Gas-Processing Costs
SALT LAKE CITY --The Utah Public Service Commission (PSC) has denied
Questar Gas' request to recover in the company's semiannual
pass-through rate filing the cost of removing CO2 from gas processed
at a new plant near Price, Utah. Some of the natural gas Questar
delivers to its customers must be processed to remove CO2, ensuring a
natural gas composition that can operate safely and efficiently in
customers' appliances.
The required gas processing has been estimated to cost
$7.5 to $8.5 million annually. The commission's decision forces the
company to reverse about $1.9 million of pre-tax income in the fourth
quarter of 1999, which the company previously anticipated recovering
through its semiannual pass-through rate filings. The company will
also incur an additional $600,000 to $700,000 in monthly operating
expenses going forward.
In denying the company's request, the commission provided
guidance for the company to seek recovery of future CO2-removal costs
through other rate-making procedures.
"We disagree and are extremely disappointed with the
commission's decision," said D.N. "Nick" Rose, Questar Gas president
and CEO. "We believe the fair way to pay for this processing, which
is required for safe natural gas supplies for our customers, is
through a pass-through rate proceeding."
Unlike Utah, the Wyoming PSC staff has recommended immediate
cost coverage for Wyoming's share of these costs.
According to Rose, the company will ask for a rehearing.
For ongoing costs, the company will explore other cost-recovery
options, including filing a general rate case as the PSC suggested in
its order.
Questar Gas Company is a wholly owned subsidiary of Questar
Corp. (NYSE:STR). Questar Corp. is a Salt Lake City-based integrated
energy resources and services company with $2.2 billion in assets.
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