UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
- --------------------------------------------
In the Matter of
EIGHTH
NATIONAL FUEL GAS COMPANY CERTIFICATE
HORIZON ENERGY DEVELOPMENT, INC. PURSUANT TO
RULE 24
File No. 70-8649
(Public Utility Holding Company Act of 1935)
- --------------------------------------------
THIS IS TO CERTIFY, pursuant to Rule 24, that certain transactions
proposed by National Fuel Gas Company ("National") and its subsidiary, Horizon
Energy Development, Inc. ("Horizon") in its Application-Declaration on Form U-1,
as amended (File No. 70-8649), have been carried out in accordance with the
terms and conditions of said Application-Declaration and the Order (HCAR No.
35-26364, dated August 29, 1995) of the Securities and Exchange Commission (the
"Commission") with respect thereto, and that the following information for the
quarter ended June 30, 1997 is herein provided:
1a) Horizon's balance sheet at June 30, 1997 is attached as Exhibit 1.
1b) National's balance sheet at June 30, 1997 is included in
National's Form 10-Q for the third quarter of fiscal 1997, which
was filed with the Commission on August 6, 1997 and is
incorporated herein by reference.
2a) Horizon's income statement for the quarter ended June 30, 1997
is attached as Exhibit 2.
2b) National's income statement for the quarter ended June 30, 1997
is included in National's Form 10-Q for the third quarter of
fiscal 1997, which was filed with the Commission on August 6,
1997 and is incorporated herein by reference.
3) Recourse and non-recourse debt securities issued to third
parties by Intermediate Companies during the quarter ended June
30, 1997:
None.
4) A general description of the activities of the Applicants for
the quarter ended June 30, 1997, and of the projects in which
they or their subsidiary
companies have an ownership interest:
Currently, the Project Activities (as such term is defined
in the aforesaid Application-Declaration) that National and
Horizon, and subsidiaries of Horizon, are engaged in pursuant to
File No. 70-8649, are as follows:
Horizon, through its wholly owned subsidiary, Beheer-En
Beleggingsmaatschappij Bruwabel, B.V. (Bruwabel"), continues to
own 100% of the capital stock of each of Power International
s.r.o. (now, Horizon Energy Development s.r.o.), ("HED") and
Power Development s.r.o. ("PD"). PD in turn continues to own 100%
of the capital stock of Teplarna Kromeriz a.s. ("TK"). These
entities continue to engage in power development and related
activities in the Czech Republic and eastern Europe.
The only material asset of HED, PD and TK is the distinct heating
system of TK, which sells steam heat to its residential and
commercial customers in the city of Kromeriz, Czech Republic. TK
continues to investigate ways to convert the existing steam plant
into a cogeneration facility, or otherwise to generate electricity
at the site. If progress is made in this endeavor Horizon, or its
subsidiaries will file for electric wholesale generator ("EWG") or
foreign utility company ("FUCO") status, as appropriate, at the
appropriate time.
During the quarter, one power development related activity came to
fruition. On April 2, 1997, Bruwabel acquired 385,315 shares of
the common stock of Severoceske Teplarny, a.s. ("SCT") from 3
sellers. This represents approximately 34% of the outstanding
shares of SCT. SCT is a power and heating utility located in the
northern part of the Czech Republic. Bruwabel paid approximately
$21.6 million, including legal and finders fees, for its equity
interest. Bruwabel has entered into a stock option agreement and
related agreements with 3 owners of SCT shares, which expires on
April 2, 1999, whereby Bruwabel may acquire an additional 34%
equity interest in SCT, either by means of a put from the sellers
or a call by Bruwabel.
Bruwabel, as a shareholder of SCT, expects to receive dividends
from said investment. Furthermore, Bruwabel and SCT will pursue
efforts by which SCT might develop additional electrical
generation capacity. In the event any such efforts proceed, the
appropriate entity will file for EWG or FUCO status, as
appropriate, at the appropriate time.
5) Information on intercompany service transactions (including
those provided at cost and at market rates) involving affiliated
Intermediate Companies during the quarter ended June 30, 1997:
Neither Horizon nor National engaged in any intercompany service
transactions with affiliate Intermediate Companies.
August 28, 1997 NATIONAL FUEL GAS COMPANY
By: /s/ Philip C. Ackerman
-----------------------------------
Philip C. Ackerman
Senior Vice President
HORIZON ENERGY DEVELOPMENT,
INC.
By: /s/ Bruce H. Hale
-----------------------------------
Bruce H. Hale
Vice President
Exhibit 1
HORIZON ENERGY DEVELOPMENT, INC.
BALANCE SHEET
(Unaudited)
At June 30, 1997
----------------
ASSETS
Current Assets:
Cash $ 420,890
Accounts Receivable 422,344
Prepaid Expenses 32,862
-----------
Total Current Assets 876,096
-----------
Property, Plant & Equipment 1,246,457
Less: Reserve for DDA 314,271
-----------
932,186
-----------
Investment in Severoceske Teplarny, a.s. 19,581,076
Other Assets 1,147,089
Deferred Charges 60,000
-----------
Total Other Assets 20,788,165
-----------
Total Assets $22,596,447
===========
LIABILITIES AND STOCKHOLDERS EQUITY Capital Stock $1 Par:
Shares Authorized, Issued and Outstanding: 1,250 $ 1,250
Paid-in Capital 3,248,750
Retained Earnings (11,922,852)
Cumulative Translation Adjustment (2,245,166)
-----------
Total Stockholders Equity (10,918,018)
-----------
Current and Accrued Liabilities:
Notes Payable - Intercompany 31,100,000
Accounts Payable 116,227
Accounts Payable - Intercompany 1,040,712
Federal Income Taxes Payable (309,220)
Other Accrued Liabilities 467,889
-----------
Total Current and Accrued Liabilities 32,415,608
-----------
Deferred Credits:
Accumulated Deferred Income Taxes 530,835
Other Deferred Credits 568,022
-----------
Total Deferred Credits 1,098,857
-----------
Total Liabilities and Stockholders Equity $22,596,447
===========
Exhibit 2
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months
Ended
June 30, 1997
-------------
Operating Revenues $ 321,145
----------
Operating Expenses:
Operation Expense 853,918
Maintenance Expense 12,370
Property, Franchise and Other Taxes 223,000
Depreciation, Depletion and Amortization 13,743
----------
Total Operating Expenses 1,103,031
----------
Operating Loss (781,886)
----------
Other Income 114,776
----------
Interest Charges 437,712
----------
Loss Before Income Taxes (1,104,822)
----------
Income Taxes - Current (204,200)
- Deferred (9,286)
----------
(213,486)
----------
Net Loss $ (891,336)
==========
