UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
- --------------------------------------------
In the Matter of
NINTH
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 September 30, 1997 is herein provided:
1a) Horizon's balance sheet at September 30, 1997 is attached as
Exhibit 1.
1b) National's balance sheet at September 30, 1997 is
included in National's Form 10-K for fiscal 1997, which will be
filed with the Commission in December 1997 and is incorporated
herein by reference.
2a) Horizon's income statement for the quarter ended September 30,
1997 is attached as Exhibit 2.
2b) National's income statement for the quarter ended September 30,
1997 is included in National's Form 10-K for fiscal 1997, which
will be filed with the Commission in December 1997 and is
incorporated herein by reference.
<PAGE>
3) Recourse and non-recourse debt securities issued to third parties
by Intermediate Companies during the quarter ended September 30,
1997:
None.
4) A general description of the activities of the Applicants for
the quarter ended September 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 district
heating system of TK, which sells steam heat to its residential
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.
Between April and September, 1997, Bruwabel acquired 417,051
shares of the common stock of Severoceske Teplarny, a.s. ("SCT").
SCT is a power and heating utility located in the northern part
of the Czech Republic. Bruwabel consequently owned approximately
37% of the outstanding common stock of SCT as of September 30,
1997.
<PAGE>
Bruwabel also has a stock option agreement and related
agreements with three owners of SCT shares. Under Bruwabel's
stock option agreement, which expires on April 2, 1999, it may
acquire an additional 34% equity interest in SCT, either by means
of a put from the sellers or a call by Bruwabel. These three
owners have notified Bruwabel of the exercise of the put.
Bruwabel expects to close on such acquisition in December, 1997.
Bruwabel, as a shareholder of SCT, has received, and expects to
continue to receive, dividends from its investment in the SCT
shares. 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 September 30,
1997:
Neither Horizon nor National engaged in any intercompany
service transactions with affiliate Intermediate Companies.
<PAGE>
November 25, 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 September 30, 1997
---------------------
ASSETS
Current Assets:
Cash $ 1,188,202
Accounts Receivable 569,928
Prepaid Expenses 5,617
-----------
Total Current Assets 1,763,747
-----------
Property, Plant & Equipment 1,307,033
Less: Reserve for DDA 365,297
-----------
941,736
-----------
Other Assets:
Investment in Severoceske Teplarny, a.s. 18,886,618
Other Assets 2,438,585
-----------
Total Other Assets 21,325,203
-----------
Total Assets $24,030,686
===========
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 (12,938,031)
Cumulative Translation Adjustment (2,085,375)
-----------
Total Stockholders Equity (11,773,406)
-----------
Long-Term Debt - Intercompany 10,000,000
-----------
Current and Accrued Liabilities:
Notes Payable - Intercompany 22,600,000
Accounts Payable 824,544
Accounts Payable - Intercompany 874,078
Federal Income Taxes Payable (153,514)
Other Accrued Liabilities 1,514,099
-----------
Total Current and Accrued Liabilities 25,659,207
-----------
Deferred Credits:
Accumulated Deferred Income Taxes (109,620)
Other Deferred Credits 254,505
-----------
Total Deferred Credits 144,885
-----------
Total Liabilities and Stockholders Equity $24,030,686
===========
Exhibit 2
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months Ended
September 30, 1997
------------------
Operating Revenues $ 64,743
-----------
Operating Expenses:
Operation Expense 623,841
Maintenance Expense 29,458
Property, Franchise and Other Taxes 11,812
Depreciation, Depletion and Amortization 18,800
-----------
Total Operating Expenses 683,911
-----------
Operating Loss (619,168)
-----------
Other Income (203,609)
-----------
Interest Charges 487,150
-----------
Loss Before Income Taxes (1,309,927)
-----------
Income Taxes - Current 345,706
- Deferred (640,454)
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(294,748)
-----------
Net Loss $(1,015,179)
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