UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
- ------------------------------------------------------
In the Matter of
ELEVENTH
NATIONAL FUEL GAS COMPANY CERTIFICATE
HORIZON ENERGY DEVELOPMENT, INC. PURSUANT TO
RULE 24
File No. 70-8649
(Public Utility Holding Company Act of 1935)
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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 March 31, 1998 is herein provided:
1a) Horizon's balance sheet at March 31, 1998 is attached as Exhibit 1.
1b) National's balance sheet at March 31, 1998 is included in
National's Form 10-Q for the second quarter of fiscal 1998, which
has been filed with the Commission on May 14, 1998 and is
incorporated herein by reference.
2a) Horizon's income statement for the quarter ended March 31, 1998
is attached as Exhibit 2.
2b) National's income statement for the quarter ended March 31, 1998
is included in National's Form 10-Q for the second quarter of
fiscal 1998, which was filed with the Commission on May 14, 1998
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 March 31, 1998.
None.
4) A general description of the activities of the Applicants for
the quarter ended March 31, 1998, and of the projects in which
they or their subsidiary companies have an ownership interest:
The Project Activities (as such term is defined in the aforesaid
Application-Declaration) that National and Horizon, and
subsidiaries of Horizon, were engaged in pursuant to File No.
70-8649, as of March 31, 1998, are as follows:
Horizon, through its wholly owned subsidiary, Beheer-En
Beleggingsmaatschappij, Bruwabel, B.V., (subsequently renamed
Horizon Energy Development B.V. ("HEDBV")), continues to own 100%
of the capital stock of each of 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.
As of March 31, 1998, HEDBV owned approximately 74% of the capital
stock of Severoceske Teplarny, a.s. ("SCT"). SCT distributes steam
heat and, through one of its subsidiaries, sells power in the
northern part of the Czech Republic.
HEDBV, as a shareholder of SCT, has received, and expects to
continue to receive, dividends from its investment in the SCT
shares. Furthermore, HEDBV and SCT will pursue efforts by which SCT
might directly or indirectly develop additional electrical
generation capacity.
On February 19, 1998, HEDBV purchased 757,477 shares of the capital
stock of Prvni Severozapadni Teplarenska a.s. ("PSZT"). No
additional shares of PSZT were purchased on or before March 31,
1998. This level of shareholdings represented approximately 75% of
the capital stock of PSZT. PSZT distributes steam heat and sells
power in the northern part of the Czech Republic.
<PAGE>
On May 29, 1998, Horizon filed a Notification of Foreign Utility
Company Status on Form U-57 on behalf of SCT, Teplarna Liberec,
a.s. (an SCT subsidiary), PSZT and TK.
5) Information on intercompany service transactions (including
those provided at cost and at market rates) involving affiliated
Intermediate Companies during the quarter ended March 31, 1998:
Neither Horizon nor National engaged in any intercompany
service transactions with affiliate Intermediate Companies.
June 1, 1998 NATIONAL FUEL GAS COMPANY
By: /s/ Philip C. Ackerman
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Philip C. Ackerman
Senior Vice President
HORIZON ENERGY DEVELOPMENT,
INC.
By: /s/ Ronald J. Tanski
----------------------------------
Ronald J. Tanski
Secretary and Treasurer
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months Ended
March 31, 1998
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Operating Revenues $42,558,325
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Operating Expenses:
Fuel Used in Heat and Electric Generation 12,887,413
Operation Expense 21,418,792
Maintenance Expense 141,157
Property, Franchise and Other Taxes 20,046
Depreciation, Depletion and Amortization 2,067,218
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Total Operating Expenses 36,534,626
-----------
Operating Income 6,023,699
-----------
Other Income 6,002,865
-----------
Interest Charges 1,211,533
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Income Before Income Taxes 10,815,031
-----------
Income Taxes - Current 3,550,262
- Deferred (21,035)
-----------
3,529,227
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Minority Interest in Foreign Subsidiaries (2,402,017)
-----------
Net Income $ 4,883,787
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HORIZON ENERGY DEVELOPMENT, INC.
BALANCE SHEET
(Unaudited)
At March 31, 1998
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ASSETS
Current Assets:
Cash $ 11,883,989
Accounts Receivable - Net 12,148,016
Unbilled Utility Revenue 1,128,296
Materials & Supplies 4,382,377
Prepaid Expenses 169,266
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Total Current Assets 29,711,944
------------
Property, Plant & Equipment 242,992,170
Less: Reserve for DDA 66,437,804
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176,554,366
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Other Assets: 27,807,967
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Total Assets $234,074,277
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LIABILITIES AND STOCKHOLDERS EQUITY
Capital Stock $1 Par:
Shares Authorized, Issued and Outstanding: 4,750 $ 4,750
Paid-in Capital 38,245,250
Retained Earnings (8,401,839)
Cumulative Translation Adjustment (1,175,307)
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Total Stockholders Equity 28,672,854
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Long-Term Debt, Net of Current Portion 63,687,700
Long-Term Debt - Intercompany 10,000,000
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Total Long-Term Debt 73,687,700
------------
Minority Interest in Foreign Subsidiaries 34,824,560
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Current and Accrued Liabilities:
Notes Payable - Intercompany 72,300,000
Notes Payable to Banks 4,435,245
Current Portion of Long-Term Debt 473,093
Accounts Payable 5,148,160
Accounts Payable - Intercompany 1,920,939
Federal Income Taxes Payable (128,358)
Other Accrued Liabilities 11,947,038
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Total Current and Accrued Liabilities 96,096,117
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Deferred Credits:
Accumulated Deferred Income Taxes (142,971)
Other Deferred Credits 936,017
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Total Deferred Credits 793,046
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Total Liabilities and Stockholders Equity $234,074,277
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