UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
____________________________________________
In the Matter of
THIRTEENTH
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, 1998 is herein provided:
1a) Horizon's balance sheet at September 30, 1998 is attached as
Exhibit 1.
1b) National's balance sheet at September 30, 1998 is included in
National's Form 10-K for fiscal 1998, which will be filed with the
Commission in December 1998 and is incorporated herein by reference.
2a) Horizon's income statement for the quarter ended September 30, 1998
is attached as Exhibit 2.
2b) National's income statement for the fiscal year ended September, 1998
is included in National's Form 10-K for fiscal 1998, which will be
filed with the Commission in December 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 September 30, 1998.
None.
4) A general description of the activities of the Applicants for the
quarter ended September 30, 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
September 30, 1998, are as follows:
Horizon, through its wholly owned indirect subsidiary, 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 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.
As of September 30, 1998, HEDBV owned approximately 83% of the capital
stock of Severoceske Teplarny, a.s. ("SCT"). SCT, directly and through
its subsidiaries, distributes heat in the northern part of the Czech
Republic. SCT, through one of its subsidiaries, also generates and
sells power at wholesale in that region.
During the quarter ended September 30, 1998 HEDBV increased its
ownership by approximately .25% to approximately 86.17% of the capital
stock of Prvni Severozapadni Teplarenska, a.s. ("PSZT"). PSZT
distributes heat and also generates and sells power at wholesale in
the northern part of the Czech Republic. PSZT is currently involved in
a capital construction project involving the reconstruction of its
steam generating boilers. A portion of the funds required for this
project will be provided by Horizon. None of the funds associated with
these transactions was borrowed through the National Fuel Gas System
"Money Pool."
HEDBV, as a shareholder of SCT, has received, and expects to continue
to receive, dividends from its investment in the SCT shares. HEDBV, as
a shareholder of PSZT, expects to receive dividends from its
investment in PSZT shares. Furthermore, in the future, PSZT and SCT
will pursue efforts by which PSZT and SCT might directly or indirectly
develop additional electrical generation capacity.
During the quarter ended September 30, 1998, HEDBV joined with a third
party to form a limited liability company (WHV Eromu Korlatolt
Felelossegu Tarsasag ("Hungarian LLC")) under the laws of Hungary for
the purpose of submitting a bid in a power tender conducted by the
Hungarian Power grid. As of September 30, 1998, the Hungarian LLC had
no material assets or liabilities.
The aggregate investment of National and its subsidiaries in electric
wholesale generators and foreign utility companies does not exceed the
limits set forth in the Commission's Rule 53.
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, 1998:
Neither Horizon nor National engaged in any intercompany service
transactions with affiliated Intermediate Companies.
November 25, 1998 NATIONAL FUEL GAS COMPANY
By: /s/ Philip C. Ackerman
_________________________________
Philip C. Ackerman
Senior Vice President
HORIZON ENERGY DEVELOPMENT,
INC.
By: /s/ Ronald J. Tanski
_________________________________
Ronald J. Tanski
Secretary and Treasurer
Exhibit 1
HORIZON ENERGY DEVELOPMENT, INC.
BALANCE SHEET
(Unaudited)
At September 30, 1998
---------------------
ASSETS
Current Assets:
Cash $ 8,907,627
Notes Receivable - Intercompany 2,500,000
Accounts Receivable - Net 8,877,228
Unbilled Utility Revenue 710,139
Accounts Receivable - Intercompany 6,194
Materials & Supplies 6,059,412
Prepaid Expenses 153,844
------------
Total Current Assets 27,214,444
------------
Property, Plant & Equipment 281,709,633
Less: Reserve for DDA 79,120,111
------------
202,589,522
------------
Other Assets: 12,535,187
------------
Total Assets $242,339,153
============
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 (11,659,361)
Cumulative Translation Adjustment 7,264,986
------------
Total Stockholders Equity 33,855,625
------------
Long-Term Debt, Net of Current Portion 64,675,920
Long-Term Debt - Intercompany 90,000,000
------------
Total Long-Term Debt 154,675,920
------------
Minority Interest in Foreign Subsidiaries 25,479,242
------------
Current and Accrued Liabilities:
Current Portion of Long-Term Debt 710,833
Notes Payable - Intercompany 2,700,000
Accounts Payable 8,682,293
Accounts Payable - Intercompany 2,976,906
Federal Income Taxes Payable (249,991)
Other Accrued Liabilities 8,898,855
------------
Total Current and Accrued Liabilities 23,718,896
------------
Deferred Credits:
Accumulated Deferred Income Taxes 4,397,856
Other Deferred Credits 211,614
------------
Total Deferred Credits 4,609,470
------------
Total Liabilities and Stockholders Equity $242,339,153
============
Exhibit 2
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months Ended
September 30, 1998
------------------
Operating Revenues $ 3,473,003
-----------
Operating Expenses:
Fuel Used in Heat and Electric Generation 7,547,980
Operation Expense (1,297,315)
Maintenance Expense (604,737)
Property, Franchise and Other Taxes 1,138,083
Depreciation, Depletion and Amortization 2,256,255
-----------
Total Operating Expenses 9,040,266
-----------
Operating Loss (5,567,263)
-----------
Other Income 2,401,796
-----------
Interest Charges 2,715,594
-----------
Loss Before Income Taxes (5,881,061)
-----------
Income Taxes - Current (3,254,382)
- Deferred 1,404,836
-----------
(1,849,546)
-----------
Minority Interest in Foreign Subsidiaries 822,693
-----------
Net Loss $(3,208,822)
===========
