UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
- -----------------------------------------------
In the Matter of
FOURTEENTH
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 December 31, 1998 is herein provided:
1a) Horizon's balance sheet at December 31, 1998 is attached
as Exhibit 1.
1b) National's balance sheet at December 31, 1998 is
included in National's Form 10-Q for the quarter ended
December 31, 1998, which was filed with the Commission
on February 16, 1999 and is incorporated herein by
reference.
2a) Horizon's income statement for the quarter ended
December 31, 1998 is attached as Exhibit 2.
2b) National's income statement for the quarter ended
December, 1998 is included in National's Form 10-Q for
the quarter ended December 1998, which was filed with
the Commission on February 16, 1999 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 December 31, 1998.
None.
4) A general description of the activities of the
Applicants for the quarter ended December 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 December 31, 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 Telplarna 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 December 31, 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.
As of December 31, 1998 HEDBV owned 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 construction of
fluidized 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".
<PAGE>
HEDBV, as a shareholder of SCT, has received, and
expects to receive in the future, dividends from its
investment in the SCT shares. HEDBV, as a shareholder of
PSZT, expects to receive, in the future, 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.
SCT and PSZT have filed a plan with the local Commercial
Court in the Czech Republic to merge the companies. The
plan of merger is currently under review.
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 December 31, 1998:
Neither Horizon nor National engaged in any intercompany
service transactions with affiliated Intermediate
Companies.
February 26, 1999 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
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months Ended
December 31, 1998
------------------
Operating Revenues $40,264,773
-----------
Operating Expenses:
Fuel Used in Heat and Electric Generation 19,710,311
Operation Expense 8,499,452
Maintenance Expense 14,019
Property, Franchise and Other Taxes 817,048
Depreciation, Depletion and Amortization 2,527,542
-----------
Total Operating Expenses 31,568,372
-----------
Operating Income 8,696,401
-----------
Other Income 627,530
-----------
Interest Charges 3,725,548
-----------
Income Before Income Taxes 5,598,383
-----------
Income Taxes - Current 607,144
- Deferred (556,264)
-----------
50,880
-----------
Minority Interest in Foreign Subsidiaries (1,264,351)
-----------
Net Income $ 4,283,152
===========
HORIZON ENERGY DEVELOPMENT, INC.
BALANCE SHEET
(Unaudited)
At December 31, 1998
--------------------
ASSETS
Current Assets:
Cash $ 8,548,647
Notes Receivable - Intercompany 300,000
Accounts Receivable - Net 15,561,652
Unbilled Utility Revenue 2,185,034
Accounts Receivable - Intercompany 1,080
Materials & Supplies 6,710,325
Prepaid Expenses 146,664
------------
Total Current Assets 33,453,402
------------
Property, Plant & Equipment 288,471,214
Less: Reserve for DDA 80,931,017
------------
207,540,197
------------
Other Assets: 15,088,801
------------
Total Assets $256,082,400
============
LIABILITIES AND STOCKHOLDERS EQUITY Capital Stock $1 Par:
Shares Authorized, Issued and Outstanding: 4,750 $ 4,750
Paid-in Capital 38,285,583
Retained Earnings (7,376,208)
Cumulative Translation Adjustment 7,395,171
------------
Total Stockholders Equity 38,309,296
------------
Long-Term Debt, Net of Current Portion 66,808,539
Long-Term Debt - Intercompany 90,000,000
------------
Total Long-Term Debt 156,808,539
------------
Minority Interest in Foreign Subsidiaries 26,141,211
------------
Current and Accrued Liabilities:
Current Portion of Long-Term Debt 712,975
Notes Payable - Intercompany 11,000,000
Accounts Payable 10,455,450
Accounts Payable - Intercompany 2,357,663
Federal Income Taxes Payable (929,123)
Other Accrued Liabilities 9,968,276
------------
Total Current and Accrued Liabilities 33,565,241
------------
Deferred Credits:
Accumulated Deferred Income Taxes 1,126,321
Other Deferred Credits 131,792
------------
Total Deferred Credits 1,258,113
------------
Total Liabilities and Stockholders Equity $256,082,400
============
