UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION
- --------------------------------------------
In the Matter of
SEVENTEENTH
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, 1999 is herein provided:
1a) Horizon's balance sheet at September 30, 1999 is attached as
Exhibit 1.
1b) National's balance sheet at September 30, 1999 will be
included in National's Form 10-K for the fiscal year ended
September 30, 1999 which will be filed with the Commission on
or before December 30, 1999 and is incorporated herein by
reference.
2a) Horizon's income statement for the quarter ended September 30,
1999 is attached as Exhibit 2.
2b) National's income statement for the fiscal year ended
September, 1999 is included in National's Form 10-K for the
quarter ended September 1999, which will be filed with the
Commission on or before December 30, 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
September 30, 1999.
None.
4) A general description of the activities of the Applicants for
the quarter ended September 30, 1999, 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, 1999, are as follows:
Horizon, through its wholly owned indirect subsidiaries, Horizon Energy
Holdings, Inc. and 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 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 September 30, 1999, 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. SCT acquired a 66.5% interest
in, and has undertaken to operate, the district heating assets of
Jablonec nad Nisou. Closing of the transaction took place in September
1999 after an extraordinary meeting of shareholders on July 22, 1999.
As of September 30, 1999 HEDBV owned approximately 86% 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 expected
to become effective by January 1, 2000.
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, 1999:
Neither Horizon nor National engaged in any intercompany service
transactions with affiliated Intermediate Companies.
November 30, 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
Exhibit 1
HORIZON ENERGY DEVELOPMENT, INC.
BALANCE SHEET
(Unaudited)
At September 30, 1999
---------------------
ASSETS
Current Assets:
Cash $ 15,209,924
Accounts Receivable - Net 15,838,212
Unbilled Utility Revenue 1,306,072
Accounts Receivable - Intercompany 285
Materials & Supplies 7,134,016
Prepaid Expenses 96,733
------------
Total Current Assets 39,585,242
------------
Property, Plant & Equipment 283,527,884
Less: Reserve for DDA 80,076,327
------------
203,451,557
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Other Assets: 12,005,043
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Total Assets $255,041,842
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LIABILITIES AND STOCKHOLDERS EQUITY
Capital Stock $1 Par:
Shares Authorized, Issued and Outstanding: 4,750 $ 4,750
Paid-in Capital 38,245,591
Retained Earnings (9,383,243)
Cumulative Translation Adjustment (4,472,446)
------------
Total Stockholders Equity 24,394,652
------------
Long-Term Debt, Net of Current Portion 45,721,824
Long-Term Debt - Intercompany 90,000,000
------------
Total Long-Term Debt 135,721,824
------------
Minority Interest in Foreign Subsidiaries 27,588,923
------------
Current and Accrued Liabilities:
Notes Payable to Banks 1,194,832
Current Portion of Long-Term Debt 16,863,883
Notes Payable - Intercompany 26,600,000
Accounts Payable 10,396,996
Accounts Payable - Intercompany 3,189,863
Federal Income Taxes Payable (833,222)
Other Accrued Liabilities 4,049,138
------------
Total Current and Accrued Liabilities 61,461,490
------------
Deferred Credits:
Accumulated Deferred Income Taxes 5,507,891
Other Deferred Credits 367,062
------------
Total Deferred Credits 5,874,953
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Total Liabilities and Stockholders Equity $255,041,842
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Exhibit 2
HORIZON ENERGY DEVELOPMENT, INC.
INCOME STATEMENT
(Unaudited)
Three Months Ended
September 30, 1999
------------------
Operating Revenues $ 9,879,679
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Operating Expenses:
Fuel Used in Heat and Electric Generation 7,940,013
Operation Expense 4,340,568
Maintenance Expense 10,075
Property, Franchise and Other Taxes 829,931
Depreciation, Depletion and Amortization 2,573,113
-----------
Total Operating Expenses 15,693,700
-----------
Operating Income (Loss) (5,814,021)
-----------
Other Income 731,772
-----------
Interest Charges 2,526,073
-----------
Income (Loss) Before Income Taxes (7,608,322)
-----------
Income Taxes - Current (4,609,517)
- Deferred 3,645,106
-----------
(964,411)
-----------
Minority Interest in Foreign Subsidiaries 923,644
-----------
Net Income (Loss) $(5,720,267)
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