UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
Washington, D. C.
. . . . . . . . . . . . . . . . . . . . . . .
In the Matter of .
.
ARKANSAS POWER & LIGHT COMPANY .
LOUISIANA POWER & LIGHT COMPANY .
MISSISSIPPI POWER & LIGHT COMPANY .
NEW ORLEANS PUBLIC SERVICE INC. .
.
File No. 70-5015 .
________________ . CERTIFICATE
. PURSUANT TO
In the Matter of . RULE 24
.
SYSTEM FUELS, INC. .
SYSTEM ENERGY RESOURCES, INC .
ARKANSAS POWER & LIGHT COMPANY .
LOUISIANA POWER & LIGHT COMPANY .
MISSISSIPPI POWER & LIGHT COMPANY .
NEW ORLEANS PUBLIC SERVICE INC. .
.
File No. 70-5889 .
File No. 70-7574 .
File No. 70-7668 .
________________ .
.
In the Matter of .
.
SYSTEM FUELS, INC. .
ENTERGY CORPORATION .
.
File No. 70-8331 .
.
(Public Utility Holding Company Act of 1935) .
. . . . . . . . . . . . . . . . . . . . . . .
Pursuant to Rule 24 promulgated by the Securities and Exchange
Commission (SEC) under the Public Utility Holding Company Act of
1935, modified by request in the application(s) - declaration(s)
referenced above, this is to certify that the following
transactions were carried out and borrowings made, during the
quarter ended December 31, 1995, pursuant to System Fuels, Inc.'s
(SFI) function as a supplier of fuel for the Entergy Corporation
Operating Companies (System) in accordance with the terms and
conditions of and for the purposes represented in the
application(s) - declaration(s), as amended, and pursuant to the
Orders of the SEC, indicated below:
70-5015 December 17, 1971 .......................I
70-5889 April 28, 1978 .......................I
70-7574 January 31, 1989 ......................II
70-7668 September 27, 1989 .....................III
70-8331 March 16, 1994 ......................IV
I. File No. 70-5015 and File No. 70-5889 - 1995 Fuel Supply
Programs
Expenditures for SFI's fuel program for 1995 during the 4th
quarter and year to date are indicated below:
Net Expenditures
During Year
4th Qtr To Date
(In Thousands)
1995 Fuel Supply Program:
1. Gas and Oil Development and $ 59 $164
Production
2. Nuclear Fuel Procurement 1,009 10,303
3. Fuel Oil Program 431 (576)
------ ------
Total Expenditures 1,499 9,891
------ ------
Less funds derived through amortization and
depreciation charges:
Amortization of Gas and Oil
Development and
Production Costs 628 (1,095)
Depreciation and other amortization (140) (560)
-------- -------
Total depreciation and amortization 488 (1,655)
--------- -------
Net Expenditures 1,987 8,236
(Increase) decrease in:
Outside financing (30,000) (7,000)
System Money Pool borrowings 11,889 2,832
-------- -------
Total (increase) decrease in borrowings (18,111) 4,168
-------- -------
Increase (decrease) in working capital $16,124 $(4,068)
======= ========
1. Gas and Oil Development and Production
Net Expenditures
During Year
4th Qtr To Date
(In Thousands)
Gas and Oil Development and $ 59 $ 164
Production ======== ======
a) During the quarter, there was no drilling activity.
b) During the 4th quarter of 1995, SFI produced 278,674
MCFs of natural gas and 12,575 barrels of oil from it's
Gas and Oil Development and Production Program (Program)
which were sold to non-System parties.
During the 4th quarter of 1995, all of SFI's
natural gas production was sold to non-System parties.
This condition is expected to continue indefinitely. As a
result, SFI's expenditures in the Program are being
limited to amounts required to protect its existing
investment in the properties. Investments in new leases
are not being made at this time.
During this quarter, SFI recorded a reduction to
excess amortization of $628,000, thus reducing accumulated
year to date amortization to $1,095,000. When offset by
year to date expenditures of $164,000, accumulated excess
amortization is $930,891 for the year and $970,425 in
total at December 31, 1995.
c) Calculation of net proceeds from sales to
non-System parties from the Program used to amortize the
investment in the Program:
Net
Expenditures
During Year
4th Qtr To
Date
(In Thousands)
Sales to non-System parties:
Natural gas $ 650 $2,586
Condensate 56 182
Crude oil 232 749
----- -----
Total 938 3,517
Miscellaneous income from non- 66 277
System parties.. ----- -----
Total 1,004 3,794
General and administrative (672) (782)
expense
Operating expense (292) (1,046)
Interest expense 23 20
Amortization adjustment (692) (891)
------ -------
Net proceeds $ 628 $(1,095)
===== =======
2. Nuclear Fuel Procurement (See Item III)
Net
Expenditures
During Year
4th Qtr To
Date
(In Thousands)
Nuclear Fuel Procurement $ 1,009 $ 10,303
======= ========
Net
Expenditures
During Year
4th Qtr To
Date
(In Thousands)
Activities during the period:
Expenditures for nuclear
materials and processing
services $ 37 $91,975
General and administrative expense 52 180
Interest expense
920 2,900
------ ------
Total
1,009 95,055
------- ------
Sales of nuclear materials
and processing
services to System -
companies 84,752
-------- -------
Net effect on inventory $1,009 $10,303
======== =======
During the 4th quarter of 1995, SFI's purchases totaled $1.0
million for nuclear materials and services. There were no
sales during the quarter, and, no new contracts were entered
into. However, due to an oversight, on August 31, 1995, SFI
entered into a new contract for enrichment services. This was
not reported last period.
3. Fuel Oil Program (See Item II)
Net Expenditures
During Year
4th Qtr To
Date
(In Thousands)
Fuel Oil Inventory $ 431 $ (576)
========= =========
a) Fuel Oil Inventory:
Book
Inventory as of: Barrels Value
(In Thousands)
December 31, 1995 1,747 $ 27,950
September 30, 1995 1,729 $ 27,518
June 30, 1995 1,755 $ 28,459
March 31, 1995 1,757 $ 28,359
December 31, 1994 1,759 $ 28,526
During 4th Qtr.
Barrels Cost
Sales price per barrel to System
companies excluding period cost:
#2 Fuel Oil 21,398 $25.47
#6 Fuel Oil 3,596 $11.70
SFI has a fuel oil contract with Marathon Oil Company dated
April 15, 1982. On January 1, 1994 Marathon breached the
contract by refusing to deliver product and on December 29,
1994, SFI filed suit against Marathon in federal court in New
Orleans, Louisiana. During this quarter, SFI continued to
prepare for the trial which was rescheduled from November 27,
1995 to January 29, 1996 at the request of the court. At this
period's end, an out-of-court settlement is being negotiated.
4. Other Items:
a) As of December 31, 1995, SFI's outstanding debt and
Parent Companies investment consisted of:
(In Thousands)
Parent Companies:
Common stock $ 20
Notes payable 34,000
--------
Total 34,020
System Money Pool 9,757
Banks 30,000
--------
Total $ 73,777
========
b) As of January 1, 1987, SFI's employees were
transferred to Entergy Services, Inc. (Entergy Services).
Entergy Services bills SFI for labor associated with the
operation of continuing activities for SFI and other
services provided to SFI (financial, legal,
administrative, and other activities). For the 4th
quarter of 1995, SFI was billed by Entergy Services for
the following amounts:
Total
During
Oct Nov Dec 4th Qtr
Cost of services
charged to Service Requests
established to track cost of
functions previously performed by
SFI personnel:
Direct Cost:
Labor and related costs $31,348 $21,167 $14,856 $67,371
Other direct cost 2,905 2,950 6,002 11,857
Indirect cost 6,010 2,116 1,702 9,828
------ ------ ------- -------
Total 40,263 26,233 22,560 89,056
====== ====== ======= =======
Cost of services charged to
Service Requests not related
to transfer of SFI
personnel: 106,335 135,585 179,974 421,894
------- ------- ------- -------
Total cost of services
performed by Entergy
Services $146,598 $161,818 $202,534 $510,950
======== ======== ======== ========
Amounts billed to Operating
Companies for the Fuel Oil
Program * $96,189 $106,203 $158,199 $360,591
Deferred Cost and services 0 0 (4,283) (4,283)
Charged to Nuclear Fuel
Procurement 7,079 9,954 10,681 27,714
Charged to Gas and Oil
Development and Production 43,330 45,661 37,937 126,928
------- -------- -------- --------
Total $146,59 $161,818 $202,534 $510,950
======= ======== ======== ========
* Charged to the Fuel Oil Program as a component of
period costs. For the 3rd quarter of 1995 Fuel Oil Program
period costs were allocated 8% to Arkansas Power & Light
Company, 56% to Louisiana Power & Light Company, 26% to
Mississippi Power & Light Company, and 10% to New Orleans
Public Service Inc.
c) As previously reported, the System's fuels planning
and procurement administration was reorganized during
1988, redefining the fuels management roles and placing
the responsibility for most fuel procurement decisions
with Entergy Corporation System Executives.
SFI, utilizing Entergy Services personnel, continues to be
responsible for gas and oil production, financing nuclear fuel
inventory and fuel oil inventory and facilities, and accounting
functions related to these continuing activities.
II. File No 70-7574 Bank of America Agreement
During the quarter, SFI had no borrowings or repayments
under this financing agreement. Commitment fees of $19,416 were
incurred on the unused portion of the agreement. As of December
31, 1995, the sum of the Aggregate Borrowing Base of Eligible
Fuel Oil Inventory and Receivables was $11,707,343, and there
were no outstanding borrowings under this agreement.
III. File No 70-7668 Yasuda Trust and Banking Co., Ltd. Agreement
(Yasuda)
During the quarter, SFI borrowed $30,000,000 under this
financing agreement. Commitment fees of $17,155 were incurred on
the unused portion of the agreement. The average outstanding
principal balance, was $16,451,612.90 and accrued nterest cost
was $85,416.67 for the quarter.
As previously reported, the Yasuda credit agreement was
amended, pursuant to SEC authorization (See HCAR No. 25634, dated
September 17, 1992) to increase the commitment fees and margins
payable on certain loans and to extend the termination date of
the agreement to September 27, 1996. A copy of the amended
credit agreement was previously filed with the SEC.
As of December 31, 1995, the book value of the nuclear fuel
was $47,593,000 and there was $30,000,000 of outstanding
borrowings under the Yasuda financing agreement.
IV. File No 70-8331 Entergy Corporation Revolving Credit
Agreement (Entergy)
Pursuant to the Order issued on March 16, 1994, (Release 35-
26006), SFI entered into a loan agreement with Entergy
Corporation on March 21, 1994. The agreement allows SFI to borrow
and reborrow from Entergy Corporation amounts not to exceed
$30,000,000 at any one time. This agreement expires on December
31, 1996.
As of the period ended December 31, 1995, SFI had borrowed
no funds under this agreement. Erroneously, the reported
borrowings, last period under this agreement, were that of a
short term arrangement and not this agreement.
<PAGE>
IN WITNESS WHEREOF, SFI has caused this certificate to be
executed as of the 1st of February, 1996.
ARKANSAS POWER & LIGHT COMPANY
LOUISIANA POWER & LIGHT COMPANY
MISSISSIPPI POWER & LIGHT COMPANY
NEW ORLEANS PUBLIC SERVICE INC.
SYSTEM ENERGY RESOURCES, INC
ENTERGY CORPORATION
SYSTEM FUELS, INC.
BY: /s/ William J. Regan
William J. Regan
Vice President and Treasurer
SYSTEM FUELS, INC.
BY: /s/ William J. Regan
William J. Regan
Vice President, Treasurer
and Assistant Secretary
