UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
Washington, D. C.
. . . . . . . . . . . . . . . . . . . . . . . . . .
.
In the Matter of .
.
ENTERGY ARKANSAS, INC. .
ENTERGY LOUISIANA, INC. .
ENTERGY MISSISSIPPI, INC. .
ENTERGY NEW ORLEANS, INC. .
.
File No. 70-5015 .
________________ CERTIFICATE
PURSUANT TO
In the Matter of RULE 24
.
SYSTEM FUELS, INC. .
SYSTEM ENERGY RESOURCES, INC. .
ENTERGY ARKANSAS, INC. .
ENTERGY LOUISIANA, INC. .
ENTERGY MISSISSIPPI, INC. .
ENTERGY NEW ORLEANS, 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 September 30, 1997, 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
<PAGE>
I. File No. 70-5015 and File No. 70-5889 - 1997 Fuel Supply
Programs
Expenditures for SFI's fuel program for 1997 during the 3rd
quarter and year to date are indicated below:
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
1997 Fuel Supply Program:
1. Gas and Oil Development
and Production $ (1) $ (9)
2. Nuclear Fuel Procurement 1,113 7,832
3. Fuel Oil Program (3,844) (10,697)
======= ========
TOTAL EXPENDITURES (2,732) (2,874)
------- -------
Less funds derived through
amortization & depreciation
charges
Amortization of Gas & Oil
Development & Production Costs 5 (2)
Depreciation & Other
amortization (93) (291)
------- -------
TOTAL depreciation & amortization (88) (293)
------- -------
Net Expenditures (2,819) (3,167)
(Increase) decrease in:
Outside financing - -
System Money Pool borrowings 2,490 10,461
------- --------
TOTAL (increase)decrease
in borrowings 2,490 10,461
------- --------
Increase (decrease) in working
capital $ 329 $ (7,294)
======== =========
1. Gas and Oil Development and
Production
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
Gas and Oil Development
and Production $ - $ -
========= =========
Effective July 1, 1996, SFI sold its interest in the
properties associated with its Gas and Oil Development and
Production Program (the "program").
During this quarter, SFI had insignificant expenditures
relative to the continuing shutdown of this operation. As
previously reported, SFI distributed $3.5 million of the
accumulated net proceeds to its parent companies, on
December 31, 1996. The remaining accumulated proceeds of
approximately $353,000 are being retained by SFI to cover
continuing shut down expenses to be completed in 1997.
Following completion of this work, any remaining proceeds,
or costs, will be distributed to the parent companies.
Calculation of the net expenditures (proceeds) from the
continuing shutdown activities of the Program, is:
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
Sales to non-System parties:
Natural gas $ - $ -
Condensate - -
Crude oil - -
-------- ---------
TOTAL - -
Miscellaneous income (including 5 (3)
sale of assets) -------- ---------
TOTAL 5 (3)
General and administrative
expense 5 (3)
Operating expense - -
Interest expense - -
Amortization adjustment 5 (2)
-------- ---------
Net proceeds $ (-5) $ 2
======== =========
2. Nuclear Fuel Procurement
(See Item III)
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
Nuclear Fuel Procurement $ 1,113 $7,832
======== =======
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
Activities during the period:
Expenditures for nuclear
materials and processing
services $ 0 $4,710
General and administrative
expense 157 474
Interest expense 956 2,729
-------- --------
TOTAL 1,113 7,913
-------- --------
Sales of nuclear materials and
processing services to
System companies 0 81
-------- --------
Net effect on inventory $1,113 $7,832
======== ========
During the 3rd quarter of 1997, SFI's purchases of nuclear
materials and services totaled $1.1 million.
During this reporting period, SFI had no sales of nuclear
materials and services.
3. Fuel Oil Program
(See Item II)
Net Expenditures
(In Thousands)
3rd Quarter Year to Date
Fuel Oil Inventory $(3,844) $(10,697)
========= ==========
a) Fuel Oil Inventory:
Barrels Book Value
Inventory as of: (In Thousands)
September 30, 1997 1,220 23,474
June 30, 1997 1,368 27,319
March 31, 1997 1,255 26,319
December 31, 1996 1,657 34,171
September 30, 1996 1,008 20,761
During 3rd Quarter
(In Thousands)
Barrels Value
Sales price per barrel
to System companies
excluding period cost:
#2 Fuel Oil 36 26.14
#6 Fuel Oil 1,005 16.58
SFI has a fuel oil contract with Marathon Oil Company dated April
15, 1982 that was originally scheduled to terminate on December
31, 1996. 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 the first quarter 1996, SFI and Marathon reached a
negotiated settlement to the dispute, and Marathon resumed
delivery. However, a different grade of fuel oil was substituted
for the fuel oil originally required to be delivered under the
contract. Deliveries of the substitute fuel oil began on March 1,
1996 and will continue through February 28, 1999.
During the third quarter 1997, SFI purchased 1,090,793 barrels of
Bunker Grade oil from Marathon, and sold this product to a third
party for approximately $16 million.
4. Other Items:
a) As of September 30, 1997, SFI's outstanding debt and
Parent Companies investment consisted of:
Parent Companies: In Thousands
Common Stock $ 20
Notes payable 34,000
--------
TOTAL 34,020
System Money Pool 45,977
Banks 0
--------
TOTAL $79,997
========
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 3rd quarter of 1997, SFI was
billed by Entergy Services for the following amounts:
Total
July August September 3rd Qtr
Cost of service
charged to
Service Requests
established to
track cost of functions
previously performed by
SFI personnel:
Direct Cost:
Labor and related
cost $ 8,245 $ 9,609 $ 8,196 $ 26,050
Other direct cost 1,491 2,781 1,940 6,212
Indirect Cost 656 800 708 2,164
-------- -------- -------- --------
TOTAL 10,392 13,190 10,844 34,426
-------- -------- -------- --------
Cost of services
charged to Service
Requests not related
to transfer of SFI
personnel: 115,500 66,303 92,313 274,116
-------- -------- -------- --------
Total cost of services
performed by Entergy
Services $125,892 $ 79,493 $103,157 $308,542
======== ======== ======== ========
Amounts billed to
Operating Companies for
the Fuel Oil Program $ 62,978 $ 44,063 $ 64,149 $171,190
Charged to Nuclear Fuel
Procurement 62,914 35,430 39,008 137,352
-------- -------- -------- --------
TOTAL $125,892 $ 79,493 $103,157 $308,542
======== ======== ======== ========
* Charged to the Fuel Oil Program as a component of period
costs. For the 3rd quarter of 1997 Fuel Oil Program period
costs were allocated 8% to ENTERGY ARKANSAS, INC., 56% to
ENTERGY LOUISIANA, INC., 26% to ENTERGY MISSISSIPPI, INC.,
and 10% to ENTERGY NEW ORLEANS, 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 shut down, financing
nuclear fuel inventory and fuel oil inventory and facilities, and
accounting functions related to these continuing activities.
During the third quarter, SFI filed an Application-Declaration,
on Form U-1, in File No. 70-9103 (the "U-1"), with the SEC
requesting authorization, among other things, (I) for SFI to
function as a supplier of transmission and distribution related
equipment and materials for the Entergy Corporation Operating
Companies, and (ii) for Entergy Gulf States, Inc. to acquire an
ownership interest in SFI and assume a share of the debt financing
for SFI on the same proportionate basis as the other operating
companies. The U-1 is pending.
II. File No 70-7574 Bank of America Agreement
This financing agreement expired January 31, 1996.
III. File No 70-7668 Yasuda Trust and Banking Co., Ltd. Agreement
(Yasuda)
As indicated in the previous filing pursuant to the SEC
order dated November 27, 1996, (Release No. 35-26617) in File No.
70-8899, activity pertaining to this loan agreement will be
reported by Entergy Services, Inc. under File No. 70-8899. This
loan agreement expired September 26, 1997 and will not be
renewed.
IV. File No 70-8331 Entergy Corporation Revolving Credit
Agreement (Entergy)
As indicated in the previous filing pursuant to the SEC
order dated November 26, 1996, (Release No. 35-26617) in File No.
70-8899, activity pertaining to this loan agreement will be
reported by Entergy Services, Inc. under File No. 70-8899.
<PAGE>
IN WITNESS WHEREOF, SFI has caused this certificate to be
executed as of the 30th of October, 1997.
ENTERGY ARKANSAS, INC.
ENTERGY LOUISIANA, INC.
ENTERGY MISSISSIPPI, INC.
ENTERGY NEW ORLEANS, INC.
SYSTEM ENERGY RESOURCES, INC.
ENTERGY CORPORATION
BY: /s/William J. Regan, Jr.
William J. Regan, Jr.
Vice President and Treasurer
SYSTEM FUELS, INC.
BY: /s/William J. Regan, Jr.
William J. Regan, Jr.
Vice President, Treasurer
and Assistant Secretary
