[Federal Register Volume 67, Number 231 (Monday, December 2, 2002)]
[Notices]
[Pages 71598-71599]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-30369]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-27607]
Filings Under the Public Utility Holding Company Act of 1935, as
Amended (``Act'')
November 22, 2002.
Notice is hereby given that the following filing(s) has/have been
made with the Commission pursuant to provisions of the Act and rules
promulgated under the Act. All interested persons are referred to the
application(s) and/or declaration(s) for complete statements of the
proposed transaction(s) summarized below. The application(s) and/or
declaration(s) and any amendment(s) is/are available for public
inspection through the Commission's Branch of Public Reference.
Interested persons wishing to comment or request a hearing on the
application(s) and/or declaration(s) should submit their views in
writing by December 17, 2002, to the Secretary, Securities and Exchange
Commission, Washington, DC 20549-0609, and serve a copy on the relevant
applicant(s) and/or declarant(s) at the address(es) specified below.
Proof of service (by affidavit or, in the case of an attorney at law,
by certificate) should be filed with the request. Any request for
hearing should identify specifically the issues of facts or law that
are disputed. A person who so requests will be notified of any hearing,
if ordered, and will receive a copy of any notice or order issued in
the matter. After December 17, 2002, the application(s) and/or
declaration(s), as filed or as amended, may be granted and/or permitted
to become effective.
Northeast Gas Markets LLC, et al. (70-10097)
Northeast Gas Markets LLC (``NEGM''), 100 Cummings Center, Suite
457G, Beverly, Massachusetts 01915-6132, a nonutility subsidiary of
KeySpan Corporation (``KeySpan''), a registered holding company; and
KeySpan's utility subsidiaries Brooklyn Union Gas Company d/b/a KeySpan
Energy Delivery New York (``KEDNY''), One MetroTech Center, Brooklyn
New York, 11201; KeySpan Gas East Corporation d/b/a KeySpan Energy
Delivery Long Island (``KEDLI''), 175 East Old Country Road,
Hicksville, New York 11801; Boston Gas d/b/a KeySpan Energy Delivery
New England (``Boston Gas'') and Essex Gas Company d/b/a KeySpan Energy
Delivery New England (``Essex Gas''), both located at One Beacon
Street, Boston, Massachusetts 02108; and EnergyNorth Natural Gas, Inc.
d/b/a KeySpan Energy Delivery New England (``ENGI''), 1260 Elm Street,
P.O. Box 329, Manchester, New Hampshire 03105 (collectively
``Applicants''),\1\ have filed an application-declaration, as amended,
under sections 12(f) and 13(b) of the Act and rule 54 under the Act.
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\1\ KEDNY, KEDLI, Boston Gas, Essex Gas and ENGI are
collectively referred to as the ``KeySpan Gas Utilities.''
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NEGM, a Delaware limited liability company, is a nonutility company
that provides natural gas procurement, contract management and
marketing services to clients located in the northeastern part of the
United States. KeySpan indirectly holds a 90% ownership interest in
NEGM. Michael S. Lucy Associates, a company which is wholly owned by
Michael S. Lucy, owns the remaining 10% interest of NEGM. Mr. Lucy is
the president of NEGM.
Currently, NEGM is a ``facilitating entity'' providing contract
services to customers in connection with large natural gas supply
contracts with Western Canadian gas producers. The two major gas supply
projects administered by NEGM are Boundary Gas, Inc. (``Boundary'') and
Alberta Northeast Gas Limited (``ANE''). NEGM provides contract
services to ANE and Boundary under longstanding management services
arrangements. ANE and Boundary purchase Canadian natural gas and resell
it to numerous local distribution companies (``US Customers'') in the
northeast United States. The Boundary arrangements end on January 15,
2003. The ANE arrangements will not expire in their entirety until
2007.
In order to avoid interruption of the base load supplies once the
Boundary arrangement ends, the KeySpan Gas Utilities as well as several
gas utilities that are Boundary participants but not affiliated with
KeySpan (``Unaffiliated Utilities''),\2\ have each entered into
contracts with EnCana Corporation (``Encana'') to supply Canadian gas
beginning on January 15, 2003 (``Encana
[[Page 71599]]
Gas Contracts''). Specifically, the Unaffiliated Utilities and the
KeySpan Gas Utilities have entered into a management service agreement
and agency agreement (collectively, the ``M&A Agreement'') under which
NEGM will provide contract services to the utilities for the EnCana Gas
Contracts after Boundary expires. However, the KeySpan Gas Utilities
and NEGM have executed a letter of agreement which states that the
effectiveness of the M&A Agreement as between NEGM and the KeySpan Gas
Utilities is conditioned upon obtaining any necessary approvals from
the Commission under the Act and applicable state regulatory
commissions.
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\2\ The Unaffiliated Utilities are Bay State Gas Company, The
Berkshire Gas Company, and Northern Utilities, Inc., gas utility
subsidiaries of NiSource and Energy East.
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In accordance with the M&A Agreement it has negotiated with the
Unaffiliated Utilities and the KeySpan Gas Utilities, NEGM will provide
day-to-day contract services consisting of notifying EnCana of the
amounts of gas the utilities would like to schedule for delivery;
processing and auditing the EnCana gas supply bills to ensure their
accuracy and submitting to the utilities their pro rata share of the
gas supply costs based on the amount of gas they each purchased;
preparing and filing regulatory and customs reports in Canada and the
U.S. relating to the EnCana gas supply; providing informational support
to the gas utilities for their federal and state regulatory filings;
and daily interactions with EnCana regarding the Encana Gas Contracts
(including price negotiations when appropriate). These are the same
types of services NEGM currently provides under the Boundary and ANE
arrangements. The fee structure under the M&A Agreement with NEGM is
the same as for a Boundary and ANE projects--$0.0128/Mcf of contracted
volume. Because the KeySpan Gas Utilities and the Unaffiliated
Utilities are parties to the same M&A Agreement, all of the
participating utilities (affiliated and non-affiliated) will receive
the same services at the same price and terms. Accordingly, Applicants
seek authorization for NEGM to provide gas contract services to the
KeySpan Gas Utilities under the terms as outlined above.
With respect to the KeySpan Gas Utilities, the Encana Gas Contracts
and the M&A Agreement expire on March 31, 2004, unless extended
pursuant to the terms of those agreements. Once these arrangements
terminate, NEGM may wish to enter into contracts to provide the KeySpan
Gas Utilities with contract services for new Canadian gas supplies that
the KeySpan Gas Utilities purchase. Accordingly, NEGM also requests
authorization to enter into future agreements to provide contract
services to the KeySpan Gas Utilities with respect to their gas
supplies provided the following conditions are met: (1) The price
charged to a KeySpan Gas Utility is no greater than the prices that
unaffiliated entities pay to NEGM for the same type of contract
services; (2) the non-price terms of any NEGM gas contract services
provided to a KeySpan Gas Utility are the same as those provided to
non-affiliated entities obtaining the same type of service from NEGM;
and (3) the KeySpan Gas Utility's cost of gas is regulated by its
applicable state commission and the utility treats the price paid for
NEGM services as a cost of gas.
For the Commission, by the Division of Investment Management,
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-30369 Filed 11-29-02; 8:45 am]
BILLING CODE 8010-01-P