Exhibit 99.1

Quarterly Report to Holders of Contingent Value Obligations
For the Quarter Ended March 31, 2001

To: Holders of Contingent Value Obligations:

This is the quarterly report for the synthetic fuel plants owned by Solid Energy
LLC, Ceredo Synfuel LLC, Solid Fuel LLC, and Sandy River Synfuel LLC ("the
Earthco plants") for the quarter ending March 31, 2001.

Overview
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There are currently 98.6 million Contingent Value Obligations (CVOs) issued and
outstanding. CVOs were issued as a result of the Progress Energy, Inc. (Progress
Energy) and Florida Progress Corporation share exchange, which occurred on
November 30, 2000. For every Florida Progress Corporation share owned at that
time, one CVO was issued.

Each CVO represents the right to receive contingent payments, based on the net
after-tax cash flow generated by the Earthco plants. Qualifying synthetic fuel
plants entitle their owners to federal income tax credits based on the barrel of
oil equivalent of the synthetic fuel produced and sold by these plants. In the
aggregate, holders of CVOs are entitled to payments equal to 50% of any net
after-tax cash flow generated by the Earthco plants in excess of $80 million per
year for each of the years 2001 through 2007. Payments on the contingent value
obligations will not be made until tax audit matters are resolved. Based on past
tax audit experience, it is anticipated that payments will not begin before
2007.

For purposes of calculating CVO payments, net after-tax cash flows include the
taxable income or loss for the Earthco plants adjusted for depreciation and
other non-cash items plus income tax benefits, and minus income tax incurred.
The total amount of net after-tax cash flow for any year will depend upon the
final determination of the income tax savings realized and the income taxes
incurred after completion of the income tax audits. Thus, the estimated
after-tax cash flow generated by the Earthco plants could increase or decrease
due to changes in the income tax savings realized for the year.

This is only an overview of the terms of the CVOs. The legal documents governing
the CVOs contain significant additional information.

Results of Operations
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The estimated net after-tax cash flow deficits for the quarter for each of the
Earthco plants are as follows: Solid Energy LLC $(7.4) million, Ceredo Synfuel
LLC $(4.5) million, Solid Fuel LLC $(1.4) million, Sandy River Synfuel LLC
$(12.0) million. An estimated $53 million in synthetic fuel tax credits were
generated, but not realized nor included in the net after-tax cash flow deficits
in the first quarter of 2001. Progress Energy can only use tax credits as
offsets to


taxes otherwise incurred. Due to the seasonal nature of Progress Energy's
business, the estimated synthetic fuel tax credits realized for the quarter and
included in the estimates are substantially lower than the synthetic fuel tax
credits generated by the Earthco plants, and are not indicative of the synthetic
fuel tax credits to be realized for the entire year.

Material Developments
---------------------

There have been no adjustments or relevant tax proceedings for the above period.

The Internal Revenue Service (IRS) recently released Revenue Procedure 2001-30
and Revenue Procedure 2001-34 that outline the conditions that must be met to
receive a Private Letter Ruling (PLR) for Section 29 tax credits from the IRS.
PLRs represent advance rulings from the IRS applying its interpretation of the
tax law to an entity's facts for Section 29 credits. The Company continues to
pursue PLRs for the Earthco plants.

Supplemental Information:

Where can I find a current market value of the CVO?
CVOs are traded on the Over The Counter "pink sheets." You will need to contact
your broker to obtain a value or you may go on the Internet and visit the
following web site: www.pinksheets.com. Click on the "symbol lookup" and type
"Progress Energy" in the "Search for a security" site, click "go" then click on
"quote" to obtain the latest quote.

How can I purchase or sell CVOs?
You will need to contact a broker to purchase or sell CVOs.

What is the cost basis in the CVOs?
For federal income tax reporting purposes, the Company will treat 54.5 cents as
the fair market value of each CVO that was issued on November 30, 2000, the
effective date of the share exchange. That amount is the average of the reported
high and low trading prices of the CVOs on the NASDAQ Over The Counter Market on
November 30, 2000. If you received your CVOs in the share exchange, the fair
market value of the CVOs on the date of the share exchange, 54.5 cents, is to be
used as your tax basis for your CVOs. If you acquired your CVOs after the share
exchange, please consult your tax advisor for your tax basis.

Who is the Securities Registrar and Transfer Agent for the CVOs?
Mellon Investor Services is the Securities Registrar and Transfer Agent. The
address is:

Mellon Investor Services
P.O. Box 3338
South Hackensack, NJ 04606-1938

Call toll free 1 877-711-4092