-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N00UlGQ/20wmtmMWHFNcUrFaYSgpW7Irndr5efcj5f0S4Af5DbXQj3+ju3ExmtTf JCfq2itO8A/Skijd7FF7Kg== 0000072741-98-000056.txt : 19980304 0000072741-98-000056.hdr.sgml : 19980304 ACCESSION NUMBER: 0000072741-98-000056 CONFORMED SUBMISSION TYPE: 35-CERT PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19980303 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTHEAST UTILITIES SYSTEM CENTRAL INDEX KEY: 0000072741 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 042147929 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 35-CERT SEC ACT: SEC FILE NUMBER: 070-08507 FILM NUMBER: 98556246 BUSINESS ADDRESS: STREET 1: 174 BRUSH HILL AVE CITY: WEST SPRINGFIELD STATE: MA ZIP: 01090-0010 BUSINESS PHONE: 4137855871 MAIL ADDRESS: STREET 1: 107 SELDON ST CITY: BERLIN STATE: CT ZIP: 06037-1616 35-CERT 1 COE, INC. QTRYLY RPT FILING UNDER RULE 24 OF 35 ACT UNITED STATES OF AMERICA SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Application of Northeast ) ) CERTIFICATE PURSUANT TO Utilities, Charter Oak Energy ) RULE 24 UNDER THE PUBLIC ) UTILITY HOLDING COMPANY ACT Inc. and COE Development ) OF 1935 ) Corp. on Form U-1 ) ) (File No. 70-8507) ) Pursuant to the requirements of Rule 24 under the Public Utility Holding Company Act of 1935, Charter Oak Energy, Inc. ("Charter Oak"), a wholly-owned subsidiary of Northeast Utilities ("NU"), a registered holding company, hereby files this quarterly report as required by the Securities and Exchange Commission's supplemental order authorizing preliminary development activities and financing related to such activities and to acquisitions of interests in exempt wholesale generators ("EWGs") and foreign utility companies ("FUCOs") by Charter Oak (HCAR. No. 26134, September 30, 1994, File No. 70-8062, HCAR. No. 26213, December 30, 1994, File No. 70-8507, and HCAR. No. 26354, August 7, 1995, File No. 70-8507, HCAR, No. 26623, December 12, 1996, File No. 70-8507). (1) BALANCE SHEET AS OF DECEMBER 31, 1997: Attached as Exhibit A. (2) TWELVE MONTH INCOME STATEMENT ENDING DECEMBER 31, 1997: Attached as Exhibit B. (3) GENERAL DESCRIPTION OF THE ACTIVITIES OF CHARTER OAK FOR THE QUARTER ENDED DECEMBER 31, 1997, AND OF THE PROJECTS IN WHICH CHARTER OAK OR ITS SUBSIDIARIES HAVE AN INTEREST: During the fourth quarter of 1997, pursuant to the permission granted by the Commission in the September 30, 1994 (HCAR. No. 26134), December 30, 1994 (HCAR. No. 26213), August 7, 1995 (HCAR. No. 26354) and December 12, 1996 (HCAR. No. 26623) orders, Charter Oak, through its wholly-owned subsidiary COE Development Corporation ("COE Development"), has participated in preliminary development activities for EWGs and FUCOs. These activities have been performed by COE Development both on its own and with unaffiliated third parties. On August 7, 1995 the Commission authorized NU to make investments in Charter Oak, and Charter Oak to make investments in COE Development, in the amount of up to $400 million, through December 31, 1996, for preliminary development activities and for acquisitions of interests in EWGs and FUCOs. This authorization includes preliminary development of domestic projects as well as investments in EWGs and FUCOs. On December 12, 1996, this authority was extended to December 31, 1997 with the authorized amount of investment reduced to $200 million. The Commission extended the authority to December 31, 1998 on December 30, 1997. On December 5, 1995, Charter Oak filed a Form U-57 notifying the Commission of foreign utility company status for Ave Fenix Energia S.A. ("Ave Fenix"), the 168 MW natural gas project in the Republic of Argentina. Charter Oak through its wholly-owned subsidiary COE Ave Fenix Corporation, will own approximately 83% of the issued and outstanding common stock of Ave Fenix. On January 27, 1997, Ave Fenix closed on a $44 million term loan. Charter Oak is in the process of selling its interest in this project. On December 8, 1995, the 114 MW natural gas-fired project (Central Termica San Miguel de Tucuman, S.A., "C.T.S.M.T.") located in the Republic of Argentina commenced commercial operation. Charter Oak, through its wholly- owned subsidiary COE Argentina II Corp. owns 33.33% of the issued and outstanding common stock of C.T.S.M.T. In the fourth quarter of 1997, Charter Oak sold its interest in the project and filed Form U-57/A notifying the Commission that Foreign Utility Company status was no longer required with respect to NU and its subsidiaries' interest in the project. On June 24, 1996, the Plantas Eolicas S.A., the 20 MW wind project in Costa Rica, synchronized with the grid. Charter Oak, through its wholly-owned subsidiary COE Tejona Corporation, will own approximately 65% of the issued and outstanding common stock of Plantas Eolicas. It is anticipated that a Costa Rican company will hold the remaining 35% of the common stock of Plantas Eolicas. Charter Oak is trying to sell its interest in this project. Charter Oak, through its wholly-owned subsidiary Charter Oak (Paris), Inc., pursuant to the permission granted by the Commission (HCAR. No. 24893), has an approximately 10% beneficial equity ownership interest in a 223 MW gas-fired operational qualifying cogeneration facility in Paris, Texas. In the fourth quarter of 1997, Charter Oak sold its interest in the project. On September 24, 1993, NU was granted permission (HCAR. No. 70-8084) to invest up to $7 million in Charter Oak for the purchase of an interest in two non-utility subsidiaries to own an interest in a foreign utility company, Encoe Partners. Encoe Partners is a general partnership formed for the sole purpose of building, owning and operating a power generating facility in the United Kingdom ("Power Plant") and acquiring a one-third interest in certain rights and obligations under a power contract. The Power Plant is 2.176 MW and will produce power by harnessing the pressure in the natural gas pipeline feeding the 1,875 MW Teesside Project in Teesside, Wilton, Cleveland, England. This transaction was completed by Charter Oak on the close of business on September 30, 1993 by acquiring interests in two non-utility subsidiary companies, COE (UK) Corp. and COE (GENCOE) Corp. In the fourth quarter of 1997, Charter Oak sold its interest in the project and filed Form U-57/A notifying the Commission that Foreign Utility Company status was no longer required with respect to NU and its subsidiaries' interest in the project. At this time, none of the other projects Charter Oak is currently pursuing are sufficiently defined to move beyond the preliminary development stage and therefore are not contained in this report. (4) THE AMOUNTS OF RECOURSE AND NON-RECOURSE DEBT SECURITIES ISSUED TO THIRD PARTIES BY INTERMEDIATE COMPANIES: N.A. (5) REGULATORY STATUS OF FACILITIES ELIGIBLE FOR EXEMPTION AS A PUBLIC UTILITY UNDER THE ACT. N.A. (6) INFORMATION ON INTERCOMPANY SERVICE TRANSACTIONS INVOLVING AFFILIATED INTERMEDIATE COMPANIES, EWGs AND FUCOs FOR THE QUARTER ENDING DECEMBER 31, 1997. Attached as Exhibit C. The aggregate amount of all guarantees issued by or for Charter Oak or any of its subsidiary companies for the quarter ending December 31, 1997 is approximately $20 million. SIGNATURE Pursuant to the requirements of the Public Utility Holding Company Act of 1935, the undersigned company has duly caused this Certificate to be signed on its behalf by the undersigned thereunto duly authorized. Charter Oak Energy, Inc. /s/ Eugene G. Vertefeuille Principal Charter Oak Energy, Inc. P.O. Box 270 Hartford, CT 06141-0270 February 28, 1998 EXHIBIT A CHARTER OAK ENERGY, INC. AND SUBSIDIARIES ----------------------------------------- CONSOLIDATED BALANCE SHEETS (UNAUDITED) --------------------------------------- December 31, --------------------------- 1997 1996 ------------ ------------ (Thousands of Dollars) ASSETS - ------ Utility Plant, at original cost: Electric $ 52 $ 52 Less: Accumulated provision for depreciation 52 49 ------------ ------------ Total net utility plant - 3 ------------ ------------ Current Assets: Cash 1,637 2,843 Accounts receivable 14 84 Taxes receivable 4,364 1,522 Investments held for sale 33,391 57,188 ------------ ------------ 39,406 61,637 ------------ ------------ Deferred Charges: Accumulated deferred income taxes 1,028 130 Deferred development costs 4,335 9,348 Other 296 595 ------------ ------------ 5,659 10,073 ------------ ------------ Total Assets $ 45,065 $ 71,713 ============ ============ CAPITALIZATION AND LIABILITIES - ------------------------------ Capitalization: Common stock $ - $ - Capital surplus, paid in 102,344 87,651 Retained earnings (58,129) (18,126) ------------ ------------ Total capitalization 44,215 69,525 ------------ ------------ Minority interest in common equity of subsidiaries - (28) ------------ ------------ Current Liabilities: Accounts payable 205 459 Accounts payable to affiliated companies 400 235 Taxes accrued 25 1,229 Other 220 293 ------------ ------------ 850 2,216 ------------ ------------ Total Capitalization and Liabilities $ 45,065 $ 71,713 ============ ============ EXHIBIT B CHARTER OAK ENERGY, INC. AND SUBSIDIARIES ----------------------------------------- CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) --------------------------------------------- Twelve Months Ended December 31, --------------------------- 1997 1996 ------------ ------------ (Thousands of Dollars) Operating Revenues $ - $ - ------------ ------------ Operating Expenses: Operation and maintenance 8,199 4,511 Depreciation 896 435 Federal and state income taxes (3,678) (1,108) Taxes other than income taxes 247 21 ------------ ------------ Total operating expenses 5,664 3,859 ------------ ------------ Operating Loss (5,664) (3,859) ------------ ------------ Other (Loss)/Income: Investment (loss)income (4,642) 2,488 Other, net (1,328) (36) Loss on sale of investments (3,344) - Reserve for the loss on sale of COE Ave Fenix Corp.'s investment in Ave Fenix Energia, S.A. (25,000) - ------------ ------------ Total other (loss)/income (34,314) 2,452 ------------ ------------ Loss before interest charges (39,978) (1,407) ------------ ------------ Interest Charges 25 15 ------------ ------------ Net Loss $ (40,003) $ (1,422) ============ ============ EXHIBIT C Charter Oak Energy and Subsidiaries Detail of Intercompany Services Twelve Months Ended December 31, 1997 Charter Oak Energy ------------------ NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - ----------------------------------------------------------------------------- NUSCO Charter Oak staff 3,617,240 146,590 3,763,830 Accounting and financial services 37,941 12,928 50,869 Legal services 6,394 38,112 44,506 Miscellaneous 29,658 5,961 35,619 ------------------------------ Total NUSCO Services 3,691,233 203,591 3,894,824 ------------------------------ NU PARENT Retainer Fee 0 200,000 200,000 ------------------------------ Total NU PARENT Services 0 200,000 200,000 CL&P Miscellaneous 0 2,522 2,522 Reallocate Refund of CCBT Audit 0 (75,518) (75,518) ------------------------------ Total CL&P Services 0 (72,996) (72,996) ------------------------------ COE TEJONA Outside Services 0 428 428 ------------------------------ Total COE Tejona Services 0 428 428 ------------------------------ CHARTER OAK DEVELOPMENT CORP Legal services 0 634,288 634,288 CT Use Tax Recoupment 0 (107,816) (107,816) Outside Services 0 1,164 1,164 Miscellaneous 0 42,437 42,437 ------------------------------ Total COD Services 0 570,073 570,073 ------------------------------ Total Services Provided 3,691,233 901,096 4,592,329 ============================== Charter Oak Paris, Inc. ----------------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - ---------------------------------------------------------------------------- CL&P Miscellaneous 0 (7,628) (7,628) ------------------------------ Total CL&P Services 0 (7,628) (7,628) ------------------------------ Total Services Provided 0 (7,628) (7,628) ============================== COE Development Corp. --------------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - ----------------------------------------------------------------------------- NUSCO Charter Oak staff 634,478 378,697 1,013,175 Legal services 0 21,210 21,210 Miscellaneous 2,427 0 2,427 ------------------------------ Total NUSCO Services 636,905 399,907 1,036,812 ------------------------------ CL&P Employee Expenses 1,502 288 1,790 Reallocate CCB Tax Paid 1994,5,6 0 589,758 589,758 Outside Services 0 18 18 ------------------------------ Total CL&P Services 1,502 590,064 591,566 ------------------------------ PSNH Engineering Services 0 329 329 ------------------------------ Total PSNH Services 0 329 329 CHARTER OAK ENERGY Miscellaneous 0 650 650 CT Use Tax Adjustment 0 (5,310) (5,310) Outside Services 0 11 11 Legal Services 0 1,747 1,747 ------------------------------ Total COE Services 0 (2,902) (2,902) ------------------------------ COE TEJONA CORP. Outside Services 0 13,000 13,000 ------------------------------ Total COE Services 0 13,000 13,000 ------------------------------ Total Services Provided 638,407 1,000,398 1,638,805 =============================== COE (UK) Corp. -------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - --------------------------------------------------------------------------- NUSCO Charter Oak staff 4,503 3,589 8,092 Accounting and Financial Services 103 0 103 ------------------------------ Total NUSCO services 4,606 3,589 8,195 ------------------------------ CHARTER OAK DEVELOPMENT CORP. Miscellaneous 0 4,532 4,532 Outside Services 0 (23) (23) ------------------------------ Total COD services 0 4,509 4,509 ------------------------------ Total Services Provided 4,606 8,098 12,704 ============================== COE Argentina I Corp. ---------------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - -------------------------------------------------------------------------- NUSCO Charter Oak Staff 0 75 75 Accounting Staff 71 0 71 ----------------------------- Total NUSCO services 71 75 146 CL&P Reallocate CCB Tax Paid 1996 0 242 242 ------------------------------ Total CL&P Services 0 242 242 Total Services Provided 71 317 388 ============================= COE (GENCOE) Corp. ---------------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - ---------------------------------------------------------------------------- NUSCO Miscellaneous 141 0 141 ----------------------------- Total Services Provided 141 0 141 ============================== COE Argentina II Corp. ---------------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - -------------------------------------------------------------------------- NUSCO Miscellaneous 0 11,083 11,083 Charter Oak Staff 25,243 659 25,902 ----------------------------- Total NUSCO Services 25,243 11,742 36,985 CL&P Reallocate CCB Tax Paid 1996 0 (6,248) (6,248) ----------------------------- Total CL&P Services 0 (6,248) (6,248) COE Development Outside Services 0 42,276 42,276 Legal Services 0 771 771 ------------------------------ Total COE Development Services 0 43,047 43,047 CHARTER OAK ENERGY Outside Services 0 1,032 1,032 ------------------------------ Total COE Services 0 1,032 1,032 ------------------------------ Total Services Provided 25,243 49,573 74,816 ============================== COE Tejona Corp. ---------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - --------------------------------------------------------------------------- NUSCO Miscellaneous 4,345 0 4,345 Internal Audit 1,085 0 1,085 Accounting Services 106 0 106 Wholesale Marketing 3,461 0 3,461 Charter Oak Staff 142,010 53,167 195,177 Legal Services 0 2,170 2,170 ------------------------------ Total NUSCO Services 151,007 55,337 206,344 CL&P Reallocate CCB Tax Paid 1996 0 302 302 Employee Expense 4,322 1,166 5,488 ------------------------------- Total CL&P Services 4,322 1,468 5,790 COE Development Charter Oak Staff 0 81,473 81,473 Outside Services 0 294 294 CT Use Tax Recoupment 0 (88,256) (88,256) Legal Services 0 3,107 3,107 ------------------------------ Total COE Development Services 0 (3,382) (3,382) CHARTER OAK ENERGY Charter Oak Staff 0 1,925 1,925 Legal Services 0 115 115 Outside Services 0 543 543 ------------------------------ Total COE Services 0 2,583 2,583 ------------------------------ Total Services Provided 155,329 56,006 211,335 ============================== COE AVE FENIX Corp. ---------------- NON- Service Provided By- Type of Services Provided- PAYROLL PAYROLL TOTAL - --------------------------------------------------------------------------- NUSCO Miscellaneous 36,300 6,077 42,377 Outside Services 0 63 63 ------------------------------ Total NUSCO Services 36,300 6,140 42,440 CL&P Reallocate CCB Tax Paid 1996 0 242 242 ------------------------------- Total CL&P Services 0 242 242 COE Development Charter Oak Staff 0 9,229 9,229 Outside Services 0 7,315 7,315 CT Use Tax Recoupment 0 (51,832) (51,832) Miscellaneous 0 120 120 ------------------------------- Total COE Development Services 0 (35,168) (35,168) Total Services Provided 36,300 (28,786) (7,514) ============================== -----END PRIVACY-ENHANCED MESSAGE-----