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Oct. 3-7: Dynegy debt restructuring; Matthew's damage

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Oct. 3-7: Dynegy debt restructuring; Matthew's damage

A brief lookback at successes and setbacks in the energy industry.

Highs

DYNEGY — DynegyInc. shares climbed nearly 6% on Oct. 3 after the company withbondholders to restructure $825 million in unsecured debt at its subsidiary. The deal was viewedpositively by Wall Street for alleviating concerns around debt andthe future of the business unit. "[T]his is a more appropriate structure for what weacknowledge are lower quality assets as they still generate cash, and weappreciate continued effort to remove uncertainty, cost, and complexity fromthe business," Guggenheim Securities LLC analyst Shahriar Pourrezawrote.

TCEH — Thenewly formed TCEHCorp. saw its shares begin trading Oct. 4 under the ticker symbol THHH. TCEHis the new stand-alone retail power and generation business formed afterEnergy Future HoldingsCorp. subsidiary Texas Competitive Electric Holdings Co. LLC wasspun off to senior creditors as part of the Chapter 11 process. The companysaid it has eliminated more than $33 billion in debt and other obligationsthrough bankruptcy reorganization, and has an available liquidity positionestimated at $1.65 billion. "[T]he long-term potential of our integratedbusiness, combining an innovative, customer-focused retail business with asafe, reliable, cost-effective generation company, is extremely powerful,"TCEH CEO Curt Morgan said.

ARCH — Arch Coalreturned to the stock market Oct.5 after emerging from bankruptcy and managing to maintain ownershipof its top mines. LucasPipes, an analyst with FBR & Co., hailed Arch as the "New King Coal" in a noteahead of the announcement, ranking it "outperform," in his noteinitiating coverage. "Whilewe always considered Arch a strong operator, we believe the company is nowpositioned to prosper in almost any coal price environment," Pipeswrote. Arch shares were, however, trading lower by the end of the week from an openingprice of $70.

CLOUD PEAK — Cloud Peak Energy Inc. has U.S. Interior Departmentclearance to expandits Spring Creek mine in Montana after the U.S. Office of Surface Mining Reclamation and Enforcementreleased a "finding of no significant impact." The OSMRE saidthat a new Environmental Assessment found the expansion's contribution togreenhouse gas emissions to Wyoming, Montana and U.S. totals "would beminor to moderately adverse and short-term" and that "none of theenvironmental effects discussed in the [environmental assessment] are consideredto be significant." A representative for WildEarth Guardians, which foughtthe expansion, said the group was disappointed.

Between

FPL — Florida Power &Light Co. announced Oct. 6 that it with keyintervenors in its rate case. Though the settlement's terms reduced the rateincreases FPL asked for, analysts greeted news of the stipulation warmly sinceit leaves the NextEra EnergyInc. subsidiary's ROE intact and includes a provision to add 1.2 GWof utility-scale solar to rate base. Earlier in the week, from stateregulators to acquire Indiantown, a 330-MW coal plant it intends to retire.But the utility spent much of the week preparing for and dealing with damage caused byHurricane Matthew.

Lows

MATTHEW — Hurricane Matthew was a Category 3 storm as it made its wayup Florida's Atlantic coast, though some miles offshore, on Oct. 7, and leftroughly 1 millioncustomers without power in the Sunshine State alone. The EdisonElectric Institute said more than 3.2 million customers of its member companieswere impacted by the storm, though 61% of those customers had power restored asof Oct. 9.

SOUTHERN — MississippiPower Co. on Oct. 3 disclosed another delay to when its controversialintegrated gasification combined-cycle generation project in Kemper County isplanned to enter service. The Southern Co. utility now aims for Kemper to begincommercial operation by Nov. 30, a month later than the previous target.Mississippi Power also increased its previous cost estimate by $33 million,bringing the total project cost to $6.89 billion through August 2016.

DON BLANKENSHIP — Former Massey Energy CEO Don Blankenshipissued a public statement from prisondeclaring himself an "American Political Prisoner" and indicatingplans to issue a booklet that he said will shed new light on the Upper BigBranch mine explosion and show "how horribly broken our American judicial system has become."U.S. Attorney Booth Goodwin responded that Blankenship's statementdemonstrates, "that he stillhas not learned this lesson: if you gamble with miners lives, you deserve to goto prison."

FERC — A judge for the U.S. District Court for the Districtof Columbia ruled Oct.5 that FERC needs to pay $60,168.19 in legal fees related to a Freedomof Information Act dispute to the brothers, Rich and Kevin Gates, who co-ownPowhatan Energy Fund. FERC asked a federal district court to enforce $16.8million in penalties it assessed Powhatan for allegedly manipulating 's powermarkets, but the firm's owners have fought back fiercely that they are being"bullied," by the commission. "FERC's unjust withholding of FOIA documents is disgusting,"Rich Gates said. "We are appreciative of Judge Bates who said we have donea public service seeking them."