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Nov. 27-Dec. 1: Enbridge unveils spending plan; CNX spins coal business

A look back at successes and setbacks in the energy industry.


ENBRIDGE — Enbridge Inc. on Nov. 29 unveiled a C$22 billion capital program as part of its post-Spectra Energy merger strategic plan, which also includes a goal to monetize C$10 billion in noncore assets and a 10% boost to its dividend. Enbridge also announced an effort to lower Spectra Energy Partners LP's cost of capital by eliminating its incentive distribution rights. The C$22 billion capital program through 2020 will prioritize three core businesses that Enbridge views as low-risk and strong growth platforms: liquids pipelines and terminals, gas transmission and storage, and gas utilities. Of the C$10 billion in noncore assets to be monetized or sold, at least C$3 billion would be divested or monetized by 2018.

CNX RESOURCES — CNX Resources Corporation announced Nov. 29 it completed the spinoff of its coal business to shareholders and transitioned into a pure-play oil and gas exploration and production company. In response, S&P Global Ratings raised its corporate credit rating on CNX Resources to BB- from B+ and removed the company from CreditWatch with a stable outlook.


CLEAN POWER PLAN — The U.S. Environmental Protection Agency held its sole hearing on the planned repeal of the Clean Power Plan on Nov. 28 and Nov. 29 in Charleston, W.Va. The decision to only hold one hearing riled environmentalists, while proponents of the proposed repeal applauded the location of the testimony and vowed to fight for coal miners. "We want to work with the EPA to put appropriate regulatory and judicial restraints in place so that the power plan never again sees the light of day," West Virginia Attorney General Patrick Morrisey said. "I also would like to work with Congress to put other statutory provisions [in place] to make it clear that the Clean Power Plan not only is unlawful, but it's bad policy as well."

KEMPER — Mississippi Power Co. on Dec. 1 filed a revised settlement agreement tied to cost recovery for the operating portion of the Plant Ratcliffe integrated gasification combined-cycle project in Kemper County, Miss. In response, the Mississippi Public Service Commission canceled a previously scheduled Dec. 4 hearing on the troubled facility. The Southern Co. subsidiary, alongside certain stakeholders, is now proposing that its overall retail annual revenue requirement for Kemper be $112.6 million, down from the $117.8 million agreed to by parties Nov. 22. The agreements come after Mississippi Power announced plans in late June to suspend its development of the coal gasification portion of the controversial generation project following years of delays and cost overruns. Mississippi Power has agreed to permanently remove from its rate base all costs of the coal gasifiers.


WILDFIRE COSTS — California regulators on Nov. 30 denied San Diego Gas & Electric Co.'s request to recover $379 million in litigation costs from wildfires in 2007. The California Public Utilities Commission concluded that the Sempra Energy utility did not reasonably manage and operate its facilities prior to the October 2007 Witch, Guejito and Rice wildfires. PG&E Corp. subsidiary Pacific Gas and Electric Co., facing exposure to future costs from wildfires that recently swept through its northern California service territory, and Edison International subsidiary Southern California Edison Co. said they all face the uncertainty of future damages because California courts tend to impose strict liability on utilities arising from wildfire damage claims.

CENTERPOINT — CenterPoint Energy Inc. on Dec. 1 pulled the plug on an agreement to sell its ownership stake in Enable Midstream Partners. CenterPoint and Enable were in late-stage discussions for the now-canceled sale, but it is now likely CenterPoint will sell down its stake through the public equity markets. Guggenheim Securities LLC on Dec. 4 downgraded CenterPoint to "neutral" from "buy" and lowered its price target to $30 from $32.

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