Equitable Resources Receives State Approval of Utility Acquisition, Prepares to Challenge Federal Trade Commission's Interference
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PITTSBURGH, April 13: While welcoming the Pennsylvania Public Utility Commission's (PUC) order approving its acquisition of Dominion Peoples, Equitable Resources Inc. (NYSE:EQT) announced it will challenge the Federal Trade Commission's (FTC) intrusion into a state utility issue -- an intrusion that is robbing western Pennsylvanians of jobs and more than $160 million in customer cost savings.
On April 13, the PUC approved Equitable Resources' purchase of Dominion Peoples, a local natural gas distribution company, finding the acquisition will affirmatively promote the public interest in a substantial way. On the same day, the FTC filed a request for a preliminary injunction in federal district court in western Pennsylvania to stop the sale, claiming it would result in a monopoly of the natural gas utility industry in western Pennsylvania and thwart competition.
"The FTC claims are without merit," said Randall L. Crawford, senior vice president of Equitable Resources. "Public utilities are natural monopolies whose daily operations and rates are regulated by state public utility commissions. The FTC's action exhibits a clear lack of understanding about Pennsylvania's strict regulation of the natural gas distribution industry and reinforces why this is a state, not federal, matter.
"This acquisition will add jobs, result in customer cost savings and improve competition in natural gas supply," Crawford continued. "There never has been an acquisition that makes more sense for western Pennsylvania natural gas customers or our communities."
As for the acquisition allegedly stopping competition, the PUC also decided in its April 13 ruling that the settlement will promote development of a competitive natural gas supply market. "Equitable's commitment to collaborate with natural gas marketers will provide a competitive market that will benefit all customers," Crawford said. "Customer gas supply options will increase after the acquisition." PUC Commissioner Fitzpatrick, in his statement accompanying the order, also recognized that increased gas supply competition has "the potential to benefit all customers."
Additionally, the FTC's action in a state review process is depriving almost 750,000 customers the job opportunities and gas cost savings that will result from the acquisition. In fact, the FTC's action has forced Equitable to postpone recently the hiring of 150 people, including 100 at the Johnstown call center. The FTC action to stop the acquisition also is jeopardizing $10 million in annual customer gas cost savings, and approximately $150 million in capital cost savings that would be realized over time by reducing the costs of operating and maintaining duplicative utility lines.
Equitable Resources is an integrated energy company that produces, transports, supplies and distributes natural gas throughout primary operations in Pennsylvania, West Virginia, Kentucky, and Virginia. It is the largest natural gas supplier in the Appalachian basin. For additional information on Equitable, visit http://www.eqt.com/.
Source: Equitable Resources, Inc.
CONTACT: Patricia Kornick Equitable Resources, Inc., +1-412-553-5738Web site: http://www.eqt.com/
