PSEG Resources Agrees to Terminate Its Investment in the Collins Generating Facility
March 15 2004 - 9:41AM
PR Newswire (US)
PSEG Resources Agrees to Terminate Its Investment in the Collins
Generating Facility NEWARK, N.J., March 15 /PRNewswire-FirstCall/
-- PSEG Resources, an indirect subsidiary of Public Service
Enterprise Group (PSEG) and a direct subsidiary of PSEG Energy
Holdings LLC today (March 15, 2004) announced an agreement with
Midwest Generation LLC, an indirect subsidiary of Edison Mission
Energy (EME), to terminate its lease investment in the Collins
generating facility in Illinois. The lease termination is
contingent on several conditions, including Midwest Generation's
successfully borrowing funds to finance the repayment of lease debt
of $774 million and settle its termination liability with Resources
as lease equity investor. As a result, no closing date has been
set. Eileen A. Moran, president of PSEG Resources, which makes
energy-related investments, said that, under the proposed
termination agreement, Resources would receive pre-tax proceeds of
approximately $184 million of cash. "These proceeds, which include
deferred taxes and accrued earnings since the lease's inception in
1999, would allow Resources to substantially recover its investment
of $199 million, as of December 31, 2003," she said. "The lease
termination would also reduce Resources' as well as PSEG's overall
risk exposure to EME, with which it has a lease investment
involving Powerton and Joliet, two other Illinois generating
facilities also operated by Midwest Generation." PSEG expects to
incur a loss upon termination of the Collins lease of approximately
7 cents per share of its common stock. PSEG Resources maintains a
diverse portfolio comprised largely of assets related to energy
infrastructure financing. Its portfolio is valued at about $3
billion. FORWARD-LOOKING STATEMENT Readers are cautioned that
statements contained in this press release about our and our
subsidiaries' future performance, including future revenues,
earnings, strategies, prospects and all other statements that are
not purely historical, are forward-looking statements for purposes
of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995. Although we believe that our
expectations are based on reasonable assumptions, we can give no
assurance they will be achieved. The results or events predicted in
these statements may differ materially from actual results or
events. Factors which could cause results or events to differ from
current expectations include, among other things: the effects of
weather; the performance of generating units and transmission
systems; the availability and prices for oil, gas, coal, nuclear
fuel, capacity and electricity; changes in the markets for
electricity and other energy-related commodities; changes in the
number of participants and the risk profile of such participants in
the energy marketing and trading business; the effectiveness of our
risk management and internal controls systems; the effects of
regulatory decisions and changes in law; changes in competition in
the markets we serve; the ability to recover regulatory assets and
other potential stranded costs; the outcomes of litigation and
regulatory proceedings or inquiries; the timing and success of
efforts to develop domestic and international power projects;
conditions of the capital markets and equity markets; advances in
technology; changes in accounting standards; changes in interest
rates and in financial and foreign currency markets generally; the
economic and political climate and growth in the areas in which we
conduct our activities; and changes in corporate strategies. For
further information, please refer to our Annual Report on Form 10-K
and subsequent reports on Form 10-Q and Form 8-K filed with the
Securities and Exchange Commission. These documents address in
further detail our business, industry issues and other factors that
could cause actual results to differ materially from those
indicated in this release. In addition, any forward-looking
statements included herein represent our estimates only as of today
and should not be relied upon as representing our estimates as of
any subsequent date. While we may elect to update forward-looking
statements from time to time, we specifically disclaim any
obligation to do so, even if our estimateschange, unless otherwise
required by applicable securities laws. DATASOURCE: Public Service
Enterprise Group CONTACT: Leslie Cifelli of Public Service
Enterprise Group, +1-973-430-3809 Web site: http://www.pseg.com/
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