Dominion Resources Announces Major Organizational
Restructuring
RICHMOND, VA -- Dominion Resources Inc. (NYSE: D) today announced
a major restructuring of the company effective May 1 that will separate two
current subsidiaries, Virginia Power and Dominion Energy, into one generating
subsidiary and one transmission and distribution subsidiary.
"Our pending merger with Consolidated Natural Gas - combined
with the passage of legislation in Virginia that will create competition among
electric generators - presents us with the perfect opportunity to restructure
Dominion Resources during this critical transition period in our industry,"
said Thos. E. Capps, chairman, president and chief executive officer. Capps
also announced the retirement of Norman Askew, president and chief executive
officer of Virginia Power, effective May 1.
Capps said: "Norman has done a terrific job in getting Virginia
Power positioned for the competitive marketplace. The fast pace of the changes
he has made has gotten us to this point much more quickly than we anticipated
two years ago, and we are now ready to take the organization through the process
of unbundling. What Norman has accomplished so well at Virginia Power forms
the basis for this broader restructuring of Dominion Resources."
Askew said: "These have been a wonderful two years. We have
continued to improve operational performance, we have stepped up our investment
in customer service, and we have reorganized the business with a strong management
team. The rate case settlement in 1998 followed by the 1999 legislation to deregulate
Virginia Power makes this reorganization and the creation of Dominion Generation
the next step in the process."
The reorganization, which was approved by the Dominion Resources
board of directors at its April 16th meeting, will separate Virginia Power into
two distinct companies. The management of a new subsidiary, Dominion Generation,
will be responsible for the 80 fossil, nuclear and hydroelectric units owned
and operated in Virginia, West Virginia and North Carolina by Virginia Power
and the 24 generating facilities in five U.S. states, Argentina, Belize, Bolivia
and Peru in which Dominion Energy has operating and ownership interests.
It will also hold a generating facility owned by Dominion
Resources in the United Kingdom. Dominion Generation will also house the wholesale
trading operations based at Virginia Power and all of the utility’s independent
power contracts.
Thomas F. Farrell II will be chief executive officer of the
new company, and James P. O’Hanlon will be president and chief operating officer.
Farrell is currently executive vice president of Dominion Resources and Virginia
Power, and O’Hanlon is senior vice president of nuclear operations at Virginia
Power."
Dominion Generation’s leadership team will be responsible
for the management of all of our generating assets although Virginia Power’s
assets will be wholly owned by the utility pending full implementation of the
legislation passed this winter by the Virginia General Assembly," Capps said.
That legislation, known as Senate Bill 1269, establishes
a comprehensive plan for the state’s transition to competition in the electric
utility industry and deregulates all generation in the state as of January 1,
2002.
Capps said: "This is a natural unification of Virginia Power’s
decades of operating excellence in regulated generation with Dominion Energy’s
10-plus years of experience in competitive energy markets throughout the Americas."
The second new subsidiary will retain the name Virginia Power
and will house all of the utility’s current retail activities, customer service
tasks, transmission and distribution assets and operations, and all staff support
functions. Virginia Power will be headed by Edgar M. Roach Jr. as chief executive
officer and Robert E. Rigsby as president and chief operating officer. Roach
is currently executive vice president and chief financial officer of Dominion
Resources, and Rigsby is currently executive vice president of Virginia Power.
"The new Virginia Power will form the basis of what will
always remain a regulated company," Capps said. "We will continue our traditional
superior commitment to fast and efficient customer service."
Capps also announced the election of Thomas N. Chewning,
currently president and chief executive officer of Dominion Energy, as executive
vice president and chief financial officer of Dominion Resources. Chewning will
continue to oversee all of Dominion Energy’s gas exploration and production
activities pending completion of Dominion Resources’ merger with Consolidated
Natural Gas.
Capps also announced the election of Eva S. Teig as senior
vice president for external affairs and corporate communications at Dominion
Resources. Teig will head these functions for Dominion Resources and all its
subsidiaries. She is currently senior vice president for external affairs and
corporate communications at Virginia Power.
Capps said: "With this new team, we are extremely well-positioned
to move ahead. These changes will benefit our shareholders, customers and employees.
They position Dominion Resources for tremendous success in the 21st century
global and domestic energy marketplace."
