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Dominion News Releases
February 24, 2000
Dominion Resources Will Top Entergy Offer For New York Nuclear
Units
Richmond, Va.-- Dominion Resources Inc. (NYSE: D), the nation's
top nuclear operator, announced today that it will offer $686 million for the
New York Power Authority's Indian Point 3 and James A. FitzPatrick nuclear stations,
topping by more than 12 percent a $611 million bid made by Entergy Corp. of
New Orleans for the two nuclear plants.
Dominion expects the acquisition would be immediately accretive
to earnings per share.
Thos. E. Capps, president and chief executive officer, said:
"This offer is consistent with our strategy to expand our
electric generation portfolio in the Midwest-Northeast quadrant of the U.S.,
home to 40 percent of the nation's demand for energy.
"It is also good for New York's energy consumers. Dominion
is the nation's most efficient operator of nuclear power units. This opportunity
allows us to bring our record of uncompromising safety, low-cost generation,
and superior service to all classes and categories of energy customers throughout
the state and the region."
Dominion also offered $171 million in consideration for reactor
fuel, matching Entergy's offer.
Dominion owns and operates the North Anna Power Station,
which has two 950-megawatt pressurized water reactors, and the Surry Power Station,
which has two 850-megawatt pressurized water reactors. All four units have reactors
designed by Westinghouse.
In a recent Nucleonics Week magazine study of the
top 50 nuclear facilities, North Anna Unit 1 ranked first in the world and Surry
Unit 1 ranked seventh in the world in capacity factor.
From 1990 to 1999, Dominion improved the nuclear capacity
factor at North Anna and Surry, culminating at 95.2 percent in 1999, the highest
level experienced by the company. By contrast, the average capacity factor for
the U.S. nuclear industry in 1999 was 84.5 percent.
A nuclear unit's capacity factor measures the ratio of the
energy generated over a period of time compared to the total energy that could
be generated if the units ran at full power 100 percent of the time.
The high capacity factors are indicative of two other measures
of superior performance – the duration of refueling outages and unplanned outage
rates. During the same period, Dominion reduced refueling outage days by 53
percent and the unplanned outage rate by 74 percent, to 0.9 percent in 1999.
In the 1990s, North Anna and Surry received consistently
high marks for safety and excellent operations from the U.S. Nuclear Regulatory
Commission and the Institute of Nuclear Power Operations.
Also, no other U.S. nuclear power station has produced electricity
as inexpensively as North Anna and Surry in the 1990s. For example, in 1998
Surry was the nation's lowest-cost producer of nuclear-generated electricity
while North Anna was No. 2. The rankings, the most recent available, are done
annually by the independent Utility Data Institute and Nucleonics Week.
North Anna's production costs have been the lowest in the
nation for the last seven consecutive three-year cycles. Three-year cycles more
accurately reflect the impact of refueling outages, which occur every 18 months,
on production costs.
Dominion is also known for its progressive management style,
which is focused on developing leadership and expertise from within. The company
provided several members to Northeast Utilities' leadership team for the successful
recovery and restart of its Millstone Unit 2.
NYPA's FitzPatrick station is an 800-megawatt single unit
boiling water reactor designed by General Electric near Oswego on Lake Ontario.
Indian Point 3 is a 980-megawatt Westinghouse Electric pressurized water reactor
on the Hudson River outside New York City.
Dominion Resources, headquartered in Richmond, Va., is the
largest fully-integrated natural gas and electric power provider in the U.S.
The company serves 4 million retail gas and electric customers in five states.
It has 20,000 megawatts of electric generating capacity, with 6,000 megawatts
under development. Dominion is also one of the largest independent oil and natural
gas exploration and production companies in North America, with 3 trillion cubic
feet of reserves.
This press release contains forward-looking statements.
The company wishes to caution readers that the assumptions which form the basis
for forward-looking statements with respect to or that may impact earnings for
fiscal year 2000, and thereafter, include many factors that are beyond the company's
ability to control or estimate precisely, such as estimates of future market
conditions and the behavior of other market participants. Other factors include,
but are not limited to, weather conditions, economic conditions in the company's
service territories, fluctuations in energy-related commodity prices, conversion
activity, other marketing efforts and other uncertainties.
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Analysts
Thomas P. Wohlfarth; 804-819-2150
Media
Jim Norvelle; 804-819-2043
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