Sierra Pacific Resources Says New FERC Order Should Strengthen
Utilities' Case in Dispute With Enron
LAS VEGAS, March 14 /PRNewswire-FirstCall/ -- Sierra Pacific Resources (NYSE: SRP) today said that an order issued by the Federal Energy Regulatory Commission (FERC) on Friday, March 11, 2005, has positive implications with respect to an ongoing dispute between the company's two Nevada utilities and Enron Power Marketing Inc. over more than $300 million in terminated power contracts.
The company said the FERC order clearly asserts the commission's regulatory authority in a proceeding involving its subsidiaries, Nevada Power Company and Sierra Pacific Power Company, along with Snohomish (Washington) Public Utility District and several other utilities. In its order clarifying issues to be covered in a FERC trial scheduled to begin on June 13, 2005, the commission said, "Enron's profits under the terminated (forward power) contracts fall within the scope of this proceeding."
One part of Sierra Pacific Resources' dispute with Enron is currently before the Bankruptcy Court for the Southern District of New York with a trial scheduled to begin on April 18, 2005.
Walter Higgins, chairman and chief executive officer of Sierra Pacific Resources, said, "We believe this ruling by FERC supports our continuing efforts to convince the bankruptcy court hearing Enron's termination case that the federal agency governing the power marketplace is the appropriate venue to resolve any claims. The entirety of our contractual relationship with Enron was based on Enron's fraud, deceit and violation of FERC tariffs, rules and regulations. Since the Western energy crisis of 2000-2001, evidence of Enron's wrongful and oftentimes criminal actions continues to mount."
The FERC "Order of Clarification" issued Friday was in response to a motion filed, not only to the parties directly involved in the case, but also joined by the Nevada Attorney General's Bureau of Consumer Protection, the Public Utilities Commission of Nevada, and the Attorney General of the State of Washington.
Higgins added, "Compelling evidence of Enron's many fraudulent actions has been submitted to FERC and this ruling should help ensure that Enron will not be allowed to capture unjust profits through its wrongful termination of contracts from which it never even delivered the power. Any payment on such contracts would represent pure and unjust profit for Enron."
Headquartered in Nevada, Sierra Pacific Resources is a holding company whose principal subsidiaries are Nevada Power Company, the electric utility for most of southern Nevada, and Sierra Pacific Power Company, the electric utility for most of northern Nevada and the Lake Tahoe area of California. Sierra Pacific Power Company also distributes natural gas in the Reno-Sparks area of northern Nevada. Other subsidiaries include the Tuscarora Gas Pipeline Company, which owns 50 percent interest in an interstate natural gas transmission partnership.
This press release contains forward-looking statements regarding the future performance of Sierra Pacific Resources and its subsidiaries, Nevada Power Company and Sierra Pacific Power Company, within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to a variety of risks and uncertainties that could cause actual results to differ materially from current expectations. For Sierra Pacific Resources, these risks and uncertainties include, but are not limited to, the Company's ability to maintain access to the capital markets, its ability to receive dividends from its subsidiaries and the financial performance of the Company's subsidiaries, particularly Nevada Power Company and Sierra Pacific Power Company. For Nevada Power Company and Sierra Pacific Power Company, these risks and uncertainties include, but are not limited to, adverse decisions in the Enron litigation or other pending or future litigation, unfavorable rulings in their pending and future rate cases, their ability to maintain access to the capital markets for general corporate purposes, their ability to purchase sufficient power to meet their power demands and weather conditions during the summer months of 2005 and beyond. Additional cautionary statements regarding other risk factors that could have an effect on the future performance of Sierra Pacific Resources, Nevada Power Company and Sierra Pacific Power Company are contained in their Quarterly Reports on Form 10-Q for the quarter ended September 30, 2004, filed with the SEC. The Companies undertake no obligation to release publicly the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events.
SOURCE Sierra Pacific Resources
CONTACT: Media, Andrea Smith, +1-702-367-5683, or Analysts, Britta Carlson, +1-702-367-5624, both of Sierra Pacific Resources -0- Mar/14/2005 17:14 GMT