COLUMBIA GAS ENTERS INTO CONDITIONAL AGREEMENT TO SELL LNG UNIT TO SHELL OIL SUBSIDIARY
COLUMBIA GAS ENTERS INTO CONDITIONAL AGREEMENT
TO SELL LNG UNIT TO SHELL OIL SUBSIDIARY
WILMINGTON, Del., Nov. 27 /PRNewswire/ -- The Columbia Gas System, Inc. (NYSE: CG) today announced a conditional agreement for the sale of Columbia LNG Corporation to Shell LNG Co., a subsidiary of Shell Oil Co. of Houston, Texas, for $128.5 million.
Columbia LNG owns a liquefied natural gas (LNG) importing terminal at CovePoint, Md.
Shell LNG would also arrange the refinancing of Columbia LNG's outstanding debt to The Columbia Gas System, Inc., to permit the repayment of that debt, estimated to be approximately $44 million at the time of final closing.
If several substantial conditions are met, Shell LNG will purchase 40.8 percent of Columbia LNG's stock for $45.75 million at an interim closing in July 1992 and another 50 percent of the stock for $64.25 million at a final closing which is expected to occur in March 1993. Shell LNG previously paid Columbia $18.5 million for 9.2 percent of Columbia LNG's stock.
Because The Columbia Gas System, Inc. is operating as a debtor-in- possession under Chapter 11 of the bankruptcy code, the sales agreement must be approved by the U. S. Bankruptcy Court for the District of Delaware. The sale must also be approved by the Securities and Exchange Commission under the Public Utility Holding Company Act of 1935, as amended.
Columbia LNG's Cove Point receiving terminal is the largest in the U.S with a design sendout capacity of one billion cubic feet of regasified LNG daily. Constructed in the 1970s, the terminal has been maintained in a standby state since 1980 when the last shipload of LNG was received and processed.
Subsidiaries of the Columbia Gas System are engaged in the exploration, production, purchase, storage, transmission and distribution of natural gas as well as other energy operations such as cogeneration. Columbia's transmission, storage and distribution facilities serve, directly or indirectly, more than 8 million gas consumers in 15 states and the District of Columbia.
/CONTACT: W.R. McLaughlin (media), 302-429-5443, or Dennis McFarland (financial), 302-429-5363, or 302-429-5000, both of Columbia Gas; or Norm Alstedter, 212-632-4888, or Holly Hutchins, 713-241-4544, both of Shell LNG Co./
(CG) CO: The Columbia Gas System, Inc.; Shell Oil Co.; Columbia LNG
Corporation; Shell LNG Co. ST: Delaware, Texas IN: OIL SU: RCN
JS-KA -- PH033 -- 7840 11/27/91 15:36 EST