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NOVA CORP. ANNOUNCES ADJUSTMENTS TO AGTD'S 1994 RATE OF RETURN

 CALGARY, Alberta, Dec. 10 /PRNewswire/ -- NOVA Corp. of Alberta announced today an overall decrease in its rate of return on rate base for its Alberta Gas Transmission Division (AGTD). Effective Jan. 1, 1994, AGTD's total rate of return will decrease from 10.35 percent to 10.18 percent.
 AGTD's return on its rate base for 1994 includes a common equity component of 34 percent and a rate of return on common equity of 12.25 percent. For 1993, this return included a common equity component of 30 percent and a rate of return on common equity of 11.75 percent.
 NOVA CORP.
 AGTD Rate of Return Components; 1993 & 1994
 Percent of Capital Structure Cost Rates
 1993 1994 1993 1994
 Debt 65 61 10.17 9.49
 Preferred shares 5 5 6.16 5.86
 Common equity 30 34 11.75 12.25
 100 pct 100 pct 10.35+ 10.18+
 +weighted average rate of return
 These changes are driven by NOVA's analysis of 1994 capital market conditions and an aggressive 1994 pipeline expansion program. NOVA expects to spend some $600 million expanding its Alberta natural gas pipeline system in 1994. This increasing level of investment stems from a dramatic increase in requests for transportation capacity by AGTD's customers.
 Although constructive discussions were held with the Canadian Association of Petroleum Producers (CAPP), a negotiated settlement could not be reached on all issues respecting AGTD's rate of return and capital structure. CAPP has asked the Alberta Public Utilities Board to review AGTD's 1994 capital structure and rate of return.
 The impact of changes in AGTD's rate of return and deemed common equity on NOVA's consolidated net income can be generally summarized as follows:
 -- For each 1 percent change in AGTD's return on common equity, consolidated net income is expected to change by about $13 million;
 -- For each 1 percent change in AGTD's common equity, consolidated net income is expected to change by about $4 million.
 -0- 12/10/93
 /CONTACT: R.W. (Bob) Schmidt, VP, Regulatory Affairs, AGTD, 403-290-7683; or W.N. (Bill) Rowe, director, Investor Relations, 403-290-7807; or P.J. (Jeff) Flood, Public Affairs, 403-290-7657/
 (NVA.)


CO: NOVA Corp. ST: Alberta IN: UTI SU:

MF-JB -- LA042 -- 2847 12/10/93 18:51 EST
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Publication:PR Newswire
Date:Dec 10, 1993
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