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PNM REACHES AGREEMENT ON RECOVERY OF TAKE-OR-PAY COSTS

 ALBUQUERQUE, N.M., Jan. 7 /PRNewswire/ -- Gas Co. of New Mexico, a division of Public Service Co. of New Mexico (PNM) (NYSE: PNM) signed a stipulated agreement with the New Mexico Public Service Commission (NMPSC) staff and other intervenors which calls for the recovery of $60.5 million of gas contract settlement and take-or-pay costs over a five-year period. To adjust its previously established reserves for this item, PNM will take a one-time charge of $2 million or 3 cents per share.
 In a September 1990 filing, PNM had sought to recover $76 million of these costs, plus simple interest at the statutory rate of 9 percent per year. That request was subsequently modified to approximately $68 million to reflect PNM's concurrence with the positions of the NMPSC Staff and the New Mexico Attorney General regarding the classification of certain payments as take-or-pay costs instead of contract settlements. On March 11, 1992, the Hearing Examiner recommended recovery of $57.3 million (before interest) of these costs.
 The stipulated agreement to the Hearing Examiner must be approved by the NMPSC before recovery of these costs may begin. PNM anticipates that the Hearing Examiner will promptly recommend the stipulation to the NMPSC.
 If approved, this settlement would conclude two years of discovery, NMPSC hearings, and negotiations with intervenors.
 -0- 1/7/93
 /CONTACT: Michael Temple, 505-848-2210, Sam Brothwell, 505-848-2287, or Pam Lett, 505-848-4673, all of Public Service Co. of New Mexico/
 (PNM)


CO: Public Service Co. of New Mexico; Gas Co. of New Mexico ST: New Mexico IN: UTI SU:

MC -- DV003 -- 2671 01/07/93 12:19 EST
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Publication:PR Newswire
Date:Jan 7, 1993
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