Pittsburgh area energy firms: The cat that swallowed the canary
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Optimism is running high among three local energy companies that reported third-quarter earnings last week.
Allegheny Energy CEO Paul Evanson described his company's results as "strong," Consol Energy Inc. CEO J. Brett Harvey called the quarter "financially strong and operationally significant." And EQT Corp. CEO Dave Porges opened his conference call with analysts by noting a 30 percent-plus growth in the sale of produced natural gas.
The Marcellus Shale played a large part in that growth, making up 20 percent of Downtown-based EQT's gas sales, compared with 2 percent last year. The natural gas reserves that underlie much of Pennsylvania are also a major segment of Cecil-based Consol's portfolio, especially with the purchase of Dominion Resources Inc.'s Appalachian exploration and production assets earlier this year.
Even as they seek to grow some assets, Consol and EQT are seeking to sell off others.
Mr. Porges said EQT was "looking to monetize some of our assets." While he didn't say which assets were being considered for possible sale, he gave as examples "acreage that would not be drilled in a timely manner" or midstream assets like pipelines in lower growth areas.
Consol's Mr. Harvey confirmed interest in selling off noncore assets -- 300 million tons of metallurgical coal in central Appalachia.
Greensburg-based Allegheny Energy's top priority is its planned merger with Akron, Ohio-based FirstEnergy, which has passed muster with the Virginia State Corporation Commission; it's under review by the Pennsylvania, West Virginia and Maryland utility panels.
While awaiting those approvals, along with those from the Federal Energy Regulatory Commission and the Department of Justice, Allegheny is pressing two major projects.
The Trans-Allegheny Interstate Line, a 500-kV transmission line, has 97 percent of its towers completed and 76 percent of its wire installed and will go into service in June 2011. Another line, the 756-kilovolt Potomac-Appalachian Transmission Highline, is before the Virginia State Corporation Commission.
First Published November 2, 2010 12:00 am