EDITORS: Please do not use
"Pacific Gas and Electric" or "PG&E" when
referring to PG&E Corporation or its National Energy Group.
The PG&E National Energy Group is not the same company as Pacific
Gas and Electric Company, the utility, and is not regulated by the
California Public Utilities Commission. Customers of Pacific Gas
and Electric Company do not have to buy products or services from
the National Energy Group in order to continue to receive quality
regulated services from Pacific Gas and Electric Company.
INTERNATIONAL, PG&E CORPORATION AND PRÓXIMA GAS, S.A. DE C.V., TO
DEVELOP MEXICO NATURAL GAS PIPELINE
SAN DIEGO and SAN FRANCISCO,
June 12, 2000 - Sempra Energy International (NYSE: SRE), PG&E Corporation
(NYSE: PCG) and Mexico's Próxima Gas, S.A. de C.V., today announced
that they will join forces to build the proposed North Baja Pipeline,
a $230 million, 212-mile natural gas transportation pipeline to
serve growing energy demand in Baja California, Mexico.
The three companies have
signed an interim agreement to jointly develop, design, construct
and operate the proposed pipeline. The project will begin at an
interconnection with El Paso Natural Gas Co. near Ehrenberg, Ariz.,
traverse southeastern California and northern Baja California, Mexico,
and terminate at an interconnection with the Rosarito Pipeline south
of Tijuana. The PG&E National Energy Group will direct development
of the 77-mile U.S. leg of the pipeline, while Sempra Energy International
will direct development of the 135-mile Mexican leg.
"We and Próxima Gas believe
this is a critical project in integrating the energy markets of
California and Northern Mexico," said Donald E. Felsinger, group
president of Sempra Energy and chairman of Sempra Energy International.
"By developing this new pipeline with PG&E Corporation - our third
project in Baja California - we will link our existing natural gas
assets in Rosarito and Mexicali and expand our capacity to deliver
a clean, reliable source of energy that will spur economic development
and improve air quality in the border region."
"This pipeline will deliver
much-needed natural gas supplies to Northern Mexico, where demand
is growing rapidly, providing a new link between Southwest U.S.
natural gas supplies and the Mexico market," said Thomas B. King,
president, West Region, for the PG&E National Energy Group. "For
PG&E Corporation's National Energy Group, the project will broaden
our presence as a natural gas transportation provider in western
North American markets."
If approved, the proposed
pipeline could be in service as early as January 2003, with a gas
transportation capacity of approximately 400 million cubic feet
per day at rates competitive with existing alternatives. The initial
design calls for a 30-inch pipeline and one compressor station in
The U.S. segment of the
pipeline will be regulated by the U.S. Federal Energy Regulatory
Commission and the Mexican segment by the Mexican Energy Regulatory
Commission (CRE). Sempra Energy International filed for a natural
gas transportation permit with the CRE in March of this year.
The primary target markets
for the pipeline are power plants and energy-intensive industries
in Baja California. Currently, the Mexican Federal Electricity Commission
(CFE) has plans to convert the existing Presidente Juárez Power
Plant in Rosarito, Baja California, to natural gas from oil. In
addition, the CFE has solicited offers from independent developers
to build 500 megawatts of new natural gas-fired electric generation
in Baja California.
Increased use of clean-burning
natural gas at power plants and industries in the region will improve
air quality by reducing emissions in the San Diego/Tijuana border
area. Currently, manufacturing plants and residents in Baja California
rely primarily on propane and fuel oil for industrial boilers and
Sempra Energy International
and Próxima Gas have been pioneers in Mexico's energy market. The
companies currently own and operate four energy businesses in Mexico,
including natural gas distribution systems in Mexicali, Baja California,
Chihuahua and the states of Coahuila and Durango, as well as the
pipeline from San Diego to the Rosarito Power Plant in Baja California.
The North Baja Pipeline
consortium will hold an open season beginning in mid-June to solicit
bids for capacity on the proposed pipeline. Prospective customers
should contact Henry Morse of the PG&E National Energy Group (503-833-4108),
or Ryan O'Neal of Sempra Energy International (619-696-4585) to
receive an open-season package.
PG&E Corporation, with revenues
of more than $20 billion and operations in 21 states, markets energy
services and products throughout North America through its National
Energy Group. One of the largest U.S. transporters of Canadian natural
gas, the Corporation owns and operates a 612-mile dual pipeline
system in the Pacific Northwest. PG&E Corporation's businesses also
include Pacific Gas and Electric Company, the Northern and Central
California utility that deliver natural gas and electricity to one
in every 20 Americans.
Próxima Gas S.A. de C.V.
is a private Mexican company that develops and invests in infrastructure
projects of great economic impact in Northern Mexico.
Sempra Energy International
develops, operates and owns energy projects. The company currently
is involved in joint or solo ventures that provide natural gas and
electricity services to more than 2.5 million customers in Argentina,
Canada, Chile, Mexico, Peru, the United States and Uruguay. Sempra
Energy International is a subsidiary of Sempra Energy, a Fortune
500 energy services holding company based in San Diego, Calif.,
with 12,000 employees, revenues of nearly $5.5 billion and more
than 9 million customers in the United States, Europe, Canada, Mexico
and South America.