SAN FRANCISCO, CA - PG&E Corporation (NYSE:
PCG) today reported that, as expected, its PG&E
National Energy Group, Inc. (PG&E NEG) unit and
certain PG&E NEG subsidiaries have filed voluntary
petitions for reorganization under Chapter 11 of the
U.S. Bankruptcy Code in the U.S. Bankruptcy Court for
the District of Maryland, Greenbelt Division.
As previously disclosed, PG&E Corporation does
not expect that the outcome of PG&E NEG's bankruptcy
proceedings will have a material adverse effect on the
financial condition of PG&E Corporation, which has
no material obligations to PG&E NEG.
In May 2003, PG&E Corporation stated that the restructuring
of PG&E NEG would inevitably be implemented through
a Chapter 11 proceeding and that a bankruptcy filing
could take place as early as the second quarter of 2003.
Although PG&E Corporation worked hard and in good
faith for many months to structure an agreement that
would allow PG&E Corporation to retain ownership
of PG&E NEG for the benefit of the Corporation's
shareholders, those efforts were ultimately unable to
produce a consensus among creditors.
The Plan of Reorganization filed by PG&E NEG provides
that PG&E Corporation will have no equity interest
in PG&E NEG or any of its subsidiaries after its
Chapter 11 reorganization plan is implemented. The entities
filing for Chapter 11 reorganization today are:
- PG&E National Energy Group, Inc.;
- PG&E Energy Trading Holdings Corporation;
- PG&E Energy Trading – Gas Corporation;
- PG&E Energy Trading – Power Corporation;
- PG&E ET Investments Corporation; and
- USGen New England, Inc.
Other PG&E NEG subsidiaries, including PG&E
Gas Transmission Northwest and numerous independent
electric producers, are not filing for Chapter 11 reorganization.
It is expected that day-to-day operations at these affiliates
will be largely unaffected by today's Chapter 11 filings.
PG&E Corporation has no equity infusion agreements,
material contingent liabilities, or tax-sharing agreement
with PG&E NEG. The Corporation also does not expect
the outcome of PG&E NEG's bankruptcy to have any
effect on its utility subsidiary, Pacific Gas and Electric
Company, or the utility's reorganization plan and proposed
settlement agreement to end its Chapter 11 bankruptcy.
“Today's Chapter 11 filings are the next step forward
for PG&E NEG and its creditors, and they advance
the Corporation's goal of resolving uncertainties we
have been managing since the onset of the energy crisis,” said Robert D. Glynn, Jr., Chairman, CEO and President
of PG&E Corporation. “Moving forward, PG&E Corporation
will continue to focus on several critical objectives,
including implementing the proposed settlement agreement
to end the utility's Chapter 11 case, maximizing the
value of our utility operations, and strengthening our
A conference call with the financial community will
be held today at 11:30 a.m. Eastern time to discuss
PG&E NEG's Chapter 11 filing. The call will be open
to the public on a listen-only basis via webcast. Please
visit our website, www.pge-corp.com, for more information
and instructions for accessing the webcast. A replay
of the conference call will be available toll-free by
calling (877) 690-2089 and also will be available on
our website. International callers will be able to access
the replay by dialing (402) 220-0645.
This press release contains forward-looking
statements regarding the anticipated effect of the Chapter
11 proceedings of PG&E NEG and various of its affiliates
on PG&E Corporation. These statements are necessarily
subject to various risks and uncertainties. These statements
are based on current expectations and assumptions which
management believes are reasonable and on information
currently available to management. Actual results could
differ materially from those contemplated by the forward-looking
statements due to several factors including whether
and the extent to which the Bankruptcy Court having
jurisdiction over such Chapter 11 proceeding determines
that claims which may be asserted against PG&E Corporation
in such proceeding are meritorious.