Niagara Mohawk seeks sale of nuclear assets

["Sandy Perle" <sandyfl@earthlink.net>]

Thursday January 28, 11:44 am Eastern Time

Niagara Mohawk seeks sale of nuclear assets

NEW YORK, Jan 28 (Reuters) - Niagara Mohawk Power Corp. 
(NIMO) said Thursday it is in talks to sell its nuclear power assets 
in upstate New York.  

Those assets comprise full ownership in the 613 megawatt (MW) 
unit 1 at the Nine Mile Point nuclear facility in Scriba, New York, 
and the company's 41 percent stake in the adjacent, 1,140 MW 
Nine Mile Point unit 2, NIMO said in a statement.  

``The company...is in discussions concerning a sale but there can 
be no assurance that a transaction will occur. The company does 
not plan to make any further announcements on this matter until it 
signs a definitive agreement or determines not to pursue a sale,'' 
the statement said.  

NIMO declined to say which company or group of companies it is 
negotiating with or what the market value of the assets might be. 
Unit 1 started commercial operation in 1969, with unit 2 starting up 
in 1988.  

The company's Nine Mile Point assets carry a book value of $1.47 
billion, a company spokesman said.

The sale ultimately hinges on state and federal regulatory approval, 
a process NIMO estimated at 12 to 18 months from an agreement, 
and the buyer's willingness to take over the current contract 
between NIMO and the labor union representing the plant's 1,350 
employees, the company said.  

NIMO, prompted by the deregulation of New York State's electricity 
industry and growing competition among power providers, is in the 
process of shedding its generating assets to concentrate on 
delivering energy over its existing grid, becoming what the industry 
refers to as a ``wire company.''  

``The decision to pursue a sale of our nuclear assets is in line with 
our strategic direction of building shareholder value by focusing on 
our core energy delivery business,'' said William Davis, Niagara 
Mohawk's chairman and chief executive officer.  

NIMO operates both Nine Mile Point reactors, located about 35 
miles west of NIMO's Syracuse headquarters.

Co-owners of the Nine Mile Point 2 reactor are New York State 
Electric and Gas Corp. (18 percent), Long Island Power 
Authority/LILCO (18), Rochester Gas and Electric Corp. 
(NYSE:RGS - news) (14), and Central Hudson Gas and Electric 
Corp. (NYSE:CNH - news) (9).   

Niagara Mohawk currently provides electricity to some 1.5 million 
customers across 24,000 square miles of upstate New York and 
delivers natural gas to about 500,000 customers in   
eastern, central and northern New York.

Sandy Perle
E-Mail: sandyfl@earthlink.net 
Personal Website: http://www.geocities.com/capecanaveral/1205

"The object of opening the mind, as of opening 
the mouth, is to close it again on something solid"
              - G. K. Chesterton -
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