SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
__X_ Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1996
OR
____ Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period from to
COMMISSION FILE NUMBER 0-10007
COLONIAL GAS COMPANY
(Exact name of registrant as specified in its charter)
Massachusetts 04-1558100
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
40 Market Street, Lowell, Massachusetts 01852
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (508) 322-3000
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $3.33 par value
(Title of Class)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes__X_ No____
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K
____
The aggregate market value of the voting stock held by non-
affiliates of the registrant as of February 28, 1997 was
$179,271,162.
The number of shares of the registrant's common stock outstanding
as of February 28, 1997 was 8,536,722.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the annual report to stockholders for the year ended
December 31, 1996 are incorporated by reference into Part II and
Part IV. Portions of the proxy statement for the 1997 annual
meeting of stockholders are incorporated by reference into Part
III.
COLONIAL GAS COMPANY
FORM 10-K ANNUAL REPORT - 1996
TABLE OF CONTENTS
PART I
Item 1. Business
Item 2. Properties
Item 3. Legal Proceedings
Item 4. Submission of Matters to a Vote of Security Holders
PART II
Item 5. Market for Registrant's Common Stock and Related
Stockholder Matters
Item 6. Selected Financial Data
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
PART III
Item 10. Directors and Executive Officers of the Registrant
Item 11. Executive Compensation
Item 12. Security Ownership of Certain Beneficial
Owners and Management
Item 13. Certain Relationships and Related Transactions
PART IV
Item 14. Exhibits,Financial Statement
Schedules, and Reports on Form 8-K
PART I
Item 1. Business
THE COMPANY
Colonial Gas Company ("Colonial" or the "Company"), a
Massachusetts corporation formed in 1849, is primarily a
regulated natural gas distribution utility. The Company serves
over 145,000 utility customers in 24 municipalities located
northwest of Boston and on Cape Cod. Through its subsidiary,
Transgas Inc. ("Transgas"), the Company also provides over-the-
road transportation of liquefied natural gas ("LNG"), propane and
other commodities.
The Company's corporate office is located at 40 Market
Street, Lowell, Massachusetts 01852. The telephone number is
(508) 322-3000.
The Company's combined natural gas distribution service
areas in the Merrimack Valley region northwest of Boston and on
Cape Cod cover approximately 622 square miles with a year-round
population of approximately 500,000, which increases by
approximately 350,000 during the summer tourist season on Cape
Cod. The Company is serving approximately 49% of potential
customers in its service areas. Of its 145,471 customers,
approximately 90% are residential accounts. The Company added
4,072 firm sales customers in 1996. The Company's growth has been
based on new residential construction in its service areas and
conversions to gas from other energy sources for existing homes
and businesses. Of the total number of new customers in 1996, 53%
converted from other fuels and 47% were new construction.
The Company's 1996 consolidated operating revenues were
derived 64% from firm gas sales to residential customers, 32%
from firm gas sales to commercial and industrial customers, 2%
from non-firm customers, 1% from firm transportation customers
and 1% from other revenues. For the year 1996, the Company sold
19,564 MMcf of gas, of which 11,808 MMcf was sold in the
Merrimack Valley area and 7,756 MMcf in the Cape Cod area. At
December 31, 1996, 90% of the Company's residential customers
used gas as their source of heating fuel. The demand for the
products and services furnished by the Company is to a great
extent seasonal, being heaviest in the colder months.
At December 31, 1996, the Company had 475 full-time-
equivalent employees. Of those employees, 90 are covered by a
collective bargaining agreement with the United Steelworkers of
America which expires in April 2001 and 75 are covered by a
separate collective bargaining agreement with the United
Steelworkers of America which expires in February 2000. In
addition, Transgas employs 78 full-time employees of which 61 are
covered by collective bargaining agreements with the
International Brotherhood of Teamsters . The drivers agreement
expires in June 1999 while the mechanics agreement expires in
July 1999.
GAS SUPPLY, TRANSPORTATION AND STORAGE RESOURCES
Since 1993, the effective date of Order 636 of the Federal
Energy Regulatory Commission ("FERC"), the Company has been
responsible for managing its own supply, pipeline transportation
capacity and storage resources on behalf of its firm sales
customers. Generally, the Company pays negotiated prices for
pipeline-transported supplies and tariffed rates (approved by
FERC) for pipeline transportation and storage services it
purchases to meet the requirements of its firm sales customers.
As discussed below under "State Regulation", the Company
continues to explore ways of further unbundling its services to
provide a greater number of its customers the opportunity to
purchase gas, which would still be distributed by the Company,
from alternative suppliers. The further unbundling of services
would likely entail adjustments in the Company's gas portfolio,
although those adjustments cannot be precisely determined at this
time.
The Company continues to meet its customers' firm supply
requirements through a combination of firm and spot purchases of
pipeline-transported supply, supply from underground storage,
liquefied natural gas and propane. The following table shows the
Company's sources of firm supply available to meet its gas
requirements and the actual components of gas sendout for each of
the last three years:
1996 1995 1994
MMcf(a) % MMcf(a) % MMcf(a) %
Firm Pipeline
Transportation
Capacity 30,313 30,630 28,993
Firm Gas Supply Sources
Contracts for Pipeline-
Transported Gas(b) 18,698 71 18,725 70 19,631 72
LNG contracts 4,150 15 4,150 15 4,050 15
Storage inventory at
January 1 (c) 3,614 14 3,956 15 3,587 13
Total Available 26,462 100 26,831 100 27,268 100
Gas Sendout
Pipeline-Transported
Supplies (d) 15,115 72 14,659 72 14,392 72
Supplemental Supplies:
Underground
storage 3,346 16 3,270 16 3,112 16
LNG-as liquid 1,067 5 844 4 1,129 6
LNG-as vapor 1,528 7 1,574 8 1,236 6
Propane-air 1 0 8 _ 25 -
Total Sendout 21,057 100 20,355 100 19,894 100
Ratio of available
firm supply to
sendout (e) 1.26 1.32 1.37
_________________________
(a) The term "MMcf" means one million cubic feet of vapor
or vapor equivalent.
(b) The Company's firm supply purchase contracts are
structured to enable the Company to purchase volumes
equivalent to the total amount of its firm pipeline
transportation capacity during the winter or peak demand
season, but less than total firm pipeline capacity during
the off-peak season. Accordingly, the total supply purchase
contract volumes shown are less than total firm
transportation capacity for 1996, 1995 and 1994.
(c) The Company's storage inventory is drawn down and
refilled throughout the year depending upon the availability
and price of gas sources and upon the requirements of the
Company's customers. The Company's current level of
underground storage capacity is 4,674 MMcf.
(d) Includes firm and spot volumes.
(e) The Company's ratio of available firm supply to sendout
was determined by dividing total firm gas supply sources by
total sendout.
Based upon its firm contracts for transportation, storage,
supply and other supplemental sources, the Company expects to be
able to meet the gas requirements of its firm sales customers for
the foreseeable future. Additional information concerning the
Company's firm resources of gas transportation, storage and
supply for each of its two service territories is set forth
below.
Merrimack Valley Service Area Resources
The Company maintains three firm contracts with the
Tennessee Gas Pipeline Company ("Tennessee") for the
transportation of supply to the Merrimack Valley service area.
The first contract provides for the firm transportation of 25,196
Mcf per day and is in effect until November 1, 2000. The second
firm transportation contract is for 17,300 Mcf per day and is in
effect until April 1, 2013. During the off-peak season (April 1
through October 31), the Company assigns this 17,300 Mcf per day
of transportation capacity and associated supply to an
independently owned, 84 MW cogeneration facility located in the
Company's service territory. The third firm transportation
service contract with Tennessee is utilized in conjunction with
the Iroquois Pipeline System ("Iroquois") to deliver 6,000 Mcf
per day of Canadian supplies to the Company. Of this amount,
4,000 Mcf per day can also be transported to the Cape Cod service
area on a firm basis via the Algonquin Gas Transmission Company
("Algonquin") system. This third Tennessee contract, as well as
the related Iroquois contract, is in effect until November 1,
2011.
In addition, the Company contracts for underground storage
service which, in conjunction with two Tennessee firm
transportation contracts, provide up to an additional 23,587 Mcf
per day of firm deliverability. The Company has storage capacity
of 2,028,800 Mcf and firm deliverability of 16,083 Mcf per day
under two contracts with the National Fuel Gas Supply
Corporation, ("National Fuel"). In order to deliver these
volumes, the Company has a firm transportation contract with
Tennessee for 16,083 Mcf per day. Both the National Fuel and
Tennessee contracts expire on March 31, 2000 and continue from
year to year thereafter unless terminated upon twelve months
prior written notice. The Company also has a contract with
Tennessee for an additional 1,095,830 Mcf of storage space and
14,150 Mcf per day of withdrawal capacity. In order to deliver
these volumes, the Company has a separate firm transportation
contract with Tennessee for 7,504 Mcf per day. Both of these
contracts continue until November 1, 2000.
The Company's portfolio of firm pipeline-transported supply
for the Merrimack Valley area consists principally of four
purchase contracts for domestically-produced gas and one purchase
contract for Canadian-produced gas. These individually negotiated
contracts provide an aggregate of up to 48,496 Mcf per day of
firm supply during the peak season (November 1 through March 31).
The Company has received the requisite approval of the
Massachusetts Department of Public Utilities ("DPU") for these
supply contracts.
During the peak season, pipeline-transported supply and
storage volumes are supplemented by on-system LNG and propane
facilities. On January 13, 1997, the Company entered into
definitive joint venture agreements with Cabot LNG Corporation
("Cabot LNG"). The joint venture agreements provide that,
subject to certain regulatory approvals, (1) the Company will
sell a 50% interest in Transgas to Cabot LNG (See the "Transgas
Inc." Section hereafter), and (2) the Company will lease its LNG
facility in Tewksbury, Massachusetts to a joint venture entity
owned 50/50 by the Company and Cabot LNG. Pursuant to this joint
venture, Cabot LNG's marketing subsidiary, Distrigas of
Massachusetts Corporation ("DOMAC") will market and sell
vaporized LNG from the Tewksbury LNG facility above the Company's
requirements, with the joint venture entity sharing in the net
revenues from such sales. For the 1997-98 heating season, the
Company would be entitled to receive up to 46,100 Mcf per day of
vaporized LNG through the Tewksbury LNG facility. The sendout
capability of the Company's remaining on-system LNG and propane
facilities is approximately 30,000 Mcf per day.
Cape Cod Service Area Resources
The Cape Cod service area is directly served by the
Algonquin pipeline system. The Company maintains fourteen firm
transportation agreements with Algonquin which provide an
aggregate capacity of approximately 45,368 Mcf per day. Each of
these fourteen Algonquin transportation arrangements are in
effect until October 31, of either 2012 or 2013. Since the
Company's firm supplies and storage services are not directly
connected to Algonquin, these services are supported by multiple
firm transportation and storage services on seven other upstream
pipelines.
The Company also has five storage contracts to service the
Cape Cod area, two of which are on the Texas Eastern Transmission
Company ("Texas Eastern") system and three of which are on the
CNG Transmission Corporation ("CNG") system. The storage
contracts with Texas Eastern total approximately 493,486 Mcf of
capacity and run through the 2012-2013 heating season. The
associated firm transportation capacity from Texas Eastern
storage provides deliverability of up to 6,969 Mcf per day. The
storage contracts with CNG are for approximately 823,529 Mcf of
capacity through March 31, 2006 and 232,600 Mcf of capacity
through March 31, 2012. The associated firm transportation
capacity from CNG storage provides deliverability of up to 6,342
Mcf per day and Colonial has other arrangements in place by which
it may increase that firm deliverability by 6,999 Mcf per day.
The Company's portfolio of pipeline-transported supplies for
the Cape Cod area consists principally of four purchase contracts
for domestically-produced gas. These individually negotiated
contracts, all of which have been approved by the DPU, provide an
aggregate of up to 20,918 Mcf per day of firm supply during the
peak season (November 1 through March 31). The Company also has
the ability to deliver up to 4,000 Mcf per day of Canadian
supplies to the Cape Cod service area on a firm basis utilizing
the transportation contracted for the Merrimack Valley service
area.
The Company also operates facilities and maintains contracts
which provide up to approximately 32,500 Mcf per day of LNG vapor
to the Cape Cod Division during the peak season.
REGULATORY MATTERS
The Company is a public utility subject to the jurisdiction
and regulatory authority of the DPU with respect to its rates as
well as to the issuance of securities, franchise territory and
other related matters. Under the present regulatory system, the
DPU permits Massachusetts gas companies to utilize a cost of gas
adjustment clause ("CGAC") through which firm sales customers
pay, via their monthly gas bill, the exact costs incurred by the
companies in procuring and transporting gas to the companies'
distribution systems, as such costs change from time to time.
Changes in non-gas or base rates charged to customers are subject
to approval by the DPU after formal proceedings.
Environmental response costs, transition costs and demand
side management (DSM) program costs are recovered through the
CGAC, as approved by the DPU. The environmental response costs
recovered through the CGAC relate to the Company's former gas
manufacturing operations, as described under "Environmental
Matters". Transition costs relate to FERC approved pipeline
charges resulting from Order 636. In addition to full recovery
of installed conservation measures, the Company is allowed to
recover, under methodologies approved in 1995 for its
residential DSM programs and in 1996 for its commercial and
industrial programs, resulting lost margins and financial
incentives based on the attainment of performance goals. In
1996, the Company recorded as operating revenues $1,034,000 of
lost margins and $142,000 of financial incentives associated
with the residential and commercial DSM programs and in 1995,
recorded as operating revenues $900,000 of lost margins and
$220,000 of financial incentives.
The Company has made only two requests for base rate
increases since 1984. Its most recent request was made in 1993.
In response to that request, the DPU approved a base rate
increase designed to produce additional revenues of $6.7 million
or 4.9% annually, effective November 1, 1993.
The Company's goal is to postpone the filing of a request for its
next base rate increase until at least the year 2000 through
cost-cutting and other measures, such as its joint venture with
Cabot LNG, while maintaining an adequate return to shareholders.
Under a 1995 industry-wide ruling of the DPU, the Company will be
required in its next base rate filing either to present an
alternative incentive-based method of pricing or to justify
continuation of the traditional cost-of-service/rate-of-return
method. The Company has reviewed alternative incentive-based
pricing methods but has not yet determined what method of regulation
will be of greater benefit to its customers and shareholders.
During 1996, the DPU ordered all Massachusetts gas companies
to offer only "unbundled" gas service to interruptible and
special contract customers, as a means of promoting greater
competition at the city-gate. Unbundled service separates (i)
the part of the service involving procuring the gas and
transporting it to the city-gate (i.e. the point where the
Company takes gas from the interstate pipeline into its
distribution system); and (ii) the delivery of the gas to the
customer's facility through the local distribution system. The
Company had previously offered both bundled and unbundled service
to interruptible and special contract customers.
Since 1993, the Company also has been offering unbundled
service as an alternative to its firm commercial and industrial
customers. As of December 31, 1996, 19 customers had opted for
this firm transportation service, representing less than 2% of
the Company's annual firm load. The Company is analyzing
methods for making unbundled service viable for a greater number
of firm customers, and anticipates DPU rulings containing
additional unbundling guidelines in 1997.
In its 1996 order, the DPU continued to allow Massachusetts
gas companies to price interruptible services at negotiated rates
based on the value of that service to the customer.
Additionally, Massachusetts gas companies will now be permitted
to retain 25% of the net margins earned on interruptible sales,
interruptible transportation and capacity release transactions,
to the extent those margins exceed thresholds based on previous
activity. The Company had previously been allowed to retain 10%
of capacity release revenues above an initial threshold of
$2,5000,000 under its 1993 base rate proceeding. The amounts
retained by the Company from interruptible sales, interruptible
transportation and capacity release transactions in 1996, 1995
and 1994 totaled $0, $81,000 and $32,000, respectively. All
other revenues from these transactions flow back to firm sales
customers through the CGAC.
The Company follows the provisions of Statement of Financial
Accounting Standards (SFAS) No. 71, "Accounting for the Effects
of Certain Types of Regulation," requiring the Company to record
the financial statement effects of the rate regulation to which
the Company is currently subject. Future regulatory changes
could result in the Company no longer meeting the provisions of
SFAS No.71 for all or part of its business; thereby requiring the
elimination of the financial statement effects of regulation for
that portion of its business.
COMPETITION
Massachusetts law protects gas companies from competition
with respect to pipeline distribution of gas within its franchise
areas by providing that, where a gas company exists in active
operation, no other person may lay pipe in the public ways
without the approval, after notice and hearing, of the municipal
authorities and the DPU. If a municipality desires to enter the
gas business, it must take certain procedural steps, including a
favorable vote by a majority of the voters in a city election or
two-thirds vote at each of two town meetings. In addition, the
municipality must purchase the property of any gas company
operating in the municipality (if the company elects to sell) to
the extent, and at such prices, as may be agreed upon; if no
agreement is reached, resolution will be determined by the DPU.
As discussed above under "Regulatory Matters", the
opportunity already exists for commercial and industrial
customers in the Company's franchise areas to purchase gas supply
and pipeline transportation from entities other than the Company,
and then contract with Colonial for transportation-only service
through the Company's distribution system. The Company provides
such transportation-only service to commercial and industrial
customers on either a firm basis or an interruptible basis. As
also discussed above, the Company is evaluating ways to make
transportation-only service accessible to a greater number of
customers. While firm transportation service may displace firm
gas sales by the Company, this service assists qualifying
customers in obtaining the lowest possible gas costs while still
contributing to the profit margin of the Company. In general,
profit margins from interruptible sales and interruptible
transportation pass through to firm sales customers in the CGAC,
resulting in lower gas costs. As also discussed above in
"Regulatory Matters", the Company may now retain 25% of such
profit margins above an annual threshold level adjusted on April
30th of each year.
In addition although FERC has generally permitted larger
industrial users to obtain piped gas from other sources and by-
pass a utility's distribution system, the Company has not seen
nor does it believe that these FERC orders will have a material
adverse effect on its business, in part because large industrial
users are not a significant part of its customer base.
Fuel oil suppliers, electric utilities and propane suppliers
provide competition generally for residential, commercial and
industrial customers. Interruptible sales are generally in
competition with No. 6 fuel oil which most of the interruptible
customers are equipped to use. Lower prices of oil and other
fuels may adversely affect the Company's ability to retain or
attract customers. The Company's rates for bundled gas service
have remained generally competitive with the price of alternative
fuels, but the long-term impact of changes in fuel prices and
changes in state regulatory policies on the Company and its rates
cannot be predicted.
ENVIRONMENTAL MATTERS
The Company is subject to Federal and state laws and
regulations dealing with environmental protection. Compliance
with such environmental laws and regulations has resulted in
increased costs with respect to the Company's existing
operations.
Working with the Massachusetts Department of Environmental
Protection, the Company is engaged in site assessments and
evaluation of remedial options for contamination that has been
attributed to the Company's former gas manufacturing site and at
various related disposal sites. During 1990, the DPU ruled that
Colonial and eight other Massachusetts gas distribution
companies can recover environmental response costs related to
former gas manufacturing operations over a seven-year period,
without carrying costs, through the CGAC. Through December 31,
1996, the Company had incurred environmental response costs of
$11,156,000 of which $7,148,000 has been recovered from
customers to date. The Company expects to continue incurring
costs arising from these environmental matters.
As of December 31, 1996, the Company has recorded on the
balance sheet a long-term liability of $1,183,000 and, based
upon rate recovery, has recorded a corresponding regulatory
asset. This amount represents estimated future response costs
for these sites based on the Company's preferred methods of
remediation. Actual environmental response costs to be incurred
depends on various factors, and therefore future costs may
differ from the amount currently recorded as a liability.
TRANSGAS INC.
Transgas primarily provides over-the-road transportation of
liquefied natural gas, propane and other commodities. In 1996,
Transgas provided such service to approximately 60 commercial and
gas utility customers located in the eastern half of the United
States. Transgas also provides a highly specialized LNG portable
pipeline service, which permits gas utilities to provide a
continuous supply of natural gas to communities when pipeline gas
is interrupted for scheduled or emergency shutdowns or when
supplemental supplies are required during periods of peak winter
demand. Transgas is subject to various federal and state
regulations applicable to motor carriers of hazardous materials.
During 1996, Transgas discontinued its propane trucking
operations for non-utility customers.
Transgas had revenues of $11,031,000 in 1996. Approximately
73% of Transgas' revenue in 1996 was derived from transporting
LNG from DOMAC's import terminal, located in Everett,
Massachusetts. Transgas' revenues increased $3,455,000 or 45%
compared to 1995 due primarily to the colder than normal weather
in the fourth quarter of 1995 and the first quarter of 1996 which
generated a significant increase in demand for the truck
transportation of LNG throughout the year.
Transgas provides over-the-road transportation services by
utilizing a fleet of 54 tractors. Transgas operates over 60
trailers which are specifically designed for the transportation
of LNG and other cryogenic liquids. Of those cryogenic transport
trailers, 20 are leased to Transgas . In addition, Transgas has
11 trailers which are designed for the transportation of propane.
Of those propane transport trailers, 6 are leased to Transgas. In
addition to the equipment described above, Transgas also has 15
trailers which are equipped as portable LNG vaporizers, as well
as 2 flat bed trailers and 2 van trailers.
Transgas competes with other motor carriers engaged in the
transportation of various gases and other products. Transgas
believes, however, that it is the leading over-the-road
transporter of LNG due to the size of its specialized LNG trailer
fleet and the number of LNG loads it delivers annually.
Transgas is presently wholly-owned by the Company. As
referenced above in "Gas Supply, Transportation and Storage
Resources", the Company has agreed to sell a 50% interest in
Transgas to Cabot LNG as part of a joint venture. The purchase
price for the 50% interest is $7,000,000. The Company's sale of
a 50% interest in Transgas and its lease of the Tewksbury LNG
facility to a joint venture entity are designed to combine the
Company's LNG trucking and storage capabilities with the
marketing and storage capabilities of Cabot LNG. Completion of
the sale of the Transgas interest and implementation of the joint
venture are subject to certain regulatory approvals. The Company
will recognize a one-time gain of approximately $.35 per share at
the time of the sale, expected to occur in the first half of
1997. Effective upon such sale, the Company will be recognizing
50% of the net income of Transgas on an equity basis.
Item 1A. Executive Officers of the Registrant.
The following table indicates the present executive officers
of the Company, their ages, the dates when their service with the
Company began and their respective positions with the Company.
Affiliated with
Name and Age Position with Company Company Since
Frederic L. Putnam, Jr. (72) Chairman and Senior 1953
Executive Officer
Frederic L. Putnam, III (51) President and Chief 1975
Executive Officer
Charles W. Sawyer (51) Executive Vice
President and Chief
Operating Officer 1976
Nickolas Stavropoulos (39) Executive Vice President 1979
- Finance, Marketing, and
Chief Financial Officer
John P. Harrington (54) Senior Vice President 1966
- Gas Supply and Assistant
to the President
Victor W. Baur (53) President - Transgas Inc. 1972
Dennis W. Carroll (50) Vice President and Treasurer 1990
Charles A. Cook (44) Vice President and 1978
General Counsel
Mr. Putnam, Jr. has been Chairman of the Board of Directors
since 1981 and the Senior Executive Officer since February 1995
and before that the Chief Executive Officer since 1977. He has
also been a Director since 1973.
Mr. Putnam, III, the son of F.L. Putnam, Jr., has been
President and Chief Executive Officer since February 1995. He had
been President since May 1994. He had been Executive Vice
President and General Manager from April 1993 until May 1994 and
before that Vice President and General Manager from August 1989
until April 1993. He has also been a Director since November
1991.
Mr. Sawyer has been Executive Vice President and Chief
Operating Officer since February 1995. He had been Vice President
- - Operations since August 1989.
Mr. Stavropoulos has been Executive Vice President -
Finance, Marketing and Chief Financial Officer since February
1995. He had been Vice President - Finance and Chief Financial
Officer since August 1989. He has also been a Director since
February 1993.
Mr. Harrington has been Senior Vice President - Gas Supply
and Assistant to the President since February 1995. He had been
Vice President - Gas Supply since August 1989. He has also been a
Director since February 1993.
Mr. Baur has been President of Transgas Inc. since July
1990. He also became a Director in August 1993.
Mr. Carroll has been Vice President and Treasurer since
August 1990.
Mr. Cook has been Vice President and General Counsel since
July 1990. Mr. Cook has announced his intention to leave the
Company for private practice, effective May 1, 1997.
These officers hold office until the next annual meeting of
the Board of Directors or until their successors are duly elected
and qualified, subject to earlier removal.
Item 2. Properties.
The Company has two principal operations centers and a
natural gas storage facility with approximately 1,000,000 Mcf of
LNG storage capacity located in Tewksbury, Massachusetts. As
part of the joint venture with Cabot LNG described above in "Gas
Supply, Transportation and Storage Resources", the Company has
agreed to lease the Tewksbury LNG facility to an entity owned
50/50 by the Company and Cabot LNG. The Company will continue to
own the Tewksbury LNG facility and, under one of the joint
venture agreements, will initially be its operator. In general,
the Company's gas production and storage facilities, metering and
regulation stations and operations centers, including the
Tewksbury LNG facility, are located on land it owns.
A 175,000 Mcf LNG storage tank located on land owned by the
Company in South Yarmouth, Massachusetts is leased from an
unaffiliated company through 1998. The Company also has a lease
which expires in 2002 for office facilities in Lowell,
Massachusetts.
The Company's distribution mains of approximately 2,960
miles are located within public highways under franchises or
permits from state or municipal authorities, or on land owned by
others under easements or licenses from the owners. The Company's
first mortgage bonds are collateralized by utility property.
Management considers that the Company's properties are
adequate for the conduct of its business for the reasonably
foreseeable future.
Item 3. Legal Proceedings.
See Item 1, "Business--Environmental Matters" above, which
is incorporated herein.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of the Company's security
holders during the quarter ended December 31, 1996.
PART II
Item 5. Market for Registrant's Common Stock and Related
Stockholder Matters.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's 1996 annual report to stockholders under the caption
"Shareholder Information" and under Note D of the "Notes to
Consolidated Financial Statements".
Item 6. Selected Financial Data.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's 1996 annual report to stockholders under the caption
"Selected Financial Data".
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's 1996 annual report to stockholders under the caption
"Management's Discussion and Analysis of Financial Condition and
Results of Operations".
Item 8. Financial Statements and Supplementary Data.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's 1996 annual report to stockholders under the following
captions: "Consolidated Statements of Income", "Consolidated
Balance Sheets", "Consolidated Statements of Cash Flows",
"Consolidated Statements of Common Equity", "Notes to
Consolidated Financial Statements", "Report of Independent
Certified Public Accountants" and "Shareholder Information".
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information required to be reported hereunder pursuant
to Item 401 of Regulation S-K for the Company's Directors is
incorporated by reference to the information reported in the
Company's Proxy Statement for its 1997 annual meeting of
stockholders under the caption "Election of Directors".
The information required to be reported hereunder pursuant
to Item 401 of Regulation S-K for the Executive Officers of the
Registrant is incorporated by reference to the information in
Item 1A of this Form 10-K under the caption "Executive Officers
of the Registrant".
The information required to be reported hereunder pursuant
to Item 405 of Regulation S-K is incorporated by reference to the
information reported in the Company's Proxy Statement for its
1997 annual meeting of stockholders under the caption "Section
16(a) Beneficial Ownership Reporting Compliance".
Item 11. Executive Compensation.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's Proxy Statement for its 1997 annual meeting of
stockholders under the captions "Executive Compensation" and
under the subheading "Directors' Compensation" of the caption
"Election of Directors".
Item 12. Security Ownership of Certain Beneficial Owners and
Management.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's Proxy Statement for its 1997 annual meeting of
stockholders under the caption "Security Ownership of Certain
Beneficial Owners and Management".
Item 13. Certain Relationships and Related Transactions.
The information required to be reported hereunder is
incorporated by reference to the information reported in the
Company's Proxy Statement for its 1997 annual meeting of
stockholders under the caption "Election of Directors".
PART IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K.
(a) 1. Financial Statements The Consolidated Financial
Statements of the Company (including the Report of
Independent Certified Public Accountants) required to be
reported herein are incorporated by reference to the
information reported in the Company's 1996 annual report
to stockholders under the following captions:
"Consolidated Statements of Income", "Consolidated
Balance Sheets", "Consolidated Statements of Cash Flows",
"Consolidated Statements of Common Equity", "Notes to
Consolidated Financial Statements" and "Report of
Independent Certified Public Accountants".
2. Financial Statement Schedules The following
Financial Statement Schedules and report thereon are
filed as part of this Form 10-K on the pages indicated
below:
Schedule Page
Number Description Number
Report of Independent Certified
Public Accountants on Schedule
II Valuation and Qualifying Accounts
for the three years ended
December 31, 1996
Schedules other than those listed above are either not required
or not applicable, or the required information is shown in the
financial statements or notes thereto. Columns omitted from
schedules filed have been omitted because the information is not
applicable.
3. List of Exhibits
Exhibit
Number Exhibit Reference
3a Restated Articles of Organization of Incorporated herein
Colonial Gas Company, dated April
19, 1989, as amended on July 16,
1992 and supplemented by a certificate
of vote of Directors establishing a
series of a class of stock filed on
November 30, 1993, filed as Exhibit
3(a) to the Registrant's Annual Report
on Form 10-K for the fiscal year ended
December 31, 1993.
3b By-Laws of Colonial Gas Company, as Incorporated herein
amended to date, filed as Exhibit by reference.
3(b) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended December 31, 1993.
4a Second Amended and Restated First Incorporated herein
Mortgage Indenture, dated as of June by reference.
1, 1992, filed as Exhibit 4(b) to
Form 10-Q of the Registrant for the
quarter ended June 30, 1992.
4b First Supplemental Indenture, dated Incorporated herein
as of June 15, 1992, filed as by reference.
Exhibit 4(c) to Form 10-Q of the
Registrant for the quarter ended
June 30, 1992.
4c Second Supplemental Indenture, Incorporated herein
executed on September 27, 1995, by reference.
relating to the Secured Medium Term
Notes, Series A, filed as Exhibit
4(c) to the Registrant's Form 10-K
for the fiscal year ended December
31, 1995.
4d Amendment to Second Supplemental Incorporated herein
Indenture, dated as of October 12, by reference.
1995, relating to the Secured Medium
Term Notes, Series A, filed as
Exhibit 4(d) to the Registrant's
Form 10-K for the fiscal year ended
December 31, 1995.
4e Credit Agreement for Colonial Gas Incorporated herein
Company, dated as of June 27, 1990, by reference.
filed as Exhibit 10(a) to Form 8-K
of the Registrant for the quarter
ended June 30, 1990, as amended on
December 24, 1991, filed as Exhibit
4(j) to Form 10-K of the Registrant
for the year ended December 31,
1991, as amended on July 27, 1993,
filed as Exhibit 4(a) to Form 10-Q
of the Registrant for the quarter
ended June 30, 1993, as amended on
June 16, 1994 filed as Exhibit 4(a)
to Form 10-Q of the Registrant for
the quarter ended June 30, 1994, as
amended on July 13, 1994 filed as
Exhibit (4b) to Form 10-Q of the
Registrant for the quarter ended
June 30, 1994.
4f Credit Agreement for Massachusetts Incorporated herein
Fuel Inventory Trust, dated as of by reference.
June 27, 1990, filed as Exhibit
10(b) to Form 8-K of the Registrant
for the quarter ended June 30, 1990,
as amended on July 27, 1993, filed
as Exhibit 4(b) to Form 10-Q of the
Registrant for the quarter ended
June 30, 1993, as amended on June
16, 1994 filed as Exhibit 4(c) to
Form 10-Q of the Registrant for the
quarter ended June 30, 1994, as
amended on July 13, 1994 filed as
Exhibit 4(d) to Form 10-Q of the
Registrant for the quarter ended
June 30, 1994.
4g Purchase Contract, dated as of June Incorporated herein
27, 1990 between Massachusetts Fuel by reference.
Inventory Trust acting by and
through its Trustee, Shawmut Bank,
N.A. and Colonial Gas Company, filed
as Exhibit 10(e) to Form 8-K of the
Registrant for quarter ended June
30, 1990.
4h Security Agreement and Assignment of Incorporated herein
Contracts, dated as of June 27, 1990 by reference.
made by Massachusetts Fuel Inventory
Trust in favor of The First National
Bank of Boston as Agent, for the
Ratable Benefit of the Secured
Parties Named Herein, filed as
Exhibit 10(c) to Form 8-K of the
Registrant for the quarter ended
June 30, 1990.
4i Trust Agreement, dated as of June Incorporated herein
22, 1990 between Colonial Gas by reference.
Company (as Trustor) and Shawmut
Bank, N.A. (as Trustee), filed as
Exhibit 10(d) to Form 8-K of the
Registrant for quarter ended June
30, 1990.
10a Service Agreement with Algonquin Gas Incorporated herein
Transmission Company, dated December by reference.
11, 1972, filed as Exhibit 13(n) to
Colonial Gas Energy System's
Registration Statement on Form S-1.
Commission File No. 2-54673.
10b Storage Service Agreement with Penn- Incorporated herein
York Energy Corporation, dated as of by reference.
December 21, 1984, filed as Exhibit
10(r) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended December 31, 1984.
10c Gas Transportation Contract for Firm Incorporated herein
Reserved Service with Iroquois, by reference.
dated February 7, 1991, filed as
Exhibit 10(v) to the Registrant's
Annual Report on Form 10-K for the
fiscal year ended December 31, 1990.
10d Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-E), dated June 1, 1993,
filed as Exhibit 10(p) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10e Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated June 1, 1993,
filed as Exhibit 10(q) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10f Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated June 1, 1993,
filed as Exhibit 10(r) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10g Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated June 1, 1993,
filed as Exhibit 10(s) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10h Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-E), dated June 1, 1993,
filed as Exhibit 10(t) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10i Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated June 1, 1993,
filed as Exhibit 10(u) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10j Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated June 1, 1993,
filed as Exhibit 10(v) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10k Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule CDS), dated June 1, 1993,
filed as Exhibit 10(w) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10l Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FT-1), dated June 1, 1993,
filed as Exhibit 10(x) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10m Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FTS-8), dated June 1, 1993,
filed as Exhibit 10(y) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10n Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FTS-7), dated June 1, 1993,
filed as Exhibit 10(z) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10o Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FT-1), dated June 1, 1993,
filed as Exhibit 10(aa) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10p Service Agreement between Incorporated herein
Transcontinental Gas Pipe Line by reference.
Corporation and Colonial Gas Company
(under Rate Schedule FT), dated June
1, 1993, filed as Exhibit 10(ee) to
the Registrant's Annual Report on
Form 10-K for the fiscal year ended
December 31, 1993.
10q Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FT-1), dated June 1, 1993.
10r Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated August 1,
1993, filed as Exhibit 10(ll) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10s Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated September 1,
1993, filed as Exhibit 10(nn) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10t Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated September 1,
1993, filed as Exhibit 10(oo) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10u Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated September 1,
1993, filed as Exhibit 10(pp) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10v Service Agreement between CNG Incorporated herein
Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FTNN), dated October 1,
1993, filed as Exhibit 10(rr) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10w Service Agreement between CNG Incorporated herein
Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule GSS), dated October 1,
1993, filed as Exhibit 10(ss) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10x Service Agreements between CNG Incorporated herein
Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule GSS-II), dated September
30, 1993, filed as Exhibit 10(tt) to
the Registrant's Annual Report on
Form 10-K for the fiscal year ended
December 31, 1993.
10y Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FT-1), dated October 1,
1993, filed as Exhibit 10(uu) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10z Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated September 1,
1993, filed as Exhibit 10(vv) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10aa Service Agreement between National Incorporated herein
Fuel Gas Supply Corporation and by reference.
Colonial Gas Company (under Rate
Schedule EFT), dated October 28,
1993, filed as Exhibit 10(ww) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10bb Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated September 1,
1993, filed as Exhibit 10(xx) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10cc Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AIT-1), dated September 15,
1993, filed as Exhibit 10(yy) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10dd Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated October 1,
1993, filed as Exhibit 10(zz) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1993.
10ee Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FT-1), dated August 18,
1994, filed as Exhibit 10(kk) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10ff Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FSS-1), dated August 29,
1994, filed as Exhibit 10(ll) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10gg Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule CDS), dated August 29,
1994, filed as Exhibit 10(mm) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10hh Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule CDS), dated August 29,
1994, filed as Exhibit 10(nn) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10ii Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule SS-1), dated November 30,
1994, filed as Exhibit 10(oo) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10jj Service Agreement between Texas Incorporated herein
Eastern Transmission Corporation and by reference.
Colonial Gas Company (under Rate
Schedule FSS-1), dated November 30,
1994, filed as Exhibit 10(pp) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10kk Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated November 1,
1994, filed as Exhibit 10(ss) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10ll Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated November 1,
1994, filed as Exhibit 10(tt) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
10mm Firm Natural Gas Transportation Incorporated herein
Agreement between Tennessee Gas by reference.
Pipeline Company and Colonial Gas
Company (under Rate Schedule NET-
Northeast), dated August 1, 1995,
filed as Exhibit 10(qq) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1995.
10nn Gas Transportation Agreement between Incorporated herein
Tennessee Gas Pipeline Company and by reference.
Colonial Gas Company (under Rate
Schedule FT-A), dated June 1, 1995,
filed as Exhibit 10(rr) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1995.
10oo Amendment No. 1 (dated July 1, 1995) Incorporated herein
to Gas Storage Contract between by reference.
Tennessee Gas Pipeline Company and
Colonial Gas Company (under Rate
Schedule FS), dated December 1, 1994
(which superseded contract dated
September 1, 1993), filed as Exhibit
10(ss) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended December 31, 1995.
10pp Amendment to Gas Transportation Incorporated herein
Contract for Firm Reserved Service by reference.
with Iroquois Gas Transmission
System, L.P., dated September 1,
1995, filed as Exhibit 10(tt) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1995.
10qq Service Agreement between Algonquin Incorporated herein
Gas Transmission Company and by reference.
Colonial Gas Company (under Rate
Schedule AFT-1), dated December 1,
1995, filed as Exhibit 10(uu) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1995.
10rr Amendment to Storage Service Filed herewith as
agreement with Penn-York Energy Exhibit 10rr.
Corporation (referenced as Exhibit
10b above) dated May 1, 1996 between
Colonial Gas Company and National
Fuel Gas Supply Corporation
(successor -in-interest to Penn-York
Energy Corporation)
10ss Service Agreement between National Filed herewith as
Fuel Gas Supply Corporation and Exhibit 10ss.
Colonial Gas Company (FST Service)
dated April 12, 1996 and amended May
1, 1996 and December 1, 1996.
10tt Service Agreement between National Filed herewith as
Fuel Gas Supply Corporation and Exhibit 10tt.
Colonial Gas Company (FSS Service)
dated April 12, 1996 and amended May
1, 1996 and December 1, 1996.
10uu Firm Gas Transportation Agreement Filed herewith as
between Koch Gateway Pipeline Co. Exhibit 10uu.
and Colonial Gas Company (FTS
Service) dated November 1, 1996.
10vv Service Agreement between Algonquin Filed herewith as
Gas Transmission Company and Exhibit 10vv.
Colonial Gas Company (under Rate
Schedule AFT-E) dated November 2,
1996.
10ww Service Agreement between Algonquin Filed herewith as
Gas Transmission Company and Exhibit 10ww.
Colonial Gas Company (under Rate
Schedule AFT-E) dated November 17,
1996.
10xx Lease Agreement, dated as of May 1, Incorporated herein
1982, with Olde Market House by reference.
Associates of Lowell, filed as
Exhibit 10(y) to the Registrant's
Annual Report on Form 10-K for the
fiscal year ended December 31, 1982.
10yy Lease of Equipment from The National Incorporated herein
Shawmut Bank of Boston (now Shawmut, by reference.
Bank N.A.) as Trustee, as Lessor
dated as of May 1, 1973, filed as
Exhibit 13(c) to Colonial Gas Energy
System's Registration Statement on
Form S-1. Commission File No. 2-
54673.
10zz Form Employment Agreement for Incorporated herein
corporate officers, filed as Exhibit by reference.
10(kk) to the Registrant's Annual
Report on Form 10-K for the fiscal
year ended December 31, 1992.
10aaa Rate increase deferral incentive Incorporated herein
policy, dated January 1, 1995, filed by reference.
as Exhibit 10(xx) to the
Registrant's Annual Report on Form
10-K for the fiscal year ended
December 31, 1994.
13a Those portions of the 1996 Annual Filed herewith as
Report to Stockholders which have Exhibit 13a.
been incorporated by reference in
Part II Items 5 - 8 and Part IV Item
14 part a 1.
21a Subsidiaries of the Registrant. Filed herewith as
Exhibit 21a.
23a Consent of Independent Certified Filed herewith as
Public Accountants. Exhibit 23a.
____________________
EXECUTIVE COMPENSATION PLANS AND ARRANGEMENTS
Exhibits 10zz and 10aaa above are management contracts or
compensatory plans or arrangements in which the executive
officers of the Company participate.
(b) Reports on Form 8-K.
None
REPORT OF INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS ON SCHEDULE
To the Shareholders of
Colonial Gas Company
In connection with our audit of the consolidated financial
statements of Colonial Gas Company and subsidiaries referred
to in our report dated January 13, 1997, which is included
in the 1996 Annual Report to Stockholders and incorporated
by reference in Part II of this Form 10-K, we have also
audited the schedule listed at Part IV, Item 14(a)2. In our
opinion, this schedule presents fairly, in all material
respects, the information required to be set forth therein.
GRANT THORNTON LLP
Boston, Massachusetts
January 13, 1997
SCHEDULE II
COLONIAL GAS COMPANY AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
For the Three Years Ended December 31, 1996
(In Thousands)
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
ADDITIONS
BALANCE CHARGED BALANCE
AT TO COSTS AT
DESCRIPTION BEGINNING AND DEDUCT- END OF
OF PERIOD EXPENSES IONS PERIOD
For the Year Ended December 31, 1996
Reserve for $2,205 $2,127 $1,617 (1) $2,715
uncollectible accounts
Reserve for insurance $634 $510 $402 $742
claims
For the Year Ended December 31, 1995
Reserve for $1,670 $1,821 $1,286 (1) $2,205
uncollectible accounts
Reserve for insurance $527 $431 $324 $634
claims
For the Year Ended December 31, 1994
Reserve for $1,682 $1,803 $1,815 (1) $1,670
uncollectible accounts
Reserve for insurance $598 $494 $565 $527
claims
_____________________________
(1) Accounts charged off, net of collections.
SIGNATURES
Pursuant to the requirements of Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
COLONIAL GAS COMPANY Date
By s/F.L. Putnam March 25, 1997
F.L. Putnam, Jr., Chairman
of the Board of Directors
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Signature Title Date
s/F.L. Putnam, Jr. Senior Executive Officer, March 25, 1997
F.L. Putnam, Jr. Director
s/Nickolas Stavropoulos Executive Vice President - March 25, 1997
Nickolas Stavropoulos Finance, Marketing and Chief
Financial Officer,Director
(Principal Financial Officer)
s/D.W. Carroll Vice President and Treasurer March 25, 1997
D.W. Carroll (Principal Accounting Officer)
s/V.W. Baur Director March 25, 1997
V.W. Baur
s/J.P. Harrington Director March 25, 1997
J.P. Harrington
s/H.C. Homeyer Director March 25, 1997
H.C. Homeyer
s/R.L. Hull Director March 25, 1997
R.L. Hull
s/D.H. LeVan, Jr. Director March 25, 1997
D.H. LeVan, Jr.
s/F.L. Putnam, III President and Chief March 25, 1997
F.L. Putnam, III Executive Officer, Director
s/J.F. Reilly, Jr. Director March 25, 1997
J.F. Reilly, Jr.
s/A.B. Sides, Jr. Director March 25, 1997
A.B. Sides, Jr.
s/M.M. Stapleton Director March 25, 1997
M.M. Stapleton
s/C.O. Swanson Director March 25, 1997
C.O. Swanson