Other Energy-Related Ventures - Wholesale Energy Services
Nicor Transmission System
Hub Administration
- Balancing, parking and wheeling services
- Firm off-system supply-related services
Enerchange
- Wholesale natural gas marketing
- Manages Fixed Bill
Notes:
Let me now turn to our asset-backed energy ventures. The first of these is the Chicago Hub. The Chicago Hub operates within the utility and was formed in 1994 to capitalize on our strategic location on the U.S. pipeline grid and our 140 Bcf of natural gas storage capacity. The Hub provides interruptible natural gas parking, loaning and wheeling services to marketers and interstate pipeline shippers moving gas through the Midwest and allows us to realize additional value from our supply portfolio and storage capabilities through a variety of transportation and storage services. The availability of these services has been a significant factor in the liquidity of the Midwest market for natural gas, which is key for successful unbundling of supply services.
We also have an unregulated wholesale natural gas marketing business, Nicor Enerchange, which was formed in 1998 as another opportunity for us to benefit from our knowledge of the Midwest natural gas supply grid. Enerchange, which also administers the Chicago Hub for a fee, is engaged in wholesale marketing of natural gas supply services in the Midwest and provides these services to interstate pipelines, other gas distribution companies, power generators and gas marketers and brokers. By bundling commodity with customized services, like natural gas transportation, and storage services, Enerchange can customize services that provide customers with significant value.
These ventures are starting to show a meaningful impact on earnings and posted nearly $20 million of pre-tax income in 2001- up from $13 million the year before. More importantly, we remain confident in their ability to sustain growth going forward.