HOUSTON, July 5, 2002 — El Paso Corp. recently reiterated its commitment to its global LNG and petroleum business following its previously announced strategic repositioning plan.
In a May 29, 2002 press release, El Paso explained that the purpose of the plan is to limit its investment in and exposure to non-cash earnings associated with energy trading and to increase its investment in core natural gas businesses.
Since that time, El Paso has begun implementing the plan in an effort to realign the company’s activities throughout its worldwide offices. The company continues to pursue a rich inventory of opportunities that will provide reliable, sustained earnings internationally.
“El Paso remains committed to its international business activities,” said William A. Wise, chairman, president, and chief executive officer of El Paso Corporation.
“The company has been a member of the international business community for many years, and this plan will only strengthen that relationship through a more concentrated focus on our key assets around the world. Changed market dynamics and a progression toward a global economy provide El Paso an opportunity to continue a strong global presence with particular focus in Europe, Latin America, and Asia. The outlook of our global LNG business is very strong, with opportunities to utilize the EP Energy Bridge technology in areas all over the world. Going forward, El Paso will continue to pursue worldwide energy opportunities as we have in years past.”
The key elements of the strategic repositioning plan include structuring the Merchant Energy segment to further focus on the natural gas opportunities. Following the announcement of the plan, the company immediately began implementing it both domestically with company-wide staff reductions, and internationally with the closing of its trading office in Singapore.
In addition, the company issued $1.56 billion in common shares and equity security units. Future implementation measures will include an increase of capital spending in its production business to $2.3 billion and continuation of an active infrastructure investment program. The company will also be limiting working capital investment in trading activities to $1.0 billion, reducing company-wide annual operating expenses by at least $300 million, and decreasing net debt-to-total capitalization to approximately 49 percent.
El Paso Corporation is a provider of natural gas services. The company has core businesses in natural gas production, gathering and processing, and transmission, as well as liquefied natural gas transport and receiving, petroleum logistics, power generation, and merchant energy services. El Paso Corporation, integrated across the natural gas value chain, is committed to developing new supplies and technologies to deliver energy to communities around the world. For more information, visit www.elpaso.com .