ML20155C064

Applicant Advice to Aslab.* Forwards Massachusetts Municipal Wholesale Electric Co Press Release Re Plans for Withdrawal from Plant & Restructuring of Company Debt to Moderate Rate Impacts.W/Certificate of Svc

ML20155C064
Person / Time
Site:	Seabrook
Issue date:	06/02/1988
From:	Dignan T PUBLIC SERVICE CO. OF NEW HAMPSHIRE, ROPES & GRAY
To:
References
CON-#288-6457 OL-1, NUDOCS 8806140068
Download: ML20155C064 (7)

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NUCLEAR REGULATORY COMMIS$'f0N B".f '

before the ATOMIC SAFETY AND LICENSING APPEAL BOARD

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In the Matter of )

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PUBLIC SERVICE COMPANY OF ) Docket Nos. 50-443-OL-1 NEW HAMPSHIRE, et al. ) 50-444-OL-1

) On-site Emergency (Seabrook Station, Units 1 and 2) ) Planning Issues

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APPLICANTS' ADVICE TO APPEAL BOARD Applicants enclose herewith a press release of one of the joint owners, Massachusetts Municipal Wholesale Electric Company ("MMWEC"), which owns 11.5934% of Seabrook Station.

At present we do not have information additional to that contained in the press release. We are advised by project management, however, that MMWEC's a*.inouncement will have no j immediate effect on meeting projected project requirements.

We will, of course, keep this Appeal Board advised as to future developments concerning this matter.

Respectfully submitted, Thomas W Dignan, Jr.

George H. Lewald Kathryn A. Selleck I Ropes & Gray 225 Franklin Street 8806140068 880602 Boston MA 02110 DR ADOCK 05000 3 g (617) 423-6100

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A P u a t I c c o A P o a a r i o n June 1, 1988  ;

TOR I)0iEDIATE RELEASE I MMVEC slans Saibreek withdrsv11. debt fastructuring l

LUDLoV Directors of the Massachusetts Municipal Wholesale  :

Electric Co. (MMVEC) today adopted a plan of action that calls for f withdrawal from the Seabrook Station nuclear project and restructuring of the co::pany's seabrook debt to moderate rate icpacts.

Under the plan racer ended by Central Manager Cary L. Nunt,  !

MHVEC will seek an agree:ent with other project owners "to take l YSEC out of the project in a financially responsibis =anner."  ;

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.MWEC, which ovnt an 11.59 percent share of Seabrook, also will seek state cooperation in restructurin5 its debt in order to moderate rates.

• In addition, the plan leaves open the possibility of legal action by MMUEC to recover Its $875 million Seabrook investment.

As the first step toward withdrawal, MMWEC will not make a payment of approximately $2 million due to the project today, h co=pany has prepaid about three months worth of seabrook payments and will draw from those prepayments while it pursues negotiations l vich other project owners, Hunt said that details regarding HHWEC's withdrawal frem the project will be determined by the course of negotiations with other proj ect owners, ,

more PCR MCat tNPCRM4cN contact: DMO fuCHfY, P.C. BOX 426, LUDLOW, MMS. CiCS4 41lI/$494141

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MEC/Seabrook decision l

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3 card Chair:an George leary said the decision is based on a sound business judg:ent of the economics and mounting uncertaincies associated with 3eabrook, "After taking a hasd look at the greving costs and uncertain benefits, and vacching the obstacles to plant licensing grow al:ost daily, this is the best decision for NC frem a business standpoint,"Learysaid.

Leary stressed that MIC intends to repay the coney it has borrowed for seabrook.

"NEC bondholdars should take heate in today's action,' he said. ";t actually improves their security by reducing the uncertaintyandfinancialstressas30ClatedWithSeabrook.

An icportant factor in NEC's decision is the Jan, 28 bankruptcy filing by Public Service of New 'dupshira (PSRI),

Seabrook's principal owner. The bankruptcy jeopardites an a5reement betvsen M EC and P'sNH that adds nearly $200 million in value to the project for NEC.

In addition, slippage in the schedule for Seabrook's j operation caused by legal dalays in licensing the plant have cut deeply into the Value of Seabroek to N EC.

"The risks have just become too high to jutify continued invastaant in the project." I.tary said.

As part of its plan to modarate rate impacts, N EC will file a petition wLeh the state Department of Public Utilities requesting authority to refinance its high interts; and taxable l Seabrook debt. It also will seek approval from Cov. Michael S. ,

Dukakis to refinanca using tax exempt bonds. j more

M EC/Seabrook decision - 3 Inaddi$1cn,MICwillseekstatebackingforits

' refinancin5, which veuld reduce borrowing costs substantially and lead to further rata moderation.

"It is in 8Very0nt's b88t interest to lover the cost of paying for Seabrook," Hunt said.

"I think today ve have established the basis for a new en of eceparation hetveen EiEC and the Comonwealth,' I.sarf said.

"Seabrook has consu:sd too much of our time for too long, and the time has co:ne to begin our life after Seabrook."

Hunt said today's dacision Vill enable FXwT.C to devote more time to finding solutions to the power supply problems facing its members,theStateandNewEngland.

"I'here is a lot of work to be done in the areas of power supply, conservation,datandmanagtmentand&Widerangeofother energy services and policios," he said.

"Working in a spirit of cooperation with the Co m onwealth, we can help to ensure that Massachusetts has a sound and secura energyfuture,"hesaid, 30-l l

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CERTIFICATE OF SERVICE I, Kathryn A. Selleck, one of the attorneys for the Applicants herein, hereby certify that on June 2, 1988, I made service of the within document by depositing copies thereof with Federal Express, prepaid, for delivery to (or where indicated, by depositing in the United States mail, first class, postage paid, addressed to):

Alan S. Rosenthal, Chairman Howard A. Wilber Atomic Safety and Licensing Atomic Safety and Licensing Appeal Panel Appeal Panel U. S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission East West Towers Building East West Towers Building 4350 East West Highway 4350 East West Highway Bethesda, MD 20814 Bethesda, MD 20814 Thomas S. Moore Mr. Ed Thomas Atomic Safety and Licensing FEMA, Region I Appeal Panel 442 John W. McCormack Post U.S. Nuclear Regulatory Office and Court House Commission Post Office Square East West Towers Building Boston, MA 02109 4350 East West Highway Bethesda, MD 20814 Administrative Judge Sheldon J. Robert Carrigg, Chairman Wolfe, Esquire, Chairman Board of Selectmen Atomic Safety and Licensing Town Office Board Panel Atlantic Avenue U.S. Nuclear Regulatory North Hampton, NH 03862 Commission East West Towers Building 4350 East West Highway Bethesda, MD 20814 Administrative Judge Emmeth A. Diane Curran, Esquire Luebke Andrea C. Ferster, Esquire 4515 Willard Avenue Harmon & Weiss Chevy Chase, MD 20815 Suite 430 2001 S Street, N.W.

Washington, DC 20009 Dr. Jerry Harbour Stephen E. Merrill, Esquire Atomic Safety and Licensing Attorney General Board Panel George Dana Bisbee, Esquire U.S. Nuclear Regulatory Assistant Attorney General Commission Office of the Attorney General ,

East West Towers Building 25 Capitol Street i 4350 East West Highway Concord, NH 03301-6397  ;

Bethesda, MD 20814 j l

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Adjudicatory File Atomic Safety and Licensing Sherwin E. Tura, Esquire Board Panel Docket (2 copies) Office of General Counsel U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission East West Towers Building One White Flint North, 15th F1.

4350 East West Highway 11555 Rockville Pike Bethesda, MD 20814 Rockville, MD 20852

• Atomic Safety and Licensing Robert A. Backus, Esquire Appeal Board Panel Backus, Meyer & Solomon U.S. Nuclear Regulatory 116 Lowell Street Commission P.O. Box 516 Washington, DC 20555 Manchester, NH 03105 Philip Ahrens, Esquire Mr. J. P. Nadeau Assistant Attorney General Selectmen's Office Department of the Attorney 10 Central Road General Rye, NH 03870 Augusta, ME 04333 Paul McEachern, Esquire Carol S. Sneider, Esquire Matthew T. Brock, Esquire Assistant Attorney General Shaines & McEachern Department of the Attorney 25 Maplewood Avenue General P.O. Box 360 One Ashburton Place, 19th Flr.

Portsmouth, NH 03801 Doston, MA 02108 Mrs. Sandra Gavutis Mr. Calvin A. Canney Chairman, Board of Selectmen City Manager RFD 1 - Box 1154 City Hall Route 307 126 Daniel Street Kensington, NH 03827 Portsmouth, NH 03801

• Senator Gordon J. Humphrey R. Scott Hill-Whilton, Esquire U.S. Senate Lagoulis, Clark, Hill-Washington, DC 20510 Whilton & McGuire (Attn: Tom Burack) 79 State Street Newburyport, MA 01950

• Senator Gordon J. Humphrey Mr. Peter S. Matthews One Eagle Square, Suite 507 Mayor Concord, NH 03301 City Hall (Attn: Herb Boynton) Newburyport, MA 01950 Mr. Thomas F. Powers, III Mr. William S. Lord Town Manager Board of Selectmen Town of Exeter Town Hall - Friend Street 10 Front Street Amesbury, MA 01913 Exeter, NH 03833

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e H. Joseph Flynn, Esquire Brentwood Board of Selectmen Office of General Counsel RFD Dalton Road Federal Emergency Management Brentwood, NH 03833 Agency 500 C Street, S.W.

Washington, DC 20472 Gary W. Holmes, Esquire Richard A. Hampe, Esquire Holmes & Ells Hampe and McNicholas 47 Winnacunnet Road 35 Pleasant Street Hampton, NH 03841 Concord, NH 03301 Judith H. Mizner, Esquire Charles P. Graham, Esquire 79 State Street, 2nd Floor Murphy and Graham Newburyport, MA 01950 33 Low Street

? Newburyport, MA 01950 l .b Kathryn A. Selleck

(*=U.S. First Class Mail.)

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