SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2000 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 No. 0-30321 QUESTAR MARKET RESOURCES, INC. (Exact name of registrant as specified in its charter) STATE OF UTAH 87-0287750 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) P.O. Box 45601, 180 East 100 South, Salt Lake City, Utah 84145-0601 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (801) 324- 2600 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 No X Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding as of July 31, 2000 Common Stock, $1.00 par value 4,309,427 shares Registrant meets the conditions set forth in General Instruction H(a)(1) and (b) of Form 10-Q and is filing this Form 10-Q with the reduced disclosure format.
PART I FINANCIAL INFORMATION
Item 1. Financial Statements QUESTAR MARKET RESOURCES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
<TABLE> <CAPTION> 3 Months Ended 6 Months Ended June 30, June 30, 2000 1999 2000 1999 (In Thousands) <S> <C> <C> <C> <C> REVENUES $165,201 $114,222 $ 306,962 $230,068 OPERATING EXPENSES Natural gas and other product purchases 79,790 53,859 143,683 110,251 Operating and maintenance 24,552 19,330 47,470 39,499 Depreciation and amortization 21,151 19,379 42,128 38,984 Write-down of full-cost properties Other taxes 8,044 4,530 15,358 9,658 Wexpro settlement agreement - oil income sharing 1,209 213 2,193 422 TOTAL OPERATING EXPENSES 134,746 97,311 250,832 198,814 OPERATING INCOME 30,455 16,911 56,130 31,254 INTEREST AND OTHER INCOME 1,950 1,800 3,043 2,647 INCOME (LOSS) FROM UNCONSOLIDATED AFFILIATES 306 (31) 1,305 (62) DEBT EXPENSE (6,303) (4,290) (11,673) (8,553) INCOME FROM BEFORE INCOME TAXES 26,408 14,390 48,805 25,286 INCOME TAXES 9,226 3,958 16,574 6,601 NET INCOME $ 17,182 $ 10,432 $ 32,231 $ 18,685 </TABLE>
See notes to consolidated financial statements
<PAGE> QUESTAR MARKET RESOURCES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE> <CAPTION> June 30, December 31, 2000 1999 (Unaudited) (In Thousands) <S> <C> <C> ASSETS Current assets Cash and cash equivalents $ 6,292 Notes receivable from Questar Corp. $ 4,000 Accounts receivable, net 124,080 75,823 Inventories 4,449 11,253 Other current assets 5,218 4,452 Total current assets 140,039 95,528 Property, plant and equipment 1,575,906 1,469,676 Less allowances for depreciation 820,330 778,695 Net property, plant and equipment 755,576 690,981 Investment in unconsolidated affiliates 14,457 13,301 Other assets Cash held in escrow account 4,312 36,727 Securities available for sale 11,449 10,402 Other 3,096 952 18,857 48,081 $928,929 $ 847,891 LIABILITIES AND SHAREHOLDER'S EQUITY Current liabilities Checks outstanding in excess of cash balances $ 1,246 Notes payable to Questar Corp. $ 30,300 24,500
Accounts payable and accrued expenses 106,746 92,278 Total current liabilities 137,046 118,024 Long-term debt 294,548 264,894 Other liabilities 9,988 14,674 Deferred income taxes 69,768 59,936 Minority interest 3,586 2,529 Common shareholder's equity Common stock 4,309 4,309 Additional paid-in capital 116,027 116,027 Retained earnings 293,969 270,388 Other comprehensive loss (312) (2,890) Total common shareholder's equity 413,993 387,834 </TABLE>
$928,929 $ 847,891 See notes to consolidated financial statements
<PAGE> QUESTAR MARKET RESOURCES, INC. AND SUBSIDIARIES CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
<TABLE> <CAPTION> 6 Months Ended June 30, 2000 1999 (In Thousands) <S> <C> <C> OPERATING ACTIVITIES Net income $ 32,231 $ 18,685 Depreciation 42,475 40,468 Deferred income taxes 2,577 358 (Income) loss from unconsolidated affiliates, net of cash distributions (1,155) 624 Gain from sale of securities (896) (388) Changes in operating assets and liabilities (37,077) 4,881 NET CASH PROVIDED FROM OPERATING ACTIVITIES 38,155 64,628 INVESTING ACTIVITIES Capital expenditures Property, plant and equipment (101,455) (43,401) Other investments (10,390) Total (101,455) (53,791) Proceeds from disposition of property, plant and equipment, and investments 6,789 2,499 NET CASH USED IN INVESTING ACTIVITIES (94,666) (51,292) FINANCING ACTIVITIES Change in notes receivable from Questar Corporation 4,000 95,900 Change in notes payable to Questar Corporation 5,800 (144,900) Cash released from escrow account 32,414 Long-term debt issued 37,476 174,327 Long-term debt repaid (6,349) (130,000) Payment of dividends (8,650) (8,300) NET CASH PROVIDED FROM (USED IN) FINANCING ACTIVITIES 64,691 (12,973) Foreign currency translation adjustment (642) 23 CHANGE IN CASH AND CASH EQUIVALENTS $ 7,538 $ 386 </TABLE>
See notes to consolidated financial statements
<PAGE> QUESTAR MARKET RESOURCES, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS June 30, 2000 (Unaudited) Note 1 - Basis of Presentation The interim financial statements reflect all adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. Due to the nature of the business, the results of operations for the three-and six-month periods ended June 30, 2000, are not necessarily indicative of the results that may be expected for the year ending December 31, 2000. For further information refer to the financial statements and footnotes thereto included in the Company's report on Form 10 dated April 12, 2000. Note 2 - Purchase of Canadian Gas and Oil Company On January 26, 2000, a subsidiary of Questar Market Resources (QMR or the Company) acquired 100% of the outstanding shares of Canor Energy Ltd (Canor) from NI Canada ULC, a subsidiary of Northwest Natural Gas Co for cash of $US 61 million plus the assumption of $5.4 million of short-term debt. The transaction was accounted for as a purchase. Canor owns and/or operates more than 800 wells located in Alberta, British Columbia and Saskatchewan provinces of Canada. Canor's proven gas and oil reserves were estimated at 61.1 billion cubic feet equivalent. Assets purchased and liabilities assumed were as follows: (In Thousands) Cash $ 245 Other current assets 3,502 Property, plant and equipment 73,720 Other assets 282 Short-term debt (5,444) Other current liabilities (4,356) Deferred income taxes (4,976) Other liabilities (1,989) Total purchase price, including acquisition costs $ 60,984 Note 3 - Debt Offering On April 12, 2000, QMR filed a registration statement with the Securities and Exchange Commission for a public debt offering. Following effectiveness of such registration statement, QMR intends to issue $150 million of notes and use the proceeds to repay a portion of the outstanding debt. Note 4 - Operations By Line of Business
<TABLE> <CAPTION> 3 Months Ended 6 Months Ended June 30, June 30, 2000 1999 2000 1999 (In Thousands) <S> <C> <C> <C> <C> REVENUES FROM UNAFFILIATED CUSTOMERS Exploration and production - U.S. $ 48,633 $ 35,365 $ 91,169 $ 69,081 Exploration and production - Canada 8,781 2,916 15,754 5,400 Wexpro - cost of service 3,080 739 6,924 2,863 Gas management and energy trading 83,595 56,828 149,713 113,147 $144,089 $ 95,848 $ 263,560 $190,491 REVENUES FROM AFFILIATED COMPANIES Wexpro - cost of service $ 18,103 $ 15,095 $ 35,233 $ 30,189 Gas management and energy trading 3,009 3,279 8,169 9,388 $ 21,112 $ 18,374 $ 43,402 $ 39,577 OPERATING INCOME (LOSS) Exploration and production - U.S. $ 16,095 $ 8,092 $ 29,827 $ 12,779 Exploration and production - Canada 3,080 726 5,153 1,014 Wexpro - cost of service 9,365 7,440 18,396 15,234 Gas management and energy trading 1,915 653 2,754 2,227 OPERATING INCOME $ 30,455 $ 16,911 $ 56,130 $ 31,254 NET INCOME (LOSS) Exploration and production - U.S. $ 8,932 $ 5,016 $ 16,810 $ 7,645 Exploration and production - Canada 662 (22) 1,180 (279) Wexpro - cost of service 5,950 4,770 11,737 9,854 Gas management and energy trading 1,638 668 2,504 1,465 NET INCOME $ 17,182 $ 10,432 $ 32,231 $ 18,685 Note 5 - Comprehensive Income </TABLE>
Comprehensive income is defined as any nonowner change in common equity. Generally, comprehensive income includes earnings reported on the income statement plus changes in common equity formerly reported on the balance sheet only. Other comprehensive income included in this note is comprised of changes in the market value of the investments in securities available for sale and foreign currency translation adjustments. These transactions are not the culmination of the earnings process, but result from periodically adjusting historical balances to market value.
<TABLE> <CAPTION> 3 Months Ended 6 Months Ended June 30, June 30, 2000 1999 2000 1999 (In thousands) <S> <C> <C> <C> <C> Comprehensive Income: Net income $ 17,182 $ 10,432 $ 32,231 $ 18,685 Other comprehensive income (loss) Unrealized gain (loss) on securities available for sale 3,397 (332) 5,517 Foreign currency translation adjust (1,040) (272) (1,560) (491) Other comprehensive income (loss) before income taxes 2,357 (604) 3,957 (491) Income taxes on other comprehensive income (loss) 776 (231) 1,379 (188) Net other comprehensive income 1,581 (373) 2,578 (303) Total comprehensive $ 18,763 $ 10,059 $ 34,809 $ 18,382 income (loss) </TABLE>
tem 2. Management's Discussion and Analysis of Financial Condition and Results of Operations QUESTAR MARKET RESOURCES, INC. June 30, 2000 (Unaudited) Operating Results Questar Exploration and Production, Wexpro, Questar Gas Management and Questar Energy Trading, collectively Questar Market Resources (QMR or the Company), conducts exploration and production, gas gathering and processing, and energy marketing operations. Following is a summary of QMR's financial results and operating information.
<TABLE> <CAPTION> 3 Months Ended 6 Months Ended June 30, June 30, 2000 1999 2000 1999 <S> <C> <C> <C> <C> FINANCIAL RESULTS - (dollars in thousands) Revenues From unaffiliated customers $144,089 $ 95,848 $ 263,560 $190,491 From affiliates 21,112 18,374 43,402 39,577 Total revenues $165,201 $114,222 $ 306,962 $230,068 Operating income $ 30,455 $ 16,911 $ 56,130 $ 31,254 Net income 17,182 10,432 32,231 18,685 OPERATING STATISTICS Production volumes Natural gas (in million cubic feet 17,674 15,341 34,624 30,389 Oil and natural gas liquids (in thousands of barrels) Questar Exploration & Production 563 588 1,117 1,194 Wexpro 140 127 268 268 Total oil and NGL production 703 715 1,385 1,462 Production revenue Natural gas (per thousand cubic feet) $ 2.48 $ 1.93 $ 2.33 $ 1.90 Oil and natural gas liquids (per barrel) $ 20.98 $ 13.99 $ 21.62 $ 12.28 Marketing volumes in energy equivalent decatherms (in thousands of decatherms) 25,180 26,158 52,205 60,317 Natural gas gathering volumes (in thousands of decatherms) For unaffiliated customers 23,261 21,835 45,039 42,126 For Questar Gas 9,235 8,682 19,088 16,919 For other affiliated customers 6,514 4,560 11,678 9,119 Total gathering 39,010 35,077 75,805 68,164 Gathering revenue (per decatherm) $ 0.13 $ 0.15 $ 0.14 $ 0.15 </TABLE>
Revenues Revenues reported for the 2000 periods presented were substantially higher than the revenues for the comparable 1999 periods as a result of higher prices for gas and oil and increased gas production. The average natural gas price per thousand cubic feet (Mcf) rose 28% in the second quarter and 23% in the first half of 2000 when compared with the same periods of 1999. The increase in gas prices reflected a strong demand caused largely by the use of natural gas in the generation of electricity. Oil and natural gas liquids (NGL) prices increased 45% in the second quarter and 71% per barrel in the first half of 2000 (excluding Wexpro's oil production). Oil and NGL prices have increased steadily over the past year as production generally declined and demand rose. Of the current 6 Bcf per month gas production, approximately 42% is covered by hedge contracts at an average price of $2.20 per Mcf, net back to the wellhead. About one-third of the contracts are collars and the remainder are fixed price contracts. The floor price of collar arrangements is used in calculating the average hedged price. Approximately 76% of oil, excluding Wexpro production, is hedged at an average price of $17.14 per barrel, net back to the wellhead through the end of 2001. The second quarter of 2000 includes record production levels with an average monthly production of 7 billion cubic feet equivalent, excluding Wexpro. Production benefited from a successful development drilling program and the first quarter acquisition of Canadian producing properties. Canadian gas production grew 165% to 1.9 billion cubic feet (Bcf). U.S. gas production was 8% above year-ago levels at 15.8 Bcf as increased drilling activity offset a property sale in the fourth quarter of 1999. However, the increased drilling did not fully replace the production of oil and NGL production as a result of selling nonstrategic properties in the fourth-quarter of 1999. Expenses Operating and maintenance expenses were higher in the three-, six- and twelve-month periods of 2000 when compared with the corresponding 1999 periods primarily because of increased investment in producing properties including the acquisition of a Canadian gas and oil company in January 2000. In addition, higher gas prices increased the cost of replacing gas in extraction plant operations. The full-cost amortization rate for U.S. operations dropped $.03 to $.79 per thousand cubic feet equivalent of production (Mcfe) compared with the second quarter of 1999. The U.S. rate is expected to be about $.77 in the third quarter of 2000. The declining U.S. rate has driven the combined U.S. and Canadian full-cost amortization rate to $.80 per energy-equivalent Mcf (Mcfe) for the first half of 2000 compared with $.82 for the comparable 1999 period. The lower rate was due to successfully adding reserves through drilling and purchases, while selling nonstrategic properties at favorable prices. Depreciation and amortization expenses were higher in the 2000 periods presented when compared with the 1999 periods. Increased production volumes from full-cost properties more than offset the lower amortization rates. Increased investment in other properties also resulted in higher depreciation expense in the 2000 periods. Higher commodity prices and increased production volumes resulted in an increase in production-related taxes reported in other taxes on the income statement. Debt expense was higher in the 2000 periods presented because of increased borrowings and higher short-term interest rates. The effective income tax rate for the first half was 34% in 2000 and 26.1% in 1999. The effective income tax rate increased largely because of a reduction in production-related tax credits and a higher portion of earnings coming from Canada, where income tax rates are higher. The Company recognized $2,259,000 of production-related tax credits in the 2000 period and $2,608,000 in the 1999 period. Net income QMR's second quarter net income increased $6.8 million representing a 65% improvement over the second quarter of 1999. First half 2000 net income was 72% higher compared with the first half of 1999. Higher commodity prices and gas production and a lower full-cost amortization rate were primary reasons for the increase. Other factors include higher earnings from Wexpro and gas-management operations. Wexpro's net income increased $1.9 million to $11.7 million in the first half of 2000. Wexpro expanded its investment in development-drilling projects in response to higher regional demand. Wexpro develops gas reserves on behalf of affiliated company, Questar Gas, which is a rate-regulated distributor of natural gas. At year-end 1999, Wexpro earned an average 18.9% after-tax return on investment in those properties. In addition, increased oil and NGL prices resulted in higher earnings for Wexpro and an increase in shared oil profits for Questar Gas. Gas-management and energy-trading operations reported $2.5 million in combined earnings for the first half of 2000 versus $1.5 million a year ago. Volumes of gas gathered increased 11% in the first half of 2000 reflecting more production in the areas served. Higher prices benefited the operations of liquids-extraction plants that experienced improved results for the second quarter and first half of 2000. The plants extract and sell liquids from the natural gas stream. Increased commodity prices caused revenues from energy-marketing activities to be higher in the 2000 periods but were offset by the low value of transportation contracts and settlement of gas imbalances. Liquidity and Capital Resources Operating Activities Net cash provided from operating activities in the first half of 2000 of $38.2 million was $26.5 million less than was generated in the first half of 1999. Cash deposits as a result of hedging account margin calls and timing differences in collection of accounts receivables more than offset the effects of higher net income. The interest-bearing hedging account deposit payments amounted to $36.4 million at June 30, 2000 and were classified as receivables on the balance sheet. Investing Activities Capital expenditures were $101.5 million in 2000, which includes a $60.7 million cash payment, net of cash received, for the purchase of a Canadian company. Capital expenditures for calendar year 2000 are estimated at $175.7 million. Financing Activities QMR financed capital expenditures, including the acquisition of a Canadian company, through borrowings from Questar and from an existing long-term debt arrangement, from net cash provided from operating activities and from cash released from an escrow account. Debt balances owed to Questar as of June 30, 2000, amounted to $30.3 million and $24.5 million at December 31, 1999. QMR filed a registration statement with the Securities and Exchange Commission in order to raise $150 million in a public debt offering. Proceeds of the debt offering will be used to repay a portion of debt outstanding. QMR intends to finance remaining 2000 capital expenditures through net cash provided from operations, borrowings from Questar and borrowings under an existing long-term debt facility. Revenue Recognition Guideline Issued by the Securities and Exchange Commission In December 1999, the SEC issued Staff Accounting Bulletin (SAB) 101, "Revenue Recognition in Financial Statements." The SAB raised issues concerning the timing of recording revenues given that sales transactions may contain some conditions allowing customers to return products or receive refunds. The effect of adopting this accounting guideline is not known at this time because the Company has not completed its evaluation. The SEC has postponed the effective date of this ruling from the second quarter of 2000 to the fourth quarter. Forward-Looking Statements The 10-Q contains forward-looking statements about future operations, capital spending, regulatory matters and expectations of Questar Market Resources. According to management, these statements are made in good faith and are reasonable representations of the Company's expected performance at the time. Actual results may vary from management's stated expectations and projections due to a variety of factors. Important assumptions and other significant factors that could cause actual results to differ materially from those discussed in forward-looking statements include changes in general economic conditions, gas and oil prices and supplies, competition, regulation of the Wexpro settlement agreement, availability of gas and oil properties for sale or for exploration and other factors beyond the control of the Company. These other factors include the rate of inflation and adverse changes in the business or financial condition of the Company. These factors are not necessarily all of the important factors that could cause actual results to differ significantly from those expressed in any forward-looking statements. Other unknown or unpredictable factors could also have a significant adverse effect on future results. The Company does not undertake an obligation to update forward-looking information contained herein or elsewhere to reflect actual results, changes in assumptions or changes in other factors affecting such forward-looking information.
Part II Other Information
Item 1. Legal Proceedings a. Questar Exploration and Production Company ("Questar E&P"), a wholly owned subsidiary of Questar Market Resources, Inc. ("Market Resources" or the "Company") is the primary Questar defendant in a class action lawsuit--Bridenstine v. Kaiser Francis Oil Company--pending in an Oklahoma state court. See the Company's Form 10, Item 8. Legal Proceedings. Both the Company and its parent, Questar Corporation ("Questar") are also named defendants. Plaintiffs have recently claimed additional damages because the defendants allegedly did not market gas volumes for the "best available price." The damages claimed by the plaintiffs increased from an estimated $54 million to an estimated $80 million plus punitive damages. The trail judge delayed the jury trial from August of 2000 to January of 2001, but has not yet ruled on motions filed by the defendants for partial summary judgment. Questar E&P disputes the claims filed by the plaintiffs. b. Questar Energy Trading Company and Questar Gas Management Company, two of the Company's wholly owned subsidiaries, have been added as defendants in a lawsuit filed by Jack Grynberg, an independent producer, pending in a Utah state district court (Grynberg v. Questar Pipeline Company). The lawsuit was originally filed against Questar Pipeline Company, an affiliate of the Company in Questar's Regulated Services unit, in September of 1999. It alleges that the Questar defendants mismeasured gas volumes attributable to his working interest from a property in southwestern Wyoming. The plaintiff cites mismeasurement to support claims for breach of contract, negligent misrepresentation, fraud, breach of fiduciary responsibilities, but does not allege any specific damages. The Questar defendants have filed a comprehensive motion to dismiss the complaint on several grounds including expiration of the applicable statute of limitations, no basis for independent tort claims, and federal preemption. The Company's subsidiaries and affiliates have been involved in several cases filed by Mr. Grynberg alleging gas mismeasurement and resulting underpayment to interest owners. See the Company's Form 10, Item 8. Legal Proceedings, for a description of another case filed by Mr. Grynberg.
Item 6. Exhibits and Reports on Form 8-K a. The following exhibit has been filed as part of this report. Exhibit No. Exhibit 12. Ratio of earnings to fixed charges. b. The Company did not file a Current Report on Form 8-K during the quarter.
SIGNATURES Pursuant to the requirements 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. QUESTAR MARKET RESOURCES, INC. (Registrant) August 11, 2000 /s/G. L. Nordloh (Date) G. L. Nordloh President and Chief Executive Officer August 11, 2000 /s/ S. E. Parks (Date) S. E. Parks Vice President, Treasurer and Chief Financial Officer
EXHIBIT LIST Exhibit Number Exhibit 12. Ratio of earnings to fixed charges.
Exhibit No. 12. Questar Market Resources, Inc. and Subsidiaries Ratio of Earnings to Fixed Charges (Unaudited)
<TABLE> <CAPTION> 12 months ended June 30, 2000 1999 (Dollars in Thousands) <S> <C> <C> <C> Earnings Income from continuing operations before income taxes $87,969 $11,347 Less income Canyon Creek (211) (238) Plus distribution from Canyon Creek 285 277 Plus debt expense 20,483 16,064 Plus interest capitalized during construction 192 1,148 Plus interest portion of rental expense 994 815 $109,712 $29,413 Fixed Charges Debt expense $20,483 $16,064 Plus interest capitalized during construction 192 1,148 Plus interest portion of rental expense 994 815 $21,669 $18,027 Ratio of Earnings to Fixed Charges 5.06 1.63 </TABLE>
1/ For purposes of this presentation, earnings represent income from continuing operations before income taxes and fixed charges. Fixed charges consist of total interest charges, amortization of debt issuance costs, and the interest portion of rental costs (which is estimated at 50%). 2/ Income from continuing operations before income taxes includes QMR's 50% share of pretax earnings of Blacks Fork. 3/ Distributions from Canyon Creek are included and earnings are excluded because QMR owns less than 50%. QMR's ownership
interest in Canyon Creek is 15%. 4/ Write-down of investment in full-cost oil and gas properties reduced income from continuing operations before income taxes by $31 million in the fourth quarter of 1998.
<TABLE> <S> <C> <ARTICLE> 5 <LEGEND> The schedule contains summarized financial information extracted from the Questar Market Resources, Inc. consolidated Statements of Income and Balance Sheet for the period ended June 30, 2000, and is qualified in its entirety by reference to such unaudited financial statements. </LEGEND> <MULTIPLIER> 1,000 <S> <C> <PERIOD-TYPE> 6-MOS <FISCAL-YEAR-END> DEC-31-2000 <PERIOD-END> JUN-30-2000 <CASH> 6,292 <SECURITIES> 11,449 <RECEIVABLES> 124,080 <ALLOWANCES> 0 <INVENTORY> 4,449 <CURRENT-ASSETS> 140,039 <PP&E> 1,575,906 <DEPRECIATION> 820,330 <TOTAL-ASSETS> 928,929 <CURRENT-LIABILITIES> 137,046 <BONDS> 294,548 <PREFERRED-MANDATORY> 0 <PREFERRED> 0 <COMMON> 4,309 <OTHER-SE> 409,684 <TOTAL-LIABILITY-AND-EQUITY> 928,929 <SALES> 0 <TOTAL-REVENUES> 306,962 <CGS> 0 <TOTAL-COSTS> 191,153 <OTHER-EXPENSES> 59,679 <LOSS-PROVISION> 0 <INTEREST-EXPENSE> 11,673 <INCOME-PRETAX> 48,805 <INCOME-TAX> 16,574 <INCOME-CONTINUING> 32,231 <DISCONTINUED> 0 <EXTRAORDINARY> 0 <CHANGES> 0 <NET-INCOME> 32,231 <EPS-BASIC> 0 <EPS-DILUTED> 0 </TABLE>