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EOG Resources, Inc. and Calpine Corporation Sign Innovative Energy Marketing Transaction
PRNewswire
HOUSTON

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FOR IMMEDIATE RELEASE:    Monday, October 16, 2000

EOG Resources, Inc. (EOG) and Calpine Corporation (Calpine) today announced they have signed an innovative one-year marketing agreement that links the daily price of natural gas to the price of electricity. EOG has agreed to sell 10 million cubic feet of natural gas per day directly to Calpine, one of the largest independent power producers in the U.S. The transaction is effective January 1, 2001 and will terminate December 31, 2001.

According to Mark G. Papa, chairman and chief executive officer of EOG, and Diana Knox, senior vice president of Calpine, this mutually beneficial transaction will enable both parties to gain a better understanding of the broader energy markets in the U.S.

"This innovative transaction enables EOG to sell directly to an independent power producer, eliminating third party entities," said Papa. "We expect to learn about the electricity market from participating in this agreement."

"As part of Calpine's fuel management strategy, we are always developing innovative fuel transactions to help supply our power facilities," said Diana Knox, Calpine Senior Vice President. "This transaction will unbundle traditional delivered natural gas services and allow us to work directly with producers that are in close proximity to our projects. This type of transaction may change the way gas is delivered to power generating facilities in the future."

EOG Resources, Inc. is one of the largest independent (non-integrated) oil and gas companies in the United States and is the operator of substantial proved reserves in the U.S., Canada and offshore Trinidad. EOG is listed on the New York Stock Exchange and is traded under the ticker symbol, "EOG."

Based in San Jose, Calif., Calpine Corporation is dedicated to providing customers with reliable and competitively priced electricity. Calpine is focused on clean, efficient combined-cycle, natural gas-fired generation and is the nation's largest producer of renewable geothermal energy. To date, the company has approximately 25,700 megawatts of base load capacity and 4,700 megawatts of peaking capacity in operation, under construction, in announced development and pending acquisitions in 27 states and Alberta, Canada. The company was founded in 1984 and is publicly traded on the New York Stock Exchange under the symbol CPN. For more information about Calpine, visit its website at http://www.calpine.com/.

This press release includes forward looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although EOG believes that its expectations are based on reasonable assumptions, it can give no assurance that such expectations will be achieved. Important factors that could cause actual results to differ materially from those in the forward looking statements herein include, but are not limited to, the timing and extent of changes in reserve quantities and commodity prices for crude oil, natural gas and related products and interest rates, the extent of EOG's success in discovering, developing, producing and marketing reserves and in acquiring oil and gas properties, uncertainties and changes associated with international projects and operations including reserve estimates, markets, contract terms, construction, financing availability, operating costs, and political developments around the world, and conditions of the capital and equity markets during the periods covered by the forward looking statements.

For Further Information Contact:

EOG Resources, Inc
Maire A. Baldwin
713-651-6EOG (651-6364)
www.eogresources.com

Calpine Corp.
Jimmy Glotfelty (Press)
713-830-8633
Katherine Potter (Press)
408-995-5115 ext. 1168
Rick Barraza (Investors)
408-995-5115 ext. 1125
www.calpine.com

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