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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report:
DECEMBER 22, 2004
(Date of Earliest Event Reported: December 21, 2004)
[ELPASO LOGO]
EL PASO NATURAL GAS COMPANY
(Exact name of Registrant as specified in its charter)
Delaware 1-2700 74-0608280
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
El Paso Building
1001 Louisiana Street
Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 420-2600
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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ITEM 8.01. OTHER EVENTS.
On December 21, 2004, El Paso Natural Gas Company (EPNG) entered into a
Precedent Agreement with its largest customer, Southern California Gas Company
(SoCalGas). Under the terms of the Precedent Agreement, SoCalGas has agreed to
re-contract, effective September 1, 2006, for an annual average of approximately
750 MMcf/d of capacity on EPNG's pipeline system to serve SoCalGas' "core"
(residential and small commercial) customers -- which is nearly all the core
capacity SoCalGas currently holds on EPNG. Following the satisfaction of
specified conditions, the Precedent Agreement provides for the parties to
execute new service agreements having a primary term of three to five years
at rates that are, on average, less than EPNG's current maximum rates. Such
conditions include SoCalGas' receipt of approval from the California Public
Utilities Commission (CPUC) and the successful awarding of the capacity to
SoCalGas following the post and bid process required by EPNG's tariff.
As reported in EPNG's Annual Report on Form 10-K for the year ending
December 31, 2003, the main contract between EPNG and SoCalGas, for
approximately 1.2 Bcf/d of capacity on EPNG's system, expires in 2006. The
remaining capacity from the expiring contracts historically has been used by
SoCalGas to serve "non-core" (large commercial, industrial) customers. The CPUC
is considering whether the California utilities should be required in the future
to hold capacity to serve their non-core customers. EPNG is continuing its
efforts to re-contract this capacity directly with such non-core customers, or
with other parties, depending on the CPUC's decision. Whether that capacity will
be re-contracted by EPNG is unknown at this time.
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.
EL PASO NATURAL GAS COMPANY
DATED: DECEMBER 22, 2004 BY: /S/ GREG G. GRUBER
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GREG G. GRUBER
SENIOR VICE PRESIDENT, CHIEF FINANCIAL
OFFICER, TREASURER AND DIRECTOR
(PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER)