PRESS RELEASES 2003
FOR IMMEDIATE RELEASE
July 08, 2003
ISSUED BY:   PG&E Corporation and Pacific Gas and Electric Company
Please call 800-PGE-NEWS or 415-973-5930 for more information.

EDITORS: Please do not use "Pacific Gas and Electric" or "PG&E" when referring to PG&E Corporation or its National Energy Group. The PG&E National Energy Group is not the same company as Pacific Gas and Electric Company, the utility, and is not regulated by the California Public Utilities Commission. Customers of Pacific Gas and Electric Company do not have to buy products or services from the National Energy Group in order to continue to receive quality regulated services from Pacific Gas and Electric Company.

PG&E CORPORATION REPORTS CHAPTER 11 FILING OF PG&E NATIONAL ENERGY GROUP UNITS

SAN FRANCISCO, CA - PG&E Corporation (NYSE: PCG) today reported that, as expected, its PG&E National Energy Group, Inc. (PG&E NEG) unit and certain PG&E NEG subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Maryland, Greenbelt Division.

As previously disclosed, PG&E Corporation does not expect that the outcome of PG&E NEG's bankruptcy proceedings will have a material adverse effect on the financial condition of PG&E Corporation, which has no material obligations to PG&E NEG.

In May 2003, PG&E Corporation stated that the restructuring of PG&E NEG would inevitably be implemented through a Chapter 11 proceeding and that a bankruptcy filing could take place as early as the second quarter of 2003. Although PG&E Corporation worked hard and in good faith for many months to structure an agreement that would allow PG&E Corporation to retain ownership of PG&E NEG for the benefit of the Corporation's shareholders, those efforts were ultimately unable to produce a consensus among creditors.

The Plan of Reorganization filed by PG&E NEG provides that PG&E Corporation will have no equity interest in PG&E NEG or any of its subsidiaries after its Chapter 11 reorganization plan is implemented. The entities filing for Chapter 11 reorganization today are:

  • PG&E National Energy Group, Inc.;
  • PG&E Energy Trading Holdings Corporation;
  • PG&E Energy Trading – Gas Corporation;
  • PG&E Energy Trading – Power Corporation;
  • PG&E ET Investments Corporation; and
  • USGen New England, Inc.

Other PG&E NEG subsidiaries, including PG&E Gas Transmission Northwest and numerous independent electric producers, are not filing for Chapter 11 reorganization. It is expected that day-to-day operations at these affiliates will be largely unaffected by today's Chapter 11 filings.

PG&E Corporation has no equity infusion agreements, material contingent liabilities, or tax-sharing agreement with PG&E NEG. The Corporation also does not expect the outcome of PG&E NEG's bankruptcy to have any effect on its utility subsidiary, Pacific Gas and Electric Company, or the utility's reorganization plan and proposed settlement agreement to end its Chapter 11 bankruptcy.

“Today's Chapter 11 filings are the next step forward for PG&E NEG and its creditors, and they advance the Corporation's goal of resolving uncertainties we have been managing since the onset of the energy crisis,” said Robert D. Glynn, Jr., Chairman, CEO and President of PG&E Corporation. “Moving forward, PG&E Corporation will continue to focus on several critical objectives, including implementing the proposed settlement agreement to end the utility's Chapter 11 case, maximizing the value of our utility operations, and strengthening our balance sheet.”

A conference call with the financial community will be held today at 11:30 a.m. Eastern time to discuss PG&E NEG's Chapter 11 filing. The call will be open to the public on a listen-only basis via webcast. Please visit our website, www.pge-corp.com, for more information and instructions for accessing the webcast. A replay of the conference call will be available toll-free by calling (877) 690-2089 and also will be available on our website. International callers will be able to access the replay by dialing (402) 220-0645.

This press release contains forward-looking statements regarding the anticipated effect of the Chapter 11 proceedings of PG&E NEG and various of its affiliates on PG&E Corporation. These statements are necessarily subject to various risks and uncertainties. These statements are based on current expectations and assumptions which management believes are reasonable and on information currently available to management. Actual results could differ materially from those contemplated by the forward-looking statements due to several factors including whether and the extent to which the Bankruptcy Court having jurisdiction over such Chapter 11 proceeding determines that claims which may be asserted against PG&E Corporation in such proceeding are meritorious.


 

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