Profile: Spire Inc (SR.N)
2 Dec 2016
Spire Inc, formerly The Laclede Group, Inc. (Laclede Group), incorporated on October 18, 2000, is a public utility holding company for Laclede Gas Company (Laclede Gas or the Missouri Utilities). The Company operates through two segments: Gas Utility and Gas Marketing. The Gas Utility segment includes the regulated operations of Laclede Gas and Alabama Gas Corporation (Alagasco or the Alabama Utility) (collectively, the Utilities). Laclede Gas is a public utility engaged in the purchase, retail distribution and sale of natural gas, serving over 1.1 million residential, commercial and industrial customers, through Missouri Gas Energy (MGE), Kansas City and western Missouri. Alagasco is a public utility engaged in the purchase, retail distribution and sale of natural gas in central and northern Alabama, serving over 0.4 million residential, commercial and industrial customers with primary offices located in Birmingham, Alabama. The Gas Marketing segment includes Laclede Energy Resources, Inc. (LER), a subsidiary the Company, which is engaged in the marketing of natural gas and related activities on a non-regulated basis.
Laclede Gas focuses its gas supply portfolio around a number of natural gas suppliers with equity ownership or control of assets situated to complement its regionally diverse firm transportation arrangements. Laclede Gas utilizes both Mid-Continent and Gulf Coast gas sources to provide a level of supply diversity that facilitates the optimization of pricing differentials, as well as protecting against the potential of regional supply disruptions. MGE utilizes both Mid-Continent and Rocky Mountain gas sources to provide a level of supply diversity that accesses low cost supplies while providing a natural gas price arbitrage. For its eastern service area, Laclede Gas has a contractual right to store approximately 21.6 billion cubic feet of gas as of September 30, 2015, in Enable Mississippi River Transmission LLC (MRT)'s storage facility located in Unionville, Louisiana; approximately 16.3 billion cubic feet of gas storage in Southern Star system storage facilities located in Kansas and Oklahoma, and approximately 1.4 billion cubic feet of firm storage on Panhandle Eastern Pipe Line Company, LP's (PEPL's) system storage.
Alagasco's distribution system is connected to two interstate natural gas pipeline systems, Southern Natural Gas Company, L.L.C. (Southern Natural Gas) and Transcontinental Gas Pipe Line Company, LLC (Transco). It is also connected to two intrastate natural gas pipeline systems. Alagasco purchases natural gas from various natural gas producers and marketers. The properties of Alagasco consist primarily of its gas distribution system, which includes approximately 23,000 miles of main and service lines, odorization and regulation facilities, and customer meters. Alagasco also has approximately four liquefied natural gas (LNG) facilities and several operation centers. Alagasco has a contractual right to store approximately 12.5 billion cubic feet of gas with Southern Natural Gas, approximately 0.2 billion cubic feet of gas with Transco and approximately 0.2 billion cubic feet with Tennessee Gas Pipeline at September 30, 2015.
LER is engaged in the marketing of natural gas and providing energy services to both on-system utility transportation customers and customers outside of the Missouri Utility's traditional service area. As of September 30, 2015, LER utilized approximately 20 interstate and intrastate pipelines, and approximately 100 suppliers to market natural gas to its customers primarily in the Midwest. LER serves approximately 220 retail customers and approximately 120 wholesale customers as of September 30, 2015. Through its retail operations, LER offers natural gas marketing services to large commercial and industrial customers, while its wholesale business consists of buying and selling natural gas to other marketers, producers, utilities, power generators, pipelines and municipalities.
In the course of its business, LER enters into agreements to purchase natural gas at a future date in order to lock up supply to cover future sales commitments to its customers. To secure access to the markets it serves, LER contracts for transportation capacity on various pipelines from both pipeline companies and through the secondary capacity market from third parties. As of September 30, 2015, LER held approximately 0.4 billion cubic feet per day of firm transportation capacity. In addition, to ensure reliability of service and to provide operational flexibility, LER enters into firm storage contracts and interruptible park and loan transactions with various companies, where it is able to buy and retain gas to be delivered at a future date, at which time LER sells the natural gas to third parties. As of September 30, 2015, LER has contracted for approximately 4.5 billion cubic feet of such storage and park and loan capacity.
700 Market St Fl 6
ST. LOUIS MO 63101-1829