Public Service Co. of New Mexico (PNM) announced that it had settled against an unspecified number insurance companies, individuals and other entities in litigation stemming from the alleged “under-performance” of insurance taken out for the decommissioning of a nuclear power plant.
As a result, PNM will record a one-time gain of $13.75 million, or an estimated 21 cents per share of common stock (diluted), in the third quarter of 2000. The insurance plan, initiated by PNM in 1987, was taken out to fund a portion of the company’s obligations for the decommissioning of Palo Verde nuclear plant in Arizona.
PNM stated that the program had fallen short of the company’s expectations and was discontinued in 1999. PNM operates a combined electric and gas utility serving approximately 1.3 million people in New Mexico and sells power on the wholesale market. The wholly owned subsidiary of PNM, Avistar, operates an advanced meter servicing business in California and Nevada, and offers energy and water management services for government and institutional clients in the Southwest. In Sept. 5 trade on the New York Stock Exchange, shares of PNM finished up 1/16 at 21-1/16.
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