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Clarke-Mobile Gas District gets improved credit ratings
Moody's bettered Clarke- Mobile's rating from a "Baa2" to a "Baa1" rating. The next level would be an "A3." Standard & Poor's improved the utility's rating to "investment-grade." C. J. Arnold of Clarke-Mobile's ACT management team presented the new ratings at Tuesday's board meeting. "These ratings will help the district receive lower bond insurance premiums and lower interest rates in the bond market," said Reid Cavnar of Merchant Capital, LLC, a firm that assists Clarke-Mobile in bond issues and other projects. Competitive gas rates Arnold also presented charts that compare Clarke-Mobile's natural gas rates for residential and industrial users to others in the state. The figures are from the Energy Information Administration and are available on the Internet. Clarke-Mobile ranked 31 out of 77 utilities in 2006 for residential rates with a rate of about $16 to $17 MCF. The rates ranged from a low of just over $5 for the Town of Camp Hill ("They can't sell it for that," Arnold said) to a high approaching $25 for the Town of Brookside. Citronelle posted rates a little less than Brookside as did the gas service in Mobile. Clarke-Mobile ranked third lowest out of 53 utilities for industrial rates, posting a rate just under $8 MCF. Crosstex Energy Services and the City of Bay Minette posted rates slightly lower. The City of Fairhope had the highest rates in 2006, over $17 MCF. Arnold said he has done rate studies all over the southeast. "I don't know of another system that marks up less than Clarke- Mobile. We are certainly on the right end of the chart and headed in the right direction." Tommie Horsley, another ACT manager, said Clarke-Mobile has rated the lowest in industrial rates at times in 2007. Clarke-Mobile sees competitive industrial rates as a way to help lure industry to the region and to help the area grow. Large industrial users also give the utility a more stable financial footing. ThyssenKrupp contract Clarke-Mobile directors and managers remain optimistic about getting ThyssenKrupp's business for the new $3.7 billion steel mill being built at Calvert. Clarke-Mobile relocated its gas lines that cross the Calvert property and has been working intensely with ThyssenKrupp to secure what many believe will be a lucrative contract. The rerouting cost over $7 million but that cost will be reimbursed by the state. Clarke- Mobile won't be as lucky in having to reroute its lines on the west side of Highway 43 across from the plant site. An overpass entrance to the plant will be built over Highway 43, necessitating $800,000 to $900,000 in rerouting expenses that the utility will have to absorb. Mayors and managers attended the groundbreaking at Calvert a few weeks ago as well as an evening reception and dinner at the recently opened Battle House Hotel in Mobile where the utility was one of the sponsors. "We were the only gas district there and we got good exposure" from ThyssenKrupp and others in attendance, said Mayor Day. Other business Horsley reported that the new Clarke-Mobile administration building in Jackson is 45 percent complete. Work has started on the renovation of District Attorney Spence Walker's old law office in Grove Hill for an office and plans are underway to redo the office in Thomasville. A report on appliance, ventilation and repair training was given along with the explanation that the training amounts to a virtual associate degree in gas technology. Al Bean, one of the ACT managers, said the forecast is for warm weather, with maybe a little cooling off in early December- not good weather if you are in the gas business, he explained.
The directors had previously been presented with a $118 million budget for the coming year and they approved it as the meeting concluded.
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