February 7, 1995 in Nation/World

Wwp Faces $10 Million Court Suit Houston Company Sues Over Williams Lake Project

By The Spokesman-Review
 

Washington Water Power Co. and some of its present and former subsidiaries have been sued by the minority partner in a British Columbia plant that burns wood waste to generate electricity.

Houston-based Tondu Energy Systems Inc. filed its complaint last week in Spokane County Superior Court. The company is seeking $10 million and other damages.

Tondu alleges WWP and a subsidiary, Pentzer Corp., denied it the chance to buy half of the Spokane companies’ one-third interest in the Williams Lake Generating Station.

The facility, modeled after a WWP plant at Kettle Falls, produces 55 megawatts of electricity that are sold to British Columbia Hydro & Power Authority.

Tondu owned one-third of the plant; a subsidiary of B.C. Gas Inc. the other third.

Pentzer sold its interest to B.C. Gas in October 1993, just six months after the plant started operations. Terms were not disclosed, but WWP reported a gain of $7.1 million for the year on the sale of Pentzer’s energy, technology and telecommunications businesses.

Tondu says the terms of the Williams Lake sale were “extremely advantageous to B.C. Gas.”

And, according to the lawsuit, Tondu had made the first offer for Pentzer’s share when informed the Spokane company wanted to sell. Because the partners had agreed to grant each other right of first refusal if one chose to cash out, Tondu informed B.C. Gas of its offer.

B.C. Gas initially indicated it would split Pentzer’s share with Tondu. Instead, Tondu claims, the utility “circumvented” the terms of the partnership by purchasing all the shares of Pentzer Energy Services, the subsidiary that held Pentzer’s interest in Williams Lake.

Since the transaction closed, the lawsuit says, B.C. Gas - now twothirds owner - has made many decisions regarding plant operations without consulting or advising Tondu.

Pentzer President Dick Davis said Monday he would have no comment on the complaint until attorneys have completed a review of the claims. B.C. Gas did not respond to a call seeking comment.

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