Williams shares tumble on energy trading subpoena

TULSA, Okla. (AP) _ Williams Cos. stock plunged 19 percent Monday as investors reacted to a federal grand jury subpoena of the company's California energy trading records. <br><br>Williams received

Monday, November 11th 2002, 12:00 am

By: News On 6

TULSA, Okla. (AP) _ Williams Cos. stock plunged 19 percent Monday as investors reacted to a federal grand jury subpoena of the company's California energy trading records.

Williams received the subpoena from federal prosecutors in San Francisco as part of a grand jury investigation, Williams said after the market closed Friday.

Charlotte, N.C.-based Duke Energy and Houston-based Reliant Resources Inc. said they have also received subpoenas. The three companies, which California utility regulators have accused of scheming to drive up energy prices during the state's power crisis in 2000 and 2001, said they would cooperate.

The subpoena was another setback for Tulsa-based Williams as it tries find a joint venture partner or a buyer for its struggling energy trading business.

Williams shares fell 49 cents, or 19 percent, to $2.12 Monday morning on the New York Stock Exchange. The stock has a 52-week high of $30.40.

Duke shares fell $1.21, or 6 percent, to $18.75 Monday. Reliant dropped 25 cents, or 11 percent, to $2.

The subpoena asked Williams for documents relating to its energy trading contracts and information about key people involved in its California energy trades, Williams spokesman Kelly Swan said Monday.

Matt Jacobs, an assistant U.S. Attorney in San Francisco, said Friday he could not comment on the subpoenas because the case is ongoing.

The California Public Utilities Commission issued a report in September accusing five energy companies _ including Williams, Reliant and Duke _ of causing the state's rolling blackouts by withholding power.

Williams, which provides fuel to three AES power plants in the Los Angeles area, has denied withholding any power during the crisis.

Williams' energy trading division is also being investigated by the Federal Energy Regulatory Commission and the Commodity Futures Trading Commission.

The company said last month that a few of its energy traders provided false information about energy trades to an industry publication whose price index is often used to price natural gas contracts.

Also, California is asking federal regulators to force energy traders including Williams to refund $9 billion in alleged overcharges stemming from power contracts signed after energy prices there soared.

Energy trading chief executive and president Bill Hobbs has said the investigations and the possible downgrade of the California contracts are repelling potential buyers or partners of the trading unit.

Enron Corp.'s collapse has caused investors and analysts to look harder at other energy traders' debt. Williams credit has since been lowered below investment grade, preventing the company from signing any long-term energy trading contracts.

The unit, which accounted for half the company's operating profit in 2001, lost $497.5 million in the second quarter.