OGE Energy’s (NYSE:OGE) exit from a midstream gas joint venture continues to pay dividends for the Oklahoma City-based utility.
CEO Sean Trauschke said Thursday that OGE has shed 77% of its limited partner units in Enable Midstream Partners for an $813 million return at an average price of $11.09/unit. Trauschke said that’s a 33% premium from where the units were when OGE and CenterPoint Energy completed Enable’s $7.2 billion sale to Energy Transfer Partners in December. (See OGE, CenterPoint Complete Enable’s Disposal.)
“Interestingly, we’ve already received more net proceeds than the value of our investment when the transaction closed,” Trauschke told financial analysts during the company’s quarterly earnings call. “We’re pleased with the pace of our progress and the value that we’ve captured for our shareholders.”
OGE also received $750 million worth of securitization bonds in July stemming from the February 2021 winter storm. The company has also filed a request with Arkansas regulators to recover $80 million in storm costs over 10 years.
CFO Bryan Buckler said the revenues will be deployed so that OGE will not have to issue equity with its five-year, $475 billion capital investment plan. Much of that plan is customer-focused transmission and distribution assets.
OGE reported earnings of $73.1 million ($0.36/diluted share) during the quarter, as compared to $112.9 million ($0.56/diluted share) for the same period a year ago. It said earnings were primarily driven by more favorable weather and recovery of capital investments.
A partial reversal of a first-quarter interim period consolidating tax benefit related to mark-to-market activity and the gain from Energy Transfer unit sales resulted in a 5-cents/diluted share hit.
Trauschke said its Oklahoma Gas & Electric subsidiary’s grid has performed well during the summer, which has seen 18 days above 100 degrees Fahrenheit since June 1.
“The grid has not been strained; we’ve not cautioned the public about potential blackouts or asked for conservation,” he said. “I’m proud of the performance of our system and employees.”
OGE’s share price lost 54 cents during a down day for the Dow Jones Industrial Average, closing at $40.13.
