Questar's net income jumps 78%

Questar Corp. on Thursday reported $65.8 million in third quarter net income, a 78 percent increase from $36.9 million during the same quarter in 2004.

The earnings for this year's quarter amounted to 75 cents per diluted share, compared to 43 cents per diluted share in last year's quarter.

Revenues for the Salt Lake-based company reached $582.9 million in the third quarter, up from $360.2 million during the same period in 2004.

The energy company on Thursday said hurricane-related supply problems and flat U.S. natural gas production helped to boost new natural gas and oil production by 16 percent in the third quarter compared to the same period a year ago.

Keith O. Rattie, Questar's chief executive officer, said in a prepared statement that overall production will grow by 10 percent by the end of this year.

Net income for 2005 will range from $3.50 to $3.60 per share, said Rattie, adding that 80 percent of the fourth quarter's natural gas and oil production is hedged, leaving fourth-quarter earnings less sensitive to changes in commodity prices.

While acknowledging that high natural gas prices are hurting consumers in Utah and across the country, Rattie blamed federal agencies for not allowing the company to produce more gas this winter.

"If only federal agencies will let us," Rattie said. "One would think federal agencies would welcome innovative, environment-friendly proposals to produce more lower-cost gas from public lands this winter. We've made a proposal to do just that, but it's hung up in a bureaucratic quagmire."

Questar Gas, the company's regulated utility, reported a seasonal loss of $9.9 million in the third quarter of 2005, compared to a $9.8 million loss a year earlier.

Questar Gas has 803,000 customers in Utah, Wyoming and Idaho.

Earlier this week, Questar Gas asked Utah regulators for a 20.3 percent hike in what it charges its customers for natural gas. Questar said the latest request will raise the typical residential customer's monthly bill by roughly $18.

Questar Gas expects it will recover $3.6 million of costs attributed to a gas-processing plant that were expensed from Feb. 1, 2005, through Sept. 30, 2005.

Under a pending agreement, Questar will be allowed to recover about $5.7 million annually in processing costs through January 2008.

Questar announced its earnings after financial markets closed Thursday. Prior to the announcement, Questar stock fell $1.73, or 2.2 percent, to close at $76 per share on the New York Stock Exchange. In the past year, the price has ranged from $46.73 to $89.60.

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