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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
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THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2013
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
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THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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41-0423660
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $1.00
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New York Stock Exchange
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Large accelerated filer
x
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Accelerated filer
o
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Non-accelerated filer
o
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Smaller reporting company
o
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AFUDC
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Allowance for funds used during construction
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Army Corps
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U.S. Army Corps of Engineers
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ASC
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FASB Accounting Standards Codification
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BART
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Best available retrofit technology
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Bbl
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Barrel
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Bcf
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Billion cubic feet
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Bicent
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Bicent Power LLC
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Big Stone Station
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475-MW coal-fired electric generating facility near Big Stone City, South Dakota (22.7 percent ownership)
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Black Hills Power
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Black Hills Power, Inc.
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BLM
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Bureau of Land Management
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BOE
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One barrel of oil equivalent - determined using the ratio of one barrel of crude oil, condensate or natural gas liquids to six Mcf of natural gas
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BOPD
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Barrels of oil per day
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Brazilian Transmission Lines
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Company's investment in the company owning ECTE, ENTE and ERTE (ownership interests in ENTE and ERTE were sold in the fourth quarter of 2010 and portions of the ownership interest in ECTE were sold in the third quarters of 2013 and 2012 and the fourth quarters of 2011 and 2010)
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Btu
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British thermal unit
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Calumet
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Calumet Specialty Products Partners, L.P.
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Cascade
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Cascade Natural Gas Corporation, an indirect wholly owned subsidiary of MDU Energy Capital
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CCU
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Cane Creek Unit
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CEM
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Colorado Energy Management, LLC, a former direct wholly owned subsidiary of Centennial Resources (sold in the third quarter of 2007)
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Centennial
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Centennial Energy Holdings, Inc., a direct wholly owned subsidiary of the Company
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Centennial Capital
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Centennial Holdings Capital LLC, a direct wholly owned subsidiary of Centennial
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Centennial Resources
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Centennial Energy Resources LLC, a direct wholly owned subsidiary of Centennial
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CERCLA
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Comprehensive Environmental Response, Compensation and Liability Act
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Clean Air Act
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Federal Clean Air Act
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Clean Water Act
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Federal Clean Water Act
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Colorado State District Court
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Colorado Thirteenth Judicial District Court, Yuma County
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Company
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MDU Resources Group, Inc.
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Coyote Creek
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Coyote Creek Mining Company, LLC, a subsidiary of The North American Coal Corporation
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Coyote Station
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427-MW coal-fired electric generating facility near Beulah, North Dakota (25 percent ownership)
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Dakota Prairie Refinery
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20,000-barrel-per-day diesel topping plant being built by Dakota Prairie Refining in southwestern North Dakota
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Dakota Prairie Refining
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Dakota Prairie Refining, LLC, a limited liability company jointly owned by WBI Energy and Calumet
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dk
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Decatherm
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Dodd-Frank Act
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Dodd-Frank Wall Street Reform and Consumer Protection Act
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EBITDA
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Earnings before interest, taxes, depreciation and amortization
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ECTE
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Empresa Catarinense de Transmissão de Energia S.A. (2.5 percent ownership interest at December 31, 2013, 2.5, 2.5, 2.5 and 14.99 percent ownership interests were sold in the third quarters of 2013 and 2012 and the fourth quarters of 2011 and 2010, respectively)
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EIN
|
Employer Identification Number
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ENTE
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Empresa Norte de Transmissão de Energia S.A. (entire 13.3 percent ownership interest sold in the fourth quarter of 2010)
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EPA
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U.S. Environmental Protection Agency
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ERISA
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Employee Retirement Income Security Act of 1974
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ERTE
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Empresa Regional de Transmissão de Energia S.A. (entire 13.3 percent ownership interest sold in the fourth quarter of 2010)
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ESA
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Endangered Species Act
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Exchange Act
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Securities Exchange Act of 1934, as amended
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FASB
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Financial Accounting Standards Board
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FERC
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Federal Energy Regulatory Commission
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Fidelity
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Fidelity Exploration & Production Company, a direct wholly owned subsidiary of WBI Holdings
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FIP
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Funding improvement plan
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GAAP
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Accounting principles generally accepted in the United States of America
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GHG
|
Greenhouse gas
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Great Plains
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Great Plains Natural Gas Co., a public utility division of the Company
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GVTC
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Generation Verification Test Capacity
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IBEW
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International Brotherhood of Electrical Workers
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ICWU
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International Chemical Workers Union
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Intermountain
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Intermountain Gas Company, an indirect wholly owned subsidiary of MDU Energy Capital
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IPUC
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Idaho Public Utilities Commission
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Item 8
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Financial Statements and Supplementary Data
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JTL
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JTL Group, Inc., an indirect wholly owned subsidiary of Knife River
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Knife River
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Knife River Corporation, a direct wholly owned subsidiary of Centennial
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Knife River - Northwest
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Knife River Corporation - Northwest, an indirect wholly owned subsidiary of Knife River
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K-Plan
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Company's 401(k) Retirement Plan
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kW
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Kilowatts
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kWh
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Kilowatt-hour
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LPP
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Lea Power Partners, LLC, a former indirect wholly owned subsidiary of Centennial Resources (member interests were sold in October 2006)
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LWG
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Lower Willamette Group
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MBbls
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Thousands of barrels
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MBOE
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Thousands of BOE
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Mcf
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Thousand cubic feet
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MD&A
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Management's Discussion and Analysis of Financial Condition and Results of Operations
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Mdk
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Thousand decatherms
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MDU Brasil
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MDU Brasil Ltda., an indirect wholly owned subsidiary of Centennial Resources
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MDU Construction Services
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MDU Construction Services Group, Inc., a direct wholly owned subsidiary of Centennial
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MDU Energy Capital
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MDU Energy Capital, LLC, a direct wholly owned subsidiary of the Company
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MISO
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Midcontinent Independent System Operator, Inc.
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MMBOE
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Millions of BOE
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MMBtu
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Million Btu
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MMcf
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Million cubic feet
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MMdk
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Million decatherms
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MNPUC
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Minnesota Public Utilities Commission
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Montana-Dakota
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Montana-Dakota Utilities Co., a public utility division of the Company
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Montana DEQ
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Montana Department of Environmental Quality
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Montana First Judicial District Court
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Montana First Judicial District Court, Lewis and Clark County
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Montana Seventeenth Judicial District Court
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Montana Seventeenth Judicial District Court, Phillips County
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MPPAA
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Multiemployer Pension Plan Amendments Act of 1980
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MTPSC
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Montana Public Service Commission
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MW
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Megawatt
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NDPSC
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North Dakota Public Service Commission
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NEPA
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National Environmental Policy Act
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New York Supreme Court
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Supreme Court of the State of New York, County of New York
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NGL
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Natural gas liquids
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NSPS
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New Source Performance Standards
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Oil
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Includes crude oil and condensate
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Omimex
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Omimex Canada, Ltd.
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OPUC
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Oregon Public Utility Commission
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Oregon DEQ
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Oregon State Department of Environmental Quality
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PCBs
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Polychlorinated biphenyls
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PDP
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Proved developed producing
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Prairielands
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Prairielands Energy Marketing, Inc., an indirect wholly owned subsidiary of WBI Holdings
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Proxy Statement
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Company's 2014 Proxy Statement
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PRP
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Potentially Responsible Party
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psi
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Pounds per square inch
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PUD
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Proved undeveloped
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RCRA
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Resource Conservation and Recovery Act
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ROD
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Record of Decision
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RP
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Rehabilitation plan
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Ryder Scott
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Ryder Scott Company, L.P.
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SDPUC
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South Dakota Public Utilities Commission
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SEC
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U.S. Securities and Exchange Commission
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SEC Defined Prices
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The average price of oil and natural gas during the applicable 12-month period, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions
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Securities Act
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Securities Act of 1933, as amended
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Securities Act Industry Guide 7
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Description of Property by Issuers Engaged or to be Engaged in Significant Mining Operations
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Sheridan System
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A separate electric system owned by Montana-Dakota
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SMCRA
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Surface Mining Control and Reclamation Act
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SourceGas
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SourceGas Distribution LLC
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Stock Purchase Plan
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Company's Dividend Reinvestment and Direct Stock Purchase Plan
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UA
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United Association of Journeyman and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada
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VIE
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Variable interest entity
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WBI Energy
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WBI Energy, Inc., an indirect wholly owned subsidiary of WBI Holdings
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WBI Energy Midstream
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WBI Energy Midstream, LLC, an indirect wholly owned subsidiary of WBI Holdings (previously Bitter Creek Pipelines, LLC, name changed effective July 1, 2012)
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WBI Energy Transmission
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WBI Energy Transmission, Inc., an indirect wholly owned subsidiary of WBI Holdings (previously Williston Basin Interstate Pipeline Company, name changed effective July 1, 2012)
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WBI Holdings
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WBI Holdings, Inc., a direct wholly owned subsidiary of Centennial
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Westmoreland
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Westmoreland Coal Company
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WUTC
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Washington Utilities and Transportation Commission
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Wygen III
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100-MW coal-fired electric generating facility near Gillette, Wyoming (25 percent ownership)
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WYPSC
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Wyoming Public Service Commission
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ZRC
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Zonal resource credit - a MW of demand equivalent assigned to generators by MISO for meeting system reliability requirements
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Years ended December 31,
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2013
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2012
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2011
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Average cost of coal per MMBtu
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$
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1.73
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$
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1.69
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$
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1.62
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Average cost of coal per ton
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$
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25.32
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$
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24.77
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$
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23.38
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•
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Bakken areas - Oil targets in which Fidelity holds approximately 16,000 net acres in Mountrail County, North Dakota, approximately 50,000 net acres in Stark County, North Dakota, and approximately 59,000 net acres in Richland County, Montana.
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•
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Cedar Creek Anticline - Primarily in eastern Montana, the Company has a long-held net profits interest in this oil play.
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•
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Paradox Basin - The Company holds approximately 130,000 net acres located in Grand and San Juan Counties, Utah, targeting oil, including its recent acquisition of 35,000 net acres of leaseholds and has an option to earn another 20,000 acres.
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•
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Big Horn Basin - These interests include approximately 21,000 net acres in Wyoming, targeting oil and NGL.
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•
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Green River Basin - These properties were primarily natural gas targets in Wyoming and were sold at the end of 2013.
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•
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Baker Field - Long-held natural gas properties in which Fidelity holds approximately 98,000 net acres in southeastern Montana and southwestern North Dakota.
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•
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Bowdoin Field - Long-held natural gas properties in which Fidelity holds approximately 127,000 net acres in north-central Montana.
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•
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Other - Includes other exploratory oil projects and various non-operated positions.
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•
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South Texas - This area includes approximately 9,000 net acres in the Tabasco, Texan Gardens and Flores fields. This area has significant NGL content associated with the natural gas.
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•
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East Texas - Fidelity holds approximately 9,000 net acres, primarily natural gas and associated NGL.
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•
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Other - Includes various non-operated onshore interests, as well as offshore interests in the shallow waters off the coasts of Texas and Louisiana.
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Net Exploratory
|
Net Development
|
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|||||||||||
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Productive
|
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Dry Holes
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Total
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Productive
|
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Dry Holes
|
|
Total
|
|
Total
|
|
2013
|
3
|
|
2
|
|
5
|
|
35
|
|
3
|
|
38
|
|
43
|
|
2012
|
24
|
|
3
|
|
27
|
|
39
|
|
1
|
|
40
|
|
67
|
|
2011
|
4
|
|
—
|
|
4
|
|
48
|
|
—
|
|
48
|
|
52
|
|
|
Number of Sites
(Crushed Stone)
|
Number of Sites
(Sand & Gravel)
|
Tons Sold (000's)
|
Estimated Reserves (000's tons)
|
|
Lease Expiration
|
|
Reserve
Life (years)
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|
|||||||||||
Production Area
|
owned
|
|
leased
|
|
owned
|
|
leased
|
|
2013
|
|
2012
|
|
2011
|
|
||||||
Anchorage, AK
|
—
|
|
—
|
|
1
|
|
—
|
|
1,074
|
|
110
|
|
137
|
|
18,880
|
|
N/A
|
|
43
|
|
Hawaii
|
—
|
|
6
|
|
—
|
|
—
|
|
1,672
|
|
1,678
|
|
1,527
|
|
57,333
|
|
2017-2064
|
|
35
|
|
Northern CA
|
—
|
|
—
|
|
9
|
|
1
|
|
1,525
|
|
1,203
|
|
1,552
|
|
45,570
|
|
2018
|
|
32
|
|
Southern CA
|
—
|
|
2
|
|
—
|
|
—
|
|
241
|
|
784
|
|
1,134
|
|
92,110
|
|
2035
|
|
Over 100
|
|
Portland, OR
|
1
|
|
3
|
|
5
|
|
3
|
|
3,343
|
|
2,698
|
|
3,106
|
|
231,734
|
|
2014-2055
|
|
76
|
|
Eugene, OR
|
3
|
|
4
|
|
4
|
|
1
|
|
825
|
|
847
|
|
884
|
|
168,392
|
|
2016-2046
|
|
Over 100
|
|
Central OR/WA/ID
|
1
|
|
2
|
|
5
|
|
4
|
|
1,045
|
|
1,131
|
|
851
|
|
123,613
|
|
2015-2077
|
|
Over 100
|
|
Southwest OR
|
5
|
|
4
|
|
11
|
|
5
|
|
1,465
|
|
1,613
|
|
1,604
|
|
96,768
|
|
2014-2053
|
|
62
|
|
Central MT
|
—
|
|
—
|
|
1
|
|
2
|
|
1,236
|
|
1,200
|
|
758
|
|
28,213
|
|
2017-2027
|
|
26
|
|
Northwest MT
|
—
|
|
—
|
|
7
|
|
2
|
|
1,242
|
|
1,011
|
|
1,370
|
|
65,993
|
|
2016-2020
|
|
55
|
|
Wyoming
|
—
|
|
—
|
|
1
|
|
1
|
|
983
|
|
428
|
|
461
|
|
11,571
|
|
2019
|
|
19
|
|
Central MN
|
—
|
|
1
|
|
37
|
|
24
|
|
1,578
|
|
1,714
|
|
1,520
|
|
73,429
|
|
2014-2028
|
|
46
|
|
Northern MN
|
2
|
|
—
|
|
16
|
|
5
|
|
349
|
|
195
|
|
355
|
|
26,782
|
|
2015-2017
|
|
89
|
|
ND/SD
|
—
|
|
—
|
|
3
|
|
19
|
|
1,862
|
|
1,711
|
|
1,727
|
|
30,899
|
|
2014-2031
|
|
17
|
|
Iowa
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
305
|
|
249
|
|
—
|
|
—
|
|
—
|
|
Texas
|
1
|
|
1
|
|
1
|
|
—
|
|
672
|
|
692
|
|
1,182
|
|
12,089
|
|
2022
|
|
14
|
|
Sales from other sources
|
|
|
|
|
5,601
|
|
5,965
|
|
6,319
|
|
|
|
|
|||||||
|
|
|
|
|
24,713
|
|
23,285
|
|
24,736
|
|
1,083,376
|
|
|
|
•
|
A severe prolonged economic downturn
|
•
|
The bankruptcy of unrelated industry leaders in the same line of business
|
•
|
Deterioration in capital market conditions
|
•
|
Turmoil in the financial services industry
|
•
|
Volatility in commodity prices
|
•
|
Terrorist attacks
|
•
|
Cyber attacks
|
•
|
Acquisition, disposal and impairments of assets or facilities
|
•
|
Changes in operation, performance and construction of plant facilities or other assets
|
•
|
Changes in present or prospective generation
|
•
|
The ability to obtain adequate and timely cost recovery for the Company's regulated operations through regulatory proceedings
|
•
|
The availability of economic expansion or development opportunities
|
•
|
Population growth rates and demographic patterns
|
•
|
Market demand for, available supplies of, and/or costs of, energy- and construction-related products and services
|
•
|
The cyclical nature of large construction projects at certain operations
|
•
|
Changes in tax rates or policies
|
•
|
Unanticipated project delays or changes in project costs, including related energy costs
|
•
|
Unanticipated changes in operating expenses or capital expenditures
|
•
|
Labor negotiations or disputes
|
•
|
Inability of the various contract counterparties to meet their contractual obligations
|
•
|
Changes in accounting principles and/or the application of such principles to the Company
|
•
|
Changes in technology
|
•
|
Changes in legal or regulatory proceedings
|
•
|
The ability to effectively integrate the operations and the internal controls of acquired companies
|
•
|
The ability to attract and retain skilled labor and key personnel
|
•
|
Increases in employee and retiree benefit costs and funding requirements
|
Item 5.
|
Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
|
|
Common Stock Price (High)
|
|
Common Stock Price (Low)
|
|
Common Stock Dividends Declared
Per Share
|
|
|||
2013
|
|
|
|
||||||
First quarter
|
|
$25.00
|
|
|
$21.50
|
|
|
$.1725
|
|
Second quarter
|
27.14
|
|
23.37
|
|
.1725
|
|
|||
Third quarter
|
30.21
|
|
25.94
|
|
.1725
|
|
|||
Fourth quarter
|
30.97
|
|
27.53
|
|
.1775
|
|
|||
|
|
|
|
$.6950
|
|
||||
2012
|
|
|
|
||||||
First quarter
|
|
$22.50
|
|
|
$21.14
|
|
|
$.1675
|
|
Second quarter
|
23.21
|
|
20.76
|
|
.1675
|
|
|||
Third quarter
|
23.11
|
|
21.42
|
|
.1675
|
|
|||
Fourth quarter
|
22.23
|
|
19.59
|
|
.1725
|
|
|||
|
|
|
|
$.6750
|
|
Period
|
(a)
Total Number
of Shares
(or Units)
Purchased (1)
|
|
(b)
Average Price Paid per Share
(or Unit)
|
|
(c)
Total Number of Shares
(or Units) Purchased
as Part of Publicly
Announced Plans
or Programs (2)
|
(d)
Maximum Number (or
Approximate Dollar
Value) of Shares (or
Units) that May Yet Be
Purchased Under the
Plans or Programs (2)
|
|
October 1 through October 31, 2013
|
—
|
|
|
|
|
||
November 1 through November 30, 2013
|
33,027
|
|
|
$30.53
|
|
|
|
December 1 through December 31, 2013
|
3,686
|
|
29.83
|
|
|
|
|
Total
|
36,713
|
|
|
|
|
|
|
(1) Represents shares of common stock purchased on the open market in connection with annual stock grants made to the Company's non-employee directors and for those directors who elected to receive additional shares of common stock in lieu of a portion of their cash retainer.
(2) Not applicable. The Company does not currently have in place any publicly announced plans or programs to purchase equity securities.
|
|
2013
|
|
2012
|
|
(a)
|
2011
|
|
2010
|
|
2009
|
|
(b)
|
2008
|
|
(c)
|
||||||
Selected Financial Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating revenues (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Electric
|
$
|
257,260
|
|
$
|
236,895
|
|
|
$
|
225,468
|
|
$
|
211,544
|
|
$
|
196,171
|
|
|
$
|
208,326
|
|
|
Natural gas distribution
|
851,945
|
|
754,848
|
|
|
907,400
|
|
892,708
|
|
1,072,776
|
|
|
1,036,109
|
|
|
||||||
Pipeline and energy services
|
202,068
|
|
193,157
|
|
|
278,343
|
|
329,809
|
|
307,827
|
|
|
532,153
|
|
|
||||||
Exploration and production
|
536,023
|
|
448,617
|
|
|
453,586
|
|
434,354
|
|
439,655
|
|
|
712,279
|
|
|
||||||
Construction materials and contracting
|
1,712,137
|
|
1,617,425
|
|
|
1,510,010
|
|
1,445,148
|
|
1,515,122
|
|
|
1,640,683
|
|
|
||||||
Construction services
|
1,039,839
|
|
938,558
|
|
|
854,389
|
|
789,100
|
|
819,064
|
|
|
1,257,319
|
|
|
||||||
Other
|
9,620
|
|
10,370
|
|
|
11,446
|
|
7,727
|
|
9,487
|
|
|
10,501
|
|
|
||||||
Intersegment eliminations
|
(146,488
|
)
|
(124,439
|
)
|
|
(190,150
|
)
|
(200,695
|
)
|
(183,601
|
)
|
|
(394,092
|
)
|
|
||||||
|
$
|
4,462,404
|
|
$
|
4,075,431
|
|
|
$
|
4,050,492
|
|
$
|
3,909,695
|
|
$
|
4,176,501
|
|
|
$
|
5,003,278
|
|
|
Operating income (loss) (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Electric
|
$
|
54,274
|
|
$
|
49,852
|
|
|
$
|
49,096
|
|
$
|
48,296
|
|
$
|
36,709
|
|
|
$
|
35,415
|
|
|
Natural gas distribution
|
78,829
|
|
67,579
|
|
|
82,856
|
|
75,697
|
|
76,899
|
|
|
76,887
|
|
|
||||||
Pipeline and energy services
|
20,046
|
|
49,139
|
|
|
45,365
|
|
46,310
|
|
69,388
|
|
|
49,560
|
|
|
||||||
Exploration and production
|
161,402
|
|
(276,642
|
)
|
|
133,790
|
|
143,169
|
|
(473,399
|
)
|
|
202,954
|
|
|
||||||
Construction materials and contracting
|
93,629
|
|
57,864
|
|
|
51,092
|
|
63,045
|
|
93,270
|
|
|
62,849
|
|
|
||||||
Construction services
|
85,246
|
|
66,531
|
|
|
39,144
|
|
33,352
|
|
44,255
|
|
|
81,485
|
|
|
||||||
Other
|
6,649
|
|
4,884
|
|
|
5,024
|
|
858
|
|
(219
|
)
|
|
2,887
|
|
|
||||||
Intersegment eliminations
|
(7,176
|
)
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
||||||
|
$
|
492,899
|
|
$
|
19,207
|
|
|
$
|
406,367
|
|
$
|
410,727
|
|
$
|
(153,097
|
)
|
|
$
|
512,037
|
|
|
Earnings (loss) on common stock (000's):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Electric
|
$
|
34,837
|
|
$
|
30,634
|
|
|
$
|
29,258
|
|
$
|
28,908
|
|
$
|
24,099
|
|
|
$
|
18,755
|
|
|
Natural gas distribution
|
37,656
|
|
29,409
|
|
|
38,398
|
|
36,944
|
|
30,796
|
|
|
34,774
|
|
|
||||||
Pipeline and energy services
|
7,629
|
|
26,588
|
|
|
23,082
|
|
23,208
|
|
37,845
|
|
|
26,367
|
|
|
||||||
Exploration and production
|
94,450
|
|
(177,283
|
)
|
|
80,282
|
|
85,638
|
|
(296,730
|
)
|
|
122,326
|
|
|
||||||
Construction materials and contracting
|
50,946
|
|
32,420
|
|
|
26,430
|
|
29,609
|
|
47,085
|
|
|
30,172
|
|
|
||||||
Construction services
|
52,213
|
|
38,429
|
|
|
21,627
|
|
17,982
|
|
25,589
|
|
|
49,782
|
|
|
||||||
Other
|
5,136
|
|
4,797
|
|
|
6,190
|
|
21,046
|
|
7,357
|
|
|
10,812
|
|
|
||||||
Intersegment eliminations
|
(4,307
|
)
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
||||||
Earnings (loss) on common stock before income (loss) from discontinued operations
|
278,560
|
|
(15,006
|
)
|
|
225,267
|
|
243,335
|
|
(123,959
|
)
|
|
292,988
|
|
|
||||||
Income (loss) from discontinued operations, net of tax
|
(312
|
)
|
13,567
|
|
|
(12,926
|
)
|
(3,361
|
)
|
—
|
|
|
—
|
|
|
||||||
|
$
|
278,248
|
|
$
|
(1,439
|
)
|
|
$
|
212,341
|
|
$
|
239,974
|
|
$
|
(123,959
|
)
|
|
$
|
292,988
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings (loss) per common share before discontinued operations - diluted
|
$
|
1.47
|
|
$
|
(.08
|
)
|
|
$
|
1.19
|
|
$
|
1.29
|
|
$
|
(.67
|
)
|
|
$
|
1.59
|
|
|
Discontinued operations, net of tax
|
—
|
|
.07
|
|
|
(.07
|
)
|
(.02
|
)
|
—
|
|
|
—
|
|
|
||||||
|
$
|
1.47
|
|
$
|
(.01
|
)
|
|
$
|
1.12
|
|
$
|
1.27
|
|
$
|
(.67
|
)
|
|
$
|
1.59
|
|
|
|
2013
|
|
2012
|
|
(a)
|
2011
|
|
2010
|
|
2009
|
|
(b)
|
2008
|
|
(c)
|
||||||
Common Stock Statistics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding - diluted (000's)
|
189,693
|
|
188,826
|
|
|
188,905
|
|
188,229
|
|
185,175
|
|
|
183,807
|
|
|
||||||
Dividends declared per common share
|
$
|
.6950
|
|
$
|
.6750
|
|
|
$
|
.6550
|
|
$
|
.6350
|
|
$
|
.6225
|
|
|
$
|
.6000
|
|
|
Book value per common share
|
$
|
15.01
|
|
$
|
13.95
|
|
|
$
|
14.62
|
|
$
|
14.22
|
|
$
|
13.61
|
|
|
$
|
14.95
|
|
|
Market price per common share (year end)
|
$
|
30.55
|
|
$
|
21.24
|
|
|
$
|
21.46
|
|
$
|
20.27
|
|
$
|
23.60
|
|
|
$
|
21.58
|
|
|
Market price ratios:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Dividend payout
|
47
|
%
|
(d)
|
|
|
58
|
%
|
50
|
%
|
(d)
|
|
|
38
|
%
|
|
||||||
Yield
|
2.3
|
%
|
3.2
|
%
|
|
3.1
|
%
|
3.2
|
%
|
2.7
|
%
|
|
2.9
|
%
|
|
||||||
Market value as a percent of book value
|
203.5
|
%
|
152.3
|
%
|
|
146.8
|
%
|
142.5
|
%
|
173.4
|
%
|
|
144.3
|
%
|
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
||||||
General
|
|
|
|
|
|
|
||||||||||||
Total assets (000's)
|
$
|
7,061,332
|
|
$
|
6,682,491
|
|
$
|
6,556,125
|
|
$
|
6,303,549
|
|
$
|
5,990,952
|
|
$
|
6,587,845
|
|
Total long-term debt (000's)
|
$
|
1,854,563
|
|
$
|
1,744,975
|
|
$
|
1,424,678
|
|
$
|
1,506,752
|
|
$
|
1,499,306
|
|
$
|
1,647,302
|
|
Capitalization ratios:
|
|
|
|
|
|
|
|
|
|
|
||||||||
Common equity
|
60
|
%
|
60
|
%
|
66
|
%
|
64
|
%
|
63
|
%
|
61
|
%
|
||||||
Total debt
|
40
|
|
40
|
|
34
|
|
36
|
|
37
|
|
39
|
|
||||||
|
100
|
%
|
100
|
%
|
100
|
%
|
100
|
%
|
100
|
%
|
100
|
%
|
||||||
Electric
|
|
|
|
|
|
|
||||||||||||
Retail sales (thousand kWh)
|
3,173,086
|
|
2,996,528
|
|
2,878,852
|
|
2,785,710
|
|
2,663,560
|
|
2,663,452
|
|
||||||
Electric system summer and firm purchase contract ZRCs (Interconnected system)
|
583.5
|
|
552.8
|
|
572.8
|
|
553.3
|
|
(a)
|
|
(a)
|
|
||||||
Electric system peak demand obligation, including firm purchase contracts, ZRCs (Interconnected system)
|
508.3
|
|
550.7
|
|
524.2
|
|
529.5
|
|
(a)
|
|
(a)
|
|
||||||
Demand peak - kW (Interconnected system)
|
573,587
|
|
573,587
|
|
535,761
|
|
525,643
|
|
525,643
|
|
525,643
|
|
||||||
Electricity produced (thousand kWh)
|
2,430,001
|
|
2,299,686
|
|
2,488,337
|
|
2,472,288
|
|
2,203,665
|
|
2,538,439
|
|
||||||
Electricity purchased (thousand kWh)
|
971,261
|
|
870,516
|
|
645,567
|
|
521,156
|
|
682,152
|
|
516,654
|
|
||||||
Average cost of fuel and purchased power per kWh
|
$
|
.025
|
|
$
|
.023
|
|
$
|
.021
|
|
$
|
.021
|
|
$
|
.023
|
|
$
|
.025
|
|
Natural Gas Distribution (b)
|
|
|
|
|
|
|
|
|
|
|||||||||
Sales (Mdk)
|
108,260
|
|
93,810
|
|
103,237
|
|
95,480
|
|
102,670
|
|
87,924
|
|
||||||
Transportation (Mdk)
|
149,490
|
|
132,010
|
|
124,227
|
|
135,823
|
|
132,689
|
|
103,504
|
|
||||||
Degree days (% of normal)
|
|
|
|
|
|
|
|
|
|
|||||||||
Montana-Dakota/Great Plains
|
105
|
%
|
84
|
%
|
101
|
%
|
98
|
%
|
104
|
%
|
103
|
%
|
||||||
Cascade
|
98
|
%
|
96
|
%
|
103
|
%
|
96
|
%
|
105
|
%
|
108
|
%
|
||||||
Intermountain
|
110
|
%
|
91
|
%
|
107
|
%
|
100
|
%
|
107
|
%
|
90
|
%
|
||||||
Pipeline and Energy Services
|
|
|
|
|
|
|
|
|
|
|||||||||
Transportation (Mdk)
|
178,598
|
|
137,720
|
|
113,217
|
|
140,528
|
|
163,283
|
|
138,003
|
|
||||||
Gathering (Mdk)
|
40,737
|
|
47,084
|
|
66,500
|
|
77,154
|
|
92,598
|
|
102,064
|
|
||||||
Customer natural gas storage balance (Mdk)
|
26,693
|
|
43,731
|
|
36,021
|
|
58,784
|
|
61,506
|
|
30,598
|
|
||||||
Exploration and Production
|
|
|
|
|
|
|
|
|
|
|||||||||
Production:
|
|
|
|
|
|
|
|
|
|
|||||||||
Oil (MBbls)
|
4,815
|
|
3,694
|
|
2,724
|
|
2,767
|
|
2,557
|
|
2,232
|
|
||||||
NGL (MBbls)
|
781
|
|
828
|
|
776
|
|
495
|
|
554
|
|
576
|
|
||||||
Natural gas (MMcf)
|
28,008
|
|
33,214
|
|
45,598
|
|
50,391
|
|
56,632
|
|
65,457
|
|
||||||
Total production (MBOE)
|
10,264
|
|
10,058
|
|
11,099
|
|
11,661
|
|
12,550
|
|
13,717
|
|
||||||
Average realized prices (excluding realized and unrealized gain/loss on commodity derivatives):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Oil (per Bbl)
|
$
|
89.70
|
|
$
|
84.84
|
|
$
|
91.62
|
|
$
|
70.61
|
|
$
|
53.57
|
|
$
|
89.41
|
|
NGL (per Bbl)
|
$
|
37.39
|
|
$
|
39.81
|
|
$
|
54.06
|
|
$
|
44.93
|
|
$
|
32.18
|
|
$
|
54.65
|
|
Natural gas (per Mcf)
|
$
|
2.89
|
|
$
|
2.08
|
|
$
|
3.30
|
|
$
|
3.57
|
|
$
|
2.99
|
|
$
|
7.29
|
|
Average realized prices (including realized gain/loss on commodity derivatives):
|
|
|
|
|
|
|
|
|
|
|
||||||||
Oil (per Bbl)
|
$
|
89.35
|
|
$
|
86.54
|
|
$
|
86.20
|
|
$
|
69.59
|
|
$
|
50.67
|
|
$
|
88.66
|
|
NGL (per Bbl)
|
$
|
37.39
|
|
$
|
39.81
|
|
$
|
54.06
|
|
$
|
44.93
|
|
$
|
32.18
|
|
$
|
54.65
|
|
Natural gas (per Mcf)
|
$
|
2.96
|
|
$
|
2.91
|
|
$
|
3.84
|
|
$
|
4.36
|
|
$
|
5.16
|
|
$
|
7.38
|
|
Proved reserves:
|
|
|
|
|
|
|
|
|
|
|||||||||
Oil (MBbls)
|
41,019
|
|
33,453
|
|
27,005
|
|
25,666
|
|
25,930
|
|
25,238
|
|
||||||
NGL (MBbls)
|
6,602
|
|
7,153
|
|
7,342
|
|
7,201
|
|
8,286
|
|
9,110
|
|
||||||
Natural gas (MMcf)
|
198,445
|
|
239,278
|
|
379,827
|
|
448,397
|
|
448,425
|
|
604,282
|
|
||||||
Total proved reserves (MBOE)
|
80,695
|
|
80,486
|
|
97,651
|
|
107,599
|
|
108,954
|
|
135,062
|
|
Item 7.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
Organic growth as well as a continued disciplined approach to the acquisition of well-managed companies and properties
|
•
|
The elimination of system-wide cost redundancies through increased focus on integration of operations and standardization and consolidation of various support services and functions across companies within the organization
|
•
|
The development of projects that are accretive to earnings per share and return on invested capital
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(Dollars in millions, where applicable)
|
||||||||
Electric
|
$
|
34.8
|
|
$
|
30.6
|
|
$
|
29.2
|
|
Natural gas distribution
|
37.7
|
|
29.4
|
|
38.4
|
|
|||
Pipeline and energy services
|
7.6
|
|
26.6
|
|
23.1
|
|
|||
Exploration and production
|
94.5
|
|
(177.2
|
)
|
80.3
|
|
|||
Construction materials and contracting
|
50.9
|
|
32.4
|
|
26.4
|
|
|||
Construction services
|
52.2
|
|
38.4
|
|
21.6
|
|
|||
Other
|
5.1
|
|
4.8
|
|
6.2
|
|
|||
Intersegment eliminations
|
(4.3
|
)
|
—
|
|
—
|
|
|||
Earnings (loss) before discontinued operations
|
278.5
|
|
(15.0
|
)
|
225.2
|
|
|||
Income (loss) from discontinued operations, net of tax
|
(.3
|
)
|
13.6
|
|
(12.9
|
)
|
|||
Earnings (loss) on common stock
|
$
|
278.2
|
|
$
|
(1.4
|
)
|
$
|
212.3
|
|
Earnings (loss) per common share - basic:
|
|
|
|
|
|
|
|||
Earnings (loss) before discontinued operations
|
$
|
1.47
|
|
$
|
(.08
|
)
|
$
|
1.19
|
|
Discontinued operations, net of tax
|
—
|
|
.07
|
|
(.07
|
)
|
|||
Earnings (loss) per common share - basic
|
$
|
1.47
|
|
$
|
(.01
|
)
|
$
|
1.12
|
|
Earnings (loss) per common share - diluted:
|
|
|
|
|
|
|
|||
Earnings (loss) before discontinued operations
|
$
|
1.47
|
|
$
|
(.08
|
)
|
$
|
1.19
|
|
Discontinued operations, net of tax
|
—
|
|
.07
|
|
(.07
|
)
|
|||
Earnings (loss) per common share - diluted
|
$
|
1.47
|
|
$
|
(.01
|
)
|
$
|
1.12
|
|
•
|
Absence of the write-downs of oil and natural gas properties of $246.8 million (after tax), as discussed in Item 8 - Note 1, increased oil production and higher average realized natural gas and oil prices, partially offset by a lower realized gain on commodity derivatives of $21.1 million (after tax), higher depreciation, depletion and amortization expense, decreased natural gas production, higher production taxes, as well as higher general and administrative expense at the exploration and production business
|
•
|
Higher asphalt and aggregate margins and volumes at the construction materials and contracting business
|
•
|
Higher workloads and margins in the Western and Central regions, as well as higher equipment sales and rental revenue and margins at the construction services business
|
•
|
Increased retail sales volumes and a gain on the sale of a nonregulated appliance service and repair business, partially offset by higher operation and maintenance expense, as well as higher depreciation, depletion and amortization expense at the natural gas distribution business
|
•
|
A net benefit in 2013 of $1.5 million (after tax) compared to $15.0 million (after tax) in 2012, related to the natural gas gathering operations litigation, as discussed in Item 8 - Note 19,
as well as an impairment of coalbed natural gas gathering assets of $9.0 million (after tax) in 2013 compared to an impairment of $1.7 million (after tax) in 2012, as discussed in Item 8 - Note 1, at the pipeline and energy services business
|
•
|
Loss from discontinued operations of $300,000 (after tax) in 2013, compared to income from discontinued operations of $13.6 million (after tax) in 2012, primarily due to the absence in 2013 of a net benefit in 2012 related to the reversal of an arbitration charge resulting from a favorable court ruling, as discussed in Item 8 - Note 3
|
•
|
Noncash write-downs of oil and natural gas properties of $246.8 million (after tax), lower average realized natural gas prices, decreased natural gas production, as well as higher depreciation, depletion and amortization expense, partially offset by increased oil production at the exploration and production business
|
•
|
Decreased retail sales volumes at the natural gas distribution business, largely resulting from warmer weather than last year
|
•
|
Income from discontinued operations of $13.6 million (after tax), largely related to a benefit from an arbitration charge reversal resulting from a favorable court ruling, as discussed in Item 8 - Note 3
|
•
|
Higher workloads and margins in the Central and Western regions, higher equipment sales and rental margins, as well as higher margins in the Mountain region, partially offset by higher general and administrative expense at the construction services business
|
•
|
Higher ready-mixed concrete and other product line margins and volumes, increased construction margins, as well as higher liquid asphalt oil margins and volumes, partially offset by lower gains from the sale of property, plant and equipment and lower aggregate and asphalt margins and volumes at the construction materials and contracting business
|
•
|
Lower operation and maintenance expense from existing operations largely related to a $15.0 million (after tax) net benefit related to the natural gas gathering operations litigation, as discussed in Item 8 - Note 19, partially offset by lower natural gas gathering volumes from existing operations at the pipeline and energy services business
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(Dollars in millions, where applicable)
|
||||||||
Operating revenues
|
$
|
257.3
|
|
$
|
236.9
|
|
$
|
225.5
|
|
Operating expenses:
|
|
|
|
|
|||||
Fuel and purchased power
|
83.5
|
|
72.4
|
|
64.5
|
|
|||
Operation and maintenance
|
76.5
|
|
71.8
|
|
70.3
|
|
|||
Depreciation, depletion and amortization
|
32.8
|
|
32.5
|
|
32.2
|
|
|||
Taxes, other than income
|
10.2
|
|
10.3
|
|
9.4
|
|
|||
|
203.0
|
|
187.0
|
|
176.4
|
|
|||
Operating income
|
54.3
|
|
49.9
|
|
49.1
|
|
|||
Earnings
|
$
|
34.8
|
|
$
|
30.6
|
|
$
|
29.2
|
|
Retail sales (million kWh)
|
3,173.1
|
|
2,996.5
|
|
2,878.9
|
|
|||
Average cost of fuel and purchased power per kWh
|
$
|
.025
|
|
$
|
.023
|
|
$
|
.021
|
|
•
|
Higher electric retail sales margins, including the result of 6 percent higher volumes, primarily to residential, commercial and industrial customers due to increased residential customer growth and weather variances from last year
|
•
|
Higher other income, largely higher allowance for funds used during construction of $800,000 (after tax)
|
•
|
Higher retail sales volumes of 4 percent, primarily to small commercial and industrial and residential customers, reflecting increased demand due to warmer summer weather than last year, as well as increased customer growth, offset in part by decreased volumes to large commercial and industrial customers
|
•
|
Higher other income, largely higher allowance for funds used during construction of $900,000 (after tax)
|
•
|
Lower net interest expense, which includes $900,000 (after tax) due in part to higher capitalized interest
|
•
|
Higher income taxes, including $1.4 million which is partially related to the absence of an income tax benefit related to favorable resolutions of certain income tax matters in 2011
|
•
|
Increased taxes other than income of $600,000 (after tax), primarily related to higher property taxes
|
•
|
Higher operation and maintenance expense, which includes $500,000 (after tax) largely related to increased contract services at certain of the Company's electric generation stations, as well as higher payroll-related costs, partially offset by lower benefit-related costs
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(Dollars in millions, where applicable)
|
||||||||
Operating revenues
|
$
|
851.9
|
|
$
|
754.8
|
|
$
|
907.4
|
|
Operating expenses:
|
|
|
|
|
|||||
Purchased natural gas sold
|
534.8
|
|
457.4
|
|
594.6
|
|
|||
Operation and maintenance
|
142.3
|
|
139.4
|
|
137.3
|
|
|||
Depreciation, depletion and amortization
|
50.0
|
|
45.7
|
|
44.6
|
|
|||
Taxes, other than income
|
46.0
|
|
44.7
|
|
48.0
|
|
|||
|
773.1
|
|
687.2
|
|
824.5
|
|
|||
Operating income
|
78.8
|
|
67.6
|
|
82.9
|
|
|||
Earnings
|
$
|
37.7
|
|
$
|
29.4
|
|
$
|
38.4
|
|
Volumes (MMdk):
|
|
|
|
|
|||||
Sales
|
108.3
|
|
93.8
|
|
103.3
|
|
|||
Transportation
|
149.5
|
|
132.0
|
|
124.2
|
|
|||
Total throughput
|
257.8
|
|
225.8
|
|
227.5
|
|
|||
Degree days (% of normal)*
|
|
|
|
|
|
|
|||
Montana-Dakota/Great Plains
|
105
|
%
|
84
|
%
|
101
|
%
|
|||
Cascade
|
98
|
%
|
96
|
%
|
103
|
%
|
|||
Intermountain
|
110
|
%
|
91
|
%
|
107
|
%
|
|||
Average cost of natural gas, including transportation, per dk
|
$
|
4.94
|
|
$
|
4.88
|
|
$
|
5.76
|
|
* Degree days are a measure of the daily temperature-related demand for energy for heating.
|
•
|
Increased retail sales volumes of 15 percent, largely resulting from increased customer growth and colder weather than last year, partially offset by weather normalization adjustments in certain jurisdictions
|
•
|
A $2.8 million (after tax) gain on the sale of Montana-Dakota's nonregulated appliance service and repair business
|
•
|
Lower net interest expense, which includes $2.3 million (after tax) largely related to lower average interest rates
|
•
|
Higher operation and maintenance expense, which includes $3.4 million (after tax) largely related to higher payroll-related costs, offset in part by lower benefit-related costs
|
•
|
Increased depreciation, depletion and amortization expense of $2.7 million (after tax), primarily resulting from higher property, plant and equipment balances
|
•
|
Lower other income, which includes $2.0 million (after tax) largely related to lower allowance for funds used during construction
|
•
|
Lower earnings of $7.6 million (after tax) related to decreased retail sales volumes, largely resulting from warmer weather than last year, partially offset by weather normalization in certain jurisdictions
|
•
|
Taxes other than income includes $1.3 million (after tax) primarily related to higher property taxes. Taxes other than income also reflects the effect of lower natural gas revenues.
|
•
|
Absence in 2012 of a reduction of deferred income taxes, which includes $1.2 million primarily associated with benefits in 2011
|
•
|
Increased operation and maintenance expense, which includes $700,000 (after tax) partially related to increased contract services
|
Years ended December 31,
|
2013
|
|
|
2012
|
|
|
2011
|
|
|
|||
|
(Dollars in millions)
|
|
||||||||||
Operating revenues
|
$
|
202.1
|
|
|
$
|
193.1
|
|
|
$
|
278.3
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|||||
Purchased natural gas sold
|
57.5
|
|
|
50.5
|
|
|
125.3
|
|
|
|||
Operation and maintenance*
|
81.8
|
|
|
52.2
|
|
|
68.9
|
|
|
|||
Depreciation, depletion and amortization
|
29.1
|
|
|
27.7
|
|
|
25.5
|
|
|
|||
Taxes, other than income
|
13.6
|
|
|
13.6
|
|
|
13.2
|
|
|
|||
|
182.0
|
|
|
144.0
|
|
|
232.9
|
|
|
|||
Operating income
|
20.1
|
|
|
49.1
|
|
|
45.4
|
|
|
|||
Earnings*
|
$
|
7.6
|
|
|
$
|
26.6
|
|
|
$
|
23.1
|
|
|
Transportation volumes (MMdk)
|
178.6
|
|
|
137.7
|
|
|
113.2
|
|
|
|||
Natural gas gathering volumes (MMdk)
|
40.7
|
|
|
47.1
|
|
|
66.5
|
|
|
|||
Customer natural gas storage balance (MMdk):
|
|
|
|
|
|
|
|
|||||
Beginning of period
|
43.7
|
|
|
36.0
|
|
|
58.8
|
|
|
|||
Net injection (withdrawal)
|
(17.0
|
)
|
|
7.7
|
|
|
(22.8
|
)
|
|
|||
End of period
|
26.7
|
|
|
43.7
|
|
|
36.0
|
|
|
|||
* Reflects an impairment of coalbed natural gas gathering assets of $14.5 million ($9.0 million after tax) in second quarter 2013 and $2.7 million ($1.7 million after tax) in second quarter 2012, as well as a net benefit of $2.5 million ($1.5 million after tax) in fourth quarter 2013 and $24.1 million ($15.0 million after tax) in second quarter 2012 related to the natural gas gathering operations litigation, largely reflected in operation and maintenance expense, as discussed in Item 8 - Note 19.
|
|
•
|
A net benefit in 2013 of $1.5 million (after tax) compared to $15.0 million (after tax) in 2012, related to the natural gas gathering operations litigation, as discussed in Item 8 - Note 19
|
•
|
An impairment of coalbed natural gas gathering assets of $9.0 million (after tax) in 2013, compared to an impairment of $1.7 million (after tax) in 2012, largely resulting from lower natural gas prices, as discussed in Item 8 - Note 1
|
•
|
Lower storage services revenue of $3.1 million (after tax), primarily due to lower average rates and lower storage balances
|
•
|
Lower earnings of $3.1 million (after tax) resulting from lower natural gas gathering volumes from existing operations, largely resulting from customers experiencing production curtailments, normal declines and deferral of natural gas development activity
|
•
|
Higher earnings from the Company's interest in the Pronghorn oil and natural gas gathering and processing assets, which were acquired in May 2012, primarily due to higher volumes
|
•
|
Lower operation and maintenance expense (excluding the asset impairments, net benefits related to the natural gas gathering operations litigation and Pronghorn-related expense), which includes $2.0 million (after tax), largely related to lower payroll-related costs, legal and contract services
|
•
|
Lower depreciation, depletion and amortization expense (excluding depreciation on Pronghorn oil and natural gas gathering and processing assets), which includes $1.6 million (after tax), primarily related to the coalbed areas
|
•
|
Lower operation and maintenance expense from existing operations largely related to a $15.0 million (after tax) net benefit related to the natural gas gathering operations litigation, as discussed in Item 8 - Note 19, which was partially offset by an impairment of certain natural gas gathering assets of $1.7 million (after tax) due largely to low natural gas prices
|
•
|
Higher oil and natural gas gathering and processing volumes from the acquisition of the Company's interest in the Pronghorn oil and natural gas gathering and processing assets, as discussed in Item 8 - Note 2
|
•
|
Lower earnings of $10.4 million (after tax) due to lower natural gas gathering volumes from existing operations, largely resulting from customers experiencing normal declines, production curtailments, deferral of certain natural gas development activity and the Company's divestments
|
•
|
Lower storage services revenue of $600,000 (after tax), largely lower average storage balances, as well as lower withdrawal volumes
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(Dollars in millions, where applicable)
|
||||||||
Operating revenues:
|
|
|
|
||||||
Oil
|
$
|
431.9
|
|
$
|
313.4
|
|
$
|
249.6
|
|
NGL
|
29.2
|
|
33.0
|
|
41.9
|
|
|||
Natural gas
|
81.0
|
|
69.2
|
|
150.7
|
|
|||
Realized gain on commodity derivatives
|
.2
|
|
33.6
|
|
9.6
|
|
|||
Unrealized gain (loss) on commodity derivatives
|
(6.3
|
)
|
(.6
|
)
|
1.8
|
|
|||
|
536.0
|
|
448.6
|
|
453.6
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||
Operation and maintenance:
|
|
|
|
|
|
||||
Lease operating costs
|
82.2
|
|
77.7
|
|
75.6
|
|
|||
Gathering and transportation
|
15.4
|
|
17.4
|
|
24.3
|
|
|||
Other
|
42.9
|
|
37.0
|
|
36.5
|
|
|||
Depreciation, depletion and amortization
|
186.4
|
|
160.7
|
|
142.6
|
|
|||
Taxes, other than income:
|
|
|
|
|
|||||
Production and property taxes
|
46.6
|
|
39.7
|
|
40.8
|
|
|||
Other
|
1.1
|
|
1.0
|
|
—
|
|
|||
Write-downs of oil and natural gas properties
|
—
|
|
391.8
|
|
—
|
|
|||
|
374.6
|
|
725.3
|
|
319.8
|
|
|||
Operating income (loss)
|
161.4
|
|
(276.7
|
)
|
133.8
|
|
|||
Earnings (loss)
|
$
|
94.5
|
|
$
|
(177.2
|
)
|
$
|
80.3
|
|
Production:
|
|
|
|
|
|||||
Oil (MBbls)
|
4,815
|
|
3,694
|
|
2,724
|
|
|||
NGL (MBbls)
|
781
|
|
828
|
|
776
|
|
|||
Natural gas (MMcf)
|
28,008
|
|
33,214
|
|
45,598
|
|
|||
Total production (MBOE)
|
10,264
|
|
10,058
|
|
11,099
|
|
|||
Average realized prices (excluding realized and unrealized gain/loss on commodity derivatives):
|
|
|
|
|
|||||
Oil (per Bbl)
|
$
|
89.70
|
|
$
|
84.84
|
|
$
|
91.62
|
|
NGL (per Bbl)
|
$
|
37.39
|
|
$
|
39.81
|
|
$
|
54.06
|
|
Natural gas (per Mcf)
|
$
|
2.89
|
|
$
|
2.08
|
|
$
|
3.30
|
|
Average realized prices (including realized gain/loss on commodity derivatives):
|
|
|
|
|
|||||
Oil (per Bbl)
|
$
|
89.35
|
|
$
|
86.54
|
|
$
|
86.20
|
|
NGL (per Bbl)
|
$
|
37.39
|
|
$
|
39.81
|
|
$
|
54.06
|
|
Natural gas (per Mcf)
|
$
|
2.96
|
|
$
|
2.91
|
|
$
|
3.84
|
|
Average depreciation, depletion and amortization rate, per BOE
|
$
|
17.41
|
|
$
|
15.28
|
|
$
|
12.25
|
|
Production costs, including taxes, per BOE:
|
|
|
|
|
|||||
Lease operating costs
|
$
|
8.01
|
|
$
|
7.73
|
|
$
|
6.81
|
|
Gathering and transportation
|
1.50
|
|
1.73
|
|
2.19
|
|
|||
Production and property taxes
|
4.54
|
|
3.94
|
|
3.67
|
|
|||
|
$
|
14.05
|
|
$
|
13.40
|
|
$
|
12.67
|
|
•
|
Absence of the write-downs of oil and natural gas properties of $246.8 million (after tax), as discussed in Item 8 - Note 1
|
•
|
Increased oil production of 30 percent, primarily related to drilling activity in the Bakken and Paradox Basin areas
|
•
|
Higher average realized natural gas prices of 39 percent, excluding gain/loss on commodity derivatives
|
•
|
Higher average realized oil prices of 6 percent, excluding gain/loss on commodity derivatives
|
•
|
Lower realized gain on commodity derivatives of $21.1 million (after tax), due to higher commodity prices relative to hedge prices
|
•
|
Higher depreciation, depletion and amortization expense of $16.2 million (after tax), largely due to higher depletion rates
|
•
|
Decreased natural gas production of 16 percent, largely related to production curtailments, normal declines and deferral of certain natural gas development activity
|
•
|
Higher production taxes of $4.3 million (after tax), primarily resulting from higher revenues
|
•
|
Unrealized loss on commodity derivatives of $3.9 million (after tax) in 2013, compared to $400,000 (after tax) in 2012
|
•
|
Higher general and administrative expense of $3.8 million (after tax), including higher payroll-related costs
|
•
|
Higher net interest expense of $3.3 million (after tax), largely due to lower capitalized interest
|
•
|
Increased lease operating expenses of $2.8 million (after tax), largely related to higher costs in the Bakken area resulting from increased production volumes and higher workover costs, as well as higher costs in the Paradox Basin resulting from increased production volumes, partially offset by lower costs at certain natural gas properties where curtailments of production have occurred
|
•
|
Noncash write-downs of oil and natural gas properties of $246.8 million (after tax), as discussed in Item 8 - Note 1
|
•
|
Lower average realized natural gas prices of 25 percent
|
•
|
Decreased natural gas production of 27 percent, largely related to normal declines, production curtailments, deferral of certain natural gas development activity and divestment of existing properties
|
•
|
Higher depreciation, depletion and amortization expense of $11.4 million (after tax), due to higher depletion rates, partially offset by lower volumes
|
•
|
Lower average realized NGL prices of 26 percent
|
•
|
Increased oil production of 36 percent, primarily related to drilling activity in the Bakken area, as well as the Paradox Basin
|
•
|
Lower gathering and transportation expense of $4.3 million (after tax), largely due to lower gathering costs resulting from lower volumes and lower gathering rates in the coalbed area
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(Dollars in millions)
|
||||||||
Operating revenues
|
$
|
1,712.1
|
|
$
|
1,617.4
|
|
$
|
1,510.0
|
|
Operating expenses:
|
|
|
|
|
|||||
Operation and maintenance
|
1,505.2
|
|
1,442.5
|
|
1,337.4
|
|
|||
Depreciation, depletion and amortization
|
74.5
|
|
79.5
|
|
85.5
|
|
|||
Taxes, other than income
|
38.8
|
|
37.5
|
|
36.0
|
|
|||
|
1,618.5
|
|
1,559.5
|
|
1,458.9
|
|
|||
Operating income
|
93.6
|
|
57.9
|
|
51.1
|
|
|||
Earnings
|
$
|
50.9
|
|
$
|
32.4
|
|
$
|
26.4
|
|
Sales (000's):
|
|
|
|
|
|||||
Aggregates (tons)
|
24,713
|
|
23,285
|
|
24,736
|
|
|||
Asphalt (tons)
|
6,228
|
|
5,988
|
|
6,709
|
|
|||
Ready-mixed concrete (cubic yards)
|
3,223
|
|
3,157
|
|
2,864
|
|
•
|
Higher earnings of $6.6 million (after tax) resulting from higher asphalt margins and volumes
|
•
|
Higher earnings of $5.6 million (after tax) resulting from higher aggregate margins and volumes
|
•
|
Lower selling, general and administrative costs of $2.4 million (after tax), largely lower insurance costs
|
•
|
Higher earnings of $1.4 million (after tax) resulting from higher ready-mixed concrete margins and volumes
|
•
|
Increased construction workloads and margins of $1.4 million (after tax)
|
•
|
Higher earnings resulting from higher other product line volumes and margins
|
•
|
Higher earnings of $6.4 million (after tax) resulting from higher ready-mixed concrete margins and volumes, primarily in the North Central and Northwest regions, as well as higher other product line volumes and margins
|
•
|
Increased construction margins of $3.6 million (after tax), largely related to increased construction margins in the South and Intermountain regions
|
•
|
Higher earnings of $3.6 million (after tax) resulting from higher liquid asphalt oil margins and volumes
|
•
|
Lower selling, general and administrative costs of $2.8 million (after tax), largely due to lower benefit and payroll-related costs
|
•
|
Lower gains of $4.0 million (after tax) from the sale of property, plant and equipment
|
•
|
Lower earnings of $3.6 million (after tax) resulting from lower aggregate margins primarily due to higher costs, as well as lower volumes
|
•
|
Lower earnings of $2.9 million (after tax) resulting from lower asphalt margins primarily due to higher costs, as well as lower volumes
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In millions)
|
||||||||
Operating revenues
|
$
|
1,039.8
|
|
$
|
938.6
|
|
$
|
854.4
|
|
Operating expenses:
|
|
|
|
||||||
Operation and maintenance
|
910.7
|
|
831.9
|
|
778.5
|
|
|||
Depreciation, depletion and amortization
|
11.9
|
|
11.1
|
|
11.4
|
|
|||
Taxes, other than income
|
32.0
|
|
29.1
|
|
25.4
|
|
|||
|
954.6
|
|
872.1
|
|
815.3
|
|
|||
Operating income
|
85.2
|
|
66.5
|
|
39.1
|
|
|||
Earnings
|
$
|
52.2
|
|
$
|
38.4
|
|
$
|
21.6
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In millions)
|
||||||||
Operating revenues
|
$
|
9.6
|
|
$
|
10.4
|
|
$
|
11.4
|
|
Operating expenses:
|
|
|
|
||||||
Operation and maintenance
|
.8
|
|
3.3
|
|
4.7
|
|
|||
Depreciation, depletion and amortization
|
2.1
|
|
2.0
|
|
1.6
|
|
|||
Taxes, other than income
|
.1
|
|
.2
|
|
.1
|
|
|||
|
3.0
|
|
5.5
|
|
6.4
|
|
|||
Operating income
|
6.6
|
|
4.9
|
|
5.0
|
|
|||
Income from continuing operations
|
5.1
|
|
4.8
|
|
6.2
|
|
|||
Income (loss) from discontinued operations, net of tax
|
(.3
|
)
|
13.6
|
|
(12.9
|
)
|
|||
Earnings (loss)
|
$
|
4.8
|
|
$
|
18.4
|
|
$
|
(6.7
|
)
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In millions)
|
||||||||
Intersegment transactions:
|
|
|
|
||||||
Operating revenues
|
$
|
146.4
|
|
$
|
124.4
|
|
$
|
190.1
|
|
Purchased natural gas sold
|
87.2
|
|
82.7
|
|
147.7
|
|
|||
Operation and maintenance
|
52.1
|
|
41.7
|
|
42.4
|
|
|||
Income taxes
|
2.8
|
|
—
|
|
—
|
|
|||
Earnings on common stock
|
4.3
|
|
—
|
|
—
|
|
•
|
Adjusted earnings per common share for 2014 are projected in the range of $1.45 to $1.60. GAAP earnings guidance for 2014 is in the same range. Unrealized commodity derivatives fair values can fluctuate causing actual GAAP earnings to vary accordingly.
|
•
|
The Company's long-term compound annual growth goals on earnings per common share from operations are in the range of 7 to 10 percent.
|
•
|
The Company continually seeks opportunities to expand through organic growth opportunities and strategic acquisitions.
|
•
|
The Company focuses on creating value through vertical integration between its business units. For example, the pipeline and energy services business' Dakota Prairie Refinery has the construction materials and services business involved in constructing the facility, the exploration and production business supplying production, either directly or in kind, to the plant, the pipeline transporting natural gas to the plant and the utility supplying electricity.
|
•
|
Rate base growth is projected to be approximately 9 percent compounded annually over the next five years, including plans for an approximate $1.3 billion capital investment program.
|
•
|
Regulatory actions
|
◦
|
The Company filed an application September 18, 2013, with the NDPSC for a natural gas rate increase, as discussed in Item 8 - Note 18.
|
◦
|
The Company filed an application June 14, 2013, for an advance determination of prudence with the NDPSC to add pollution control equipment at the Lewis & Clark generating station projected to be completed in 2016 to comply with the Mercury and Air Toxics Standards rules. On October 9, 2013, the commission issued an order approving the advance determination of prudence.
|
◦
|
The Company filed an application February 11, 2013, with the NDPSC for approval of an environmental cost recovery rider related to ongoing construction costs at the Big Stone Station for the installation of the BART air-quality control system, as discussed in Item 8 - Note 18.
|
◦
|
The Company filed an application December 21, 2012, with the SDPUC for a natural gas rate increase requesting a total of $1.5 million annually or approximately 3.3 percent above current rates. The case includes the costs associated with the increased investment in facilities, including ongoing investment in new and replacement distribution facilities, an operations building, automated meter reading and new customer billing system. The Company implemented the full request July 22, 2013, subject to refund. On November 5, 2013, the commission approved a settlement stipulation for an increase of $900,000 annually, or 2.0 percent, effective with service rendered December 1, 2013.
|
◦
|
The Company filed an application September 26, 2012, with the MTPSC for a natural gas rate increase, as discussed in Item 8 - Note 18.
|
◦
|
Effective November 1, 2013, the WUTC approved recovery of $1.0 million over a one-year period for qualifying pipeline replacement projects. The WUTC issued a policy statement dated December 31, 2012, related to the accelerated replacement of natural gas pipeline facilities.
|
•
|
The Company is constructing an 88-MW simple-cycle natural gas turbine and associated facilities, with an estimated project cost of $77 million and a projected in-service date in third quarter 2014. It is located on owned property adjacent to the Company's Heskett Generating Station near Mandan, North Dakota. The capacity is necessary to meet the requirements of the Company's integrated electric system customers and will be a partial replacement for third-party contract capacity expiring in 2015. Advance determination of prudence and a Certificate of Public Convenience and Necessity have been received from the NDPSC.
|
•
|
Investments are being made in 2014 totaling approximately $70 million to serve the growing electric and natural gas customer base associated with the Bakken oil development where customer growth is substantially higher than the national average.
|
•
|
The Company is analyzing potential projects for accommodating load growth in its industrial and agricultural sectors, with company- and customer-owned pipeline facilities designed to serve existing facilities served by fuel oil or propane, and to serve new customers. The Company is engaged in a 30-mile, approximately $60 million natural gas line project into the Hanford Nuclear Site in Washington.
|
•
|
The Company, along with a partner, expects to build a 345-kilovolt transmission line from Ellendale, North Dakota, to Big Stone City, South Dakota, about 160 miles, at a total cost of approximately $360 million. The Company's share would be one-half. The project is a MISO multi-value project. A route application was filed in August 2013, with the state of South Dakota, and in October 2013, with the state of North Dakota. The project is expected to be complete in 2019.
|
•
|
The Company is involved with a number of pipeline projects to enhance the reliability and deliverability of its system in the Pacific Northwest and Idaho.
|
•
|
In January 2014, the Company launched an open season to obtain capacity commitments on a proposed 375-mile natural gas pipeline from western North Dakota to northwestern Minnesota to transport natural gas to markets in eastern North Dakota, Minnesota, Wisconsin, Michigan and other Midwest markets. The pipeline is expected to provide access to additional markets via interconnections with pipelines owned by Great Lakes Gas Transmission, Viking Gas Transmission and potentially TransCanada, in northwestern Minnesota. An interconnection with the Alliance Pipeline system in eastern North Dakota also is possible. Initially the pipeline would transport approximately 400 MMcf per day of natural gas and could be expanded to more than 500 MMcf per day. The project investment is estimated to be approximately $650 million. Following the open season, receipt of adequate capacity commitments and necessary permits and regulatory approvals, construction on the new pipeline could begin in 2016 with completion expected in 2017.
|
•
|
The Company, in conjunction with Calumet, formed Dakota Prairie Refining, to develop, build and operate Dakota Prairie Refinery. Construction began on the facility in late March 2013 and, when complete, it will process Bakken crude into diesel, which will be marketed within the Bakken region. Other by-products, naphtha and atmospheric tower bottoms, will be railed to other areas. The total project cost estimate has been revised to approximately $350 million, with a projected in-service date in late 2014. EBITDA for the first year of operation is projected to be in the range of $70 million to $90 million, to be shared equally with Calumet.
|
•
|
On October 31, 2013, WBI Energy Transmission filed a Section 4 rate case with the FERC, as discussed in Item 8 - Note 18.
|
•
|
The Company is engaged in various natural gas pipeline projects to be constructed in 2014, including connections for the planned Garden Creek II natural gas processing plant in the Bakken, an expansion of its transmission system to increase capacity to the Black Hills and a 24-mile pipeline and related processing facilities to transport Fidelity's Paradox Basin natural gas production. The total cost for these projects is approximately $50 million.
|
•
|
The Company continues to pursue expansion of facilities and services offered to customers. Energy development within its geographic region is expanding, most notably in the Bakken area, where the Company owns an extensive natural gas pipeline system. Ongoing energy development is expected to continue to provide growth opportunities for this business.
|
•
|
The Company expects to spend approximately $440 million in capital expenditures in 2014.
|
•
|
For 2014, the Company expects a 10 to 20 percent increase in oil production and a 5 to 10 percent increase in NGL production. Natural gas production is expected to decline 20 to 30 percent compared to a year ago, primarily the result of the divestment of certain non-strategic natural gas-based properties in 2013. The vast majority of the capital program is focused on growing oil production considering current relative commodity prices. The Company expects to return to some natural gas development when the commodity prices make it more profitable to do so.
|
•
|
The Company has a total of four drilling rigs deployed on its acreage in the Bakken and Paradox Basin areas, with two rigs operating in each area.
|
•
|
Bakken areas
|
◦
|
The Company owns a total of approximately 125,000 net acres of leaseholds in Mountrail and Stark counties, North Dakota and Richland County, Montana. The Middle Bakken and Three Forks formations are targeted in North Dakota and the Red River formation is targeted in Montana.
|
◦
|
Capital expenditures are expected to total approximately $130 million in 2014.
|
◦
|
Net oil production for the fourth quarter 2013 was approximately 7,900 BOPD which is down 5 percent from third quarter 2013. This quarter-on-quarter drop in oil production was primarily driven by weather-related downtime in December 2013, as well as delay of a three-well pad completion.
|
◦
|
Alternative completion techniques, including increased stage count and cemented liners in the Middle Bakken (Mountrail County) and Three Forks (Mountrail and Stark counties) are being tested, with completion design changes to be finalized later in 2014.
|
•
|
Paradox Basin, Utah
|
◦
|
The Company owns approximately 130,000 net acres of leaseholds including its recent acquisition of 35,000 net acres of leaseholds and has an option to earn another 20,000 acres. The Company expects to further expand its acreage in the basin.
|
◦
|
Capital expenditures are expected to total approximately $170 million in 2014.
|
◦
|
Well costs have increased and now range from $10 million to $11 million per well driven by increased lateral lengths. With longer lateral lengths, estimated ultimate recoveries are expected to increase with the upper range now at 1.5 MMBbls of oil per well.
|
◦
|
Following nine months of flowing at a constant 1,500 BOPD gross, the CCU 12-1 well came off its plateau rate and for the past seven months has still been flowing at approximately 1,000 BOPD. Cumulative production is 600 MBbls of oil.
|
◦
|
Net oil production for fourth quarter 2013 was approximately 2,850 BOPD, up 89 percent from fourth quarter 2012 and 24 percent higher than third quarter 2013. Current production is approximately 3,000 BOPD.
|
◦
|
The CCU 7-1 well has just been completed and is in the initial flowback and production ramp up period. Flowing on a 5/64 choke, the well was producing 350 BOPD at more than 3,000 psi flowing pressure. The well will be brought to full production capability over the next month. The CCU 36-1 has been flowing consistently at an average rate of 930 BOPD gross since October 11, 2013, with an average flowing pressure of approximately 3,400 psi.
|
◦
|
The Company's understanding of this play and the quality of the play continues to improve. It is anticipated that this field will play a key role in the Company's oil growth strategy.
|
•
|
Other opportunities
|
◦
|
The Company has continued its focus on adding a third oil play and on February 10, 2014, entered into an agreement to purchase working interests and leasehold positions in oil and natural gas production assets in the southern Powder River Basin of Wyoming. Current net production is more than 1,100 BOE per day, 80 percent of which is oil, with additional production expected to be on line before closing. For more information, see Item 8 - Note 20.
|
•
|
Earnings guidance reflects estimated average NYMEX index prices for February through December 2014 in the range of $90 to $95 per Bbl of crude oil and $3.75 to $4.25 per Mcf of natural gas. Estimated prices for NGL are in the range of $35 to $45 per Bbl.
|
•
|
Derivatives
|
◦
|
The Company has derivative instruments for 11,000 BOPD for the first six months of 2014, 10,000 BOPD for July through September 2014 and 5,000 BOPD for October through December 2014, utilizing swaps with a weighted average price of $94.90. Covering full-year 2014, the Company has derivative instruments for 40,000 MMBtu of natural gas per day utilizing swaps at a weighted average price of $4.10.
|
◦
|
For 2015, the Company has a derivative instrument for 10,000 MMBtu of natural gas per day utilizing a swap at $4.28.
|
◦
|
The commodity derivative instruments that are in place as of February 18, 2014, are summarized in the following chart:
|
Commodity
|
Type
|
Index
|
Period
Outstanding
|
Forward Notional Volume
(Bbl/MMBtu)
|
Price
(Per Bbl/MMBtu)
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$95.15
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$95.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$90.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$91.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$92.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$93.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$98.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$99.00
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 6/14
|
181,000
|
$100.07
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 12/14
|
365,000
|
$94.05
|
Crude Oil
|
Swap
|
NYMEX
|
1/14 - 12/14
|
365,000
|
$95.00
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 9/14
|
184,000
|
$95.75
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 9/14
|
184,000
|
$96.00
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 9/14
|
92,000
|
$96.25
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 12/14
|
184,000
|
$94.25
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 12/14
|
184,000
|
$95.00
|
Crude Oil
|
Swap
|
NYMEX
|
7/14 - 12/14
|
184,000
|
$95.25
|
Natural Gas
|
Swap
|
NYMEX
|
1/14 - 12/14
|
7,300,000
|
$4.13
|
Natural Gas
|
Swap
|
NYMEX
|
1/14 - 12/14
|
3,650,000
|
$4.05
|
Natural Gas
|
Swap
|
NYMEX
|
1/14 - 12/14
|
3,650,000
|
$4.10
|
Natural Gas
|
Swap
|
NYMEX
|
1/15 - 12/15
|
3,650,000
|
$4.28
|
•
|
Approximate work backlog as of December 31, 2013, was $456 million, compared to $406 million a year ago. Private work represents 11 percent of construction backlog and public work represents 89 percent of backlog. The backlog includes a variety of projects such as highway grading, paving and underground projects, airports, bridge work, reclamation and harbor expansions.
|
•
|
The Company's approximate backlog in North Dakota as of December 31, 2013, was $97 million. North Dakota backlog was $46 million a year ago.
|
•
|
Projected revenues included in the Company's 2014 earnings guidance are in the range of $1.6 billion to $1.8 billion.
|
•
|
The Company anticipates margins in 2014 to be in line with 2013 margins.
|
•
|
The Company continues to pursue opportunities for expansion in energy projects such as refineries, transmission, wind towers and geothermal. Initiatives are aimed at capturing additional market share and expanding into new markets.
|
•
|
As the country's sixth-largest sand and gravel producer, the Company will continue to strategically manage its 1.1 billion tons of aggregate reserves in all its markets, as well as take further advantage of being vertically integrated.
|
•
|
Approximate work backlog as of December 31, 2013, was $459 million, compared to $325 million a year ago. The backlog includes a variety of projects such as substation and line construction, solar and other commercial, institutional and industrial projects including refinery work.
|
•
|
Projected revenues included in the Company's 2014 earnings guidance are in the range of $1.0 billion to $1.1 billion.
|
•
|
The Company anticipates lower margins in 2014 compared to 2013.
|
•
|
The Company continues to pursue opportunities for expansion in energy projects such as refineries, transmission, substations, utility services, as well as solar. Initiatives are aimed at capturing additional market share and expanding into new markets.
|
•
|
System upgrades
|
•
|
Routine replacements
|
•
|
Service extensions
|
•
|
Routine equipment maintenance and replacements
|
•
|
Buildings, land and building improvements
|
•
|
Pipeline, gathering and other midstream projects
|
•
|
Further development of existing properties, acquisition of additional leasehold acreage and exploratory drilling at the exploration and production segment
|
•
|
Power generation and transmission opportunities, including certain costs for additional electric generating capacity
|
•
|
Environmental upgrades
|
•
|
The Company's proportionate share of Dakota Prairie Refinery at the pipeline and energy services segment
|
•
|
Other growth opportunities
|
|
2014
|
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
|
Total
|
|
Fair
Value
|
|
||||||||
|
(Dollars in millions)
|
|||||||||||||||||||||||
Long-term debt:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Fixed rate
|
$
|
9.3
|
|
$
|
266.4
|
|
$
|
288.5
|
|
$
|
43.5
|
|
$
|
108.4
|
|
$
|
906.5
|
|
$
|
1,622.6
|
|
$
|
1,683.0
|
|
Weighted average interest rate
|
6.9
|
%
|
5.7
|
%
|
6.4
|
%
|
6.3
|
%
|
6.1
|
%
|
5.1
|
%
|
5.6
|
%
|
—
|
|
||||||||
Variable rate
|
$
|
3.0
|
|
$
|
3.0
|
|
$
|
5.3
|
|
$
|
161.4
|
|
$
|
21.8
|
|
$
|
37.5
|
|
$
|
232.0
|
|
$
|
229.6
|
|
Weighted average interest rate
|
1.2
|
%
|
1.2
|
%
|
1.8
|
%
|
.5
|
%
|
2.0
|
%
|
2.4
|
%
|
1.0
|
%
|
—
|
|
/s/ David L. Goodin
|
/s/ Doran N. Schwartz
|
|
|
David L. Goodin
|
Doran N. Schwartz
|
President and Chief Executive Officer
|
Vice President and Chief Financial Officer
|
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands, except per share amounts)
|
||||||||
Operating revenues:
|
|
|
|
||||||
Electric, natural gas distribution and pipeline and energy services
|
$
|
1,264,574
|
|
$
|
1,131,626
|
|
$
|
1,343,714
|
|
Exploration and production, construction materials and contracting, construction services and other
|
3,197,830
|
|
2,943,805
|
|
2,706,778
|
|
|||
Total operating revenues
|
4,462,404
|
|
4,075,431
|
|
4,050,492
|
|
|||
Operating expenses:
|
|
|
|
|
|
|
|||
Fuel and purchased power
|
83,528
|
|
72,380
|
|
64,485
|
|
|||
Purchased natural gas sold
|
505,065
|
|
425,220
|
|
572,187
|
|
|||
Operation and maintenance:
|
|
|
|
|
|
||||
Electric, natural gas distribution and pipeline and energy services
|
269,825
|
|
254,194
|
|
275,866
|
|
|||
Exploration and production, construction materials and contracting, construction services and other
|
2,535,872
|
|
2,377,285
|
|
2,215,269
|
|
|||
Depreciation, depletion and amortization
|
386,856
|
|
359,205
|
|
343,395
|
|
|||
Taxes, other than income
|
188,359
|
|
176,140
|
|
172,923
|
|
|||
Write-downs of oil and natural gas properties (Note 1)
|
—
|
|
391,800
|
|
—
|
|
|||
Total operating expenses
|
3,969,505
|
|
4,056,224
|
|
3,644,125
|
|
|||
Operating income
|
492,899
|
|
19,207
|
|
406,367
|
|
|||
Earnings (loss) from equity method investments
|
(132
|
)
|
5,383
|
|
4,693
|
|
|||
Other income
|
6,768
|
|
6,642
|
|
6,520
|
|
|||
Interest expense
|
83,917
|
|
76,699
|
|
81,354
|
|
|||
Income (loss) before income taxes
|
415,618
|
|
(45,467
|
)
|
336,226
|
|
|||
Income taxes
|
136,736
|
|
(31,146
|
)
|
110,274
|
|
|||
Income (loss) from continuing operations
|
278,882
|
|
(14,321
|
)
|
225,952
|
|
|||
Income (loss) from discontinued operations, net of tax (Note 3)
|
(312
|
)
|
13,567
|
|
(12,926
|
)
|
|||
Net income (loss)
|
278,570
|
|
(754
|
)
|
213,026
|
|
|||
Net loss attributable to noncontrolling interest
|
(363
|
)
|
—
|
|
—
|
|
|||
Dividends declared on preferred stocks
|
685
|
|
685
|
|
685
|
|
|||
Earnings (loss) on common stock
|
$
|
278,248
|
|
$
|
(1,439
|
)
|
$
|
212,341
|
|
Earnings (loss) per common share - basic:
|
|
|
|
|
|
|
|||
Earnings (loss) before discontinued operations
|
$
|
1.47
|
|
$
|
(.08
|
)
|
$
|
1.19
|
|
Discontinued operations, net of tax
|
—
|
|
.07
|
|
(.07
|
)
|
|||
Earnings (loss) per common share - basic
|
$
|
1.47
|
|
$
|
(.01
|
)
|
$
|
1.12
|
|
Earnings (loss) per common share - diluted:
|
|
|
|
|
|
|
|||
Earnings (loss) before discontinued operations
|
$
|
1.47
|
|
$
|
(.08
|
)
|
$
|
1.19
|
|
Discontinued operations, net of tax
|
—
|
|
.07
|
|
(.07
|
)
|
|||
Earnings (loss) per common share - diluted
|
$
|
1.47
|
|
$
|
(.01
|
)
|
$
|
1.12
|
|
Weighted average common shares outstanding - basic
|
188,855
|
|
188,826
|
|
188,763
|
|
|||
Weighted average common shares outstanding - diluted
|
189,693
|
|
188,826
|
|
188,905
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Net income (loss)
|
$
|
278,570
|
|
$
|
(754
|
)
|
$
|
213,026
|
|
Other comprehensive income (loss):
|
|
|
|
||||||
Net unrealized gain (loss) on derivative instruments qualifying as hedges:
|
|
|
|
||||||
Net unrealized gain (loss) on derivative instruments arising during the period, net of tax of $(3,116), $4,829 and $4,683 in 2013, 2012 and 2011, respectively
|
(5,594
|
)
|
8,497
|
|
7,900
|
|
|||
Reclassification adjustment for (gain) loss on derivative instruments included in net income, net of tax of $(2,548), $(5,141) and $0 in 2013, 2012 and 2011, respectively
|
(4,189
|
)
|
(8,754
|
)
|
—
|
|
|||
Net unrealized gain (loss) on derivative instruments qualifying as hedges
|
(9,783
|
)
|
(257
|
)
|
7,900
|
|
|||
Postretirement liability adjustment:
|
|
|
|
||||||
Postretirement liability gains (losses) arising during the period, net of tax of $11,818, $(2,060) and $(14,205) in 2013, 2012 and 2011, respectively
|
18,539
|
|
(3,106
|
)
|
(23,473
|
)
|
|||
Amortization of postretirement liability losses included in net periodic benefit cost, net of tax of $1,276, $1,379 and $632 in 2013, 2012 and 2011, respectively
|
2,001
|
|
2,079
|
|
1,046
|
|
|||
Postretirement liability adjustment
|
20,540
|
|
(1,027
|
)
|
(22,427
|
)
|
|||
Foreign currency translation adjustment:
|
|
|
|
||||||
Foreign currency translation adjustment recognized during the period, net of tax of $(177), $(296) and $(767) in 2013, 2012 and 2011, respectively
|
(299
|
)
|
(476
|
)
|
(1,189
|
)
|
|||
Reclassification adjustment for (gain) loss on foreign currency translation adjustment included in net income, net of tax of $70, $2 and $(65) in 2013, 2012 and 2011, respectively
|
143
|
|
3
|
|
(106
|
)
|
|||
Foreign currency translation adjustment
|
(156
|
)
|
(473
|
)
|
(1,295
|
)
|
|||
Net unrealized gain (loss) on available-for-sale investments:
|
|
|
|
||||||
Net unrealized loss on available-for-sale investments arising during the period, net of tax of $(105), $(52) and $(20) in 2013, 2012 and 2011, respectively
|
(194
|
)
|
(97
|
)
|
(36
|
)
|
|||
Reclassification adjustment for loss on available-for-sale investments included in net income, net of tax of $59, $72 and $64 in 2013, 2012 and 2011, respectively
|
109
|
|
134
|
|
118
|
|
|||
Net unrealized gain (loss) on available-for-sale investments
|
(85
|
)
|
37
|
|
82
|
|
|||
Other comprehensive income (loss)
|
10,516
|
|
(1,720
|
)
|
(15,740
|
)
|
|||
Comprehensive income (loss)
|
289,086
|
|
(2,474
|
)
|
197,286
|
|
|||
Comprehensive loss attributable to noncontrolling interest
|
(363
|
)
|
—
|
|
—
|
|
|||
Comprehensive income (loss) attributable to common stockholders
|
$
|
289,449
|
|
$
|
(2,474
|
)
|
$
|
197,286
|
|
December 31,
|
2013
|
|
2012
|
|
||
(In thousands, except shares and per share amounts)
|
|
|||||
Assets
|
|
|
||||
Current assets:
|
|
|
||||
Cash and cash equivalents
|
$
|
45,225
|
|
$
|
49,042
|
|
Receivables, net
|
713,067
|
|
678,123
|
|
||
Inventories
|
282,391
|
|
317,415
|
|
||
Deferred income taxes
|
25,048
|
|
22,846
|
|
||
Commodity derivative instruments
|
1,447
|
|
18,304
|
|
||
Prepayments and other current assets
|
49,510
|
|
42,351
|
|
||
Total current assets
|
1,116,688
|
|
1,128,081
|
|
||
Investments
|
112,939
|
|
103,243
|
|
||
Property, plant and equipment (Note 1)
|
8,803,866
|
|
8,107,751
|
|
||
Less accumulated depreciation, depletion and amortization
|
3,872,487
|
|
3,608,912
|
|
||
Net property, plant and equipment
|
4,931,379
|
|
4,498,839
|
|
||
Deferred charges and other assets:
|
|
|
|
|
||
Goodwill (Note 5)
|
636,039
|
|
636,039
|
|
||
Other intangible assets, net (Note 5)
|
13,099
|
|
17,129
|
|
||
Other
|
251,188
|
|
299,160
|
|
||
Total deferred charges and other assets
|
900,326
|
|
952,328
|
|
||
Total assets
|
$
|
7,061,332
|
|
$
|
6,682,491
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
||
Short-term borrowings (Note 9)
|
$
|
11,500
|
|
$
|
28,200
|
|
Long-term debt due within one year
|
12,277
|
|
134,108
|
|
||
Accounts payable
|
404,961
|
|
388,015
|
|
||
Taxes payable
|
74,175
|
|
46,475
|
|
||
Dividends payable
|
33,737
|
|
171
|
|
||
Accrued compensation
|
69,661
|
|
48,448
|
|
||
Commodity derivative instruments
|
7,483
|
|
—
|
|
||
Other accrued liabilities
|
171,106
|
|
204,698
|
|
||
Total current liabilities
|
784,900
|
|
850,115
|
|
||
Long-term debt (Note 9)
|
1,842,286
|
|
1,610,867
|
|
||
Deferred credits and other liabilities:
|
|
|
|
|
||
Deferred income taxes
|
859,306
|
|
755,102
|
|
||
Other liabilities
|
718,938
|
|
818,159
|
|
||
Total deferred credits and other liabilities
|
1,578,244
|
|
1,573,261
|
|
||
Commitments and contingencies (Notes 16, 18 and 19)
|
|
|
|
|
||
Equity:
|
|
|
|
|
||
Preferred stocks (Note 11)
|
15,000
|
|
15,000
|
|
||
Common stockholders' equity:
|
|
|
|
|
||
Common stock (Note 12)
Authorized - 500,000,000 shares, $1.00 par value
Issued - 189,868,780 shares in 2013 and 189,369,450 shares in 2012
|
189,869
|
|
189,369
|
|
||
Other paid-in capital
|
1,056,996
|
|
1,039,080
|
|
||
Retained earnings
|
1,603,130
|
|
1,457,146
|
|
||
Accumulated other comprehensive loss
|
(38,205
|
)
|
(48,721
|
)
|
||
Treasury stock at cost - 538,921 shares
|
(3,626
|
)
|
(3,626
|
)
|
||
Total common stockholders' equity
|
2,808,164
|
|
2,633,248
|
|
||
Total stockholders' equity
|
2,823,164
|
|
2,648,248
|
|
||
Noncontrolling interest
|
32,738
|
|
—
|
|
||
Total equity
|
2,855,902
|
|
2,648,248
|
|
||
Total liabilities and equity
|
$
|
7,061,332
|
|
$
|
6,682,491
|
|
Years ended December 31, 2013, 2012 and 2011
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
|
|
|
|
|
Other
Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Loss
|
|
|
|
Non-
|
|
|
|||||||||||||||
|
Preferred Stock
|
Common Stock
|
Treasury Stock
|
controlling
|
|
|
||||||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Interest
|
|
Total
|
|
||||||||||||||
|
(In thousands, except shares)
|
|||||||||||||||||||||||||||||
Balance at December 31, 2010
|
150,000
|
|
$
|
15,000
|
|
188,901,379
|
|
$
|
188,901
|
|
$
|
1,026,349
|
|
$
|
1,497,439
|
|
$
|
(31,261
|
)
|
(538,921
|
)
|
$
|
(3,626
|
)
|
$
|
—
|
|
$
|
2,692,802
|
|
Net income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
213,026
|
|
—
|
|
—
|
|
—
|
|
—
|
|
213,026
|
|
||||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(15,740
|
)
|
—
|
|
—
|
|
—
|
|
(15,740
|
)
|
||||||||
Dividends declared on preferred stocks
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
||||||||
Dividends declared on common stock
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(123,657
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(123,657
|
)
|
||||||||
Stock-based compensation
|
—
|
|
—
|
|
423,591
|
|
424
|
|
10,164
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
10,588
|
|
||||||||
Net tax deficit on stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
(909
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(909
|
)
|
||||||||
Issuance of common stock
|
—
|
|
—
|
|
7,515
|
|
7
|
|
135
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
142
|
|
||||||||
Balance at December 31, 2011
|
150,000
|
|
15,000
|
|
189,332,485
|
|
189,332
|
|
1,035,739
|
|
1,586,123
|
|
(47,001
|
)
|
(538,921
|
)
|
(3,626
|
)
|
—
|
|
2,775,567
|
|
||||||||
Net loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(754
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(754
|
)
|
||||||||
Other comprehensive loss
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,720
|
)
|
—
|
|
—
|
|
—
|
|
(1,720
|
)
|
||||||||
Dividends declared on preferred stocks
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
||||||||
Dividends declared on common stock
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(127,538
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(127,538
|
)
|
||||||||
Stock-based compensation
|
—
|
|
—
|
|
25,743
|
|
26
|
|
5,094
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5,120
|
|
||||||||
Net tax deficit on stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,958
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,958
|
)
|
||||||||
Issuance of common stock
|
—
|
|
—
|
|
11,222
|
|
11
|
|
205
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
216
|
|
||||||||
Balance at December 31, 2012
|
150,000
|
|
15,000
|
|
189,369,450
|
|
189,369
|
|
1,039,080
|
|
1,457,146
|
|
(48,721
|
)
|
(538,921
|
)
|
(3,626
|
)
|
—
|
|
2,648,248
|
|
||||||||
Net income (loss)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
278,933
|
|
—
|
|
—
|
|
—
|
|
(363
|
)
|
278,570
|
|
||||||||
Other comprehensive income
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
10,516
|
|
—
|
|
—
|
|
—
|
|
10,516
|
|
||||||||
Dividends declared on preferred stocks
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(685
|
)
|
||||||||
Dividends declared on common stock
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(132,264
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
(132,264
|
)
|
||||||||
Stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
5,281
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5,281
|
|
||||||||
Net tax deficit on stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,419
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,419
|
)
|
||||||||
Issuance of common stock
|
—
|
|
—
|
|
499,330
|
|
500
|
|
14,054
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
14,554
|
|
||||||||
Contribution from non-controlling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
33,101
|
|
33,101
|
|
||||||||
Balance at December 31, 2013
|
150,000
|
|
$
|
15,000
|
|
189,868,780
|
|
$
|
189,869
|
|
$
|
1,056,996
|
|
$
|
1,603,130
|
|
$
|
(38,205
|
)
|
(538,921
|
)
|
$
|
(3,626
|
)
|
$
|
32,738
|
|
$
|
2,855,902
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Operating activities:
|
|
|
|
||||||
Net income (loss)
|
$
|
278,570
|
|
$
|
(754
|
)
|
$
|
213,026
|
|
Income (loss) from discontinued operations, net of tax
|
(312
|
)
|
13,567
|
|
(12,926
|
)
|
|||
Income (loss) from continuing operations
|
278,882
|
|
(14,321
|
)
|
225,952
|
|
|||
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
|
|||
Depreciation, depletion and amortization
|
386,856
|
|
359,205
|
|
343,395
|
|
|||
Earnings (loss), net of distributions, from equity method investments
|
2,281
|
|
(618
|
)
|
(2,111
|
)
|
|||
Deferred income taxes
|
86,778
|
|
(7,503
|
)
|
118,925
|
|
|||
Unrealized (gain) loss on commodity derivatives
|
6,267
|
|
624
|
|
(1,827
|
)
|
|||
Write-downs of oil and natural gas properties (Note 1)
|
—
|
|
391,800
|
|
—
|
|
|||
Changes in current assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
|||
Receivables
|
(40,669
|
)
|
(13,416
|
)
|
(30,452
|
)
|
|||
Inventories
|
30,452
|
|
(42,334
|
)
|
(24,226
|
)
|
|||
Other current assets
|
(9,474
|
)
|
297
|
|
7,729
|
|
|||
Accounts payable
|
15,084
|
|
6,352
|
|
(12,263
|
)
|
|||
Other current liabilities
|
29,392
|
|
(59,001
|
)
|
33,738
|
|
|||
Other noncurrent changes
|
(43,937
|
)
|
(33,665
|
)
|
(31,538
|
)
|
|||
Net cash provided by continuing operations
|
741,912
|
|
587,420
|
|
627,322
|
|
|||
Net cash provided by (used in) discontinued operations
|
281
|
|
(2,680
|
)
|
(674
|
)
|
|||
Net cash provided by operating activities
|
742,193
|
|
584,740
|
|
626,648
|
|
|||
Investing activities:
|
|
|
|
|
|
|
|||
Capital expenditures
|
(909,400
|
)
|
(872,920
|
)
|
(497,000
|
)
|
|||
Acquisitions, net of cash acquired
|
—
|
|
(67,261
|
)
|
(157
|
)
|
|||
Net proceeds from sale or disposition of property and other
|
124,541
|
|
40,110
|
|
40,107
|
|
|||
Investments
|
302
|
|
9,725
|
|
(10,302
|
)
|
|||
Proceeds from sale of equity method investments
|
1,896
|
|
2,394
|
|
2,807
|
|
|||
Net cash used in continuing operations
|
(782,661
|
)
|
(887,952
|
)
|
(464,545
|
)
|
|||
Net cash provided by discontinued operations
|
—
|
|
—
|
|
—
|
|
|||
Net cash used in investing activities
|
(782,661
|
)
|
(887,952
|
)
|
(464,545
|
)
|
|||
Financing activities:
|
|
|
|
|
|
|
|||
Issuance of short-term borrowings
|
9,500
|
|
20,100
|
|
—
|
|
|||
Repayment of short-term borrowings
|
—
|
|
—
|
|
(20,000
|
)
|
|||
Issuance of long-term debt
|
507,924
|
|
467,957
|
|
300
|
|
|||
Repayment of long-term debt
|
(423,707
|
)
|
(138,775
|
)
|
(85,151
|
)
|
|||
Proceeds from issuance of common stock
|
14,554
|
|
88
|
|
5,744
|
|
|||
Dividends paid
|
(98,405
|
)
|
(159,768
|
)
|
(123,323
|
)
|
|||
Excess tax benefit on stock-based compensation
|
—
|
|
26
|
|
1,239
|
|
|||
Contribution from noncontrolling interest
|
27,000
|
|
—
|
|
—
|
|
|||
Net cash provided by (used in) continuing operations
|
36,866
|
|
189,628
|
|
(221,191
|
)
|
|||
Net cash provided by discontinued operations
|
—
|
|
—
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
36,866
|
|
189,628
|
|
(221,191
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(215
|
)
|
(146
|
)
|
(214
|
)
|
|||
Decrease in cash and cash equivalents
|
(3,817
|
)
|
(113,730
|
)
|
(59,302
|
)
|
|||
Cash and cash equivalents - beginning of year
|
49,042
|
|
162,772
|
|
222,074
|
|
|||
Cash and cash equivalents - end of year
|
$
|
45,225
|
|
$
|
49,042
|
|
$
|
162,772
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Aggregates held for resale
|
$
|
101,568
|
|
$
|
87,715
|
|
Materials and supplies
|
69,808
|
|
69,390
|
|
||
Asphalt oil
|
38,099
|
|
67,480
|
|
||
Merchandise for resale
|
21,720
|
|
31,172
|
|
||
Natural gas in storage (current)
|
16,417
|
|
29,030
|
|
||
Other
|
34,779
|
|
32,628
|
|
||
Total
|
$
|
282,391
|
|
$
|
317,415
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Interest capitalized
|
$
|
6,033
|
|
$
|
8,659
|
|
$
|
10,821
|
|
AFUDC - borrowed
|
$
|
2,767
|
|
$
|
2,483
|
|
$
|
1,666
|
|
AFUDC - equity
|
$
|
3,322
|
|
$
|
4,530
|
|
$
|
2,587
|
|
|
2013
|
|
2012
|
|
Weighted Average
Depreciable Life in
Years
|
||
|
(Dollars in thousands, where applicable)
|
||||||
Regulated:
|
|
|
|
||||
Electric:
|
|
|
|
||||
Generation
|
$
|
570,394
|
|
$
|
546,011
|
|
42
|
Distribution
|
308,202
|
|
276,446
|
|
39
|
||
Transmission
|
196,824
|
|
180,543
|
|
48
|
||
Construction in progress
|
141,365
|
|
62,123
|
|
-
|
||
Other
|
99,037
|
|
85,461
|
|
14
|
||
Natural gas distribution:
|
|
|
|
|
|
||
Distribution
|
1,384,587
|
|
1,308,314
|
|
40
|
||
Construction in progress
|
46,763
|
|
71,679
|
|
-
|
||
Other
|
345,551
|
|
309,957
|
|
25
|
||
Pipeline and energy services:
|
|
|
|
|
|
||
Transmission
|
418,594
|
|
403,126
|
|
52
|
||
Gathering
|
39,597
|
|
42,420
|
|
19
|
||
Storage
|
42,939
|
|
42,058
|
|
51
|
||
Construction in progress
|
6,937
|
|
13,667
|
|
-
|
||
Other
|
39,504
|
|
38,386
|
|
29
|
||
Nonregulated:
|
|
|
|
|
|
||
Pipeline and energy services:
|
|
|
|
|
|
||
Midstream
|
213,063
|
|
233,840
|
|
17
|
||
Construction in progress
|
188,641
|
|
29,657
|
|
-
|
||
Other
|
12,897
|
|
13,379
|
|
11
|
||
Exploration and production:
|
|
|
|
|
|
||
Oil and natural gas properties
|
3,017,879
|
|
2,723,356
|
|
*
|
||
Other
|
42,969
|
|
41,204
|
|
8
|
||
Construction materials and contracting:
|
|
|
|
|
|
||
Land
|
125,551
|
|
126,788
|
|
-
|
||
Buildings and improvements
|
70,000
|
|
73,884
|
|
19
|
||
Machinery, vehicles and equipment
|
906,774
|
|
899,592
|
|
12
|
||
Construction in progress
|
13,315
|
|
11,165
|
|
-
|
||
Aggregate reserves
|
394,715
|
|
393,552
|
|
**
|
||
Construction services:
|
|
|
|
|
|
||
Land
|
4,821
|
|
4,723
|
|
-
|
||
Buildings and improvements
|
16,628
|
|
16,563
|
|
20
|
||
Machinery, vehicles and equipment
|
105,991
|
|
100,445
|
|
6
|
||
Other
|
7,508
|
|
8,893
|
|
4
|
||
Other:
|
|
|
|
|
|
||
Land
|
2,837
|
|
2,837
|
|
-
|
||
Other
|
47,160
|
|
47,682
|
|
23
|
||
Eliminations
|
(7,177
|
)
|
—
|
|
|
||
Less accumulated depreciation, depletion and amortization
|
3,872,487
|
|
3,608,912
|
|
|
||
Net property, plant and equipment
|
$
|
4,931,379
|
|
$
|
4,498,839
|
|
|
|
|
Year Costs Incurred
|
|||||||||||||
|
Total
|
|
2013
|
|
2012
|
|
2011
|
|
2010 and prior
|
|
|||||
|
(In thousands)
|
||||||||||||||
Acquisition
|
$
|
93,758
|
|
$
|
1,514
|
|
$
|
23,588
|
|
$
|
28,543
|
|
$
|
40,113
|
|
Development
|
14,824
|
|
12,622
|
|
1,633
|
|
271
|
|
298
|
|
|||||
Exploration
|
14,547
|
|
9,952
|
|
4,346
|
|
198
|
|
51
|
|
|||||
Capitalized interest
|
1,740
|
|
340
|
|
418
|
|
410
|
|
572
|
|
|||||
Total costs not subject to amortization
|
$
|
124,869
|
|
$
|
24,428
|
|
$
|
29,985
|
|
$
|
29,422
|
|
$
|
41,034
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Costs and estimated earnings in excess of billings on uncompleted contracts
|
$
|
60,828
|
|
$
|
64,996
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts
|
$
|
84,189
|
|
$
|
83,167
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Short-term retainage *
|
$
|
55,906
|
|
$
|
54,256
|
|
Long-term retainage **
|
4,229
|
|
2,038
|
|
||
Total retainage
|
$
|
60,135
|
|
$
|
56,294
|
|
|
2013
|
|
2012
|
|
2011
|
|
|
(In thousands)
|
|||||
Weighted average common shares outstanding - basic
|
188,855
|
|
188,826
|
|
188,763
|
|
Effect of dilutive stock options and performance share awards
|
838
|
|
—
|
|
142
|
|
Weighted average common shares outstanding - diluted
|
189,693
|
|
188,826
|
|
188,905
|
|
Shares excluded from the calculation of diluted earnings per share
|
—
|
|
58
|
|
—
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Interest, net of amount capitalized
|
$
|
81,689
|
|
$
|
74,378
|
|
$
|
78,133
|
|
Income taxes paid (refunded), net
|
$
|
24,857
|
|
$
|
3,277
|
|
$
|
(12,287
|
)
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Property, plant and equipment additions in accounts payable
|
$
|
67,129
|
|
$
|
76,205
|
|
$
|
41,540
|
|
|
Net Unrealized Gain (Loss) on Derivative
Instruments
Qualifying as Hedges
|
|
Postretirement
Liability Adjustment
|
|
Foreign Currency
Translation
Adjustment
|
|
Net Unrealized Gains on Available-for-sale Investments
|
|
Total Accumulated
Other
Comprehensive
Loss
|
|
|||||
|
(In thousands)
|
||||||||||||||
Balance at December 31, 2011
|
$
|
6,275
|
|
$
|
(53,320
|
)
|
$
|
(38
|
)
|
$
|
82
|
|
$
|
(47,001
|
)
|
Current-period other comprehensive income (loss)
|
(257
|
)
|
(1,027
|
)
|
(473
|
)
|
37
|
|
(1,720
|
)
|
|||||
Balance at December 31, 2012
|
6,018
|
|
(54,347
|
)
|
(511
|
)
|
119
|
|
(48,721
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
(5,594
|
)
|
18,539
|
|
(299
|
)
|
(194
|
)
|
12,452
|
|
|||||
Amounts reclassified from accumulated other comprehensive loss
|
(4,189
|
)
|
2,001
|
|
143
|
|
109
|
|
(1,936
|
)
|
|||||
Net current-period other comprehensive income (loss)
|
(9,783
|
)
|
20,540
|
|
(156
|
)
|
(85
|
)
|
10,516
|
|
|||||
Balance at December 31, 2013
|
$
|
(3,765
|
)
|
$
|
(33,807
|
)
|
$
|
(667
|
)
|
$
|
34
|
|
$
|
(38,205
|
)
|
|
2013
|
|
Location on Consolidated Statements of Income
|
|
|
(In thousands)
|
|
||
Reclassification adjustment for gain (loss) on derivative instruments included in net income:
|
|
|
||
Commodity derivative instruments
|
$
|
7,803
|
|
Operating revenues
|
Interest rate derivative instruments
|
(1,066
|
)
|
Interest expense
|
|
|
6,737
|
|
|
|
|
(2,548
|
)
|
Income taxes
|
|
|
4,189
|
|
|
|
Amortization of postretirement liability losses included in net periodic benefit cost
|
(3,277
|
)
|
(a)
|
|
|
1,276
|
|
Income taxes
|
|
|
(2,001
|
)
|
|
|
Reclassification adjustment for loss on foreign currency translation adjustment included in net income
|
(213
|
)
|
Earnings (loss) from equity method investments
|
|
|
70
|
|
Earnings (loss) from equity method investments
|
|
|
(143
|
)
|
|
|
Reclassification adjustment for loss on available-for-sale investments included in net income
|
(168
|
)
|
Other income
|
|
|
59
|
|
Income taxes
|
|
|
(109
|
)
|
|
|
Total reclassifications
|
$
|
1,936
|
|
|
|
Balance at January 1, 2013
|
|
*
|
Goodwill Acquired During the Year
|
|
Balance at December 31, 2013
|
|
*
|
|||
|
(In thousands)
|
|
|||||||||
Natural gas distribution
|
$
|
345,736
|
|
|
$
|
—
|
|
$
|
345,736
|
|
|
Pipeline and energy services
|
9,737
|
|
|
—
|
|
9,737
|
|
|
|||
Construction materials and contracting
|
176,290
|
|
|
—
|
|
176,290
|
|
|
|||
Construction services
|
104,276
|
|
|
—
|
|
104,276
|
|
|
|||
Total
|
$
|
636,039
|
|
|
$
|
—
|
|
$
|
636,039
|
|
|
|
Balance at January 1, 2012
|
|
*
|
Goodwill Acquired During the Year
|
|
**
|
Balance at December 31, 2012
|
|
*
|
|||
|
(In thousands)
|
|
||||||||||
Natural gas distribution
|
$
|
345,736
|
|
|
$
|
—
|
|
|
$
|
345,736
|
|
|
Pipeline and energy services
|
9,737
|
|
|
—
|
|
|
9,737
|
|
|
|||
Construction materials and contracting
|
176,290
|
|
|
—
|
|
|
176,290
|
|
|
|||
Construction services
|
103,168
|
|
|
1,108
|
|
|
104,276
|
|
|
|||
Total
|
$
|
634,931
|
|
|
$
|
1,108
|
|
|
$
|
636,039
|
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Customer relationships
|
$
|
21,310
|
|
$
|
21,310
|
|
Accumulated amortization
|
(13,726
|
)
|
(11,701
|
)
|
||
|
7,584
|
|
9,609
|
|
||
Noncompete agreements
|
6,186
|
|
7,236
|
|
||
Accumulated amortization
|
(4,840
|
)
|
(5,326
|
)
|
||
|
1,346
|
|
1,910
|
|
||
Other
|
10,995
|
|
10,979
|
|
||
Accumulated amortization
|
(6,826
|
)
|
(5,369
|
)
|
||
|
4,169
|
|
5,610
|
|
||
Total
|
$
|
13,099
|
|
$
|
17,129
|
|
|
Estimated Recovery Period
|
*
|
2013
|
|
2012
|
|
||
|
|
|
(In thousands)
|
|||||
Regulatory assets:
|
|
|
|
|
||||
Deferred income taxes
|
**
|
|
$
|
125,607
|
|
$
|
121,781
|
|
Pension and postretirement benefits (a)
|
(e)
|
|
105,123
|
|
166,477
|
|
||
Taxes recoverable from customers (a)
|
Over plant lives
|
|
18,266
|
|
9,078
|
|
||
Manufactured gas plant sites remediation (a)
|
Up to 4 years
|
|
15,797
|
|
15,828
|
|
||
Natural gas costs recoverable through rate adjustments (b)
|
Up to 28 months
|
|
12,060
|
|
2,981
|
|
||
Long-term debt refinancing costs (a)
|
Up to 25 years
|
|
8,697
|
|
9,144
|
|
||
Costs related to identifying generation development (a)
|
Up to 13 years
|
|
4,512
|
|
5,773
|
|
||
Other (a) (b)
|
Largely within 1- 5 years
|
|
15,311
|
|
20,132
|
|
||
Total regulatory assets
|
|
|
305,373
|
|
351,194
|
|
||
Regulatory liabilities:
|
|
|
|
|
||||
Plant removal and decommissioning costs (c)
|
|
|
308,431
|
|
296,037
|
|
||
Deferred income taxes**
|
|
|
64,914
|
|
82,077
|
|
||
Taxes refundable to customers (c)
|
|
|
20,180
|
|
24,212
|
|
||
Natural gas costs refundable through rate adjustments (d)
|
|
|
16,932
|
|
35,328
|
|
||
Other (c) (d)
|
|
|
21,868
|
|
12,828
|
|
||
Total regulatory liabilities
|
|
|
432,325
|
|
450,482
|
|
||
Net regulatory position
|
|
|
$
|
(126,952
|
)
|
$
|
(99,288
|
)
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Commodity derivatives designated as cash flow hedges:
|
|
|
|
||||||
Amount of gain (loss) recognized in accumulated other comprehensive loss (effective portion), net of tax
|
$
|
(6,153
|
)
|
$
|
10,209
|
|
$
|
10,806
|
|
Amount of gain reclassified from accumulated other comprehensive loss into operating revenues (effective portion), net of tax
|
(4,916
|
)
|
(8,788
|
)
|
—
|
|
|||
Amount of gain (loss) recognized in operating revenues (ineffective portion), before tax
|
(1,422
|
)
|
(730
|
)
|
1,827
|
|
|||
|
|
|
|
||||||
Interest rate derivatives designated as cash flow hedges:
|
|
|
|
||||||
Amount of gain (loss) recognized in accumulated other comprehensive loss (effective portion), net of tax
|
559
|
|
(1,712
|
)
|
(2,906
|
)
|
|||
Amount of loss reclassified from accumulated other comprehensive loss into interest expense (effective portion), net of tax
|
727
|
|
34
|
|
—
|
|
|||
Amount of loss recognized in interest expense (ineffective portion), before tax
|
(769
|
)
|
—
|
|
—
|
|
|||
|
|
|
|
||||||
Commodity derivatives not designated as hedging instruments:
|
|
|
|
||||||
Amount of gain (loss) recognized in operating revenues, before tax
|
(4,845
|
)
|
106
|
|
—
|
|
Asset Derivatives
|
Location on Consolidated Balance Sheets
|
Fair Value at December 31, 2013
|
|
Fair Value at December 31, 2012
|
|
||
|
|
(In thousands)
|
|||||
Designated as hedges:
|
|
|
|
||||
Commodity derivatives
|
Commodity derivative instruments
|
$
|
—
|
|
$
|
18,084
|
|
|
|
—
|
|
18,084
|
|
||
Not designated as hedges:
|
|
|
|
||||
Commodity derivatives
|
Commodity derivative instruments
|
1,447
|
|
220
|
|
||
|
Other assets - noncurrent
|
503
|
|
—
|
|
||
|
|
1,950
|
|
220
|
|
||
Total asset derivatives
|
|
$
|
1,950
|
|
$
|
18,304
|
|
Liability Derivatives
|
Location on Consolidated Balance Sheets
|
Fair Value at December 31, 2013
|
|
Fair Value at December 31, 2012
|
|
||
|
|
(In thousands)
|
|||||
Designated as hedges:
|
|
|
|
||||
Interest rate derivatives
|
Other accrued liabilities
|
$
|
—
|
|
$
|
6,255
|
|
|
|
—
|
|
6,255
|
|
||
Not designated as hedges:
|
|
|
|
||||
Commodity derivatives
|
Commodity derivative instruments
|
7,483
|
|
—
|
|
||
|
|
7,483
|
|
—
|
|
||
Total liability derivatives
|
|
$
|
7,483
|
|
$
|
6,255
|
|
December 31, 2013
|
Gross Amounts Recognized on the Consolidated Balance Sheets
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
Net
|
||||||
|
(In thousands)
|
||||||||
Assets:
|
|
|
|
||||||
Commodity derivatives
|
$
|
1,950
|
|
$
|
(1,950
|
)
|
$
|
—
|
|
Total assets
|
$
|
1,950
|
|
$
|
(1,950
|
)
|
$
|
—
|
|
Liabilities:
|
|
|
|
||||||
Commodity derivatives
|
$
|
7,483
|
|
$
|
(1,950
|
)
|
$
|
5,533
|
|
Total liabilities
|
$
|
7,483
|
|
$
|
(1,950
|
)
|
$
|
5,533
|
|
December 31, 2012
|
Gross Amounts Recognized on the Consolidated Balance Sheets
|
Gross Amounts Not Offset on the Consolidated Balance Sheets
|
Net
|
||||||
|
(In thousands)
|
||||||||
Assets:
|
|
|
|
||||||
Commodity derivatives
|
$
|
18,304
|
|
$
|
—
|
|
$
|
18,304
|
|
Total assets
|
$
|
18,304
|
|
$
|
—
|
|
$
|
18,304
|
|
Liabilities:
|
|
|
|
||||||
Interest rate derivatives
|
$
|
6,255
|
|
$
|
—
|
|
$
|
6,255
|
|
Total liabilities
|
$
|
6,255
|
|
$
|
—
|
|
$
|
6,255
|
|
December 31, 2013
|
Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
||||
|
(In thousands)
|
|||||||||||
Mortgage-backed securities
|
$
|
8,151
|
|
$
|
69
|
|
$
|
(27
|
)
|
$
|
8,193
|
|
U.S. Treasury securities
|
1,906
|
|
15
|
|
(4
|
)
|
1,917
|
|
||||
Total
|
$
|
10,057
|
|
$
|
84
|
|
$
|
(31
|
)
|
$
|
10,110
|
|
December 31, 2012
|
Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Fair Value
|
|
||||
|
(In thousands)
|
|||||||||||
Mortgage-backed securities
|
$
|
8,054
|
|
$
|
144
|
|
$
|
(3
|
)
|
$
|
8,195
|
|
U.S. Treasury securities
|
1,763
|
|
43
|
|
—
|
|
1,806
|
|
||||
Total
|
$
|
9,817
|
|
$
|
187
|
|
$
|
(3
|
)
|
$
|
10,001
|
|
|
Fair Value Measurements
at December 31, 2013, Using
|
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
Balance at December 31, 2013
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Money market funds
|
$
|
—
|
|
$
|
19,227
|
|
$
|
—
|
|
$
|
19,227
|
|
Insurance contract*
|
—
|
|
62,370
|
|
—
|
|
62,370
|
|
||||
Available-for-sale securities:
|
|
|
|
|
||||||||
Mortgage-backed securities
|
—
|
|
8,193
|
|
—
|
|
8,193
|
|
||||
U.S. Treasury securities
|
—
|
|
1,917
|
|
—
|
|
1,917
|
|
||||
Commodity derivative instruments
|
—
|
|
1,950
|
|
—
|
|
1,950
|
|
||||
Total assets measured at fair value
|
$
|
—
|
|
$
|
93,657
|
|
$
|
—
|
|
$
|
93,657
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||
Commodity derivative instruments
|
$
|
—
|
|
$
|
7,483
|
|
$
|
—
|
|
$
|
7,483
|
|
Total liabilities measured at fair value
|
$
|
—
|
|
$
|
7,483
|
|
$
|
—
|
|
$
|
7,483
|
|
|
Fair Value Measurements
at December 31, 2012, Using
|
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs (Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
Balance at December 31, 2012
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Money market funds
|
$
|
—
|
|
$
|
24,240
|
|
$
|
—
|
|
$
|
24,240
|
|
Insurance contract*
|
—
|
|
48,898
|
|
—
|
|
48,898
|
|
||||
Available-for-sale securities:
|
|
|
|
|
||||||||
Mortgage-backed securities
|
—
|
|
8,195
|
|
—
|
|
8,195
|
|
||||
U.S. Treasury securities
|
—
|
|
1,806
|
|
—
|
|
1,806
|
|
||||
Commodity derivative instruments
|
—
|
|
18,304
|
|
—
|
|
18,304
|
|
||||
Total assets measured at fair value
|
$
|
—
|
|
$
|
101,443
|
|
$
|
—
|
|
$
|
101,443
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||
Interest rate derivative instruments
|
$
|
—
|
|
$
|
6,255
|
|
$
|
—
|
|
$
|
6,255
|
|
Total liabilities measured at fair value
|
$
|
—
|
|
$
|
6,255
|
|
$
|
—
|
|
$
|
6,255
|
|
|
2013
|
2012
|
||||||||||
|
Carrying Amount
|
|
Fair Value
|
|
Carrying Amount
|
|
Fair Value
|
|
||||
|
(In thousands)
|
|||||||||||
Long-term debt
|
$
|
1,854,563
|
|
$
|
1,912,590
|
|
$
|
1,744,975
|
|
$
|
1,888,135
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Senior Notes at a weighted average rate of 5.52%, due on dates ranging from June 19, 2015 to April 15, 2044
|
$
|
1,545,078
|
|
$
|
1,349,160
|
|
Commercial paper at a weighted average rate of .40%, supported by revolving credit agreements
|
153,924
|
|
293,000
|
|
||
Term Loan Agreements at a weighted average rate of 2.08%, due on dates ranging from April 22, 2014 to April 22, 2023
|
75,000
|
|
—
|
|
||
Medium-Term Notes at a weighted average rate of 7.32%, due on dates ranging from September 15, 2027 to March 16, 2029
|
35,000
|
|
59,000
|
|
||
Other notes at a weighted average rate of 5.23%, due on dates ranging from September 1, 2020 to February 1, 2035
|
39,863
|
|
40,090
|
|
||
Credit agreements at a weighted average rate of 4.11%, due on dates ranging from February 28, 2014 to November 30, 2038
|
5,701
|
|
3,768
|
|
||
Discount
|
(3
|
)
|
(43
|
)
|
||
Total long-term debt
|
1,854,563
|
|
1,744,975
|
|
||
Less current maturities
|
12,277
|
|
134,108
|
|
||
Net long-term debt
|
$
|
1,842,286
|
|
$
|
1,610,867
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Balance at beginning of year
|
$
|
102,545
|
|
$
|
98,151
|
|
Liabilities incurred
|
5,610
|
|
6,523
|
|
||
Liabilities acquired
|
—
|
|
—
|
|
||
Liabilities settled
|
(22,257
|
)
|
(10,472
|
)
|
||
Accretion expense
|
4,574
|
|
4,266
|
|
||
Revisions in estimates
|
7,671
|
|
3,655
|
|
||
Other
|
386
|
|
422
|
|
||
Balance at end of year
|
$
|
98,529
|
|
$
|
102,545
|
|
|
2013
|
|
2012
|
|
||
(In thousands, except shares and per share amounts)
|
|
|||||
Authorized:
|
|
|
||||
Preferred -
|
|
|
||||
500,000 shares, cumulative, par value $100, issuable in series
|
|
|
||||
Preferred stock A -
|
|
|
||||
1,000,000 shares, cumulative, without par value, issuable in series (none outstanding)
|
|
|
||||
Preference
-
|
|
|
||||
500,000 shares, cumulative, without par value, issuable in series (none outstanding)
|
|
|
||||
Outstanding:
|
|
|
||||
4.50% Series - 100,000 shares
|
$
|
10,000
|
|
$
|
10,000
|
|
4.70% Series - 50,000 shares
|
5,000
|
|
5,000
|
|
||
Total preferred stocks
|
$
|
15,000
|
|
$
|
15,000
|
|
|
|
|
2013
|
|
|
|
2012
|
|
|
|
2011
|
|
||||||
Grant-date fair value
|
|
|
|
$29.01
|
|
|
|
|
$17.18
|
|
|
|
|
$19.99
|
|
|||
Blended volatility range
|
16.10
|
%
|
-
|
19.39
|
%
|
24.29
|
%
|
-
|
25.81
|
%
|
23.20
|
%
|
-
|
32.18
|
%
|
|||
Risk-free interest rate range
|
.09
|
%
|
-
|
.40
|
%
|
.10
|
%
|
-
|
.35
|
%
|
.09
|
%
|
-
|
1.34
|
%
|
|||
Discounted dividends per share
|
|
|
|
$2.12
|
|
|
|
|
$1.19
|
|
|
|
|
$1.23
|
|
|
Number of
Shares
|
|
Weighted Average Grant-Date Fair Value
|
|
|
Nonvested at beginning of period
|
786,136
|
|
$
|
18.17
|
|
Granted
|
264,614
|
|
29.01
|
|
|
Vested
|
—
|
|
—
|
|
|
Forfeited
|
(300,759
|
)
|
18.20
|
|
|
Nonvested at end of period
|
749,991
|
|
$
|
21.99
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
United States
|
$
|
415,202
|
|
$
|
(47,175
|
)
|
$
|
333,486
|
|
Foreign
|
416
|
|
1,708
|
|
2,740
|
|
|||
Income (loss) before income taxes from continuing operations
|
$
|
415,618
|
|
$
|
(45,467
|
)
|
$
|
336,226
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Current:
|
|
|
|
||||||
Federal
|
$
|
45,518
|
|
$
|
(26,858
|
)
|
$
|
(7,188
|
)
|
State
|
4,311
|
|
858
|
|
778
|
|
|||
Foreign
|
(29
|
)
|
(75
|
)
|
127
|
|
|||
|
49,800
|
|
(26,075
|
)
|
(6,283
|
)
|
|||
Deferred:
|
|
|
|
|
|
|
|||
Income taxes:
|
|
|
|
|
|
||||
Federal
|
78,953
|
|
(1,224
|
)
|
105,528
|
|
|||
State
|
8,031
|
|
(6,323
|
)
|
13,157
|
|
|||
Investment tax credit - net
|
(206
|
)
|
44
|
|
240
|
|
|||
|
86,778
|
|
(7,503
|
)
|
118,925
|
|
|||
Change in uncertain tax positions
|
—
|
|
1,974
|
|
(1,048
|
)
|
|||
Change in accrued interest
|
158
|
|
458
|
|
(1,320
|
)
|
|||
Total income tax expense (benefit)
|
$
|
136,736
|
|
$
|
(31,146
|
)
|
$
|
110,274
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Deferred tax assets:
|
|
|
||||
Regulatory matters
|
$
|
125,607
|
|
$
|
121,781
|
|
Accrued pension costs
|
74,320
|
|
85,037
|
|
||
Alternative minimum tax credit carryforward
|
33,304
|
|
—
|
|
||
Compensation-related
|
31,550
|
|
23,441
|
|
||
Asset retirement obligations
|
29,578
|
|
26,748
|
|
||
Legal and environmental contingencies
|
10,710
|
|
8,046
|
|
||
Other
|
45,101
|
|
39,792
|
|
||
Total deferred tax assets
|
350,170
|
|
304,845
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||
Depreciation and basis differences on property, plant and equipment
|
813,597
|
|
755,392
|
|
||
Basis differences on oil and natural gas producing properties
|
266,168
|
|
167,113
|
|
||
Regulatory matters
|
64,914
|
|
82,077
|
|
||
Intangible asset amortization
|
13,579
|
|
14,078
|
|
||
Other
|
26,170
|
|
18,441
|
|
||
Total deferred tax liabilities
|
1,184,428
|
|
1,037,101
|
|
||
Net deferred income tax liability
|
$
|
(834,258
|
)
|
$
|
(732,256
|
)
|
|
2013
|
|
|
(In thousands)
|
|
||
Change in net deferred income tax liability from the preceding table
|
$
|
102,002
|
|
Deferred taxes associated with other comprehensive loss
|
(7,277
|
)
|
|
Other
|
(7,947
|
)
|
|
Deferred income tax expense for the period
|
$
|
86,778
|
|
Years ended December 31,
|
2013
|
2012
|
2011
|
||||||||||||
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
Amount
|
|
%
|
|
|||
|
(Dollars in thousands)
|
||||||||||||||
Computed tax at federal statutory rate
|
$
|
145,466
|
|
35.0
|
|
$
|
(15,914
|
)
|
35.0
|
|
$
|
117,679
|
|
35.0
|
|
Increases (reductions) resulting from:
|
|
|
|
|
|
|
|
|
|||||||
State income taxes, net of federal income tax
|
10,524
|
|
2.5
|
|
2,469
|
|
(5.4
|
)
|
10,653
|
|
3.2
|
|
|||
Nonqualified benefit plans
|
(5,173
|
)
|
(1.2
|
)
|
(2,359
|
)
|
5.2
|
|
(2,918
|
)
|
(.9
|
)
|
|||
Depletion allowance
|
(3,764
|
)
|
(.9
|
)
|
(3,728
|
)
|
8.2
|
|
(3,266
|
)
|
(1.0
|
)
|
|||
Federal renewable energy credit
|
(3,404
|
)
|
(.8
|
)
|
(3,401
|
)
|
7.5
|
|
(3,485
|
)
|
(1.0
|
)
|
|||
Deductible K-Plan dividends
|
(1,593
|
)
|
(.4
|
)
|
(2,829
|
)
|
6.2
|
|
(2,282
|
)
|
(.7
|
)
|
|||
AFUDC equity
|
(1,074
|
)
|
(.3
|
)
|
(1,500
|
)
|
3.3
|
|
(873
|
)
|
(.3
|
)
|
|||
Resolution of tax matters and uncertain tax positions
|
(859
|
)
|
(.2
|
)
|
2,559
|
|
(5.6
|
)
|
(3,906
|
)
|
(1.2
|
)
|
|||
Deferred tax rate changes
|
741
|
|
.2
|
|
(3,083
|
)
|
6.8
|
|
(417
|
)
|
(.1
|
)
|
|||
Other
|
(4,128
|
)
|
(1.0
|
)
|
(3,360
|
)
|
7.3
|
|
(911
|
)
|
(.2
|
)
|
|||
Total income tax expense (benefit)
|
$
|
136,736
|
|
32.9
|
|
$
|
(31,146
|
)
|
68.5
|
|
$
|
110,274
|
|
32.8
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Balance at beginning of year
|
$
|
14,914
|
|
$
|
11,206
|
|
$
|
9,378
|
|
Additions for tax positions of prior years
|
—
|
|
3,708
|
|
4,172
|
|
|||
Settlements
|
—
|
|
—
|
|
(2,344
|
)
|
|||
Balance at end of year
|
$
|
14,914
|
|
$
|
14,914
|
|
$
|
11,206
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
External operating revenues:
|
|
|
|
||||||
Electric
|
$
|
257,260
|
|
$
|
236,895
|
|
$
|
225,468
|
|
Natural gas distribution
|
851,945
|
|
754,848
|
|
907,400
|
|
|||
Pipeline and energy services
|
155,369
|
|
139,883
|
|
210,846
|
|
|||
|
1,264,574
|
|
1,131,626
|
|
1,343,714
|
|
|||
Exploration and production
|
490,924
|
|
412,651
|
|
359,873
|
|
|||
Construction materials and contracting
|
1,675,444
|
|
1,597,257
|
|
1,509,538
|
|
|||
Construction services
|
1,029,909
|
|
932,013
|
|
834,918
|
|
|||
Other
|
1,553
|
|
1,884
|
|
2,449
|
|
|||
|
3,197,830
|
|
2,943,805
|
|
2,706,778
|
|
|||
Total external operating revenues
|
$
|
4,462,404
|
|
$
|
4,075,431
|
|
$
|
4,050,492
|
|
|
|
|
|
||||||
Intersegment operating revenues:
|
|
|
|
|
|
|
|||
Electric
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
Natural gas distribution
|
—
|
|
—
|
|
—
|
|
|||
Pipeline and energy services
|
46,699
|
|
53,274
|
|
67,497
|
|
|||
Exploration and production
|
45,099
|
|
35,966
|
|
93,713
|
|
|||
Construction materials and contracting
|
36,693
|
|
20,168
|
|
472
|
|
|||
Construction services
|
9,930
|
|
6,545
|
|
19,471
|
|
|||
Other
|
8,067
|
|
8,486
|
|
8,997
|
|
|||
Intersegment eliminations
|
(146,488
|
)
|
(124,439
|
)
|
(190,150
|
)
|
|||
Total intersegment operating revenues
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
||||||
Depreciation, depletion and amortization:
|
|
|
|
|
|
|
|||
Electric
|
$
|
32,789
|
|
$
|
32,509
|
|
$
|
32,177
|
|
Natural gas distribution
|
50,031
|
|
45,731
|
|
44,641
|
|
|||
Pipeline and energy services
|
29,119
|
|
27,684
|
|
25,502
|
|
|||
Exploration and production
|
186,458
|
|
160,681
|
|
142,645
|
|
|||
Construction materials and contracting
|
74,470
|
|
79,527
|
|
85,459
|
|
|||
Construction services
|
11,939
|
|
11,063
|
|
11,399
|
|
|||
Other
|
2,050
|
|
2,010
|
|
1,572
|
|
|||
Total depreciation, depletion and amortization
|
$
|
386,856
|
|
$
|
359,205
|
|
$
|
343,395
|
|
|
|
|
|
||||||
Interest expense:
|
|
|
|
|
|
|
|||
Electric
|
$
|
12,590
|
|
$
|
12,421
|
|
$
|
13,745
|
|
Natural gas distribution
|
25,123
|
|
28,726
|
|
29,444
|
|
|||
Pipeline and energy services
|
10,330
|
|
7,742
|
|
10,516
|
|
|||
Exploration and production
|
14,315
|
|
9,018
|
|
7,445
|
|
|||
Construction materials and contracting
|
17,394
|
|
15,211
|
|
16,241
|
|
|||
Construction services
|
4,306
|
|
4,435
|
|
4,473
|
|
|||
Other
|
15
|
|
13
|
|
—
|
|
|||
Intersegment eliminations
|
(156
|
)
|
(867
|
)
|
(510
|
)
|
|||
Total interest expense
|
$
|
83,917
|
|
$
|
76,699
|
|
$
|
81,354
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Income taxes:
|
|
|
|
|
|
|
|||
Electric
|
$
|
9,683
|
|
$
|
8,975
|
|
$
|
7,242
|
|
Natural gas distribution
|
16,633
|
|
12,005
|
|
16,931
|
|
|||
Pipeline and energy services
|
3,390
|
|
15,291
|
|
12,912
|
|
|||
Exploration and production
|
53,197
|
|
(108,264
|
)
|
46,298
|
|
|||
Construction materials and contracting
|
24,765
|
|
14,099
|
|
11,227
|
|
|||
Construction services
|
29,504
|
|
24,128
|
|
13,426
|
|
|||
Other
|
2,433
|
|
2,620
|
|
2,238
|
|
|||
Intersegment eliminations
|
(2,869
|
)
|
—
|
|
—
|
|
|||
Total income taxes
|
$
|
136,736
|
|
$
|
(31,146
|
)
|
$
|
110,274
|
|
|
|
|
|
||||||
Earnings (loss) on common stock:
|
|
|
|
|
|
|
|||
Electric
|
$
|
34,837
|
|
$
|
30,634
|
|
$
|
29,258
|
|
Natural gas distribution
|
37,656
|
|
29,409
|
|
38,398
|
|
|||
Pipeline and energy services
|
7,629
|
|
26,588
|
|
23,082
|
|
|||
Exploration and production
|
94,450
|
|
(177,283
|
)
|
80,282
|
|
|||
Construction materials and contracting
|
50,946
|
|
32,420
|
|
26,430
|
|
|||
Construction services
|
52,213
|
|
38,429
|
|
21,627
|
|
|||
Other
|
5,136
|
|
4,797
|
|
6,190
|
|
|||
Intersegment eliminations
|
(4,307
|
)
|
—
|
|
—
|
|
|||
Earnings (loss) on common stock before income (loss) from discontinued operations
|
278,560
|
|
(15,006
|
)
|
225,267
|
|
|||
Income (loss) from discontinued operations, net of tax*
|
(312
|
)
|
13,567
|
|
(12,926
|
)
|
|||
Total earnings (loss) on common stock
|
$
|
278,248
|
|
$
|
(1,439
|
)
|
$
|
212,341
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
|
|
|
|||
Electric
|
$
|
168,557
|
|
$
|
112,035
|
|
$
|
52,072
|
|
Natural gas distribution
|
101,279
|
|
130,178
|
|
70,624
|
|
|||
Pipeline and energy services
|
127,092
|
|
133,787
|
|
45,556
|
|
|||
Exploration and production
|
391,315
|
|
554,528
|
|
272,855
|
|
|||
Construction materials and contracting
|
34,607
|
|
45,083
|
|
52,303
|
|
|||
Construction services
|
15,102
|
|
14,835
|
|
9,711
|
|
|||
Other
|
2,249
|
|
791
|
|
18,759
|
|
|||
Net proceeds from sale or disposition of property and other
|
(112,131
|
)
|
(57,460
|
)
|
(40,857
|
)
|
|||
Total net capital expenditures
|
$
|
728,070
|
|
$
|
933,777
|
|
$
|
481,023
|
|
|
|
|
|
||||||
Assets:
|
|
|
|
|
|
|
|||
Electric**
|
$
|
884,283
|
|
$
|
760,324
|
|
$
|
672,940
|
|
Natural gas distribution**
|
1,786,068
|
|
1,703,459
|
|
1,679,091
|
|
|||
Pipeline and energy services
|
798,701
|
|
622,470
|
|
526,797
|
|
|||
Exploration and production
|
1,616,131
|
|
1,539,017
|
|
1,481,556
|
|
|||
Construction materials and contracting
|
1,305,808
|
|
1,371,252
|
|
1,374,026
|
|
|||
Construction services
|
450,614
|
|
429,547
|
|
418,519
|
|
|||
Other***
|
219,727
|
|
256,422
|
|
403,196
|
|
|||
Total assets
|
$
|
7,061,332
|
|
$
|
6,682,491
|
|
$
|
6,556,125
|
|
|
|
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Property, plant and equipment:
|
|
|
|
|
|
|
|||
Electric**
|
$
|
1,315,822
|
|
$
|
1,150,584
|
|
$
|
1,068,524
|
|
Natural gas distribution**
|
1,776,901
|
|
1,689,950
|
|
1,568,866
|
|
|||
Pipeline and energy services
|
962,172
|
|
816,533
|
|
719,291
|
|
|||
Exploration and production
|
3,060,848
|
|
2,764,560
|
|
2,615,146
|
|
|||
Construction materials and contracting
|
1,510,355
|
|
1,504,981
|
|
1,499,852
|
|
|||
Construction services
|
134,948
|
|
130,624
|
|
124,796
|
|
|||
Other
|
49,997
|
|
50,519
|
|
49,747
|
|
|||
Eliminations
|
(7,177
|
)
|
—
|
|
—
|
|
|||
Less accumulated depreciation, depletion and amortization
|
3,872,487
|
|
3,608,912
|
|
3,361,208
|
|
|||
Net property, plant and equipment
|
$
|
4,931,379
|
|
$
|
4,498,839
|
|
$
|
4,285,014
|
|
|
Pension Benefits
|
Other
Postretirement Benefits
|
||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
||||
|
(In thousands)
|
|||||||||||
Change in benefit obligation:
|
|
|
|
|
||||||||
Benefit obligation at beginning of year
|
$
|
459,111
|
|
$
|
435,618
|
|
$
|
103,358
|
|
$
|
110,689
|
|
Service cost
|
155
|
|
1,078
|
|
1,675
|
|
1,747
|
|
||||
Interest cost
|
16,249
|
|
17,598
|
|
3,215
|
|
4,166
|
|
||||
Plan participants' contributions
|
—
|
|
—
|
|
1,472
|
|
2,688
|
|
||||
Amendments
|
—
|
|
—
|
|
—
|
|
(11,418
|
)
|
||||
Actuarial (gain) loss
|
(44,551
|
)
|
30,939
|
|
(20,985
|
)
|
3,469
|
|
||||
Benefits paid
|
(28,192
|
)
|
(26,122
|
)
|
(7,009
|
)
|
(7,983
|
)
|
||||
Benefit obligation at end of year
|
402,772
|
|
459,111
|
|
81,726
|
|
103,358
|
|
||||
Change in net plan assets:
|
|
|
|
|
|
|
|
|
||||
Fair value of plan assets at beginning of year
|
309,184
|
|
278,000
|
|
74,361
|
|
68,085
|
|
||||
Actual gain on plan assets
|
35,539
|
|
34,493
|
|
13,819
|
|
6,497
|
|
||||
Employer contribution
|
18,313
|
|
22,813
|
|
1,900
|
|
5,074
|
|
||||
Plan participants' contributions
|
—
|
|
—
|
|
1,472
|
|
2,688
|
|
||||
Benefits paid
|
(28,192
|
)
|
(26,122
|
)
|
(7,009
|
)
|
(7,983
|
)
|
||||
Fair value of net plan assets at end of year
|
334,844
|
|
309,184
|
|
84,543
|
|
74,361
|
|
||||
Funded status - (under) over
|
$
|
(67,928
|
)
|
$
|
(149,927
|
)
|
$
|
2,817
|
|
$
|
(28,997
|
)
|
Amounts recognized in the Consolidated Balance Sheets at December 31:
|
|
|
|
|
|
|
|
|
||||
Other assets (noncurrent)
|
$
|
—
|
|
$
|
—
|
|
$
|
9,679
|
|
$
|
—
|
|
Other accrued liabilities (current)
|
—
|
|
—
|
|
(381
|
)
|
(655
|
)
|
||||
Other liabilities (noncurrent)
|
(67,928
|
)
|
(149,927
|
)
|
(6,481
|
)
|
(28,342
|
)
|
||||
Net amount recognized
|
$
|
(67,928
|
)
|
$
|
(149,927
|
)
|
$
|
2,817
|
|
$
|
(28,997
|
)
|
Amounts recognized in accumulated other comprehensive (income) loss consist of:
|
|
|
|
|
|
|
|
|
||||
Actuarial loss
|
$
|
135,061
|
|
$
|
202,406
|
|
$
|
11,314
|
|
$
|
43,589
|
|
Prior service cost (credit)
|
365
|
|
437
|
|
(17,137
|
)
|
(18,594
|
)
|
||||
Total
|
$
|
135,426
|
|
$
|
202,843
|
|
$
|
(5,823
|
)
|
$
|
24,995
|
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Projected benefit obligation
|
$
|
402,772
|
|
$
|
459,111
|
|
Accumulated benefit obligation
|
$
|
402,772
|
|
$
|
459,111
|
|
Fair value of plan assets
|
$
|
334,844
|
|
$
|
309,184
|
|
|
Pension Benefits
|
Other
Postretirement Benefits
|
||||||||||||||||
|
2013
|
|
2012
|
|
2011
|
|
2013
|
|
2012
|
|
2011
|
|
||||||
|
(In thousands)
|
|||||||||||||||||
Components of net periodic benefit cost:
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
155
|
|
$
|
1,078
|
|
$
|
2,252
|
|
$
|
1,675
|
|
$
|
1,747
|
|
$
|
1,443
|
|
Interest cost
|
16,249
|
|
17,598
|
|
19,500
|
|
3,215
|
|
4,166
|
|
4,700
|
|
||||||
Expected return on assets
|
(19,917
|
)
|
(23,536
|
)
|
(22,809
|
)
|
(4,343
|
)
|
(4,890
|
)
|
(5,051
|
)
|
||||||
Amortization of prior service cost (credit)
|
71
|
|
(46
|
)
|
45
|
|
(1,457
|
)
|
(1,438
|
)
|
(2,677
|
)
|
||||||
Recognized net actuarial loss
|
7,173
|
|
7,070
|
|
4,656
|
|
1,814
|
|
2,134
|
|
753
|
|
||||||
Curtailment loss (gain)
|
—
|
|
(1,023
|
)
|
1,218
|
|
—
|
|
—
|
|
—
|
|
||||||
Amortization of net transition obligation
|
—
|
|
—
|
|
—
|
|
—
|
|
2,128
|
|
2,125
|
|
||||||
Net periodic benefit cost, including amount capitalized
|
3,731
|
|
1,141
|
|
4,862
|
|
904
|
|
3,847
|
|
1,293
|
|
||||||
Less amount capitalized
|
727
|
|
937
|
|
1,196
|
|
164
|
|
910
|
|
(50
|
)
|
||||||
Net periodic benefit cost
|
3,004
|
|
204
|
|
3,666
|
|
740
|
|
2,937
|
|
1,343
|
|
||||||
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive (income) loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net (gain) loss
|
(60,173
|
)
|
19,982
|
|
76,310
|
|
(30,461
|
)
|
1,863
|
|
23,863
|
|
||||||
Prior service credit
|
—
|
|
—
|
|
—
|
|
—
|
|
(11,418
|
)
|
—
|
|
||||||
Amortization of actuarial loss
|
(7,173
|
)
|
(7,070
|
)
|
(4,656
|
)
|
(1,814
|
)
|
(2,134
|
)
|
(753
|
)
|
||||||
Amortization of prior service (cost) credit
|
(71
|
)
|
1,069
|
|
(1,263
|
)
|
1,457
|
|
1,438
|
|
2,677
|
|
||||||
Amortization of net transition obligation
|
—
|
|
—
|
|
—
|
|
—
|
|
(2,128
|
)
|
(2,125
|
)
|
||||||
Total recognized in accumulated other comprehensive (income) loss
|
(67,417
|
)
|
13,981
|
|
70,391
|
|
(30,818
|
)
|
(12,379
|
)
|
23,662
|
|
||||||
Total recognized in net periodic benefit cost and accumulated other comprehensive (income) loss
|
$
|
(64,413
|
)
|
$
|
14,185
|
|
$
|
74,057
|
|
$
|
(30,078
|
)
|
$
|
(9,442
|
)
|
$
|
25,005
|
|
|
Pension Benefits
|
Other
Postretirement Benefits
|
||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Discount rate
|
4.53
|
%
|
3.65
|
%
|
4.48
|
%
|
3.67
|
%
|
Expected return on plan assets
|
7.00
|
%
|
7.00
|
%
|
6.00
|
%
|
6.00
|
%
|
Rate of compensation increase
|
N/A
|
|
N/A
|
|
3.00
|
%
|
4.00
|
%
|
|
Pension Benefits
|
Other
Postretirement Benefits
|
||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
Discount rate
|
3.65
|
%
|
4.16
|
%
|
3.67
|
%
|
4.13
|
%
|
Expected return on plan assets
|
7.00
|
%
|
7.75
|
%
|
6.00
|
%
|
6.75
|
%
|
Rate of compensation increase
|
N/A*
|
|
N/A*
|
|
4.00
|
%
|
4.00
|
%
|
|
|
|
2013
|
|
|
|
|
2012
|
|
||
Health care trend rate assumed for next year
|
6.0
|
%
|
-
|
7.0
|
%
|
|
6.0
|
%
|
-
|
8.0
|
%
|
Health care cost trend rate - ultimate
|
5.0
|
%
|
-
|
6.0
|
%
|
|
5.0
|
%
|
-
|
6.0
|
%
|
Year in which ultimate trend rate achieved
|
|
|
2017
|
|
|
|
|
|
2017
|
|
|
1 Percentage
Point Increase
|
|
1 Percentage Point
Decrease
|
|
||
|
(In thousands)
|
|||||
Effect on total of service and interest cost components
|
$
|
159
|
|
$
|
(135
|
)
|
Effect on postretirement benefit obligation
|
$
|
3,352
|
|
$
|
(2,920
|
)
|
|
Fair Value Measurements at
December 31, 2013, Using |
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable
Inputs
(Level 3)
|
|
Balance at December 31, 2013
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
—
|
|
$
|
9,406
|
|
$
|
—
|
|
$
|
9,406
|
|
Equity securities:
|
|
|
|
|
|
|||||||
U.S. companies
|
62,599
|
|
—
|
|
—
|
|
62,599
|
|
||||
International companies
|
39,437
|
|
—
|
|
—
|
|
39,437
|
|
||||
Collective and mutual funds*
|
116,265
|
|
42,483
|
|
—
|
|
158,748
|
|
||||
Corporate bonds
|
—
|
|
42,721
|
|
—
|
|
42,721
|
|
||||
Municipal bonds
|
—
|
|
7,561
|
|
—
|
|
7,561
|
|
||||
U.S. Treasury securities
|
7,487
|
|
4,335
|
|
—
|
|
11,822
|
|
||||
Total assets measured at fair value
|
$
|
225,788
|
|
$
|
106,506
|
|
$
|
—
|
|
$
|
332,294
|
|
|
Fair Value Measurements at
December 31, 2012, Using |
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable
Inputs
(Level 3)
|
|
Balance at December 31, 2012
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
2,145
|
|
$
|
10,460
|
|
$
|
—
|
|
$
|
12,605
|
|
Equity securities:
|
|
|
|
|
|
|||||||
U.S. companies
|
86,981
|
|
—
|
|
—
|
|
86,981
|
|
||||
International companies
|
39,818
|
|
—
|
|
—
|
|
39,818
|
|
||||
Collective and mutual funds*
|
82,787
|
|
20,065
|
|
—
|
|
102,852
|
|
||||
Corporate bonds
|
—
|
|
45,112
|
|
—
|
|
45,112
|
|
||||
Municipal bonds
|
—
|
|
9,302
|
|
—
|
|
9,302
|
|
||||
U.S. Treasury securities
|
7,980
|
|
4,534
|
|
—
|
|
12,514
|
|
||||
Total assets measured at fair value
|
$
|
219,711
|
|
$
|
89,473
|
|
$
|
—
|
|
$
|
309,184
|
|
|
Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
|
||
|
Corporate Bonds
|
|
|
|
(In thousands)
|
|
|
Balance at beginning of year
|
$
|
289
|
|
Total realized/unrealized losses
|
(47
|
)
|
|
Purchases, issuances and settlements (net)
|
(242
|
)
|
|
Balance at end of year
|
$
|
—
|
|
|
Fair Value Measurements at
December 31, 2013, Using |
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable
Inputs
(Level 3)
|
|
Balance at December 31, 2013
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
—
|
|
$
|
2,142
|
|
$
|
—
|
|
$
|
2,142
|
|
Equity securities:
|
|
|
|
|
|
|
|
|
||||
U.S. companies
|
2,802
|
|
—
|
|
—
|
|
2,802
|
|
||||
International companies
|
221
|
|
—
|
|
—
|
|
221
|
|
||||
Insurance contract*
|
—
|
|
79,374
|
|
—
|
|
79,374
|
|
||||
Total assets measured at fair value
|
$
|
3,023
|
|
$
|
81,516
|
|
$
|
—
|
|
$
|
84,539
|
|
|
Fair Value Measurements at
December 31, 2012, Using |
|
||||||||||
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable
Inputs
(Level 3)
|
|
Balance at December 31, 2012
|
|
||||
|
(In thousands)
|
|||||||||||
Assets:
|
|
|
|
|
||||||||
Cash equivalents
|
$
|
1,053
|
|
$
|
1,991
|
|
$
|
—
|
|
$
|
3,044
|
|
Equity securities:
|
|
|
|
|
|
|||||||
U.S. companies
|
2,207
|
|
—
|
|
—
|
|
2,207
|
|
||||
International companies
|
260
|
|
—
|
|
—
|
|
260
|
|
||||
Insurance contract*
|
—
|
|
68,850
|
|
—
|
|
68,850
|
|
||||
Total assets measured at fair value
|
$
|
3,520
|
|
$
|
70,841
|
|
$
|
—
|
|
$
|
74,361
|
|
Years
|
Pension
Benefits
|
|
Other Postretirement Benefits
|
|
Expected
Medicare
Part D Subsidy
|
|
|||
|
(In thousands)
|
||||||||
2014
|
$
|
23,391
|
|
$
|
5,596
|
|
$
|
237
|
|
2015
|
23,645
|
|
5,584
|
|
230
|
|
|||
2016
|
23,911
|
|
5,583
|
|
221
|
|
|||
2017
|
24,439
|
|
5,543
|
|
211
|
|
|||
2018
|
24,814
|
|
5,483
|
|
200
|
|
|||
2019 - 2023
|
130,026
|
|
26,038
|
|
823
|
|
•
|
Assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers
|
•
|
If a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers
|
•
|
If the Company chooses to stop participating in some of its multiemployer plans, the Company may be required to pay those plans an amount based on the underfunded status of the plan, referred to as a withdrawal liability
|
|
EIN/Pension Plan Number
|
Pension Protection Act Zone Status
|
FIP/RP Status Pending/Implemented
|
Contributions
|
Surcharge Imposed
|
Expiration Date of Collective Bargaining Agreement
|
|||||||||||
Pension Fund
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
2011
|
|
|||||||
|
|
|
|
|
(In thousands)
|
|
|
||||||||||
Edison Pension Plan
|
93-6061681-001
|
Green as of 12/31/2013
|
Green as of 12/31/2012
|
No
|
$
|
6,358
|
|
$
|
5,171
|
|
$
|
2,700
|
|
No
|
12/31/2014
|
||
IBEW Local 38 Pension Plan
|
34-6574238-001
|
Yellow as of 4/30/2013
|
Yellow as of 4/30/2012
|
Implemented
|
1,041
|
|
2,771
|
|
1,469
|
|
No
|
4/27/2014
|
|||||
IBEW Local No. 82 Pension Plan
|
31-6127268-001
|
Red as of 6/30/2013
|
Red as of 6/30/2012
|
Implemented
|
1,284
|
|
1,093
|
|
1,331
|
|
No
|
11/30/2014
|
|||||
IBEW Local 648 Pension Plan
|
31-6134845-001
|
Red as of 2/28/2013
|
Red as of 2/29/2012
|
Implemented
|
1,489
|
|
564
|
|
722
|
|
No
|
8/31/2015
|
|||||
Laborers Pension Trust Fund for Northern California
|
94-6277608-001
|
Yellow as of 5/31/2013
|
Yellow as of 5/31/2012
|
Implemented
|
921
|
|
567
|
|
628
|
|
No
|
6/30/2016
|
|||||
National Electrical Benefit Fund
|
53-0181657-001
|
Green
|
Green
|
No
|
5,883
|
|
5,603
|
|
4,841
|
|
No
|
5/31/2012*–
8/31/2017 |
|||||
OE Pension Trust Fund
|
94-6090764-001
|
Yellow
|
Yellow as of 12/31/2012
|
Implemented
|
1,510
|
|
1,156
|
|
1,367
|
|
No
|
6/30/2013*–
3/31/2016 |
|||||
Operating Engineers Local 800 & WY Contractors Association, Inc. Pension Plan for Wyoming
|
83-6011320-001
|
Red as of 12/31/2013
|
Red as of 12/31/2012
|
Implemented
|
76
|
|
91
|
|
96
|
|
No
|
10/31/2005*
|
|||||
Operating Engineers Pension Trust
|
95-6032478-001
|
Red as of 6/30/2013
|
Red as of 6/30/2012
|
Implemented
|
493
|
|
761
|
|
458
|
|
No
|
7/1/2013*–
7/20/2014 |
|||||
Pension and Retirement Plan of Plumbers and Pipefitters Union Local No. 525
|
88-6003864-001
|
Green as of 6/30/2012
|
Green as of 6/30/2011
|
No
|
1,657
|
|
1,202
|
|
759
|
|
No
|
5/31/2010*
|
|||||
Sheet Metal Workers' Pension Plan of Southern CA, AZ and NV
|
95-6052257-001
|
Red as of 12/31/2013
|
Red as of 12/31/2012
|
Implemented
|
512
|
|
467
|
|
336
|
|
No
|
6/30/2014
|
|||||
Other funds
|
|
|
|
|
18,036
|
|
15,333
|
|
14,451
|
|
|
|
|||||
Total contributions
|
$
|
39,260
|
|
$
|
34,779
|
|
$
|
29,158
|
|
|
|
Pension Fund
|
Year Contributions to Plan Exceeded More Than 5 Percent of Total Contributions (as of December 31 of the Plan's Year-End)
|
Edison Pension Plan
|
2012 and 2011
|
IBEW Local 38 Pension Plan
|
2012 and 2011
|
IBEW Local No. 82 Pension Plan
|
2012 and 2011
|
Local Union No. 124 IBEW Pension Trust Fund
|
2012 and 2011
|
Local Union 212 IBEW Pension Trust Fund
|
2012 and 2011
|
IBEW Local Union No. 357 Pension Plan A
|
2012 and 2011
|
IBEW Local 648 Pension Plan
|
2012 and 2011
|
Idaho Plumbers and Pipefitters Pension Plan
|
2012 and 2011
|
Minnesota Teamsters Construction Division Pension Fund
|
2012 and 2011
|
Operating Engineers Local 800 & WY Contractors Association, Inc. Pension Plan for Wyoming
|
2012 and 2011
|
Pension and Retirement Plan of Plumbers and Pipefitters Union Local No. 525
|
2012 and 2011
|
|
2013
|
|
2012
|
|
||
|
(In thousands)
|
|||||
Big Stone Station:
|
|
|
||||
Utility plant in service
|
$
|
63,890
|
|
$
|
63,146
|
|
Less accumulated depreciation
|
41,323
|
|
40,859
|
|
||
|
$
|
22,567
|
|
$
|
22,287
|
|
Coyote Station:
|
|
|
|
|
||
Utility plant in service
|
$
|
138,261
|
|
$
|
135,073
|
|
Less accumulated depreciation
|
89,528
|
|
87,524
|
|
||
|
$
|
48,733
|
|
$
|
47,549
|
|
Wygen III:
|
|
|
|
|
||
Utility plant in service
|
$
|
64,332
|
|
$
|
63,462
|
|
Less accumulated depreciation
|
4,639
|
|
3,368
|
|
||
|
$
|
59,693
|
|
$
|
60,094
|
|
|
2013
|
|
|
|
(In thousands)
|
|
|
Assets
|
|
||
Current assets:
|
|
||
Cash and cash equivalents
|
$
|
4,774
|
|
Other current assets
|
26
|
|
|
Total current assets
|
4,800
|
|
|
Net property, plant and equipment
|
172,073
|
|
|
Total assets
|
$
|
176,873
|
|
Liabilities
|
|
||
Current liabilities:
|
|
||
Long-term debt due within one year
|
$
|
3,000
|
|
Accounts payable
|
8,904
|
|
|
Taxes payable
|
5
|
|
|
Accrued compensation
|
26
|
|
|
Other accrued liabilities
|
461
|
|
|
Total current liabilities
|
12,396
|
|
|
Long-term debt
|
72,000
|
|
|
Total liabilities
|
$
|
84,396
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
||||
|
(In thousands, except per share amounts)
|
|||||||||||
2013
|
|
|
|
|
||||||||
Operating revenues
|
$
|
931,604
|
|
$
|
1,060,595
|
|
$
|
1,285,782
|
|
$
|
1,184,423
|
|
Operating expenses
|
827,073
|
|
969,217
|
|
1,135,909
|
|
1,037,306
|
|
||||
Operating income
|
104,531
|
|
91,378
|
|
149,873
|
|
147,117
|
|
||||
Income from continuing operations
|
56,592
|
|
46,392
|
|
84,550
|
|
91,348
|
|
||||
Loss from discontinued operations, net of tax
|
(77
|
)
|
(59
|
)
|
(118
|
)
|
(58
|
)
|
||||
Net income attributable to the Company
|
56,515
|
|
46,512
|
|
84,456
|
|
91,450
|
|
||||
Earnings per common share - basic:
|
|
|
|
|
|
|
|
|||||
Earnings before discontinued operations
|
.30
|
|
.25
|
|
.45
|
|
.48
|
|
||||
Discontinued operations, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
||||
Earnings per common share - basic
|
.30
|
|
.25
|
|
.45
|
|
.48
|
|
||||
Earnings per common share - diluted:
|
|
|
|
|
|
|
|
|||||
Earnings before discontinued operations
|
.30
|
|
.24
|
|
.44
|
|
.48
|
|
||||
Discontinued operations, net of tax
|
—
|
|
—
|
|
—
|
|
—
|
|
||||
Earnings per common share - diluted
|
.30
|
|
.24
|
|
.44
|
|
.48
|
|
||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|||||
Basic
|
188,831
|
|
188,831
|
|
188,831
|
|
188,929
|
|
||||
Diluted
|
189,222
|
|
189,463
|
|
189,638
|
|
189,766
|
|
||||
|
|
|
|
|
||||||||
2012
|
|
|
|
|
|
|
|
|
||||
Operating revenues
|
$
|
852,807
|
|
$
|
967,962
|
|
$
|
1,173,518
|
|
$
|
1,081,144
|
|
Operating expenses
|
781,750
|
|
876,248
|
|
1,207,553
|
|
1,190,673
|
|
||||
Operating income (loss)
|
71,057
|
|
91,714
|
|
(34,035
|
)
|
(109,529
|
)
|
||||
Income (loss) from continuing operations
|
35,890
|
|
49,007
|
|
(29,532
|
)
|
(69,686
|
)
|
||||
Income (loss) from discontinued operations, net of tax
|
(100
|
)
|
5,106
|
|
(139
|
)
|
8,700
|
|
||||
Net income (loss) attributable to the Company
|
35,790
|
|
54,113
|
|
(29,671
|
)
|
(60,986
|
)
|
||||
Earnings per common share - basic:
|
|
|
|
|
|
|
|
|
||||
Earnings (loss) before discontinued operations
|
.19
|
|
.26
|
|
(.16
|
)
|
(.37
|
)
|
||||
Discontinued operations, net of tax
|
—
|
|
.03
|
|
—
|
|
.05
|
|
||||
Earnings (loss) per common share - basic
|
.19
|
|
.29
|
|
(.16
|
)
|
(.32
|
)
|
||||
Earnings (loss) per common share - diluted:
|
|
|
|
|
|
|
|
|
||||
Earnings (loss) before discontinued operations
|
.19
|
|
.26
|
|
(.16
|
)
|
(.37
|
)
|
||||
Discontinued operations, net of tax
|
—
|
|
.03
|
|
—
|
|
.05
|
|
||||
Earnings (loss) per common share - diluted
|
.19
|
|
.29
|
|
(.16
|
)
|
(.32
|
)
|
||||
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
||||
Basic
|
188,811
|
|
188,831
|
|
188,831
|
|
188,831
|
|
||||
Diluted
|
189,182
|
|
189,107
|
|
188,831
|
|
188,831
|
|
•
|
First quarter 2013 reflects an unrealized loss on commodity derivatives of
$3.7 million
(after tax). First quarter 2012 reflects an unrealized loss on commodity derivatives of
$2.6 million
(after tax).
|
•
|
Second quarter 2013 reflects an impairment of coalbed natural gas gathering assets of
$9.0 million
(after tax) and an unrealized gain on commodity derivatives of
$8.2 million
(after tax). Second quarter 2012 reflects a net benefit of
$15.0 million
(after tax) related to natural gas gathering operations litigation, a net benefit largely related to estimated insurance recoveries related to the guarantee of a construction contract (reflected in income (loss) from discontinued
|
•
|
Third quarter 2013 reflects an unrealized loss on commodity derivatives of
$7.9 million
(after tax). Third quarter 2012 reflects a
$100.9 million
(after tax) noncash write-down of oil and natural gas properties and an unrealized loss on commodity derivatives of
$700,000
(after tax). For more information, see Note 1.
|
•
|
Fourth quarter 2013 reflects a net benefit of
$1.5 million
(after tax) related to natural gas gathering operations litigation and an unrealized loss on commodity derivatives of
$500,000
(after tax). Fourth quarter 2012 reflects a
$145.9 million
(after tax) noncash write-down of oil and natural gas properties, the reversal of an arbitration charge of
$13.0 million
(after tax) related to a guarantee of a construction contract, which was partially offset by the reversal of estimated insurance recoveries (reflected in income (loss) from discontinued operations), as well as an unrealized loss on commodity derivatives of
$200,000
(after tax). For more information, see Notes 1 and 19.
|
Years ended December 31,
|
2013
|
|
*
|
2012
|
|
*
|
2011
|
|
*
|
|||
|
(In thousands)
|
|
||||||||||
Acquisitions:
|
|
|
|
|
|
|
|
|
|
|||
Proved properties
|
$
|
1,817
|
|
|
$
|
839
|
|
|
$
|
3,999
|
|
|
Unproved properties
|
4,608
|
|
|
31,109
|
|
|
63,354
|
|
|
|||
Exploration
|
26,975
|
|
|
235,906
|
|
|
41,775
|
|
|
|||
Development
|
355,421
|
|
|
275,959
|
|
|
161,647
|
|
|
|||
Total capital expenditures
|
$
|
388,821
|
|
|
$
|
543,813
|
|
|
$
|
270,775
|
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Revenues:
|
|
|
|
||||||
Sales to affiliates
|
$
|
45,099
|
|
$
|
35,966
|
|
$
|
93,713
|
|
Sales to external customers
|
497,018
|
|
379,647
|
|
348,428
|
|
|||
Realized gain on commodity derivatives
|
173
|
|
33,628
|
|
9,618
|
|
|||
Unrealized gain (loss) on commodity derivatives
|
(6,267
|
)
|
(624
|
)
|
1,827
|
|
|||
Production costs
|
144,136
|
|
134,795
|
|
140,606
|
|
|||
Depreciation, depletion and amortization*
|
182,352
|
|
157,078
|
|
139,539
|
|
|||
Write-downs of oil and natural gas properties
|
—
|
|
391,800
|
|
—
|
|
|||
Pretax income (loss)
|
209,535
|
|
(235,056
|
)
|
173,441
|
|
|||
Income tax expense (benefit)
|
75,836
|
|
(88,612
|
)
|
63,655
|
|
|||
Results of operations for producing activities
|
$
|
133,699
|
|
$
|
(146,444
|
)
|
$
|
109,786
|
|
•
|
Extensions and discoveries of
19.1
MMBOE, primarily due to drilling activity and new PUD locations at the Company's Bakken and Paradox Basin properties, as well as new PUD locations at Big Horn and East Texas
|
•
|
Sales of proved reserves of
(8.0)
MMBOE, primarily at the Company's Green River Basin property
|
•
|
Extension and discoveries of
14.8
MMBOE primarily due to drilling activity at the Company's Bakken, South Texas and Paradox properties
|
•
|
Revisions of previous estimates of
(21.4)
MMBOE, largely the result of lower natural gas prices resulting in a reduction of PDP and PUD reserves principally in the Company's Coalbed, Baker, Bowdoin, East Texas and Green River Basin natural gas properties
|
•
|
Extensions and discoveries of
10.8
MMBOE primarily due to drilling activity at the Company's Bakken and Big Horn properties
|
•
|
Revisions of previous estimates of
(9.9)
MMBOE, largely the result of a reduction in PUD reserves of
8.9
MMBOE resulting principally in the Company's Bowdoin, Baker, Coalbed, East Texas and Big Horn Basin properties. The remaining negative revisions were a reduction in PDP natural gas reserves.
|
|
2013
|
|
2012
|
|
2011
|
|
Proved developed reserves:
|
|
|
|
|||
Oil (MBbls)
|
31,394
|
|
27,412
|
|
23,653
|
|
NGL (MBbls)
|
5,322
|
|
5,342
|
|
5,225
|
|
Natural Gas (MMcf)
|
176,546
|
|
218,259
|
|
303,495
|
|
Total (MBOE)
|
66,140
|
|
69,131
|
|
79,460
|
|
PUD reserves:
|
|
|
|
|||
Oil (MBbls)
|
9,625
|
|
6,041
|
|
3,352
|
|
NGL (MBbls)
|
1,280
|
|
1,811
|
|
2,117
|
|
Natural Gas (MMcf)
|
21,899
|
|
21,019
|
|
76,332
|
|
Total (MBOE)
|
14,555
|
|
11,355
|
|
18,191
|
|
Total proved reserves:
|
|
|
|
|||
Oil (MBbls)
|
41,019
|
|
33,453
|
|
27,005
|
|
NGL (MBbls)
|
6,602
|
|
7,153
|
|
7,342
|
|
Natural Gas (MMcf)
|
198,445
|
|
239,278
|
|
379,827
|
|
Total (MBOE)
|
80,695
|
|
80,486
|
|
97,651
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Future cash inflows
|
$
|
4,507,000
|
|
$
|
3,696,200
|
|
$
|
4,188,000
|
|
Future production costs
|
1,734,800
|
|
1,536,500
|
|
1,560,300
|
|
|||
Future development costs
|
403,000
|
|
301,600
|
|
285,300
|
|
|||
Future net cash flows before income taxes
|
2,369,200
|
|
1,858,100
|
|
2,342,400
|
|
|||
Future income tax expense
|
545,200
|
|
304,900
|
|
531,100
|
|
|||
Future net cash flows
|
1,824,000
|
|
1,553,200
|
|
1,811,300
|
|
|||
10% annual discount for estimated timing of cash flows
|
810,000
|
|
669,800
|
|
832,500
|
|
|||
Discounted future net cash flows relating to proved oil, NGL and natural gas reserves
|
$
|
1,014,000
|
|
$
|
883,400
|
|
$
|
978,800
|
|
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Beginning of year
|
$
|
883,400
|
|
$
|
978,800
|
|
$
|
896,100
|
|
Net revenues from production
|
(398,000
|
)
|
(280,800
|
)
|
(301,500
|
)
|
|||
Net change in sales prices and production costs related to future production
|
162,200
|
|
(406,300
|
)
|
82,300
|
|
|||
Extensions and discoveries, net of future production-related costs
|
366,500
|
|
355,300
|
|
226,300
|
|
|||
Improved recovery, net of future production-related costs
|
—
|
|
—
|
|
—
|
|
|||
Purchases of proved reserves, net of future production-related costs
|
—
|
|
—
|
|
9,500
|
|
|||
Sales of proved reserves
|
(37,800
|
)
|
(2,600
|
)
|
—
|
|
|||
Changes in estimated future development costs
|
6,700
|
|
37,600
|
|
51,100
|
|
|||
Development costs incurred during the current year
|
141,500
|
|
77,700
|
|
56,300
|
|
|||
Accretion of discount
|
94,600
|
|
121,400
|
|
105,000
|
|
|||
Net change in income taxes
|
(141,400
|
)
|
110,000
|
|
(55,800
|
)
|
|||
Revisions of previous estimates
|
(55,800
|
)
|
(100,700
|
)
|
(92,900
|
)
|
|||
Other
|
(7,900
|
)
|
(7,000
|
)
|
2,400
|
|
|||
Net change
|
130,600
|
|
(95,400
|
)
|
82,700
|
|
|||
End of year
|
$
|
1,014,000
|
|
$
|
883,400
|
|
$
|
978,800
|
|
Item 9.
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Plan Category
|
(a)
Number of securities to be issued upon exercise of outstanding options, warrants and rights
|
|
|
(b)
Weighted average exercise price of outstanding options, warrants and rights
|
|
(c)
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
|
|
|
Equity compensation plans approved by stockholders (1)
|
749,991
|
|
(2)
|
$
|
21.99
|
|
6,176,556
|
|
(3)(4)
|
Equity compensation plans not approved by stockholders
|
N/A
|
|
|
N/A
|
|
N/A
|
|
|
|
(1) Consists of the Non-Employee Director Long-Term Incentive Compensation Plan, the Long-Term Performance-Based Incentive Plan and the Non-Employee Director Stock Compensation Plan.
|
|||||||||
(2) Consists of performance shares.
|
|||||||||
(3) 357,757 shares remain available for future issuance under the Non-Employee Director Long-Term Incentive Compensation Plan in connection with grants of restricted stock, performance units, performance shares or other equity-based awards. 5,643,041 shares under the Long-Term Performance-Based Incentive Plan remain available for future issuance in connection with grants of restricted stock, performance units, performance shares or other equity-based awards.
|
|||||||||
(4) This amount also includes 175,758 shares available for issuance under the Non-Employee Director Stock Compensation Plan. Under this plan, in addition to a cash retainer, non-employee directors are awarded shares equal in value to $110,000 annually. A non-employee director may acquire additional shares under the plan in lieu of receiving the cash portion of the director's retainer or fees.
|
(a) Financial Statements, Financial Statement Schedules and Exhibits
|
1. Financial Statements
|
|
The following consolidated financial statements required under this item are included under Item 8 - Financial Statements and Supplementary Data.
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
2. Financial Statement Schedules
The following financial statement schedules are included in Part IV of this report.
|
Page
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Operating revenues
|
$
|
549,239
|
|
$
|
472,302
|
|
$
|
518,268
|
|
Operating expenses
|
473,917
|
|
405,095
|
|
450,579
|
|
|||
Operating income
|
75,322
|
|
67,207
|
|
67,689
|
|
|||
Other income
|
3,709
|
|
3,925
|
|
2,710
|
|
|||
Interest expense
|
17,386
|
|
17,297
|
|
18,660
|
|
|||
Income before income taxes
|
61,645
|
|
53,835
|
|
51,739
|
|
|||
Income taxes
|
13,520
|
|
11,798
|
|
10,476
|
|
|||
Equity in earnings (loss) of subsidiaries
|
230,808
|
|
(42,791
|
)
|
171,763
|
|
|||
Net income (loss) attributable to the Company
|
278,933
|
|
(754
|
)
|
213,026
|
|
|||
Dividends declared on preferred stocks
|
685
|
|
685
|
|
685
|
|
|||
Earnings (loss) on common stock
|
$
|
278,248
|
|
$
|
(1,439
|
)
|
$
|
212,341
|
|
Comprehensive income (loss)
|
$
|
289,449
|
|
$
|
(2,474
|
)
|
$
|
197,286
|
|
December 31,
|
2013
|
|
2012
|
|
||
(In thousands, except shares and per share amounts)
|
|
|||||
Assets
|
|
|
||||
Current assets:
|
|
|
||||
Cash and cash equivalents
|
$
|
5,051
|
|
$
|
3,596
|
|
Receivables, net
|
88,529
|
|
89,238
|
|
||
Accounts receivable from subsidiaries
|
31,372
|
|
2,957
|
|
||
Inventories
|
29,312
|
|
41,469
|
|
||
Deferred income taxes
|
3,196
|
|
3,685
|
|
||
Prepayments and other current assets
|
14,231
|
|
9,120
|
|
||
Total current assets
|
171,691
|
|
150,065
|
|
||
Investments
|
60,687
|
|
52,123
|
|
||
Investment in subsidiaries
|
2,380,829
|
|
2,253,294
|
|
||
Property, plant and equipment
|
1,785,861
|
|
1,581,776
|
|
||
Less accumulated depreciation, depletion and amortization
|
660,693
|
|
621,623
|
|
||
Net property, plant and equipment
|
1,125,168
|
|
960,153
|
|
||
Deferred charges and other assets:
|
|
|
||||
Goodwill
|
4,812
|
|
4,812
|
|
||
Other
|
121,253
|
|
155,483
|
|
||
Total deferred charges and other assets
|
126,065
|
|
160,295
|
|
||
Total assets
|
$
|
3,864,440
|
|
$
|
3,575,930
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
||||
Current liabilities:
|
|
|
||||
Long-term debt due within one year
|
$
|
109
|
|
$
|
108
|
|
Accounts payable
|
45,282
|
|
42,149
|
|
||
Accounts payable to subsidiaries
|
4,839
|
|
6,423
|
|
||
Taxes payable
|
12,337
|
|
12,399
|
|
||
Dividends payable
|
33,737
|
|
171
|
|
||
Accrued compensation
|
16,076
|
|
10,282
|
|
||
Other accrued liabilities
|
28,042
|
|
29,490
|
|
||
Total current liabilities
|
140,422
|
|
101,022
|
|
||
Long-term debt
|
434,598
|
|
356,760
|
|
||
Deferred credits and other liabilities:
|
|
|
||||
Deferred income taxes
|
205,639
|
|
172,769
|
|
||
Other liabilities
|
260,617
|
|
297,131
|
|
||
Total deferred credits and other liabilities
|
466,256
|
|
469,900
|
|
||
Commitments and contingencies
|
|
|
|
|
||
Stockholders' equity:
|
|
|
|
|
||
Preferred stocks
|
15,000
|
|
15,000
|
|
||
Common stockholders' equity:
|
|
|
|
|
||
Common stock
|
|
|
|
|
||
Authorized - 500,000,000 shares, $1.00 par value
|
|
|
|
|||
Issued - 189,868,780 shares in 2013 and 189,369,450 shares in 2012
|
189,869
|
|
189,369
|
|
||
Other paid-in capital
|
1,056,996
|
|
1,039,080
|
|
||
Retained earnings
|
1,603,130
|
|
1,457,146
|
|
||
Accumulated other comprehensive loss
|
(38,205
|
)
|
(48,721
|
)
|
||
Treasury stock at cost - 538,921 shares
|
(3,626
|
)
|
(3,626
|
)
|
||
Total common stockholders' equity
|
2,808,164
|
|
2,633,248
|
|
||
Total stockholders' equity
|
2,823,164
|
|
2,648,248
|
|
||
Total liabilities and stockholders' equity
|
$
|
3,864,440
|
|
$
|
3,575,930
|
|
Years ended December 31,
|
2013
|
|
2012
|
|
2011
|
|
|||
|
(In thousands)
|
||||||||
Net cash provided by operating activities
|
$
|
188,259
|
|
$
|
225,968
|
|
$
|
217,514
|
|
Investing activities:
|
|
|
|
|
|
||||
Capital expenditures
|
(211,013
|
)
|
(150,337
|
)
|
(74,580
|
)
|
|||
Net proceeds from sale or disposition of property and other
|
20,624
|
|
1,120
|
|
720
|
|
|||
Investments in and advances to subsidiaries
|
(1,016
|
)
|
(1,387
|
)
|
(5,701
|
)
|
|||
Investments from and advances from subsidiaries
|
10,000
|
|
5,000
|
|
—
|
|
|||
Investments
|
613
|
|
12
|
|
—
|
|
|||
Net cash used in investing activities
|
(180,792
|
)
|
(145,592
|
)
|
(79,561
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||
Repayment of short-term borrowings
|
—
|
|
—
|
|
(20,000
|
)
|
|||
Issuance of long-term debt
|
77,924
|
|
76,000
|
|
—
|
|
|||
Repayment of long-term debt
|
(85
|
)
|
(21
|
)
|
(107
|
)
|
|||
Proceeds from issuance of common stock
|
14,554
|
|
88
|
|
5,744
|
|
|||
Dividends paid
|
(98,405
|
)
|
(159,768
|
)
|
(123,323
|
)
|
|||
Excess tax benefit on stock-based compensation
|
—
|
|
21
|
|
358
|
|
|||
Net cash used in financing activities
|
(6,012
|
)
|
(83,680
|
)
|
(137,328
|
)
|
|||
Increase (decrease) in cash and cash equivalents
|
1,455
|
|
(3,304
|
)
|
625
|
|
|||
Cash and cash equivalents - beginning of year
|
3,596
|
|
6,900
|
|
6,275
|
|
|||
Cash and cash equivalents - end of year
|
$
|
5,051
|
|
$
|
3,596
|
|
$
|
6,900
|
|
For the years ended December 31, 2013, 2012 and 2011
|
|||||||||||||||||
|
|
Additions
|
|
|
|
||||||||||||
Description
|
Balance at Beginning of Year
|
|
Charged to Costs and Expenses
|
|
Other
|
|
*
|
Deductions
|
|
**
|
Balance at End of Year
|
|
|||||
|
(In thousands)
|
||||||||||||||||
Allowance for doubtful accounts:
|
|
|
|
|
|
|
|||||||||||
2013
|
$
|
10,818
|
|
$
|
5,725
|
|
$
|
1,395
|
|
|
$
|
7,853
|
|
|
$
|
10,085
|
|
2012
|
12,407
|
|
7,064
|
|
1,754
|
|
|
10,407
|
|
|
10,818
|
|
|||||
2011
|
15,284
|
|
3,977
|
|
2,112
|
|
|
8,966
|
|
|
12,407
|
|
3(a)
|
Restated Certificate of Incorporation of the Company, as amended, dated May 13, 2010, filed as Exhibit 3(a) to Form 10-Q for the quarter ended September 30, 2010, filed on November 3, 2010, in File No. 1-3480*
|
|
|
3(b)
|
Company Bylaws, as amended and restated, on March 4, 2013, filed as Exhibit 3 to Form 10-Q for the quarter ended March 31, 2013, filed on May 7, 2013, in File No. 1-3480*
|
|
|
4(a)
|
Indenture, dated as of December 15, 2003, between the Company and The Bank of New York, as trustee, filed as Exhibit 4(f) to Form S-8 on January 21, 2004, in Registration No. 333-112035*
|
|
|
4(b)
|
First Supplemental Indenture, dated as of November 17, 2009, between the Company and The Bank of New York Mellon, as trustee, filed as Exhibit 4(c) to Form 10-K for the year ended December 31, 2009, filed on February 17, 2010, in File No. 1-3480*
|
|
|
4(c)
|
Centennial Energy Holdings, Inc. Master Shelf Agreement, dated April 29, 2005, among Centennial Energy Holdings, Inc. and the Prudential Insurance Company of America, filed as Exhibit 4(a) to Form 10-Q for the quarter ended June 30, 2005, filed on August 3, 2005, in File No. 1-3480*
|
|
|
4(d)
|
Letter Amendment No. 1 to Amended and Restated Master Shelf Agreement, dated May 17, 2006, among Centennial Energy Holdings, Inc., the Prudential Insurance Company of America, and certain investors described in the Letter Amendment, filed as Exhibit 4(a) to Form 10-Q for the quarter ended June 30, 2006, filed on August 4, 2006, in File No. 1-3480*
|
|
|
4(e)
|
MDU Resources Group, Inc. Credit Agreement, dated May 26, 2011, among MDU Resources Group, Inc., Various Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, filed as Exhibit 4(e) to Form 10-K for the year ended December 31, 2011, filed on February 24, 2012, in File No. 1-3480*
|
|
|
4(f)
|
First Amendment to Credit Agreement, dated October 4, 2012, among MDU Resources Group, Inc., Various Lenders, and Wells Fargo Bank, National Association, as Administrative Agent, filed as Exhibit 4 to Form 10-Q for the quarter ended September 30, 2012, filed on November 7, 2012, in File No. 1-3480*
|
|
|
4(g)
|
Centennial Energy Holdings, Inc. Credit Agreement, dated June 8, 2012, among Centennial Energy Holdings, Inc., U.S. Bank National Association, as Administrative Agent, and The Other Financial Institutions party thereto, filed as Exhibit 4 to Form 10-Q for the quarter ended June 30, 2012, filed on August 7, 2012, in File No. 1-3480*
|
|
|
4(h)
|
MDU Energy Capital, LLC Master Shelf Agreement, dated as of August 9, 2007, among MDU Energy Capital, LLC and the Prudential Insurance Company of America, filed as Exhibit 4 to Form 8-K dated August 16, 2007, filed on August 16, 2007, in File No. 1-3480*
|
|
|
4(i)
|
Amendment No. 1 to Master Shelf Agreement, dated October 1, 2008, among MDU Energy Capital, LLC, Prudential Investment Management, Inc., the Prudential Insurance Company of America, and the holders of the notes thereunder, filed as Exhibit 4(b) to Form 10-Q for the quarter ended September 30, 2008, filed on November 5, 2008, in File No. 1-3480*
|
|
|
4(j)
|
Indenture dated as of August 1, 1992, between Cascade Natural Gas Corporation and The Bank of New York relating to Medium-Term Notes, filed by Cascade Natural Gas Corporation as Exhibit 4 to Form 8-K dated August 12, 1992, in File No. 1-7196*
|
|
|
4(k)
|
First Supplemental Indenture dated as of October 25, 1993, between Cascade Natural Gas Corporation and The Bank of New York relating to Medium-Term Notes and the 7.5% Notes due November 15, 2031, filed by Cascade Natural Gas Corporation as Exhibit 4 to Form 10-Q for the quarter ended June 30, 1993, in File No. 1-7196*
|
|
|
4(l)
|
Second Supplemental Indenture, dated January 25, 2005, between Cascade Natural Gas Corporation and The Bank of New York, as trustee, filed by Cascade Natural Gas Corporation as Exhibit 4.1 to Form 8-K dated January 25, 2005, filed on January 26, 2005, in File No. 1-7196*
|
|
|
4(m)
|
Third Supplemental Indenture dated as of March 8, 2007, between Cascade Natural Gas Corporation and The Bank of New York Trust Company, N.A., as Successor Trustee, filed by Cascade Natural Gas Corporation as Exhibit 4.1 to Form 8-K dated March 8, 2007, filed on March 8, 2007, in File No. 1-7196*
|
|
|
+10(a)
|
Supplemental Income Security Plan, as amended and restated November 12, 2009, filed as Exhibit 10(b) to Form 10-K for the year ended December 31, 2009, filed on February 17, 2010, in File No. 1-3480*
|
|
|
+10(b)
|
Director Compensation Policy, as amended May 16, 2013, filed as Exhibit 10(a) to Form 10-Q for the quarter ended June 30, 2013, filed on August 7, 2013, in File No. 1-3480*
|
|
|
+10(c)
|
Deferred Compensation Plan for Directors, as amended May 15, 2008, filed as Exhibit 10(a) to Form 10-Q for the quarter ended June 30, 2008, filed on August 7, 2008, in File No. 1-3480*
|
|
|
+10(d)
|
Non-Employee Director Stock Compensation Plan, as amended May 12, 2011, filed as Exhibit 10(a) to Form 10-Q for the quarter ended June 30, 2011, filed on August 5, 2011, in File No. 1-3480*
|
|
|
+10(e)
|
MDU Resources Group, Inc. Non-Employee Director Long-Term Incentive Compensation Plan, as amended May 17, 2012, filed as Exhibit 10(a) to Form 10-Q for the quarter ended June 30, 2012, filed on August 7, 2012, in File No. 1-3480*
|
|
|
+10(f)
|
Long-Term Performance-Based Incentive Plan, as amended November 17, 2011, filed as Exhibit 10(h) to Form 10-K for the year ended December 31, 2011, filed on February 24, 2012, in File No. 1-3480*
|
|
|
+10(g)
|
MDU Resources Group, Inc. Executive Incentive Compensation Plan, as amended March 4, 2013, and Rules and Regulations, as amended March 4, 2013, filed as Exhibit 10(a) to Form 10-Q for the quarter ended March 31, 2013, filed on May 7, 2013, in File No. 1-3480*
|
|
|
+10(h)
|
Supplemental Executive Retirement Plan for John G. Harp, dated December 4, 2006, filed as Exhibit 10(ag) to Form 10-K for the year ended December 31, 2006, filed on February 21, 2007, in File No. 1-3480*
|
|
|
+10(i)
|
Form of Performance Share Award Agreement under the Long-Term Performance-Based Incentive Plan, as amended November 14, 2012, filed as Exhibit 10.1 to Form 8-K dated November 14, 2012, filed on November 20, 2012, in File No. 1-3480*
|
|
|
+10(j)
|
Form of Annual Incentive Award Agreement under the Long-Term Performance-Based Incentive Plan as amended March 4, 2013, filed as Exhibit 10.2 to Form 8-K dated March 4, 2013, filed on March 7, 2013, in File No. 1-3480*
|
|
|
+10(k)
|
Form of MDU Resources Group, Inc. Indemnification Agreement for Section 16 Officers and Directors, filed as Exhibit 10.1 to Form 8-K dated August 12, 2010, filed on August 17, 2010, in File No. 1-3480*
|
|
|
+10(l)
|
MDU Resources Group, Inc. Section 16 Officers and Directors with Indemnification Agreements Chart, as of January 3, 2014**
|
|
|
+10(m)
|
Employment Letter for J. Kent Wells, dated March 9, 2011, filed as Exhibit 10(v) to Form 10-K for the year ended December 31, 2011, filed on February 24, 2012, in File No. 1-3480*
|
|
|
+10(n)
|
MDU Resources Group, Inc. Nonqualified Defined Contribution Plan, as adopted November 17, 2011, filed as Exhibit 10(x) to Form 10-K for the year ended December 31, 2011, filed on February 24, 2012, in File No. 1-3480*
|
|
|
+10(o)
|
MDU Resources Group, Inc. 401(k) Retirement Plan, as restated March 1, 2011, filed as Exhibit 10(a) to Form 10-Q for the quarter ended September 30, 2011, filed on November 4, 2011, in File No. 1-3480*
|
|
|
+10(p)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated March 29, 2011, filed as Exhibit 10(b) to Form 10-Q for the quarter ended March 31, 2011, filed on May 5, 2011, in File No. 1-3480*
|
|
|
+10(q)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated June 30, 2011, filed as Exhibit 10(d) to Form 10-Q for the quarter ended June 30, 2011, filed on August 5, 2011, in File No. 1-3480*
|
|
|
+10(r)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated September 9, 2011, filed as Exhibit 10(b) to Form 10-Q for the quarter ended September 30, 2011, filed on November 4, 2011, in File No. 1-3480*
|
|
|
+10(s)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated December 29, 2011, filed as Exhibit 10(ac) to Form 10-K for the year ended December 31, 2011, filed on February 24, 2012, in File No. 1-3480*
|
|
|
+10(t)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated May 24, 2012, filed as Exhibit 10(b) to Form 10-Q for the quarter ended June 30, 2012, filed on August 7, 2012, in File No. 1-3480*
|
|
|
+10(u)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated August 29, 2012, filed as Exhibit 10(a) to Form 10-Q for the quarter ended September 30, 2012, filed on November 7, 2012, in File No. 1-3480*
|
|
|
+10(v)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated August 29, 2012, filed as Exhibit 10(b) to Form 10-Q for the quarter ended September 30, 2012, filed on November 7, 2012, in File No. 1-3480*
|
|
|
+10(w)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated December 19, 2012, filed as Exhibit 10(z) to Form 10-K for the year ended December 31, 2012, filed on February 28, 2013, in File No. 1-3480*
|
|
|
+10(x)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated September 9, 2013, filed as Exhibit 10(b) to Form 10-Q for the quarter ended September 30, 2013, filed on November 7, 2013, in File No. 1-3480*
|
|
|
+10(y)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated September 9, 2013, filed as Exhibit 10(c) to Form 10-Q for the quarter ended September 30, 2013, filed on November 7, 2013, in File No. 1-3480*
|
|
|
+10(z)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated September 23, 2013, filed as Exhibit 10(d) to Form 10-Q for the quarter ended September 30, 2013, filed on November 7, 2013, in File No. 1-3480*
|
|
|
+10(aa)
|
Instrument of Amendment to the MDU Resources Group, Inc. 401(k) Retirement Plan, dated December 31, 2013**
|
|
|
+10(ab)
|
Employment Letter for Jeffrey S. Thiede, dated May 16, 2013**
|
|
|
12
|
Computation of Ratio of Earnings to Fixed Charges and Combined Fixed Charges and Preferred Stock Dividends**
|
|
|
21
|
Subsidiaries of MDU Resources Group, Inc.**
|
|
|
23(a)
|
Consent of Independent Registered Public Accounting Firm**
|
|
|
23(b)
|
Consent of Ryder Scott Company, L.P.**
|
|
|
31(a)
|
Certification of Chief Executive Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**
|
|
|
31(b)
|
Certification of Chief Financial Officer filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**
|
|
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**
|
|
|
95
|
Mine Safety Disclosures**
|
|
|
99(a)
|
Ryder Scott Company, L.P. report dated January 27, 2014**
|
|
|
99(b)
|
Equity Distribution Agreement entered into between MDU Resources Group, Inc. and Wells Fargo Securities, LLC, filed as Exhibit 1 to Form 8-K dated May 20, 2013, filed on May 20, 2013, in File No. 1-3480*
|
|
|
99(c)
|
First Amendment to Equity Distribution Agreement, dated December 2, 2013, entered into between MDU Resources Group, Inc. and Wells Fargo Securities, LLC**
|
|
|
101
|
The following materials from MDU Resources Group, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Equity, (v) the Consolidated Statements of Cash Flows, (vi) the Notes to Consolidated Financial Statements, tagged in summary and detail, (vii) Schedule I - Condensed Financial Information of Registrant, tagged in summary and detail and (viii) Schedule II - Consolidated Valuation and Qualifying Accounts, tagged in summary and detail
|
* Incorporated herein by reference as indicated.
|
** Filed herewith.
|
+ Management contract, compensatory plan or arrangement.
|
|
MDU Resources Group, Inc. agrees to furnish to the SEC upon request any instrument with respect to long-term debt that MDU Resources Group, Inc. has not filed as an exhibit pursuant to the exemption provided by Item 601(b)(4)(iii)(A) of Regulation S-K.
|
|
|
MDU Resources Group, Inc.
|
|
|
|
|
|
Date:
|
February 21, 2014
|
By:
|
/s/ David L. Goodin
|
|
|
|
David L. Goodin
(President and Chief Executive Officer)
|
Signature
|
Title
|
Date
|
|
|
|
/s/ David L. Goodin
|
Chief Executive Officer and Director
|
February 21, 2014
|
David L. Goodin
(President and Chief Executive Officer)
|
|
|
|
|
|
/s/ Doran N. Schwartz
|
Chief Financial Officer
|
February 21, 2014
|
Doran N. Schwartz
(Vice President and Chief Financial Officer)
|
|
|
|
|
|
/s/ Nathan W. Ring
|
Chief Accounting Officer
|
February 21, 2014
|
Nathan W. Ring
(Vice President, Controller and Chief Accounting Officer)
|
|
|
|
|
|
/s/ Harry J. Pearce
|
Director
|
February 21, 2014
|
Harry J. Pearce
|
|
|
(Chairman of the Board)
|
|
|
|
|
|
/s/ Thomas Everist
|
Director
|
February 21, 2014
|
Thomas Everist
|
|
|
|
|
|
/s/ Karen B. Fagg
|
Director
|
February 21, 2014
|
Karen B. Fagg
|
|
|
|
|
|
/s/ Mark A. Hellerstein
|
Director
|
February 21, 2014
|
Mark A. Hellerstein
|
|
|
|
|
|
/s/ A. Bart Holaday
|
Director
|
February 21, 2014
|
A. Bart Holaday
|
|
|
|
|
|
/s/ Dennis W. Johnson
|
Director
|
February 21, 2014
|
Dennis W. Johnson
|
|
|
|
|
|
/s/ Thomas C. Knudson
|
Director
|
February 21, 2014
|
Thomas C. Knudson
|
|
|
|
|
|
/s/ William E. McCracken
|
Director
|
February 21, 2014
|
William E. McCracken
|
|
|
|
|
|
/s/ Patricia L. Moss
|
Director
|
February 21, 2014
|
Patricia L. Moss
|
|
|
|
|
|
/s/ J. Kent Wells
|
Director
|
February 21, 2014
|
J. Kent Wells
|
|
|
|
|
|
/s/ John K. Wilson
|
Director
|
February 21, 2014
|
John K. Wilson
|
|
|
Name
|
Title
|
Date of Agreement
|
David L. Goodin
|
President and Chief Executive Officer, MDU Resources Group, Inc.
|
August 12, 2010
|
Steven L. Bietz
|
President and Chief Executive Officer, WBI Holdings, Inc.
|
August 12, 2010
|
William R. Connors
|
Vice President - Renewable Resources, MDU Resources Group, Inc.
|
August 12, 2010
|
Mark A. Del Vecchio
|
Vice President - Human Resources, MDU Resources Group, Inc.
|
August 12, 2010
|
Nicole A. Kivisto
|
Vice President, Controller and Chief Accounting Officer, MDU Resources Group, Inc. until
January 3, 2014
|
August 12, 2010
|
Cynthia J. Norland
|
Vice President - Administration, MDU Resources Group, Inc.
|
August 12, 2010
|
Paul K. Sandness
|
General Counsel and Secretary, MDU Resources Group, Inc.
|
August 12, 2010
|
Doran N. Schwartz
|
Vice President and Chief Financial Officer, MDU Resources Group, Inc.
|
August 12, 2010
|
John P. Stumpf
|
Vice President - Strategic Planning, MDU Resources Group, Inc.
|
August 12, 2010
|
Douglass A. Mahowald
|
Treasurer and Assistant Secretary, MDU Resources Group, Inc.
|
August 12, 2010
|
J. Kent Wells
|
Vice Chairman, MDU Resources Group, Inc.; President and Chief Executive Officer, Fidelity Exploration & Production Company
|
May 2, 2011
|
K. Frank Morehouse
|
President and Chief Executive Officer, Montana-Dakota Utilities Co., Great Plains Natural Gas Co., Cascade Natural Gas Corporation, and Intermountain Gas Company
|
January 4, 2013
|
David C. Barney
|
President and Chief Executive Officer, Knife River Corporation
|
May 16, 2013
|
Jeffrey S. Thiede
|
President and Chief Executive Officer, MDU Construction Services Group, Inc.
|
May 16, 2013
|
Dennis L. Haider
|
Executive Vice President - Business Development, MDU Resources Group, Inc.
|
June 1, 2013
|
Nathan W. Ring
|
Vice President, Controller and Chief Accounting Officer, MDU Resources Group, Inc. effective January 3, 2014
|
January 3, 2014
|
Name
|
Title
|
Date of Agreement
|
Harry J. Pearce
|
Chairman of the Board of Directors
|
August 12, 2010
|
David L. Goodin
|
Director
|
August 12, 2010
|
Thomas Everist
|
Director
|
August 12, 2010
|
Karen B. Fagg
|
Director
|
August 12, 2010
|
Mark A. Hellerstein
|
Director
|
August 1, 2013
|
A. Bart Holaday
|
Director
|
August 12, 2010
|
Dennis W. Johnson
|
Director
|
August 12, 2010
|
Thomas C. Knudson
|
Director
|
August 12, 2010
|
William E. McCracken
|
Director
|
August 1, 2013
|
Patricia L. Moss
|
Director
|
August 12, 2010
|
J. Kent Wells
|
Director
|
May 2, 2011
|
John K. Wilson
|
Director
|
August 12, 2010
|
1.
|
By replacing the table in Section D‑1‑2
Eligibility to Share in the Profit Sharing Feature
of Supplement D-1,
Provisions Relating to the Profit Sharing Feature for Certain Participating Affiliates
, in its entirety, with the following:
|
Participating Affiliate
|
Current Effective Date
(Original Effective Date)
2
|
Anchorage Sand & Gravel Company, Inc. (excluding President)
|
January 1, 1999
|
Baldwin Contracting Company, Inc.
|
January 1, 1999
|
Cascade Natural Gas Corporation
|
January 1, 2011
July 2, 2007
|
Concrete, Inc.
|
January 1, 2001
|
Connolly-Pacific Co.
|
January 1, 2007
|
DSS Company
|
January 1, 2004
(July 8, 1999)
|
E.S.I., Inc.
|
January 1, 2008
(January 1, 2003)
|
Fairbanks Materials, Inc.
|
May 1, 2008
|
Granite City Ready Mix, Inc.
|
June 1, 2002
|
Great Plains Natural Gas Co.
|
January 1, 2008
|
Hawaiian Cement (non-union employees hired after December 31, 2005)
|
January 1, 2009
|
Participating Affiliate
|
Current Effective Date
(Original Effective Date)
2
|
Intermountain Gas Company
|
January 1, 2011
|
Jebro Incorporated
|
November 1, 2005
|
Kent’s Oil Service
4
|
January 1, 2007
|
Knife River Corporation - Northwest (the Central Oregon Division, f/k/a HTS)
|
January 1, 2010
(January 1, 1999)
|
Knife River Corporation - Northwest (the Southern Idaho Division)
|
January 1, 2010
(January 1, 2006)
|
Knife River Corporation - Northwest (the Southern Oregon Division)
|
January 1, 2012
|
Knife River Corporation - Northwest (the Spokane Division)
|
January 1, 2010
(January 1, 2006)
|
Knife River Corporation - Northwest (the Western Oregon Division)
|
January 1, 2012
|
Knife River Corporation - South
(f/k/a Young Contractors, Inc.)
|
January 1, 2008
(January 1, 2007)
|
LTM, Incorporated
|
January 1, 2003
|
Montana-Dakota Utilities Co. (including union employees)
|
January 1, 2008
|
Oregon Electric Construction, Inc.
3
|
March 7, 2011
|
Prairielands Energy Marketing, Inc.
|
January 1, 2012
|
Wagner Industrial Electric, Inc.
|
January 1, 2008
|
Wagner Smith Equipment Co.
|
January 1, 2008
(July 1, 2000)
|
WBI Energy, Inc.
1/3
|
May 1, 2012
|
WBI Energy Midstream, LLC
1/3
|
July 1, 2012
(January 1, 2001)
|
Participating Affiliate
|
Current Effective Date
(Original Effective Date)
2
|
WBI Energy Transmission, Inc.
1/3
|
July 1, 2012
(January 1, 2009)
|
WHC, Ltd.
|
September 1, 2001
|
2.
|
By replacing the table in Section D‑2‑2
Eligibility to Share in the Retirement Contribution
of Supplement D-2,
Provisions Relating to the Retirement Contribution Feature for Certain Participating Affiliates
, in its entirety, with the following:
|
Participating Affiliate
|
Current Effective Date (Original Effective Date)
|
Retirement Contribution Amount - Percentage of Compensation
|
Cascade Natural Gas Corporation (non-bargaining)
|
January 1, 2011
(July 2, 2007)
|
5%
|
Cascade Natural Gas Corporation (Field Operations Bargaining Unit employees hired on or after 1/1/2007)
|
July 2, 2007
|
4%
|
Fidelity Exploration & Production Company
2
|
January 1, 2006 (July 2, 2001)
|
5%
|
Great Plains Natural Gas Co.
|
January 1, 2003
|
5%
|
Participating Affiliate
|
Current Effective Date (Original Effective Date)
|
Retirement Contribution Amount - Percentage of Compensation
|
Intermountain Gas Company
|
January 1, 2011
(October 12, 2008)
|
5%
|
Oregon Electric Construction, Inc.
|
March 7, 2011
|
6%
|
Rocky Mountain Contractors, Inc. (Union)
3
|
January 1, 2008
|
3%
|
Rocky Mountain Contractors, Inc.
|
January 1, 2005
|
5%
|
WBI Energy Midstream, LLC
1
|
July 1, 2012 (January 1, 2001)
|
5%
|
3.
|
By replacing the following entry in Schedule A:
|
|
|
|
MDU RESOURCES GROUP, INC.
|
|
|
|
|
EMPLOYEE BENEFITS COMMITTEE
|
|
|
|
|
|
|
|
|
|
By:
/s/ Doran N. Schwartz
|
|
|
|
|
Doran N. Schwartz, Chairman
|
INTERNAL CORRESPONDENCE
|
|
LOCATION
|
Corporate Campus
|
|
|
|
|
DATE
|
May 16, 2013
|
|
|
|
WRITER
|
David L. Goodin
|
|
|
|
SUBJECT
|
Promotion
|
•
|
Effective Date
: The effective date of the promotion is April 30, 2013.
|
•
|
Salary Grade and Base Salary
: Your salary grade will increase from “H” to “J”, and your base salary will increase 16.67 percent, from $330,000 annually to $385,000 annually. Future salary increases will be determined by the Compensation Committee, and the timing of such increases is typically in November to become effective the following January.
|
•
|
EICP
: Your Executive Incentive Compensation Plan (EICP) target award will remain at 90 percent of base salary for 2013. Your 2013 EICP will be calculated using your prorated 2013 base salary (i.e., four months at an annualized salary of $330,000 and eight months at an annualized salary of $385,000). For 2014, 2015, 2016 and 2017, I will recommend to the Compensation Committee that your EICP target will decrease from the current 90 percent of base salary to 85 percent, 80 percent, 75 percent and 65 percent of base salary, respectively. The 65 percent of base salary would be consistent with other current executives in this salary grade. I will be recommending to the Compensation Committee that your Long-Term Incentive target be gradually increased to 90 percent of base salary which is discussed below.
|
•
|
Benefits
: Your current employee benefits package will not change, and you will continue to participate in the various plans consistent with CSG Corporate status.
|
•
|
Non-Qualified Defined Contribution Plan (NQDCP)
: Recall that you began participating in the NQDCP on January 1, 2013. As a reminder, the NQDCP is an executive retirement program whereby the Company credits to an account in your name at New York Life (“NYL”), and you can invest the account balance in a number of investment vehicles. After four years of continuous employment from the date of the Company’s initial credit, the credit and any investment earnings (or losses) become “vested” and will be distributed to you in accordance with the distribution election you made upon joining the NQDCP.
|
•
|
Relocation:
As we discussed, my expectation is that Bismarck is intended to be your headquarters. However, given your current situation I did agree to you basing out of the Portland area for now and that we will revisit the location over the next 12 months. Longer term I feel Bismarck is the appropriate location.
|
•
|
Background Check
: As you are now leading the CSG Business Unit, we will be conducting a background check to ensure we are setting a proper “tone at the top”.
|
•
|
Complete Agreement
: This outlines the complete agreement of the compensation related terms and conditions of your employment. This supersedes any prior agreements or understandings.
|
|
|
|
|
Sincerely,
|
|
||
|
|
|
|
/s/ David L. Goodin
|
|
||
|
|
|
|
David L. Goodin
|
|
||
|
|
|
|
President and Chief
|
|
||
|
|
|
|
Executive Officer
|
|
||
|
|
|
|
MDU Resources Group, Inc.
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
cc:
D. Anderson
|
|
M. Del Vecchio
|
|
F. Richard
|
|
|
|
Years Ended December 31,
|
|
||||||||||||||||||
|
|
2013
|
|
|
2012
|
|
|
2011
|
|
|
2010
|
|
|
2009
|
|
|
|||||
|
|
(In thousands of dollars)
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Earnings Available for Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net Income (a)
|
|
$
|
281,163
|
|
|
$
|
(14,939
|
)
|
|
$
|
223,842
|
|
|
$
|
218,205
|
|
|
$
|
(126,653
|
)
|
|
Income Taxes
|
|
136,736
|
|
|
(31,146
|
)
|
|
110,273
|
|
|
122,530
|
|
|
(96,092
|
)
|
|
|||||
|
|
417,899
|
|
|
(46,085
|
)
|
|
334,115
|
|
|
340,735
|
|
|
(222,745
|
)
|
|
|||||
Rents (b)
|
|
16,035
|
|
|
13,716
|
|
|
13,568
|
|
|
12,897
|
|
|
14,475
|
|
|
|||||
Interest (c)
|
|
92,481
|
|
|
83,781
|
|
|
86,505
|
|
|
88,930
|
|
|
89,943
|
|
|
|||||
Total Earnings Available for Fixed Charges
|
|
$
|
526,415
|
|
|
$
|
51,412
|
|
|
$
|
434,188
|
|
|
$
|
442,562
|
|
|
$
|
(118,327
|
)
|
|
Preferred Dividend Requirements
|
|
$
|
685
|
|
|
$
|
685
|
|
|
$
|
685
|
|
|
$
|
685
|
|
|
$
|
685
|
|
|
Ratio of Income Before Income Taxes to Net Income
|
|
149
|
%
|
|
308
|
%
|
|
149
|
%
|
|
156
|
%
|
|
176
|
%
|
|
|||||
Preferred Dividend Factor on Pretax Basis
|
|
1,021
|
|
|
2,110
|
|
|
1,021
|
|
|
1,069
|
|
|
1,206
|
|
|
|||||
Fixed Charges (d)
|
|
107,892
|
|
|
100,516
|
|
|
106,348
|
|
|
107,552
|
|
|
109,117
|
|
|
|||||
Combined Fixed Charges and Preferred Stock Dividends
|
|
$
|
108,913
|
|
|
$
|
102,626
|
|
|
$
|
107,369
|
|
|
$
|
108,621
|
|
|
$
|
110,323
|
|
|
Ratio of Earnings to Fixed Charges
|
|
4.9x
|
|
|
—
|
|
(e)
|
4.1x
|
|
|
4.1x
|
|
|
—
|
|
(f)
|
|||||
Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
|
|
4.8x
|
|
|
—
|
|
(e)
|
4.0x
|
|
|
4.1x
|
|
|
—
|
|
(f)
|
(a)
|
Net income excludes undistributed income for equity investees.
|
(b)
|
Represents interest portion of rents estimated at 33 1/3%.
|
(c)
|
Represents interest, amortization of debt discount and expense on all indebtedness and amortization of interest capitalized, and excludes amortization of gains or losses on reacquired debt (which, under the Federal Energy Regulatory Commission Uniform System of Accounts, is classified as a reduction of, or increase in, interest expense in the Consolidated Statements of Income) and interest capitalized.
|
(d)
|
Represents rents (as defined above), interest, amortization of debt discount and expense on all indebtedness, and excludes amortization of gains or losses on reacquired debt (which, under the Federal Energy Regulatory Commission Uniform System of Accounts, is classified as a reduction of, or increase in, interest expense in the Consolidated Statements of Income).
|
(e)
|
Due to the $246.8 million after-tax noncash write-downs of oil and natural gas properties in 2012, earnings were insufficient by $51.2 million to cover fixed charges for the 12 months ended December 31, 2012. If the $246.8 million after-tax noncash write-downs were excluded, the ratio of earnings to fixed charges and the ratio of earnings to combined fixed charges and preferred stock dividends would both have been 4.4 times for the twelve months ended December 31, 2012.
|
(f)
|
Due to the $384.4 million after-tax noncash write-down of oil and natural gas properties in 2009, earnings were insufficient by $228.7 million to cover combined fixed charges and preferred stock dividends for the twelve months ended December 31, 2009. If the $384.4 million after-tax noncash write-down is excluded, the ratio of earnings to fixed charges and the ratio of earnings to combined fixed charges and preferred stock dividends would both have been 4.6 times for the twelve months ended December 31, 2009.
|
|
Jurisdiction of
|
Subsidiaries
|
Formation
|
Alaska Basic Industries, Inc.
|
Alaska
|
Ames Sand & Gravel, Inc.
|
North Dakota
|
Anchorage Sand and Gravel Company, Inc.
|
Alaska
|
Baldwin Contracting Company, Inc.
|
California
|
BEH Electric Holdings, LLC
|
Nevada
|
Bell Electrical Contractors, Inc.
|
Missouri
|
BMH Mechanical Holdings, LLC
|
Nevada
|
Bombard Electric, LLC
|
Nevada
|
Bombard Mechanical, LLC
|
Nevada
|
Capital Electric Construction Company, Inc.
|
Kansas
|
Capital Electric Line Builders, Inc.
|
Kansas
|
Cascade Natural Gas Corporation
|
Washington
|
Centennial Energy Holdings, Inc.
|
Delaware
|
Centennial Energy Resources International, Inc.
|
Delaware
|
Centennial Energy Resources LLC
|
Delaware
|
Centennial Holdings Capital LLC
|
Delaware
|
Central Oregon Redi-Mix, LLC
|
Oregon
|
CGC Resources, Inc.
|
Washington
|
Concrete, Inc.
|
California
|
Connolly-Pacific Co.
|
California
|
Continental Line Builders, Inc.
|
Delaware
|
Coordinating and Planning Services, Inc.
|
Delaware
|
D S S Company
|
California
|
Desert Fire Holdings, Inc.
|
Nevada
|
Desert Fire Protection, a Nevada Limited Partnership
|
Nevada
|
Desert Fire Protection, Inc.
|
Nevada
|
Desert Fire Protection, LLC
|
Nevada
|
E.S.I., Inc.
|
Ohio
|
Fairbanks Materials, Inc.
|
Alaska
|
Fidelity Exploration & Production Company
|
Delaware
|
Fidelity Oil Co.
|
Delaware
|
Frebco, Inc.
|
Ohio
|
FutureSource Capital Corp.
|
Delaware
|
Granite City Ready Mix, Inc.
|
Minnesota
|
Hamlin Electric Company
|
Colorado
|
Harp Engineering, Inc.
|
Montana
|
Hawaiian Cement, a partnership
|
Hawaii
|
ILB Hawaii, Inc.
|
Hawaii
|
Independent Fire Fabricators, LLC
|
Nevada
|
Intermountain Gas Company
|
Idaho
|
International Line Builders, Inc.
|
Delaware
|
InterSource Insurance Company
|
Vermont
|
Jebro Incorporated
|
Iowa
|
JTL Group, Inc. (Montana corporation)
|
Montana
|
JTL Group, Inc. (Wyoming corporation)
|
Wyoming
|
Kent’s Oil Service
|
California
|
Knife River Corporation
|
Delaware
|
Knife River Corporation - North Central
|
Minnesota
|
Knife River Corporation - Northwest
|
Oregon
|
Knife River Corporation - South
|
Texas
|
Knife River Dakota, Inc.
|
Delaware
|
Knife River Hawaii, Inc.
|
Delaware
|
Knife River Marine, Inc.
|
Delaware
|
Knife River Midwest, LLC
|
Delaware
|
KRC Holdings, Inc.
|
Delaware
|
LME&U Holdings, LLC
|
Nevada
|
Lone Mountain Excavation & Utilities, LLC
|
Nevada
|
Loy Clark Pipeline Co.
|
Oregon
|
LTM, Incorporated
|
Oregon
|
MDU Brasil Ltda.
|
Brazil
|
MDU Construction Services Group, Inc.
|
Delaware
|
MDU Energy Capital, LLC
|
Delaware
|
MDU Industrial Services, Inc.
|
Delaware
|
MDU Resources International LLC
|
Delaware
|
MDU Resources Luxembourg I LLC S.a.r.l.
|
Luxembourg
|
MDU Resources Luxembourg II LLC S.a.r.l.
|
Luxembourg
|
MDU United Construction Solutions, Inc.
|
Delaware
|
Midland Technical Crafts, Inc.
|
Delaware
|
Nevada Solar Solutions, LLC
|
Delaware
|
Northstar Materials, Inc.
|
Minnesota
|
Oregon Electric Construction, Inc.
|
Oregon
|
Pouk & Steinle, Inc.
|
California
|
Prairie Cascade Energy Holdings, LLC
|
Delaware
|
Prairie Intermountain Energy Holdings, LLC
|
Delaware
|
Prairielands Energy Marketing, Inc.
|
Delaware
|
Rocky Mountain Contractors, Inc.
|
Montana
|
USI Industrial Services, Inc.
|
Delaware
|
Wagner Group, Inc., The
|
Delaware
|
Wagner Industrial Electric, Inc.
|
Delaware
|
Wagner-Smith Company, The
|
Ohio
|
Wagner-Smith Equipment Co.
|
Delaware
|
Wagner-Smith Pumps & Systems, Inc.
|
Ohio
|
Warner Enterprises, Inc.
|
Nevada
|
WBI Canadian Pipeline, Ltd.
|
Canada
|
WBI Energy Midstream Utah, LLC
|
Delaware
|
WBI Energy Midstream, LLC
|
Colorado
|
WBI Energy Services, Inc.
|
Delaware
|
WBI Energy Transmission, Inc.
|
Delaware
|
WBI Energy, Inc.
|
Delaware
|
WBI Holdings, Inc.
|
Delaware
|
WHC, Ltd.
|
Hawaii
|
RYDER SCOTT COMPANY
|
|
|
PETROLEUM CONSULTANTS
|
|
|
TBPE REGISTERED ENGINEERING FIRM F-1580
|
|
FAX (713) 651-0849
|
1100 LOUISIANA STREET SUITE 4600
|
HOUSTON, TEXAS 77002-5294
|
TELEPHONE (713) 651-9191
|
SUITE 600, 1015 4TH STREET, S.W.
|
CALGARY, ALBERTA T2R 1J4
|
TEL (403) 262-2799
|
FAX (403) 262-2790
|
621 17TH STREET, SUITE 1550
|
DENVER, COLORADO 80293-1501
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TEL (303) 623-9147
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FAX (303) 623-4258
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1.
|
I have reviewed this annual report on Form 10-K of MDU Resources Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
1.
|
I have reviewed this annual report on Form 10-K of MDU Resources Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
1.
|
Citations issued under Section 104 of the Mine Safety Act for violations that could significantly and substantially contribute to the cause and effect of a coal or other mine safety or health hazard.
|
2.
|
Orders issued under Section 104(b) of the Mine Safety Act. Orders are issued under this section when citations issued under Section 104 have not been totally abated within the time period allowed by the citation or subsequent extensions.
|
3.
|
Citations or orders issued under Section 104(d) of the Mine Safety Act. Citations or orders are issued under this section when it has been determined that the violation is caused by an unwarrantable failure of the mine operator to comply with the standards. An unwarrantable failure occurs when the mine operator is deemed to have engaged in aggravated conduct constituting more than ordinary negligence.
|
4.
|
Citations issued under Section 110(b)(2) of the Mine Safety Act for flagrant violations. Violations are considered flagrant for repeat or reckless failures to make reasonable efforts to eliminate a known violation of a mandatory health and safety standard that substantially and proximately caused, or reasonably could have been expected to cause, death or serious bodily injury.
|
5.
|
Imminent danger orders issued under Section 107(a) of the Mine Safety Act. An imminent danger is defined as the existence of any condition or practice in a coal or other mine which could reasonably be expected to cause death or serious physical harm before such condition or practice can be abated.
|
6.
|
Notice received under Section 104(e) of the Mine Safety Act of a pattern of violations or the potential to have such a pattern of violations that could significantly and substantially contribute to the cause and effect of mine health and safety standards.
|
MSHA Identification Number
|
Section 104 S&S Citations (#)
|
Section 107(a) Orders (#)
|
Total Dollar Value of MSHA Assessments Proposed ($)
|
Legal Actions Pending as of Last Day of Period (#)
|
Legal Actions Initiated During Period (#)
|
Legal Actions Resolved During Period (#)
|
|||||||
04-00081
|
—
|
|
—
|
|
$
|
—
|
|
4
|
|
—
|
|
—
|
|
04-01698
|
2
|
|
—
|
|
1,625
|
|
—
|
|
—
|
|
5
|
|
|
04-05140
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
3
|
|
|
04-05459
|
1
|
|
1
|
|
1,240
|
|
1
|
|
1
|
|
—
|
|
|
10-02089
|
1
|
|
—
|
|
550
|
|
—
|
|
—
|
|
1
|
|
|
21-00462
|
3
|
|
—
|
|
52,500
|
|
1
|
|
—
|
|
—
|
|
|
21-00519
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
21-02702
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
21-03112
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
21-03133
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
21-03248
|
1
|
|
—
|
|
400
|
|
—
|
|
—
|
|
—
|
|
|
21-03348
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
21-03416
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
21-03560
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
21-03790
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
24-00462
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
24-00478
|
1
|
|
—
|
|
600
|
|
—
|
|
—
|
|
—
|
|
|
24-01935
|
—
|
|
—
|
|
600
|
|
—
|
|
—
|
|
—
|
|
|
24-02022
|
2
|
|
—
|
|
617
|
|
1
|
|
1
|
|
—
|
|
|
24-02095
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
24-02414
|
—
|
|
—
|
|
300
|
|
—
|
|
1
|
|
1
|
|
|
24-02656
|
2
|
|
1
|
|
1,009
|
|
—
|
|
—
|
|
—
|
|
|
32-00774
|
1
|
|
—
|
|
408
|
|
—
|
|
—
|
|
—
|
|
|
32-00776
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
32-00777
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
32-00778
|
2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
32-00950
|
2
|
|
—
|
|
2,092
|
|
2
|
|
2
|
|
—
|
|
|
32-00963
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-00463
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-00495
|
—
|
|
—
|
|
390
|
|
—
|
|
—
|
|
—
|
|
|
35-02906
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-02968
|
—
|
|
—
|
|
700
|
|
—
|
|
—
|
|
—
|
|
|
35-03022
|
1
|
|
—
|
|
890
|
|
—
|
|
—
|
|
—
|
|
|
35-03131
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
35-03321
|
1
|
|
—
|
|
492
|
|
—
|
|
—
|
|
—
|
|
|
35-03449
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
5
|
|
|
35-03478
|
—
|
|
—
|
|
300
|
|
—
|
|
—
|
|
—
|
|
|
35-03496
|
1
|
|
—
|
|
792
|
|
—
|
|
—
|
|
—
|
|
|
35-03505
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-03527
|
3
|
|
—
|
|
490
|
|
—
|
|
—
|
|
—
|
|
|
35-03581
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
|
35-03590
|
—
|
|
—
|
|
200
|
|
—
|
|
—
|
|
—
|
|
MSHA Identification Number
|
Section 104 S&S Citations (#)
|
Section 107(a) Orders (#)
|
Total Dollar Value of MSHA Assessments Proposed ($)
|
Legal Actions Pending as of Last Day of Period (#)
|
Legal Actions Initiated During Period (#)
|
Legal Actions Resolved During Period (#)
|
|||||||
35-03605
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-03642
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
35-03667
|
1
|
|
—
|
|
8,100
|
|
—
|
|
1
|
|
4
|
|
|
35-03678
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
41-02639
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
1
|
|
|
41-03931
|
1
|
|
—
|
|
500
|
|
—
|
|
—
|
|
—
|
|
|
48-01383
|
—
|
|
—
|
|
2,369
|
|
—
|
|
4
|
|
4
|
|
|
50-00883
|
3
|
|
—
|
|
824
|
|
—
|
|
—
|
|
—
|
|
|
50-01196
|
2
|
|
—
|
|
1,120
|
|
—
|
|
—
|
|
—
|
|
|
51-00036
|
6
|
|
—
|
|
7,723
|
|
5
|
|
5
|
|
—
|
|
|
51-00171
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
51-00195
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
51-00241
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
51-00245
|
—
|
|
—
|
|
412
|
|
—
|
|
—
|
|
—
|
|
|
51-00305
|
—
|
|
—
|
|
100
|
|
—
|
|
—
|
|
—
|
|
|
|
37
|
|
2
|
|
$
|
90,843
|
|
14
|
|
15
|
|
24
|
|
•
|
Contests of Citations and Orders - A contest proceeding may be filed with the Commission by operators, miners or miners' representatives to challenge the issuance of a citation or order issued by MSHA.
|
•
|
Contests of Proposed Penalties (Petitions for Assessment of Penalties) - A contest of a proposed penalty is an administrative proceeding before the Commission challenging a civil penalty that MSHA has proposed for the alleged violation contained in a citation or order.
|
•
|
Complaints for Compensation - A complaint for compensation may be filed with the Commission by miners entitled to compensation when a mine is closed by certain withdrawal orders issued by MSHA. The purpose of the proceeding is to determine the amount of compensation, if any, due miners idled by the orders.
|
•
|
Complaints of Discharge, Discrimination or Interference - A discrimination proceeding is a case that involves a miner's allegation that he or she has suffered a wrong by the operator because he or she engaged in some type of activity protected under the Mine Act, such as making a safety complaint.
|
•
|
Applications for Temporary Relief - Applications for temporary relief from any modification or termination of any order or from any order issued under section 104 of the Mine Act.
|
•
|
Appeals of Judges' Decisions or Orders to the Commission - A filing with the Commission for discretionary review of a judge's decision or order by a person who has been adversely affected or aggrieved by such decision or order.
|
MSHA Identification Number
|
Contests of Citations and Orders
|
Contests of Proposed Penalties
|
Complaints for Compensation
|
Complaints of Discharge, Discrimination or Interference
|
Applications for Temporary Relief
|
Appeals of Judges' Decisions or Orders to the Commission
|
||||||
04-00081
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4
|
|
04-05459
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
21-00462
|
—
|
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
24-02022
|
1
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
32-00950
|
2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
51-00036
|
—
|
|
5
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
4
|
|
6
|
|
—
|
|
—
|
|
—
|
|
4
|
|
/s/ Joseph E. Blankenship
|
Joseph E. Blankenship, P.E.
|
TBPE License No. 62093
|
Senior Vice President
|
RYDER SCOTT COMPANY
|
|
|
PETROLEUM CONSULTANTS
|
|
|
TBPE REGISTERED ENGINEERING FIRM F-1580
|
|
FAX (713) 651-0849
|
1100 LOUISIANA STREET SUITE 4600
|
HOUSTON, TEXAS 77002-5294
|
TELEPHONE (713) 651-9191
|
|
|
|
|
|
|
|
January 27, 2014
|
|
As of December 31, 2013
|
|
|
Proved
|
||||||
|
|
Developed
|
|
|
|
Total
|
||
|
|
Producing
|
|
Non-Producing
|
|
Undeveloped
|
|
Proved
|
Total Net Reserves
All Audited by Ryder Scott
|
|
|
|
|
|
|
|
|
Oil/Condensate - Barrels
|
|
30,340,787
|
|
1,053,097
|
|
9,624,858
|
|
41,018,742
|
Plant Products - Barrels
|
|
4,396,622
|
|
925,791
|
|
1,279,878
|
|
6,602,291
|
Gas – MMCF
|
|
143,048
|
|
33,498
|
|
21,899
|
|
198,445
|
(1)
|
completion intervals which are open at the time of the estimate, but which have not started producing;
|
(2)
|
wells which were shut-in for market conditions or pipeline connections; or
|
(3)
|
wells not capable of production for mechanical reasons.
|
(i)
|
Reserves on undrilled acreage shall be limited to those directly offsetting development spacing areas that are reasonably certain of production when drilled, unless evidence using reliable technology exists that establishes reasonable certainty of economic producibility at greater distances.
|
|
|
MDU Resources Group, Inc.
|
|
|
|
|
|
|
|
By:
|
/s/ Doran N. Schwartz
|
|
|
|
Name: Doran N. Schwartz
|
|
|
|
Title: Vice President and
|
|
|
|
Chief Financial Officer
|
By:
|
|
|
Name:
|
|
Title:
|
|
|
MDU Resources Group, Inc.
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Name:
|
|
|
|
Title:
|
By:
|
/s/ Gregory M. Ogborn
|
|
Name: Gregory M. Ogborn
|
|
Title: Vice President
|