Mitsubishi estimates its National Energy & Gas claims to be $300 million

By Jeff Pines

Washington, March 24 - Mitsubishi Heavy Industries Ltd. filed a March 23 motion asking the U.S. Bankruptcy Court for the District of Maryland, Greenbelt Division to confirm its $300 million in claims against National Energy & Gas Transmission, Inc.

A subsidiary of National Energy & Gas contracted with Mitsubishi, a Japanese manufacturer of power plant turbines, in September 2000 to provide turbines for several power plants the company was building.

But things took turn for the worse for the PG&E Corp. subsidiary.

By October 2002, National Energy & Gas had decided to stop funding the construction of three power plants and by Nov. 14, 2002, it had defaulted on its corporate revolver. It filed for Chapter 11 on July 8, 2003.

On March 22, the U.S. trustee appointed Daniel Scotto as examiner to determine whether the project companies that were to own the power plants struck favorable deals with their parent company's bankers.

The examiner will examine each of the project guarantee claims to determine if the claims are overstated. The examiner will report back by April 28, according to judge's order asking the trustee to appoint an examiner.

The appointment is subject to the court's approval.

The Chapter 11 case number is 03-30459.

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