The Environmental Protection Information Center (EPIC) has uncovered administrative court filings showing that a senior vice president of Calpine testified under oath that its proposed liquefied natural gas (LNG) import facility on Humboldt Bay has a "50/50" chance of succeeding due to the company's serious financial troubles.

Mr. Lawrence Izzo, who worked at Enron before Calpine, testified that because "Calpine is experiencing financial difficulties," he could not "say definitively that an LNG facility will...be built." He went further to say there is only a 50% chance it will be constructed. This testimony was in an administrative law proceeding before the Federal Trade Commission in March 2003.

Calpine's financial situation has worsened since that time. In October 2003, Moody's Investors Service downgraded its debt rating due to a weak operating cash flow relative to its substantial debt and the belief that its financial performance will continue to be weak. The company carries a debt of $16 billion, while its capitalization is only $1.63 billion.

Excerpts from the court filing follow. The entire document can be viewed on the Federal Trade Commission's website at http://www.ftc.gov/ or at http://search.ftc.gov/query.html?qt="LNG"+AND+"Humboldt"&col=hsr&col=news&col=full*
Articles and other information on Calpine's tenuous financial situation, its dubious corporate record, and its proposed LNG facility are available on EPIC's website at http://www.wildcalifornia.org/humboldtbay/LNG

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Excerpts from filing submitted in the matter of the Chicago Bridge and Iron Company and Pitt-Des Moines, Inc, Docket No. 9300, before the Federal Trade Commission:

Larry Izzo of Calpine is considering constructing an LNG import facility at a cost of approximately $250 million. (Izzo, Tr. 6493). As senior vice president, Mr. Izzo is responsible for the company's current plans to construct an LNG facility in Humboldt Bay, California. (Izzo, Tr. 6474).

Response to RFOF 3.587
Mr. Izzo conceded that he has never supervised any LNG tank construction projects for Calpine in the U.S. or abroad. (Izzo, Tr. 6513). Indeed, if the Humboldt project never comes to fruition, Mr. Izzo will miss his next chance to supervise an LNG project. Mr. Izzo testified that the Humboldt, California facility is "in the early stages of possible development," and that because "Calpine is experiencing financial difficulties" Mr. Izzo cannot "say definitively that an LNG facility will ... be built." (Izzo, Tr. 6521). In fact, the Calpine representative testified that there is only a 50% chance that the facility will be built. (Izzo, Tr. 6522).