NiSource to cut 370 to 380 jobs in 2009

Energy holding company NiSource Inc. on Friday said its business segment, NiSource Gas Transmission & Storage (NGT&S), will slash 370 to 380 jobs, across its 16-state operating territory over the course of 2009.

The Houston-based business unit said the cuts, representing about 25 percent of its workforce, will improve operational efficiencies as the company positions to weather challenging economic conditions. The move follows job cuts announced Thursday by Chesapeake Energy Corp.

Christopher Helms, president of NGT&S, said eligible employees will be offered a competitive severance package and outplacement assistance. Certain employee groups will be eligible for voluntary severance.

NGT&S companies own and operate about 15,000 miles of interstate natural gas pipelines and 37 underground natural gas storage fields, delivering more than 1 trillion cubic feet of natural gas per year.

Chesapeake, which was a co-defendent with NiSource in a West Virginia Supreme Court case, on Thursday also announced job cuts. The natural gas producer said it would eliminate a majority of the 225 jobs at its West Virginia regional office, shifting a substantial number of positions back to its home state of Oklahoma.

Chief Executive Aubrey McClendon said the West Virginia Supreme Court is partially to blame for the move.

The state's lone appellate court refused to review a $404 million verdict awarded to landowners in a royalties dispute last year. Chesapeake, which says it has invested $850 million in West Virginia over the past four years, first responded by dropping plans to construct a $40 million regional headquarters building in Charleston.

In a West Virginia Supreme Court case, natural gas producer Chesapeake Energy Corp. and co-defendent NiSource Inc. settled the case by agreeing to pay $380 million to landowners.

NiSource said 170 jobs in West Virginia will be eliminated, but said the cuts are unrelated to the lawsuit.

"This decision had nothing to do with court rulings or decisions made by other companies," said NGT&S spokeswoman Pamela Tragesser. "This is about our need to operate more efficiently and address the economic situation."

Tragesser added that most employees will be notified Friday and Monday, and that the company hopes to let most employees know their status by the end of March.

Shares of NiSource gained 1 cent to $8.93 in Friday midday trading. Chesapeake Energy shares rose 43 cents to $15.87.