Visions - Winter 2008 - 4

Mineral Resources & Energy Pacific Summit Energy Experiences Profit and Expansion PSE Emerges As Energy Trading and Marketing Success, Looks To Expand Business Reach T he SCOA family of energy-related businesses welcomed a new family member in 2004 when Sumitomo Corporation and SCOA formed Pacific Summit Energy (PSE) to expand their presence in the North American energy industry. Just two years after its inception, PSE experienced revenues of approximately $1 billion. In fiscal 2007, PSE’s revenues will exceed $2 billion, and the company looks to continue that pattern of profitability. PSE’s inception sprung from three seeds: the parent company’s global energy resources & experience, Sumitomo and SCOA’s proven financial strength, and a management team with over 20 years in natural gas marketing and trading experience. From a pure profit standpoint, PSE’s growth is now a bona fide success story. Just two years after its inception, PSE experienced revenues of approximately $1 billion. In fiscal 2007, PSE’s revenues will exceed $2 billion, and the company looks to continue that pattern of profitability. “It’s about being a part of a bigger picture,” said Brian Mock, President of PSE. “We’ve staffed our business with professionals who held senior management positions with the largest energy companies in the world, along with professionals from Sumitomo who had background on the parent company’s capabilities and infrastructure along with their global experience,” Mock continued.“Post Enron, the energy industry was looking for financially strong counterparties with experience in the physical business and PSE/Sumitomo was welcomed as a qualified new entrant to North America by bringing much need liquidity.” Yoshihiko Hori, Chairman of PSE commented,“To that end, SCOA Group is an important supplier and service provider to the North American natural gas and crude oil producer community. So beyond the natural gas marketing and trading business, there also existed many ways that SCOA benefits from owning a natural gas business.” “As to the issue of shortage of natural gas in the U.S. in the future, LNG would represent a more important role. Sumitomo Group has 30 years experience of trading, transporting and marketing LNG in the Asian-Pacific market. PSE and Sumitomo have much confidence that our experiences and expertise in LNG industry will organically correlate with U.S. natural gas business and enable us to offer longer term solutions to natural gas end-users. Although there are so many financial institutes and natural gas traders talking about 4 visions Winter 2008 LNG, there are few who actually and physically traded LNG. We have a significant advantage.” Hori said. “PSE is not just a one-off experiment in the potential for owning a business in the energy sector,” Mock explained. “SCOA and Sumitomo are already significant participants in North American energy business through their ownership of Premier Pipe, a major supplier of tubular products to the producers of oil and gas, and Perennial Power, a successful participant in the electric generation business. SCOA and Sumitomo broaden their footprint in the energy industry by owning different companies that are successful in different aspects of the business, and PSE is proud to be a member of that family.” To understand just how successful the company became, it is important to note that PSE captured a significant market share in California, a state that uses approximately the same amount of gas as Japan each day (approximately 6.5 billion cubic feet every 24 hours). As PSE looks toward the rest of North America, we must note that the United States uses 10 times more natural gas than California. In addition to California, PSE is purchasing natural gas and selling to utilities, independent power producers, and commercial and industrial customers in more than 10 states across the U.S. PSE believes it will attract more customers through competitive pricing, excellent operations, and prompt response to customer needs combined with financial strength and a focus on creating solutions to those needs. As national demand for gas grows, and as

Visions - Winter 2008

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