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Purchase of Elam Utility approved

The state Public Service Commission approved West Liberty's purchase of Elam Utility, a gas company that was in danger of being shut off because of unpaid debts.

Elam had failed to compensate its wholesaler, Columbia Gas Transmission Co., for about $644,000 worth of natural gas dating back to at least 2006. Elam billed its customers and was paid, but it never replaced the gas it pulled from Columbia's pipeline, as required.

West Liberty is to pay Columbia $64,000 immediately and settle the rest of its debt within 14 days by buying natural gas from a third party to place in Columbia's line. City officials said Friday that they were negotiating the amount of the debt with Columbia.

Columbia said earlier this summer that if it wasn't paid, it would shut off the gas supply to about 410 Morgan County customers, including a state prison, a nursing home, numerous businesses and homes. West Liberty offered to buy the company, until now a family-run business, in July.

West Liberty agreed to take on Elam's total debt of around $900,000 in exchange for the company's assets, valued about $750,000. The city also runs a municipal water and sewer company.

The purchase does not end a PSC investigation into Elam owners' failure to provide timely quarterly gas cost adjustments — meaning it could have been over- or under-charging customers. A hearing in that case is set for Tuesday.