CenterPoint Energy 2009 Annual Report Download - page 130

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Compensation and Liability Act of 1980, as amended, and applicable state statutes, and is vigorously contesting the
suit and its designation as a PRP. CERC and CenterPoint Energy do not expect the ultimate outcome to have a
material adverse impact on the financial condition, results of operations or cash flows of either CenterPoint Energy
or CERC.
Mercury Contamination. CenterPoint Energy’s pipeline and distribution operations have in the past employed
elemental mercury in measuring and regulating equipment. It is possible that small amounts of mercury may have
been spilled in the course of normal maintenance and replacement operations and that these spills may have
contaminated the immediate area with elemental mercury. CenterPoint Energy has found this type of contamination
at some sites in the past, and CenterPoint Energy has conducted remediation at these sites. It is possible that other
contaminated sites may exist and that remediation costs may be incurred for these sites. Although the total amount
of these costs is not known at this time, based on CenterPoint Energy’s experience and that of others in the natural
gas industry to date and on the current regulations regarding remediation of these sites, CenterPoint Energy believes
that the costs of any remediation of these sites will not be material to CenterPoint Energy’s financial condition,
results of operations or cash flows.
Asbestos. Some facilities owned by CenterPoint Energy contain or have contained asbestos insulation and other
asbestos-containing materials. CenterPoint Energy or its subsidiaries have been named, along with numerous others,
as a defendant in lawsuits filed by a number of individuals who claim injury due to exposure to asbestos. Some of
the claimants have worked at locations owned by CenterPoint Energy, but most existing claims relate to facilities
previously owned by CenterPoint Energy’s subsidiaries. CenterPoint Energy anticipates that additional claims like
those received may be asserted in the future. In 2004, CenterPoint Energy sold its generating business, to which
most of these claims relate, to Texas Genco LLC, which is now known as NRG Texas LP. Under the terms of the
arrangements regarding separation of the generating business from CenterPoint Energy and its sale to NRG Texas
LP, ultimate financial responsibility for uninsured losses from claims relating to the generating business has been
assumed by NRG Texas LP, but CenterPoint Energy has agreed to continue to defend such claims to the extent they
are covered by insurance maintained by CenterPoint Energy, subject to reimbursement of the costs of such defense
from NRG Texas LP. Although their ultimate outcome cannot be predicted at this time, CenterPoint Energy intends
to continue vigorously contesting claims that it does not consider to have merit and does not expect, based on its
experience to date, these matters, either individually or in the aggregate, to have a material adverse effect on
CenterPoint Energy’s financial condition, results of operations or cash flows.
Groundwater Contamination Litigation. Predecessor entities of CERC, along with several other entities, are
defendants in litigation, St. Michel Plantation, LLC, et al, v. White, et al., pending in civil district court in Orleans
Parish, Louisiana. In the lawsuit, the plaintiffs allege that their property in Terrebonne Parish, Louisiana suffered
salt water contamination as a result of oil and gas drilling activities conducted by the defendants. Although a
predecessor of CERC held an interest in two oil and gas leases on a portion of the property at issue, neither it nor
any other CERC entities drilled or conducted other oil and gas operations on those leases. In January 2009, CERC
and the plaintiffs reached agreement on the terms of a settlement that, if ultimately approved by the Louisiana
Department of Natural Resources, is expected to resolve this litigation. CenterPoint Energy and CERC do not expect
the outcome of this litigation to have a material adverse impact on the financial condition, results of operations or
cash flows of either CenterPoint Energy or CERC.
Other Environmental. From time to time CenterPoint Energy has received notices from regulatory authorities or
others regarding its status as a PRP in connection with sites found to require remediation due to the presence of
environmental contaminants. In addition, CenterPoint Energy has been named from time to time as a defendant in
litigation related to such sites. Although the ultimate outcome of such matters cannot be predicted at this time,
CenterPoint Energy does not expect, based on its experience to date, these matters, either individually or in the
aggregate, to have a material adverse effect on CenterPoint Energy’s financial condition, results of operations or
cash flows.
Other Proceedings
CenterPoint Energy is involved in other legal, environmental, tax and regulatory proceedings before various
courts, regulatory commissions and governmental agencies regarding matters arising in the ordinary course of
business. Some of these proceedings involve substantial amounts. CenterPoint Energy regularly analyzes current