Exhibit TPC-77 in Trailblazer Pipeline Co's proceeding under RP03-162:Testimony of J Peter Williamson on behalf of Trailblazer Pipeline Co.

Jnofflclal FERC-Generated PDF of 20040130-0246 Received by FERC OSEC 10/09/2003 in D o c k e t # : R P 0 3 - 1 6 2 - 0 0 0 Exhibit No. TPC-77 UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION In the Matter of ) ) Trailblazer Pipeline ) Docket No. RP03- Company ) TESTIMONY OF J. PETER WILUAMSON ON BEHALF OF TRAILBLAZI~R PIPELINE 0MPANY 1 Q. Please state your name and business address. 2 A. My name is J. Peter Williamson. My business address is 89 Main Street, West v 3 Lebanon, New Hampshire 03784, and P.O. Box 5160, Hanover, New Hampshire 4 03755. 5 Q. What is your occupation? 6 A. I am the Laurence F. Whittemore Professor of Finance Emeritus at the Amos 7 Tuck School of Business Administration, Dartmouth College. I have retired from 8 teaching and continue to act as a consultant to various organizations, both 9 business and nonpmfff ins~utions, on matters pertaining to corporate finance 10 and investments. I have testified in numerous proceedings before the Federal 11 Energy Regulatory Commission ('Commission" or "FERC") and other regulatory 12 agencies regarding cost of equity, capital structure and other financial matters. 13 My education and qualiFcations are set out in some detail in my Exhibit No. TPC- %,~' 14 78. FEDERALENI~GYREGULATORYCOMMISSION H ~ n Ex,No ~-"~"~--~"~-'~' . t J 1 Dateldcmit'cd, t :>-~"C~-~., D~ Admitted. . . . J , Q - ~ ( ~ . ~ Jnofflclal FERC-Generated PDF of 20040130-0246 Received by FERC OSEC 10/09/2003 in D o c k e t # : R P 0 3 - 1 6 2 - 0 0 0 1 Q. What is the purpose of your direct testimony in this case? 2 A. I have been asked to verify the capital structure appropriate for use by 3 Trailblazer Pipeline Company ('Trailblazer" or 'the Company') in this proceeding, 4 the cost of long-term debt for the Company, and its cost of common equity. 5 SUMMARY S Q. Please summarize your verification of the capital structure that should be used 7 for Trailblazer. 8 A. Company witness Mr. Bruce H. Newsome explains in his testimony why the 9 Company is using 60% equity and 40% debt as its capital structure for purposes 10 of this proceeding. Trailblazer's long-term capital structure as of the end of the 11 test period will consist entirely of equity. However 100% equity financing is, I 12 believe, unacceptable to the FERC for ratemaking purposes. I believe that a 13 capital structure for ratemaldng purposes of 60% common equity and 40% long- 14 term debt is just and reasonable, and I shall present the reasons for that 15 conclusion. 16 Q. Please summarize your verification of the cost of long-term debt for Trailblazer. 17 A. In ...