fw : tw obas calling for volumetric settlement this is the final oba letter that we should be using to terminate the volumetric obas . lee will be down sometime tomorrow afternoon to review all our letters . - - - - - original message - - - - - from : pryor , tony sent : tuesday , september 25 , 2001 5 : 24 pm to : lindberg , lorraine subject : fw : tw obas calling for volumetric settlement importance : high - - - - - original message - - - - - from : pryor , tony sent : saturday , september 22 , 2001 9 : 16 am to : huber , lee cc : watson , kimberly subject : tw obas calling for volumetric settlement lee , as i mentioned on friday , the purpose of the attached letter is to terminate the volumetric obas and revert to the tariff oba to avail ourselves of the " hammer " in section 4 ( b ) of the tariff form ( sheet 147 ) which permits us to credit the operators ' scheduled volumes to the imbalance , ie , confiscate their gas . i ' m told that the subject obas were individually negotiated and deviate from the tariff in one way or another . they also said that these obas allow cashout , but don ' t require it , and that ' s the problem : the operators are not voluntarily paying back the gas because in many locations ( ie , san juan ) , the pipeline is full and they don ' t want to short their markets . because i haven ' t seen any of the agreements that we propose to terminate ( the tw people have just finished briefing them ) , i told the group that an attorney needs to look at each one to make sure that we cannot , in fact , force cashout . in most of them , i ' m told , cashout is at the option of the party owing the imbalance . as i also mentioned , this letter is a template ; a starting point . it must be tailored to each oba being terminated . for example , the section numbers are not filled in , and must be supplied . you will note in the second paragraph of the letter that we say , essentially , that in capacity - constrained area , if volumetric settlement is to occur , it will need to be accomplished through crediting their scheduled volumes to the imbalance . from my conversations with tw , my understanding is that most of the volumetric obas do not have a provision expressly permitting us to do that . indeed , as i mentioned above , that ' s my understanding of why we ' re terminating the volumetric obas . even if there is no provision in the subject obas for crediting scheduled volumes , my opinion is that we can offer that as an option , because that is still a way of balancing " in kind " , but omit the reference to the agreement ( as i have noted with brackets ) . if they don ' t want to do that , cashout is the only other option ; that ' s our way of forcing cashout . thanks for your help , and if you need help , you might ask maria or dari . however , i don ' t envision that it will take much time to do any one letter . . . . . . . . . . . . . . . . . tony