tw expansion forwarded lorraine lindberg et enron 02 15 2001 08 01 drew fossum 02 14 2001 04 38 pm susan scott et enron enron sstojic gbmdc com mary kay miller et enron enron keith petersen enron enronxgate cc shelley corman enron enronxgate maria pavlou enron enronxgate steven harris et enron enron jeffery fawcett et enron enron kevin hyatt et enron enron lorraine lindberg et enron enron subject tw expansion several questions left legal regulatory work close meeting today try restate add initial thoughts sure focus correct problems q 1 tw use negotiated rate agreements new 150 mm expansion yes independence guardian new pipeline projects certificated basis negotiated rate contracts restriction need always offer cost based recourse rate service alternative negotiated rates hope use negotiated rate agreements entire 150 mm capacity know contracts executed much negotiated rate contracts much recourse rate contracts guess means cert app tell commission 100 risk given huge interest open season doubts ability sell full 150 also tell commission expect sell capacity using negotiated rate contracts recourse rate contracts combination q 2 give prospective customers cafeteria style menu options steal jeff term like following 1 5 yr neg rate deal locked 60 plus fuel surcharges whatever number decide 2 10 neg rate deal locked 45 plus fuel surcharges 3 15 yr neg rate deal locked 35 blah blah 4 15 yr cost based recourse rate plus fuel surcharges importantly option locked float tw actual rate levels fuel retainage percentages think answer yes whatever options come 1 2 3 always offer 4 well susan steve stojic please confirm right define specific negotiated rate options stick otherwise negotiated rate approach could get completely unstructured end guys taking specific options guys custom tailoring weird variations like 7 yr 231 day contract 51764 example sure would bad thing need think need sure tell customer make stick tries mix match asking 5 yr term 35 rate example think lay options choosing enforce substitutions policy sticking cafeteria theme need sure q 3 use cafeteria options approach much flexibility structuring options one hard need sure price term choose offer options 1 3 solely within discretion want second guessed ferc whether offered option 1 58 instead 60 susan steve guys confirm discretion structure negotiated rate options mean slant economics negotiated rate options better deal recourse option shippers e could deliberately incent shippers sign short term deals e offering options 1 3 55 45 40 instead 60 45 35 shown suspect guardian pipes obtain 100 subscription neg rate deals q 4 allocate capacity customers demand exceeds supply ideally able allocate 150 guys want buy way prefer sell example assuming stan danny steve decide short term deals better get 100 mm offers 4 rate term options described 400 mm demand 150 mm project sell 100 guys want option 1 60 5 yrs remaining 50 10 yr 45 guys really hoses recourse bidders cover recourse demand first allocate remaining capacity pro rata everyone else pro rata everyone rule negotiated rate bids deemed max rate purposes allocation pro rata everyone may right answer least answer filled recourse rate guys orders give remaining capacity neg rate guys whose bids value highly using objective nondiscriminatory calculation course ugh susan steve please take crack questions 2 4 think 1 answered already done research yet maybe questions easier currently seem get mkm phone convenience discuss got ta move quick marketers get sell stuff df