USA: UPDATE 2-SoCal Edison in default, bankruptcy looms.
By Jonathan Stempel

01/16/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW YORK, Jan 16 (Reuters) - In a move that escalates the California power
crisis, embattled California utility Southern California Edison said on
Tuesday it has suspended at least $596 million of payments to creditors,
moving it closer to a possible bankruptcy filing.
SoCal Edison and No. 1 rival Pacific Gas and Electric Co., a unit of San
Francisco-based PG&E Corp., have run up billions of dollars of debt this year
because they are subject to a rate freeze and have been unable to pass on
their skyrocketing wholesale power costs to consumers.
In mirror filings on Tuesday with the Securities and Exchange Commission, the
state's No. 2 utility and its parent, Rosemead, Calif.-based Edison
International, said that to conserve cash SoCal Edison has "temporarily
suspended" three payments due Tuesday.
These payments include $230 million of principal and interest on its 5.875
percent notes, $215 million to the California Power Exchange, and $151
million to "qualifying facilities," as well as "certain other obligations."
Failure to make the note payment puts SoCal Edison in default on the notes,
and on other of SoCal Edison's and Edison International's credit facilities,
the filings said. The Power Exchange, which arranges sales of power to the
utilities, can foreclose on collateral the utility pledged, they said.
SoCal Edison said it had nearly $1.2 billion of cash on hand as of Monday,
and will run out of cash on Feb. 2 assuming it makes all payments when due.
"It's an extremely negative sign, and telegraphs the company's intention to
take this to the mat," said Shawn Burke, head of U.S. investment-grade
research at Barclays Capital. "Unless the legislature pulls a bill out of its
hat, giving them virtually all of what they want, it's pretty much over."
Edison International also said in the filings that it plans to amend the
articles of incorporation and by-laws for Edison Mission Energy, a
wholly-owned unit, to protect its low investment-grade ratings.
Edison International shares traded Tuesday on the New York Stock Exchange at
$9-1/8, down $1-1/16, or 10.4 percent. PG&E shares fell $1-9/16, or 13.5
percent, on the Big Board to $10.
On Jan. 4, the California Public Utilities Commission recommended giving the
utilities a temporary 10 percent rate hike. The utilities, rating agencies
and many analysts consider such a hike inadequate. Edison International has
suspended its dividend, and SoCal Edison plans to slash up to 1,850 jobs.
DOWNGRADES LIKELY
The missed payments effectively ensure that credit rating agencies Standard &
Poor's and Moody's Investors Service will cut at least some of SoCal Edison's
credit and debt ratings to junk status.
When a company misses a debt payment, S&P ordinarily does not wait for a
grace period, if any, to run before cutting its rating for that debt to "D,"
or default.
A downgrade to below investment-grade status would put SoCal Edison in
default of some of its credit lines and bank loans, and ratchet up its
liquidity crunch.
"It's difficult to lend if there is no short-term solution, much less a
long-term one," said Burke.
The utility, as well as Pacific G&E, have been shut out of the short-term
debt capital markets, and have already drawn on backup credit lines.
S&P now rates most of SoCal Edison's senior long-and short-term debt
"BBB-minus" and "A-3," its lowest investment grades. Moody's rates the
respective debt a roughly equivalent "Baa3" and "Prime-3." The utilities'
debt trades like junk.
A third rating agency, Fitch, has already cut SoCal Edison's and Edison
International's ratings deeply into junk. The bank loans and credit lines
contain no default provisions triggered by that downgrade, analysts said.
DELAYING REPORTING RESULTS
Separately, SoCal Edison and Edison International said they plan to postpone
release of their fourth quarter and year-end 2000 fiscal results pending
further developments.
Analysts said SoCal Edison is acting now to push California legislators and
regulators to craft a remedy fast.
"This is a rugged step toward moving this process along, and forcing
California to do something," said Jerry Bellucci, senior vice president for
Applied Economic Research, a New York-based energy consulting firm.
Burke said SoCal Edison will wait as long as possible to file for bankruptcy
protection.

USA: S&P to issue statement on SoCal Edison Tuesday.

01/16/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW YORK, Jan. 16 (Reuters) - Credit rating agency Standard & Poor's said on
Tuesday it plans to issue a statement by 12 P.M. (1700 GMT) about Southern
California Edison's failure to make $596 million of payments to various
creditors.
The announcement came in a voice-mail message left by Richard Cortright, an
S&P analyst following the California power crisis.
SoCal Edison, a unit of Rosemead, Calif.-based Edison International , said it
temporarily postponed the payments as it seeks to negotiate a resolution for
its cash crunch.

USA: Calif. declares highest level power alert.

01/16/2001
Reuters English News Service
(C) Reuters Limited 2001.

SAN FRANCISCO, Jan 16 (Reuters) - California, in the grips of its worst-ever
power crisis, on Tuesday declared a Stage Three power emergency, the
highest-level alert, citing a severe shortage of power and natural gas needed
to generate electricity.
A spokesman for the California Independent Operator System (ISO), the agency
that oversees the operation of most of the state's power grid, said it did
not appear likely they would have to trigger rolling blackouts to relieve the
heavy load on the system, although the possibility exists whenever a Stage
Three alert is called.
The ISO spokesman said 10,700 megawatts of generation were off line in
California for repairs or maintenance. Schools and offices reopened after the
Martin Luther King Day U.S. holiday on Monday, pushing up demand. One
megawatt powers about 1,000 homes.
The spokesman said there was also a shortage of natural gas available in
southern California, forcing power plants there to switch to oil to run their
generators. About one-third of all California power is produced at gas-fired
plants.
California has declared a statewide Stage Three alert only twice before, but
each time narrowly averted rolling blackouts as emergency supplies were made
available from neighboring states.
.
Only 54% of Californians Feel That There Is an Energy Crisis

01/16/2001
PR Newswire
(Copyright (c) 2001, PR Newswire)

Knowledge Networks Unique Poll Finds Majority Expect Even More Increases
From the CPUC.
MENLO PARK, Calif., Jan. 16 /PRNewswire/ -- The energy crisis, which is
dominating media coverage, paralyzing state government, and prompting
industry to consider moving operations elsewhere, is causing less concern
among average California citizens. Results from a recent survey conducted by
Knowledge Networks using its unique population projectable Web-enabled panel,
show that just 54% think the current situation is a crisis -- 21% don't
believe that there is a crisis and 25% don't know.
However, California citizens are losing confidence in the system that
controls electric power in the state. -- 80% believe the CPUC will extend the
recent temporary rate increase
given to PG&E and Southern California Edison beyond the 90 day limit
-- 75% expect an additional rate increase once the 90 day period is over
-- 14% are positive about electricity deregulation
-- 61% support reconsidering deregulation

In addition to attitudes about changing deregulation, Californians were
surveyed about an extensive range of proposals for dealing with the energy
situation. People were asked the questions in the same manner as the various
proposals have been summarized in the media reports. This may account for the
high support received on a couple of the proposals. For example 90% of the
respondents approved the Governor's suggestion to, "add new power generation
plants within California and make existing plants more efficient." The
proposal as worded doesn't distinguish between adding new plants or making
existing plants more efficient or some combination thereof. Critics note that
in the past Californians have been hesitant about power plants being built in
their own communities. Among the other proposals, Californians are most
supportive of:
-- 76% Federal limits on the amount that electricity suppliers can charge
for wholesale energy sold to California utilities
-- 59% Incentives for reducing electricity usage by 8%
-- 57% Creating a state power authority to take over existing plants and
speed up the building of new power plants

Attitudes towards the two largest investor owned utilities, PG&E and Southern
California Edison are noticeably split. 41% find the explanations about the
crisis given by the utilities to be believable, while an equal percentage
(42%) don't believe them. With regards to the possibility of going bankrupt,
46% think that it is somewhat likely that the two utilities will be forced to
declare bankruptcy if they don't receive outside help. 70% think that the
state and or Federal government should help prevent bankruptcy.
While just over half think that the electricity situation is a crisis, there
are clear signs that people take the situation seriously. When asked about
actions they have taken to reduce their electricity usage a majority report
taking basic steps like shutting off lights, reducing the temperature, and
cutting back on holiday lighting.
Looking forward, Californians will be replacing less efficient lighting and
taking other steps to make their homes more efficient. 11% state that they
will likely switch to another electricity supplier.
A full release including data tables is available at:
www.knowledgenetworks.com/press. The survey was completed by 529 California
head of household members of the Knowledge Networks panel, between Tuesday
January 9 and Thursday January 11, 2001. The margin of error for results
based on the total sample is plus or minus 4.4 percentage points.
About Knowledge Networks
Knowledge Networks' revolutionary single-source marketing information system
provides continuing insights about consumers' opinions, attitudes, activities
and behavior. Knowledge Networks is the first to combine traditional
statistically valid probability sampling with Web technologies to create a
panel that is representative of the U.S. population. The company equips all
panel households with interactive TV and Internet access enabling it to
collect a wealth of information with unusual speed.
Knowledge Networks, a privately held company, was founded in 1998 by two
Stanford Political Science Professors, Norman Nie and Douglas Rivers.
Knowledge Networks serves clients nationally from seven offices: Boston,
Chicago, Cincinnati, New York, Fairfield CT, Washington DC, and its
headquarters in Menlo Park, California.
For information on Knowledge Networks, please visit its Website,
www.knowledgenetworks.com.

Southern Calif Edison Projects Will Be Out Of Cash Feb 2

01/16/2001
Dow Jones News Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

WASHINGTON -(Dow Jones)- Southern California Edison, a subsidiary of Edison
International (EIX), said it will be out of cash on Feb. 2 based on its
current cash flow forecast, according to a Form 8-K filed Tuesday with the
Securities and Exchange Commission. , Southern California Edison had cash
reserves of about $1.2 billion, according to the filing.

08:49 AM
Southern California Edison said it estimates it has a $215 million payment
due to the California Power Exchange Tuesday, $259 million in payments to
qualifying facilities due through Jan. 31, a scheduled interest payment of
$230 million on maturing 5.875% notes due Tuesday and $255 million pyaments
for commercial paper due through Jan. 31.
The company also has total expenses for energy delivered as of Monday, but
not yet paid for, of $1.54 billion.
However, Southern California Edison states that due to a "significant lag
time" between the delivery of energy and the final billing, the actual
expenses through Monday can't be determined at this time.

Southern California Edison said that in an attempt to conserve cash it has
"temporarily suspended" payment of $230 million of principal and interest on
its 5.875% notes due Jan. 16, $215 million due to the California Power
Exchange due Jan. 16, $151 million due to certain qualifying facilities as
well as certain other unnamed obligations.
As reported, a company representative told Dow Jones Newswires Monday that
the company might not be able to make the payment to bondholders.
According to the company, failure to pay the notes when due constitutes a
default, allowing the noteholders to exercise remedies available to them.
Failure to make the payment on the notes also constitutes a default under
Southern California Edison's credit facilities, entitling the lenders to
exercise certain remedies.
If the company doesn't cure or waive the defaults within a specified time
period, the defaults may trigger defaults on all outstanding series of the
company's senior unsecured notes and subordinated debentures.
Failure to make the payment to the California Power Exchange constitutes a
default under the agreement, allowing the exchange to foreclose on collateral
pledged by the company.

According to the filing, Southern California Edison is attempting to avoid
bankruptcy and intends to pay all of its obligations once a solution to the
current liquidity crisis has been reached.
However, the company warns that it's possible that it could be forced into
bankruptcy.
Based on the ongoing "uncertainties," Southern California Edison and Edison
International intend to postpone releasing their financial results for the
fourth quarter and year-end 2000 "pending further developments in federal and
state regulatory proceedings, judicial proceedings, legislative enactments
and other efforts to resolve the current energy crisis," notes the filing.

Southern California Edison said in the filing that as of Dec. 31, the
difference between the cost of supplying electricity to customers and the
amounts received from customers reached $4.5 billion and "is continuing to
increase."
As reported, because of liquidity and other problems, the company has no
unused borrowing capacity under its existing credit facilities, and it's been
unable to arrange any additional facilities. In addition, the company is
unable to issue commercial paper or access the capital markets on "reasonable
terms."
On Jan. 4, the California Public Utilities Commission authorized a surcharge
for 90 days in an attempt to help Southern California Edison as well as PG&E
Corp. (PCG), which is also undergoing severe liquidity problems.
Southern California Edison said the rate increase provides "no real relief"
and will increase revenue by about $65 million a month during the three
months the surcharge is in effect.
Edison International is an energy holding company. Southern California Edison
provides electricity to people in California. -Todd Goren; Fed Filings/Dow
Jones; 202-628-9782

Calif Gov Could Stymie Solution To Crisis -FERC's Hebert

01/16/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

(This article was originally published Monday)
By Bryan Lee
Of DOW JONES NEWSWIRES

WASHINGTON -(Dow Jones)- High-level talks over the weekend on a plan to
rescue California's troubled two largest utilities and keep power flowing to
customers have brought participants no closer to a solution, sources involved
in the discussions said Monday.
And as events Tuesday are expected to push the state's financially ailing
electric utilities closer to bankruptcy, responsibility for the potential
meltdown rests squarely with California Gov. Gray Davis, a key federal energy
regulator said Monday.
"You've got a governor who cares more about being on a nighttime news show
than he does about fixing the problem in California," said Curtis Hebert, a
Republican on the U.S. Federal Energy Regulatory Commission.
Hebert criticized Davis, a Democrat, for his refusal to swallow the bitter
financial medicine needed to rescue the state's flawed power market
restructuring initiative.
Hebert's comments echo those voiced privately by industry officials and
Clinton Administration officials involved in unprecedented discussions
brokered by the White House since Tuesday.
The talks are designed to reach agreement on a plan that will allow the
state's utilities to continue purchasing power for their retail customers,
despite a liquidity crunch brought about by the state's power market
restructuring effort.
Broadly, the proposed deal involves having California's Department of Water
Resources enter into long-term power sales contracts on behalf of the
utilities. This would end the utilities' reliance on volatile spot markets
for power purchases.
In return, power generators are to grant some form of "forbearance" for the
money they are owed while the forward contracts are ironed out.
But throughout seven days of negotiations, Davis has refused to consider
raising state-protected retail rates and has resisted calls for the state to
issue credit guarantees for the utilities. In the meantime, Davis has
insisted that power suppliers agree to sell the state power under long-term
contracts at rates generators say is below their cost of production.
Unless Davis backs down, no rescue package can be struck, some people close
to the negotiations say.
"Everybody's still trying to talk, (but) now it's spinning out of control,"
said a person involved in the discussions.
A person representing power marketers and familiar with the status of the
talks: "I don't see any great cause for optimism - particularly when I hear
some of the things that Davis's office says." Governor's Office Rejects Talk
Of No Progress

A spokesman for the governor rejected the characterization that the talks
were stymied.
"People are working and moving forward," said Steve Maviglio, the governor's
spokesman. "If they weren't closer (to an agreement), they wouldn't still be
talking. To send a message to the markets that there's not progress here is
irresponsible."
Draft legislation to be unveiled Tuesday at the state Legislature will hold
up the governor's end of the deal, Maviglio said.
The legislation will give the state the authority to purchase power on behalf
of the utilities, and the structure of the long-term contracts will give the
utilities the ability to pay down the billions in uncollected power costs
they have accumulated to date, he said.
The utilities - Edison International's (EIX) Southern California Edison Co.
and PG&E Corp.'s (PCG) Pacific Gas & Electric Co. - say they have no cash on
hand and have been squeezed out of capital markets after hemorrhaging some
$12 billion buying high-cost wholesale electricity and selling it for a
considerable loss under state-mandated frozen retail rates.
Southern California Edison has a multimillion-dollar bill due Tuesday for
power purchases made in November and no cash on hand. Pacific Gas & Electric
says it can squeak by until early February, but obtained approval from
federal regulators on Friday for a corporate restructuring that will help
shelter its successful unregulated business units should the utility unit
files for bankruptcy.
Developments could come fast and furious if financial markets open Tuesday
with no deal struck.
Wall Street credit ratings agencies have warned they will downgrade the
utilities' debt to speculative, or junk-bond, status if a solution isn't
reached soon. And various entities are expected to file emergency petitions
with the Federal Energy Regulatory Commission to ensure that power keeps
flowing to the state despite the utilities' inability to purchase power for
their retail customers.
According to sources familiar with the discussions, one filing would allow
the Department of Water Resources to purchase wholesale power on behalf of
the utilities, while another would give Southern California Edison more time
to make good on amounts owed power suppliers.
Whether the regulatory filings buy the utilities time to avoid bankruptcy
remains to be seen.
"They've got to make some real decisions here," FERC's Hebert said of the
stymied negotiations with Davis. "If (Davis is) not willing to make those
decisions, then certainly I think he's to blame."
-By Bryan Lee, Dow Jones Newswires, 202-862-6647, bryan.lee@dowjones.com

Houston power supplier threatens to bankrupt California utilities

01/16/2001
Associated Press Newswires
Copyright 2001. The Associated Press. All Rights Reserved.

SACRAMENTO, California (AP) - In the midst of California's struggle to obtain
more regional power, a major electricity supplier is threatening to take the
state's two largest utility companies to bankruptcy court.
If Southern California Edison and Pacific Gas & Electric do not make payments
due this week, officials from Houston-based Dynegy Inc. said Monday they will
have no choice but to take them to court.
"If we can't get this bill through in the next two days, this will start to
unravel," Stephen W. Bergstrom, president of Dynegy, told the Los Angeles
Times. "When and if they (Edison) default on Thursday, it puts us in a
position where we have to take them into bankruptcy, and I'm sure others will
be right beside us."
Bergstrom refused to say how much money Dynegy is owed but said if any three
creditors jointly petitioned the court, it would be enough to start
involuntary bankruptcy proceedings.
State and federal lawmakers are trying to craft a temporary solution to
California's power crisis. Officials met this past weekend with electricity
wholesalers to negotiate a plan by California Gov. Gray Davis for the state
to buy electricity and sell it to utilities. That plan was to be introduced
Tuesday in the Legislature.
The state believes it can negotiate better prices than the utilities, which
have seen their credit ratings plummet in recent months. PG&E and SoCal
Edison say they have lost more than dlrs 9 billion because of wholesale price
increases and the state's 1996 deregulation law that froze rate hikes.
Electricity sellers have been increasingly reluctant to supply California
because of the utilities' dwindling finances.
Edison owes a major payment Tuesday to the Power Exchange, which manages the
wholesale buying and selling of electricity. Power industry sources estimate
the bill to be more than dlrs 150 million but believe the company has the
resources to make the payment. Technically, SoCal Edison will not be in
default on the payment until Thursday.
Company officials refused to comment on their obligations to the Power
Exchange. They said they would disclose details Tuesday in a filing with the
federal Securities and Exchange Commission.
PG&E officials said Monday that they would pay their dlrs 40 million bill due
this week. The utility has approximately dlrs 500 million in cash, a
spokesman said, with a bill for about dlrs 580 million due Feb. 1.
On Monday, the state's power reserves shrank to nearly 5 percent even though
many businesses were closed for the holiday.
Dynegy purchased three Southern California power plants when SoCal Edison,
PG&E and San Diego Gas & Electric auctioned off assets as part of
deregulation. The company's plants can generate enough electricity to supply
2.8 million homes.

California Utility's Power Supply Could Be Cut
By John R. Emshwiller and Mitchel Benson
Staff Reporters of The Wall Street Journal

01/16/2001
The Wall Street Journal
A4
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Today could prove to be a critical day in California's electricity crisis as
one of the state's biggest utilities, Southern California Edison Co., faces a
possible cutoff from power supplies.
Edison, a unit of Edison International Inc., is considering not paying a big
wholesale electric-power bill, believed to be in the hundreds of millions of
dollars, that comes due today from the California Power Exchange, a person
familiar with the matter said. Edison is suffering from a cash shortage
brought on by the skyrocketing cost of wholesale power. An Edison spokesman
declined to comment yesterday.
A spokesman for the Power Exchange said Edison could face immediate cutoff
from further purchases via the exchange if it doesn't pay its bill. However,
the exchange was talking with various parties in an effort to avoid such a
suspension. "We are still in negotiations. We don't know what we have yet,"
the spokesman said.
The Power Exchange, created as part of California's utility-deregulation
effort, serves as a crucial middleman between utilities and power generators.
Under deregulation, Edison obtains much of its daily electricity through the
exchange. An inability to buy through that venue could leave Edison and its
4.2 million customers in Southern California facing power shortages and
possible blackouts.
Adding to the financial uncertainty surrounding Edison, Dow Jones Newswires,
citing a senior Edison executive, reported late yesterday that the company
has a $200 million bond payment due today that it also might be unable to
pay.
Meanwhile, state officials met through the Martin Luther King Jr. holiday in
Sacramento in a frantic effort to resolve the power crisis. Within the next
24 to 48 hours, Wall Street and the energy producers "need a precondition, a
signal that we're serious and heading in a direction they're comfortable
with," said one lawmaker involved in the talks.
One idea proposed by Gov. Gray Davis and others is to have the state use its
financial resources to purchase power from electricity producers for resale
to the financially beleaguered utilities. "We don't have to go into business
tomorrow as the purchaser," the lawmaker said. "We simply have to make a
strong enough and substantive enough statement coming out of the state
capitol so that the creditors and [energy] producers will exercise
forbearance." Such forbearance would give utilities more time to pay billions
of dollars of wholesale power costs that they have accrued but haven't been
able to collect from customers through rates.
Several people involved in yesterday's talks said they were optimistic that
some plan would be ready to present to a legislative committee today for
public hearings and, potentially, a vote in the Assembly. They acknowledged
that as of late yesterday that no agreements had been reached with
electricity producers on such crucial issues as the price to be charged for
the electricity and the length of the supply contracts. California's
Legislature has been called into special session by Gov. Davis to consider a
series of bills aimed both at improving the state's electricity supply and at
curtailing demand.
Edison's move on its Power Exchange bill could compress the timeframe for
action. Many observers believed the utilities had sufficient cash to see them
through early February, when another round of big wholesale electric bills
comes due.
Last weekend, the Pacific Gas & Electric utility unit of PG&E Corp.
reiterated its belief that it has sufficient cash to pay its expenses until
early February. In recent weeks, Edison and PG&E have said they are being
pushed to the brink of insolvency and bankruptcy-law filings because of
skyrocketing wholesale electricity costs.
Some observers speculate that if Edison doesn't pay its Power Exchange bill,
it could be a signal that the utility is moving closer to a bankruptcy-law
filing. Richard Cortright Jr., a Standard & Poor's director, said an analysis
by the credit-ratings concern indicates that Edison has enough cash to pay
the Power Exchange. Preserving cash by not paying bills "is often a tactic a
company uses before bankruptcy," Mr. Cortright said.
S&P and other ratings concerns have been closely following the California
electricity crisis, because of the impact it could have on billions of
dollars of utility bonds outstanding. The ratings concerns have severely
downgraded both Edison and PG&E bonds. The agencies generally haven't dropped
those bonds into "junk- bond" status, which is below investment grade. Such a
downgrade would put the utilities into various financial defaults that could
exacerbate their acute cash problems.
While the California situation is "incredibly fluid," any failure by Edison
to pay its power bills "paints a very, very dire picture," Mr. Cortright
said.
To better understand the current picture, state legislative leaders have
recruited several legal and financial advisers. Among them is David Wiggs,
managing director of Lido Capital in Newport Beach, Calif., a financial
adviser to the utility and telecommunications industries. Mr. Wiggs, who has
been hired to advise the newly created Assembly Committee on Energy Costs and
Availability, is a retired chairman of the utility El Paso Electric Co. Mr.
Wiggs, in turn, has hired to assist him Robert D. Albergotti and Stacey
Cowand Jernigan, members of the Dallas law firm of Haynes & Boone. Two
investment advisers from New York investment bank Credit Suisse First Boston
Corp. are advising legislators on a pro bono basis.
As regulators, politicians and executives struggled to come up with fixes,
California itself struggled through another day of tight power supplies.

Metro Desk
Power Firm Demands Utilities Pay Bills Now Electricity: Supplier says it will
haul Edison and PG&E into bankruptcy court if money isn't forthcoming.
Lawmakers scramble for a solution.
NANCY VOGEL; MIGUEL BUSTILLO
TIMES STAFF WRITERS

01/16/2001
Los Angeles Times
Home Edition
A-1
Copyright 2001 / The Times Mirror Company

SACRAMENTO -- Increasing the pressure on state lawmakers to craft at least a
temporary solution to California's power crisis, a major power supplier
threatened Monday to force Southern California Edison and Pacific Gas &
Electric into bankruptcy court unless the utilities pay their bills due this
week.
The move by Dynegy Inc. of Houston upped the ante on a day when legislators
huddled with financial experts and lawyers but reached no agreement on a
mechanism for the state to buy electricity for Edison and PG&E at rates far
lower than they pay now--allowing the beleaguered utilities breathing room to
restructure their massive debts.
"If we can't get this bill through in the next two days, this will start to
unravel," said Stephen W. Bergstrom, president of Dynegy. "When and if they
[Edison] default on Thursday, it puts us in a position where we have to take
them into bankruptcy, and I'm sure others will be right beside us."
Bergstrom refused to say how much money Dynegy is owed, but said if any three
creditors jointly petitioned the court, it would be enough to start
involuntary bankruptcy proceedings.
Under a plan outlined this weekend by Gov. Gray Davis after marathon
bicoastal negotiations, the state would use its excellent credit rating to
purchase electricity and then resell it to debt-hobbled utilities.
The state Department of Water Resources has stepped in on an emergency basis
to buy power to prevent blackouts, but Davis' plan would, overnight, make
California the biggest single buyer of electricity in its own market.
Legislators generally backed the need for the state to buy power, but there
has been no agreement on two key issues: the price and the duration of the
contracts. The price needs to be low enough so that utilities, with the rates
currently in place, can save enough to restructure their debts--but high
enough so that the power producers will go along with the plan.
With attention focused on how Wall Street will view the tenuous agreement
when markets reopen after the weekend, legislators were fighting multiple
deadlines in trying to make good on the weekend promise to pass a bill by
today.
Edison owes a major payment today to the Power Exchange, the market created
in 1998 under deregulation.
Power industry sources say they believe Edison has the cash to make the
payment, estimated at more than $150 million, but that the firm could play
high-stakes political poker by delaying payment to increase pressure on
lawmakers. Technically, Edison will not be in default on the payment until
Thursday.
Edison officials refused to comment on the negotiations with state leaders or
the firm's obligations to the Power Exchange. They said they would disclose
details today in a filing with the federal Securities and Exchange
Commission.
PG&E officials said Monday that they would pay their $40-million bill due
this week. The utility has approximately $500 million in cash, a spokesman
said, with a bill for about $580 million due Feb. 1.
Electricity sellers have been increasingly reluctant to supply California
because of the deteriorating financial condition of the utilities.
The volume of electricity traded in the Power Exchange has dropped by roughly
75% in the last month. Grid operators have struggled daily to buy enough
power to balance flow on high-voltage wires and prevent blackouts.
On Monday, a holiday during which many offices and businesses were closed,
the state's power reserves shrank to nearly 5%.
Legislators, convened in an emergency session on the state's energy crisis,
quickly seized on Davis' idea.
"We're working here around the clock, doing everything we can," said Assembly
Speaker Bob Hertzberg (D-Sherman Oaks) during an afternoon break in talks
among a half-dozen Republican and Democratic lawmakers. Also involved were
the state's finance director, a bankruptcy lawyer, and two utility experts
from Credit Suisse First Boston.
Their purpose was to craft a skeleton of the legislation that California will
need to implement Davis' proposal and have it passed by at least one house of
the Legislature today.
Senate leader John Burton (D-San Francisco) has said that while the
Legislature works, power generators should be willing to give utilities
leeway on bills coming due.
But that's unlikely unless the Legislature acts quickly, said Bergstrom of
Dynegy. His company purchased three Southern California power plants when
Edison, PG&E and San Diego Gas & Electric auctioned off assets as part of
deregulation. Dynegy's plants can generate enough electricity to supply 2.8
million homes.
"We're just not going to do that," Bergstrom said, "because the stakes are
too high."
He met with Davis and California lawmakers in Washington, D.C., last Tuesday
evening and spoke to them again through a bicoastal video conference
Saturday. The governor has been lobbying power plant owners to sign long-term
contracts with the utilities at roughly 5.5 cents per kilowatt-hour--well
below the recent market rate of 30 cents.
Power plant owners call that price unrealistic unless the contract lasts at
least six or seven years, allowing them to recoup money later, when the cost
of natural gas is expected to fall and make electricity cheaper to generate.
Contract details do not matter, Bergstrom said, so long as the utilities are
so debt-ridden as to be unworthy of credit. That's why the state needs to
step in to buy power and guarantee payment, he said.
But some lawmakers have downplayed the urgency.
Burton has said it is more important to get the details of a bill right than
to move quickly.
To insert the state as a go-between in California's electricity market raises
many complex financial and political issues.
Even lawmakers who support helping the utilities insist that consumers get
something in return.
Stock options, ownership of utility transmission lines or takeover of
hydroelectric power plants--a cheap source of power that affects the
environmental health of many Sierra Nevada rivers--are among the assets the
state should consider, Burton said.
Hertzberg spokesman Paul Hefner said lawmakers have included bankruptcy
lawyers and financial experts not solely to impress Wall Street, but also
because they realize they are entering a realm they know little about.
He said politicians clearly want to "send a message to financial markets"
that they are working with industry experts when considering the consequences
of their legislation.
But he said their main goal is to get technical advice from someone who is
not a bureaucrat and is not employed by a power firm.

Metro Desk
Court May Decide if Power Users Pay More Court: Edison calls ruling that it
can pass on costs a victory. The PUC says it's just the first of many steps
in the battle over setting rates.
HENRY WEINSTEIN
TIMES LEGAL AFFAIRS WRITER

01/16/2001
Los Angeles Times
Home Edition
A-15
Copyright 2001 / The Times Mirror Company

A federal judge's recent ruling that Southern California Edison Co. has the
right to pass on to consumers its costs of acquiring power on the wholesale
market does not mean that ratepayers will have to bear any of those costs
soon.
But the decision nonetheless provided immediate benefits to the beleaguered
utility--primarily making the company look more financially secure and
credit-worthy because the ruling could pave the way for a recovery of more
than $2 billion for Edison.
Consequently, attorneys and spokesmen for Edison trumpeted the ruling of U.S.
District Judge Ronald S.W. Lew as a significant victory. Attorneys for the
California Public Utilities Commission played down the decision's
consequences, saying it was merely the first skirmish in a long process.
Regardless of how significant Lew's ruling was, the legal battle clearly has
important ramifications, and they go beyond Edison's financial health.
Ultimately, the case, titled Southern California Edison vs. Loretta M. Lynch
(president of the PUC), may determine whether Edison's customers have to pay
more for electricity.
Moreover, the case--and a virtually identical one filed by Pacific Gas &
Electric Co. in Oakland federal court--may clarify whether there will be any
change in the traditional demarcation of regulatory authority over utilities
as a result of deregulation.
Historically, the federal government has regulated wholesale power rates and
state governments have regulated retail rates, those charged to consumers.
One of the key issues in the Edison and PG&E cases is the utilities'
contention that a PUC-imposed rate freeze violated the traditional
demarcation by indirectly interfering with federal regulatory authority.
Both companies say that they have been prevented from recovering their
wholesale purchase costs because of the rate freeze imposed by the PUC as
part of the massive utility deregulation law enacted in 1996, known as AB
1890.
Unless the issues are resolved by legislative action on the state energy
crisis, it seems likely that the two suits will wind up in the U.S. 9th
Circuit Court of Appeals and perhaps ultimately the U.S. Supreme Court. The
California Public Utilities Commission and the Utility Reform Network, a
consumer advocacy group, are opposing the companies in court.
The 1996 deregulation law provides that the California rate freeze lasts
until March 31, 2002, or until what are known as a utility's "stranded costs"
(in essence, certain assets such as nuclear power plants that were overvalued
in 1996) are recovered. The PUC determined last year that San Diego Gas &
Electric, the state's other major privately owned utility, had recovered its
"stranded costs," enabling that company to impose rate hikes. But the agency
has said that Edison and PG&E are not entitled to take such action yet.
On Jan. 8, Judge Lew agreed in principle with Edison's contention that the
Federal Power Act trumps California's 1996 energy deregulation law.
Lew rejected the PUC's argument that he should dismiss the case because
retail rates are exclusively a matter of state regulation. The judge also
rejected the agency's alternative request that he defer a decision for at
least 120 days while the PUC gathered more facts. The judge said the gravity
of the situation required immediate action.
PUC actions "are having devastating effects on [Edison's] current ability to
obtain financing to enable it to continue to procure wholesale power at
current prices," Lew said.
In essence, Lew agreed with Edison's lawyers, Ronald L. Olson and John W.
Spiegel, that the company is caught in "a vise that threatens to squeeze it
out of existence."
"On the one side, SCE has been forced to pay astronomically high prices to
buy wholesale electricity," the lawyers said in a brief filed in Lew's court.
The 1996 statute requires SCE "to procure all of the electricity needed to
serve its 4.3 million retail customers from two wholesale market
institutions, whose pricing practices are exclusively within the Federal
Regulatory Commission's jurisdiction. Since last June, the cost of procuring
electricity through these market institutions has increased nearly
four-fold," the attorneys said.
"On the other side, SCE has been unable to recover these expenses through
retail rates, which are currently frozen under California law." In addition,
Edison's lawyers maintain that the PUC has interpreted California law "to
prohibit SCE from recovering these costs, either now or in the future."
Consequently, Edison has had to buy high and sell low, leaving it with a
shortfall in excess of $2.6 billion, the company says.
The PUC counters that a substantial portion of Edison's costs are paid to
itself from power the company buys from its own plants and that Edison has
reaped additional billions in the last two years from the sale of certain
assets. The agency contends that those funds should be available to offset
the financial problems the company is complaining about.
The PUC also contends that Edison failed to take other steps that could have
lowered its costs in acquiring power.
In addition to the dispute over the facts, there has been a clash over Edison
's contention that California's rate freeze interferes with federal
regulation of the wholesale energy market. The PUC and the Utility Reform
Network counter that the freeze is an essential component of the Federal
Regulatory Commission's approval of wholesale sales.
The regulatory commission has taken no formal position on the pending
litigation. However, Douglas W. Smith, the agency's general counsel, sent a
letter to Edison attorney Spiegel saying that the "filed rate doctrine"
applies in a situation such as this. The doctrine, according to a 1986 U.S.
Supreme Court decision, holds that interstate power rates filed with the
Federal Regulatory Commission or set by it must be given binding effect by
state utility commissions determining intrastate rates.
However, Michael Strumwasser, attorney for the consumers group, said the 1986
Supreme Court decision arose in an entirely different context. He said the
specific question now at issue--whether the "filed rate doctrine" applies
when wholesale rates have been set by market forces rather than a regulatory
proceeding--has never been ruled on by an appellate court.
Lew made no explicit rulings on the PUC allegations that Edison should have
offset wholesale payment costs through other revenues.
However, Lew said the PUC is entitled to present evidence about the prudence
of Edison's wholesale electricity purchases. Further hearings on that issue
could determine how much of its costs Edison is entitled to recover. The PUC
contends that Edison could have made some purchases at lower prices than it
did. But Edison attorneys counter that this is a disingenuous argument,
because the PUC has not objected to the prudence of Edison's purchases.
Indeed, the Edison lawyers say the next phase of the case should be very
brief because the PUC, in effect, consented to Edison's prior actions.
Attorneys for the PUC and the consumers group disagree sharply, saying a bevy
of issues need to be reviewed in detail. There is no timetable for further
proceedings in the Edison case. The next hearing on the PG&E case is
scheduled for Jan. 30 in Oakland.

NEWS
Stealthy Deal Protects Profits of PG&E's Parents
Christian Berthelsen
Chronicle Staff Writer

01/16/2001
The San Francisco Chronicle
FINAL
A1
(Copyright 2001)

PG&E Corp. has quietly won approval from federal regulators to restructure
itself in a way that shields the parent company's profits, and shareholders,
from the mounting debts of the utility it owns.
The move appears to allow Pacific Gas and Electric Co.'s parent to record
substantial profits while maintaining that its subsidiary, which supplies
power to 4.5 million customers, is teetering on the edge of bankruptcy and
trying to force ratepayers to pick up the tab.
The corporate restructuring, approved by the Federal Energy Regulatory
Commission on Friday, came as a surprise to consumer advocates and state
leaders dealing with the energy crisis -- including Gov. Gray Davis. They
have been working feverishly the past seven days to construct a deal that
would alleviate debt pressure on PG&E and Southern California Edison by
having the state of California buy power and provide it to the utilities at
cost.
Steve Moviglio, a spokesman for Davis, said the governor was displeased by
PG&E's move, although he said it was not likely to derail the state's efforts
to intervene in the crisis. He also said Davis was "disappointed that FERC
acted in the middle of the night without notice to all parties."
Ratepayer advocates and even some state officials have said that any aid to
the ailing utilities should be offset by the huge profits that PG&E Corp. has
made during the crisis from electricity generation and trading revenues. The
money has certainly flowed in the other direction, they argue. In the past,
PG&E Corp. has used revenues from the utility to pay down corporate debt, pay
stock dividends and buy assets in other states.
PG&E Corp.'s action appears to eliminate that possible means of paying off at
least part of the $2 billion in debt incurred since November by its utility,
Pacific Gas and Electric Co., as it bought power at prices higher than it can
legally charge customers.
"It's certainly a response to them feeling the threat that the holding
company's going to be held responsible for all this," said Bob Finkelstein,
an attorney for The Utility Reform Network, an advocacy group.
Meanwhile, California's energy crisis continued in full force yesterday, as
the California Independent System Operator issued a Stage Two emergency,
meaning that demand had reached within 5 percent of the state's electric
supply, prompting requests to certain large users to shut down and conserve
power. This occurred despite a national holiday, Martin Luther King Day, on
which most businesses were closed and demand was forecast to reach about
30,000 megawatts, a fairly modest number.
Further, conditions appeared as if they were going to worsen imminently.
Edison said it will be unable to pay bills coming due today, and PG&E said it
has only about $500 million on hand to cover what it owes. Bankruptcy filings
by both utilities appeared more likely.
State leaders were still in negotiations yesterday to broker a deal in which
California's Department of Water Resources would step in and buy power on
behalf of the utilities, who are facing a growing inability to pay for their
purchases. The talks were reported to be breaking down, however, because
Davis refused to consider raising California rates or backing utility debts
with a letter of credit from the state.
In San Francisco, state Senate President Pro Tem John Burton said legislation
passed last week by the Assembly will probably make its way to the governor's
desk by the end of the month. One bill would change the makeup of the boards
that oversee the state's power market, and the other would prohibit utilities
from selling off their power-generating assets.
In the midst of yet another Stage 2 electrical emergency the Democratic
leader said, "I want the people of California to have long, stable, available
energy throughout the rest of our lives."
But in the short term, with the threat of rolling blackouts and urgent
requests for power conservation, Burton stated the obvious: "Turn the goddamn
lights off," he said.
NO CHALLENGES TO RESTRUCTURING
The Federal Energy Regulatory Commission approved PG&E's restructuring plan
on a 3-to-1 vote on Friday. It was apparently described in a Dec. 28 public
notice as a stock transfer, and thus flew under the radar screens of most
observers. Details of the plan were first reported in the Wall Street Journal
on Monday.
Greg Pruett, a spokesman for PG&E Corp., said the intent of the plan was
merely to allow another unit of the corporate parent, National Energy Group,
to receive its own credit rating that would be weighed independently of the
troubled utility. But he acknowledged that all or nearly all of PG&E Corp.'s
assets outside the utility are held by National Energy Group and that the
move would reduce the liability for the corporation.
Although it was unclear whether PG&E informed state leaders of its plans,
Pruett said the notice of the meeting was publicly available and had at least
been provided to the Public Utilities Commission.
In addition to proceeds from the sale of power plants and other revenues that
PG&E has forwarded on to its corporate parent, the utility has reaped
windfall profits during the crisis from the generation and sale of
electricity and has not applied those profits to its own debt. To do so would
require an accounting rule change by the California Public Utilities
Commission, but company officials have maintained that should not be done.
PG&E IN DEBT TO ITSELF
Critics say that PG&E is its own biggest debtor, with money flying out of one
pocket and into the other and that nearly half of its debt is owed to itself.
In the third quarter of 2000, the company reported a 22 percent increase in
profits, with a net income of $225 million, while saying it expected
California consumers to eventually pick up the tab for its debt.
--------------------------------- ON TAP TODAY -- Shortage: Electricity
demand is expected to grow as Californians return to work from a three-day
weekend, increasing the likelihood of energy emergencies. -- Talks: Energy
officials huddle in Washington and Sacramento over Gov. Gray Davis' plan for
the state to buy energy for the beleaguered utilities. -- Credit: If Wall
Street doesn't like the plan to rescue the state's ailing utilities, it may
begin downgrading stock and bond ratings - even to "junk" status. --
Payments: Southern California Edison has a multimillion dollar bill coming
due, but the company says it has no money to pay.


Shirley,

Can you copy and paste it and send it to the entire group?

Vince

---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 06/29/2000
01:54 PM ---------------------------

Robert Brooks <rebrooks@earthlink.net> on 06/29/2000 01:09:15 PM
Please respond to "rebrooks@rbac.com" <rebrooks@rbac.com>
To: "'GPCM Distribution'" <rebrooks@rbac.com>
cc:
Subject: FW: Just a bit of history on this 4th of July!

Subject: Our Fourth of July

Have you ever wondered what happened to the 56 men who signed the
Declaration of Independence?

Five signers were captured by the British as traitors, and tortured before
they died.

Twelve had their homes ransacked and burned.

Two lost their sons serving in the Revolutionary Army; another had two sons
captured.

Nine of the 56 fought and died from wounds or hardships of the Revolutionary

War.

They signed and they pledged their lives, their fortunes, and their sacred
honor.

What kind of men were they?
Twenty-four were lawyers and jurists. Eleven were merchants, nine were
farmers and large plantation owners; men of means, well educated. But they
signed the Declaration of Independence knowing full well that the penalty
would be death if they were captured.

Carter Braxton of Virginia, a wealthy planter and trader, saw his ships
swept from the seas by the British Navy.  He sold his home and properties to

pay his debts, and died in rags.

Thomas McKeam was so hounded by the British that he was forced to move his
family almost constantly. He served in the Congress without pay, and his
family was kept in hiding. His possessions were taken from him, and poverty
was his reward.

Vandals or soldiers looted the properties of Dillery, Hall, Clymer, Walton,
Gwinnett, Heyward, Rutledge, and Middleton.

At the battle of Yorktown, Thomas Nelson Jr, noted that the British General
Cornwallis had taken over the Nelson home for his headquarters.  He quietly
urged General George Washington to open fire. The home was destroyed, and
Nelson died bankrupt.

Francis Lewis had his home and properties destroyed.  The enemy jailed his
wife, and she died within a few months.

John Hart was driven from his wife's bedside as she was dying. Their 13
children fled for their lives. His fields and his gristmill were laid to
waste. For more than a year he lived in forests and caves, returning home to

find his wife dead and his children vanished. A few weeks later he died from

exhaustion and a broken heart.

Norris and Livingston suffered similar fates.

Such were the stories and sacrifices of the American Revolution. These were
not wild-eyed, rabble-rousing ruffians. They were soft-spoken men of means
and education. They had security, but they valued liberty more.  Standing
tall, straight, and unwavering, they pledged: "For the support of this
declaration, with firm reliance on the protection of the divine providence,
we mutually pledge to each other, our lives, our fortunes, and our sacred
honor."

They gave you and me a free and independent America.  The history books
never told you a lot about what happened in the Revolutionary War.  We
didn't fight just the British. We were British subjects at that time and we
fought our own government!

Some of us take these liberties so much for granted, but we shouldn't.  So,
take a few minutes while enjoying your 4th of July holiday and silently
thank these patriots. It's not much to ask for the price they paid.
Remember: freedom is never free!  Patriotism is NOT a sin, and the Fourth of
July has more to it than beer, picnics, and baseball games.
something to think about...


Joe:

Attached are the revised confirms for AIG Commodity Arbitrage Fund L.P. (V41967.5) and AIG Commodity Arbitrage Fund Ltd. (V41967.4).

Let me know if you have any questions or need anything else.

Marie
x33907


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[IMAGE]	[IMAGE]	[IMAGE]	[IMAGE]	Politics this week
				June 7th 2001
				From The Economist print edition

				Ceasefire at last?

				AP
				AP

				A Palestinian suicide-bomber killed 20 Israeli youngsters at a Tel Aviv
discotheque. Israel held back from massive retaliation after Yasser Arafat
committed his forces to an unconditional ceasefire. George Tenet, the CIA,s
director, arrived to help promote this tentative pause in the violence, but a
Hamas spokesman denied that there was a ceasefire.

				See article: A fragile Israeli-Palestinian ceasefire [IMAGE]

				The king of Nepal and nine other members of the royal family were shot dead,
apparently by the crown prince, Dipendra. He later died from self-inflicted
wounds. Curfews were introduced in the capital, Katmandu, after riots by
Nepalis confused by contradictory stories and demanding the truth about the
killings.

				See article: After the palace massacre in Nepal

				Makiko Tanaka, Japan,s outspoken foreign minister, embarrassed her government
by expressing doubts about President George Bush,s missile-defence plans.

				Voters decide

				Voters in Britain went to the polls in a general election, which Tony Blair,s
Labour Party looked likely to win easily. Harder questions: would William
Hague survive as leader of the opposition Tory party? And would Mr Blair call
a referendum on the euro next year?

				See article: Labour's second term

				AP
				AP

				Alejandro Toledo, an economist of Andean Indian descent, was elected
president of Peru, narrowly defeating Alan Garcia, a populist former
president.

				See article: The tasks awaiting Alejandro Toledo [IMAGE]

				Ireland held a referendum on the European Union,s Nice treaty, with the
once-confident Yes side still expecting victory but worried by a sudden rise
in support for No in the opinion polls.

				Silvio Berlusconi was formally invited by Italy,s president to form its new
government.

				In the unrecognised but rather successful state of Somaliland, a huge
majority voted in favour of independence from the rest of Somalia.

				James Hahn, the city attorney, won a run-off to become the new mayor of Los
Angeles, beating his fellow Democrat, Antonio Villaraigosa, who had hoped to
be the city,s first Latino mayor since 1872.

				See article: A new mayor for Los Angeles

				Haiti,s president, Jean-Bertrand Aristide, agreed to hold new parliamentary
elections. In return, the Organisation of American States said it would help
Haiti obtain $500m of suspended aid.

				Democrats officially took control of the United States Senate for the first
time in six years. The Democratic leader, Tom Daschle, promised to adopt a
co-operative approach towards the Republican agenda.

				War and peace

				Fighting continued in Bangui, the capital of the Central African Republic,
after last week,s failed coup against President Ange-F,lix Patass,.

				See article: The Central African Republic erupts

				In Colombia, the FARC guerrillas and the government began an exchange of sick
prisoners, the first practical result of more than two years of peace talks.

				See article: A modest peace deal in Colombia [IMAGE]

				Prime Minister Ljubco Georgievski again threatened to declare a formal state
of war in Macedonia after ethnic-Albanian rebels, seeking to widen the
conflict to an area hitherto unaffected, killed five government soldiers
north-west of Skopje, the capital.

				Visiting Europe, America,s defence secretary, Donald Rumsfeld, reassured NATO
allies that no hasty reduction of American forces was planned in the Balkans.
President Bush said that America would reopen talks with North Korea, broken
off three months ago, to discuss missiles, nuclear concerns and conventional
forces.

				See article: Difficult times in America's relations with Europe [IMAGE]

				A deal seemed near to overcoming Turkish objections to NATO co-operation with
the European Union,s rapid-reaction force.

				Nine of the 20 hostages held by Muslim rebels in the Philippines escaped
after fighting between their Abu Sayyaf captors and Philippine troops.

				Chenjerai Hunzvi, the leader of Zimbabwe,s &war veterans8, died of malaria.
Calling himself Hitler, he had led violent attacks on Robert Mugabe,s
opponents and encouraged the occupation of white-owned farms. Mr Mugabe
declared him a national hero.

				Legal matters

				AP
				AP

				France,s prime minister, Lionel Jospin, admitted that he had belonged to a
Trotskyite organisation*a fact he had previously denied.

				See article: France's prime minister has a past [IMAGE]

				President Vojislav Kostunica of Yugoslavia appealed to his allies in a
Montenegrin party not to block a draft law that would allow ex-President
Slobodan Milosevic to be extradited to The Hague for war crimes.

				See article: Serbia and Slobodan Milosevic's fate [IMAGE]

				An American federal judge ruled that the execution to Timothy McVeigh, the
convicted Oklahoma City bomber, would go ahead on June 11th. Lawyers for Mr
McVeigh had argued that they needed more time to look at documents withheld
by the FBI during the trial.

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...more from Mr. Shurkis.  When we get the example, Gloria will make the comparison to current wording.  Also, do we expect 2001 revenues to be at the same level?  If not, perhaps we can negotiate a lower level.

 -----Original Message-----
From: 	"Shurskis, James" <Shurskis@puc.state.pa.us>@ENRON
Sent:	Friday, November 16, 2001 9:35 AM
To:	Kingerski, Harry
Subject:	Bonding Issues

I also need to discuss issues concerning the bonds Enron Power Marketing and
Energy Energy Services maintain for their electric licenses.

Neither bond meets the current wording requirements of the Commission.  They
both need updates to the wording for the priority of claims, the number of
days required to cancel the bond, and the number of months in which to make
a claim.  I will email or fax an example of the standard bond language.

Also, per Commission records, Enron Energy Services had revenues of
$38,704,087 for the last reported year, 2000.  Therefore, the Commission
expects a new bond of $3,870,409.  Per our records, a $250,000 bond is still
satisfactory for Enron Power Marketing.


Eric, we need more than $2M saving to get this deal to clear the hurdle.  I
think we need to get to $350 to $400/kw firm including IDC to make this
viable.  Please ensure that NEPCO is working to figure out the disconnect.

Regards
Delainey


richard greenberg @ opic left me a message to confirm his availability for a
call tomorrow.  they are:
1-2 pm  (EST) or 4:30 - 5 pm (EST) which tentatively works for us here in
houston.  scott please confirm with  richard @ GE to get him on the line as
well.

jmg

 -----Original Message-----
From:  Reblitz, Scott
Sent: Monday, May 14, 2001 5:49 PM
To: Jeff Dasovich@EES
Cc: Galan, Joseph M.; Dutt, Ranabir
Subject: Turbine Export Issue

Jeff:  We are going to have a call with OPIC tomorrow to discuss the turbine
export issue and the state of affairs in the California re power.  The two
times that OPIC people are available are 11:30-2:00 and 4:30-5:30 (both times
are eastern standard time).  Does one of these slots appear better for you?
I don't anticipate that you would be needed for the entire time allotted for
the call but I'm sure the OPIC people will have some questions requiring your
knowledge of California.  Attached, please find a summary document we're
working on containing talking points we want to convey to OPIC.  Again,
thanks for your help, Scott

 << File: EletroboltExImSherman.doc >>


Deal # 157288
Per our conversation yesterday afternoon, pls. separate the Centena term deal
from the spot deal in Sitara for March 2000 production.
Also, I need to have the price for the East Texas redelivery changed in
Sitara from HS Index $-.085 to HS Index $-.0825.  This is per the contract
the price for this redelivery point.

Thanks
Katherine
5-8643


fyi -- if you have any questions or need assistance, please let either Scott, Joe or myself know.

Robert is the evening person this week.

Thanks.
 -----Original Message-----
From: 	Forbish, Sherry
Sent:	Monday, January 07, 2002 8:05 AM
To:	Cara Vaughan (E-mail); Chris Greaney; Debra Scurlock; Harry Woodson; Janet McDaniel; Jean Adams; Joe Linhart; Kathy Sturr; Randy Janzen; Robert Benningfield; Scott Hibbard; Sherry Forbish
Subject:	Randy J.

Randy called in this morning -- he's still not feeling well and won't be in today.


Wed. 1/2	Thur. 1/3	Fri. 1/4
Allen, Phillip	in	out	out
Arnold, John	in	in	in
Belden, Tim	in	in	in
Black, Don	in	in	in
Calger, Chris	in	in	in
Davis, Dana	in	in	in
Duran, Dave	in	?	?
Grigsby, Mike	in	in	in
Lagrasta, Fred	in	in	in
Luce, Laura	in	in	in
Martin, Tom	in	in	in
Milnthorp, Rob	out	in	in
Neal, Scott	in	in	in
Presto, Kevin	in	out	out
Redmond, Brian	in	out	out
Shively, Hunter	in	in	in
Sturm, Fletch	in	in	in
Tycholiz, Barry	in	in	in
Vickers, Frank	out	?	?
Zufferli, John	in	in	in

Tammie Schoppe
Enron Americas-Office of the Chair
Assistant to Louise Kitchen
713.853.4220 office
713.646.8562 fax
713.253.2131 mobile


517814 - added .0075 fee per Chris Mallory

535228 - I'm waiting for Tom's desk to settle down a bit - they're in the
middle of trading.

Any idea why APB's just checking these deals out now? They're from the
beginning of February. Just wondering.

Thanks,
Kate

Kerri Thompson@ENRON
03/26/2001 01:08 PM
To: Kate Symes/PDX/ECT@ECT
cc:

Subject: apb fees

kate can you check on these 2 deals

517814 broker has fee of .0075

535228 broker has fee of .0075

thanks


This request has been pending your approval for  4 days.  Please click http://itcapps.corp.enron.com/srrs/auth/emailLink.asp?ID=000000000076513&Page=Approval to review and act upon this request.

Request ID          : 000000000076513
Request Create Date : 11/19/01 8:37:30 AM
Requested For       : scott.tackett@enron.com
Resource Name       : Sitara Houston Production Central Edit Logistics
Resource Type       : Applications


We are looking at buying several paper companies.  I think you should send
them to me.  Thanks.  Mark


The following reports have been waiting for your approval for more than 4 days.  Please review.

Owner: Jane M Tholt
Report Name: November 21, 2001
Days In Mgr. Queue: 5


Optimization/ Facility Planning Team Weekly Report
Week of September 25 - 29, 2000

ET&S Outages  (Outages: Jerry Graves  713/345-8923)

System Optimization Team  (Team Leader: Ben Asante  713/853-9432)

TW Fuel Performance Measurement Model (FPM)
Working with the SCADA support group to identify the equivalent SCADA points
to existing MIPS Points, for conversion of the model to a real-time basis. An
initial query revealed that only ~50% of MIPS points have a SCADA
equivalent.  Priority will be given to identification/addition of points on
the San Juan Lateral and the Thoreau Junction to Needles.

Developing an estimate of the time required to complete the conversion of the
FPM Model to a real-time basis.

TW Fuel Performance Measurement for Fuel Overage Forecasting
The Revenue/Risk Management group are analyzing the existing FPM model
groupings to evaluate the use of our model in combination with their demand
model.  The combined model would provide fuel burned on forecasted demand.
Initial analysis looks promising and they hope to give us an answer by next
week whether the FPM model can be used as is.

Beaver to Mullinville B-C Sweeping
 Pipeline operating conditions have been analyzed since the sweep was
completed on 09/21/00.  Recent sweeps had improved flow efficiency only about
5%.  Last week's sweep improved the efficiency by 35% to about 85%.  Pressure
drops decreased from 125 PSI down to about 40 PSI.  Mullinville has operated
with one less 2000 HP unit while Beaver units are operating with less load
while producing lower suctions.

Outage Modeling
Ran hydraulic models for Gas Control to determine flows with Bisti down and
with Unit 303 down.

San Juan Efficiency Study
Developed multiple scenarios for San Juan flows and pressures if the line was
to be cleaned.  Basic economic analysis was also performed.

Hydraulic Model for EOTT
The current EOTT hydraulic model has been revised to include the dependence
of the fluid properties on temperature and pressure as well the appropriate
heat transfer considerations.

Houston Facility Planning Team    (Team Leader: Perry Frazier 713/853-0667)

TW Expansion Studies
Looked at different combinations of pipe loop and compression trying to
reduce overall costs.  No luck so far.  A brainstorming session is scheduled
next week to see if there are any different approaches not considered to date.
El Paso Field Services
Compiling information for inclusion into the Interconnect and Operating
Agreement between EPFS and Enron.  Mostly locations, materials and POI
number, expect to have all information gathered by the end of the week.

San Juan Lateral
Enron Operations Services has visited 3 laboratories in the area and compiled
information on their analysis procedures.  They want Facility Planning to
help evaluate and choose one for the sample evaluation.  Results will take
about 2 weeks.  Also, received some expected flow/pressure enhancements for
the last 30 - 40 miles of the SJ Lateral, using the expected efficiencies
calculated for a pressure profile taken after the 1998 chemical cleaning
run.   Results will be reported next week.

Liberal Operations - PRIDE Meeting
Attended operations meeting in Liberal that covered various areas of
operations and ways to improve.  Facility Planning did a presentation on the
proposed Emergency Response Program and provided general information on
Facility Planning services that can assist Operations.

Prospective Market Zone Wichita, Kansas
Commercial requested market study of competitor pipelines serving the
Wichita, Kansas area (Duke, KPL, Williams), research possible load
requirements, and facility requirements to connect the area to NNG's pipeline
system.  Wichita is located about 90 miles from the Macksville compressor
station as a crow flies.
Outage Coordination
 Provided the study to determine flows on the San Juan lateral and mainline
when Bisti outage occurs in October.  Both San Juan and the mainline will
have reduced flows.  Study results were given to Market Services. Also
provided support for System Optimization to determine the flows west when
Station #3 unit 3 is out of service.

Marketing Strategy Meeting
Attended and participated in the Marketing Strategy meeting.  Main assignment
for Planning is to continue looking for revenue generating projects.

E&C
Participated in a review of the responding candidates for the vacant Project
Engineering position.

Omaha Facility Planning Team     (Team Leader: Steve Thomas 402-398-7468)

Earlville Outage
On October 12th starting at 8:00 am the Earlville unit will be taken down for
relocation of the blow down silencer.   Solar will also be on site to do some
bleed air manifold baffle modifications.  After this work is completed, the
District will perform a water wash in preparation for emissions testing on
October 16th & 17th.  The unit should be back on-line sometime near midnight
on October 12th.

With Earlville down for this time frame the flow on the East leg will be
limited to the 660-680 mmcf/d range.  We anticipate that normal nominations
will be below this threshold, and that by packing the system the night before
we will be able to make it through without any impact.   Gas Control is
putting this outage on the EBB.  From a Marketing perspective we should limit
short term sustainables, but Ops did not want to call an allocation day.  If
we did, the allocation would be 86% of firm in Zone D for all deliveries.

The emissions testing on October 16th & 17th will have very little impact on
system flows.

Planning White Paper
Planning met with various Marketing representatives to try and attach a value
to the four ideas put forth in the White Paper.   The ideas were thoroughly
discussed and the input we received will be incorporated into the Paper.
One suggestion was that we use the Pricing Desk to determine the value of the
additional capacity.  We will be meeting with them to do that.  Meanwhile
research continues on the various costs associated with the White Paper,
specifically sites for proposed inlet pressure additions.

Engineering Records Research
EOG - Texas Co. #4 (C.000269.01):
This is an interconnect where the Texas Co. #4 8" Lateral (OKG-19301)
connected to the 24" OKM-12001.  An incorrect line number on the project
authorization located the project six miles upstream of the actual site.
Engineering Records did not have the one page amendment with the project
authorization to explain who owns and operates the facilities.  Texas Co. #4
facilities had been removed.  The remaining pipe downstream of the compressor
site to OKM-12001 (approximately 4.5 miles) has been transferred to EOG
Resources as of June 16, 2000.  (Project Authorization C.000369.02/Removal).

Ogden H2S Monitor (SN0157):
Verification of materials used in the construction of the monitor was
needed.  Operations confirmed that a Farm Tap Assembly was used to create the
monitoring facilities, not to install a farm tap within the Ogden Plant yard.

Cedar Falls #2
Marketing needed to know if there was any money left in the work order to
purchase a new regulator, since the interruptible peaking turbine load is
causing problems with the existing regulator.  Property Accounting reported
the amount remaining, but it will not be enough for a new regulator.

St. Croix Valley
Provided options for the proposed ten year expansion for St. Croix Valley.
Examined cost versus incremental growth on the Black River Falls Branchline.
Provided an analysis for option of integrating the growth with the Wisconsin
Gas proposal.  Following the latest strategic marketing meeting, will examine
compression alternatives for St. Criox Valley as a stand-alone project.

Grimes #1 TBS - Pressure Increase
Working with Marketing and the Field.  Examined several options regarding the
customer,s request for a pressure increase to a delivery of 150 psig.
Marketing will examine all the options in order to determine best strategic
fit for the customer.

Ogden Building #2 Discharge Pressure
Research has been completed in trying to locate documentation that supports
the 1000 psig MAOP for the building #2 discharge header.  The supporting
documentation has been forwarded to Lisa Choquette in Codes for approval.  If
documentation is approved as supporting evidence for the 1000 psig MAOP then
only minor controls work will be required in the field in order to increase
the discharge pressure of the building #2 engines.

Pengilly TBS - Mesabi System
Marketing was presented with two separate estimates for modification required
to increase firm at Pengilly from 12 mcf/day to 210 mcf/day.   The first
estimate for $85,000 consisted mostly of contract labor with field personnel
only installing the EFM.  The team responded with a proposal that they would
be willing to do all of the labor if it could be scheduled during Jan-March.
A second estimate of $66,000 was submitted to Marketing, which included all
district labor.  This estimate is contingent on completing the deal prior to
Dec 31,2000.  If a deal is made after Dec 31, 2000 then the higher cost
estimate applies.

Monroe #1 TBS Mods / Pressure Increase
The Monroe #1 TBS Mods Project was released to Engineering.   The project was
the result of WIGas raising the IT load by approximately 4000 mcf/day.  They
also requested a pressure increase at the station from 80 psig to 275
psig.    A Form 2476 "Pressure Increase Request Form" is being circulated for
signature.  The project has a targeted Nov 30, 2000 in-service date.  The
modifications consist of replacing both meters with spool pieces and
performing a pressure test to upgrade the MAOP.

Milbank Project
Continued gathering data to model the Milbank system as it is today.

Melbourne #1 - Project Release
The Melbourne #1 TBS Mods project was released to Engineering.   The project
consists of TBS mods to support the increase of firm from 330 mcf/day to 500
mcf/day at Melbourne. Presently the Marshalltown B/L is constrained and could
not support the incremental firm.  Alliant will realign gas away from the
Marshalltown #1 TBS which is at the end of this B/L to the Marshalltown #1A
TBS which is on a different B/L.  This will open up capacity on the line for
this new load.   The project has a targeted Nov 30, 2000 in-service date.
Modifications consist of replacing the first and second cut regulators and
replacing the meter.

Adel #1A TBS Mods - project release
The Adel #1A TBS Mods Project was released to engineering.  This project was
a result of the customer wanting to convert an existing IT load at Adel #1A
to a Firm load.  The new Firm load will be 1400 mcf/day.   The project has a
targeted Nov 30, 2000 in-service date.  The station will have a new meter
installed along with piping size modifications.

Ethanol Injection
Reviewed and researched (for Marketing) the possibility of injecting Ethanol
into the pipeline for a possible "Green Energy" rating and as a means of BTU
enhancement.  Since ethanol would remain a liquid at any normal pipeline
conditions, even atomizing the ethanol at the point of injection would not
insure the Ethanol from liquefying, dropping out and collecting into the
pipeline low spots.  Also, there were many issues concerning possible liquids
entering the fuel systems of our equipment and other customers, equipment.
Planning recommended that this project not be pursued.

Researched (for Marketing) was the possibility of burning a Methane/Ethanol
mix in our equipment (i.e.: Turbines) in order to receive a "Green Power"
rating.  Solar was contacted concerning the possibility of "co-burning"
ethanol and methane.  As a manufacturer they said they would be willing to
work with us, however, they only recommended it if it were to be a constant
fuel source.  Solar said there would be considerable fuel injection system
retrofits required.  Also, if this were not a constant fuel then there would
have to be two separate fuel systems (co-burn and methane only) and a
complete fuel control system change.  With all that the project has been
deemed cost prohibitive.

Vapor Injection of Propane (VIP Service)
Research was started for Marketing into the possibility of injecting
vaporized propane into the pipeline as a way of increasing capacity during
peak days.  Upon initial review many questions were generated by the planning
team concerning specific requirements of the new service (i.e.: # of days/yr,
firm, daily firm etc.)  Planning awaits feedback from Marketing before any
more action is taken.

Electric Generation
Proposal was reviewed for Marketing from APA for an engineering study to
review the possibility of utilizing stand-by generators as electric producers
for the Utilities during peak power times in the summer months.  A few
discrepancies were found and are being worked out before APA can be released
to complete the engineering study.

Beaver Dehy
A request was received from John Sturn of the optimization team to review the
Capacity of the Mole sieve Dehy system at Beaver Compressor Station on the SE
24" line.  Beaver is considering a capital project to re-route the dehy
system that is currently piped into the suction of the station to the
discharge, thus increasing the capacity.

Cogentrix Power Plant
Three detailed cost estimates for the Cogentrix Power Plant proposals were
prepared and forwarded to Marketing.  The details of the cost estimate
included a breakdown of costs for:
Material Costs
Labor
Freight and Taxes
Surveys/Permits
Construction Support
District Labor
Engineering/Drafting/As-builts
Contingency
Overhead
AFUDC
The break down of costs was done for the Sheldon, Lehigh, and Raun projects
in Nebraska and Iowa.

Cherokee Ethanol Projects
Seven sites were examined for a proposed ethanol plant in Cherokee County,
Iowa.  The delivery volume was for 8 MMCF/D at a delivery pressure of 70
psig.  It was assumed for this study that the initial load would be for 4
MMCF/D for two years and then increase to the 8 MMCF/D level.  The cost
estimate assumed that the initial design would be for the 8 MMCF/D.  This was
done to reduce the cost for the project.  Each cost estimate was done for a
firm transport level and an interruptible transport level (14 cost estimates
total).  Two of the sites are on the C line approximately 10 miles southwest
of the Paullina Station.  The remaining sites were on the Storm Lake/Lytton
Branchline.


Looks good to me with the following suggestions:

2.2	Service Level Agreement.  EBS will use commercially reasonable efforts to provide the EBS Services in accordance with Appendix 2 to the Services Agreement; provided, however, Microsoft shall not be entitled to Liquidated Damages or other damages in the event of any SLA Failure.  Microsoft recognizes that the EBS Services has yet been through testing and that as a result the performance of the EBS will be negatively impacted.  EBS will use commercially reasonably efforts to test the system concurrently with delivering the EBS Services. NOTE:  (This may not be necessary as 1) there are no damages  2)  we are only held to a commercially reasonable standard anyway.

	2.3	Termination for Convenience.  Microsoft shall not be entitled to terminate the Services Agreement for convenience or for any other reason, except as expressly set forth in Sections 12.1.1, 12.1.2, and 12.1.4 of the Services Agreement.  Also 12.1.3  (EBS right to terminate)?

 -----Original Message-----
From: 	Edison, Andrew
Sent:	Friday, October 26, 2001 12:04 PM
To:	Fallon, Jim; Seeligson, Stewart; Racicot, Paul; Dimichele, Rich; Haedicke, Mark E.; Schuler, Lance (Legal); Hicks, Michelle; Koogler, David; Schrage, Adam; Plante, Everett
Subject:	MSN

As you know, news of the lawsuit has hit the Dow Jones wire.  I have also just received confirmation that formal service was accomplished in Austin about 45 minutes ago.


Just FYI - I believe you entered these deals on Jan. 16. What were you
thinking? How long have you worked here? Can you say, "wrong counterparty
name"? Also, why don't you have your own trader ID yet? Geez.

Sincerely,
Kate

P.S. Don't worry - I corrected them for you.
---------------------- Forwarded by Kate Symes/PDX/ECT on 01/18/2001 12:56 PM
---------------------------

Rhonda L Denton
01/18/2001 12:47 PM
To: Geir Solberg/PDX/ECT@ECT
cc: Kate Symes/PDX/ECT@ECT

Subject: Los Angeles Department of Water and Power

Please change deal nos. 497905 and 498198 to Los Angelese Department of Water
& Power.


Sara,

Here is the link to the Irish entity I just spoke to you about. The Lumber
Group is looking to get an ISDA in place with this entity but I wanted to get
your input on the legal side on an entity that is probably 100% owned by the
Irish Govt.

www.coillte.ie

Thanks for your help!

Regards,

Aparna Rajaram
ext. 5-4563


Got it

"Neil Mann" <nmann@erac.com> on 06/06/2001 08:08:14 AM
Please respond to <nmann@erac.com>
To: <Kay.Mann@enron.com>
cc:

Subject: RE: Save the Date -- Star Wars: The Magic of Myth

Please confirm receipt. I may be having e-mail problems...
I'm calling them and Red Oak this morning. I will have GR do the back yard
also. NM

-----Original Message-----
From: Kay.Mann@enron.com [mailto:Kay.Mann@enron.com]
Sent: Wednesday, June 06, 2001 7:26 AM
To: nmann@erac.com
Subject: Save the Date -- Star Wars: The Magic of Myth

Gold Rose today?
---------------------- Forwarded by Kay Mann/Corp/Enron on 06/06/2001 07:25
AM ---------------------------

From: Mark E Haedicke@ECT on 06/05/2001 01:46 PM

Sent by:  Janette Elbertson@ECT

To:   Alan Aronowitz/HOU/ECT@ECT, Michelle Blaine/ENRON@enronXgate, Sandi M
      Braband/HOU/ECT@ECT, Gail Brownfeld/Enron@EnronXGate, Robert
      Bruce/NA/Enron@Enron, Teresa G Bushman/HOU/ECT@ECT, Michelle
      Cash/HOU/ECT@ECT, Dominic Carolan/Enron@EnronXGate, Barton
      Clark/HOU/ECT@ECT, Harry M Collins/HOU/ECT@ECT, Mary
      Cook/HOU/ECT@ECT, Nancy Corbet/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt,
      Ned E Crady/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Eddy
      Daniels/NA/Enron@Enron, Angela Davis/NA/Enron@Enron, Peter del
      Vecchio/HOU/ECT@ECT, Stacy E Dickson/HOU/ECT@ECT, Andrew
      Edison/NA/Enron@Enron, Roseann Engeldorf/Enron@EnronXGate, Shawna
      Flynn/HOU/ECT@ECT, Robert H George/NA/Enron@Enron, Barbara N
      Gray/HOU/ECT@ECT, Mark Greenberg/NA/Enron@ENRON, Wayne
      Gresham/HOU/ECT@ECT, Leslie Hansen/HOU/ECT@ECT, Jeffrey T
      Hodge/HOU/ECT@ECT, Brent Hendry/NA/Enron@Enron, Dan J
      Hyvl/HOU/ECT@ECT, Anne C Koehler/HOU/ECT@ECT, Cheryl
      Lindeman/ENRON@enronXgate, Dan Lyons/HOU/ECT@ECT, Kay
      Mann/Corp/Enron@Enron, Travis McCullough/HOU/ECT@ECT, Lisa
      Mellencamp/HOU/ECT@ECT, Janet H Moore/HOU/ECT@ECT, Harlan
      Murphy/NA/Enron@Enron, Julia Murray/HOU/ECT@ECT, Cheryl
      Nelson/NA/Enron@Enron, Gerald Nemec/HOU/ECT@ECT, Marcus
      Nettelton/NA/Enron@ENRON, Francisco Pinto
      Leite/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, David Portz/HOU/ECT@ECT,
      Coralina Rivera/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Michael A
      Robison/HOU/ECT@ECT, Daniel R
      Rogers/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Elizabeth
      Sager/HOU/ECT@ECT, Richard B Sanders/HOU/ECT@ECT, Frank
      Sayre/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Lance
      Schuler-Legal/HOU/ECT@ECT, Sara Shackleton/HOU/ECT@ECT, Carlos
      Sole/NA/Enron@Enron, Carol St Clair/HOU/ECT@ECT, Lou
      Stoler/HOU/ECT@ECT, Mark Taylor/HOU/ECT@ECT, Sheila
      Tweed/HOU/ECT@ECT, Steve Van Hooser/HOU/ECT@ECT, John
      Viverito/Corp/Enron@Enron, Ann Elizabeth White/HOU/ECT@ECT, Randy
      Young/NA/Enron@Enron, Susan Bailey/HOU/ECT@ECT, Kimberlee A
      Bennick/HOU/ECT@ECT, Martha
      Braddy/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt, Sarah
      Bruck/ENRON_DEVELOPMENT@ENRON_DEVELOPMENt, Genia
      FitzGerald/HOU/ECT@ECT, Nony Flores/HOU/ECT@ECT, Diane
      Goode/NA/Enron@Enron, Linda R Guinn/HOU/ECT@ECT, Marie
      Heard/NA/Enron@Enron, Ed B Hearn III/HOU/ECT@ECT, Mary J
      Heinitz/HOU/ECT@ECT, Tana Jones/HOU/ECT@ECT, Kathleen
      Carnahan/Enron@EnronXGate, Deb Korkmas/HOU/ECT@ECT, Laurie
      Mayer/HOU/ECT@ECT, Matt Maxwell/Corp/Enron@ENRON, Mary
      Ogden/HOU/ECT@ECT, Stephanie Panus/NA/Enron@Enron, Debra
      Perlingiere/HOU/ECT@ECT, Robert Walker/HOU/ECT@ECT, Kay
      Young/HOU/ECT@ECT, Merrill W Haas/HOU/ECT@ECT, Samantha
      Ferguson/NA/Enron@Enron, Majed Nachawati/NA/Enron@Enron, Suzanne
      Adams/HOU/ECT@ECT, Connie
      Castillo/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Margaret
      Doucette/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Keegan
      Farrell/NA/Enron@Enron, Nita Garcia/NA/Enron@Enron, Carolyn
      George/Corp/Enron@ENRON, Esmeralda Gonzalez/ENRON@enronXgate, Vanessa
      Griffin/ENRON@enronXgate, Martha Keesler/ENRON@enronXgate, Holly
      Keiser/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, MaryHelen
      Martinez/NA/Enron@Enron, Taffy Milligan/HOU/ECT@ECT, Rae
      Meadows/ENRON@EnronXgate, Linda J Simmons/HOU/ECT@ECT, Becky
      Spencer/HOU/ECT@ECT, Twanda Sweet/HOU/ECT@ECT, Stephanie
      Truss/Enron@EnronXGate, Alice Wright/NA/Enron@Enron, Theresa
      Zucha/NA/Enron@Enron, Reginald Shanks/HOU/ECT@ECT, Claudia
      Meraz/HOU/ECT@ECT
cc:

Subject:  Save the Date -- Star Wars:  The Magic of Myth

(Embedded image moved to file: pic14413.pcx)                      (Embedded
image moved to file: pic16641.pcx)

               (Embedded image moved to file: pic19855.pcx)

                      The Museum of Fine Arts Houston

               (Embedded image moved to file: pic24855.pcx)


Steve --

On the people who participated in Reg Risk WG:

The key person who took the time to support us was Amr Ibrahim.  He was
fantastic.  He could do this himself if he didn't have other
responsibilities.  Needs alot of kudos for his help.  Also, Vinio Flores and
Alberto Levy.

Jim

	Steven J Kean
	Sent by: Maureen McVicker
	11/20/2000 10:12 AM

		 To: Jose Bestard/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Scott Bolton/Enron
Communications@Enron Communications, Hap Boyd/EWC/Enron@Enron, Jeff
Brown/NA/Enron@Enron, Ricardo Charvel/NA/Enron@Enron, Paul Dawson/Govt.
Affairs/LON/ECT@ECT, Joe Hillings/Corp/Enron@ENRON, Harry
Kingerski/NA/Enron@Enron, Nicholas O'Day/AP/Enron@Enron, Richard
Shapiro/NA/Enron@Enron, James D Steffes/NA/Enron@Enron
		 cc: Richard Shapiro/NA/Enron@Enron, Mark Schroeder/LON/ECT@ECT, Marcia A
Linton/NA/Enron@Enron, Ginger Dernehl/NA/Enron@Enron, Lora
Sullivan/Corp/Enron@ENRON, Rubena
Buerger/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Tracy Cooper/Enron
Communications@Enron Communications, Beverley Ashcroft/LON/ECT@ECT
		 Subject: WORKING GROUP PROGRESS

Please provide me an update on the progress of the working group you have led
this year.  There are several things I would like you to cover in this regard.

Did the working group function through the year or was it terminated (I
recognize there may be good reasons for the latter, but would like to
understand those reasons).

What did the group accomplish?

Would you recommend continuing it?   Any changes?

Are there other topics we should consider for working groups in the future?
Any changes to the working group process itself?

Please provide input on the individuals you worked with.  You should be able
to do this through the PEP system.  If you cannot, please provide the
feedback by confidential e-mail to me.  Because the PRC is coming up soon,
please provide the feedback by December 1.


THE HERNANDEZ'A NEW CRIB ADDRESS IS 506 CHITWOOD CT. HOUSTON TX 77094.  WHAT
IS UP!  DO YOU HAVE AN AOL INSTANT MESSENGER?  I'M AT EL64GALLO


------Original Message------
From: GAJANKE@up.com
To: gskradski@hotmail.com, wentapb@SprintMail.com,
von.hallauer@notes.airtouch.com
Sent: December 11, 2000 8:09:41 PM GMT
Subject: [No Subject]

Wuz de nite befo Crimmus;
>  And all ower da hood;
>  ereybody wuz' sleepin';
>  Dey wuz sleepin' good.
>
>  We hunged up our stockings;
>  An hoped like de' heck;
>  That old Santa Clause;
>  Be bringin' our check.
>
>  All o'de fambily;
>  Wuz layin in de beds;
>  While Ripple and Thunderbird;
>  Danced through dey heads.
>
> I passed out inna' flo;
>  Right nex to my Maw;
> When I heard sech a fuss;
>  I thunk: "It mus be de law!!!"
>
>  I looked out thru de bars;
>  What covered my doe;
>  'spectin' de sheriff;
>  Wif a warrent fo sho.
>
>  And what did I see;
>  said, "Lawd look at dat!!"
>  Ther' wuz a huge watermellon;
>  Pulled by giant warf rats!!
>
>  Now ober all de years;
>  Santa Clause, he be white;
>  But looks liken us bros;
>  Gets a black Sanna dis nite.
>
>  Faster dan a Po'lees car;
>  My home boy he came;
>  He whupped on dem warf rats;> > An' called dem by name!
>
>  On Leroy, on 'Lonzo ;
>  And on Willie Lee;
>  On Saphire, on Chenequa;
>  Dey wuz a site to see!!
>
>  As he landed dat watta' mellon;
>  Out der in da skreet;
>  I knowed it was fo' sho';
>  Da damndest site I ebber did see.
>
>  He didn't go down no chimbley;
>  He picked da' lock on my doe;
>  An' I sez to myself;
>  "Shit!! He done dis befoe!!!"
>
>  He had dis big bag;
>  Full of prezents I 'xpect;
>  Wid Air Jordans and fake gold;
>  To wear roun' my neck.
>
>  But he left no good prezents;
>  Jus started stealing my shit;
>  Got my drugs, got my guns,
>  Even got my burglar's kit!!
>
>  Wit my stuff in de bag;
>  Out da window he flewed;
>  I woudda' tried to catched him;
>  But he stoled my 'nife too!!
>
>  He jumped on dat wadda' mellon;
>  An' whipped out a switch;
>  He wuz gone in a seccon';
>  Dat son of a bitch!!
>
>  Next year I be hopin':
>  Anutha Sanna we git;
>  Cuz' diz here Sanna Clause;
>  Jus' ain't werf a shit!!!


Have a good vacation.

 I talked to Rahil and he is going to focus a significant amount of his time
with your team, from an origination perspective, on what you and I discussed
yesterday.  We are also dedicating an analyst full time, that works for Marc
Eichman in structuring, to work with Rahil and your team on getting the
business plan and modeling completed for commercialization.

I am seeing Tom Gros today at 3 PM to discuss with him what I discussed with
you yesterday.

Can we meet again this Thursday with you, your commercialization team and
Rahil, Marc and the analyst to agree on what we want to accomplish in the
next week or so?

Let me know your thoughts.

GP

 -----Original Message-----
From:  Beck, Sally
Sent: Tuesday, February 27, 2001 11:18 AM
To: Piper, Greg; Philippe A Bibi/HOU/ECT@ENRON; Causey, Richard
Cc: Spiller, Tina; Peggy McCurley/HOU/ECT@ENRON; Westbrook, Sharron;
Thompson, Patti
Subject: Out of the Office - March 2 and March 5

I will be out of the office on vacation on Friday, March 2 and Monday, March
5.  I will check messages at the end of both business days.  My assistant,
Patti Thompson ( x35926) will have contact numbers for me.  Since I will be a
chaperone for my daughter and 80 other girls from the high school drill team
at state competition in Dallas, it is unlikely that I will be easily
reachable during the day.

I will be back in the office on Tuesday, March 6.