Defending Free Markets
The New York Times, 08/22/01
OBSERVER - The right stuff - AVENUE OF THE AMERICAS.
Financial Times, 08/22/01
Power station blast still a puzzle
The Northern Echo, 08/22/01
Panel unable to find meeting point with Enron
The Times of India, 08/22/01
INDIA: ANALYSIS-Poor governance hobbles India's reform drive.
Reuters English News Service, 08/22/01
Calif Senate Panel To Study Muni Utils Pwr Mkt Activities
Dow Jones Energy Service, 08/21/01
Fired Calif DWR Traders Had Access To ISO's Control Room
Dow Jones Energy Service, 08/21/01

Editorial Desk; Section A
Letters to the Editor
Defending Free Markets

08/22/2001
The New York Times
Page 18, Column 5
c. 2001 New York Times Company

To the Editor:
Paul Krugman misunderstands Enron, the people who work here and the botched California regulatory system (column, Aug. 17). The broader goal of his latest attack on Enron appears to be to discredit the free-market system, a system that entrusts people to make choices and enjoy the fruits of their labor, skill, intellect and heart. He would apparently rely on a system of monopolies controlled or sponsored by government to make choices for people. We disagree, finding ourselves less trusting of the integrity and good faith of such institutions and their leaders.
The example Mr. Krugman cites of ''financialization'' run amok (the electricity market in California) is the product of exactly his kind of system, with active government intervention at every step. Indeed, the only winners in the California fiasco were the government-owned utilities of Los Angeles, the Pacific Northwest and British Columbia. The disaster that squandered the wealth of California was born of regulation by the few, not by markets of the many.
KEN LAY
Chairman and Chief Executive
Enron Corporation
Houston, Aug. 20, 2001

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

OBSERVER - The right stuff - AVENUE OF THE AMERICAS.

08/22/2001
Financial Times
(c) 2001 Financial Times Limited . All Rights Reserved

This year's honour roll of former chief executives is impressive and lengthening. Flemming Lindelov of Carlsberg Breweries left for a decorative arts company, while Jeff Skilling resigned from Enron last week for "personal reasons" and the amiable Michael Bonsignore bade farewell to Honeywell.
While some bosses have been shown the door, there appears to be a separate pattern forming - chief executives leaving prematurely because life at the top is too tough and stressful, raising the question as to whether the modern CEO has the right stuff.
And there is the pressing issue of how activist a board should be in these "transition" issues. Take, for example, Hewlett-Packard directors, several of whom this week swore their allegiance to Carly Fiorina, the chief executive whose fate has been the subject of much speculation.
In venture-capital-backed companies directors have traditionally been active in recruiting and overseeing financial management, taking credit for success and, sometimes, distancing themselves from blame. But in public companies, which have fuller management teams, directors have tended to take a back seat.
According to Roger Kenny, managing partner of Boardroom Consultant, a New York firm that recruits directors and senior management, boards have become more responsive to their company's performance - and are willing to act.
"Institutional investors have been successfully criticising boards for a long time. They have put some fibre in the backbone of the directors," said Kenny.
Directors are now faced with preventing or mitigating CEO disasters. "In the past, boards may have felt beholden to the CEO and been willing to overlook mistakes, giving him time to right the ship. Today, a sense of urgency often pervades board meetings when performance slips," he added.
Take the case of Lucent. "If Lucent's board had removed its CEO earlier in the game, would the company be in better shape today?" asks Kenny. Or Xerox. "Should Xerox's board have demanded more information about strategic execution from the new CEO before the strategy foundered?"
There are no sure answers but the short period that many CEOs remain in the job - on average four years - suggests it is tough to satisfy shareholders and directors, particularly during a downturn.
"One of the great revelations of the past year has been the capacity of a CEO to destroy value in a very short period of time," said David Nadler, chairman of Mercer Delta Consultants.
Boards need to act pre-emptively to reduce the risk of a meltdown. The trick lies in the timing. Some say boards should give CEOs more time because the economy can be blamed for failure. Others argue they should give the CEO less time because the economy makes the situation perilous and there is no time to lose.
"Boards struggle to balance acting swiftly (to prevent Lucent-like situations) and not jumping the gun," said Kenny. "It's a fine line, especially during economic downturns such as the current one."
Kenny says there are a number of steps a board can take to prevent CEO failure, including becoming involved in CEO succession and doing "whatever it takes" to become familiar with the company's core business strategy.
And tradition is important. The Hewlett-Packard directors insisted that Fiorina was faithful to the founders' dream - until then, there had been outside speculation that, for Fiorina, it would be the HP way or the highway.
(c) Copyright Financial Times Ltd. All rights reserved.
http://www.ft.com.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

Power station blast still a puzzle
Chris Brayshay

08/22/2001
The Northern Echo
13
Copyright (C) 2001 The Northern Echo; Source: World Reporter (TM)

SAFETY inspectors investigating a power station explosion which killed three workers have so far found no evidence of mechanical failure.
Andy Sherwood, 36, and Darren Higgins, 28, caught the full brunt of the blast in a transformer at Enron's Teesside Power Station at Grangetown, Middlesbrough, on August 8 and could only be identified from dental records.
Colleague Lawrence Surtees, 40, died in hospital the next day after suffering near 100 per cent burns. Graeme White, 37, is being treated in hospital for moderate burns.
The dead men were carrying out maintenance on the transformer at the time of the explosion.
Vera Baird, MP for Redcar, has discussed the situation with Ian Waugh, the Health and Safety Executive (HSE) inspector in charge of the team investigation. She said: "I said when this appalling tragedy occurred that I would monitor the investigation on behalf of my constituents and I have been told that the investigation has established that the cause was the explosion of a transformer.
"I am assured that there is no fundamental hardware problem with the equipment used on the site that would be likely to cause a repetition and this will be reassuring for the people who live and work nearby."
Less that a week after the funeral services of the men who died, the MP has revealed that all interviews and investigations of equipment are complete and Mr Waugh is waiting for his inspectors to write their reports, which ought to take about four weeks.
Mr Waugh will then review their findings and his final report will be sent to the Teesside Coroner.
A copy of the report will also be sent to Cleveland Police who set up a joint investigation with the safety inspectors.
Mrs Baird's reading of the team's findings so far went unchallenged by Government sources last night, who added that the team reserved the right to return to the plant for a re-examination if something cropped up in the reports which required further investigation.
A spokesman for Enron said: "Assurances about the safety of Teesside Power Station have been given by the site operator - Enron - to local residents and industrial neighbours over the past few days as the process of restarting the plant was carried out.
"The company is not be commenting on any possible cause of the incident on August 8 and will not be drawn in at this stage as the investigation by the HSE remains incomplete."

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

Panel unable to find meeting point with Enron
Seema Kamdar

08/22/2001
The Times of India
Copyright (C) 2001 The Times of India; Source: World Reporter (TM)

MUMBAI: The Enron renegotiation committee, which is expected to submit its report soon, has been unable to find a meeting point with the multinational over any of the issues discussed during its meetings.
According to sources, the meetings with Enron were doomed right from the word go, since Enron disagreed with most of the suggestions made by the committee. This could have to do with the energy major having already decided to exit the plant and not wanting to make any further compromises.
To begin with, the committee wanted to scale down the tariff from over Rs 4 per unit to Rs 2.07 per unit. This was not acceptable to Enron, which was willing to settle for not more than a 10 per cent reduction in tariff.
Enron representatives told the panel that its landed cost of LNG alone worked out to Rs 2.11 per unit in power tariff. Even the offer made by states outsides Maharashtra to buy Enron power could not meet with a consensus, sources said.
Among the states which approached the panel to buy Enron power were Delhi, MP, UP, Rajasthan, Punjab, and Karnataka. However, Enron found the purchase rates which ranged from Rs 1.50 to Rs 2.50 impractical.
The committees demand to remove the dollar denomination in tariff was rejected outright by Enron on the grounds that its international lenders would never agree to accept returns in Indian currency. A debt moratorium for five years, as suggested, was also ruled out.
Enron was asked to bring down interest rates on its debt component to less than 12 per cent. This was ruled out by the multi-national which claimed it was less than the cost of its borrowings. While the projects Indian lenders agreed last year to cut interest rates from 21.5 per cent to 16 per cent, its international lenders charge nine per cent in dollar terms.
Enrons return on equity too has hovered around a low of 12 per cent, since the past two years, lower than the interest on its debt.
With a view to reducing the liability of the cash-strapped Maharashtra State Electricity Board (MSEB), the renegotiating committee suggested that the Dabhol plant be operated at a lower plant load factor (PLF) of 30 per cent. The PLF is a major bone of contention between the two parties, since the state says it does not need power at a 90 per cent PLF and since tariff is predicated on a PLF of 90 per cent in the power purchase agreement, irrespective of the actual offtake.
It is learnt that Enron was asked to operate the plant at 30 per cent PLF from 2002 and scale up to 68.5 per cent in 2007 to offset the huge tariff burden on MSEB. This proposal was unpalatable to Enron.
Another proposal which was turned down by Enron was the suggestion that the returns on its equity be trimmed to 16 per cent in rupee terms at 68.5 per cent PLF. As of now, the DPC gets 16 per cent returns at 68.5 per cent PLF in dollars with a 0.7 per cent incentive for every one per cent increase in the PLF.
According to sources, the committee discussed abolishing the incentive component, bringing down PLF, and pegging return in Indian currency. With the multi-national mouthing a firm No to most of the proposals, it remains to be seen how the Godbole report will be implemented and whether the state will see yet another round of protracted litigation on the controversial project.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

INDIA: ANALYSIS-Poor governance hobbles India's reform drive.
By Alan Wheatley, Asian Economics Correspondent

08/22/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW DELHI, Aug 22 (Reuters) - After six months of political stalemate, the rave reviews for Finance Minister Yashwant Sinha's reforming budget have given way to the despairing conclusion that perhaps India embraces change only in a crisis.
In which case, a new wave of reforms might not be far away.
For unless growth picks up substantially from last year's 5.2 percent pace, policy experts said India would face a further deterioration in its public finances and rising unemployment that could put the world's largest democracy under serious strain.
"We can't go on without further reforms for very long because we won't be able to grow even by five percent," said Shashanka Bhide, chief economist of the National Council of Applied Economic Research.
"So the crisis is already there. If we're not going to get six percent-plus growth rates, then it's a political problem."
There is a broad consensus - on paper - on the need for a second wave of reforms to build on ground-breaking liberalisation measures rushed in after a balance-of-payments crisis in 1991.
Because its economy is fairly closed, India has weathered the current global downturn much better than most of its Asian neighbours, who would be delighted with five percent growth.
Still, output has slowed for two years in a row as post-reform momentum has petered out. And crucially, five percent growth falls far short of the 8.7 percent average needed over the next decade to achieve Prime Minister Atal Behari Vajpayee's goal of doubling per capita income, currently around $460 a year.
"Eight million people come into the workforce every year and a five percent growth rate would leave large numbers of people unemployed, which means there will be greater social unrest," said P Chidambaram, a former finance minister.
"A five percent growth rate, while statistically acceptable, is simply politically unacceptable and socially unacceptable."
COMPETITIVE POLITICS
It was to raise the economy's speed limit that Sinha unveiled in his February budget a raft of far-reaching structural reforms making it easier to fire workers and rolling back the policy of reserving certain industries for small and medium-sized firms.
The reforms are high on the list of the many blueprints for change in India but they soon became mired in what the Planning Commission aptly calls the "compulsion of competitive politics".
On a charitable view, the slow progress is a reflection of the wondrous kaleidoscope that is India's multi-party democracy.
"This is not a country, this is a vast continent in search of a synthesis in the political domain, the social domain and the economic domain," said Amit Mitra, secretary general of the Federation of Indian Chambers of Commerce and Industry.
Less charitably, the legislative paralysis is due to the failure by an enfeebled Vajpayee to crack heads in his unwieldy 19-party coalition and force ministers to put the national interest before the myriad vested interests opposed to change.
Arjun Sengupta, a professor at the Centre for Policy Research, said the absence of a unified agenda meant each member of the coalition was ploughing its own furrow, resulting in policy inconsistency that was deterring badly needed investment.
"This is the main problem we have today: we do not have a coherent, unified policy framework," Sengupta said.
He said the reform task facing the government was all the more difficult because India's most populous and backward states were falling farther and farther behind the better-off ones.
"If the Centre cannot take care of the problems of disparity between the states, we are facing major problems which can become explosive," Sengupta, a former ambassador and IMF official, said.
Peering through the gloom, optimists point to the precedent of legislation passed without the pressure of a crisis in 1999 to open up India's insurance market to foreign firms.
They hope two equally controversial reform bills, to liberalise the crisis-ridden power sector and to make it easier to wind up bankrupt firms, will also eventually become law after they won cabinet approval last week, ending months of wrangling.
"Anybody who says reforms have been a failure in this country hasn't looked at figures on poverty very closely," said Planning Commission member N.K. Singh. He said the poverty rate had fallen in the past decade to 27 percent from 37 percent.
REFORM PRIORITIES
The list of reforms needed to sustain this improvement is lengthy. Because of its pivotal role in the economy, the power sector is many experts' number one priority. The well-catalogued troubles that foreign firms such as Enron Corp have encountered dealing with India's all-but-bankrupt state power boards have flashed warning signals to potential foreign investors.
Domestic investors have also been deterred because industrial users pay twice as much as they would in China for electricity.
Nevertheless, attempts at serious reform have foundered on twin political rocks: how to end overmanning at the power boards, estimated at 50-70 percent, and how to charge users, mainly farmers, market rates for stolen or heavily subsidised power.
D.K. Srivastava, a professor at the National Institute of Public Finance and Policy, said politicians might consider tough measures if they could be assured that benefits would be visible before they have to seek re-election two or three years later.
"Any government under any minister will say to you, How can I survive unless I can show my voters jobs?'," Srivastava said. "This is one of the basic constraints on power sector reform."
T.K. Bhaumik, a senior adviser at the Confederation of Indian Industry, agreed and said reformers were partly to blame for having failed to sell the case for change to India's mass poor.
"We did not articulate the economic reform process to the people," Bhaumik said. On privatisation, for instance, policy-makers did not spell out the consequences for jobs.
"I don't think we really understood the issues properly. We simply followed the Washington consensus and that didn't go down well with the people," he said.
As Divestment Minister Arun Shourie knows only too well. The privatisation programme he oversees, a litmus test of India's reform will, is stalled because of what Shourie calls "fractured" politics and "noise" generated by corporate interests.
Shourie said he could only hope that fading growth would jolt India's politicians into putting the country's interests first.
"We're on the cusp at the moment on the question of reforms and I feel the real circumstances in which India is placed will force the political class to do the right thing," he said.

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

Calif Senate Panel To Study Muni Utils Pwr Mkt Activities

08/21/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

LOS ANGELES -(Dow Jones)- A California Senate committee investigating electricity market manipulation in the state will continue its activities past the legislature's Sept. 14 adjournment date, and will look into prices charged by municipal utilities as well as by private generators, said committee Chairman Joe Dunn, D-Santa Ana, Tuesday.
"We had to prioritize who we would investigate first. We started with generators, then expanded to traders and we're also going to look at the state's utilities. We've already made document requests of the Los Angeles Department of Water and Power and the Sacramento Municipal Utility District," Dunn said.
Dunn said the LADWP hasn't provided all documents to the committee, though they have indicated they are happy to cooperate.
"It's taken LADWP a while. It doesn't seem to be the case that they are withholding those documents, though we don't have them all," Dunn said.
No one at LADWP was available to comment on the matter.
The Senate Select Committee to Investigate Market Manipulation has cited Enron Corp. (ENE) and Reliant Energy (REI) with contempt for refusing to provide certain documents. If the full Senate approves those contempt charges, the companies could be punished, most likely with fines.
A study by trade group Independent Energy Producers Association found that Reliant and Enron Power Marketing Inc. charged the state's power-buying arm less than the average price of $269 a megawatt-hour for electricity in January through March. The LADWP and SMUD charged more than the average.
The committee's next hearing will be in the first week of September, Dunn said. Hearings throughout the fall will concentrate on depositions, he added.
-By Jessica Berthold, Dow Jones Newswires; 323-658-3872; jessica.berthold@dowjones.com -0- 22/08/01 01-17G

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.

Fired Calif DWR Traders Had Access To ISO's Control Room
By Bryan Lee

08/21/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

OF DOW JONES NEWSWIRES

WASHINGTON -(Dow Jones)- Four of the five California Department of Water Resources power traders fired last month for conflict of interest reasons had access to the state electricity grid operator's control room.
That revelation was contained in a recent letter to the House Government Reform Committee from Terry Winter, the California Independent System Operator's president and chief executive.
The letter responded to House lawmakers' concerns, voiced during an Aug. 2 hearing, about DWR power traders having access to the ISO's control room floor and the wealth of market-sensitive information available there.
Rep. Doug Ose, R-Calif., who chairs the committee's energy policy panel, said access to the ISO's control room allowed DWR traders to "cherrypick" power purchases, and led federal regulators to exclude DWR purchases from consideration in a recent landmark refund order.
The five fired DWR traders owned stock in Calpine Corp. (CPN), a major power provider in California.
The four fired DWR employees with access to the ISO control room were William Mead, Herman Leung, Constantine Louie and Peggy Chung. The fifth, Richard Ferreiro, wasn't among those Winter listed as having control-room access. Neither did Elaine Griffin, who resigned after it was learned she owned Calpine stock.
They were among 14 DWR employees who had their control-room access privileges terminated by the ISO over the past two months. The others had their badges deactivated because they either hadn't filed necessary confidentiality statements or hadn't been using their badges to access the ISO control room, said Stephanie McCorkle, an ISO spokeswoman.
Nine DWR power traders still enjoy access to the ISO control room, according to Winter's letter to Ose. Among them is Bernard Barretto, who reportedly owns stock in Enron Corp. (ENE).
Steve Maviglio, a spokesman for California Gov. Gray Davis who recently sold Calpine stock after conflict-of-interest concerns were raised, said earlier this month that Barretto's investment met state ethics rules because Enron wasn't making sales in the spot market, where the DWR employee was involved in making power purchases.
DWR employees' investments are "thoroughly reviewed" to make sure there are no conflicts, DWR spokesman Oscar Hidalgo said. Employees must either divest their stock or recuse themselves from deals that involve their financial interests, Hidalgo said.
An Ose spokesman, Yier Shi, said the congressman believes the arrangement has worked against the interests of California consumers.
"It's pretty obvious that it isn't in the interest of California consumers, the DWR or the ISO to have that conflict of interest in the power-purchasing process," Shi said.
"Why is DWR getting preferential access? That's the core issue," Shi added.
Allowing DWR power traders into the ISO control room is "a real conflict because DWR is the major buyer in the state," said Lynne Church, president of the Electric Power Supply Association, whose members include many of the companies that own power plants in California.
"Having access to the control room gives them intelligence on what sellers into shorter-term markets are charging, (including) what's being sold and to whom," Church said.
"Any kind of buyer or seller would give their eye teeth for that kind of access," she said, noting that no other grid operator in the country allows that sort of access. "It's just unconscionable for them to have that kind of access to market intelligence."
During the Aug. 2 hearing that Ose chaired, Winter agreed that having DWR employees in the control room was a problem. The ISO is "working very hard to get them out," he said.
The access was provided back in January, after the DWR was forced to begin purchasing what since then has amounted to about $10 billion in power on behalf of the state's bankrupt and near-bankrupt investor-owned utilities, Pacific Gas & Electric Co. (PCG) and Southern California Edison Co. (EIX).
Power providers were balking at continuing to sell power to California unless they were assured of creditworthy buyers. And the DWR refused to take on the responsibility unless the ISO granted the agency access to the control room, Winter told Ose's subcommittee.
The arrangement was necessary to avert imminent blackouts, he said.
The DWR will withdraw its employees from the ISO control room effective Sept. 1, Pete Garris, who oversees power purchases for the DWR, announced over the weekend.
"It wasn't our intent to be there on a permanent basis," said Hidalgo, the DWR spokesman, who described the privilege as "a temporary move to keep the lights on."
Now that the state's electricity crisis has lessened, the DWR's "goal" is to have the traders out of the ISO control room by Sept. 1, Hidalgo said.
"We're pleased to see that the DWR is working toward resolving its conflict of interest problems with the ISO," said Shi, the Ose aide. "We hope this change of policy isn't too little too late for California consumers to win refunds."

-By Bryan Lee, Dow Jones Newswires; 202-862-6647; Bryan.Lee@dowjones.com

Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved.


Hi Cheryl,

I've been asked to see what I can find out about the status of the generator
for the Westinghouse 501D.  I've heard stories ranging from it was on the
Titantic, to it was in a rain storm.  Can you shed any light on its status?

Thanks,

Kay


When: Wednesday, December 05, 2001 9:30 AM-11:00 AM (GMT-06:00) Central Time (US & Canada).
Where: EB42C1

*~*~*~*~*~*~*~*~*~*

A meeting regarding handling questions relatated to furloughed foreign national employees (H-1 & L-1 visa holders) ImmigrationQ&A has been set up for tomorrow at 9:30 in conference room EB42C1


Be advised,  I am sending a draft today to LP (R.Dieringer) today for their
review.

Debra Perlingiere
Enron North America Corp.
Legal Department
1400 Smith Street, EB 3885
Houston, Texas 77002
dperlin@enron.com
Phone 713-853-7658
Fax  713-646-3490


Correction to the notice sent February 28, 2001

> Attached is information regarding the ISO request for submission of cost
> data for all sales over the $250 soft cap in effect from December 8-31,
> 2000 and the $150 soft cap in effect since Janaury 1, 2000.  The request
> is issued under Section of 4.5.1 of the ISO's Market Monitoring and
> Information Protocoal (MMIP).
>
> If you have any questions, please contact your Client Services
> Representative or Greg Cook at (916) 608-7202 or gcook@caiso.com.
>
>
>
>
>  <<DMA_Letter_Feb27.doc>>  <<DMA Cost Reporting Guidelines.doc>>
>
> Eric Hildebrandt
> Manager of Market Monitoring
> California Independent System Operator
> (916) 608-7123
>

 - DMA_Letter_Feb27.doc
 - DMA Cost Reporting Guidelines.doc


huh?

	From:  Jennifer Fraser                           01/24/2001 01:57 PM

To: John Arnold/HOU/ECT@ECT
cc:
Subject:

have you considered GD vs HO daily (HH vs NYHO)


Hi Doug,

I hear you are working on the Midway deal.  Me, too.   I want to go back to
the restaurant  you suggested with the remarkable decor and wine list (was it
Burns, something like that?).

 I look forward to working with you on this one.

Kay


11 AM EST works for me.

 -----Original Message-----
From:  MedleyB@gtlaw.com@ENRON
[mailto:IMCEANOTES-MedleyB+40gtlaw+2Ecom+40ENRON@ENRON.com]
Sent: Friday, June 01, 2001 10:42 AM
To: Jacoby, Ben; Krimsky, Steven; Mann, Kay
Subject: RE: Conference call on Monday morning

How does sometime between 9:30 and 11:00 a.m. EST sound for you all?

>  -----Original Message-----
> From:  Medley, Becky (Secy-FTL-Env)
> Sent: Friday, June 01, 2001 10:59 AM
> To: 'ben.jacoby@enron.com'; 'Steven.Krimsky@enron.com';
> 'kay.mann@enron.com'
> Subject: Conference call on Monday morning
>
> Please let me know your availability ASAP for a conference call with
> Debbie to discuss the Pompano and Deerfield agreements; we need to submit
> something to the City Attorney in Deerfield Beach on Monday afternoon.
>
> Rebecca C. Medley
> (954) 768-8230
> Assistant to Debbie M. Orshefsky
> and Frank Schnidman
>
>
>
_______________________________________________________________
The information contained in this transmission may contain
privileged and confidential information.  It is intended only
for the use of the person(s) named above. If you are not the
intended recipient,  you are hereby notified that any review,
dissemination, distribution or duplication of this
communication is strictly prohibited. If you are not the
intended recipient, please contact the sender by reply email
and destroy all copies of the original message.

To reply to our email administrator directly, please send an
email to postmaster@gtlaw.com.


Dear Tony,

Please be advised that all cargo tanks have been cooled down and all
cargo pumps and spray pumps have been run and worked satisfactory.
Have just arrived Bahrain, March 14th 1815lt, and expecting to stay
here abt 4 days.  Reverting.

Best regards

Capt Kjell Kvammen


---------------------- Forwarded by Darron C Giron/HOU/ECT on 05/01/2001
02:14 PM ---------------------------

Bruce Mills@ENRON
05/01/2001 11:45 AM
To: Brad Morse/HOU/ECT@ECT, Phillip M Love/HOU/ECT@ECT, Victor
Guggenheim/HOU/ECT@ECT, Patrick Ryder/NA/Enron@Enron, Ryan
O'Rourke/ENRON@enronXgate, Kristine Best/ENRON@enronXgate
cc: Derek Bailey/Corp/Enron@ENRON, Diane Anderson/NA/Enron@Enron, Kori
Loibl/HOU/ECT@ECT, Sladana-Anna Kulic/ENRON@enronXgate, Carole
Frank/NA/Enron@ENRON, Darron C Giron/HOU/ECT@ECT
Subject: what is your place in the kingdom?

A different kind of personality test...

http://www.cmi-lmi.com/enterppp.html


As I believe I've mentioned to both of you, ENA has entered into an
Electronic Trading Agreement that clearly provides that physical gas and
financial transactions will be governed by specified Master Agreements in
lieu of the online GTCs.  I wanted to let you know what those underlying
contracts are so that you can confirm that you are comfortable trading on
DynegyDirect pursuant to their terms.

Master Firm Purchase/Sale Agreement, dated July 1, 1993 governs natural gas
transactions

Master Agreement, dated January 27, 1992 governs financial transactions.

Leslie


- CALPINE MONTHLY GAS NOMINATION___.doc


Russell:

I received your voice mail about the one (1) year financial trade done
between ENA and CP.  The three-month limitation on trades is only an internal
ENA control which was imposed by credit some years ago.  Please refer to
Lotus Notes for a more comprehensive explanation.

The Master Agreement has been executed.  However, CP was unable to render a
legal opinion vouching for "blanket" enforceability of the trades due to
conflicting PUC orders which are still in effect today.

What is credit's position when your internal policy is violated?  Who was the
trader?  Have you spoken with the trader?

Sara Shackleton
Enron North America Corp.
1400 Smith Street, EB 3801a
Houston, Texas  77002
713-853-5620 (phone)
713-646-3490 (fax)
sara.shackleton@enron.com


I'm heading to KC tomorrow for a meeting with Langley and Tino on some goofy
project.  Funny thing is, now that he is sitting on $100 mm, I take
everything he says pretty damn seriously!   If word gets out, expect another
huge dive in ENE price.  DF

dhill@wrf.com on 01/24/2000 05:32:34 PM
To: Drew Fossum/ET&S/Enron@ENRON
cc:

Subject: Re: ENE

Not a good day for the market in general.... Good thing I pay so little
attention to it (not).  By the way, I sent my application back to KU last
week.  I was going to send you a copy of what I mailed in, but who knows
whether I'll ever get that done.  Don't be surprised if they give you a
call....  drh

                    Drew_Fossum@e
                    nron.com             To:     DHill@wrf.com
                                         cc:
                    01/24/00             Subject:     Re: ENE
                    04:59 PM

See ENE today?  Glad I didn't quit my day job.  DF
---------------------- Forwarded by Drew Fossum/ET&S/Enron on 01/24/2000
03:59 PM ---------------------------

 (Embedded
 image moved
 to file:      From:  Drew Fossum
 pic25955.pcx) 01/21/2000 03:31 PM

To:   dhill@wrf.com
cc:

Subject:  Re: ENE  (Document link: Drew Fossum)

I wish.  As to your complaint about my failure to tip you off, there were
two primary reasons:  (1) if I told you and got caught I'd go to prison,
and, more importantly, (2) I had no clue. DF  (its better to be lucky than
good!)

dhill@wrf.com on 01/21/2000 02:58:19 PM

To:   Drew Fossum/ET&S/Enron@ENRON
cc:

Subject:  Re: ENE

Yeah, I've noticed it.  Particularly the run-up yesterday.  Hell no, I
don't own any ENE.  Why didn't you tell me this was going to happen?
Between ENE and our good old EMC, you really are closing in on
retirement.....

                    Drew_Fossum@e
                    nron.com             To:     DHill@wrf.com
                                         cc:
                    01/21/00             Subject:     ENE
                    02:41 PM

Check out ENE over the last 30 days.  I'm a few more weeks away from
retirement.  Do you own any?  DF

(See attached file: pic25955.pcx)

 - pic25955.pcx


what type of flexiblity would we hav on teh Terrell plant gas?  Can we switch
it daily or do we have to committ to either El Paso or  PGE at the start of
the month?


Gentlemen,

I have made changes to the consolidation agreement, which I hope all will
find acceptable:

(It does need a date or two.)

As for the termination agreement, here's what I suggest:

Do we want to address the purchaser's parent guaranty in both of the
contracts, or just the consolidation agreement?  I would suggest that we make
the guaranty a deliverable 30 days after execution of the contracts, which
gives us time to get the Mitsui assignment done, as we expect to assign the
contracts immediately.  That way, Mitsui can provide the guaranty, if
necessary.  If ENA does provide the guaranty, we would want to have the
ability to have it replaced with a suitable substitute guaranty from Mitsui.

Sorry I missed your call.  It was a day of meetings.  I will be on the road
tomorrow, but will check my voice mail.

Kay


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Prepared in contemplation of litigation -  Attorney Client Privilege

There appears to be no succinct way to write down my thoughts on where we are
with El Paso but I'm going to try.

Assumption:
Kilgore's objective:  Maintain PRM accounting treatment for the swap.
Outcome of lawsuit:   Game Over for Kilgore if his accountants disagree with
the current PRM treatment and move it to debt thus affecting his      ratios
and revolver.

What do we want?
(i)  To be certain of payment - how important is this really?  Pretty
important - but what is this worth is cash terms.  We clearly are in a
position   whereby if El Paso evers transfers the contract to an entity which
defaults on payment we are exposed.  However,  realistically what are the
chances  of them defaulting - very low and, would we win that in court - Yes.
(ii)  To monetize the contract - secondary concern with a value to Enron of
$15m.  There are potential ways that we could monetize the contracts
without disclosing the contract - Joe is working on these.    If there is a
way we can do this then our downside from this confidentiality issue is
much   smaller as it would cost us more to monetize (thereby bringing in less
gain - probably not much of a difference) but can we get the asset off the
book?  We are pursuing how far we can get  in terms of 'true sale' treatment
with V&E - they will give Joe a view on Wednesday.  There are potential
other   ways we can ensure this is off our credit.

If we sue them?  Loss of leverage.
We potentially open up the issue to a much wider audience and potentially
affect Kilgore's accounting treatment - the one thing he wants.  So our
leverage has disappeared as we are no longer able to maintain the one thing
Kilgore is looking for.

Way Forward:
We should continue to pursue a commercial solution to the payment issue and
monetize the contract through a secondary route.  If we complete monetization
through another route then we are exposed to non-payment which could be
perceived as very low risk (we have potentially a one year exposure on the
back end based on six years statute of limitations).  If we cannot get a way
forward on the monetization , then re-review the way forward. We are at risk
of them suing us over the confidentiality breach and that would be in New
York.

Good Luck!

Prepared in contemplation of litigation -  Attorney Client Privilege


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-----Original Message-----
From: 	Kearney, Julie
Sent:	Monday, October 15, 2001 10:57 AM
To:	Joyner, Tamera
Cc:	Cash, Michelle; Sweet, Twanda; Jones, Robert W.- HR Exec
Subject:	Laird Dyer Contract

Michelle,

I rec'vd the FAXed DRAFT document for Laird Dyer.  The contract is fine.  Please execute the agreement and send to Robert to sign.

NOTE:  There is not a signed copy of the Confidentiality and Intellectual Property Rights Agreement in Laird's file.  He is signing the Agreement w/ today's date (10/15/01).

Thanks!  Julie K

Julie Kearney
EWS Human Resources
503) 464-7404
julie_kearney@enron.com


The reason I thought we used Andy was because he was from Corp and so is Cindy.  (I was not aware of some closer tie Andy had to the sales marketing division function.)   We probably could use his replacement--do you know who that is?   Thanks, Maria

 -----Original Message-----
From: 	Miller, Mary Kay
Sent:	Tuesday, November 06, 2001 10:02 AM
To:	Rapp, Bill; Hartsoe, Joe; Pavlou, Maria
Subject:	RE: Northern Natural Gas - Marketing Affiliate Compliance

Why wouldn't we just use Andy's replacement?  Cindy is communciation and HR, not much fit there at all-  MK

 -----Original Message-----
From: 	Rapp, Bill
Sent:	Tuesday, November 06, 2001 8:52 AM
To:	Miller, Mary Kay; Hartsoe, Joe
Subject:	Northern Natural Gas - Marketing Affiliate Compliance

I'm a new addition to the gas pipeline legal group, having recently transferred from the EES legal department. Among other things, I'll be handling Northern Natural's compliance with the marketing affiliate rule.

An issue has come up with Northern as a result of the recent changes at Enron Corp.

Andy Fastow is currently shown in the organizational chart on Northern Natural's electronic bulletin board as "President, Northern Pipeline Sales Division".  Apparently, he was named to this position because he was not an officer or director of one of our marketing affiliates and was also not an officer or director of Northern. This satisfied the requirements of the marketing affilate rule. Given recent personnel changes at Enron Corp., it's now necessary to find a replacement for Andy Fastow. Frazier King suggested Cindy Olson, who also is neither an officer or director of a marketing affiliate nor an officer or director of Northern.  We wanted to run this by both of you before proceeding further. We would appreciate your thoughts. Thanks.


With respect to the trade done today with Gases y Graneles Liquidos S.A.,
please find attached a Chilean Annex A for an Omnibus form of confirmation.
Please attach this form and make an election for NY law as the choice of
law.  Along with the fax of the Confirmation to the Counterparty, please also
fax a form of IRS Form W-8BEN and ask the Counterparty to complete the form
and return it to us.  Craig, can you talk to the Counterparty and make sure
they send us back the tax form?!


The file I sent earlier apparently didn't have volumes for April forward.  This file does and there are a few days where Conoco did use alternate or interruptible volumes.

Sorry for the confusion.

Dennis P. Lee
ETS
Gas Logistics
(713) 853-1715
dennis.lee@enron.com