You may have already read this but thought I'd forward on just in case.  MW

 -----Original Message-----
From: 	Vignaroli, Donald
Sent:	Thursday, October 25, 2001 9:15 AM
To:	Bowers, Janet; Brennan, Lorna; Darveaux, Mary; Fritch, Bret; Graham, Charlie; Joyce, Jane; Kirk, Steve; Sebesta, Chris; Swett, Larry; Thurber, Bob; Winckowski, Michele
Subject:

How Enron Blew It
Less than a year ago, the Houston-based energy behemoth had everything: money, power, glitz, smarts, new ideas, and a CEO who wanted to make it the most important company in the world. Now its stock is down, wall street is bearish, and the CEO is gone. What went wrong?
by Mimi Swartz </mag/issues/authors/mimiswartz.php>
THE ENRON SKYSCRAPER NEAR THE SOUTH END OF HOUSTON'S DOWNTOWN feels like the international headquarters of the best and the brightest. The lobby in no way resembles the hushed, understated entryways of the old-fashioned oil companies, like Shell and Texaco nearby. Enron, in contrast, throbs with modernity. The people hustling in and out of the elevators are black, white, brown; Asian, Middle Eastern, European, African, as well as American-born. They are young, mostly under 35, and dressed in the aggressively casual uniform of the tech industry-the guys wear khakis, polo shirts, and Banana Republic button-downs. Almost preposterously fit, they move through the building intently, like winners. Enron is nothing if not energetic: A Big Brother-size TV screen frantically reports on the stock market near a bank of elevators, while another hefty black television relaying the same news greets people entering from the garage. A sculpture of the corporate symbol, an E tipped at a jaunty angle, radiates colors as it spins frenetically on its axis; a Starbucks concession on the ground floor keeps everyone properly caffeinated. Multicolored, inspirational flags hang from the ceiling, congratulating Enron on its diversity and its values; one more giant banner between elevator banks declares Enron's simple if grandiose goal: "From the World's Leading Energy Company to . . . The World's Leading Company!"
For a while, that future seemed guaranteed, as Enron transformed itself from a stodgy, troubled pipeline company in 1985 to a trading colossus in 2000. It was a Wall Street darling, with a stock price that increased 1,700 percent in that sixteen-year period, with revenues that increased from $40 billion to $100 billion. "The very mention of the company in energy circles throughout the world creates reactions ranging from paralyzing fear to envy," notes a 2001 report from Global Change Associates, a firm that provides market intelligence to the energy business.
This Enron was largely the creation of Jeff Skilling, a visionary determined to transform American business. Hired sixteen years ago as a consultant by then-CEO Ken Lay, Skilling helped build a company that disdained the old formula of finding energy in the ground, hauling it in pipelines, and then selling it to refineries and other customers. Instead, it evolved into a company that could trade and market energy in all its forms, from natural gas to electricity, from wind to water. If you had a risky drilling venture, Enron would fund it for a piece of the action. If you wanted your megacorporation's energy needs analyzed and streamlined, Enron could do the job. If you were a Third World country with a pitiful infrastructure and burgeoning power needs, Enron was there to build and build. Basically, if an idea was new and potentially-and fantastically-lucrative, Enron wanted the first crack. And with each success, Enron became ever more certain of its destiny. The company would be the bridge between the old economy and the high-tech world, and in February of this year, Skilling reaped his reward when he succeeded Lay as chief executive officer. Enron, says Skilling, "was a great marriage of the risk-taking mentality of the oil patch with the risk-taking mentality of the financial markets."
The Enron story reflects the culture that drove American business at the end of the twentieth century. Like the high-tech companies it emulated, Enron was going to reinvent the American business model and, in turn, the American economy. Maybe it was natural that this Brave New World also produced a culture that was based on absolutes: not just the old versus the new, but the best versus the mediocre, the risk takers versus the complacent-those who could see the future versus those who could not. The key was investing in the right kind of intellectual capital. With the best and the brightest, a company couldn't possibly go wrong.
Or could it? Today Enron's stock trades at around $35, down from a high of $80 in January. The press cast Enron as the archvillain of California's energy crisis last spring, and Skilling caught a blueberry pie in the face for his relentless defense of the free market. A long-troubled power plant project in India threatened the company's global ambitions. Telecommunications, in which Enron was heavily invested, imploded. Wall Street analysts who once touted the company questioned its accounting practices. Some of the change in Enron's fortunes can be attributed to the economic downturn in uncertain times that has afflicted all of American business. But the culture that the company created and lived by cannot escape blame.
ENRON, JEFF SKILLING SAYS, HAD "a totally different way of thinking about business-we got it." At Enron, in fact, you either "got it" or you were gone-it was as simple as black and white. It is not coincidental, then, that the color scheme of Skilling's River Oaks mansion mirrors the corporation he once headed. Here, the living room's white walls shimmer against the mahogany floors. Black leather trims the edge of snowy carpets. Billowy sofas set off the jet-black baby grand. In the entry, white orchids cascade from a black vase on a black pedestal table that in turn pools onto cold, white marble. There is only one off-color note: After almost twenty years, Jeff Skilling is no longer associated with Enron, having resigned abruptly after just six months as CEO. Once, Skilling was hailed as the next Jack Welch (General Electric's masterful CEO), as one of Worth magazine's best CEO's in America (anointed in 2001), and even as a daredevil who hosted the kind of unchained adventure junkets in which, a friend told BusinessWeek, "someone could actually get killed." Today, he sounds more like Ebenezer Scrooge on Christmas morning. "I had no idea what I'd let go of," Skilling says of all the personal sacrifices he made while retooling Enron.
From a black chair in the white library, across from a huge black and white photograph of his daughter and two sons, Skilling clarifies. The demands of working 24-7 for Enron caused him to ignore his personal finances. Divorced, he lived in a 2,200-square-foot house without a microwave or a dishwasher. He almost missed his brother's wedding. "Learning a foreign language-I never learned a foreign language!" he exclaims. He never once took his youngest son to school. "I'm interested in the kids. You don't do kids in fifteen-minute scheduling." Travel: "You can't go to Africa for a week and get anything out of it!" Skilling includes the study of architecture and design on his list of missed opportunities, then he stops and sighs. "I'm not sure that fulfillment in life is compatible with a CEO's job," he says, finally. Then his eyes lock on mine, and his voice, which had softened, regains its pragmatic edge. "It would have been easy to stay," he says. "But that would not have been good for me."
He's a smallish, ruddy-faced man who keeps himself at fighting weight, handsome in the way of corporate titans, with piercing cheekbones and that assiduously stolid gaze. But the impatience Skilling once reserved for cautious underlings and dull-witted utility company executives is now targeted at reporters who have labeled his resignation "bizarre" and associates who are bitterly skeptical of his need for family time. His shrug stretches the limits of his shimmering blue button-down, and his matching blue eyes look put upon. "I'm surprised," he says, "that people have so much trouble understanding this."
PEOPLE WHO PASSED THROUGH DOWNTOWN HOUSTON in the late eighties or early nineties couldn't help but notice a funny and, for its time, novel scene unfolding throughout the workday at the base of the Enron Building. From nine to five and before and after, you could see people slipping out of the pristine silver skyscraper to smoke. They perched on the chrome banisters or lurked near the glass doors at the entry, puffing like mad. They always looked hurried and furtive, even ashamed. Whatever people knew about Enron in those days (and most people didn't know much), it was often associated with that scene: Enron boasted one of the first nonsmoking corporate headquarters in Houston, and there couldn't have been clearer evidence of its break with the energy world of the past. What macho engineer would have put up with such humiliation?
But this company was a child of another time, that period in the mid-eighties when chaos enveloped the gas business. Federal deregulation of natural gas turned a steady, secure industry, in which gas pipeline companies frequently enjoyed a monopoly in portions of the areas that they served, into a volatile free-for-all. The situation was compounded five years later by federal deregulation of the pipeline business. So it happened that a gentlemanly gas pipeline company, Houston Natural Gas (HNG) found itself under attack from Coastal Corporation, Oscar Wyatt's less than gentlemanly firm. HNG was then run by Lay, a sturdy, taciturn former economics professor and Transco chief operating officer who had a passion for military strategy. (His doctoral thesis at the University of Houston was on supply and demand in the Vietnam War.) Lay, who was from Missouri and never succumbed-at least outwardly-to Texas brashness, had done well enough: Thanks to canny expansions, HNG's pipelines stretched from Florida to California and throughout the state of Texas.
HNG fended off Coastal, but to protect the company from other takeover attempts, Lay nimbly engineered the sale of HNG in 1985 to a friendly Nebraska pipeline concern called InterNorth, one of the largest pipeline companies in the country at the time. Then, a funny thing happened: HNG started acting in a way that would characterize the company for years to come-a lot like Coastal. What the Nebraskans blithely labeled "the purchase" was being called "the merger" back in Houston, and before long, following some particularly brutal politicking between Omaha and Houston, the company's center of gravity started shifting toward Texas, and shortly after that, Ken Lay was running a new company called Enron. "Over time it became clear that Lay had a better vision of the future," says one person associated with Enron at that time. "He never fought change. He embraced change."
Lay had won, but what exactly did that mean? Enron was saddled with massive debt from the takeover attempt, and thanks to deregulation, no longer had exclusive use of its pipelines. Without new ideas-for that matter, a whole new business plan-the company could be finished before it really even got started.
LIKE MANY PEOPLE WHO TEAMED UP WITH ENRON IN THE EIGHTIES, Jeff Skilling had spent a lot of time in the Midwest, and he was self-made-at fourteen he had been the chief production director at a start-up TV station in Aurora, Illinois. (His mother would drop him off there every day after school.) "I liked being successful when I was working, and I was smart," he told BusinessWeek earlier this year. But unlike many of his Enron colleagues, Skilling wasn't deliberate and soft-spoken and happy to go home at five o'clock; he was anxious and excitable, and nothing, but nothing excited him more than what he would come to call "intellectual capital." He loved being smart, and he loved being surrounded by smart people. He graduated from Southern Methodist University, went into banking-assets and liability management-and took on Harvard Business School, where he graduated in the top 5 percent of his class. Then Skilling took the next step on what was then the new, souped-up path to American success: He joined Manhattan's McKinsey and Company as a business consultant, and that is where Ken Lay found him in 1985.
It is often said of Lay that his instincts for hiring the best are flawless, and his choice of Skilling probably saved the company. Skilling was above all an expert at markets and how they worked. While everyone else was worrying about the gluts and the shortages that defined the gas industry, he alone saw the parallels between gas and other businesses. And so in a world where credit was nearly impossible to come by, Skilling came up with what he called the Gas Bank, which contractually guaranteed both the supply and the price of gas to a network of suppliers and consumers. Enron would not be a broker but a banker. It would buy and sell the gas itself and assume the risk involved. And Enron would make money on transactions, much like an investment bank would.
Skilling worked up some numbers and found them "absolutely compelling." Then the McKinsey consultant took the idea to a meeting of about 25 Enron executives. He had a one-page presentation. "Almost to a person," Skilling says, "they thought it was stupid." Almost. After Skilling left the meeting dejected, he walked Ken Lay to an elevator and apologized. Lay listened and then said, "Let's go."
The Gas Bank was not an overnight success. For months Skilling woke up in a cold sweat, sure he had ruined not only his career but the careers of dozens of colleagues who had assisted him. In fact, he had come upon one of those divides that seem to define his life: "I believed this whole world would be different, a huge breakthrough" is the way Skilling puts it today, and even if he is typically immodest, he was right. Fairly soon after launching, the company sold $800 million worth of gas in a week. True to Skilling's character, success turned out to be a matter of old versus new: He says the joke around Enron was that if a company's CEO was under fifty, "We were in." And he was in too: In 1990 Skilling finally left McKinsey and joined Enron as the head of Enron Finance Corporation, a new division created just for him. In 1991 that company closed a deal that earned $11 million in profit. After that, says Skilling, "we never looked back."
Skilling and Lay also realized that the Gas Bank couldn't work unless it had a trading component. Myriad trades were needed to build the market that would make the project go. But by buying and selling enormous quantities of gas, Enron not only constructed a market but almost instantly came to dominate it. The company had the best contacts, the best intelligence, and the best access to supplies. That, in turn, attracted more customers who wanted to be part of the play. With so many customers in its pocket, Enron could better predict the direction of the market and could use that knowledge to make trades for its own benefit-Enron could in effect bet on which way the price of gas would go, as one might do with pork bellies or soybeans, but with startling accuracy, thereby generating profits higher than anyone could have ever imagined.
THIS CHANGE COULD NEVER HAVE OCCURRED without another change Skilling had made: He created, within Enron, a new culture to match its new trading business. The idea was to build a "knowledge-based business," which demanded a skill set not exactly prized by Enron's employees from the old HNG days. Most were deliberate, cautious, responsible, somewhat defensive people, most of them men, of course-the kind of people you'd expect to find working in an industry regulated by the federal government. But now the company needed bolder people for its bold new era: that included anyone who wanted to make money-lots of money-for themselves and for the company. "Enron was going to create a niche for itself or die," one former executive explains. "The people who had narrow views eventually were forced out, because if they had narrow views about other things, they had narrow views about the market."
Skilling wanted smart people but not just any smart people. He wanted the smartest people from schools like Harvard, Stanford, and maybe, Rice. And because his firm was now acting more like a bank than a pipeline company, he wanted to draw from the pool of recruits that would be attracted to the biggest and best investment banks, like Merrill Lynch or Credit Suisse First Boston. In addition to being smart, Enron people were also supposed to be "aggressive." You were right for Enron if you didn't want to wait until you were thirty to close your own deals or move up in an organization.
You could see what he was looking for on "Super Saturdays" at the Houston headquarters: eight fifty-minute interviews with ten minute breaks in between-the company might herd as many as four hundred people through in just one day. They were scored from 1 to 5 on their smarts, their problem-solving ability, their passion for hard work, and what at Enron was called "a sense of urgency." People who scored less than 2.5 were scratched. The shrewdest candidates knew how to work Enron before they were even hired: These were the types that automatically turned down the company's first offer, knowing Enron would come back with more. The starting salary was around $80,000. Maybe it wasn't a fortune-yet-but the signing bonus, about $20,000, was more than enough for a lease on the obligatory Porsche Boxster or one of the lofts being renovated close to downtown. (Enron people didn't live in far-flung suburbs. Suburbs were uncool and too far from the office.)
For the lucky winners, Enron offered the corporate equivalent of a gifted-and-talented program. New associates learned the latest techniques for structuring energy deals, and there were rotations at Enron offices around the globe. The hours were long, but every possible need was taken care of. A company concierge handled all the things important people couldn't be bothered with: picking up dry cleaning or prescriptions, shining shoes, cleaning the house, planning a vacation. Of course, a lot of people who worked for Enron never got to take vacations-they were too busy making money-but they could use the company gym and the company's personal trainers. If they were overweight or wanted to quit smoking, they could join Enron's Wellness Program. Massages were offered six days a week, from seven in the morning until ten at night. "They were so cutting edge," rhapsodizes someone involved with the company health care program at the time. "They really thought about the psychology and what it took to keep these people going."
Skilling handed out titles analogous to those at Wall Street firms-analysts, associates, directors, and managing directors-but everyone knew that those titles didn't really matter. Money did. Instead of competitive salaries and decent bonuses, Enron offered competitive salaries and merit-based bonuses-with no cap. "If you really worked hard and delivered results, you could make a lot of money," says Ken Rice, who stayed with Enron for 21 years until resigning recently as the head of the company's faltering broadband division. Or, as the saying goes, you got to eat what you killed. Gas traders with two or three years of experience could wind up with a $1 million bonus. And the more you produced, the closer you got to Jeff: Real hot dogs joined him glacier hiking in Patagonia, Land Cruiser racing in Australia, or off-road motorcycling in a re-creation of the Baja 1,000 race, ending at a spectacular Mexican villa. "Every time he'd speak, I'd believe everything he'd say," one loyalist says.
And why not? By 1995 Enron had become North America's largest natural-gas merchant, controlling 20 percent of the market. But at a company where the buzzword was "aggressive," that was no place to stop: Skilling and Lay believed the Gas Bank model could easily be applied to the electricity business. Firmly committed to the notion that a deregulated market meant better service at lower prices for consumers (and untold profits for Enron), they began barnstorming the country, pressing their case with entrenched power company presidents (who, with their multimillion-dollar salaries and monopoly service areas, had little incentive to change) and energy regulators (who were somewhat more receptive, thanks in part to Enron's generous lobbying efforts).
But the biggest winner of all was probably Jeff Skilling. In 1997 Ken Lay made him the president and chief operating officer of the company. By then, the division known as Enron Capital and Trade Resources was the nations largest wholesale buyer and seller of natural gas and electricity. The division had grown from two hundred to two thousand employees, and revenues from $2 billion to $7 billion. "Mr. Skilling's experience so far with the turmoil in the industry has convinced him that he is on the right track," the New York Times noted. Everyone would certainly have thought so: Enron and Skilling had totally transformed one industry and were well on their way to transforming another.
"FIRING UP AN IDEA MACHINE; Enron Is Encouraging the Entrepreneurs Within," sang the New York Times in 1999. "In the staid world of regulated utilities and energy companies, Enron Corp is that gate-crashing Elvis," crowed Fortune in 2000. Wall Street was demanding tech-size growth on a tech timetable, and Enron, in 2000, obliged with second quarter earnings of $289 million, up 30 percent from the previous year. That year the company seemed to discover a market a minute: Under Skilling, Enron was trading coal, paper, steel, and even weather. No one blinked when a London wine bar became an Enron client. People drank more in warm weather than cold, so why not buy a hedge against the usual winter downturn?
But most exciting to the financial world was Enron's entry into high-tech communications. Because of the company's marketing dominance, EnronOnline became another overnight success, handling $335 billion in commodity trades online in 2000. Enron, as usual, made its money on the spread between the bid price and the asking price. Then there was the broadband business: To Enron, trading excess capacity in large, high-speed fiber-optic networks (empty lanes on the fabled information highway) wasn't that different from trading the capacity of natural gas pipelines. So Enron created a market for what the industry calls bandwidth. Soon after, it also announced a twenty-year deal with Blockbuster to deliver movies on demand electronically to people in their homes. Enron looked like a company that couldn't lose. "Its strategy of building businesses, shedding hard assets, and trading various commodities can help it do well even in an uncertain market," BusinessWeek insisted.
There was, however, another reason Enron did so well in such a short time: the company's hard-nosed approach toward its customers. The old notion of customer service was based on the long haul-you had to nurse and coddle customers to keep them. But Enron had new markets and new ideas-customers had to come to it. Over time, the company stopping referring to its business clients as customers and began calling them "counterparties."
Skilling wanted the biggest profits on the shortest timetable: Gains were maximized by creating, owning, and then abandoning a market before it became overtaxed and overregulated. So if you wanted to launch a high-risk venture quickly-such as Zilkha Energy's new high-tech approach to drilling for oil-you got your financing from Enron because a bank would take forever to underwrite the project, if it ever would. But because Enron invented its markets and subsequently dominated them, Enron could set the terms of its deals, from the timeline to the method of accounting to whether the deal happened at all.
While many businesses used what was known in the industry as "mark-to-market accounting," for instance, Enron used it on an unprecedented scale. The company priced their deals at current market value-but it was always Enron's idea of the market value; companies that balked at their pricing didn't get deals. And while old-fashioned companies spread their profits out like annuities over a period of years, Enron took most of its profit up-front. However many millions would be made on a deal that covered several years, they went on the books in the current year. If a few analysts thought there might be something fishy about what they called "subjective accounting," investors didn't particularly care as long as the profits rolled in. As the market fluctuated and the landscape changed, the company might abandon a project that had been in the works for months because its profit margins weren't going to be high enough. "Enron is known for leaving people at the altar," says one former employee. Winning the highest possible profits for the company could even extend to Enron's attitude toward charity. When a fundraiser for the Houston READ Commission, a literacy group, called on Enron for a contribution, it was suggested that he start raising money for Enron's competing literacy charity: "Even the person who was supposed to give money away for Enron was supposed to make money for Enron," he says.
As Enron became more and more successful, the culture Skilling had created took on a dark side: The competition turned inward. As one member of the Enron family put it, "It became a company full of mercenaries." The change started at the bottom. As Enron's domination of the energy market grew, most of the recruiting frills fell away. New associates were treated much like the commodities the company traded. Global Change's Enron spies reported overhearing orders like "I need a smart person-go buy me one" or "Buy me an intelligent slave, quick." Enron had never been the kind of place where people sang to you on your birthday, but now the workaholism bordered on self-parody: A Random Acts of Kindness program lasted only a few months. It was too disruptive. People couldn't get their work done.
And, of course, Enron had a program for institutionalizing creative tension. The Performance Review Committee, which had initially been installed by Skilling in the Capital group, became known as the harshest forced ranking system in the country. Employees were rated on a scale of one to five, and those with fives were usually gone within six months. (The PRC's nickname quickly became "rank and yank.") It was a point of pride that Skilling's division replaced 15 percent of its workforce every year. As one Skilling associate put it, "Jeff viewed this like turning over the inventory in a grocery store." Skilling's approach to business-get in and get out-had become Enron's attitude toward its workers. In time, it would become many workers' attitude toward the company. Teamwork, never that valuable in a trading culture, went the way of the eyeshade and the abacus. If protocol required an Enron higher-up to come from Europe to help with a project in the Third World, he might help-or he might not, depending on whether another, potentially more lucrative project was pending elsewhere.
Everyone felt the pressure to perform on a massive scale at massive speed: "They were so goal oriented toward immediate gratification that they lost sight of the future," says one former employee. Anyone who couldn't close deals within a quarter was punished with bad PRC scores, as were the higher-ups who had backed them. Past errors and old grudges were dredged up so often as new ammunition in PRC meetings that the phrase "No old tapes" became an Enron clich?. "People went from being geniuses to idiots overnight," says one former Enron executive.
In such a hothouse, paranoia flowered. New contracts contained highly restrictive confidentiality agreements about anything pertaining to the company. E-mail was monitored. A former executive routinely carried two laptops, one for the company and one for himself. People may have been rich at Enron, but they weren't necessarily happy. One recruiter described the culture this way: "They roll you over and slit your throat and watch your eyes while you bleed to death."
BEFORE JEFF SKILLING COULD TRANSFORM ENRON from the world's leading energy company into the world's leading company, he had to make one more change: Just as he had done ten years before, Skilling had to purge the company of its remaining old order. Where Enron once prized cautious executives who dealt with tangible assets like pipelines, it now valued bold executives who dealt with intangible assets. Pipelines, power plants-they may have been Enron's pride, but Skilling wanted them gone. Expensive, long-term building projects had no place when Wall Street was devoted to quick profits and enormous returns on investment capital, and Skilling knew it. "It wasn't the time for long-term approaches," an Enron executive says of Wall Street's mood. "It was the technology era."
To rid Enron of the last vestiges of its past, Skilling had to take on Rebecca Mark, long considered his rival for the CEO's job. Mark was for many years the poster child for the Enron way: Young, attractive, aggressive-her nickname was Mark the Shark-she came from sturdy Midwestern stock but had the requisite Harvard MBA. Mark was largely responsible for the success of Enron International, the asset-heavy side of the company where she developed $20 billion worth of gas and power plants, which accounted for 40 percent of Enron's profits in 1998. For this she reaped breathtaking compensation-one Enron executive estimated $10 million-and adoring press clips, including two appearances on Fortune's list of the fifty most powerful women in corporate America.
But then Mark ran into trouble with a gas-fired power plant in Dabhol, India, one of the largest ever constructed. She had played the game the Enron way: Taking Enron into a new market, she had finagled low import taxes (20 percent instead of the usual 53) and hung in through 24 lawsuits and three changes in government. But the time and expense needed to make India and other Enron plants around the globe successful did not mesh with Enron's goals, and Skilling's impatience with Mark grew.
Forcing Mark out, however, was no easy matter. Key executives left, divisions were dismantled, but she remained. The truth was Enron didn't mind firing lower-level employees, but it hated to fire the kind of aggressive, relentless people it tended to promote. The company preferred humiliation-keeping a director in his cubicle, say, but failing to include him in the glamour deals, or kicking someone upstairs with a fancy title. (One particularly difficult executive won a few years at graduate school, gratis.) A company as smart as Enron could probably deduce too that dispatching one of the most visible businesswomen in the country would provoke a public-relations disaster. So Lay and Skilling did something classically Enronian: They gave Mark her own company. Despite Skilling's contempt for asset-heavy businesses, Enron spent more than $2 billion to buy a run-of-the-mill British water utility that could serve as Enron's entry into the emerging world of water privatization. Mark was put in charge of making Enron, yes, the world's greatest water company. Azurix, as the new business was called, looked like another sure thing: Its IPO in 1999 raised $695 million.
But Mark had to succeed on Enron's increasingly abbreviated timetable in a business fraught with political and emotional complexities. Water is not like gas or electricity-owners and governments are a lot less willing to give it up, even for lots of money. The company stumbled, layoffs commenced, and confidence evaporated. By August 2000 the stock price, which had started out at $19, had fallen to $5. Mark's resignation followed, and Azurix, much diminished, was folded into Enron. "I think it's best for Rebecca to start afresh," Lay, who had been a mentor to Mark, told the Wall Street Journal. Or as one critic put it, "They were more interested in destroying the old culture than running a business."
As 2000 drew to a close, Skilling was in total command. In December Ken Lay announced the inevitable: "The best time for the succession to occur is when the company is doing well," he told the press. "Enron is doing extremely well now." In February 2001 Jeff Skilling took over the CEO's job.
ALMOST IMMEDIATELY THE TROUBLE STARTED. Enron's domination of the electric-power market made it an instant target in the California deregulation debacle. Both PBS's Frontline and the New York Times took on Enron, portraying the company as a heartless colossus that used its influence in Washington (Lay and Enron's political action committee are the top contributors to George W. Bush) to force old people on fixed incomes to choose between buying food or electricity. Skilling and Lay appeared on camera singing belligerent anthems to the free market, while another memorable scene juxtaposed one of the company's jackallike traders against a hapless state employee in California, as both tried to buy power online. The Times reported that Lay had tried to persuade a new federal commissioner to change his views on energy deregulation. The bad press was, to say the least, ironic: Just as the media was pounding Enron for its omnipotence, Wall Street was discovering its weaknesses. By late March the stock price had slid to $50 a share from $80 in January.
Within Enron, the asset-based divisions took the rap for the decline. (The India plant continued to be enormously costly, at least in part because of constant turnover within Enron's management team.) But the California situation was more visible and therefore more damaging, despite Enron's claim that the state had never built enough power plants to service its population and never properly managed those it had. "For three months Gray Davis did a very good job of blaming us," says Mark Palmer, a vice president for corporate communications. "We were a Texas company. There was a Texan in the White House. California was a state that didn't put him in office, and his biggest contributor was a Texas energy company. Performance is going to take care of our stock price. The truth will take care of Gray Davis." (California utilities still owe Enron $500 million, another reason stockholders might be panicky.) But more problematic than the crisis itself was Skilling's all too apparent lack of contrition. Facing down his critics, he cracked a joke comparing California with the Titanic. ("At least the Titanic went down with its lights on.")
But the biggest problem was Enron's telecommunications division, which had been responsible for at least one third of its heady stock price. Investors believed that Enron could revolutionize high-speed communications, just as it had revolutionized gas and power. Enron estimated the global market for buying and selling space over fiber-optic cable would grow from $155 billion in 2001 to $383 billion by 2004-but then the tech bubble burst. So too did the much-hyped movies-on-demand deal with Blockbuster. For the first time in its confoundingly successful life, Enron had nothing new to take to market. Like the popular high school girl who suddenly packs on a few pounds, Enron suddenly looked less alluring to Wall Street.
Skilling launched a campaign to keep Enron's most important cheerleaders, the stock analysts, in the tent, but he wasn't cut out to be a supplicant. During the reporting of first quarter profits, he called an analyst who challenged Enron's financial reporting an "asshole." When the company reported hefty second quarter profits, many analysts questioned whether those profits had come from the generation of new business or from the sale of old assets. Ignoring the growing chorus critical of Enron's accounting, Skilling promised, as he always had, that innovations were just around the corner. "There wasn't any positive news," Carol Coale, of Prudential Financial, says now. "Basically, he talked me out of a downgrade."
The business press, so generous in the past, turned surly. Fortune had asked in March whether Enron was overpriced. ("Start with a pretty straightforward question: How exactly does Enron make its money?") The routine cashing in of stock options that were about to expire by key executives was portrayed in the media as a fire sale. (Skilling had sold $33 million worth, Ken Lay and Ken Rice close to four times that amount.) Then the Wall Street Journal reported on a fund run by the CFO that had been a source of strife within the company. (It was essentially risk management against Enron's possible failures.) Every negative story seemed to produce a concurrent drop in the stock price: By late August it had fallen below $40. Enron, so institutionally unforgiving, finally got a taste of its own medicine. "When Wall Street is in love with a stock, they're forgiving of something like accounting," says Carol Coale. "When a company falls out of favor, all these issues carry more weight."
This fact was not lost on people inside the company, who suddenly started experiencing an attack of conscience. Those who had looked the other way as the most powerful Enron executives dumped their wives and married their secretaries or carried on flagrant interoffice affairs now saw the error of their ways. "It just created an attitude," one executive still at Enron says. "If senior people are doing that, why are we held to a higher standard? There was a real culture of 'We're above everyone else.'"
Loyalty had never been prized at Enron, so there was no reason to expect it now. An old-fashioned, slow-moving company like Exxon could demand hardship duty in Baku with the promise of greater rewards down the road. "But," as one Houston oilman explains, "if you have to negotiate a hardship duty with someone who doesn't have loyalty and has money, then you have a corporation that's better suited for good times than bad."
As it turned out, that description applied to Jeff Skilling too. As the stock price stubbornly refused to ascend, he made no secret of his unhappiness and frustration. Then, after a trip to visit the families of three employees killed at a plant in England, he had an epiphany: Life was short; for him, Enron was over. Ever stoic, Ken Lay returned to the CEO's office, named a new president, arranged a trip to New York to calm analysts and investors, and promised a kinder, gentler Enron in the future. Trading anything and everything was out. The company, Lay says, will still innovate but "innovate much closer to our core." As for the culture: "Things like the Performance Review Committee, I think we could have applied better. By trying to categorize people into so many different categories, you ended up creating a morale problem."
That Skilling's supposedly brilliant colleagues were as shocked at the news of his departure as the rest of the business community may be testament to their lack of emotional intelligence. Despite Skilling's lengthy tenure with Enron, he'd always been contemptuous of the long haul; he'd always believed in cutting losses and moving on. But now that he was abandoning them when the company was in trouble, it was different. "Even Jeff's biggest detractors wouldn't have wanted him to walk out the door," one loyalist admits.
But on the day we meet, Skilling is looking forward, not back. "Look," he says with finality, "ninety percent of my net worth is in Enron. Were my interests aligned with the shareholders? Absolutely."
Free of falling stock prices and shareholder pressures, he is nestling himself back into the world of ideas. His eyes flash as he talks about new technologies. "The first wave never gets it right," he says. "The stand-alone dot-coms didn't work, but the technological applications will create a second wave that will change the world." Houston, he promises, will become the world's center of commodity trading, and he intends to be a part of it. In fact, he is already shopping for office space.
"This is the second wave, and Enron's got it," he says, almost breathless. "There are thousands of people running around the streets of Houston that get it."


Dear Tracy,

Save up to $50 when you book a Delta Vacations package ONLINE to your
favorite destination!  Book NOW as this offer is for a limited time
only!

http://lists.deltavacations.com/UM/T.ASP?A42.52.2.1.tracy*Pgeaccone*Denron*Pcom

We've done everything for you except request the time off!

Don
Your Dream Vacation Specialist

Please click here to update your travel profile:
http://lists.deltavacations.com/UM/T.ASP?A42.52.2.2.tracy*Pgeaccone*Denron*Pcom

************************************************************
              This is a post-only mailing.
    PLEASE DO NOT ATTEMPT TO RESPOND TO THIS MESSAGE.

************************************************************
-----------------------UNSUBSCRIBE--------------------------

To unsubscribe from the list please click here:
http://lists.deltavacations.com/UM/T.ASP?A42.52.2.2.tracy*Pgeaccone*Denron*Pcom

Please type in your email and password. Once you have accessed your
Travel Profile, please clear the checkbox for "receiving emails" located
at the bottom of the page.

We apologize if this email has reached you in error.


Greg

Thanks for taking the time to interview Nigel.  If you like him please sell
him hard on
---------------------- Forwarded by John J Lavorato/Corp/Enron on 09/29/2000
12:43 PM ---------------------------

	From:  Kimberly Hillis @ ECT                           09/29/2000 09:52 AM

To: John Arnold/HOU/ECT@ECT, Fletcher J Sturm/HOU/ECT@ECT, Kevin M
Presto/HOU/ECT@ECT, Mark Dana Davis/HOU/ECT@ECT, Rogers Herndon/HOU/ECT@ect,
John J Lavorato/Corp/Enron@Enron, David W Delainey/HOU/ECT@ECT, Greg
Whalley/HOU/ECT@ECT
cc: Ina Rangel/HOU/ECT@ECT, Kay Chapman/HOU/ECT@ECT, Felicia
Doan/HOU/ECT@ECT, Tamara Jae Black/HOU/ECT@ECT, Airam Arteaga/HOU/ECT@ECT,
Jessica Ramirez/HOU/ECT@ECT

Subject: Nigel Patterson

Below please find a copy of the resume and the itinerary for Nigel
Patterson.

If you have any questions, please do not hesitate to call me or John Lavorato.

Thanks for you help.

Kim
x30681

12:30 - 1:00  Rogers Herndon  (EB3320)

1:00 - 1:30  Kevin Presto   (EB3320)

1:30 - 2:00  Dana Davis   (EB3320)

2:00 - 2:30  Dave Delainey  (EB3314)

2:30 - 3:00  John Arnold   (EB3320)

3:15 - 4:00  Greg Whalley   (EB2801)

4:00 - 4:30  Fletch Sturm   (EB3320)


1.  Need details re item 1  below.  Please suggest language (band of
acceptability, etc) which I will massage and incorporate.

6.  Do I have the latest draft of Marketing/Risk policies?

7. Bogey calc only addresses gas.  What if the fuel of choice is fuel oil?
Does the fuel cost and heat rate change?

Please point me to the defn of profit by cutting and pasting from wherever it
is.  I did  a quick search and couldn't find it, but I didn't do a page turn
to locate it.

Thanks,

Kay

From: Reagan Rorschach/ENRON@enronXgate on 05/24/2001 11:38 AM
To: Kay Mann/Corp/Enron@Enron
cc:

Subject: FW: Open items for MDEA

 -----Original Message-----
From:  Fairley, David
Sent: Thursday, May 24, 2001 11:15 AM
To: Rorschach, Reagan
Subject: RE: Open items for MDEA

 -----Original Message-----
From:  Mann, Kay
Sent: Wednesday, May 23, 2001 5:06 PM
To: Rorschach, Reagan; Kroll, Heather; Fairley, David; May, Tom
Subject: Open items for MDEA

[Fairley, David]

Here are issues which I'm unclear about, all of which impact the drafting of
the agreement:

1. How are we setting the heat rate?  Do we have the GADS (?)?  Is it a daily
average, weekly average?  Flat rate? Adjusted? If so, how often?
[Fairley, David]
Each utility is obligated to provide the heat rate information to use in the
appropriate Exhibit and the Stack Model.  As conditions change the utilities
must update this info.  We are tracking heat rates based on actual fuel
usage.  Services and Orig agreed yesterday to add language that requires a
quarterly review of heat rate data to determine if the assumptions being used
are satisfactiry -- it can never be exact, but it should be accurate within a
band of acceptability.  No GADS.  Heat rates will be adjusted in the model as
often as necessary to account for significant changes such as hotter ambient
temps..

2. Are we comfortable that there are no permit restrictions?
[Fairley, David]
Yes, their units are too small.  We have discussed this with the customer,
and with our internal air permit guys.
[Rorschach, Reagan]  They have Title V permits, and they are faxing them to
us today.  They have no run hour limitations on gas, however, they are
limited on oil.  Will need to get that summary to Kay as soon as possible.

3. We have determined that we won't deal with fuel oil, right?
[Fairley, David]
We won't buy and sell fuel oil.  We may dispatch on oil at start-up, or we
may switch to oil and sell the gas if profitable, which constitutes a Product
transaction with the resulting profit split.
[Rorschach, Reagan]  We need to state that MDEA and Cities are responsible
for maintaining fuel oil supplies.

4. We aren't making money on gas, right?
[Fairley, David]
We make money on gas two ways.  The first is outside the contract, and is
basicly any internal profit on re-sale of gas to the Cities.  The second way
we can make money on gas is when the gas trade is in the form of a Product
trade, and those procedures apply.

5. Do we have a defn of costs that we like yet, and if so, how does it fit in
to the picture?
[Fairley, David]
Yes, will send separately.

6. Is there an up-to-date set of exhibits?
[Fairley, David]
The Marketing Strategy, the Trading and Risk Policy, and the Description of
Asset Management have been upated.  The other Exhibits have not been
modified.  The Marketing Strategy and Trading & Risk Policy have been
discussed at length with MDEA (MDEA commercial, not legal), and their
comments/questions incorporated.

7. It would help if theh commercial part of the team could send me the
following, in words and/or formulae:

The defn and method of establishing the bogey (target production cost)
formula can be an exhibit, which would be great for the commercial team to
work on.
[Fairley, David]
Thought we had this covered in the definitions and obligations of the
parties.  Will look at it again.  Conceptually, MDEA, Services Group, and
Orig are in full agreement, so we need to make sure that the contract
language is clear enough.
[Rorschach, Reagan]  See attached exhibit detailing the calc with an example.

 Are we determined how we should deal with imbalances (part of cost of
power)?
[Fairley, David]
There are three considerations on this: (1) who wears imbalance exposure?,
(2) who manages imbalances (hourly type activity), and (3) who pays for
imbalances?  Imbalances are billed by Entergy directly to MDEA under their
Network Services Agreement.  EPMI's hourly desk manages the load/resource
items hourly, but MDEA has the exposure (physical and price) to imbalances.
Weather/load changes, and fluctuations in supply create hourly imbalances
(they happen, they are uncontrollable, and we fix them) which EPMI's hourly
desk manages as part of the imbalance service described in the definitions
and obligations of the parties.  A different section in the contract states
that MDEA wears the exposure.

 How are we setting the bogey?    Formula?   [Fairley, David]  The bogey is
set when the load projection and stack models are run each day.  Both parties
participate by providing certain necessary info and discussing results and
planning the day's activities.
[Rorschach, Reagan]  Records of bogey decisions will be archieved

Subject to audit?  [Fairley, David]    Yes, but they would be auditing
something that is jointly derived each day.  Frankly, they would like to have
less involvement; ie, they trust us to do it all, but we are requiring them
to participate and buy in every day.

Two bogeys or one (gas and oil)?
[Fairley, David]
One bogey for power.  Gas is an input for determining the bogey.
[Rorschach, Reagan]  Bogey set day-ahead.

What is defn of profit?  I think I have the general idea, but a sentence or
two would be helpful as a reality check.
[Fairley, David]
This is in the pricing calc's.  Should we have a definition?

What costs are included on the buy and sell side [Fairley, David]  see cost
definition being provided separately.

Re stack model: a sentence or two describing what it is and how it is used.
[Fairley, David]    See definition in my mark-up's to the main agreement.

Updated exhibit on facilities, contracted resources, operating limits.
[Fairley, David]   Services and Orig are reviewing these, but other than what
was mentioned above, probably no changes unless you see a specific area that
is a problem.

What information does MDEA need for us to provide in order to split
costs/profits?  Are we clear that Cities buy gas, MDEA buys/sells power?
[Rorschach, Reagan]  I will be getting exhibits of the reporting both daily
and monthly.  We need to make sure to limit our info providing
responsibilities to those reports.

It would be great if I could get one set of answers to these
questions/issues, which has commercial buy in all around.

Thanks,

Kay


Sara;

I think I am getting old ... Did you ever forward to me an updated copy of
the "swap matrix" for Brazil ?  Would you mind re-sending it to me ?!

Hope all is well !!

Thanks and Regards,

Sami

Sara Shackleton@ECT
05/04/2000 04:29 PM
To: Sami Arap/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc: Andrea Calo/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT

Subject: Re: Financial Trading in Brazil

Hi, Sami!  Sorry we missed the call yesterday.  I just wanted to update you
on some of the financial trading issues in Brazil (and I have added you to
the working group list).  I am going to finalize our "swap matrix" for
Brazil.  On the physical trading side, I had asked a physical trading lawyer
to call you and am wondering if Elizabeth Sager ever called or emailed.
Please let me know.  Thanks.  Sara
---------------------- Forwarded by Sara Shackleton/HOU/ECT on 05/04/2000
02:55 PM ---------------------------

"MBTOS - Marcelo Rodrigues" <Mbtos@tozzini.com.br> on 05/04/2000 01:21:59 PM
To: Sara.Shackleton@enron.com
cc: Andrea.Bertone@enron.com, Brent.Hendry@enron.com, Lynn.Aven@enron.com,
Rick.Hopkinson@enron.com, afac@tozzini.com.br, Krishna@tozzini.com.br
Subject: Re: Financial Trading in Brazil

Dear Sara:

Thank you for your message below. Please find attached hereto free
translation into English of new foreign investor's regulations in Brazil. We
are preparing a memo to you in connection with such new regulations and are
finalizing the matrix prepared last year. We will send them to you shortly.

Kind regards,

Marcelo Rodrigues

>>> "Sara Shackleton" <Sara.Shackleton@enron.com> 05/04 12:08 pm >>>

AFAC and Marcelo:  I hope this message finds you both well.  I would like to
finalize the matrix which was prepared last year so that we can create a
"baseline" for future updates.  Please feel free to date the matrix as of
December, 1999, if you wish.  Please forward any recent changes to me for
comment  and I will respond immediately.  Then we can move on to other things!
Thanks for your help and attention to this mattter.  Regards.  Sara
---------------------- Forwarded by Sara Shackleton/HOU/ECT on 05/04/2000
10:34
AM ---------------------------

"MBTOS - Marcelo Rodrigues" <Mbtos@tozzini.com.br> on 03/13/2000 06:27:26 PM

To:   Sara.Shackleton@enron.com
cc:   Brent.Hendry@enron.com, Lynn.Aven@enron.com, afac@tozzini.com.br
Subject:  Re: Financial Trading in Brazil

Dear Sara:

Thank you for your E-mail below. We will be reflecting the new changes in the
regulations in the chart and will be sending it to your review as soon as
possible.

Kind regards,

Marcelo Rodrigues

>>> "Sara Shackleton" <Sara.Shackleton@enron.com> 03/13 2:29 pm >>>

Greetings to you both!  It has been awhile since we last spoke.  I would like
to
finalize the matrix which we have been discussing since the latter part of
1999.
Although we were awaiting new Central Bank regulations, I am beginning to
think
that the Central Bank revisions will not impact the matrix except with respect
to transactions which may be entered into by entities that are the subject of
the Central Bank regulations.  Please let me know whether or not you agree or
can offer any suggestions.  Thanks and regards.  Sara

 - Res2689a.doc
 - Ins325a.doc


Dave,

I placed the file in O://Industrial Markets/Fundamentals/Paper/Pulp/Pulp Newsletter
Monika

 -----Original Message-----
From: 	Allan, David
Sent:	Monday, July 30, 2001 3:18 PM
To:	Causholli, Monika
Cc:	Carter, Karen E.; Determeyer, Peggy
Subject:	RE: restaurant guide

Thanks very much! I'll check it out.

Monika, could you forward to me the file with your market pulp originator newsletter in it? Some of our originators would like to send it out of the company to potential counterparties, and I would like to look at the wording to make sure we can send it out: the wording for an internal document may be more frank and open than a document that's intended for external distribution.

Peggy, did I hear you say you got some legal language for a disclaimer for steel? I wonder if we can use that on the market pulp and other originator letters to make sure they can be used externally?

 -----Original Message-----
From: 	Causholli, Monika
Sent:	Monday, July 30, 2001 1:57 PM
To:	Allan, David
Subject:	restaurant guide

Dave,

Here is the website that has all restaurants in Houston. In addition, it has info on events and other things going on in Houston. For restaurants look on the left site and they are categorized by cuisine, neighborhood, or price.

http://houston.citysearch.com/?brand=sidewalk

Monika


Group,
Just a quick reminder.  We have a meeting April 11 at 4:30 in the afternoon.
We will review ytd performance of the group, areas where we are doing well,
and areas for improviement.  Please bring your thoughts and material to take
notes.  We will also have a couple Hot Lips Pizzas again.

Additionally, I have not heard from all of you regarding the class on April
27th and 28th.
The course is Electric System Operation for the Non-engineer.  The course
highlights include:
Generation
Transmission and Overhead
Distribution Systems
Underground Distribution
Switchgear
Voltage Control
Matching Generation

The course will purportedly provide a comprehensive understanding of system
operations including fossil fuel, hydro and nuclear generation, transmission
and distribution.  The course should provide not only technical information
but also economics of operation, system and equipment protection and safety.

If I have not heard from you by Noon on the 11th, I will assume that you are
not interested.
Thanks,

Bill


Attached is an e-mail that I sent to my management earlier this week.

A also have a couple of questions and observations.  First, do we have
anything in writing from PG&E when they refused to comply with our request to
revise their Roll-off Matrix?

Also, I spoke with Jeff who informed me of the various variables that the
market has to work with to negotiate with PG&E.  I agree with the following
variables:
extend the rate freeze beyond 2001, but no later than the end of 2004.
a $3.5 to $4.0 billion hydro valuation on January 1, 2002 to cover TRA and
TCBA undercollections at that point in time, with future payments based on a
revenue requirement calculation and a fixed rate of return.  These fixed
payments will be offset by the wholesale market revenues for the hydro
output.  Ratepayers will have to make up the difference in the future through
a balancing account and fixed surcharge or surcredit; in financial derivative
terms this is is the equivalent of a negative index (fixed revenue
requirement - market revenues presumed to be the PX).  This essentially NPVs
the cashflows to payoff shortfalls today at the risk of creating shortfalls
in the future to the extent that the value is too high.
increase the level of the frozen rate at some modest amount.  Keep in mind, a
$10 per mWh increase in PG&E's rates beginning January 1, 2001, translates to
a $155 million hit to the book for 2001 through 2010, so we would need an
offsetting benefit.  We could probably offset this hit if the rate freeze was
extended through March 31, 2002.
allow PG&E to hedge procurement costs for the extended frozen time period.
it is critical that the rate freeze does not end before July 1, 2001 for all
customers, including large and small and DA and SO.  Preferably the rate
freeze would end no earlier than December 31, 2001 or 2002.  They can also
extend the rate freeze for a longer period of time for small customers or
change the freeze to an SDG&E type of mechanism beyond December 31, 2001.
The following is PG&E's situtation.

As you can see that they will be trying to cut their losses, even though they
have still not fully collected all outstanding undercollections.
Undercollections are projected to grow through next year.  What PG&E will be
looking for is a way out or a swaption to switch customers from the fixed to
index asap.  I don't think they will be so quick to do give up $500 million
at this point and will be interested in some type of settlement that would
protect this amount.  There is still the political hot potato about rolling
off early and selling out customers and the only way they could do this is
with a quick valuation of hydro.  Maybe they would be willing to take some
loss even in a settlement to avoid upsetting politicians and customers.  If
the process is delayed, PG&E's exposure will probably be over $1 billion by
the end of the year and possible $2 billion by the end of 2001.  So you see,
there would be a need for some combination of a slight increase in rates,
extension of the freeze to capture the backwardation in commodity price, and
a higher hydro valuation with ratepayers incurring the risk for the higher
valuation in the future, in exchange for a deal that insulates ratepayers
from volatility and rate shock today.
It is key that the extended Rate Freeze equitably treats DA customers in the
form of today's rate freeze with a PX credit that is not capped.

Roger
---------------------- Forwarded by Roger Yang/SFO/EES on 09/21/2000 01:52 PM
---------------------------

Roger Yang
09/19/2000 10:28 PM
To: Dennis Benevides/HOU/EES@EES, Scott Stoness/HOU/EES@EES
cc: Marty Sunde/HOU/EES@EES
Subject: PG&E Strategy to End the Rate Freeze Early and Potential Book Impact

PG&E filed Advice Letter 2010-E-A on September 15 requesting to revise its
hydro value estimate of a $1.0 billion previously filed in June to $2.8
billion, retroactively effective on June 23, 2000.  Although PG&E does not
state the intent to end the rate freeze, effective July 1, 2000, it is clear
that PG&E will claim that the $2.8 billion interim valuation will render the
rate freeze as having ended retroactively on July 1, 2000 if the CPUC
approves this advice letter.  Our estimates show that this is viable;
however, PG&E will be undercollected by $682 million in its Transition
Revenue Account.  It is unclear whether PG&E is willing to forego this
undercollection in order to avoid incurring higher undercollections from the
run-up in electric commodity prices under a rate freeze, or if PG&E has some
other plan to recover this undercollection as a post-freeze rate adder.  Even
though Decision Nos. 00-02-048 and 00-06-004 adopt ratemaking methodologies
to establish an interim valuation that triggered PG&E's Advice Letter
filings, this decision states that "[the CPUC] will address the impact of
this accounting on the end of the rate freeze at the appropriate time and in
the appropriate proceeding." (p. 10)  Hence, there is no conclusive decision
that states that this interim valuation should be used to end the rate
freeze.  In fact, the utilities had argued the contrary, it could not be used
in this manner.

Since PG&E has already sent out bills for August and should alreay wdy have
sent out bills for September by the final resolution of this Advice Letter, I
believe the earliest implementation date for ending the rate freeze would be
October 1, 2000.  In addition, I would have to believe that allowing PG&E to
implement an end to the rate freeze effective July 1 would violate codes on
retroactive ratemaking since it would result in an immediate increase to
PG&E's customers.  The book impact to EESI for a termination date of October
1 would be a $127 million loss.  A delay to an October 1 end date would
result in an undercollection for PG&E greater than $1.2 billion.  PG&E will
try to recover this undercollection in future rates if the end date is
October 1.  To the extent that such recover is delayed and recovered over an
extended period of time, the impact on the book could be minor due to the
expiration of many of our contracts in 2002.

AB1890 Section 368.a states, "These [frozen] rate levels for each customer
class, rate schedule, contract, or tariff option shall remain in effect until
the earlier of March 31, 2002, or the date on which the commission-authorized
costs for utility generation-related assets and obligations have been fully
recovered.  The electrical corporation shall be at risk for those costs not
recovered during that time period."  I interpret this to mean that the
utility does not have the option to artificially end the rate freeze
earlier.  However, PG&E may be trying to end the rate freeze early through an
interim valuation of hydro assets.  AB1890 Section 367.a.5 states, "For those
assets subject to valuation, the valuations used for the calculation of the
uneconomic portion of the net book value shall be determined not later than
December 31, 2001, and shall be based on appraisal, sale, or other
divestiture.  The commision's determination of the costs eligible for
recovery and of the valuation of those assets at the time the assets are
exposed to market risk or retired, in a proceeding under Section 455.5, 851,
or otherwise, shall be final, and notwithstanding Section 1708 or any other
provision of law, may not be rescindeded, altered or amended.  PG&E's
original position was an interim valuation could not end the rate freeze when
PG&E had thought it could overcollect CTCs before the run-up in market
prices.  Now PG&E is trying to rewrite history after the fact by using an
interim valuation that is higher than their original estimate.

Per Decision No. 99-10-057, PG&E and SCE were ordered to "file an advice
letter three months prior to the earliest forecasted date that the rate feeze
will end or Sepetmeber 2001 if the rate freeze does not end early....The
Advice Letter implementing rate changes shall become effective within 30 days
of the end of the rate freeze subject to Energy Division determining the
Advice Letter is in compliance." (Ordering Paragraph 1)  To the best of my
knowledge, PG&E has yet to file an advice letter providing 3 months notice of
an end to the rate freeze.  This demonstrates that PG&E is taking desperate
actions.  In that same decision, the CPUC ordered that "PG&E and SCE shall
provide to interested parties estimates of the date the rate freeze will end
and file advice letters to effectuate the end of the rate freeze as set forth
herein." (Ordering Paragraph 2)  To date, every estimate filed with the CPUC
showed that the rate freeze would end no earlier than January 1, 2001.  In
fact, Enron has notified PG&E on prior occasions of the possibility of a
potential earlier end date and PG&E dismissed our concerns about the
misinformation perpetrated by PG&E's filings.  This demonstrates a willful
act on PG&E's part to commit fraud if they were to end the rate freeze before
2001.  This would not be the first time that PG&E has manipulated the
regulatory process.  In its General Rate Case, PG&E was communicating an
expectation of 35 to 40% rate drops at the end of the freeze, which were
later revised to 20% drops.  The effect was to paralyze customers from
choosing an alternate supplier, which turns out was not in the customers best
interest.  Finally, the decision states, "the end of the rate freeze shall
not occur before the generation assets of each utility have been
market-valued except as the law or the Commission determine otherwise."
(Ordering Paragraph 2)  This provision clearly demonstrates that despite all
of PG&E's acts, it will be the final decision of either the Legislature or
Commission as to whether they will allow PG&E to end the rate freeze
retroactively without any advance notice and causing an immediate increase in
utility bills to half of the customers of investor-owned utilities in
California.  If the Legislature or Commission is willing to commit this type
of political suicide, then PG&E's grip on these bodies is tighter than we
could ever imagine.

As opposed to PG&E's desperate plans that would negatively impact California
customers, we willl pursue a win-win strategy.  Amongst various strategies
would be to extend the rate freeze up to December 31, 2004.  A freeze ending
any period between July 1, 2001 and December 31, 2004, will have a positive
impact on our book.  Estimates from a month ago showed a positive impact in
the ballpark of $156 million if the rate freeze were to end on December 31,
2004.  Of course our preference would be to end earlier than 2004 so as to
avoid a potential negative impact on future sales; however, we believe this
PG&E would require at least this time frame in order to mitigate its
undercollections that it would incur for the next few years.  PG&E will
benefit by the opportunity to maximize recovery, especially given an
opportunity to now hedge this risk and with the hedge funded by ratepayers.
ENA will have the opportunity to sell to PG&E.  Customers get a reprieve and
will have an additional four years to prepare for the new market structure,
knowing what they may expect from the scare from this summers.  With a better
informed customer, we may even be able to still sell in California.  The
Governor, Legislature, and Regulators, can defer the concerns to someone
else's term in office.  At a minimum, we should try to negotiate some joint
proposal with PG&E that would extend the rate freeze to December 31, 2001 or
March 31, 2002, with guaranteed recovery of undercollections for PG&E for
some time period beyond those dates.  If adopted by CPUC, PG&E would get the
P&L protection they need and customers can benefit from the reprieve from
higher rates.  I think the key is to preserve the current AB1890 rate freeze
mechanism versus a mechanism similar to that enacted by the Legislature for
SDG&E, because that legislation does not adequately protect all customers and
competitors equally.  The only solution will be a win-win solution.  The Wall
Stree Journal speculates that PG&E will be reluctant to be too aggressive in
selling out customers and may be positioning itself to negotiate a win-win
solution.  We need to make sure we are part of that winning solution, if not
influence that solution.  Moody's Investor Services Inc. issued a negative
outlook on PG&E and PG&E's stock price has dropped $4 from $30 to $26 in the
last week.  Government Affairs is on top of this issue.

Roger


I am trying to update the Facilities Emergency Contact List. I know that much and possibly most of the list is no longer current. Please review for your department and send me any changes that are needed at your earliest convenience. In most cases we were carrying 4 names per group for emergencies. We are going to at least try to get two current contacts. If you know of any groups that may be completely gone, please let me know that also. Please do not make changes directly to the spreadsheet.

Thanks,
Randy


(See attached file: HPLN0210.xls)

 - HPLN0210.xls


Nick:

It looks like Skilling will be able to attend the conference on May 15th.
However, he will need to speak in the morning, because his flight leaves on
the 15th at 3:50 p.m.

Let us know if that will work.

Thanks.


since the siting legislation created only a program that is voluntary and not
in place of the existing laws, and we have a committment from the
legislature, the CEC and the govenor's office to take another shot in
January, as they know that this legislation is flawed, too many conflicting
interests trying to solve a complex problem in too short a time, I feel this
is too harsh...we have already started the process of creating new
legislation, that will be as close to a consensus as possible for next
session..this legislation did not hurt us, and, some companies feel that they
can use the processes.  We have to keep in mind that with the knowledge that
there will be major reorganization legislation next year, we don't want to
offend the friends that we have in Sacramento, particularly the Republicans
who were the ones who insisted on an expedited siting bill


John:  Please call me when you have had a chance to review.  Sara
----- Forwarded by Sara Shackleton/HOU/ECT on 06/27/2000 03:24 PM -----

	"Linda Busk" <Lbusk@hsresources.com>
	06/27/2000 11:33 AM

		 To: <Cstclai@enron.com>, <Sara.shackleton@enron.com>, <Susan.Flynn@enron.com>
		 cc: "Jim Duffy" <Jduffy@hsresources.com>, "Jim Kincaid"
<Jkincaid@hsresources.com>, "Marc Peter" <Mpeter@hsresources.com>, "Pam
Smith" <Pasmith@hsresources.com>, "Theo Gazulis" <Theo@hsresources.com>
		 Subject: Revised Assignments from Jim Piccone

Attached are revised forms of Assignments for both the HSES to Enron (J. Aron
trades) and HS Resources to HSES (Enron trades).  These are redlined versions.

The main changes to the HSES to Enron (J. Aron trades) assignment are
completion of the Effective Date (June 28), the date of the J. Aron/Enron
ISDA and the addition of counterpart and fax signature language.

The HS Resources to HSES assignment has been structurally revised to assign
all HS Resources/Enron trades to HSES except those shown on Appendix A.
Since the HS Resources/Enron trades continue to change every day until the
HSES/Enron ISDA is in place, this new structure of the assignment will be
much simpler and will pick up all HS Resources/Enron transactions through
Friday, June 30.  Hopefully, by then the HSES/Enron ISDA will be in place.

Please let me know as soon as you believe these documents are ready for
Enron's signature.  As soon as I have sign off by the other parties to the
documents, I will advise you.  We can then have everyone print finals, get
signatures and fax all counterparts to me.  I will act as a clearinghouse and
get counterparts back out to everyone.

James M. Piccone
303/296-3600 x414
Fax: 303/296-9709

 - JAron-Enron.doc
 - JAron-Enron.xls
 - HSR-HSESEnronv2.doc
 - HS-HSES-Enron Exceptions.pdf


Hadn't talked with you in a while and thought that I would send a quick note to say hello.  Saying it is busy here sounds a bit like a broken record, but it is busy here!  Big challege currently is juggling our huge day-to-day business for Enron Americas, starting the absorption of some pieces of EES (my part alone looks like an additional 120 employees, with the intent to find ways to assimilate that business and ultimately reduce overall support costs for Enron), the sale of Houston Pipeline to AEP that should conclude in June or July and the commercialization of mid and back office services.    All of these of course with top priority!

I am really enjoying having Beth Apollo on the team.  She has already made  a very positive impact, while she is learning the details of the operations side.

How is life treating you?  I know that their is a lot going on in the London office, as well.  How has Ted Murphy's assimilation into the London office been?  Do you have plans to be in Houston any time soon?

Keep me posted tomorrow on any news that you hear from Mike Jordan regarding their baby.

Hope that all is well with you.  --Sally


Thanks.  I have shared these with Jeff Gossett (gas risk lead) and Scott
Earnest (products risk lead).  I will be curious to hear about the plan that
your DBA's have devised today.  Thanks for you help and attention to these
problems.


INSIDE NYTIMES.COM
The New York Times on the Web, Wednesday, December 13, 2000
______________________________________________________

Dear Member,

With the holidays approaching, we've brought together all
the information you need. In our special Holidays section,
you'll find reviews of holiday films, buying guides from
our technology experts at Circuits to help you find
computers and electronics, our special holiday Book Review
issue, information on travel in the snow or sun, and fun
ways to entertain the kids while they're home on vacation.

Holidays is updated every day with all the holiday-related
information appearing in The New York Times, and it's
available only on the Web.

http://www.nytimes.com/pages/holidays/?1213c

Elsewhere on the site you can send your friends and family
NYTimes.com e-greeting cards featuring holiday photos from
The New York Times Photo Archives, and download a new
holiday screensaver that includes ten photographs from The
Times celebrating the magical season in the city.

http://postcards.nytimes.com/specials/postcards/?1213c

At Abuzz, you can join a discussion of the best places to
find holiday gifts online.

http://nytimes.abuzz.com/interaction/s.124643/discussion/e/1.162

And at WineToday.com, you'll find the "Holiday & Vine Food
and Wine Guide," to help you plan your holiday meals.
Select one of five classic seasonal entrees and let
WineToday.com recommend side dishes, desserts and the
perfect wines to uncork at the table.

http://winetoday.com/holidayvine/?1213c

Finally, please accept our best wishes for the holiday
season by visiting this special online e-greeting card:

http://postcards.nytimes.com/specials/postcards/flash/?1213c

------
MORE NEW FEATURES
------

1. Get insights into the latest Internet trends
2. How dependable is your car?
3. Enjoy salsa music made in New York
4. Remembering John Lennon
5. Explore our exclusive Chechnya photo documentary
6. Bring today's news to your family table

/--------------------advertisement----------------------\

Exclusive Travel Opportunities from Away.com.

Sign up for free travel newsletters from Away.com and
discover the world's most extraordinary travel
destinations. From kayaking in Thailand to a weekend in
Maine, no other site meets our level of expertise or service
for booking a trip. Click to get away with our
Daily Escape newsletter!

http://www.nytimes.com/ads/email/away/index3.html
\-----------------------------------------------------/

------
1. Get insights on the latest Internet trends
------

At the end of a tumultuous year, the latest edition of The
New York Times's E-Commerce section looks at the larger
trends of business and marketing on the Internet. Articles
examine media buying, e-mail marketing, interactive kiosks,
nonprofit recruiting and celebrity endorsements.

http://www.nytimes.com/library/tech/00/12/biztech/technology/?1213c

------
2. How dependable is your car?
------

Has your old clunker survived wind, fog and even windshield
wiper malfunction this winter season? See if your car
ranks among the most reliable according to J.D. Power &
Associates 2000 Vehicle Dependability Study.

http://www.nytimes.com/yr/mo/day/auto/?1213c

------
3. Enjoy salsa music made in New York
------

Our latest Talking Music feature explores the history and
development of salsa. It includes an audio-visual timeline
and audio interviews with two of the music's most popular
artists -- salsa pioneer Johnny Pacheco and contemporary
singer La India.

http://www.nytimes.com/library/music/102400salsa-intro.html?1213c

------
4. Remembering John Lennon
------

New York Times Music critic Allan Kozinn leads an audio
round table discussing the life and work of John Lennon, 20
years after his death, with Jack Douglas, the producer of
"Double Fantasy;" Jon Wiener, author of books on the
Lennon FBI files; and William P. King, editor of
"Beatlefan." Also included in this feature are radio
interviews with Mr. Lennon and Yoko Ono and archival
photographs and articles.

http://www.nytimes.com/library/music/120800lennon-index.html?1213c

------
5. Explore our exclusive Chechnya photo documentary
------

This special photo documentary of the conflict in Chechnya
brings together moving photographs taken by James Hill for
The New York Times and his unique audio diary of the
events.

http://www.nytimes.com/library/photos/?1213c

------
6. Bring today's news to your family's table
------

Conversation Starters, the newest feature of the Learning
Network, helps parents discuss the day's news with their
children. Monday through Friday, Conversation Starters
offers a set of newsworthy and provocative questions as
well as related articles from The Times.

http://www.nytimes.com/learning/parents/conversation/?1213c

Thanks for reading. We hope you'll make a point of visiting
us today and every day.

Sincerely,
Rich Meislin, Editor in Chief
New York Times Digital

P.S. If you have a friend or colleague who might be
interested, feel free to forward this e-mail.

ABOUT THIS E-MAIL
-------------------------------------
Your registration to NYTimes.com included permission to
send you information about new features and services. As a
member of the BBBOnline Privacy Program and the TRUSTe
privacy program, we are committed to protecting your
privacy.

To unsubscribe from future mailings, visit:
http://www.nytimes.com/unsubscribe

To change your e-mail address, please go to our help
center:
http://www.nytimes.com/help

Suggestions and feedback are welcome at
feedback@nytimes.com.
Please do not reply directly to this e-mail.


Today's IssueAlert Sponsors:

[IMAGE]

EXPERIENCE THE PEACE SOFTWARE DIFFERENCE.
DISCOVER THE POWER OF SUCCESS.
Peace Software customers are experiencing real, measurable results using
Peace's advanced customer and commodity suite, EnergyTM.
Discover what the world's leading energy providers already know.

Leading energy providers prefer Peace Software. Find out why...at CIS, Booth
#501.

www.usa.peace.com/CIS2001

[IMAGE]

Vice President Cheney recently stated that to meet projected energy demands
the US requires between 1,300 and 1,900 new power plants.  That averages out
to more than one new plant per week, every week, for 20 years running. Learn
about the pivotal role of natural-gas  based generation in solving the US
energy crisis, attend Natural Gas and Power Generation Strategies 2001, June
13-15,Tucson, AZ.

Miss last week? Catch up on the latest deregulation, competition and
restructuring developments in the energy industry with SCIENTECH's
IssuesWatch

[IMAGE]

[IMAGE]
May 7, 2001

California Update: Duke Energy Proposes Settlement Deal

By Will McNamara
Director, Electric Industry Analysis

[IMAGE][IMAGE]Duke Energy (NYSE: DUK) approached Calif. Gov. Gray Davis with
a secret deal, now made public, that offered monetary concessions if the
state drops lawsuits and investigations into the company's alleged price
gouging. Duke made the offer in a secret 17-page letter sent in April to Gov.
Davis' office, which the governor confirmed on May 2. Davis' spokesman called
the letter Duke's "wish list," which included having the state call off
investigations of the North Carolina-based generator. Although Gov. Davis has
acknowledged receipt of the proposal, he has not officially accepted or
rejected the offer.

Analysis: Duke's desire to make a settlement with the state of California
stems from an ongoing investigation by FERC that began back in March. At that
time, FERC put 13 California power sellers, including Duke, on notice that
they must either make refunds for certain power sales or provide further
justification for their prices. Duke is considered to be one of four
companies (along with Dynegy, Reliant and Williams) that faces the biggest
potential refunds to the state of California. In fact, Duke reportedly faces
potential refunds of up to $20 million for the power that it has sold to
California since the start of this year.

We can fast forward from FERC's investigation to Duke's "good faith"
settlement offer that now sits before Gov. Gray Davis. The plan sets out
specific action steps for new generation, conservation programs, electric and
gas infrastructure improvements, regional transmission frameworks, and
environmental goals. In addition, Duke has offered an undisclosed settlement
agreement, for which the California government would agree to cease all
ongoing investigations of price manipulation by the company. Duke's
"appropriate payment" is based on fair estimate of the company's alleged
overcharges for power that it sold to the state.

Yet, beyond the spin control surrounding this offer, Duke's proposal amounts
to a mutual back-scratching agreement, with Duke clearly obtaining the
largest benefit. Duke wants the state to drop all pending lawsuits that
allege price gouging and tone down the negative public comments against Duke
made by the governor and others. In return, Duke will refund to the state
some of the money that it allegedly owes and will further assist in helping
the state with its power supply needs. However, under the offer Duke will
admit no wrongdoing. Rather, the company's proposal is being presented as an
altruistic effort to assist in the resolution of California's flawed market.
Neither Duke nor Gov. Davis has disclosed the monetary amount of Duke's
settlement offer, but it is fairly safe to assume that it is only a fraction
of the $20 million that the state wants.

Other specifics within Duke's proposal that are important to note include the
company's "commitment to work with the state to get 680 MW of additional
peaking capacity ready for summer 2002." In addition, Duke has offered to
enter into long-term contracts with the state on "reasonable terms" and also
"attempt to secure other reasonably priced electricity for the state."
Perhaps eliciting the greatest response within the industry is Duke's pledge
to "share the financial pain" of California's troubled market with other
market participants.

Presently, Duke supplies about 5 percent of California's power needs, the
majority of which is based on long-term contracts. This is a significant
point because Duke has argued that its participation in the California market
is not as entrenched in the volatile spot market, in contrast to many of the
other power suppliers under FERC's investigation. The company also owns the
Moss Landing plant, located south of San Jose, Calif., which it is upgrading
with a $500 million investment. Duke has established that the plant should be
able to provide approximately 30 percent of California's new generation in
2002.

While Duke downplays the role that California has played in its profits, the
company's total wholesale profits soared 374 percent to $744 million for
year-end 2000. For the year, Duke's California power plants generated 70
percent more electricity than they did in 1999. In addition, in 2000 the
plants provided 17 million megawatt hours of electricity to the state's power
grid versus 9.5 million the previous year.

Further, in January and February 2001, Duke charged more for power through
"credit premiums," which were levied because of the risk of non-payment
associated with California's financially struggling utilities. Duke claims
that it is still owed about $100 million by the Department of Water
Resources, California's power purchaser.

Duke is not the only company forging settlement contracts with California. On
May 2, Tulsa-based Williams Co. (also one of the top four companies
reportedly owing the most to California) announced that it has agreed to pay
$8 million to the California ISO to end FERC's investigation into whether the
company's plants were kept offline to drive up prices. For several months,
FERC has been investigating Williams regarding the company's alleged shutdown
of two power generation units owned by AES, which reportedly allowed Williams
to sell power from other units at higher prices. The stipulation and consent
agreement reached between Williams and FERC identified no improprieties. In
other words, Williams has made the payment but has admitted to no wrongdoing
or price manipulation. A Williams spokesperson has said that the $8 million
will be deducted from the $252 million that Williams is still owed for power
sales to the California ISO and the California PX.

Much like Duke, Williams has reported stellar profits over the last year. For
year-end 2000, the company reported unaudited income from continuing
operations of $873.2 million, or $1.95 per share on a diluted basis, versus
$178 million, or 40 cents per share on a restated basis, for 1999. In
addition, the company reported 1Q 2001 unaudited results that were more than
double that of 1Q 2000-$378 million, or 78 cents per share, compared with a
restated $139 million, or 31 cents per share.

Moreover, the offers that Williams and Duke are forging with the state of
California are probably only a small portion of what both companies have made
from power sales to the state. However, one benefit of the deals is that they
would keep the parties out of years of expensive litigation. Yet, at least as
of this writing, Gov. Davis remains less than enthused about Duke's offer and
has not eased off from his accusation that Duke (along with the other power
generators) has "bilked millions of dollars from California consumers." In
fact, although the governor has said that he is willing to continue
negotiations with the various power generators, he has also vowed "not to
call off the dogs" in the state and federal investigation of any price
gouging. Toward that end, the state's lieutenant governor has initiated a
class-action suit on behalf of California consumers against Duke and other
power generators accused of price fixing. This legal claim follows similar
suits initiated by the city of San Francisco and lawyers in San Diego. All of
the suits basically claim the same thing, that Duke and four other power
generators engaged in unlawful trading practices-such as shutting down
plants-to drive up market prices in California.

Duke, of course, maintains its innocence and says that the new lawsuit merely
makes the same old claim that the company has repeatedly denied.
Nevertheless, Duke has made a monetary offer to the state of California,
which could be driven merely by the desire to avoid lengthy legal proceedings
or by a concern that some wrongdoing on the company's part could eventually
be determined. The stakes have also been raised with some California
attorneys suggesting that any generators found to have engaged in price
gouging should face civil and criminal penalties, which could include
incarceration for any executive at the company who knowingly allowed the
price manipulation to take place. Consequently, despite Duke's offer and any
other proposals that subsequently come from power generators, it appears that
litigation over the price gouging matter is unavoidable.

An archive list of previous IssueAlerts is available at
www.scientech.com

[IMAGE]
The most comprehensive, up-to-date map of the North American Power System by
RDI/FT Energy is now available from SCIENTECH.
Reach thousands of utility analysts and decision makers every day. Your
company can schedule a sponsorship of IssueAlert by contacting Nancy Spring
via e-mail or calling (505)244-7613. Advertising opportunities are also
available on our website.
SCIENTECH is pleased to provide you with your free,  daily IssueAlert. Let us
know if we can help you with  in-depth analyses or any other SCIENTECH
information  products. If you would like to refer a colleague to receive our
free,  daily IssueAlerts, please reply to this email and include  their full
name and email address or register directly on our site.

If you no longer wish to receive this daily email, send a message to
IssueAlert, and include the word "delete" in the subject line.
SCIENTECH's IssueAlerts(SM) are compiled based on the  independent analysis
of SCIENTECH consultants. The opinions expressed in  SCIENTECH's IssueAlerts
are not intended to predict financial performance  of companies discussed, or
to be the basis for investment decisions of any  kind. SCIENTECH's sole
purpose in publishing its IssueAlerts is to offer  an independent perspective
regarding the key events occurring in the  energy industry, based on its
long-standing reputation as an expert on  energy issues.

Copyright 2001. SCIENTECH, Inc. All rights  reserved.


I changed all the volumes to 0 on this deal now that I have a good picture of
what took place.  Please make sure you have 0 pathed on these deals for the
1st through the 4th.

thanks
---------------------- Forwarded by Chris Germany/HOU/ECT on 01/10/2001 04:13
PM ---------------------------

Chris Germany
01/09/2001 01:22 PM
To: Alvin Thompson/Corp/Enron@Enron
cc:
Subject: New Power bookouts

Please bookout deal 563831 with deal 563837.


Dave,

The price file is located in :

O:/Industrial Markets/Fundamentals/Paper/Pulp/RISI Prices

Open this file as read only. The prices are in the first tab

Monika


mark

thanks for this!

i'll give it some thought...and if we ever receive something in writing from
ken raisler, i'd welcome a copy

thanks

j

 -----Original Message-----
From:  Taylor, Mark
Sent: 31 May 2001 17:58
To: Boyd, Justin
Subject: Limit Order Brochure & Help Text for Review

----- Forwarded by Mark Taylor/HOU/ECT on 05/31/2001 11:57 AM -----

	Mark Taylor 05/24/2001 03:02 PM 	   To: raislerk@sullcrom.com  cc:   Subject:
Limit Order Brochure & Help Text for Review

Here is the first draft from the EnronOnline folks.
----- Forwarded by Mark Taylor/HOU/ECT on 05/24/2001 03:01 PM -----

	Erica Bess/ENRON@enronXgate 05/24/2001 02:40 PM 	   To: Mark
Taylor/HOU/ECT@ECT  cc: Kal Shah/ENRON@enronXgate  Subject: Brochure & Help
Text for Review

Mark -

The attached files contain the text to be reviewed. The Limit Order Brochure
Text is for the printed piece that will be mailed to EnronOnline users; the
Online Help is accessed from the Submission window, during the transaction
process.

Regards,
Erica

 << File: Limit Order Brochure Text.doc >>
 << File: Online Help 052401.doc >>


-----Original Message-----
From: 	Barnes, Lynnette
Sent:	Tuesday, August 21, 2001 1:04 PM
To:	Steffes, James D.
Subject:	California Decision

Jim,
	Is this the decision you are looking for?

713-853-9287
888-703-0309


Please just have them create  me as Cara Freeland, new name.

:)

 -----Original Message-----
From: 	Purcell, Mike
Sent:	Friday, February 01, 2002 1:00 PM
To:	Cox, Paige
Cc:	May, Tom; O'Neil, Murray P.; Semperger, Cara
Subject:	Parrellel login requests

Paige,

Per Tom May, Please give the following people parallel login's for scheduling on Tuesday for the Portland  West Desk.

UBS
Cara Semperger
Donald Robinson
Diane Cutsforth

Estate
Mike Purcell
Serena Bishop
Murray O'Neil
Les Rawson

Thank you,

Mike P. Purcell
Settlements Coordinator/ Estate NW Scheduling

503-464-8297


Hey there!

Here's my personal e-mail address...work is barbara.waldrop@cox.com.

Thanks for the so called e-mail yesterday! Ha!  Actually, I will check again
when I get to work this morning.

Anyway, hope you got all your songs downloaded last night and got a good
nights sleep.  No more cramps for me last night.  I was very excited.

Have a great day at work and I will talk with you a little later!  Also, I
will find out what the definite plans are for Saturday night.  Like I said
last night, the whole little birthday party may never come around.  We may
have to be creative on our own!


Has anything similar to the following ever been completed by Paul Waine or
anyone else in CRM (London or Houston)?  Where canI find similar risk
controls studies or questionnaires (hard copy or electronic) for AA or others
(ie. SFA, SEC for ECT Securities)?
---------------------- Forwarded by Steve W Young/LON/ECT on 13/01/2000 11:22
---------------------------

Michael Dugdale
09/01/2000 15:11
To: Michael R Brown/LON/ECT@ECT, Christopher McKey/FRA/ECT@ECT, Philippe
Petit/LON/ECT@ECT, Anna Rafalska/WAR/ECT@ECT, Steve W Young/LON/ECT@ECT, Eric
Shaw/LON/ECT@ECT
cc: murray.harrington@uk.arthuranderson.com, Sarah Williams/LON/ECT@ECT

Subject: Remote office BRM-#2

I would be grateful if you could give this your prompt attention and copy
Murray Harrington who is leading the review by AA with your responses.
Once we have received your input Murray will be contacting you to discuss
your response
If you have any questions do not hesitate to call Murray (0207 3041751) ,
myself or Sarah
Kind regards
Mike

As part of the Business Risk Management Process (BRM) we will be reviewing
the processes for setting up and managing the remote offices.
This review will be conducted by Arthur Andersen who will be reporting to me
directly.

The review requires input from many areas of the business which have been
identified in the attached chart. I would be grateful if you could complete
the sections of the questionnaire that have been identified as  relevant to
yourself.

To complete the questionnaire you are required to provide an answer to each
question raised  by marking one of the evaluation boxes  and providing any
comments that you feel are relevant.

If you are able to complete  other sections of the questionnaire , please
feel free to do so as the more input we receive the better . Similarly
please add any additional comments or suggestions concerning the setting up
or management of remote offices  not covered in the questionnaire.

The questionnaire should be returned by 20 December to  Sarah Williams of AA
with a copy to myself

If you have any questions do not hesitate to call myself or Sarah

Many thanks for your co-operation.

Mike
x 37635