Don't know if you get TEXAS MONTHLY but this story is in the November Issue....
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."


Zimin,

This is the course description I got from Hal.    Can you follow up with him
to schedule a date for a high level presentation?    I think we should keep
it to only 90 minutes or so.    Maybe you and Kevin Kindall can be the
presenters.

--Stinson

---------------------- Forwarded by Stinson Gibner/HOU/ECT on 04/11/2000
04:12 PM ---------------------------

Harold Bertram
04/11/2000 08:38 AM
To: Stinson Gibner/HOU/ECT@ECT
cc:
Subject: Re: Monte Carlo Techniques

Stinson,I feel I would benefit from understanding the Monte Carlo techniques
and what it applies to,as well as when it is used these MC techniques.I think
I could get several people interested.Thanks,Hal

Stinson Gibner
04/10/2000 09:40 AM
To: Harold Bertram/HOU/ECT@ECT
cc:
Subject: Monte Carlo Techniques

Hal,

Actually, I am no longer scheduled to speak at the Risk conference on M-C
techniques.   We could probably put together an internal training for you if
you want.   I'll bring this up with Vince at our staff meeting tomorrow.
It would be helpful if you can describe for me the intended audience and the
types of applications that would interest them.

thanks ,

--Stinson


7 Sis is averaging 23,000 M/Day.  Big Cowboy is pretty dead on.  Carol would
like for us to gross up for Saxet based on the number of flow days left so
that the nomination to the plant takes the payback into account.

Mary


Margaret, what is involved with this Permanent Residency application?  How
does it change my status as a non-immigrant resident?

Regards
Delainey
---------------------- Forwarded by David W Delainey/HOU/ECT on 08/09/2000
03:57 PM ---------------------------

Margaret Daffin
08/09/2000 03:16 PM
To: David W Delainey/HOU/ECT@ECT
cc: Jane Allen/HOU/ECT
Subject: L1 Visa Extension

Dave:  Further to our conversation today, I checked with our immigration
attorneys, and they confirm that the maximum extension for an L1 visa is two
years at a time.

However, they did suggest that you might like to consider a Permanent
Residency application for a Multi-national Executive.  If you would like to
pursue this avenue, please let me know and we can proceed.

If you have any further questions, please call me at x55083.

Margaret Daffin


Stella,
It is very important  that King Ranch is accurately scheduled in the
system.   Sitara should be updated
with any changes so that Daren can properly manage the Texas Desk position.
Hopefully we have moved
enough off of your desk to allow  you to concentrate on King Ranch.  Too many
discrepancies have been made
and it is very costly to the desk.    Robert can assist if needed.
Thanks,    Pat


What is your view on having joint calculation agents?  AIG wants to have both
Enron and AIG act jointly.  Seems to me that this would result in more
potential conflicts in the long run.


Start Date: 4/27/01; HourAhead hour: 18;  No ancillary schedules awarded.  No
variances detected.

    LOG MESSAGES:

PARSING FILE -->> O:\Portland\WestDesk\California Scheduling\ISO Final
Schedules\2001042718.txt


don't have that.

	Mingcheng Lian
	05/23/2001 01:49 PM

		 To: Jeff Dasovich/NA/Enron@Enron
		 cc:
		 Subject: RE: Sempra map

Jeff,

Our developer wants a map shows Sempra's Mexican pipeline.  Can we get it
from you?  Sorry for so many requests.

thanks,

Ming
---------------------- Forwarded by Mingcheng Lian/AP/Enron on 05/23/2001
01:46 PM ---------------------------
From: Kurt Lindahl/ENRON@enronXgate on 05/23/2001 01:38 PM
To: Mingcheng Lian/AP/Enron@Enron, Michael
McGarry/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc: George Thomas/ENRON@enronXgate, Courtney Campbell/ENRON@enronXgate

Subject: RE: Sempra map

Ming,

Thanks for the map.  What we really need is a map that shows Sempra's Mexican
pipeline.

Kurt

 -----Original Message-----
From:  Lian, Mingcheng
Sent: Wednesday, May 23, 2001 8:42 AM
To: McGarry, Michael; Lindahl, Kurt
Cc: Thomas, George; Campbell, Courtney
Subject: Re: Sempra map

Mike,

I got this Sempra map from our SF office.  Hope it is useful to you.

cheers,

Ming
---------------------- Forwarded by Mingcheng Lian/AP/Enron on 05/23/2001
08:33 AM ---------------------------
From: Jeff Dasovich on 05/22/2001 08:50 PM
Sent by: Jeff Dasovich
To: Mingcheng Lian/AP/Enron@Enron
cc:

Subject: Re: Sempra map   << OLE Object: StdOleLink >>

Here's a map.

 - ld2d-#69334-1.DOC << File: ld2d-#69334-1.DOC >>

Best,
Jeff


----- Forwarded by Steven J Kean/NA/Enron on 12/04/2000 09:12 AM -----

	Linda Robertson
	12/01/2000 04:39 PM

		 To: Steven J Kean/NA/Enron@Enron, Richard Shapiro/NA/Enron@Enron
		 cc:
		 Subject: Draft of Bush Transition Team Memo to Steve Kean

Steve,   As we just discussed, this is the transition memo suggesting that
you place a call to Clay Johnson.   As noted in the memo, we are still
working through with the lawyers what leave status our employees would be
required to take while serving on the private transition and the publicly
funded transition.  The answer to this question may determine their
willingness to serve, in some cases.


Ladies and Gentlemen:

Set forth below for your information and review are the expenditures with
Minority/Women Owned Business Enterprises through September 30, 2000.
Should you have any questions, please contact me at x69500.

Calvin Eakins
Director, Minority & Women Business Development
Enron Global Strategic Sourcing
calvin.eakins@enron.com
713/646-9500


Dear Colleagues,

The draft website is ready to go public. It has been linked to the gspp
website. It is still the same address:
http://gspp.berkeley.edu/events/electricity_summit_conference.htm.

Talk to you all soon.
Best wishes,
Heather


The M: drive is currently down Houston is aware of the problem and working to resolve it.  Right now there is no ETA on when it will be fixed.  We will keep you updated as soon as we get any information.

Thanks,

Diana


The attached documents has step by step details on how to manage power curves. IT is in the process of creating another document which will explain about all the other features in the system.


Hi Boys,
?
I REALLY need your lists asap.? Will you  oblige soon?? LU-M


The only thing I'd like to add is the Quantum purchase for November is 1,000 Mcf not MMBtu.  We are showing a 967 btu factor so it would be 967 MMBtu at the wellhead less fuel.

Any additional gas would be under imbalance between Crestone and Quantum.

Thanks.
Theresa

 -----Original Message-----
From: 	Schlecht, Dinah
Sent:	Thursday, November 01, 2001 10:31 AM
To:	Sitter, Scott; Serrano, Walt
Cc:	Staab, Theresa
Subject:	OBA Imbalance Sheet

Scott & Walt:

A couple of things...I talked to Theresa today and the OBA Spreadsheet (or actually,  Enron's imbalance sheet) needs to be changed for both October and November as follows:

October:

ENA purchased 300 mmbtu/d from Westport  at the Bear Paw point beginning October 9.  We need to add a column on the ENA sheet (i.e. similar to Phillips) showing that 300 mmbtu.
Quantum - ENA did not purchase any gas from Quantum for October.  We had some measurement of gas from Quantum throughout the month.  This needs to go to imbalance between Quantum and Crestone.

November:

ENA is purchasing 1,000 mmbtu/d from Quantum.  If Quantum produces more than 1,000 mmbtu/d that extra goes to imbalance between Quantum and Crestone.
ENA is not purchasing Westport's gas at this time.

I would be happy to make these changes, but I am unsure as to how this file affects your Meter Allocation report and I don't want to mess that one up!!!

I'm copying Theresa on this memo....please feel free to add to it if I missed something.

Thanks.

Dinah L. Schlecht
Sr. Market Services Rep.
Bear Paw Energy
720-946-3694 (work)
720-530-7758 (cell)


This message is to inform you that you have Airfare credit slip available to pick up at the desk of Leticia Flores ECN2733A.  Pickup times are 8:30 am to 4:30 pm Monday - Friday.

I understand that you may not be in Houston or in the Enron Buildings,  please just email me with an address that we can send your credit slips to.  If you are in the downtown buildings, we will not interoffice mail these.  Please pick up at your earliest convenience.

Thank you
Corporate Travel

Johnny Ross
713-345-3640


The Approval status has changed on the following report:

Status last changed by: Mark A. Frevert
Expense Report Name: MEH 11.07.01
Report Total: $1,760.98
Amount Due Employee: $1,760.98
Amount Approved: $1,760.98
Amount Paid: $0.00
Approval Status: Approved
Payment Status: Pending

To review this expense report, click on the following link for Concur Expense.
http://expensexms.enron.com


Mark-

Thanks for your prompt response.  I know you must be swamped, as usual.  As
you are likely to be handling the final review of the ISDA documentation that
has been produced for use in Japan, I am also forwarding the credit
worksheets that have been produced for the three potential Japanese
counterparties (Mitsui,Sanwa and IBJ).  The credit worksheets were produced
by John Suttle.  I note, that following correspondence between Jonathan
Whitehead and John Suttle, it has been agreed the Mitsui MAC can be BBB+.

Please inform me of anything further that I may undertake, to help to
expedite the process.

Best regards,

John

	Mark Taylor@ECT
	08/16/2000 08:44 PM

		 To: John Viverito/Corp/Enron@ENRON, Brent Hendry/NA/Enron@Enron
		 cc: Alan Aronowitz/HOU/ECT@ECT, Jonathan Whitehead/AP/Enron@Enron
		 Subject: Re: Weather Derivative GTC's with Enron Japan Corp. as Counterparty

John:  Thanks for your note.  Brent Hendry is now our primary weather
derivatives lawyer and I am forwarding this to him.

	John Viverito@ENRON
	08/16/2000 04:53 AM

		 To: Mark Taylor/HOU/ECT@ECT
		 cc: Alan Aronowitz/HOU/ECT@ECT, Jonathan Whitehead/AP/Enron@Enron
		 Subject: Weather Derivative GTC's with Enron Japan Corp. as Counterparty

Hi Mark-

Attached are the GTC's discussed in my preceding e-mail.

Best regards,

John
----- Forwarded by John Viverito/Corp/Enron on 08/16/2000 04:52 AM -----

	John Viverito
	08/15/2000 01:20 AM

		 To: Alan Aronowitz/HOU/ECT@ECT, David
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 cc: Jonathan Whitehead/AP/Enron@Enron, Joseph P Hirl/AP/ENRON@ENRON
		 Subject: Weather Derivative GTC's with Enron Japan Corp. as Counterparty

Alan/David-

Attached hereto, are the GTC's with Enron Japan Corp. as counterparty for EOL
trading of Japanese weather derivative HDD swaps.  The US GTC's were utilized
as the basis of the documentation.  The GTC's have been tailored to the
Japanese market in conjunction with Baker & McKenzie, Tokyo.

Please review and provide comments prior to loading onto the EOL system.  I
note that September 1, 2000 is the date on which trading on this basis is
expected to begin.

Cheers,

John


-----Original Message-----
From: Jennifer Reitmeyer [mailto:jennsreit@houston.rr.com]
Sent: Sunday, September 30, 2001 8:51 PM
To: Suzane; Mrs. Henninger; Jay; faithbeliever; Aaron Henninger
Subject: FW: George W.

-----Original Message-----
From: Jennifer Reitmeyer [mailto:jennsreit@houston.rr.com]
Sent: Saturday, September 29, 2001 11:26 PM
To: Jamie Grayson
Subject: George W.

This was sent to me.  I don't know who wrote it but it is good!

Subject: George W.

 This was the same man who came within a hair's breadth of losing an
election in
November, who withstood the political chicanery of the Florida Democratic
machine to fix the vote count.
 This was the same man who admitted to having a drinking problem in younger
years, and whose happy-go-lucky lifestyle led him to mediocre grades in
college
and an ill-fated oil venture.
 This was the same man who mangled syntax even more than his father, and
whose
speaking missteps became known as "Bushisms." And on Friday, this was the
man
who bore the weight of the world and the responsibilities of a generation
with
dignity, class, confidence, appropriate solemnity,
 and even much-needed wit.
 One thing struck me during the campaign, that difficult,
 roller-coaster campaign that now seems years ago. It was that George W.
Bush
never seemed to get ruffled. Whether the theft of a campaign debate video or
the
sudden (some would say, vicious) release of a DUI arrest two decades ago at
 a key moment, "W" did not lose his cool. At times, his staff seemed
overconfident, as did many of us. A 350-electoral-vote win, they quietly
implied
and we optimistically believed. Then they counted the votes, miscounted
others,
and re-counted still others. At the end, he was still there.
 Whereas Al Gore almost frantically huffed and puffed, trying to gin up
something out of nothing, Bush quietly but confidently waited at his ranch.
He
did nothing:  that is the mistake people have constantly made with this man,
confusing lack of bluster for absence of action. No, his team of attorneys
and
the iron-willed James Baker were carrying out his orders, but W
 stayed in the background, confident and faithful.
 You see, it is this faith business that confounded everyone. We  have had
such
actors and liars in public office that we have looked skeptically whenever
anyone used the term faith.
 But this was the same man who was the first politician ever in
 recent memory to name Jesus Christ as the lord of his life on public TV.
 Not an oblique reference to being "born-again" or having a "life change."
 He said the un-PC-like phrase, "Jesus Christ," to which his handlers and
advisors, no doubt, off stage, were also saying, "Jesus Christ" in a much
different tone.
 God has a way of honoring those who honor him. David learned  that while he
was
on the run from Saul's armies. Job learned that after his time of horrible
tribulation. The Messiah said so Himself, many times. So this was the man
who
actually put faith into practice. He actually loves those who hate him. It
is a
staggering concept, so foreign in daily occurrence
 that few thought it anything but grandstanding. Even one of W's biggest
supporters chided the president for adhering to his "new tone."
 Yet there he was, again and again, thanking the Democrats.
 Appointing his enemies to high places in his government. Inviting his
former
foes and their wives to private movie screenings, and (I know, this is  hard
to
stomach) even treating them with dignity. See, this was the man who
 learned early on how faith worked: by praying for his enemies, you "heap
burning coals upon their heads." Happen to catch

Bill Clinton at the National Prayer Service?  Didn't look too good, did he?

 This was the man who named the absolute top people in national  security
and
defense, then caught barbs from the politically righteous  that this one
didn't
have the right views on abortion or that one didn't  have the right position
on
guns.
 And on September 11, at midmorning, this was the man thrust into a position
only known by Roosevelt, Churchill, Lincoln, and
 Washington. The weight of the world was on his shoulders, and the
responsibility of a generation was on his soul.
 So this same man---the one that the media repeatedly attempted to tarnish
with
charges of "illegitimacy," and the one whose political opponents desperately
sought to stonewall until mid-term elections--- walked to his seat at the
front
of the National Cathedral just three days after the two most impressive
symbols
of American capitalism and
 prosperity virtually evaporated, along with, perhaps, thousands of
Americans.
 As he sat down next to his wife, immediately I knew that even if  his faith
ever faltered, hers didn't. I have never seen a more
 peaceful  face than Laura Bush, whose eyes seemed as though they were
already
gazing at the final outcome . . . not just of this conflict, but of  her
reward
in
 Heaven itself. In this marriage, you indeed got two for the price of  one.
 The appropriate songs were sung, as one said, to in an almost
 unbearably emotional service. I, for one, broke down innumerable  times
merely  listening on tape delay on the radio. How the man spoke without
blubbering,
I'll never know.
 Then came the defining moment of our generation. Some people  fondly recall
their Woodstock days. Others mark with grim sadness  November 22, 1963, as
the
day America lost her innocence. But I firmly believe when the history of
this
time is written, it will be acknowledged by  friend  and foe alike that
President George W. Bush came of age in that  cathedral
 and lifted a nation off its knees. It wasn't so much his words,
 though read a  decade later, they will indeed be as stirring as any. The
conflict  would  end, he noted, "at a time of our choosing." It certainly
wasn't
his emotion.
 What had to have been one of the most stunning exhibitions of  self-control
in
presidential history, W was able to deliver his
 remarks without  losing either his resolve or his focus, or, more
important,
his  confidence.
 It was as if God's hand, which had guided him through that
 sliver-thin  election, now rested fully on him. His quiet confidence let
our
enemies know . . . and believe me, they know . . . that they made a grave
miscalculation.
  Now, this same man who practiced his faith through a tough
 election, who steeled his convictions even more in a drawn-out  Florida
battle,
and  who never once gave in to the temptation to get in the gutter with  his
foes (well, OK, maybe the "Clymer" comment is an exception), this  same
 man now lifted the weight of the world and the responsibility of a
generation
and put it on his modest shoulders as though it were  another unpleasant
duty.
 As he walked back to his seat, the camera angle was appropriate.
 He was virtually alone in the scene, alone in that massive place of  God,
just
him and the Lord. But that's the way it's always been in his  life
recently. In
that brief time it took him to return to his seat, I  believe he  heard
words to
the effect of, "You can do this, George. I am with  you always.
 And you can do this well, because I am going before you. And don't  worry
about the weight. I've got it." And I saw in his eyes a quiet
acknowledgment.
 "I know.  Thank you, Lord."
  Back at his seat, when W sat down, George H. W. Bush reached  over and
took
his son's hand. The elder Bush always struck me as a  religious  man, but
not
someone who shared his life on a daily basis with the  Lord.
 George H. W.  treats the Father like a respected uncle, visiting him  on
appropriate holidays and knowing the relationship is real, but not
constant.
 Anyway, I believe that in that fatherly squeeze George H. W. said,  "I wish
I
could do this for you, son, but I can't. You have to do this on your  own."
W
squeezed  back and gave him that look of peace that Laura had kept
throughout.
 It said, "I don't have to do it alone, dad. I've got help."


Cinergy has just emailed today a proposed settlement which has to be filed by Friday - a very short window of time.  I will be reviewing it in the next hour so I can't yet give you a summary.
Please review and let me know your thoughts.

Jeff, This doc. is drafted by Cinergy.  I am wondering whether we can leverage our signature - assuming we are basically ok with the doc. to a commitment to talk about the imbalance issues.  I don't think we have leverage to force a conclusion on the imbalance issue unless I can get other parties on board.  Facing a friday deadline, we will have to move fast.

Janine
 -----Original Message-----
From: 	"Brothers, Ron" <Ron.Brothers@Cinergy.COM>@ENRON
Sent:	Tuesday, November 06, 2001 6:28 AM
To:	rmork@ucclan.state.in.us; jlyle@mullettlaw.com; tstewart@lewis-kappes.com; jmigden@Enron.com
Cc:	rheidorn@vectren.com; bhouse@ipalco.com; zhmglaw@psci.net; donm@wvpa.com; critz@parrlaw.com; mbreece@impa.com; mcracraft@hhclaw.com; LSpence@midwestiso.org; SKozey@midwestiso.org
Subject:	Indiana Midwest ISO Joint Petitioners - IURC Cause Nos. 42027 and 42032 - Proposed Settlement Agreement

Attached below is my draft of a proposed Settlement Agreement prepared
on behalf of the Midwest ISO Joint Petitioners in the consolidated
proceeding on IURC Cause Nos. 42027 and 42032.

My draft also reflects the comments of IMPA and the Midwest ISO.

I have not and will not circulate my draft to NIPSCO or I&M.  Since they
will not be a party to the Settlement Agreement, I do not believe that
they need to see my draft.

To facilitate execution (if we reach agreement), I have included 10
separate entity specific signature pages.

Under my draft, the Midwest ISO Joint Petitioners would request IURC
permission to withdraw their participation in the Joint Motion To Strike
Prefiled Testimony Of Intervenor Enron.

My draft attempts to include all of the commitments made in prefiled
testimony by the Midwest ISO Joint Petitioners and all of the
representations made to the IURC in prefiled testimony by Mr. James P.
Torgerson on behalf of the Midwest ISO.

It is my understanding from the IURC's recent Docket Entry that any
settlement agreement should be filed with the IURC by Friday, November
9.

Please let me know when you would like to meet in person or by
conference call to discuss my draft proposed Settlement Agreement.

 <<IURC JOINT PETITION OF INDIANA MISO TOs - Proposed Settlement - AS
SENT TO THE OUCC ON  NOVEMBER 5.doc>>

Ron Brothers

 - IURC JOINT PETITION OF INDIANA MISO TOs - Proposed Settlement - AS SENT TO THE OUCC ON  NOVEMBER 5.doc


Start Date: 10/27/01; HourAhead hour: 8;  No ancillary schedules awarded.  No variances detected.

    LOG MESSAGES:

PARSING FILE -->> O:\Portland\WestDesk\California Scheduling\ISO Final Schedules\2001102708.txt

Error retrieving HourAhead price data - process continuing...


---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 10/18/2000
12:55 PM ---------------------------

Alex Huang@ENRON
10/17/2000 04:00 PM
To: Vince J Kaminski/HOU/ECT@ECT
cc:
Subject: parameter estimation

Vince,
I have put together a parameter estimation model, which is continuation of
Tanya's model.
The estimation process is more consistent now. Attached are the model and a
brief
write-up of the methods. If you see any problem/ways to improve it, please
let me know.

Best,
Alex


Comments?

---------------------- Forwarded by Eric Thode/Corp/Enron on 08/22/2000 04:55
PM ---------------------------

Eric Thode
08/22/2000 04:52 PM
To: Mark Palmer/Corp/Enron@ENRON, Steven J Kean/HOU/EES@EES, Aleck
Dadson/TOR/ECT@ECT, Robert Hemstock/CAL/ECT@ECT, Richard B
Sanders/HOU/ECT@ECT, Richard Shapiro/HOU/EES@EES
cc:

Subject: Project Stanley Q&As

I haven't heard from anyone yet on the Q&A document related to Project
Stanley.  Any thoughts or comments on the attached?

---------------------- Forwarded by Eric Thode/Corp/Enron on 08/22/2000 04:53
PM ---------------------------

Eric Thode
08/11/2000 04:31 PM
To: Mark Palmer/Corp/Enron@ENRON, Steven J Kean/HOU/EES@EES, Aleck
Dadson/TOR/ECT@ECT, Robert Hemstock/CAL/ECT@ECT, Richard B
Sanders/HOU/ECT@ECT, Richard Shapiro/HOU/EES@EES
cc:

Subject: Project Stanley Q&As

Attached are the 58 questions prepared by GPC in anticipation of a public
release on Project Stanley.  The answers have been compiled by numerous
individuals, including Aleck, Rob, Kevin Wellenius and me.  Please review,
make changes and return to me at your earliest convenience.  I will compile
everyone's corrections, additions, etc. and prepare a revised document.
Thanks.

If you have any questions, call me at ext. 3-9053.

Eric


That was just plain  MEAN.  I'm having a bad enough day...I don't need your
crap too!

Have a good evening.  Talk to ya tomorrow.

RR

Ryan Watt
06/08/2000 07:03 PM
To: Robin Rodrigue/HOU/ECT@ECT
cc:
Subject: Re: How's it looking?

We're off!!!

by 0.70 contracts....talk to you tomorrow!

Robin Rodrigue
06/08/2000 06:00 PM
To: Ryan Watt/CAL/ECT@ECT
cc: Nicole LaPorte/CAL/ECT@ECT

Subject: Re: How's it looking?

Sorry it took so long.

Robin

Ryan Watt
06/08/2000 06:49 PM
To: Robin Rodrigue/HOU/ECT@ECT
cc:
Subject: How's it looking?


Stephanie,

Transwestern has been in discussions with ENA since very early December regarding the sale of the Enron Compression Services gas. The ECS off take is supposed to be 11,000 per day. The fact that ECS was not able to nominate their gas has been problematic for Transwestern in that it causes our line pack to be higher than it otherwise would be. When we began discussions, we were open to the idea of getting the full volume out of our system by the end of the month. If a nomination could have been made that resulted in a sale starting at the beginning of this week, ECS could have sold the entire 363,000 in December. At some point, it becomes unrealistic to expect to be able to do that. It has taken ECS so long to arrange for an agent that a now we are looking at selling the entire volume in just 12 days (~30,000/day).

I was expecting the following two things from ENA, 1) confirmation from you that ECS was set up to sell their gas, and 2) a start date for a sale with some advanced notice. I would then have conferred with operations to see if it would be possible to move the entire 363,000 in December. I did not expect ENA to arrange the sale before circling back with TW. If I had known that you were about to close a sale, I could have arranged to be pulled out of my meetings Tuesday afternoon.

I have advised Patti Sullivan that TW is able to deliver 25,000/d through the end of the month. The balance can be delivered in January.

I am confident that things will run smoother in the future.

Regards,

Paul

-----Original Message-----
From: Miller, Stephanie
Sent: Tuesday, December 18, 2001 8:24 PM
To: Y'barbo, Paul
Cc: Tholt, Jane M.; Boyt, Eric; Nemec, Gerald; Gay, Randall L.
Subject: TWPL Imbalance

Greetings Paul:

Eric Boyt advised that TWPL was not in a position to deliver the full volume of approx. 363,000 mmbtu for the remainder of the month for the account of Enron Compression Services.  This would have been good information to know BEFORE we sold the gas.  I left a couple of messages today but never heard from you.  Unfortunately, we have sold this volume, at your repeated request, and are not in a position to retrade the deal.

To the extent TWPL is unable to perform, please call Janie Tholt or Randy Gay to see if they can reduce the commited volume.

I am scheduled to be out tomorrow but may have to come in for the afternoon.

Please advise ASAP.

Ragards,

Stephanie
x31688


Mark and Leslie,

Dave had mentioned that Mark had some reservations about using prize winners'
names.

Could you please confirm weather we can or can not legally use prize winner
names for promotional purposes and your rational for not wanting to disclose
the winners.

Cheers

Victor


Last month all of your donations helped Enron raise a grand total of $6 million for the United Way, including our corporate match.  Once again Enron employees made a difference and contributed more than any other pacesetter company in Houston. Also, congratulations to Elaine Brown with Enron Global Markets who won the drawing for two round-trip airline tickets for participating in this year's campaign.  Thanks to everyone at Enron for your generosity!

This week Enron and the United Way of the Texas Gulf Coast have entered in to yet another exciting partnership. Beginning with the Astros vs Giants game on Tuesday, October 2, one of Enron's primary signs at Enron Field will feature the United Way logo alongside the Enron logo.

The decision to include United Way's logo on the sign marks the first time in history that a naming rights partner is sharing exposure on one of its primary in-stadium signage locations with a non-profit partner.  This sign is also a free, innovative way to demonstrate Enron's support of the United Way and promote the agency's role in our community.

The millions of fans who attend Astros games each season will see the sign.  Be sure to look for this history-making sign hanging high above the outfield.


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Lucy, Scott Neal and I ( we run the East Gas business together) are likely to need a new assistant when and if this deal goes forward.  I have not checked with anyone and I don't want to mis-lead you but would like to know IF you would be interested if things move forward.

Frank


Legal,

Per the request of Stewart Rosman, please prepare an ISDA between Public Utility District Number One of Grays Harbor and ENA.  Credit concerns should be addressed to Tracy Ngo or myself.

Thank you,

Susan


I called time warner and basically we were on a 6 month trial package of hbo and showtime for 9.95.  After 6 months, the rate goes to 12.95 - they charged us for hbo, showtime, and cinemax which should be 16.95 but they overcharged us in addition to the fact that we don't currently get cinemax.  I went ahead and ordered the 3 channel package (with cinemax) and they are crediting us for 19.95 for the overcharge.  Going forward the package will be 16.95 or we can cancel cinemax and save 4.00 a month.


Steve, Maureen -

A copy of the itinerary for you.


I have removed the pricing from that ticket.

 -----Original Message-----
From: 	Ellis, Laurie
Sent:	Tuesday, March 19, 2002 3:18 PM
To:	Parks, Joe
Subject:	Deal 1195913

Joe, please let me know when you change the price on this deal for Feb-02 so that we can correct our outstanding receivable balance.

Thanks,
Laurie Ellis
Specialist - Gas Settlements
Enron Net Works LLC
Phone: (713) 345-9945
Fax:  (713) 646-8420
email:  laurie.ellis@enron.com


_________________________________________________________________

WEEKEND SYSTEMS AVAILABILITY

FOR

2/1/2002 5:00:00 PM through 2/4/2002 12:00:00 AM
_________________________________________________________________

Impact:   Corp
Time:   Sat 2/2/2002 5:30:00 PM CT thru Sat 2/2/2002 7:30:00 PM CT
	Sat 2/2/2002 3:30:00 PM PT thru Sat 2/2/2002 5:30:00 PM PT
	Sat 2/2/2002 11:30:00 PM London thru Sun 2/3/2002 1:30:00 AM London
Outage:   Maintenance of NAHOU-SQUFY04S & 05S
Environments Impacted:   Estate Unify Production.
Purpose:   Preventive maintenance on two cluster member servers.
Backout:   None
Contact(s):   Skinner, Tony  713-345-9334
	Jordan, Mark  713-286-5308
	Warner, John  713-345-1756

Impact:   EES
Time:   Fri 2/1/2002 3:00:00 PM CT thru Fri 2/1/2002 11:00:00 PM CT
	Fri 2/1/2002 1:00:00 PM PT thru Fri 2/1/2002 9:00:00 PM PT
	Fri 2/1/2002 9:00:00 PM London thru Sat 2/2/2002 5:00:00 AM London
Outage:   Upgrade EESHOU-DBRGS from NT 40 to W2K server
Environments Impacted:   SQL database
Purpose:   Server needs to be upgraded to windows 2000 and SQL 2000 to meet corp standards
Backout:   Restore original configuration from tape backup
Contact(s):   Nguyen, James  713-345-6137

Impact:   Corp
Time:   Thur 1/31/2002 5:00:00 PM CT thru Fri 2/1/2002 7:00:00 AM CT
	Thur 1/31/2002 3:00:00 PM PT thru Fri 2/1/2002 5:00:00 AM PT
	Thur 1/31/2002 11:00:00 PM London thru Fri 2/1/2002 1:00:00 PM London
Outage:   Replace disk on Envision
Environments Impacted:   Corporate-wide applications accessing the Envision web query, FileNet Panagon IDM Desktop, FileNet IDM for R3, Panagon Capture professional. Users will be able to access IBuyit and IPayit from SAP but will not be able to view invoices.
Purpose:   Maintenance is needed to repair bad disk
Backout:   None
Contact(s):   Vollmer, Mary  713-853-3381
	Rye, Gregory  713-345-3022

Impact:   Corp
Time:   Sat 2/2/2002 6:00:00 AM CT thru Sat 2/2/2002 9:00:00 AM CT
	Sat 2/2/2002 4:00:00 AM PT thru Sat 2/2/2002 7:00:00 AM PT
	Sat 2/2/2002 12:00:00 PM London thru Sat 2/2/2002 3:00:00 PM London
Outage:   Reindex Envision database
Environments Impacted:   Corporate-wide applications accessing the Envision web query, FileNet Panagon IDM Desktop, FileNet IDM for R3, Panagon Capture professional. Users will be able to access IBuyit and IPayit from SAP but will not be able to view invoices.
Purpose:   Maintenance needed to correct performance issues
Backout:   None
Contact(s):   Vollmer, Mary  713-853-3381
	Rye, Gregory  713-345-3022


Derek:  Gail Shanley (Goldman Sachs & Co. in N.Y.) sent me Enron Credit Inc.
documents (with Goldman Sachs & Co.).   Enron Credit Limited will be dealing
with Goldman Sachs International in London.  I'll try to find out who the
London lawyer is and have the docs sent to Denis O'Connell who is the lawyer
for Enron Credit Limited.

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

	Derek Lee@ENRON
	05/30/2001 10:34 AM

		 To: Sara Shackleton/HOU/ECT@ECT
		 cc:
		 Subject: Re: Goldman Sach $ repo docs

Sara,
it is between ECL and GS & Co.  but  GS ;s Gail shandley sent over the docs
to you.


Heather,

I am forwarding this message to 2 groups in Enron that may be interested.

Vince

"Heather Thorne" <hethorne@wharton.upenn.edu> on 04/26/2001 08:55:56 PM
To:	"Christie Patrick" <christie.patrick@enron.com>, "Vince Kaminsky" <vkamins@enron.com>
cc:	"Greg Hunt home" <gregoryhunt@home.com>
Subject:	Recruiting for weather risk management group

Dear Vince and Christie,

I hope that you are both well, and are ready for the onset of summer in Houston!  I was disappointed that I was not able to see you at the final Tiger Team presentations last month due to a family emergency.  I hope that the teams' analyses will be helpful to your work, and echo their appreciation of your involvement and support.

I am writing with a question regarding recruiting for Enron's weather risk management group.  My boyfriend, Greg Hunt, is currently seeking opportunities to combine his background in meteorology (MS and 2 years of research at Lawrence Livermore Nat'l Lab) and an MBA in finance and information technology.  I began thinking about Enron's work in weather derivatives, and realized that there could possibly be a great fit there.

I have copied Greg on this message, and would appreciate any suggestions you can offer regarding opportunities in this group.  Thank you very much!

Best regards,

Heather

Heather N. Thorne

MBA Candidate, 2001

The Wharton School at University of Pennsylvania

2516 Pine Street

Philadelphia, PA 19103

(215) 545-3022


A quick message in case you hadn't heard.  Thursday afternoon and Friday
morning, legal can be reached at the Woodlands Conference Center at:

281-297-5130 (phone)

281-297-5132 and 5133 (fax)


here's the draft I resent to Bear.  Sara
----- Forwarded by Sara Shackleton/HOU/ECT on 12/27/2000 04:37 PM -----

	Sara Shackleton
	12/27/2000 02:54 PM

		 To: kkopelman@bear.com
		 cc:
		 Subject: Bear Stearns

Please check this latest draft and call me at (713) 853-5620.  Thanks.  Sara

Sara
----- Forwarded by Sara Shackleton/HOU/ECT on 12/27/2000 02:55 PM -----

	Stephanie Panus@ENRON
	12/27/2000 02:47 PM

		 To: Sara Shackleton/HOU/ECT@ECT
		 cc:
		 Subject: Bear Stearns

Attached is the revised forward template for Bear Stearns.


I just spoke to Frank, and spoke to Jeff Blumenthal earlier this week about
tax issues arising out of Amita executing documents on behalf of EOL and
ENA.  Frank just informed me that the Japan office has also been provided
with stamp of Sheri Thomas's signature so they can execute PA's out of
Japan.  Frank and I were thinking we might want to get together sometime next
week to discuss this.


Attached is a memo summarizing where matters stand re Ontario market opening
after the announcement on April 23rd.


Tom, I have left you a voice mail about this issue......please call so that we may discuss .....the Master was amended to add a Independent Amount and the definition used is a formula and the formula is unusual....it seems that subpart (a) is the applicable subpart, but we are unable to verify the numbers provided by Jay.  bng

 -----Original Message-----

 -----Original Message-----
From: 	Gray, Barbara N.
Sent:	Tuesday, February 12, 2002 1:10 PM
To:	Bailey, Susan
Subject:	FW: Letter of Credit  DevX Energy

Susan, Have you done any letter of credit work....please call me thks bng
 -----Original Message-----
From: 	Williams, Jason R (Credit)
Sent:	Tuesday, February 12, 2002 9:47 AM
To:	Gray, Barbara N.
Cc:	Lagrasta, Fred; Moran, Tom; Gonzalez, Veronica
Subject:	Letter of Credit  DevX Energy

Barbara -

Per our earlier conversation, below is the relevant information about the DevX Energy letter of credit:

Letter of Credit
Posted on behalf of DevX Energy.  Beneficiary is Enron North America Corp.  Letter of Credit expires 12/2003.

Trades
DevX Energy has two financial swaps in place with Enron North America Corp.:
	TAGG # EK9320.1        DevX Energy bought fixed-price natural gas
	TAGG # EK9338.1        DevX Energy sold fixed-price natural gas

Both trades run through 12/2003.

Current Exposure
Presently, DevX Energy is out of the money approximately $1,000,000 on these positions.

Commercial Contact
The commercial contact for Enron is Fred Lagrasta (ext. 36529).

Credit Contacts
The credit contacts for this are Tom Moran (ext. 33017) and Veronica Gonzalez (ext 30511).

DevX Energy has asked if the LC can be reduced.  Can you please coordinate with Fred and Tom?

Thanks,

Jay


713 973 6325

Reagan Rorschach
09/20/2000 11:25 AM
To: Kay Mann/Corp/Enron@Enron
cc:

Subject: Your Phone Number

Kay,

What is your phone number?  We will try to call about noon.

Reagan


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Very sweet.  Thank you very much.


Attached is the outline used for Stan's meeting this morning.  You can just update
	information as it is your turn to attend his staff meeting.

	Stan will NOT have a staff meeting next week, December 24th.

	If you have any questions, please let me know.  Thanks. Lynn


Here it is.  The block in the middle summarizes the change in business
situation over the last two years.

Stephen

---------------------- Forwarded by Stephen P Schwarz/HOU/ECT on 02/23/2000
02:34 PM ---------------------------

	Enron North America Corp.

	From:  Stephen P Schwarz                           02/18/2000 04:17 PM

To: Bryce Baxter/HOU/ECT@ECT, Lisa Csikos/HOU/ECT@ECT, Rita
Wynne/HOU/ECT@ECT, Mechelle Stevens/HOU/ECT@ECT, Susan Harrison/HOU/ECT@ECT,
Brenda F Herod/HOU/ECT@ECT, Brent A Price/HOU/ECT@ECT, Melissa K
Ratnala/HOU/ECT@ECT, Leslie Reeves@CCMAIL, Evelyn Aucoin/HOU/ECT@ECT, Laura E
Scott/CAL/ECT@ECT, Cheryl Dawes/CAL/ECT@ECT
cc: Melissa White/HOU/ECT@ECT, Dorothy Ricketts/HOU/ECT@ECT, Kimberly
Perkins/HOU/ECT@ECT, Trang Le/HOU/ECT@ECT, Christy Sweeney/HOU/ECT@ECT
Subject: Unify AR -- SAP Plans

Two years ago Enron North America made a decision to use Unify AR for cash
application rather than SAP AR.  We decided at the time that SAP AR would be
kept in sync with Unify AR by the Unify/SAP interface.  We believe that the
business logic for that decision has changed, and are now recommending that
Unify AR be permanently turned off and all AR functions be performed in SAP.
I have briefly summarized the change in business situation below.

Two Years Ago	Today
Netting allowed by legal and credit ONLY if netting contract was already in
place.	Netting encouraged by legal and credit wherever possible, regardless of
existence of signed agreement.
Netting limited to one counterparty and legal entity at a time.	Canada nets across
counterparties.
Netting performed in physical only, financial settlements to maintain
separate net statement process.	ENA considering netting physical and financial
together.
All account coordinators were to apply their own cash.	Cash applied centrally in
Power, Financial and Canada  Individual coordinators apply cash only in
physical Gas.
Cash was to be applied at the line item level to track variances and to
facilitate calculation of cost of funds by commercial team.	Cash is not being
applied meaningfully at the line item level.  The company has not made any
move towards calculating cost of funds by commercial team.
The Account Inquiry functionality in Unify was thought to be a key on-line
tool.	Old habits die hard...most users appear to be printing reports and reviewing
data, rather than using the on-line functionality.
Overapplication of cash was not to be allowed.  Overpayments would be
classified as "on account", with issues tracked in a case management system.	Case
management system does not exist.  Allowing overapplication helps the account
coordinators track overpayments easier than leaving cash on account.
The counterparty/legal entity combination on the deposit needed to match the
counterparty/legal entity combination on the Enron invoice.	Given the number of legal
entities Enron has, along with the number of entities our counterparties
have, this seems like a hopeless battle.  Allowing cross-application of cash
seems easier.
Corp required that intercompany settlements had to be "settled" with cash
movement.	Corp no longer requires intercompany settlements to be "settled" with cash
movement.

Converting to SAP AR simplifies the Unify/SAP interface in the following ways:
Bank deposits into SAP do not have to be split off into Unify
Cash entries in Unify do not have to be interfaced back to SAP
Unify netting entries do not have to be interfaced to SAP
Payables information does not have to be interfaced from SAP to Unify

Given the change in attitudes towards our netting business process we face
two problems in Unify.
Controls built into Unify are already obsolete.
Unify does not maintain all products in one database, making efforts to net
across products in the future (physical with financial, for instance)
impossible.

Our understanding of the netting process in SAP indicates that there are no
controls (which sounds good at this point) and that we would retain the
automatic netting entries when the payable is netted with the receivable
within SAP.  However, we emphasize that netting would be done in SAP, not at
the time of finaling a payment in Unify.

To repeat, we are recommending that Unify AR be turned off and we convert to
SAP AR.  We will schedule a meeting the week of February 22 to discuss.
Please call me at X33179 with any questions or comments.  We WILL make this
decision by February 28 because the SAP timeline does not allow any
additional time for consideration.

Stephen


Teco Tap       20.000 / Enron ; 91.667 / HPL IFERC

LS HPL LSK IC       20.000 / Enron


>  -----Original Message-----
> From: 	scott neal [mailto:scott.neal@worldnet.att.net]
> Sent:	Tuesday, November 20, 2001 11:42 PM
> To:	scott.neal@worldnet.att.net
> Subject:	1121
>
>

 - winmail.dat


I needed to whine with you yesterday about my favorite nat gas trader and
couldn't get hold of you...and then my favorite lazy paralegal already passed
on some of her work to me!


i think we might go to someones place and then go out afterwards


Norma,

Happy New Year. Look forward to working with you in 2001.

Can you send the resume of L Xu to me in an electronic form?

Thanks

Vince


Tana, of course I thought of you first when I received this message from
Limor.  Do you have the info she needs or can you steer us in the right
direction?
Many thanks,
Laurie
----- Forwarded by Laurie Mayer/HOU/ECT on 05/15/2001 02:20 PM -----

	Limor Nissan/ENRON@enronXgate
	05/15/2001 01:58 PM

		 To: Laurie Mayer/HOU/ECT@ECT
		 cc:
		 Subject: ISDA site

Hi Laurie,

I wanted to use the ISDA site for members, and don,t know what Enron,s ID and
password are.  Any idea where I can find out?

Thanks,

Limor

Enron Global Markets
520 Madison Avenue
New York, NY 10022
Tel: 212.715.5283
Fax: 212.715.5608
E-Mail: Limor.Nissan@Enron.com


I'm not absolutely sure either, but I think she is saying they can provide a package that:

1) Provides IT staff that will not leave, and can backfill any attrition we may see.
2) Provide Cash for us to use as we see fit (i.e. retention) using our existing Hardware assets as collateral.
3) Help with any future integration work with the potential NewCo buyers (apparantly she knows who they are and they use IBM also, and she has contacts there).
4) Use IBM's name to help in anyway that may make the venture more likely to succeed.

Regards

Mark Pickering
Chief Technology Officer

Enron Net Works, LLC

  _____

 -----Original Message-----
From: 	Kitchen, Louise
Sent:	05 December 2001 12:33
To:	Pickering, Mark
Cc:	Piper, Greg
Subject:	RE: IBM

I don't understand whta she is offering

 -----Original Message-----
From: 	Pickering, Mark
Sent:	Wednesday, December 05, 2001 11:32 AM
To:	Kitchen, Louise
Cc:	Piper, Greg
Subject:	FW: IBM

Hi Louise,

Just got off the phone with Gail. She wants to know if they can help by coming up with a guaranteed offering from IBM that would help any NewCo succeed by providing IT support/direction, saving money, monetizing assets, retaining key staff and lending the IBM name, etc, etc to the deal.

If you're interested you can either call me or call her directly.

Regards

Mark Pickering
Chief Technology Officer

Enron Net Works, LLC

  _____

 -----Original Message-----
From: 	Piper, Greg
Sent:	05 December 2001 08:23
To:	Pickering, Mark
Cc:	Leff, Dan; Beck, Sally; Rub, Jenny
Subject:	FW: IBM

Anything here?  I think that at one time prior to filing IBM was looking to buy or monetize or loan against all out hardware so we could get cash but I am not sure where that went.

GP

 -----Original Message-----
From: 	Leff, Dan
Sent:	Wednesday, December 05, 2001 8:09 AM
To:	Dayao, Anthony; Piper, Greg; Beck, Sally
Cc:	Stubblefield, Wade; Sharp, Vicki
Subject:	IBM

Anthony, Greg, Sally -

Gail Whipple from IBM called to offer any assistance that they can provide.

Potential to save money, monetize assets, provide people, provide assistance to employees & people that we don't / may not need, etc.

If we would like IBM to assist, we need to call her @ 914-642-6399.

Thanks - Dan


BH,

I plan to be on vacation July 5-6 (finally) and on the customer trip on the
7th.  While I am out, Gary Hanks will be keeping our position during
trading.  Stacey will be in charge of everything else.  I am comfortable that
everything will be covered.

I will be back in town Thursday night.  The primary flight for the customer
trip leaves around 11:30.  Others leave at 3:30 and 5:30(?).   The latest
idea we had is that Pat would take a later flight on this trip and I will
take a later flight on the August trip, allowing one of us to be in the
office for half the day.  I can also come in for the half day on the 7th if
we decide that is needed.

D


Shalesh,

A good idea.  I shall forward it to the AG traders.

Vince

From:	Shalesh Ganjoo@ENRON COMMUNICATIONS on 05/01/2001 10:12 AM
To:	Nelson Neale/NA/Enron@ENRON
cc:	Vince J Kaminski/HOU/ECT@ECT
Subject:	Trading Ag Prods.

Nelson,

I know you are focusing on agricultural products for trading, so I just wanted to know if we are looking at Wool.  I know that it's traded in Australia and New Zealand, so we might be able to look into it as well.  Please let me know.  Thank you.

Shalesh Ganjoo


http://www.ets.oatiinc.com/cgi-bin/webplus.dll?script=%2Fets%2Fets-main.wml

https://iso_si/iso/

http://oasis.caiso.com/

http://www.tsin.com/nodes/wscc.html


fyi
---------------------- Forwarded by Jeffrey A Shankman/HOU/ECT on 12/07/2000
09:51 AM ---------------------------

	From:  Christian LeBroc @ ENRON                           12/07/2000 09:40 AM

To: Chris Abel/HOU/ECT@ECT, Susan D Trevino/HOU/ECT@ECT, Michael
Benien/Corp/Enron@ENRON
cc: Jeffrey A Shankman/HOU/ECT@ECT, John L Nowlan/HOU/ECT@ECT, Ted
Murphy/HOU/ECT@ECT, Bjorn Hagelmann/HOU/ECT@ECT, Homan Amiry/LON/ECT@ECT,
Cassandra Schultz/NA/Enron@Enron
Subject: Liquids VaR violation

Liquids VaR for effective date Dec. 06 is $8.5MM, a seven percent violation
of its limit.  The cause of the violation was due to the following factors.
Company wide crude position got shorter 6.3MM barrels
Short NG from Jan-Feb-01 of 1.2 BCF.  (EOL trade placed in error, position
Nowlan intended for was 10 contracts/month instead of 10 contract/day.)

With component VaR attached below, it is clear that crude product resulted
the most VaR increase.  Keeping everything constant, if Nowlan gets out of
his NG position, VaR would be $7.8MM.

Please contact me for questions

Christian x58062


FYI...I'll keep you informed.
  dave
---------------------- Forwarded by Dave Schafer/ET&S/Enron on 03/03/2000
11:15 AM ---------------------------

Shanna Funkhouser
03/03/2000 11:06 AM
To: Dave Schafer/ET&S/Enron@ENRON
cc:

Subject: Confidential - Job Description

Dave,

I had a short conversation with Scott this morning and explained the job, why
we have vacancies, etc.  He is going to evaluate the job description and see
if there would be any ties in this job to his future career goals.  In other
words, he doesn't see himself taking a long-term departure from Investor
Relations, but possibly there are some skills he would gain in this job that
would make him even more valuable in a future IR role.  For example, when he
was with El Paso, IR and PR were combined.

He said that he would follow up with me this afternoon or Monday and let me
know if he has interest in discussing further.

Shanna
---------------------- Forwarded by Shanna Funkhouser/HR/Corp/Enron on
03/03/2000 11:10 AM ---------------------------

Shanna Funkhouser
03/03/2000 11:03 AM
To: Scott Vonderheide/Corp/Enron@ENRON
cc:

Subject: Confidential - Job Description

Scott,

I'll talk to you this afternoon or Monday.

Thanks,
Shanna


With the departure of Greg Wolfe and Holli Krebs, it is necessary to reestablish responsibilities to assure our continued success.  To this end:

Chris Foster will assume responsibility for the Services Desk in addition to retaining overall responsibility for the Middle Market Coverage Group.  Although he will continue to provide leadership to John, Paul and Stewart in managing the Middle Market Coverage effort, Chris will focus his day-to-day efforts on our Services business.

John Malowney, Paul Choi and Stewart Rosman will be taking a greater leadership role within the Coverage Group.  Within this coverage group, John Malowney will assume a leadership role for Industrials throughout the WSCC, Stewart Rosman will assume responsibility for public utilities, IOUs and public/federal utilities in the Northwest and Northern California and Paul Choi will cover these same sectors in the Southwest and Southern California.  Although each of these individuals will take the lead in assuring coverage for their market segment, it will be done on a collaborative basis to take advantage of individual relationships and talents and to make sure there is back-up if someone is out of the office.  Additional personnel will be hired in the Middle Market Coverage Group within the next month.  Job postings will be made shortly.

Bill Williams will continue to manage the Real Time Group and will now report to Tim Belden.

Lisa Gang will move into the Services Group to help manage our scheduling agreement with El Paso and provide support for other services arrangements.  This will be effective September 10.  Lisa Gang, Les Rawson, and Stan Cocke will report to Chris Foster and endeavor to expand our already successful Services business.

While we will miss Holli and Greg personally, I have complete confidence that the new energy and fresh ideas that their departure brings will assure our market leader position will not compromised.


Is the 644,650 being tsf from central in 0012 for financial liquidations -
have not seen it on the central desk.  Thanks.
PL