I received a call from Jack Foley from the PG&E Credit Risk area regarding concerns to their exposure from TW. He cited that due to the' CC' S & P rating they had concerns regarding their monthly prepayment to TW of approximately $ 1.8 M, our marketing of their excess capacity, and the Operating Agreement at the interconnect regarding indemnification of the PCB cleanup. He stated that PG&E has exposure as a result of TW marketing their excess capacity which at present TW has paid PG & E it's portion. However, we are due to remarket in January for their Spring/Summer capacity where we bill, collect and remit to PG &E. Also, he advised that per the Operating Agreement at the interconnect, dated June 27, 1995, there is an indemnification for PCB cleanup and that we pay PG & E $ 300,000 to $ 400,000 per year and the agreement runs to 2007. He added that there is a reaffirmation of the 1995 agreement dated May 28,1999, with Steve and Lou as the signers. In order to alleviate their concerns, Foley proposed, 1) TW drop the prepayment requirement and 2) provide security/collateral to secure the remarketing and PCB cleanup. Please review and advise your comments. Regards.
Q: What is a potential subject line for this email?
answer: Pacific Gas and Electric - Transwestern Concerns
GTN Station 8 Capacity Restated Due to favorable operating conditions, the GTN capacity through Station 8 is being restated. Beginning with the Intraday 2 cycle for gas day October 22, 2001, and continuing through gas day October 23, 2001, the capacity will be restated to 1,950 MMcf/d through Station 8. Off-line deliveries upstream of Station 8 and receipts downstream of Station 8 will not be affected.
Q: What is a potential subject line for this email?
answer: GTN Station 8 Capacity Restated
I reviewed the latest draft of AA's management rep. letter and caught a few innaccuracies in the way AA described the deal. I attach a revised draft of the letter, with a redline version to highlight for you the changes I think we need to make to keep it accurate. First, AA only listed two of the four agreements that comprise the deal. They apparently forgot that we had created a second SBA. Additionally, at Transcanada's request, we put the transaction fee into a separate letter agreement this year. You will recall that last year, Sempra wanted the transaction fee put right in the SBA. Second, AA's bullet no. 4, as originally drafted, states that Northern does not intend to enter into an option to purchase any base gas during the term of the agreement. That statement is confusing given that Article VI.B of the Monthly Pack Agreement includes an account balance cash out mechanism that is a form of purchase option. That cash out mechanism was in Kent's bullets describing the deal and has been in every draft of the documents that AA looked at, so I assume they are OK with the mechanism and were just inartful in drafting bullet no. 4. My simple fix was to leave AA's language alone but to add an "except for" reference at the beginning of bullet no. 4. Third, AA's draft of bullet nos. 5 and 6 includes the somewhat ambiguous references to "other agreements" and "additional agreements" respectively. Since AA's list of the agreements in the intro paragraph was incomplete, these references in bullet nos. 5 and 6 were also innacurate. Now that I have made the list of agreements in the intro paragraph complete, I've clarified the bullets by adding the "other than those agreements referenced above" language to both bullets. The couple of other changes in bullet 5 simply clarify the meaning. Finally, I've modified the signature blocks per conversation with Bill to delete MKM and myself. I am certainly willing and able to sign this letter, but MKM is not up to speed on the deal and has not reviewed the agreements. Getting her up to speed enough to sign the letter would take some time. Additionally, Bill's thought was that MKM and I are his direct reports anyway, so it doesn't serve much purpose to have the subordinates sign if the top guy has signed. Please give me a call if you have any questions or want to discuss these matters.
Q: What is a potential subject line for this email?
answer: Mgt. Rep. Letter
President Lynch has today released the attached ACR concerning market valuation of the utilities retained assets. As you may know, AB 1890 originally required that for those generation-related assets that the Commission determines to be transition costs and that are subject to valuation, "the valuation 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." Lynch states that this requirement was changed by AB 6X and that, "I intend to recommend to my colleagues that the requirement to value generation-assets subject to valuation by December 31, 2001 has been superseded by AB 6X. Parties shall file and serve comments addressing this issue by January 15, 2002. Reply comments shall be filed and served by January 25, 2002." Dan
Q: What is a potential subject line for this email?
answer:
Lynch Ruling re Market Valuation