Ed and Mark, As we discussed, I spoke to Jeff Hodge and Travis McCullough about the best way to document this deal. We all agreed that it is better to document the deal as a deferred payment on the sale of natural gas rather than as a loan. Documenting the deal as a loan does not add any protection for Enron and in fact, may be detrimental because of the various laws concerning loans and lenders. The protections and remedies afforded by the Master track those that Enron would have under a loan document. Enron would be in no better position to collect from NUI in the event of bankruptcy under a loan document than under the Master Firm Purchase/Sale Agreement. Additionally, I assume that NUI, being a regulated utility, will not want to or be able to document this deal as a loan. Please let me know if you need additional information on this topic. Stacy
Answer: NUI Deal Documentation
We know you have questions about recent events impacting Enron and our plans for the future. Ongoing investigations and pending litigation have made it difficult, if not impossible, to share information in a timely manner. While we can't address certain issues, we can tell you about our initial plans to move Enron forward and emerge from bankruptcy, and we are eager to do that. We had planned to hold an all-employee meeting tomorrow, January 23, at the Hyatt Regency. However, we don't want to subject you to the media frenzy that would certainly surround such a meeting, so we've decided to postpone it. We are currently making arrangements to hold a series of employee meetings within the building to protect your privacy. We will provide the date and times to you as soon as the logistics for those meetings are finalized. Prior to the employee meetings, we will provide an overview of Enron's new organizational structure. You can expect that memo shortly.
Answer: Employee Meeting Postponed
I had a prior obligation at lunch on Mon. We need to reschedule the Leadership Dev. mtg. Fran, could you work with Emily and find a time? Sorry, I know I've disrupted this twice n ow! I'm good for lunch on Wed if that would work for everyone. df
Answer: Monday mtg.
In February, 539,594 Mmbtu were allocated to the our index purchase from HPLR Liquids at King Ranch. This allocation resulted in a large physical unaccounted for loss. Effectively, the gas was being purchased twice in our systems. In addition, a sale to the Liquids group, which should have been zero, was brokered with a purchase from Swift (2500 Mmbtu/day), resluting in additional gas being allocated to the HPLR Liquids purchase contract. I have attached a schedule detailing the volumes that were double booked in February. This schedule also reports the daily volumes for March which will need to be adjusted. I have calculated (based on estimates) that we should have only purchased about 88,000 from the Liquids group at King Ranch for February. See the following: Booked to HPLR Liquids: 539,574 18,606/day Purch by HPLC @ WH: 379,108 13,073/day Incorrect Liquids Sale: 72,500 2,500/day Adjusted purch from Liquids: 87,986 3,034/day We usually input a purchase of 2,500 Mmbtu/day from HPLR Liquids at the tailgate. We can increase this to 3,000/day for March. The majority of gas in the 3-Rivers system is transported to the King Ranch plant through HGPL. Some of this gas is purchased at the wellhead by HPLC, some of the gas is purchased at the wellhead by HPLR Liquids, and three producers have the option to either sell their gas to HPLC at the wellhead or to process their gas and sell the residue to HPLC at the tailgate of the plant. It is very important to keep the meters and volumes allocated correctly among parties related to these transactions. The attached schedule should assist in doing this. I have reported the meters at which HPLC buys wellhead gas. The movement of this gas through HGPL and King Ranch should be kept seperate from the gas purchased by the Liquids group. A transport usage ticket can be used to show the transfer of HPLC's gas from King Ranch to HPL. Let's plan on discussing this either Friday or Monday afternoon. Let me know what works best for you. D
Answer:
3-rivers / King Ranch / HPLR Liquids