IN: This is an email
To the West Desk et al: The FERC's west-wide price cap has been raised to at least $108/MWh beginning today through 30 April 02. Please see the order excerpt below. Although market prices are well below both the old and new cap, the new cap will give the markets more breathing room if there is an unexpected cold snap and/or supply disruption. I am happy to report that the one of Enron's advocacy messages made it into the order: any change to the cap must be applied West-wide. PNW parties and Duke were willing to settle with region-specific caps but FERC rejected that concept in favor of a single, West-wide value. Alan Comnes Relevant Passage: "Effective on the trading day following the date of this order, through April 30, 2002, we will suspend the methodology used to calculate the current mitigated price and substitute the following West-wide winter season methodology. As a starting point, the mitigated price will be set at $108/MWh. This is the actual mitigated price set using the current methodology during the last reserve deficiency on May 31, 2001, based on a gas index of $6.641/MMBtu, a generating unit with a heat rate of approximately 15,360 Btu/MWh and $6.00 for the O&M adder. The new interim mitigated price will supersede the existing mitigated price (approximately $92/MWh), which was set at eighty-five percent of the originally calculated $108/MWh mitigated price for application during non-reserve deficiency hours. We find this adjustment necessary to set the price for the winter period and to track changes in the gas indices. The winter formula will maintain the current heat rate and O&M adder. The one variable in the formula will be tied to the current average of the mid-point for the monthly bid-week index prices reported for SoCal Gas (large packages), Malin and PG&E city-gate. Under the winter season formula, the mitigated price will be recalculated when the average gas price rises by a minimum factor of 10 percent (e.g., to $7.305/MMBtu) effective for the following trading day. The formula will also track subsequent cumulative changes of at least 10 percent (including reductions of 10 percent, but not less than a floor of $108/Mwh). Effective on May 1, 2002, the summer methodology will be reinstated along with the current mitigated price of approximately $92/Mwh for non-emergency periods."

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OUT: Details on the West-wide Price cap: now $108/MWh through April 30, 2002.
QUESTION: EFFECTIVE 12/1/01 - RB Robertson & Sons is canceling his contract with Enron for approx 1,000/day metered production. Reason: With fixed prices in the $3.50-$3.70 range, Roc and his investors want to lock -in for a period greater than one year. He will sign a contract with Dominion Field Services.
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ANS: RB Robertson & Sons
Guys, I have explained the strategy/tactics that have lead to this position in some detail. In my opinion the company is not at risk and potentially ENA could create significant value from a project that we have very little invested. I understand the construction risk on the bid as much as anyone and we have no intention of lifting their offer. As far as EECC involvement, as I had mentioned, Coleman was a part of all these discussions. I will argue that Mike and the ENA deal team made the right call necessary to maximize return in the short run for Enron without investing significant dollars or taking significant risks. Obviously, I was unsuccessful in explaining such a sophisticated strategy. Regards
Q: What is a potential subject line for this email?
answer: Las Vegas CoGen
Please join Enron Training Sessions 11-12 MT Hood. The goal is to provide an overview of each major function in our office to anyone who is interested in learning about what goes on here. Schedule: 1/4 Tim Belden - Floor Overview 1/7 Matt Motley - Term Trading 1/8 Sean, Diana, Richter - Cash Trading / California Market 1/9 Stewart, Paul, Foster - Middle Market / Services 1/10 Tim H - Fundies 1/11 Alan - Regulatory 1/14 Donald - Scheduling 1/15 Bill - Real Time 1/16 Scotty - Volume Management 1/17 John - Risk Management 1/18 Susan, Steve, Christian - Credit & Legal 1/22 Todd - Structuring
Answer: Classes 11-12 Mt Hood
Here is an email: Ugh. We'll keep working this angle if their new attorney shows up on deck, but I think Susan and I have done as much as can be done with Howard H. Do any of you know what the Red Cedar facilities look like? I.e. how many miles of line, any big diameter line, any compression, etc? Howard must have read some old cases and gotten himself spooked that their facilites aren't gathering under the modified primary function test. I'm not sure why he thinks signing a transport contract with us will make their situation any worse, but that seems to be his conclusion. If Steve and Bill can't nudge Red Cedar's management into doing the deal, I'd suggest that you both or one of you ask Tsuri (sp?) to have his new lawyer call me and Susan after Howard leaves, maybe with one of the Kinder Morgan lawyers on the phone also, and we'll try to straighten this out.
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A: Red Cedar
QUESTION: We are deeply saddened by the tragic events of September 11th. No doubt each of us has been affected personally in some way by this. We would like to report that our offices are presently fully operational and you can reach us by phone, fax or e-mail to address any concerns you may have. Please let us know if there is any way we can be of assistance to you. Our strongest support and deepest sympathies go out to all our industry colleagues who have endured the horrors of these past days.
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ANS:
GGFP Operations