
Date: Thu, 30 Mar 2000 04:23:00 -0800 (PST)
From: colleen.sullivan@enron.com
To: mflewellyn@columbiaenergygroup.com
Subject: Re: storage clarification & issues
Cc: chris.germany@enron.com, dick.jenkins@enron.com, john.singer@enron.com,
scott.neal@enron.com
Bcc: chris.germany@enron.com, dick.jenkins@enron.com, john.singer@enron.com,
scott.neal@enron.com

Regarding your memo below, following is a status on those items:
1, 2:  The pricing and consistency in pricing for handling intra-month
changes does appear to be an issue.  Since the contract didn't spell out in
detail location by location pricing (and I think intentionally so), we
believe the best way to handle this for April forward is to agree monthly
(during bid week) of the process and pricing for each location.  I know Chris
Germany has prepared a proposal that I think he has discussed (generally, not
specific numbers) with Brian, Doug and Charlie.  I will ask that he forward
this proposal TODAY and finalize the process for April ASAP.  Let me know if
you do not think a monthly process of agreeing to the changes is sufficient.

3.  Local production - unfortunately I think we have opened a can of worms
here.   Here is what is happening:  Your people are nominating this
production (we are not even set up to do behind the citygate nominations),
but the contracts were assigned to us in the Wholesale transaction.  That
means they were valued by us and put into our system at a value.   We are
reviewing this detail now and are finding quite a few discrepancies between
the prices that were listed on the Wholesale Deal List and the actual
contract prices with the producers.  So, this is one issue we will have to
address as indemnification items.  That's problem one.  Problem two is that I
am assuming you all would like this production back since you are doing all
the nominations.  We need to work on a solution for doing this (if that is
what you want).  For Jan, Feb & Mar, however, it appears that we will be the
ones paying the producers, so we will need to get volume information from
your schedulers in order to get this billed and payed for properly.   I'll
follow up with more information on this in the next couple of days.

4.  Monthly invoices - regarding the pipeline demand charges, it sounds like
Chris has been trying to verify all the charges before he sends copies of the
pipeline invoices on to you.  Maybe we should change this process to one
where he sends them to you as soon as he gets them instead of waiting on his
confirmation and review of all the charges.  This means you may see quite a
bit of incorrect data, but at least you'll have something.  Let us know what
you would prefer.  Regarding the January invoice specifically, I do know that
the Columbia Gulf and Columbia Gas packet of pipeline invoices was mailed to
your office yesterday, March 29.  Chris will get all remaining demand charge
statements to your office by Wednesday, April 5, and all corrections he is
aware of as of this date by Friday, April 7.  I apologize for the delay.

5.  Swap confirmations - I spoke with Jeff Hodge and he believes he has a
packet of all the confirms--he is in Calgary today and will be back on
Monday.  Is that soon enough for this to be sent to you?  If not, please
advise and I'll see if his assistant can search for this data.

Thanks for clarifying the storage proxy schedule with the remaining inventory
balances.







