Enron CEO Skilling Reinvents Company, Unnerving Investors
Bloomberg, 05/01/01

World Watch
Wall Street Journal, 05/01/01

Setting The Agenda
Enron's Kenneth Lay on the Energy Crunch
SmartMoney, 05/01/01

WIND ENERGY PROJECT
Caribbean Update, 05/01/01

Sector Watch
Filling the Generation Gap
SmartMoney, 05/01/01

COMPANIES & FINANCE UK: Scot Power eyes Enron utility 
Financial Times, 05/01/01

ScottishPower in talks to buy Portland utility
The Independent, 05/01/01
 
Scottish Pwr FY00 Income Seen Dn On US, Regulatory Woes
Dow Jones Energy Service, 05/01/01

City briefing
The Guardian, 05/01/01
 
Pupils learn to work with water
The Northern Echo, 05/01/01

Home Depot, UPS chiefs ranked among America's 50 best CEOs BUSINESS PRESS
The Atlanta Constitution, 05/01/01

Henry McKinnell - Pfizer, Roger Joslin - State Farm, Other Top CEOs to 
Highlight New ``Win-Win'' Corporate Strategies in Low-Income Communities 
Business Wire, 05/01/2001

Arkansas Today
Associated Press Newswires, 05/01/01

Indian Lenders to Enron Unit Ask Govt to Pay Bill, Paper Says
Bloomberg News, 05/01/01

INDIA: Indian state to renegotiate Enron project-paper.
Reuters, 05/01/01
 
INDIA: PRESS DIGEST - Indian newspapers - May 1.
Reuters, 05/01/01

Enron amenable to reworking power pact with MSEB
The Economic Times, 05/01/01

BRIEFING - ASIA ENERGY - MAY 1, 2001
Asia Pulse, 05/01/01

NCS seeks strategic alliances with Indian firms
The Times of India, 05/01/01

India: ADB to provide over $5-b assistance to India
Business Line (The Hindu), 05/01/01

India: Enron renegotiation panel announced
Business Line (The Hindu), 05/01/01

India: Watching outcome of Enron issue: Ambani
Business Line (The Hindu), 05/01/01

Enron imbroglio not to affect ADB loans for India
Business Standard, 05/01/01

Loss-wary FIs ask govt to defuse Dabhol crisis
Business Standard, 05/01/01

USA: Enron buys Huntco's steel ops, makes supply deal.
Reuters, 05/01/01

San Francisco-Based Financial Firm Executives To Assume Some of CEO's Duties 
San Jose Mercury News, 05/01/01

Jesse Jackson Opens Houston Project Office
Houston Chronicle, 05/01/01
 
Investing/MONEY 30
A Slamarama For The New Economy
Money Magazine, 05/01/01






Enron CEO Skilling Reinvents Company, Unnerving Investors
2001-05-01 03:09 (New York)

Enron CEO Skilling Reinvents Company, Unnerving Investors

     (Published in May issue of Bloomberg Markets.)

     Houston, May 1 (Bloomberg) --  A year ago, Enron Corp.
CEO Jeffrey Skilling put up a banner in the lobby of his
company's Houston office tower that welcomed visitors to
``The World's Leading Energy Company.'' Skilling, 47, has
now decided that the company's tag should be more ambitious:
``The World's Leading Company,'' the banner says today.
     It's no shock that even the CEO isn't sure how to
describe Enron, for it's a company swept by constant change.
In the 1990s, Skilling transformed a regulated gas-pipeline
company into the largest competitor in the business of
trading energy, mainly natural gas and electric power.
      Now Skilling is pushing the company into Internet
trading of all sorts of things: paper products, plastics,
metals, fiber-optic bandwidth, commercial credit, pollution
emission controls, and even weather derivatives.
     All of this morphing unnerves investors, and some of
the company's ventures may not be growing as fast as Enron
says, according to analysts and industry insiders.
     They say the company is overstating the value of the
new businesses it's entering. Some investors are
increasingly concerned about a lack of clarity regarding
where the company is going -- and what exactly it does now.
     ``Owning Enron is a bit of a leap of faith,'' said John
Hancock Advisers Inc. mutual fund manager Greg Phelps, who
invests $1.1 billion in utility stocks and doesn't own any
Enron. ``I want to buy a stock where I have absolute
certainty about the business and direction it's headed.''

                   Exuding Nervous Energy

     Skilling, a man who exudes nervous energy and speaks in
rapid-fire bursts, says his track record should ease
investors' concerns. In the first quarter of 2001, Enron's
profit from operations rose 20 percent to $406 million as
revenue almost quadrupled to $50.1 billion.
     Enron shares have soared more than 11-fold since the
start of the decade, four times the gain of the Standard &
Poor's 500 Index. Enron's shares have dropped 25 percent
this year, closing at $62.72 on April 30.
     Enron isn't merely a trading company, Skilling says.
It's a logistics concern that ties together supply and
demand for any given commodity and then figures out the most
cost-efficient way to deliver that commodity to its
destination.
     Skilling, who joined Enron in 1990 after leading
McKinsey & Co.'s energy and chemical consulting practices,
is unapologetic about moving the company in so many
different directions. ``In five years, we'll be a different
company,'' he said. ``We're not finished reinventing
ourselves.''

                   $65 Billion in Assets

     Enron owns $65 billion in assets, including 32,000
miles of pipeline that span 21 states and transport 15
percent of all of the natural gas consumed in the U.S. The
company owns an 18,000-mile fiber-optic network in the U.S.
and controls 51 power plants and other energy projects in 15
countries on four continents.
     Pinpointing what Enron does isn't easy. Some businesses
are simple to grasp: In 2000, Enron won $16.1 billion in
energy management contracts from such giant corporations as
Owens-Illinois Inc. and International Business Machines
Corp.
     The bulk of Enron's money -- 93 percent of revenue and
more than four-fifths of profit in 2000 -- came from
wholesale energy operations and services: what it calls
``the financialization of energy.''

                     Cloaked in Secrecy

     This is largely the gas and electricity trading
business it pioneered. Enron cloaks the details of that
business in secrecy, citing competitive reasons, which makes
its bread-and-butter activities as difficult to understand
as the abstract Joan Miro lithograph that looms behind
Skilling's desk.
     ``Enron keeps a lot of facts close to the vest,'' said
Andre Meade, an analyst at Commerzbank Capital Markets.
``That makes constructing earnings models a real
challenge.''
     Even many of Enron's employees are shielded from the
intricacies of Enron's business. Signs in stairwells and on
office walls forbid employees from freely moving around the
building into trading rooms and other off-limits areas.
     For now, Wall Street is betting that behind closed
doors, Skilling and company will figure out how to extend
Enron's trading prowess into fast-growing industries.
     Of the 22 analysts who track Enron, 19 of them rate the
stock a buy.
     Enron traded at 40 times 2000 earnings on April 30.
That's exactly double the price-earnings ratio of 20 for
rival Duke Energy Corp., the biggest U.S. utility owner and
energy trader, and 42 percent higher than the S&P 500's
April 30 multiple.

                  `GE of the New Economy'

     ``Enron is uniquely positioned to be the GE of the new
economy,'' said Merrill Lynch's Donato Eassey. ``This isn't
a management team to bet against.''
     With analyst expectations so positive, some longtime
Enron holders are selling stock.
     ``Especially with its high valuation, the stock's
risky, and I don't see much upside,'' said Timothy Ghriskey,
senior portfolio manager at Dreyfus Corp., which controls
funds that sold about 1.55 million Enron shares at the end
of 2000. ``If they fail to deliver for one reason or
another, things could get ugly.''
     Enron says its 2001 sales will swell to at least $160
billion. Analysts and investors say there are several
trouble spots that could slow its growth.

                 Trading Broadband Bandwidth

     At a late-January meeting in Houston, Skilling told 170
analysts and investors -- and dozens of others hooked in via
the Web -- that Enron's biggest immediate opportunity is its
plan to trade broadband bandwidth: space on the fiber-optic
networks that zip voices, data, and images around the
planet.
     Skilling says that based on discounted cash flow,
Enron's broadband business is worth $36 billion, or $40 a
share. That's a hefty valuation considering the business
lost $60 million on $408 million in revenue in 2000.
     Enron has already hit a major roadblock in part of its
broadband plan: delivering videos over its own high-speed
fiber-optic network. In March, Enron and Blockbuster Inc.
broke off a planned 20-year venture to deliver movies and
other content directly into customers' homes.
     Enron says Blockbuster didn't provide the quantity and
quality of movies needed to deliver the service.

               Enron and Blockbuster Disagree

     Blockbuster has a different take. ``Blockbuster wanted
out of the deal basically because we had a lack of
confidence in Enron,'' said Karen Raskopf, Blockbuster's
vice president of corporate communications.
     Specifically, Blockbuster maintains that Enron couldn't
handle technical issues such as protecting the copyright of
the films that were to be distributed. ``Maybe Enron could
have worked those details out,'' Raskopf said, ``but we
decided there were plenty of other carriers out there that
were more sophisticated technically.''
     Several analysts and industry executives say that
Enron's broadband business isn't worth anywhere near the
valuation that Skilling talks about.
     ``I don't want to be disrespectful, because Enron's
made remarkable progress from its days as a regulated
pipeline,'' said Leo Hindery Jr., former CEO of Global
Crossing Ltd., which like Enron has a nationwide fiber-optic
network. ``But they're way out of their league in the
telecommunications business. The [valuation] numbers they
throw around are laughable; they'll be a bit player at
best.''

                  California Energy Crisis

     The California energy crisis is likely to derail
ongoing efforts to deregulate electricity markets in about
25 states and could slow the opening of markets in several
Asian and European countries as well, analysts and
consultants say, eliminating future profit streams.
     Not so, says Skilling. Deregulation is here to stay
despite the problems in California, he said, adding:
``Deregulation doesn't cause problems. Stupid deregulation
does.''
     Besides, he said, Enron merely trades and doesn't
produce power in California. The company's biggest business
is in the wholesale market, serving utilities and big
industrial suppliers, not retail customers.

              'Japan and Europe Are Opening Up'

     Plus, wholesale markets in Japan and Europe are rapidly
opening up. ``California won't nick us,'' he said.
     Critics charge that Enron, which doesn't reveal its
California financial results, has been reaping huge profits
during the crisis.
     ``California has been a feeding frenzy, with every
trading company in the world feasting on it, and Enron is
the biggest and shrewdest of them all,'' said Michael
Shames, executive director of the Utility Consumers' Action
Network.
     Doubters wonder whether Enron can succeed in new
businesses like fiber. ``I don't think this industry is
going to evolve as swiftly as Enron believes it will,'' said
Rod Woodward, a telecom services industry analyst at
consultancy Frost & Sullivan Inc.
     Skilling brushes off such skepticism. ``People who
throw stones at us don't keep me up at night,'' he said. ``I
worry about whether the air conditioner will blow and knock
out our computer servers.''

                   Proving Naysayers Wrong

     Skilling contends he's proved the naysayers wrong once
before. In 1991, at the Colorado ski resort of Beaver Creek,
in his first presentation to energy analysts and investors,
Skilling outlined his plan to transform Enron from an asset-
based pipeline company into a trading company.
     ``I basically laid out our trading model for them,''
said Skilling. ``The crowd yawned. They didn't get it. I was
brilliant. So we went out and proved we were right.''
     Skilling's intensity permeates Enron's headquarters. In
the lobby, about 20 employees wait in line for a Starbucks
coffee jolt -- at 4:30 p.m. In the company's elevators, TVs
blare with messages to ``maximize revenue.''
      There aren't many private offices in Enron's
headquarters building; most floors are open to encourage
communication between workers. Of the few walls that are
around, many are write and wash to encourage extemporaneous
diagramming.
     Skilling's office is filled with toys: a mini
basketball hoop, Koosh Ball rackets for his two sons. (He's
divorced and also has a daughter.)

                    182-Mile Bicycle Ride

     He's working himself into shape so this spring he can
lead about 500 employees on a 182-mile bicycle ride from
Austin to Houston for charity. He says he hates his 50th-
floor office, with its 20-foot ceilings, mahogany paneling,
and sweeping views of the nation's fourth-largest city.
      ``It's too quiet and too removed from any action,'' he
said.
     So he's moving to the seventh-floor trading room of a
40-story tower being built across the street from Enron's
current headquarters.
     Even on vacations, Skilling doesn't kick back. Every
year, the Pittsburgh native and Harvard Business School
graduate takes important customers on a trip. This isn't the
sedate corporate golf outing to Augusta National or Pebble
Beach. Skilling leads such jaunts as a seven-day trek
through the Australian outback and a thousand-mile dirt bike
expedition in Mexico.
     ``If I can't bust up a couple bikes, I don't really
want to go,'' he said.

                     Gung-Ho Atmosphere

     That sort of gung ho atmosphere is a far cry from
Enron's early days in 1985, when it was formed by the $2.4
billion merger of InterNorth and Houston National Gas and
became the largest natural-gas pipeline company in the U.S.
     The industry was in the midst of great upheaval, as the
Federal Energy Regulatory Commission began deregulating the
gas pipeline business. Until then, the business could have
been the poster boy for overregulation.
     By federal law, companies that owned pipelines could
sell gas only to a handful of gas and electric utilities
along their routes. If there were a big freeze in Chicago or
a heat wave in Atlanta, for instance, pipelines couldn't
reroute their supply to meet demand.
     In 1985, Chairman Kenneth Lay retained Skilling, who
was then a consultant at McKinsey, to help spot
opportunities as the business deregulated.

                  Government Loosens Rules

     Over the next few years, as the government slowly
loosened rules, Skilling put together a plan to buy natural
gas reserves and package them for sale at various prices to
any number of customer specifications: fixed prices,
floating prices with minimum and maximum caps, guaranteed
increases in supply if temperatures soared or plummeted.
     Both Enron officials and outside analysts say that
companies would save as much as 50 percent of their cost of
buying gas and Enron would profit from the trades and from
packaging other lucrative services such as futures and swaps
contracts that companies use to hedge their energy costs.
      ``There was a lot of initial resistance,'' said
Skilling, who joined Enron permanently in August 1990.
``Enron engineers had no concept about what we were trying
to do. They wanted to see the gas. It was like trading pork
bellies and asking to see the pigs.''

                     Big Trading Floors

     With Lay's backing, Skilling pressed ahead. He ripped
out walls and built big trading floors to foster
interaction. At first, the business grew slowly, through
phone-based trading desks.
     ``In the early days, we'd sit on our hands a lot,''
said Keith Hannon, who was in Enron's power business and is
now president and chief operating officer of Enron's
broadband unit. ``It took a while to find buyers and sellers
and convince them what we could do.''
     In the late 1990s, Enron extended its gas-trading
business to electricity. The U.S. government encouraged
competition in 1992 via the Energy Policy Act. About half of
the states began enacting laws or rules to let electricity
generators compete for retail customers on price, which
opened the door for Enron to replicate its buy-and-sell gas-
trading model for electricity.
     In April 1999, as Internet mania began sweeping through
even old-line corporations, John Sherriff, head of Enron's
European operations, and Greg Whalley, who was head trader
at the time, decided to take another look at using the
Internet to boost trading volumes.

                 Torpedoes Previous Efforts

     Skilling had torpedoed previous online efforts, fearing
the complexity of trading energy online and concerned that
opening up the system would expose Enron to too much risk.
      So well-known was his aversion to risk that the team
of employees that created EnronOnline didn't even tell
Skilling about it until two weeks before it was ready to
launch.
     It isn't a typical business-to-business exchange that
brings buyers and sellers together to negotiate trades. At
EnronOnline, which cost $20 million to put together, Enron
does all of the buying and selling. A trader with gas to
market sells it to Enron, which then finds a buyer for the
fuel.
     Enron either finds a way to deliver the gas or ships it
through its own pipes. That system enables Enron to skim a
profit at every stage of the transaction -- buying, selling,
and transporting the commodity -- in addition to packing on
lucrative services, such as swaps, options, and forwards.
      Competitors say that energy buyers won't be satisfied
with a site that allows them to buy from only one supplier.

                         EnronOnline

     ``A market is buyers, sellers, and speculators,'' said
Harvey Padewer, president of Duke Energy Group, which
oversees Duke Energy's nonutility business. ``EnronOnline
is, `Come buy from me,' and that isn't a market.''
     Skilling counters that Enron's results speak for
themselves. In 2000, its first full year of operation,
EnronOnline completed 548,000 transactions with a total
value of $336 billion, and its European business posted a
threefold increase in power trading and a fourfold gain in
gas trading.
     Enron's trading and risk management business did
especially well last year, with revenue up 150 percent and
profit up 10 percent, because of wide price swings in
California and other markets this past winter. Those swings
prompt energy buyers and sellers to try to lock in prices,
which Enron does with futures, forwards, and other financial
instruments.
     ``Volatility is what a trader like Enron thrives on,''
said Merrill Lynch's Eassey.

                Volatility Brings Competitors

     The volatility also brought in scores of competitors.
Last July, six of Enron's biggest rivals, including Duke and
El Paso Energy Corp., bought stakes in the Intercontinental
Exchange as part of a plan to take business from
EnronOnline.
     Entergy Corp., a New Orleans power company, and Koch
Industries Inc., a closely held refiner and gas pipeline
owner, formed an energy-trading venture in April.
     Other companies, including Bloomberg L.P., parent
company of Bloomberg News, and BayCorp Holdings Ltd., owner
of a New Hampshire utility, have developed electronic
marketplaces for energy.

                      Room For Everyone

     Skilling says there's room for everyone. The total
wholesale gas and power market in North America, Europe, and
Japan will grow to $1.7 trillion over the next several years
from $660 billion today, according to Enron estimates.
     ``Only about 40 percent of that market has
deregulated,'' said Skilling. ``So we still have more than
half of the market to go. I think a lot of that will be
transacted online.''
     While the competition is catching up in the business
that Enron pioneered, the company is forging ahead into new
opportunities -- such as weather.
     ``People laugh when they hear about us, and I hate
that,'' said Gene Taylor, 30, marketing director of Enron's
weather risk management business. ``We've processed 2,000
transactions since 1997 and have been profitable in each of
the last three years.''
     Weather brokers at other companies say that Enron's
claims sound reasonable. This past autumn, for example, an
executive at Bombardier Inc., a Montreal aerospace company
that also makes snowmobiles, did an Internet search for
weather trading and found Enron. Bombardier was offering
customers who bought new snowmobiles by October 1 a $1,000
refund if total snowfall in their area was less than half of
the average of the prior three years.

                     Bombardier Example

     Enron collected money from Bombardier for each
snowmobile sold and paid premiums in March so Bombardier
could refund customers in low-snowfall areas.
     Enron has doubled, to 26, the size of its weather-
trading staff and has tripled, to 9, the number of
meteorologists, plucking talent from places like the Weather
Channel, to grow the business.
     Taylor says his analysis of earnings reports reveals
that the bottom lines of 45 percent of all publicly traded
companies are somehow affected by weather.
     ``I see no reason why anyone should wear weather risk
when they hedge away things like currency fluctuations,''
Taylor said. ``By bringing weather trading online, we have a
big opportunity to bring in hundreds of companies and
process thousands of weather trades.''
     Other major players in this business include Southern
Co., Aquila Inc., and Koch Energy Trading.

              Fiber-Optic Broadband Opportunity

     Skilling says weather is a sideshow compared with
Enron's biggest business opportunity: fiber-optic broadband,
the hair-thin glass tubing that transmits data at the speed
of light.
     Until now, telecommunications carriers -- AT&T and
Level 3 Communications Inc., among them -- had sold
bandwidth in fixed-rate monthly contracts, locking buyers
into paying for capacity they didn't always need. Enron can
offer customers only as much bandwidth as they need -- and
on short notice.
     In October, for example, Enron signed a three-year pact
to manage the fiber-optic needs of i2 Technologies Inc., a
Dallas-based Internet software company.
     Under the deal, terms of which weren't disclosed, Enron
will provide i2 with the capacity to link its headquarters
with offices in Parsippany, New Jersey; Tokyo; Brussels; and
Mumbai and Bangalore, India, on an as-needed basis. Enron
will use its own network as well as other, unspecified
network providers.

                Where Profits Will Come From

     Skilling expects to profit in the broadband business in
other ways as well. He hopes Enron's trading system will
sell more service through its own network, which covers
18,000 miles -- a small portion of the 200,000 miles of
fiber in the U.S.
     He also expects to make money on the spread between buy
and sell prices for the bandwidth, as well as on related
activities like risk management.
     If successful, Enron says, the business could prove to
be a gold mine. The global broadband market will expand to
as much as $388 billion in 2005 from $155 billion in 2001,
Skilling says, and he estimates it could generate $1 billion
in annual operating profits in five years.

                    Aggressive Estimates

     Those estimates are too aggressive, several analysts,
consultants, and industry executives say, especially since
at least 16 different fiber-optic networks span North
America alone, and excess capacity has driven prices down
about 75 percent in a year.
     ``I give them credit for trying to change the market,
but they're spreading a lot of misinformation,'' said Chris
Lemmer, executive director of broadband trading and risk
management at rival Williams Communications Group Inc. in
Tulsa, Oklahoma.
     Lemmer says Skilling is looking at the entire broadband
universe -- wholesale, retail, and residential services --
when he projects industry growth. It's unlikely, Lemmer
charges, that Enron can get a healthy slice of each of these
disparate businesses.
     Competitors like Lemmer say that Enron isn't being
realistic and that its lack of expertise in the business is
showing. ``This isn't the gas business, where you can stick
pipe in the ground and leave it there for 20 years,'' said
Lemmer. ``In this business, infrastructure continually
changes, and Enron seems to be ignoring that because it
interferes with the propaganda they're trying to spread.''

               $36 Billion Value For Business

     So far, the results don't seem to justify Skilling's
$36 billion value for the business.
     Though Enron says the number of broadband trading
transactions in the first quarter of 2001 has risen to
400-500 from just 3 in the same period a year ago, the
business isn't yet profitable.
     In the fourth quarter, the broadband business reported
a $32 million loss on revenue of $63 million. ``They really
have to post the numbers and show that the broadband
business is going somewhere,'' said Commerzbank analyst
Meade.

                       Company History

     A glimpse at company history reveals that Enron doesn't
always deliver what it promises. A case in point is the
company's October 1998 purchase of Wessex Water Plc of the
U.K. for $2.8 billion in cash and assumed debt.
     Enron officials spoke of the water business in much the
same way they now talk about broadband: It's a fragmented
international market worth $300 billion a year, and Enron
could extend its expertise to this business and win a huge
share of that market.
     Lay tapped Enron vice chairman Rebecca Mark, one of the
most prominent women in U.S. business, as chairman and CEO
of Azurix Corp., an Enron subsidiary that was supposed to
win projects to repair, build, or buy government-owned water
systems.
     Mark cut a distinctive figure in the male-dominated
industry, wearing spike heels and miniskirts as she traveled
the globe negotiating complex energy projects.
     Azurix's performance never matched expectations. The
company was spun off in an initial public offering at $19 a
share in June 1999. The stock rose to a high of $24.25 in
August 2000 and then plunged all the way down to $3.38 by
October.

                       Executive Quits

     That prevented Azurix from using its stock for
acquisitions as the company had originally planned. Mark
quit in August and resigned from Enron's board. An Azurix
official says Mark plans to be a private investor in other
water businesses.
     In December, Enron bought back Azurix for $327.5
million, or $8.38 a share.
     Skilling says he's learned lessons from Enron's
struggles, helping him create what he describes as the
prototype 21st-century corporation.
     ``It's part of the learning curve,'' he said. ``I think
our legacy will be that we proved you can build a business
on intellectual capital, not physical assets.''
     A self-described business history buff, Skilling argues
that the era of corporate success based on gathering assets
is over. He says modern companies that try to emulate J. P.
Morgan's assembling of U.S. Steel or Harold Geneen's buying
spree to form ITT are making a mistake.

                     Exxon Mobil Merger

     He cites in particular the 1999 creation of Exxon Mobil
Corp. and Daimler-Benz AG's cross-border acquisition of
Chrysler Corp. ``Mergers like Exxon/Mobil were good ideas to
cut costs, but they'll run out of opportunities, and we
won't,'' he said.
     That's because, he argues, Enron isn't tied to its
assets in the same way as a big integrated company. ``If
you're stuck with a whole bunch of concrete that you can't
move, you're in trouble,'' he said.
     Only about 20 percent of Enron's $65 billion in assets
is tied up in plants and equipment, and Skilling says he's
willing to sell anything anytime. Skilling says he'd rather
spend money retaining good people, who are easily shifted
around to new businesses.
     ``We're brain-power intensive,'' Skilling said.
     When Enron created its broadband business, for example,
it moved 60 people -- mainly from Enron's energy-trading
units -- into the new division in the space of a week.

                      Skilling Not Shy

     Skilling doesn't shy away from voicing his opinions
publicly. In December, he stunned the crowd at Arthur
Andersen LLP's annual Energy Symposium in Houston by
predicting the demise of Exxon Mobil, an enterprise with
$17.7 billion in profit in 2000, and BP Amoco Plc, the third-
largest publicly traded oil company.
     He said that integrated oil companies -- ones that
drill for oil and natural gas, transport and refine it, and
sell the resulting fuels to consumers -- can't possibly be
the low-cost provider and producer in all of their
businesses.
     ``The odds of that are zero,'' he said. ``We have a
marketplace now that can provide virtual integration,
getting all those components quicker and cheaper. These big
companies will topple over from their own weight.''
     Soon after that speech, Skilling was promoted to CEO,
as Lay stepped aside. Lay, who remains chairman, said the
best time for succession to occur was when the company is
doing well.

                       Fine Judgments

     There's always the danger that Skilling will misjudge
which industries are ripe for Enron's Internet trading
platform and that some of Enron's biggest initiatives, like
its much-ballyhooed plans to shake up the broadband
business, won't meet their lofty expectations.
     There are heightened competition and the possibility
for unfavorable changes in the regulatory environment to
worry about as well. Skilling says his new job and the
challenges that come with it won't change too much the way
he operates. ``I'll probably have to be a little less
blunt,'' he said.
     For all of Enron's grand plans, that might be this
former pipeline company's biggest pipe dream.

--Adam Levy in Atlanta (404) 507-1305 or
adamlevy@bloomberg.net/kl


International
World Watch
Compiled by David I. Oyama

05/01/2001
The Wall Street Journal
A21
(Copyright (c) 2001, Dow Jones & Company, Inc.)
THE AMERICAS 
BRIEFLY: 
-- Petroleo Brasileiro will likely pay $240 million for the stake owned by 
Enron in natural-gas distributor Cia. Distribuidora de Gas do Rio de Janeiro, 
or CEG, a Petrobras official close to the negotiations said. 
 

The Agenda
Setting The Agenda
Enron's Kenneth Lay on the Energy Crunch
By Noah Rothbaum

05/01/2001
SmartMoney 
74
(c) 2001 SmartMoney. All rights reserved. 
We've all seen what energy deregulation has done to California. Could it 
happen in your state this summer? We put the question to Kenneth Lay, 
chairman of Enron, North America's largest marketer of electricity and 
natural gas. An early supporter of deregulation, Lay has testified before 
Congress on numerous occasions advocating deregulation. 
Q. What went wrong in California?
A. They didn't deregulate. They tried to, but they never got there. 
California was halfway in between: The wholesale market was deregulated, but 
prices for customers were fixed, and fixed in a way that competitors could 
not compete for customers without losing money. 
Q. Do you still think deregulation is a good idea? 
A. We think complete deregulation with consumer choice and competition will 
result in the lowest prices and the best alternatives for consumers, 
including a lot of innovations. 
Q. Are there other deregulated states that may run into problems? 
A. The New England states aren't nearly as competitive. There is a good 
chance they will have problems this summer. It could be a power crisis, or 
their consumers will not end up with the benefits that customers in places 
like Pennsylvania get. New York will probably be very tight. But it moved 
very quickly after last summer to buy turbines. I am told they will be 
generating electricity by this summer, so New York well may avoid a serious 
problem. 
Q. Will we see blackouts in other states besides California this summer? 
A. The most vulnerable area this summer is California. And because of that, 
other western states will be vulnerable to problems. The West is probably the 
most interconnected [electricity] reliability area in the country.

 

WIND ENERGY PROJECT

05/01/2001
Caribbean Update 

Copyright 2001 Gale Group Inc. All rights reserved. COPYRIGHT 2001 Caribbean 
Update, Inc. 
In early February, the National Congress approved the decree for the Enron 
Wind Energy Project to continue to negotiate its power purchase agreement 
(PPA) with the National Electric Energy Co. (ENEE). President Flores was 
expected to sign on soon afterwards. Enron is prepared to invest US$75 
million in a 60 mw wind generation project. 

The project would be the first to operate under Honduras' recently approved 
Renewable Energy Incentives Law, part of a wider effort to expand rural 
electrification.


 
Street Smart
Sector Watch
Filling the Generation Gap
By Odette Galli

05/01/2001
SmartMoney 
32
(c) 2001 SmartMoney. All rights reserved. 
These are dark days in Silicon Valley. Literally. 

Not only are tech companies watching their stock prices race downhill faster 
than Picabo Street at Lillehammer, they don't even know if the lights will 
stay on.

Take Solectron, the world's largest contract-electronics manufacturer. 
Rolling blackouts ordered by California's desperate utilities cut off power 
to seven of the company's buildings for two hours in January, costing "in the 
neighborhood of a handful of millions of dollars," in the careful phrasing of 
spokesman Kevin Whalen. It's enough to make a company think about getting off 
the grid. And some are. 

The Silicon Valley Manufacturing Group, whose members include industry 
heavyweights Cisco, Intel and Exodus, is reviewing options for 
self-generation, also called distributed generation. Known to the cognoscenti 
simply as "DG," distributed-generation technologies include microturbines 
(small-scale generators), fuel cells (which generate electricity with an 
electrochemical reaction) and flywheels, which store kinetic energy within a 
rapidly spinning wheel. 

And while it appears to be a drastic move even for power-hungry companies, DG 
offers tantalizing possibilities to investors who can stomach the risk of an 
emerging technology. 

One thing's for sure -- the energy shortage isn't going away. The U.S. power 
grid is facing an alarming supply and demand imbalance. According to Scott 
Sitzer, an economist at the Energy Information Administration, U.S. 
consumption of electricity increased at a 2.2 percent annual rate between 
1990 and 1999, while capacity rose just 0.8 percent a year. For the next 20 
years, the agency forecasts demand growth of 1.8 percent per year, which will 
require at least 410,000 megawatts of additional capacity to satisfy. But 
only 40,000 megawatts worth of power plants have been approved for 
construction over the next five years, according to John Hammerschmidt, 
portfolio manager and energy analyst at the top-performing mutual fund 
company Turner Investment Partners. 

And supply isn't the only problem -- quality matters too. Even a one-second 
interruption in power can wreak havoc on data centers, which require 24/7 
reliability. "The U.S. baseload power grid can only offer three nines 
reliability, or 99.9 percent, which means in one year you'll be down an 
average of eight hours," says Hammerschmidt. "The digital economy can't take 
blips; it needs to get up to six nines." 

So it's easy to see why DG could be a hot growth area. "Over the next 10 to 
15 years, DG could become 10 to 20 percent of U.S. generating capacity," says 
Bernie Ziemianek, director of distributed resources at the Electric Power 
Research Institute, a Palo Alto, Calif.-based R&D firm. Hammerschmidt agrees. 
He launched the Turner Energy & Power Technology fund on Mar. 1. "There are 
126 IPOs on the shelf in this area," he says. "This is going to be a very, 
very hot investable area, providing great returns over the next several 
years." 

These volatile stocks are not for the faint-hearted. Having been caught up in 
the tech frenzy of last year, many have crashed to sobering levels with the 
Nasdaq. Most are losing money. But Hammerschmidt doesn't see a dot-com-style 
bubble for DG. "I don't think they will get hyped to ridiculous valuation 
levels," he says, "because they're competing against the cost of a 
kilowatt-hour." 

One of his favorites is Active Power (ACPW, $18), which is down 77 percent 
from its 52-week high. Active is a leader in flywheel technology, which 
Hammerschmidt sees as better than batteries for backup before a generator 
kicks in, which can take seven or eight seconds. Unlike batteries, "which 
need to be replaced . . . flywheels need no maintenance and basically last 
forever," he says. He also likes the fact that Active has a marketing 
agreement with Caterpillar, the No. 1 manufacturer of diesel generators. "So 
when you buy a [generator] from CAT, they'll try to sell you a flywheel," he 
explains. "The numbers are staggering when you look at all the [generators] 
now hooked up to batteries." Hammerschmidt owns 750,000 shares, or about 2 
percent of the company, across the Turner funds, and he expects Active to 
turn a profit by the third quarter of 2002. 

David Smith, who recently launched coverage of several power-technology 
stocks at Salomon Smith Barney, likes Capstone Turbine (CPST, $23.88), which 
is off 76 percent from its high. 

"They already have commercial products out in the market, so they have a 
first-mover advantage. They are technologically more advanced than any others 
out there, and the timing is right," Smith says. Indeed, Capstone just opened 
a subsidiary in California. Soon after, Harza Energy, a Chicago-based 
engineering and energy-consulting firm, announced its intention to purchase 
2,000 Capstone microturbines for the Association of California Water 
Agencies. 

Quinten Nufer, the power-tech analyst at UBS Warburg, rates FuelCell Energy 
(FCEL, $47.50), down 56 percent from its high, a strong buy. Nufer says 
FuelCell's molten-carbonate cell is more efficient than competing products, 
and he likes the fact that the company has customers, including 
DaimlerChrysler and the Los Angeles Department of Water and Power. And Nufer 
is pleased that FuelCell has a partner in Enron, which has agreed to place a 
large order in exchange for warrants to purchase 9 percent of the company. 
"FuelCell's commercialization is upon us," Nufer says. "They'll start 
shipping units in May, right around the time we have power outages this 
summer, and you watch, we will." 

Performance data from 12/14/00 to 3/5/01. 
Source: Dow Jones Interactive



COMPANIES & FINANCE UK: Scot Power eyes Enron utility 
Financial Times; May 1, 2001
By ANDREW TAYLOR

Scottish Power is in talks with Enron, the US energy group, about buying its 
Oregon-based electricity utility Portland General. 
The Enron subsidiary supplies most of Portland's electricity. Talks are at an 
early stage and a deal is not thought to be imminent. 
Scottish Power bought PacifiCorp electricity group, which has its 
headquarters in Portland, in a deal worth Pounds 3.86bn in 1999. Scottish 
Power declined to confirm that it was in negotiations with Enron. The group's 
shares slipped 1 3/4p yesterday to 445p. 
A previous attempt by Enron to sell Portland to Sierra Pacific Resources 
broke down after the Nevada-based utility ran into power shortage problems on 
the US west coast. Andrew Taylor 
Copyright: The Financial Times Limited


Business
ScottishPower in talks to buy Portland utility

05/01/2001
The Independent - London 
FOREIGN
19
(Copyright 2001 Independent Newspapers (UK) Limited) 

SCOTTISH POWER has held talks with Enron about buying its Oregon- based power 
utility Portland General, which industry sources said would be a good 
geographic fit for the group's existing US arm, PacifiCorp. 
 
"It's an obvious one and, yes, there have been discussions," said one source, 
speaking after the official breakdown last week of Enron's talks to sell 
Portland to a Nevada-based utility, Sierra Pacific Resources.

PacifiCorp operates in six US states including Oregon, and has its 
headquarters in Portland, the state's largest city. Sierra, a utility holding 
company, had been preparing to pay about $2bn (pounds 1.4bn) for Portland and 
assume $1bn in debt. But the deal ran into trouble as the US West Coast power 
crisis unfolded earlier this year, and talks were officially called off on 
Thursday. 

Reports that ScottishPower might step in for Portland's 700,000 customer base 
and 2,000 megawatts of generating capacity surfaced at the weekend. 
PacifiCorp faces its own power crisis fallout, including $1m-a-day buying- in 
costs resulting from the failure of one of its generators. 

The problems have helped depress ScottishPower's share price, and it has 
underperformed the sector by 5 per cent over the past two years.  Yesterday, 
ScottishPower was tightlipped. "We do not comment on market speculation," a 
spokesman said. ScottishPower's shares fell 1.75p to 445p.

Scottish Pwr FY00 Income Seen Dn On US, Regulatory Woes
By Andrea Chipman
Of DOW JONES NEWSWIRES

05/01/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)
LONDON -(Dow Jones)- Scottish Power Plc's (SPI) earnings for the 2000 fiscal 
year are expected to be significantly lower than the previous year due to 
punishing costs from a U.S. generator's outtage and a strict price control 
regime for its regulated businesses. 
A survey of five analysts by Dow Jones Newswires produced a consensus 
estimate for Scottish Power's full-year pretax profit before exceptional 
items, goodwill and amortization, of GBP647 million, compared with GBP736 
million in fiscal 1999.
Individual pretax profit forecasts for the year ended March 31 varied from 
GBP569 million to GBP685 million. Analysts said the wide range was due to 
Scottish Power's decision last year to move to a different accounting system, 
and consequent disagreement over how much tax the company will report. 
Analysts predicted the company, slated to issue results Thursday, will have 
adjusted earnings per share of GBP30 pence. 
Those interviewed said they are hoping for a progress report on the status of 
the Utah-based Hunter power plant, owned by Scottish Power's Pacificorp unit, 
which has been out of operation since November at a cost of $1 million a day. 
Market participants said they are eager to know the extent to which Scottish 
Power is recovering its costs through the regulatory process, and to learn 
more about the company's plans in the U.S. A British newspaper reported this 
week that the U.K. utility is considering bidding for Enron Corp.'s (ENE) 
Oregon-based utility Portland General. 
"Most of the focus is going to be on the States," said Bruce Bromley, a 
utilities analyst at Credit Lyonnais in London. "We need clarity. We haven't 
had very much news flow, and we want to know what's happening with Hunter." 
The analysts also said they are hoping for strong statements from Scottish 
Power on its plans for telecommunications unit Thus Plc (U.THS) - whose 
shares have languished recently - and Southern Water. Thus Tuesday reported a 
2000 fiscal year loss before interest, taxation, depreciation and 
amortization of GBP21.4 million. 
Scottish Power has said it's considering various options for the water unit, 
including a sale. 
Company Web site: http://www.scottishpower.com 
-By Andrea Chipman, Dow Jones Newswires; 44-207-842-9259; 
andrea.chipman@dowjones.com



City briefing

05/01/2001
The Guardian 
Copyright (C) 2001 The Guardian; Source: World Reporter (TM) 
Help sought from drug firms 

Gordon Brown is to press pharmaceuticals companies to help tackle HIV, Aids, 
malaria and tuberculosis by agreeing to cut prices and carry out more 
research on infectious diseases in poor countries.

The chancellor and Clare Short, the development minister, are to meet with 
multilateral organisations as well as some of the world's wealthiest 
charitable foundations in New York today to elicit support for the fund. 

Details of the total raised, expected to be in the region of Dollars 
3bn-Dollars 4bn, could be released as early as June at a special meeting on 
Aids hosted by the United Nations. 'We call upon pharmaceutical companies to 
respond,' said Mr Brown. Scottish Power finds US target Scottish Power has 
been holding talks in the US about a possible Dollars 3bn ( pounds 2bn) 
takeover of Portland Power. Discussions with Portland's parent, Enron, 
followed the collapse of negotiations last week to sell Portland to Sierra 
Pacific Resources. 

The Glasgow-based utility has made no secret of its desire to expand across 
the Atlantic following its successful purchase of PacifiCorp and the 
opportunities for post-merger cost-savings. 

Sources confirmed talks between Enron and Scottish Power had taken place but 
the British company declined to comment on what it described as 'market 
speculation'. 
 
 


Pupils learn to work with water

05/01/2001
The Northern Echo
11
Copyright (C) 2001 The Northern Echo; Source: World Reporter (TM)
STUDENTS have plunged themselves into a new GNVQ science course thanks to 
help from Enron, on Teesside. 
About 60 pupils from Keldholme School, Middlesbrough, visited the Wilton 
International site of Enron to see water filtration in action in an 
industrial environment.
Working in groups of ten, the students tackled a project to clean river water 
using standard school equipment. 
They visited Enron's water treatment plant, where performance manager Gordon 
Harris and quality control chemist Clive Gallagher demonstrated various 
filtration techniques. 
Mr Harris said: "We showed them how to filter water and analyse samples in 
the laboratory and then toured the site to look at the large industrial sand 
filter units in operation. 
"We also showed them how we backwash the filters to clean and reuse the 
sand." 
The students were also told about the other utilities and services provided 
by Enron and given an outline of the type of career opportunities available 
across the Wilton International site.



Business
Home Depot, UPS chiefs ranked among America's 50 best CEOs BUSINESS PRESS
Tom Walker
STAFF

05/01/2001
The Atlanta Constitution 
Home
E.4
(Copyright, The Atlanta Journal and Constitution - 2001) 

James Kelly of United Parcel Service, and Robert Nardelli, who joined Home 
Depot in December, rank 24th and 31st, respectively, on this year's "50 best 
CEOs" list compiled by Worth (May) magazine. 

The magazine describes the top 50 as "business leaders with the foresight, 
judgment and competitive juice to make their investors happy."

The top five are Steve Ballmer of Microsoft; Jeffrey Skilling, Enron; Philip 
Purcell, Morgan Stanley; James Morgan, Applied Materials; and Margaret 
Whitman, Ebay. 

The wealth effect myth 

The value of common stocks has plummeted, but consumers keep on spending. 
What gives? Not the consumer's willingness to spend, says Forbes (May 14), 
since most people don't worry about their stock holdings when shopping. 

This seems to contradict the "wealth effect," or the concept that rising 
stock prices buoy consumer spirits and prompt them to save less from ordinary 
income and spend more, even if the money is borrowed. 

But Forbes cites research by the New York Federal Reserve Bank showing that 
temporary fluctuations in stock values "have virtually no impact on 
consumption." The researchers say that consumers distinguish between 
"permanent wealth," such as bank savings, and "transitory wealth," such as 
stocks whose value can erode. 

Return of the IPOs 

IPO almost became a dirty word last year when investors who put their money 
in initial public offerings watched as their shares plunged. But Business 
Week (May 7) sees a revival of the IPO market. 

"After a long, harsh winter, signs of IPO life seem to be popping up like 
crocuses in spring," the magazine says. "There's the pending $5 billion Kraft 
Foods offering, a deal by Prudential Insurance to raise $3.9 billion, and the 
announcement of plans by Accenture, the former Andersen Consulting, to move 
ahead with a $1 billion offering." 

But don't be fooled, says Business Week. "This season's bloom isn't anything 
like the good old days, when the IPO of anything.com could be counted on to 
rocket upward. Now the IPO market is dominated by old-line traditional 
companies that, for the most part, have size, brand name recognition and most 
importantly, profits." 

The latest Barron's (April 30) also gauges the health of the IPO market. 
Worth mentioning ... Many strategists scoff at seasonality, or the idea that 
stocks perform in certain recurring patterns. But Mutual Funds (May) says 
this strategy would have beaten the market in the past 20 years. Example: Buy 
three trading days before a holiday - -- the market typically has a 
short-term rally right after a holiday. Inc. Magazine (May 15) says scores of 
companies are discovering the potential of inner-city markets. The magazine 
for entrepreneurs says inner cities "are hotbeds of activity for minority- 
and women-owned companies, with (success) rates far above the national 
average."

 
Henry McKinnell - Pfizer, Roger Joslin - State Farm, Other Top CEOs to 
Highlight New ``Win-Win'' Corporate Strategies in Low-Income Communities
05/01/2001
Business Wire
(Copyright (c) 2001, Business Wire)
NEW YORK--(BUSINESS WIRE)--May 1, 2001-- 

Unprecedented Report from the Ford Foundation to be Released
Audio Conference at 11 AM (EST) on May 8, 2001 
Speak with Henry McKinnell (Pfizer) and Roger Joslin (State Farm), and 
business experts Michael Porter (Harvard Business School) and Carl Stern 
(Boston Consulting Group), just a few of the CEOs who are featured in a 
first-ever Ford Foundation report highlighting a new economic trend: 
"Win-Win: Competitive Advantage Through Community Investment," in an audio 
press briefing on Tuesday, May 8, 2001 at 11 AM EST. 
The CEOs will discuss innovative business strategies companies are using to 
achieve bottom-line benefits from their investments in inner-city and 
low-income communities. They will explain how these strategies helped them 
address business problems in areas such as employee recruitment and 
retention, the development of untapped markets, purchasing of quality goods 
and services, and building brands. The Ford Foundation will announce the 
report's findings and its impact on corporate strategies in these 
communities. A Question-Answer period will follow the presentation. 
The Ford Foundation's report, "Win-Win: Competitive Advantage Through 
Community Investment," chronicles a new trend: Major corporations, many of 
them Fortune 500, leveraging their investments in inner-city and low-income 
communities to impact their bottom-line while also creating economic 
opportunities in these communities. Companies featured in the report include 
Dell, DreamWorks, Enron, Sears, Target, Bank of America, and many others. 
The Ford Foundation, one of the largest philanthropic institutions in the 
world, launched the $30 million Corporate Involvement Initiative in 1996 to 
encourage corporate-community alliances that produce win-win scenarios. The 
"Win-Win" report is a product of this initiative. 
Media Briefing to Unveil Ford Foundation "Win-Win" Report

WHO: Henry McKinnell, CEO, Pfizer
Roger Joslin, Chairman, State Farm
J.W. Marriott Jr., Chairman and CEO, Marriott International
Bruce Nordstrom, Chairman, Nordstrom
Carmen Castillo, CEO, Superior Design International
Jerry Shroat, CEO, Personal Lines Property, Travelers
Insurance
Richard Hartnack, Vice Chairman, Union Bank of California
Michael Porter, C. Roland Christensen Professor of Business
Administration, Harvard Business School
Carl Stern, CEO, Boston Consulting Group
Melvin Oliver, Vice President, Ford Foundation
Michele Kahane, Program Officer, Ford Foundation

WHEN: May 8, 2001 -- 11 AM Eastern Standard Time
DIAL-IN NUMBER: For dial-in number and access code, please call 310/575-9200.
CONTACT: Laufer Green Isaac Judith S. Lederman, 310/575-9200 or 800/575-3263 
Judy@lauferpr.com 
06:02 EDT MAY 1, 2001 



Arkansas Today

05/01/2001
Associated Press Newswires
Copyright 2001. The Associated Press. All Rights Reserved.
Blytheville plant to close, affecting 100 workers 
BLYTHEVILLE, Ark. (AP) - A plant related to the steel industry announced 
Monday it would close its operation in Blytheville, putting 100 employees out 
of work. 
Huntco Inc., an intermediate steel processor, said the plant would close in 
60 days. The company said it has an agreement to sell the cold rolling and 
coil pickling plant to Houston-based Enron Industrial Markets as part of a 
larger transaction. 
"We plan to permanently suspend our cold rolling and pickling operations 
whether or not the transactions with Enron are ultimately consummated," said 
Robert Marischen, president and CEO of Huntco, based in Town & Country, Mo. 
He said the move would benefit Huntco and its shareholders, as well as its 
remaining workers. "Notwithstanding this, we regret the impact that this 
closure may have in the near term on our workforce in Blytheville," Marischen 
said. 
The company expects to meet open sales commitments over the next two weeks. 
Limited operations will be conducted thereafter until shutdown. Affected 
workers will be paid through the next 60 days. 
Huntco Inc. is an intermediate steel processor, specializing in processing 
flat rolled carbon steel.


Indian Lenders to Enron Unit Ask Govt to Pay Bill, Paper Says
2001-05-01 00:18 (New York)


     New Delhi, May 1 (Bloomberg) -- Indian financial institutions
that loaned money to Enron Corp.'s local unit asked the federal
government to honor guarantees and pay dues owed by a provincial
utility, Business Standard reported, citing a letter to the
finance ministry.
     The Maharashtra State Electricity Board, or MSEB, has refused
to pay bills of 3 billion rupees ($64 million) owed to Dabhol
Power Co., saying they are too high. The $3 billion unit of the
world's largest energy trader has invoked counter-guarantees, or
guarantees by the federal government, against the non-payment.
     The lenders have demanded that the federal government pay the
1.02 billion rupee bill for December 2000 to help prevent Dabhol
filing for insolvency, the paper said.
     Last week, Dabhol's board authorized the company to issue a
termination notice to its sole customer, the MSEB. That may
include a declaration of bankruptcy, the paper said.
     Dabhol has borrowed about $2 billion from lenders, including
ABN Amro Holding NV, to build the 740-megawatt capacity plant. The
rupee portion of the loan doesn't carry a repayment guarantee from
the government. Dabhol is 65 percent owned by Enron.

(Business Standard, 5/1, p.1)

--Nabeel Mohideen in the New Delhi newsroom (91-11) 334-8807 or at
nmohideen@bloomberg.net/apj



INDIA: Indian state to renegotiate Enron project-paper.

05/01/2001
Reuters English News Service
(C) Reuters Limited 2001.
NEW DELHI, May 1 (Reuters) - India's Maharashtra state, seeking to defuse a 
payments row with Enron Corp's Dabhol Power Co, has set up a group to explore 
restructuring the troubled power project, a financial daily said on Tuesday. 
The negotiating group, to be headed by former bureaucrat Madhav Godbole, will 
look at cutting power tariffs as well as third-party sales if the utility 
cannot absorb power generated by Dabhol's 740 MW plant, the Business Standard 
newspaper said.
Dabhol Power Co - 65 percent owned by Enron - is embroiled in a bitter 
payments dispute with Maharashtra and faces a cash crunch as the Maharashtra 
State Electricity Board (MSEB) has defaulted on payments worth 2.26 billion 
rupees ($48.3 million). 
Houston-based Enron, India's single largest foreign investor, is setting up a 
$2.9 billion, 2,184 MW power project in the western Maharashtra state. The 
project's 740 MW first phase is in operation while the 1,444 MW second phase 
is expected to be commissioned later this year. 
The newspaper also said Indian term-lenders to Dabhol had written to the 
federal government asking it to honour its counter-guarantee and pay 1.02 
billion rupees owed to Dabhol by MSEB for power bought in December. 
The domestic lenders, led by the Industrial Development Bank of India, want 
the government to step in save the banks from posting "irreparable losses" if 
Enron walked out of the project, the newspaper said. 
Last week, Enron's board of directors gave Dabhol's managing director 
permission to seek to end the contract at any time. 
Dabhol owes money for power bought in December and January. Last month, MSEB 
paid 1.34 billion rupees for power bought in March. 
The newspaper said the terms of reference for Godbole's group includes talks 
with Dabhol on separation of the LNG facility from the power project and 
whether power could be sold to federal government-owned distribution 
companies. 
The group is to submit its report within a month. ($1=46.8 rupees).

INDIA: PRESS DIGEST - Indian newspapers - May 1.

05/01/2001
Reuters English News Service
(C) Reuters Limited 2001.
Following is a summary of major Indian business and political stories in 
leading newspapers prepared for REUTERS by Business Databases Pvt Ltd, New 
Delhi. Tel:+91-11-3312051/84/86 Fax:+91-11-3351006. 
Reuters has not verified these stories and does not vouch for their accuracy.
Business Standard 
INSTITUTIONS ASK GOVERNMENT TO DEFUSE DABHOL CRISIS 
Indian lenders to the Enron-promoted Dabhol Power Company (DPC) have asked 
the government to honour its counterguarantee to end the impasse over the 
project. Financial institutions have asked the government to immediately step 
in to defuse the crisis and save them irreparable losses if Enron walks out 
of the project. This is possibly the first instance of onshore lenders moving 
the finance ministry to save a project. 


Enron amenable to reworking power pact with MSEB
Girish Kuber

05/01/2001
The Economic Times
Copyright (C) 2001 The Economic Times; Source: World Reporter (TM)
MUMBAI 
US energy major Enron has shown willingness to renegotiate the power purchase 
agreement with the Maharashtra State Electricity Board, accoding to state 
government officials.
Meanwhile, the Madhav Godbole panel has been asked to negotiate with Dabhol 
Power Company for the separation of its LNG facility. 
Enron, though the state government yet to communicate to them about the 
renegotiating panel officially, has informally expressed its willingness for 
renegotiations, a senior official from the states administration informed ET 
on Monday. 
We have some informal channels of communication and they are still alive 
despite the public rhetoric, he said. However, when contacted, Enron 
officials refused to react to the proposed renegotiation. 
Meanwhile, the state government has asked the Godbole panel to negotiate with 
DPC to restructure the project including separation of LNG facility, to bring 
down the tariff and all other related aspects. The state government on Monday 
announced the formation of the renegotiating panel. 
The panel has been given a months time to finish its task. It will negotiate 
with DPC for direct sale of surplus power, not needed by MSEB, to third 
parties including the Government of India or their agencies. 
The panel will invite DPC formally for discussion very soon, say sources. 
As reported by ET on April 28, the Madhav Godbole committee has been 
entrusted the responsibility of renegotiating the Enron deal. 
The other members of the panel are Deepak Parikh, RK Pachauri, Dr EAS Sarma, 
Kirit Parikh, Central governments nominee, states energy secretary Vinay 
Mohan Lal, finance secretary SK Srivastav, chairman MSEB Vinay Bansal and the 
chairman of the central electricity authority. 
The Infrastructure Development Finance Company will be assisting the panel. 
The most important task before the panel will be to delink the LNG facility 
created by Enron from the DPC to bring the project cost down. 
The Godbole panel has blamed Enron for clubbing around $500m, the cost of LNG 
facility, with the project cost and recommended the separation of two. 
The LNG facility, which is part of the second phase (1,444 mw) of DPC, 
includes a receiving terminal, storage tanks and a re-gassification plant. 
The construction of the facility is almost complete and the first delivery of 
LNG is expected by the end of 01. The receiving terminal would create 
infrastructure to enable the supply of 130,000 cubic meters of natural gas by 
LNG tankers.



BRIEFING - ASIA ENERGY - MAY 1, 2001

05/01/2001
Asia Pulse
(c) Copyright 2001 Asia Pulse PTE Ltd.
An executive briefing on energy for May 1, 2001, prepared by Asia Pulse 
(http://www.asiapulse.com), the real-time, Asia-based wire with exclusive 
news, commercial intelligence and business opportunities. 
ENRON OF THE US NOT INTERESTED IN COMPLETION OF INDIAN PROJECT 
MUMBAI - India's Enron-backed Dabhol Power Company (DPC) said it is "not 
interested" in completing the US$3 billion power project in India's western 
state of Maharashtra, following non-payment of dues by the state electricity 
board (MSEB) and the federal government's refusal to honour the Rs 1.02 
billion counter-guarantee. 
In DPC's board meeting in London on April 25, Enron India managing director K 
Wade Cline and DPC president Neil McGregor made it clear that they were "not 
very keen to complete the project, because management felt that both the 
state government and the the federal government were undermining the gravity 
of the situation," a senior state government official who attended the 
meeting told PTI.  
CHAMBER CHIEF CALLS FOR PRIVATISATION OF INDIA'S POWER SECTOR REFORMS 
NEW DELHI - Confederation of Indian Industry (CII) has demanded 
'depoliticisation' of power sector reforms to 'enthuse and encourage' private 
investment even as it said that the Enron controversy would not impact future 
investments in the sector. 
"We need to depoliticise tariff fixation and set up a strong and independent 
regulator without interference from state governments," Sanjeev Goenka, 
President, CII told PTI. 
(C) Asia Pulse Pte Ltd. 



NCS seeks strategic alliances with Indian firms
Satya Prakash Singh

05/01/2001
The Times of India
Copyright (C) 2001 The Times of India; Source: World Reporter (TM)
BANGALORE: A new era of technology collaboration is dawning between India and 
Singapore. A series of meetings between Union IT minister Pramod Mahajan and 
his Singaporean counterpart, Yeo Cheow Tong, has ushered in a fresh paradigm 
in the relationship between the two countries. 
"Made in India and showcased in Singapore," seems to be the new maxim.
In order to take this new 'thinking' forward, National Computer Systems 
(NCS), a leading Singapore-headquartered systems and network integrator, is 
scouting for Indian partners to form strategic alliances to address the 
booming Asian services market. 
This initiative is expected to kick-start the 'Asian Ecosystem' - to 
steamroll the new economy. 
In this connection, NCS chief K.C. Lee is in India to meet prospective 
technology companies for such partnerships. He will be meeting a few key 
infotech companies located in Bangalore, New Delhi and Mumbai. 
``The objective of these strategic alliances will be to leverage the 
technical skills of the Indian companies and then showcasing the combined 
offerings in Singapore,'' Lee said. He says NCS, a part of the reputed 
Singapore Telecom, on its part will bring in its expertise in the areas of 
banking, finance, infrastructure and e-governance, besides the marketing 
activities. 
The idea is to use Singapore as a test care point and roll out the offerings 
that are made in India. According to Lee, India has a strong brand name in IT 
services and Singapore offers a better marketing platform, and the proposed 
alliances offer a win-win situation to both. 
Once this model is successful in Asia, NCS plans to extend it to Europe and 
USA. ``Nothing stops us from going to Europe and the US.'' Lee added. 
In India over the last two-and-a-half years, NCS has executed a few key 
projects in the areas of banking, finance, large corporates and service 
providers. These include HDFC bank, ICICI Bank, Epson, ISPs like SpectraNet, 
and even an Internet Data Centre for Enron among others. 
Under the ambitious `Singapore 2001' project, the whole island-nation was 
networked with an efficent connectivity infrastructure. 
NCS is also keen on exceuting e-governance projects in India. Despite the 
sloth seen among state governments to implement e-governance initiaves, Lee 
says that he is patient and not giving up hope. 
``With the state governments asked to apportion definite resources, we may 
see some e-governance-related projects being initiated,'' Lee pointed out. He 
feels that although most of the government departments have some elementary 
computerisation in place, they still need to develop strong back-end 
operations __ integrating several arms of the government.



India: ADB to provide over $5-b assistance to India

05/01/2001
Business Line (The Hindu) 
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - 
Asia Intelligence Wire 
NEW DELHI, April 30. AFTER a spell of deceleration in lending following 
sanctions on India in the last couple of years in the last decade, the Asian 
Development Bank (ADB) is all set to make good by extending over $5 billion 
by way of its Country Assistance Programme to India in the next four years. 

Disclosing this to newspersons here, a senior official from the Manila-based 
regional development bank, Mr Klaus Gerhaeusser, said that for the current 
year the Bank's lending to India would be of the order of $1.6 billion, 
including $500 million to earthquake affected Gujarat, $300 to $350 million 
for power sector in Madhya Pradesh and an additional $300 million for private 
sector participation in infrastructure, $240 million for western corridor of 
the Prime Minister's Golden Quadrilateral highway project and $210 million 
for West Bengal's Metro Rail Project.

Mr Gerhaeusser said that from 2002 to 2004, India would get on average $1.2 
billion a year so that the medium-term country assistance to India would 
reach $1.6 billion beyond 2004. 

He said the ADB officials held intensive discussion with Indian Government 
officials both at the Centre and in the States during the last two weeks to 
wrap up the Bank's Medium- Term Lending Programme covering 2001-2004 
four-year period. 

He said the States under focus, from the Bank's point of view, include Madhya 
Pradesh, Gujarat and Kerala, though during the current visit of the Bank 
mission exploratory talks were initiated with the newly-formed State 
Government of Chhattisgarh. 

Besides, these States, other States keen on getting lending from the ADB 
include Tamil Nadu and Karnataka, he said adding that the Bank enters into 
comprehensive dialogue with the respective States about the sector in which 
loan was being made so that reforms in this sector and overall macroeconomic 
position of the State could be thoroughly reviewed to make the future project 
lending to them "sustainable". 

Alongside, he said, the Bank discusses the tax reform, expenditure 
management, debt management including restructuring and reform of State-owned 
enterprises. He said one of the mandates of this mission is to discuss with 
State governments to what extent they are committed to undertake reforms and 
sustain them so as to qualify for continued future assistance from the Bank. 

On the loan assistance programme, he said traditionally the Bank supported 
power sector in States but now it was extended to the Centre also. 

"Discussions are ongoing with Power Finance Corporation to leverage reform in 
other reform-minded States, particularly given the importance of power sector 
in rural electrification," he said. 

Once the National Highway Development Programme (NHDP) is through by 2003, 
the Bank would start dialogue with the National Highway Authority of India 
(NHAI) for assisting the Golden Quadrilateral highway corridor programme in 
which the Bank could provide technical assistance in the form of capacity 
building for executing agency to prepare project preparation and logistics 
management, Mr Gerhaeusser said. 

He said the Bank's offer of assistance for West Bengal in the highway 
corridor programme was mainly due to "sub- regional considerations, given the 
strategic location of the State in that area". 

Asked about whether the Enron tangle would have any effect on the Bank's 
assistance to power sector lending programme in India, Mr Gerhaeusser said 
that "we do not like to comment on this issue. The Government of Maharashtra 
and the Central Government were dealing with this". 

He, however, said that the Bank undertakes power sector programme with the 
State Government concerned only after thoroughly satisfying itself with 
various parameters of the concerned State's commitment to reform in the 
sector. 

To a query about how much component of over $5 billion loan assistance to 
India would comprise soft loans being extended from the Bank's Asian 
Development Fund (ADF), Mr Kazu Sakai, Programme Manager of India at ADB said 
that last year negotiations for fresh pledge to ADF were over. 

"Unfortunately, both India and China were not to get this assistance. So all 
the assistance for India would be from the Bank's Ordinary Capital 
Resources(OCR)," bearing market- related interest. 

To a specific query about the Bank's commitment to extend loan for 
restructuring Indian Railways, Mr Gerhaeusser clarified that the Expert 
Committee on Restructuring of Indian Railways had not completed its final 
report and there was a delay of one and a half year.  He said that assuming 
that report would be ready within the next few months, it would be discussed 
thoroughly by all the people concerned and "it is premature to talk about 
assistance in terms of big loans for restructuring Railways", he added. 
- Our Bureau

 

India: Enron renegotiation panel announced

05/01/2001
Business Line (The Hindu) 
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - 
Asia Intelligence Wire 
MUMBAI, April 30. THE Government has announced the Dabhol project 
renegotiation committee. 

The persons on the panel include Mr Vinay Bansal, Chairman, Maharashtra State 
Electricity Board, Mr Sudhir Shrivastava, Secretary, Expenditure, and Mr 
Ashok Lavasa, Joint Secretary in the Economic Cell at the Centre, apart from 
all the members of the Godbole Committee.

The Energy Review Committee headed by Dr Madhav Godbole had Mr E.A.S Sarma, 
Mr Deepak Parekh, Mr Rajendra Pachauri, Mr V.M. Lal and Mr Kirit Parikh as 
members. 

The new panel's terms of reference include restructuring of the project and 
tariff, finding out if any central power utilities or States would be willing 
to lift surplus power generated by DPC, and any other issue or aspect it (the 
panel) deems fit to include. 

Meanwhile, sources said DPC has slowed down construction work at the project 
site. They said the company retrenched about 2,500 construction workers 
recently. A company spokesman, however, said it is because of the project 
nearing completion and the workers were no more required. 

Such retrenchment has been going on for some time now. 
- Our Bureau

 

India: Watching outcome of Enron issue: Ambani

05/01/2001
Business Line (The Hindu) 
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - 
Asia Intelligence Wire 

MUMBAI, April 30. THE Reliance group is closely "watching and waiting" the 
outcome of the on-going controversy over Enron's Dabhol power project to make 
any further move vis-a-vis its Patalganga power project expansion. 

Mr Anil Ambani, Managing Director, Reliance Industries, said the company is 
waiting for the State Government's decision regarding independent power 
producers (IPPs) and also how the reforms in the power sector shape up.

"They (Government) are also saying that the State would not need the power. 
In any case, there is provision in our power purchase agreement (PPA) with 
MSEB to sell power outside," Mr Ambani said. 

Asked if Reliance is interested in taking over the Dabhol Power Company 
(DPC), he merely said the company has an open mind. "Enron is still running 
DPC. They are our partners in oil exploration. We look at value propositions 
as and when they arise. We have an open mind," he said. 

The 447-MW, LNG-based Patalganga project had run into trouble when the 
Maharashtra State Electricity Board (MSEB) declined to provide escrow cover 
citing financial constraints. The project, which is yet to achieve financial 
close, is awaiting the Government's decision on the matter. 

The Energy Review Committee headed by Dr Madhav Godbole, had recommended in 
its interim report that all PPAs with IPPs be deferred and they also be made 
public. 

"Neither of the two IPPs - Reliance Patalganga and Ispat Bhadravati - are 
today contractually structured to meet the needs of intermediate and peaking 
load in either MSEB or Maharashtra... allowing these IPPs to proceed, as 
currently structured, will only result in a problem similar to DPC re- 
emerging in future. Therefore, the panel recommends that MSEB defer all PPAs 
with IPPs and re-examine them in accordance with a Least-Cost Plan and, in 
any case till such time the demand levels in the State permit, full 
absorption of power generation from such IPPs," the panel had observed. 
- Our Bureau


 

Enron imbroglio not to affect ADB loans for India
Our Economy Bureau New Delhi

05/01/2001
Business Standard 
2
Copyright (c) Business Standard 
The Asian Development Bank has said the Enron saga will not affect its 
assistance to power sector reforms in India. 

The bank which finalised the details of its country lending programme for 
India today in consultation with the finance ministry, will continue with its 
support to power sector reforms in Madhya Pradesh and Gujarat.

Senior programmes officer Klaus Gerhausser, who deals with the India 
portfolio for ADB told reporters, that they have considered "all material 
aspects including tariffs, models and reforms for finalising the details of 
the loan programme" for each state.  Gerhausser said ADB has finalised a $1.6 
billion country loan programme for India in the current year, which makes the 
country the largest borrower from ADB. This includes a $500 million package 
for Gujarat earthquake relief.


 
Loss-wary FIs ask govt to defuse Dabhol crisis
Tamal Bandyopadhyay Mumbai

05/01/2001
Business Standard 
1
Copyright (c) Business Standard 

Indian lenders to Dabhol Power Company (DPC), led by the Industrial Deve- 
lopment Bank of India (IDBI), have asked the Centre to honour its 
counter-guarantee and pay Rs 102 crore for the December 2000 bill 
immediately, to end the impasse over the $3 billion Dabhol Power Company 
(DPC) project in Maharashtra. 

In a letter to finance secretary Ajit Kumar despatched on Saturday, the 
domestic lenders said the Centre must immediately step in to defuse the 
crisis and save them from posting irreparable losses if Enron walks out of 
the project.

This is possibly the first instance of onshore lenders moving the finance 
ministry to save a project. "This is unprecedented. As a last-ditch attempt 
the financial institutions are putting pressure on the Centre to save the 
project and their money," said a source in the ministry. 

The lenders suspect that DPC may eventually declare itself bankrupt as the 
company had hinted at roping in a bankruptcy lawyer at last week's meeting in 
London against the backdrop of the Maharashtra State Electricity Board (MSEB) 
having defaulted on its payments. 

"The MSEB's payment of Rs 134 crore `under protest' has not helped its cause 
much as DPC will classify the payment as a `contingent liability' in its 
balance sheet and may declare itself insolvent if MSEB continues to pay up 
this way," pointed out an institutional source. At the London meeting, the 
"bankruptcy law" issue was raised, even though DPC did not clearly spell out 
its future course of action on this. 

The Indian lenders persuaded DPC not to go ahead with its proposal to 
terminate the power purchase agreement (PPA) against the stiff resistance of 
the foreign lenders. But they have merely bought a three-week reprieve.  "In 
case the issues are not sorted out within three weeks, the situation may 
worsen as the EPC contractor Bechtel may pull out if DPC fails to pay up. The 
EPC contractor may serve the pull out notice in June. The government must 
resolve these issues on a war-footing," said another source familiar with 
developments. 

The lenders' letter to the finance ministry has listed a host of issues, 
ranging from the delay in giving technical clearance for pollution control to 
DPC, to honouring the Centre's as well as the Maharashtra government's 
counter-guarantees. It has categorically said if the project fails, both 
foreign and Indian lenders will take a hit.


USA: Enron buys Huntco's steel ops, makes supply deal.

05/01/2001
Reuters English News Service 
(C) Reuters Limited 2001. 
HOUSTON, April 30 (Reuters) - Enron Corp.'s Industrial Markets unit said on 
Monday it acquired Huntco Inc.'s cold rolling and certain coil pickling 
operations in Blytheville, Ark. 
The companies also signed a deal under which, over a 15-year period, Enron 
will provide inventory price risk management services and more than 600,000 
tons per year of hot-rolled, cold-rolled and galvanised steel products to 
Huntco Steel.
The agreements include the extension of a term loan from Enron to Huntco 
under transactions totalling $27.0 million. 
All transactions are slated to close on or before June 30, and are subject to 
satisfactory completion of Enron's due diligence and obtaining applicable 
consents and approvals. Further financial terms of the deals were not 
disclosed. 
Shares of Enron closed Monday at $62.72, Huntco closed at $1.10.

 

San Francisco-Based Financial Firm Executives To Assume Some of CEO's Duties
Deborah Lohse

05/01/2001
KRTBN Knight-Ridder Tribune Business News: San Jose Mercury News - California 
Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News; Source: World 
Reporter (TM) 
Three JP Morgan H&Q executives will help take over some of the duties of 
Chairman Daniel H. Case III, who recently relinquished his role as chief 
executive after surgery for a malignant brain tumor, the firm said Monday. 

Cristina Morgan, now co-director of investment banking at the San 
Francisco-based investment bank, will become vice chair of J.P. Morgan Chase 
& Co., the firm's New York-based parent. A top rainmaker with decades of 
experience in bringing small tech companies public, Morgan said her new 
duties will include counseling large companies about "the many trends and 
innovations we are seeing." She said she's already met with executives at 
Ford Motor, Bechtel and Enron.

David Golden, another investment-banking co-director, will become co-head of 
JPMorgan H&Q's global telecommunications, media and technology investment 
banking, along with Julie Richardson, an investment-banking managing 
director. 

Case -- whose brother is Steve Case, chairman of AOL Time Warner -- had the 
surgery March 23, a few weeks after diagnosis with the cancerous tumor. He 
plans to diminish his workload and focus on recovery, including radiation 
treatments, and on spending time with his family, said representatives of 
JPMorgan H&Q. The surgery was successful and Case has had no impairment to 
his speech or motor abilities, according to the company. 

The firm announced the appointments at its annual technology conference in 
San Francisco. The firm has not sent out news releases on Case's health, 
calling it a "sensitive, personal story" that isn't considered "material" by 
federal securities-law standards to J.P. Morgan Chase & Co. 

Case joined H&Q in 1981, when the firm was a little more than a decade old. 
He became co-CEO in 1992, at the age of 34. A former Princeton Phi Beta Kappa 
and Rhodes Scholar, he had never held a regular, full-time job at any place 
other than H&Q, and worked his way up through the ranks from the corporate 
underwriting department. The firm was bought by Chase Manhattan, which later 
bought J.P. Morgan, in 1999.


Jesse Jackson Opens Houston Project Office
David Kaplan

05/01/2001
Houston Chronicle - Texas
Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News; Source: World 
Reporter (TM)
Corporate America without the full participation of minorities is like 
baseball without Hank Aaron, Willie Mays and Bob Gibson. 
"We did not know how good baseball could be until everybody could play," 
civil rights activist Jesse Jackson said Monday in Houston, comparing the 
corporate world to the great American pastime.
Jackson was in town to mark the opening of the Texas bureau of the Wall 
Street Project, at 1600 Smith, as part of a national Rainbow/PUSH Coalition 
initiative to increase minority involvement in the corporate world. 
The Wall Street Project, which has 10 offices nationwide, lobbies 
corporations to hire more minorities, name more minorities to corporate 
boards and award more business to minority companies. 
In a matter of days, Jackson said, the project intends to purchase $2,000 
worth of stock in each of the 50 major energy companies, including Exxon 
Mobil Corp., Texaco, Enron Corp., Reliant Energy and Dynegy Corp. 
Begun in 1997, the Wall Street Project has offices in Chicago, Atlanta, 
Washington, D.C, Los Angeles, Detroit and New York. 
By securing the stock, Jackson said his group will help nurture the 
attainment of economic equity for minorities. Such an effort he said is the 
next phase of the civil rights movement. 
Jackson noted that most major energy companies have few minorities or women 
on their boards. By buying stock ownership, he said, those groups will have a 
greater voice in corporate decision making. 
"We will attend their meetings not as sharecroppers but as shareholders," he 
said. 
Within the past few years, labor and environmental groups have employed 
similar strategies. 
Joining Jackson in opening ceremonies at the Wall Street Project's offices 
were City Councilman Jew Don Boney and the project's local bureau chief, 
William-Paul Thomas.



Investing/MONEY 30
A Slamarama For The New Economy
Erica Garcia

05/01/2001
Money Magazine 
Time Inc. 
45
(Copyright 2001) 

Like the NASDAQ, the S&P 500 and even the less tech-dependent Dow, the MONEY 
30 was slammed during the month that ended March 14. Our index of stocks 
representing the New Economy fell almost 14%. The usual suspects--Motorola, 
Sun, Oracle, Cisco--all tumbled more than 20%. But it wasn't just tech that 
suffered. Charles Schwab--the biggest loser for the month-- plunged almost 
33% on news that online trading was slowing everywhere. Even mighty Enron, a 
steady climber, fell more than 20%. Another big loser was manufacturer Tyco 
International, which announced that it would buy finance company CIT 
Group--and saw its stock drop 24% for the month. 

There was one gainer: Mattel. The long-suffering toy company, which has been 
climbing since late January, added another 11% for the month after investors 
finally heard good news about the Learning Company, a troubled software 
company that Mattel sold to a buy-out firm in exchange for a share of future 
profits. Those profits may come sooner than expected.

--ERICA GARCIA 
THE MONEY 30 INDEX, WHICH TRACKS THE PERFORMANCE OF 30 BLUE-CHIP GROWTH 
STOCKS AT THE FOREFRONT OF TODAY'S ECONOMY, FELL 14%--TO 2846- -FROM FEB. 16 
TO MARCH 14. (JANUARY 1996 EQUALS 1000.) GO TO WWW.MONEY.COM FOR REGULAR 
PRICE UPDATES. 
[BOX] 

% total return P/E Revenue Company Price 1 month 1 year ratio (billions) 
American International Group (AIG) $75.70 -15.4% 32.7% 26.8 $42.0
Amgen (AMGN) 65.00 -12.4 24.4 53.5 3.6
AOL Time Warner (AOL) 40.04 -15.8 -35.0 32.6 36.0
AT&T (T) 22.42 -1.7 -56.3 61.3 66.0
Cisco Systems (CSCO) 20.25 -31.5 -69.3 33.1 24.0
Citigroup (C) 44.90 -19.0 21.9 14.5 93.0
Coca-Cola (KO) 47.67 -21.3 12.1 28.7 20.0
Colgate (CL) 55.47 -5.7 30.3 29.1 9.4
Disney (DIS) 27.09 -16.7 -19.6 29.4 26.0
Enron (ENE) 62.75 -21.2 -3.0 36.5 101.0
Fannie Mae (FNM) 74.65 -9.0 45.8 15.2 40.0
General Electric (GE) 41.03 -13.3 -1.7 27.5 130.0
Notes: Prices are as of March 14. P/E ratios are based on estimated fiscal 
year 2001 earnings. Revenues are for the latest 12 months. Source: Baseline.