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. 
---------------------- Forwarded by Drew Fossum/ET&S/Enron on 01/12/2000 
08:37 AM ---------------------------
   
	
	
	From:  Susan Scott                           01/11/2000 05:29 PM
	

To: Drew Fossum@ENRON
cc:  

Subject: Red Cedar

I regret to report that I just ended a very unproductive phone conversation 
with Mr. Hertzberg.  He thanked us for all our cooperation but politely 
declined to give me any information on what authority he was relying on to 
conclude that there is a jurisdictional problem.  However, it sounded to me 
like whatever authority he does have is shaky at best.  He also sounded 
interested in the possibility of our making some sort of anonymous inquiry at 
FERC (if such a thing is possible) on the issue.  Obviously they are very 
leery of making that phone call themselves and risking revealing their 
identity.  He said he would discuss it with Ed Meaders.  Also, he mentioned 
that after tomorrow he will be on vacation for a month, and another attorney 
will be taking over in his absence.  That could be good, or it could be bad.  
Maybe Lorraine can sweet talk Meaders into at least citing us some cases from 
Hertzberg's memo.  At the very least, I hope he will show it to the Kinder 
Morgan lawyers.