As we discussed, based on this email and the other information you have given 
me, I have significant concerns about our ability to use the ENA products 
discussed below.  Having ENA IT people involved on an ongoing basis in 
maintaining the software and assisting us in using it would probably 
constitute a violation of the marketing affiliate rules or would at minimum 
create the appearance of marketing affiliate violations.  As I understand the 
risk books, etc., confidential information on our various capacity positions 
would be all over the place and difficult or impossible to firewall off from 
ENA people working on those books.  If there is some firewall strategy that 
the ENA folks have in mind, i.e., if those IT people are or will be employed 
by Networks or Corp., I am eager to listen, but from what I have learned so 
far, I am not comfortable with our use of the ENA system.  DF    




Lee Ferrell
11/16/2000 04:16 PM
To: Drew Fossum/ET&S/Enron@ENRON
cc: Kent Miller/ET&S/Enron@ENRON 

Subject: Risk System Alternatives Next Steps

We have been asked to justify our  proposal to purchase third party risk 
management software rather than use in-house ENA systems.  Since there are 
affiliate issues as addressed below, please give us your opinion of the risk 
we might run in trying to use ENA's systems.
---------------------- Forwarded by Lee Ferrell/ET&S/Enron on 11/16/2000 
03:28 PM ---------------------------


Lisa Sawyer
11/16/2000 01:48 PM
To: Lee Ferrell/ET&S/Enron@Enron
cc: Steve Hotte/Corp/Enron@ENRON, Vernon Mercaldo/ET&S/Enron@ENRON, Shelley 
Corman/ET&S/Enron@ENRON, Beth Perlman/HOU/ECT@ECT, Richard 
Burchfield/HOU/ECT@ECT, Stephen Stock/HOU/ECT@ECT 

Subject: Risk System Alternatives Next Steps

Lee,
Just to recap the meeting with Richard Burchfield and Steve Stock, based on 
the requirements that you and Vernon have identified, we would need to use 
several of the system components including TAG, ERMS, GLOBAL COUNTERPARTY, 
CREDIT, and UNIFY for settlements.  All of these applications are tightly 
integrated.  We considered moving them into the ETS environment which would 
separate the applications, but this would be a very large undertaking and 
would be a resource intensive effort.  Therefore, due to the size, complexity 
and integration of the applications, the group came to the conclusion that it 
would be more timely and cost effective from an inception as well as 
maintenance standpoint that ETS would have to share these systems with the 
marketing group, and that porting them to the ETS environment as separate 
application images would not be good from an overall migration as well as 
support standpoint.  Additionally, we considered the EnPower System which is 
also integrated into GLOBAL COUNTERPARTY, CREDIT and UNIFY.  We are planning 
on a demo Friday morning, but there may be some functionality that you all 
are looking for related to gas that EnPower cannot provide at this time and 
would require some customization.  We'll know more tomorrow after the demo.

Regarding security, these applications are secured to segregate the data, but 
we need an approval from Legal that it would be ok to use shared resources 
from the IT standpoint.  This would include application developers and 
database administrators.  Additionally, we would have to go through the 
process of verifying that there would be no security leaks where it would be 
possible for a marketer to run a report on pipeline related data, etc...  If 
we can get an ok from Legal regardinig sharing of resources, then one of 
these options can be explored further, but if we cannot get approval on 
sharing of resources, it doesn't look like porting either of these 
applications into the ETS environment as standalone apps would be the most 
timely or cost effective way to go at this time.  Can you get a stand from 
Legal regarding this issue?  Thanks.