Thanks, Maria, this is very helpful.  I'm planning on drafting something this 
week for everyone's review.  Don't know if any other pipelines have tried to 
do anything similar but I'll find out.





Maria Pavlou
03/06/2000 04:39 PM
To: Drew Fossum/ET&S/Enron@ENRON
cc: Susan Scott/ET&S/Enron@ENRON 

Subject: Re: Gas Sales on TW?  

FYI a little more background:  

The Amgas relationship began as a result of TW's efforts to unbundle under 
Order No. 636, whereby we assigned gas purchase contracts to Amgas.  In 
addition, we had them administer certain remaining gas purchase contracts as 
well as our de minimus sales function.  All Amgas does today is administer 
our sales function.  We never eliminated our sales function; we just 
transferred the administration of it to Amgas.  

The marketing affiliate rule requires that a pipeline's sales division be 
treated as a functional equivalent of a marketing affiliate.   Our standards 
of conduct provide that the Vice President of Finance and Accounting is 
advised of pertinent sales activities by Amgas but does not participate in 
any of the day-to-day operations of Transwestern's merchant function.  As a 
result, the VP is not a shared operating employee under Standard G.  FTS-2 
transportation service is the unbundled no-notice transportation service the 
(former and current) sales customers received under Order No.  636.   I think 
we should be able to file revised standards saying that the merchant function 
is even smaller than it was when we unbundled [true?] which is not enough 
work for an agent to perform and that we've brought it back in house and 
explain why the person with the sales function responsibility is not a shared 
operating employee under G.   Maria 


   
	
	
	From:  Drew Fossum                           03/06/2000 11:02 AM
	

To: Susan Scott/ET&S/Enron@ENRON, Maria Pavlou/ET&S/Enron@ENRON
cc:  

Subject: Re: Gas Sales on TW?  

This sounds like a good candidate for a waiver application to FERC.  If we 
can save the $60,000/yr, it would be worth asking FERC for authority to 
simply use an ET&S market services person to administer the farm tap sales 
from time to time, without any functional separation or other junk.  We could 
even list the specific sales contracts we have so FERC would be comfortable 
that we are not going to expand the business.  The NN situation was different 
(I think) because NN had formally notified FERC that it was discontinuing use 
of its sales rate schedule.  Would TW use the FTS-2 rate schedule?  We have 
never formally discontinued the TW sales function, right?   What do you guys 
think about the likelihood that FERC would approve such a waiver?  Has it 
ever approved similar small-volume waivers?  DF   


   
	
	
	From:  Susan Scott                           03/02/2000 04:32 PM
	

To: Drew Fossum@ENRON, Mary Kay Miller/ET&S/Enron@ENRON, Dari Dornan@Enron
cc:  

Subject: Gas Sales on TW?

I've been asked to look into whether TW may administer its farm tap sales 
contracts directly or whether we need to continue to use AmGas.  TW no longer 
has any gas purchase contracts, just a handful of sales contracts to persons 
who granted rights of way to TW.  Many of these parties don't even buy gas on 
a regular basis, but they still have the contractual right to do so.  We pay 
AmGas around $60,000/year to administer the contracts.  The AmGas contract is 
terminable on 30 days notice.

I know that last year NNG re-established its pipeline sales division to make 
occasional gas sales and for other economic reasons (i.e. the base gas 
deal).  Do you think it would be worthwhile for TW to do the same?  Looks 
like NNG had an easy time getting its filing approved, but would like to hear 
from you what all was involved behind the scenes -- in other words, was it as 
easy as it looked?  

Another idea that Maria suggested would be to apply to the Commission to 
waive the Section 284.286 requirements in this instance since the remaining 
sales contracts are so few and insignificant. 

Your comments would be most appreciated!