I agree with you that par. 4 doesn't give NMNG anything beyond what the 
tariff and general contract law gave them.  The "subject to agreement by 
Transwestern" language is redundant since the previous clause says " by 
mutual written agreement."  Additionally, its confusing and innacurate 
because the "provided, however, that" clause isn't even binding if we 
mutually agree to eliminate it.   I therefore think we ought to take par. 4 
out, or at least remove the "provided however" clause.  I don't agree that we 
can only decrease their MDQ by using capacity release.  We can mutually agree 
to terminate their contract or reduce their MDQ without using cap. release.  
I suppose we would need to use cap. release if the termination or reduction 
of their MDQ was a sham designed to get the capacity from NMNG to another 
shipper, however. 

I would propose one change to Par. 3 just to make the discount more clear.  
The par. talks about primary delivery points but is silent on primary 
receipts.  I'd add this, after the words "Appendix A" at the end of the 
current first sentence:

"and receipts at the primary points of receipt set forth on Appendix A.  The 
discounted rate shall also apply to receipts at alternate receipt points in 
Transwestern's East of Thoreau (EOT) area."

I'm a fan of being extremely clear when we limit availability of discounts, 
and think we should always fully explain what the discount applies to at both 
the receipt and delivery end of the deal.  

Susan, please work with Christine to get these changes made.  I'd like to 
eliminate par. 4 entirely, but I can live with it if the business people want 
to leave it in, as long as we eliminate the "provided however" clause.   With 
these changes, I'm OK with the contract.  Thanks.  


   
	
	
	From:  Susan Scott                           01/24/2000 03:29 PM
	

To: Mary Kay Miller/ET&S/Enron@ENRON, Drew Fossum@ENRON, Mary 
Darveaux/ET&S/Enron@ENRON, Glen Hass/ET&S/Enron@ENRON
cc:  

Subject: Transwestern Contract Approval Request

The only problem I can see with this is that paragraph 4 could be construed 
to encourage NMNG to request amendment not only to increase the MAXDTQ but 
also to decrease it (if the MAXDTQ has been increased by a previous 
amendment).  I worry that this might mislead NMNG that the parties can 
decrease the MAXDTQ by agreement rather than NMNG using capacity release 
procedures.   However, the paragraph does not obligate TW to do anything & 
doesn't give NMNG any rights, since any change in the MAXDTQ must be by 
mutual agreement (and it's subject to available capacity).  Since it does not 
seem to give either party anything they do not already get under the tariff, 
I think I would recommend we omit it.  However, NMNG might insist on this or 
similar language to reflect the "deal" --- or at least the conversations of 
the parties.  If that's the case, I suppose I would advise the marketing 
folks to limit the language of paragraph 4 to an increase in MAXDTQ and 
explain that any decrease would have to be thru capacity release.  Comments?

---------------------- Forwarded by Susan Scott/ET&S/Enron on 01/24/2000 
03:10 PM ---------------------------


Christine Stokes
01/24/2000 11:15 AM
To: Susan Scott/ET&S/Enron@ENRON, Drew Fossum/ET&S/Enron@ENRON, Christine 
Stokes/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Glen 
Hass/ET&S/Enron@ENRON, Mary Darveaux/ET&S/Enron@ENRON, Mary Kay 
Miller/ET&S/Enron@ENRON, Bill Cordes/ET&S/Enron@ENRON
cc: Audrey Robertson/ET&S/Enron@ENRON 

Subject: Transwestern Contract Approval Request

TRANSWESTERN CONTRACT APPROVAL REQUEST


Please review the attached discount letter for New Mexico Natural Gas, Inc.  
(NMNG).   The contract's five year term provides for EOT-EOT receipts and 
deliveries at a $.05/Dth/day transportation rate.  The contract's MAXDQ 
varies by month and is show on the  Appendix A of the discount letter.

 Please indicate your approval via REPLY WITH HISTORY.
Officer approvals will be faxed to Bill Cordes for final Officer approval.
]