Gerald,

This will confirm our telephone conversation of today's date.  As I
explained by phone, we are trying to obtain consistency of our Gas Supply
Agreements between the various operating subsidiaries of Xcel Energy Inc.,
including Cheyenne Light Fuel & Power and Public Service Company of
Colorado.  Currently, a GISB Style Agreement is in place between Enron
companies and each of the Northern States Power companies (MN and WI).
Enron has also executed a Spot Gas Purchase Agreement with Southwestern
Public Service Company, another operating subsidiary.  Each of these
agreements contain more detailed provisions to describe the agreement of the
parties than the Enfolio Firm General Terms and Conditions furnished for our
review.

In particular, our concerns with the Enfolio General Terms and Conditions
("GTC") include, but are not limited to, the following:

1.  Unlike the GISB style Agreement, the GTC contains no provisions to deal
with the possibility that a price will not be published for a particular
geographic location on any given day, except with respect to Default
situations under paragraph 2.  The GISB Agreement addresses that possibility
by incorporating the idea of using an average of previous day-next
succeeding day publication pricing in the event no published price is
available for the relevant gas day.

2.  The GTC includes netting of payments due from one party to another.
That is problematic for us from a regulatory perspective, as payment streams
for purchases made by the utility are passed through without markup to our
ratepayers, while accounting methods for any sales of gas by the utility
receive different treatment.  Neither the NSP GISBs nor the SPS Spot Gas
Purchase Agreement referred to above contain such netting provisions.

3.  The Force Majeure provisions under the GTC are not nearly as detailed as
those in our existing NSP and SPS agreements.

4.  The GTC has no written provisions for audit rights.  It appear to me
that the only contractual methodology for obtaining this information would
be through discovery in arbitration proceedings.  In contrast, our
agreements with Enron for the other operating utilities have written audit
provisions included therein.

5.  There are certain other provisions which we need to include in our
agreement (i.e. firm transactions, as opposed to interruptible delivery,
compliance with affirmative action statutes and regulatory provisions,
disclosure to regulatory bodies of contractual provisions, with request for
protective order regarding pricing, etc.). With the exception of firmness of
the transactions, the GTC does not seem as amenable to modification through
the inclusion of Special Provisions or amendments, as does the GISB to
address these concerns.

We understand that GISB, as originally crafted, does not deal with
transactions of longer than one month, however we believe the inclusion of
Special Provisions to negate that language, together with the inclusion of
"Early Termination" type provisions to address Enron's concerns upon the
occurrence of a "Triggering Event" would meet Enron's needs.  Alternatively,
we are willing to consider any alternative language that you may propose,
keeping in mind our desire to move toward more consistency of the agreements
between our various operating companies.

Please let me have your thoughts.  We would like to get signed agreements in
place prior to commencement of the Delivery Period.  As always, I look
forward to working with you to achieve that result.

Sincerely,

Alan Bransgrove
Manager, Contract Administration
Gas Acquisition & Trading
(303) 308-6172

> -----Original Message-----
> From:	Nemec, Gerald [SMTP:Gerald.Nemec@ENRON.com]
> Sent:	Monday, August 13, 2001 12:07 PM
> To:	alan.bransgrove@xemkt.com
> Cc:	Whitt, Mark; Perlingiere, Debra
> Subject:	FW: Enron GISB sent 4/5//01 Re: Northern States Power
> Minnesota;  Enf	olio confirms sent for PSCo and CLF&P
>
>
> Alan,  With respect to the Transactions for Cheyenne and Public Service
> Company, Enron prefers to use the Firm General Terms and Conditions as
> the Base Agreement for these deals.  These two transactions are 3 month
> firm deals.  The GISB is not set up for firm transactions longer than 1
> month in term.  There is no termination payment provision in a GISB and
> Enron requires this language for any firm deal.  Enron's general policy
> is not to use the GISB for any firm deal that is longer than 1 month. I
> would be happy to discuss this further at your convenience.  I can be
> reached at (713) 853-3512.
>
>
> >  -----Original Message-----
> > From: 	Perlingiere, Debra
> > Sent:	Friday, August 10, 2001 5:25 PM
> > To:	Nemec, Gerald
> > Subject:	FW: Enron GISB sent 4/5//01 Re: Northern States Power
> > Minnesota;  Enf	olio confirms sent for PSCo and CLF&P
> >
> >
> >
> >  -----Original Message-----
> > From: 	"Bransgrove. Alan" <Alan.Bransgrove@xemkt.com>@ENRON
> > [mailto:IMCEANOTES-+22Bransgrove+2E+20Alan+22+20+3CAlan+2EBransgrove+4
> > 0xemkt+2Ecom+3E+40ENRON@ENRON.com]
> > Sent:	Thursday, August 09, 2001 11:51 AM
> > To:	Perlingiere, Debra
> > Subject:	Enron GISB sent 4/5//01 Re: Northern States Power
> > Minnesota;  Enf	olio confirms sent for PSCo and CLF&P
> >
> >
> > Debra,
> >
> > I started to review the above-referenced GISB sent by you to Jeff
> > Spector on
> > April 5, 2001, and realized that we already have a GISB in place
> > between
> > NSP-MN and Enron Capital & Trade Resources.  Is it necessary to
> > prepare
> > another GISB with the Enron North America entity, or can there be an
> > assignment of the Enron Capital & Trade Resources Agmt.  Please
> > advise.
> >
> > In addition, I called you earlier this week and left a message
> > concerning
> > the Transaction confirmations you recently prepared for Public Service
> > Company of Colorado and Cheyenne Light Fuel and Power, which utilized
> > the
> > Enfolio General Terms and Conditions as the Base Agreement.  Our
> > preference
> > would be to instead structure these Transactions under GISB Agreements
> > with
> > each of these utilities.  Please advise if this is acceptable and, if
> > so, I
> > will prepare GISB Agreements, along with our Special Provisions page,
> > and
> > send them to you for review.
> >
> > I look forward to your reply.
> >
> > Alan Bransgrove
> > Manager, Contract Administration
> > Gas Acquisition & Trading
> > (303) 308-6172
> >
> > p.s.  I will be out of the office during the week of August 12th, but
> > will
> > check my voice mail periodically.
> >
> > AB
> >
>
>
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