Lou, I agree with your legal analysis.  Susan confirmed for me that the TW 
tariff has no specific PCB limit and I think your analysis is accurate on how 
FERC or the courts would react to the  "toxic substances" language that is in 
there.  Please go ahead and get back to Bill and report your conclusions, 
with my endorsement if that adds any value (perhaps the value of another neck 
in the noose).  Also, it is worrysome that PG&E has an argument that any 
dollars they spend on Southwest must be reimbursed by TW under our 
agreement.  They might feel free to pour money on Southwest to keep them 
happy, even if Southwest doesn't put much pressure on PG&E and as a customer 
relationship strategy , in the belief that it is Enron money they are playing 
with.  Can we do anything to keep PG&E honest on this?  

Given all of the above,  is it our strategy to continue to manage this 
Southwest Gas problem as best we can as part of the broader PG&E problem?    



12/30/99 11:23 AM
Louis Soldano
Louis Soldano
Louis Soldano
12/30/99 11:23 AM
12/30/99 11:23 AM
To: Drew Fossum/ET&S/Enron@ENRON, Susan Scott/ET&S/Enron@ENRON
cc: Michel Nelson/ET&S/Enron@ENRON 

Subject: Re: PG&E Summary of events - 12/29/99 - Legal question

Bill raises some good questions.  I've been struggling with the "legal duty" 
question to SW Gas since we do not have a contract with SW - even PG&E does 
not have a contract with SW - PG&E's contract is with SoCal.   Without the 
contractual duty or a tariff requirement ( I don't believe our gas quality 
section would prohibit PCBs - even should they reach level that is regulated 
by the State of California or the EPA ) that sends us back to common law 
duties/causes of action - such as trespass, nuisance, and ordinary 
negligence.  Since PCBs are authorized by the EPA in natural gas pipelines at 
virtually any level as long as certain actions are taken I don't place much 
stock in the common law duties although the EPA's position would not be 
dispositive - merely heavily persuasive.  Other than some type of weak third 
party beneficiary claim is there anything here???

---------------------- Forwarded by Louis Soldano/ET&S/Enron on 12/30/99 
10:36 AM ---------------------------
   
	
	
	From:  Bill Cordes                           12/30/99 10:12 AM
	

To: Michel Nelson/ET&S/Enron@ENRON
cc: Phil Lowry/OTS/Enron@ENRON, Louis Soldano/ET&S/Enron@ENRON, Dave 
Schafer/ET&S/Enron@ENRON 

Subject: Re: PG&E Summary of events - 12/29/99  

I generally agree with the plan going forward, but before we finalize a SW 
Gas strategy, I want to know what our legal duties are to SW Gas if they find 
high PCB's. Is there an EPA requirement? Were any commitments made by TW to 
SW Gas in past years? Would they go after PG&E and, if so, would that fall 
under or commitment to PG&E to cover costs? Keep me in the loop and let's 
make sure we don't get any press on this until all facts are known and a 
communication plan is in place.

   Bill


   
	
	
	From:  Michel Nelson                           12/30/99 08:11 AM
	

To: Bill Cordes/ET&S/Enron@ENRON
cc: Phil Lowry/OTS/Enron@ENRON 

Subject: PG&E Summary of events - 12/29/99


FYI

Once E&C has developed plans to contain PCB's on the PG&E system, we will 
have to get approval for new 2000 Work Orders. I'm just guessing, but we will 
likely incur expenses of $2 to $3 million. This will be for decon work, for 
filter/separators on their system at customer taps, and probably some big 
filter/separators downstream on their A & B Lines. I'll work to find the $ 
from within the 2000 approved Capital limits.
---------------------- Forwarded by Michel Nelson/ET&S/Enron on 12/30/99 
08:01 AM ---------------------------

12/29/99 07:03 PM
Louis Soldano
Louis Soldano
Louis Soldano
12/29/99 07:03 PM
12/29/99 07:03 PM
To: Michel Nelson/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Lorraine 
Lindberg/ET&S/Enron@ENRON, Jeffery Fawcett/ET&S/Enron@ENRON, Kevin 
Hyatt/ET&S/Enron@Enron, David Roensch/ET&S/Enron@Enron, Rich 
Jolly/ET&S/Enron@Enron, Larry Campbell/ET&S/Enron@Enron, Earl 
Chanley/ET&S/Enron@ENRON, Eric Thode/OTS/Enron@ENRON
cc:  

Subject: PG&E Summary of events - 12/29/99

The following is an overview of the discussions that took place today and 
some excellent work by David and our field lads this evening:

Counsel for PG&E contacted Soldano to relay sampling results from last Friday 
testing on the line to SW Gas (five results- all in ug/100cm2) and all from 
internal surfaces on the equipment and short segment of pipe immediately 
upstream of the SW Gas line - ND, 2.4, 1,7, 5.7,2.5)  and to let TW know that 
PG&E and SW personnel would be conducting further sampling today on the SW 
system not far from the Topock C/S.  He was primarily calling to see how TW 
would respond to two questions that had not yet been posed but which may well 
come up soon - 1.) If SW Gas should request compensation/reimbursement for 
issues associated with PCBs what would be TW's response? and 2.) Would TW be 
interested in ensuring that PG&E and TW speak with as common a voice as 
possible and if so, how that might be accomplished.   Neither question was 
answered but PG&E was assured that TW would continue to work as closely as 
possible with PG&E to resolve any issues.  Possible joint phone conferences 
and meetings with SW were discussed including meeting tied to the planned 
meeting in Las Vegas on the 12th.  PG&E also stated that they were ordering a 
small PECO F/S for the SW Gas take off line which they expected to be in the 
$20,000 to $30,000 range

Our internal discussion afterwards suggested that we wait to see the 
analytical results of today's testing (probably due back on Tuesday of next 
week) before committing to any costs coverage issues and that Kevin Hyatt and 
Lorraine Lindberg would follow-up with Rod Boschee on Thursday on the "one 
voice" issue.  A meeting with SW Gas sometime around the 12th would likely be 
as quick a meeting as SW Gas could prepare for and it would be best if we had 
the sample results back before a meeting was scheduled.

David Roensch and the field crew were able to participate in the sampling 
event on the SW Gas system.  They tested some domestic meters which appeared 
in mint condition.  There were no liquids and from appearances alone, PCBs 
may not be present.  SW Gas had their environmental specialist on location 
and the entire SW Gas crew was reported in high spirits and quite friendly 
about the entire situation.