Mary Kay -- This is a provision that is favorable to both TW and shippers in 
the context of risk management of index deals.  If their rates were anything 
other than pure index - to- index, then they would have an unbalanced cash 
flow and could be upside down.  This is the only real way these deals can 
work, and the only way the parties could have expected to do the deals.

-- Susan and Jeff


   
	
	
	From:  Mary Kay Miller                           01/11/2001 02:49 PM
	

To: Susan Scott/ET&S/Enron@ENRON
cc: Jeffery Fawcett/ET&S/Enron@ENRON, TK Lohman/ET&S/Enron@ENRON, Michelle 
Lokay/ET&S/Enron@Enron, Steven Harris/ET&S/Enron@ENRON, Drew Fossum@ENRON, 
Glen Hass/ET&S/Enron@ENRON, Mary Darveaux/ET&S/Enron@ENRON, Shelley 
Corman/ET&S/Enron@ENRON 

Subject: Re: revised language  

I just got done looking at the underlying contract language as set forth in 
the pro forma service agreement in the tariff and it specifically says that 
the max rate would apply unless a discount or negotiated rate has been agreed 
to.   My concern with adding the language below is,  could it be argued that 
not everyone knew the rate would or could apply at any point, since we just 
stated Topack and Needles and if they knew they might have bid a different 
rate?? 



Susan Scott
01/11/2001 02:42 PM
To: Jeffery Fawcett/ET&S/Enron@ENRON, TK Lohman/ET&S/Enron@ENRON, Michelle 
Lokay/ET&S/Enron@Enron
cc: Steven Harris/ET&S/Enron@ENRON, Drew Fossum@ENRON, Mary Kay 
Miller/ET&S/Enron@ENRON, Glen Hass/ET&S/Enron@ENRON 

Subject: revised language

After discussions with the commercial group I propose that that redlined 
language be added to the attached Dynegy agreement and to the 4 other 
negotiated rate agreements we've done.  If there are any objections you need 
to get back to me ASAP.