Don, can you go through your Canadian gas book and let me know all the positions and customers.  We are planning on putting Enron Energy Services Canada into bankruptcy and need to understand the contracts.

Regards
Delainey

 -----Original Message-----
From: 	Kitagawa, Kyle  
Sent:	Thursday, December 13, 2001 5:42 PM
To:	Delainey, David W.; Milnthorp, Rob
Subject:	FW: Owens Corning Canada Positions

Dave

I asked Scott to figure out the exposure of EESC to its contracts because I am trying to figure a way to structure the sale of EDCC to maximize the value to Corp.  If these numbers are right ECC is going to take a big bath on its 7.5 M note to EESC.  In addition, we need to put EESC down because its just bleeding cash and is a burden to ECC.  I think we should do it tomorrow and give Owings the heads up.

Cheers
Kyle
 -----Original Message-----
From: 	Campbell, Scott T  
Sent:	Thursday, December 13, 2001 4:25 PM
To:	Kitagawa, Kyle; Keohane, Peter; Milnthorp, Rob; Flaman, Derek
Subject:	Owens Corning Canada Positions

Gentlemen,
I know this information is very relevant, so want to get it to you even though I am uncomfortable with some of my assumptions.  I have done the best I can to calculate OCC's position in Eastern Canada.  Phone calls to Houston have mostly gone unanswered, and the contract wording is unclear.  Based on my new found knowledge of power utility tariffs, I have some bad news.  A snapshot of my estimated NPV:

($2,000,000)  Owens Corning Gas Position - estimated by Brian Gillis last month (sale at Ontario burner tip at AECO Index + Cdn$1.73/GJ until Sept 30, 2009 while Nova, TCPL and LDC demand, commod & fuel climbs to over $2.40 by 2005.
($4,500,000)  Owens Corning Alberta Position (Sale of approx. 9 MWh until April 2005 at Cdn$28/MWh in a $40 market)
(2,500,000)  Owens Corning Ontario Position (Sale of approx. 18MWh until January 1, 2003 at Cdn$41.33/MWh in a $48 market)
($9,000,000)  Liquidated damages potential

This compares with EES Houston's estimate of a net gain of over US$14 million.  I feel comfortable with the information, but continue to phone Houston to have someone review my assumptions with them.  Also, I was provided a position summary from EES's risk group, and was provided a Quaker Oats power position.  I flipped out when I saw it, and am now chasing it down as well.  Their risk group claim it is in the money by $2.5 million, which probably means under water by a similar amount.


T. Scott Campbell
Director
Enron Energy Services Canada Corp.
9th Floor
645 - 7th Avenue S.W.
Calgary, AB T2P 4G8
phone 403-663-2832
fax 403-663-2899