Is the formula for calculating transport cost:

cost of gas at receipt*(1-1/(1- fuel ratio)) + commodity charge?


----- Forwarded by Ann S. Chen/Internal/Accenture on 11/15/2001 12:12 PM
-----

            Ann S. Chen
                                         To:     Andrew.h.lewis@enron.com
            11/15/2001 11:44 AM          cc:
                                         Subject:     Calculating transportation per MMBtu




Andy --

I have a couple of questions as I dive more into the details of figuring
out transportation costs. Still trying to figure out how you make your
decision whether to transport or not.  You compare the cent spread between
the Amarillo(offer) and Chicago basis(bid)+Nicor Index(bid) versus the
transportation cost.  In the numbers you provided in your example, the
spread was 12 cents.  I'm still confused as to how you compute the
transportation cost to compare that spread with. The fuel ratio you
specified was 3.19% and the commodity was $0.0167.

Thanks,
Ann


----- Forwarded by Ann S. Chen/Internal/Accenture on 11/15/2001 11:31 AM
-----

            Ann S. Chen
                                         To:     Andrew.H.Lewis@enron.com
            11/14/2001 06:00 PM          cc:
                                         Subject:     Transportation Scenario Update




Hi Andy --

Thanks for helping us understand the tranportation and storage problem
today. We appreciate your patience. I know it's like teaching a baby how to
walk!

Anyway, just wanted to get you the updated numbers for the transportation
scenario, based on the changes you made at teh meeting today.  Can you also
double check with Philip regarding the issue with hedging Basis with
regards to transportation?

Have a great weekend!

Thanks!
Ann

(See attached file: Transportation.doc)




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 - Transportation.doc