FYI...

Laura

 -----Original Message-----
From: 	Penman, Gregg  
Sent:	Monday, November 05, 2001 2:42 PM
To:	Johnson, Rudwell
Cc:	Tomaski, Richard; Luce, Laura
Subject:	Credit Issues

Rudwell - as you can probably imagine, we have had several counterparties with whom enovate has pending transactions that have initially claimed they will not accept Enron's credit as part of the transaction.  Below is a list of those counterparties to date:

Counterparty		Service				Term 					Total Value
Wisconsin Gas		10 day Storage Service			3 yrs (4/1/02 - 3/31/05)			$1,100,000
Wisconsin Gas		50 day Storage Service			3 yrs (4/1/02 - 3/31/05)			$3,375,000
Wisconsin Pub. Svc	5 day Storage Service			4 months (11/10/01 - 3/10/02)		$   240,000
TXU			Storage Service				1 yr (4/1/02 - 3/31/03)			$   990,000

We are also in the process of negotiating transactions with several other counterparties including Oneok, PG&E, and PanCanadian.  They have not yet raised credit concerns.  

It is obviously imperative that we keep business moving forward.  In that regard, what has our response been to such denials of credit?  Have we thought about posting L/C's or is that cost prohibitive?  We may have some flexibility with Peoples posting credit, but that has certain legal implications and is limited.  Also, three of the above deals do not start until April so we may have some flexibility with timing.  However, all of the above counterparties are anxious to put the contracting logistics behind them in case the deals fall through and they need to replace the service.

Any thoughts and assistance on this effort is greatly appreciated.

Gregg