JAPAN: UPDATE 1-Enron says priority in Japan is electricity market.
Reuters English News Service, 10/31/00

Enron's Japan Unit To Offer "Elec Discount Pdt" Nov
Dow Jones Energy Service, 10/31/00

COMMODITIES & AGRICULTURE: US makes zinc stockpile awards NEWS DIGEST
Financial Times, Oct 31, 2000

Arena flier rouses ire of backers 
Letter attacks plan, mayor and Democrats 
Houston Chronicle, 10/31/00

AEP to Divide Its Assets Between Two New Companies (Update1)
Bloomberg, 10/31/00


JAPAN: UPDATE 1-Enron says priority in Japan is electricity market.

10/31/2000
Reuters English News Service
(C) Reuters Limited 2000.

TOKYO, Oct 31 (Reuters) - Enron Corp Chairman and Chief Executive Kenneth Lay 
said on Tuesday the Houston-based company's near-term priority in Japan was 
the electricity supply market, which is undergoing deregulation. 
"One of our highest priorities...in the next two or three years is 
electricity," Lay told a news conference.
Last year, Enron established its first Japanese venture, E Power, to try to 
break into Japan's electricity market that since March has allowed 
non-utility firms to supply power to large-lot industrial and commercial 
users. 
Japanese media have reported that Enron, North America's leading buyer and 
seller of electricity and natural gas, plans to build a coal-fired power 
plant in Fukuoka prefecture on the southern main island of Kyushu. 
Asked whether Enron planned to buy or build a power plant in Japan, Lay said 
the company believed there was surplus capacity in Japan on which it hoped to 
draw. 
"Our belief is, if anything, today there probably is surplus capacity both of 
generation and transmission capacity," Lay said. 
"It's not a matter that we are reluctant to buy or build assets," he said. 
"If the market has surplus capacity, there's not much reason to do that, at 
least initially." 
Enron also unveiled on Tuesday a package offering eligible electricity users 
three-to five-year electricity contracts that it says will reduce their 
electricity bills by up to 10 percent for the first year, with the 
possibility of further reductions for the remaining years of the contract. 
Several other foreign energy firms have also shown an interest in entering 
the Japanese market. 
These include U.S. oil major Texaco Inc , Vivendi SA and the Royal 
Dutch/Shell Group . 
None has started actually supplying electricity to large-lot consumers in 
Japan, however. Enron set up a second subsidiary in May, Enron Japan Corp, 
with the aim of seeking business opportunities other than electricity supply 
in Japan, mainly through EnronOnline. 
The Web-based EnronOnline trading system had, as of October 11, executed more 
than 350,000 transactions with a gross value of $183 billion on the system 
since it was launched in late 1999. 
Enron uses the online system to make markets in commodities such as pulp and 
paper, petrochemicals, metals and broadband capacity, in addition to gas and 
power.

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. 

Enron's Japan Unit To Offer "Elec Discount Pdt" Nov

10/31/2000
Dow Jones Energy Service
(Copyright (c) 2000, Dow Jones & Company, Inc.)

TOKYO -(Dow Jones)- Enron Corp. (ENE), the Houston-based energy and 
communications giant, said Tuesday its wholly-owned subsidiary Enron Japan 
Corp. will offer effective Nov. 1 an "electricity discount product" targeting 
Japan's high-volume large-lot power users, numbering 8,000. 
Joseph Hirl, Enron Japan's president and chief executive officer, told 
reporters that his company is "already working with a number of entities" to 
discuss power supply contracts.
Enron's package, which will typically run three to five years, will allow 
customers to "immediately" cut up to 10% in their current electricity costs 
for the first year of the contracts, with the possibility of further 
reduction for the following years. 
In the first full year of the contract, Enron will pay a financial rebate of 
up to 10% to a customer on a kilowatt-hour basis, under the customers' 
existing power supply contracts with other power suppliers. 
Enron will pay a rebate in the first year but will not actually supply 
electricity. 
From the second year onward, Enron will supply actual electricity to the 
customer at agreed fixed prices. 
Under the government's partial deregulation implemented March 21, high-volume 
large-lot retail electricity consumers - which represent roughly 27% of 
Japan's total power demand - can now freely choose their power suppliers. 
Enron declined to elaborate on how it plans to secure electricity necessary 
for fulfilling the proposed contracts. 
Enron Corp.'s chairman and CEO Kenneth Lay, who was speaking at the same 
press conference, said the company's highest priority in the Japanese market 
for the next two to three years will be electricity trading and marketing. 
Next comes trading in metals, weather derivatives and pulp and paper, Lay 
said. 

In addition to those main focus areas, Enron Japan's Hirl said there is 
"tremendous potential" in areas such as liquefied natural gas, coal and 
foreign exchange trading. 
"We're looking to provide much services we can at the best price, and in many 
cases at lower prices, in most of the services we provide," Hirl said. 
Enron also plans to introduce broadband services in Japan. 
"For the next two to three years, establishing and extending our broadband 
network in Japan is a key part of our growth," said Kenneth Rice, chairman 
and CEO of Enron Broadband Services. 
Japan is a huge Internet market and it's also a logical foothold for Enron to 
extend its network into the rest of Asia, he said. 
By offering "EnronOnline" - the world's largest business-to-business 
electronic commerce platform, "Enron can help the Japanese economy become 
more efficient by significantly reducing the costs of many products and 
services," Lay said. 
-By Maki Aoto, Dow Jones Newswires; 813-5255-2929; maki.aoto@dowjones.com

Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. 


		COMMODITIES & AGRICULTURE: US makes zinc stockpile awards NEWS DIGEST
Financial Times, Oct 31, 2000, 45 words
US makes zinc stockpile awards 
		The US Defence National Stockpile Centre awarded about 26.6m lbs of zinc to 
three groups in its latest solicitation of offers. 
		Awards were made to Sogem USA, Enron Metals & Commodity Group and US Zinc for 
an approximate value of Dollars 15m. Reuters, New York 
		Copyright , The Financial Times Limited





Oct. 30, 2000, 9:50PM
HOUSTON CHRONICLE
Arena flier rouses ire of backers 
Letter attacks plan, mayor and Democrats 
By ERIC BERGER 
Copyright 2000 Houston Chronicle 
Arena proponents are decrying a letter circulating among area Republicans 
that ties the proposal to Houston Mayor Lee Brown and contains at least six 
factual errors. 
Brown, a central figure in the 1999 arena proposition that voters rejected, 
has had a considerably less visible role in this year's effort. Many 
Republicans viewed a vote against the arena last year as a vote against 
Brown, a Democrat, and an opportunity to embarrass him. 
"There are three areas where we believe Mayor Lee Brown's multimillion-dollar 
corporate welfare campaign must be addressed," states the letter, which was 
mailed to more than 500 Republicans and was sponsored by Republican precinct 
chairwoman Mary Jane Smith. 
What it fails to mention is that conservative U.S. Rep. Bill Archer, 
R-Houston, has endorsed the plan and that the pro-arena campaign chairmen are 
notable Republican fund-raisers Ken Lay and Don Jordan. 
"I suppose she believes that we've programmed Lay and Jordan to vote 
Democrat," said pro-arena campaign manager Dave Walden. "And that I spent a 
day hypnotizing Bill Archer." 
Beyond Brown, the letter also seeks to tie the pro-arena campaign to Vice 
President Al Gore, the Democratic presidential candidate. 
"They have teamed up with Democrat activists and Mayor Lee P. Brown to 
connect arena and Gore voters," according to the letter. "Turn out a 
pro-arena vote and you turn out a Gore vote." 
Such questionable associations -- Lay, for example, is one of Republican 
presidential candidate Gov. George W. Bush's closest business advisers -- 
offer a vivid look at how desperate arena opponents are, Walden contends. 
This criticism failed to stymie Smith, who plans to send out another printing 
of the letter this week. "All of my Republican buddies are opposed to this," 
she said. "I think it's kind of funny the arena people are taking the 
attitude of `How dare anyone question us?' " 
The letter, which clearly targets Brown, further suggests that "what Houston 
lacks is world-class leaders" who would have negotiated a tougher deal with 
Houston Rockets owner Leslie Alexander. 
"Mayor Lee Brown won't fund the immunization of Houston's poor Hispanic 
children, but he is able to build a parking garage benefiting a handful of 
multimillionaires," the letter says. 
Walden called that statement racist. 
It is also inaccurate, as the city is not building the parking garage. A 
group of private business leaders, headed by Lay, will lend the Harris 
County-Houston Sports Authority $30 million for the garage. The sports 
authority, and its hotel and car rental tax revenues, are not affiliated with 
the city. 
Among other errors in the letter: 
? "The ballot language does NOT rule out ... the usual cost overruns." This 
is irrelevant because the Houston Rockets pay construction cost overruns. 
? "Taxpayers fund and build the arena garage with Les Alexander reaping ALL 
of the parking fees." The private, interest-free loan will help the sports 
authority finance the garage. To help repay the loan, the sports authority 
will collect parking fees during the daytime and at concerts and other events 
that don't involve Alexander's Rockets, Comets and ThunderBears. 
? Although the city gets use of the arena for 20 dates a year, the letter 
says that only five days may be leased for revenue. In fact, all 20 dates may 
be used for fund-raisers. This was clarified in changes to the letter of 
agreement between the Rockets and the sports authority. 
? "This year's ballot language gives an incredible $200 million to the 
Rockets for naming rights, while the city receives less than 10 percent." 
Under terms of the agreement, the Rockets may sell the naming rights to the 
arena, but it is unlikely the team would receive $200 million. Such a payment 
is not guaranteed by the ballot language. The city receives 5 percent of the 
revenue from the sale of the naming rights. 
? "Today, Houston is building the Hobby Arts Center, again, with no public 
funding. If we can use private funding for the arts, why can't our sports 
owners fund their own projects?" Actually, the city donated land appraised at 
$35 million for the Hobby Center for the Performing Arts, and gave another 
$30 million in hotel taxes toward its construction. The city also gives $8 
million annually to the Cultural Arts Council of Houston, a $3.5 million 
subsidy to the Wortham Center and a $1.5 million subsidy to Jones Hall. 


	


AEP to Divide Its Assets Between Two New Companies (Update1)
10/30/0 18:40 (New York)

AEP to Divide Its Assets Between Two New Companies (Update1)

     (Adds company, analyst comments starting in fourth
paragraph.)

     San Francisco, Oct. 30 (Bloomberg) -- American Electric Power
Co., a Columbus, Ohio-based owner of utilities in 11 U.S. states
and Europe, said it will split its regulated utilities from its
less-regulated businesses, creating two wholly owned companies.
     The company also said it has ruled out merging Seeboard Plc,
a natural gas and power distributor it owns in England, with
Yorkshire Electricity Plc, a U.K. utility partly owned by AEP.
     The separation of its businesses is patterned on plans it has
already filed in Ohio and Texas, AEP said. Earlier this year, the
company was required to separate all or most of its power plants
and assets from its transmission lines and related assets in those
states as part of efforts to open the Ohio and Texas markets to
competition.
     The separation will take about a year to complete, said E.
Linn Draper Jr., AEP's chairman, president and chief executive
officer. Once it is completed, AEP will have the option of
spinning off one of the two companies.
     ``We will have options of IPO, spin-off, divestiture,''
Draper told analysts at the Edison Electric Institute conference
in San Francisco.
     As deregulation is approved in other states, AEP said, it
plans to move all of its transmission system into the company that
runs its regulated utilities, which will continue to have fixed
rates of return set by regulators, and move its power plants into
the company that runs less-regulated businesses with more
opportunities for growth.
     ``I think it's the best way for them to organize such a big
company,'' said PaineWebber Inc. analyst Barry Abramson, who has a
``neutral'' rating on AEP. ``It'll focus better attention on the
growth business, not the slower-growing distribution business.''

                       `Undervalued' Shares

     Draper told analysts that part of the reason for the
restructuring is to raise the value of the company's shares by
more clearly showing the performance of its better-performing
generation, wholesale marketing and trading businesses.
     ``We are very unhappy about the stock price,'' Draper said.
``We think it is significantly undervalued.''
     The wholesale power business -- the buying and selling of
power between utilities and other large consumers and generators -
- is already deregulated.
     ``We have no plans to expand our distribution business either
in the United States or internationally,'' Draper said.
     AEP said it will file its restructuring plan with the U.S.
Securities and Exchange Commission sometime this week and complete
the separation by the end of 2001, in line with the deregulation
timetable in Texas and other states it serves.
     AEP completed the $10 billion acquisition of Central & South
West Corp. in June, creating a utility with 5 million customers.
Seeboard and the stake in Yorkshire came with the purchase.
     In February, then-Central & Southwest President Tom Shockley,
now AEP vice chairman, discussed the possibility of merging
Seeboard and Yorkshire. U.K. utilities have been squeezed recently
by taxes and regulated price cuts.
     Combining those businesses provided no major cost savings,
Draper said today.
     ``We think that keeping them separate gives us options,'' he
said. ``It simply made better sense to keep our options open.''
     AEP owns more than 38,000 megawatts of generation. About
25,000 megawatts of the company's generation will be deregulated
by the end of 2001. AEP also is the No. 2 power trader and
marketer after Enron Corp.
     Shares of Columbus, Ohio-based AEP rose $1.88 to $41.81.

--Margot Habiby mhabiby@bloomberg.net, and Daniel Taub
dtaub@bloomberg.net in San Francisco/alp/pkc

Story illustration: To compare AEP's earnings and shares
performance with other utilities, see {AEP US <Equity> RV <Go>}.