I am ok with it for the spot deals.   Mark



	Michelle Blaine/ENRON@enronXgate
	03/16/2001 01:48 PM
		 
		 To: Mark E Haedicke/HOU/ECT@ECT
		 cc: John Novak/SA/Enron@Enron, Sami Arap/SA/Enron@Enron, Rob 
Walls/ENRON@enronXgate, Robert C Williams/ENRON@enronXgate
		 Subject: FW: arbitration for Brazilian PPAs

Hi Mark, 
Sami Arap, John Novak & I are in the process of developing a new matrix for 
arbitration in Brazil on certain types of trading contracts for your 
approval.   Until that is complete, however, Sami & John have identified the 
following spot market contracts as needing immediate approval for dispute 
resolution clauses agreeing to ICC administered arbitration in Sao Paulo or 
Rio.  As you are aware, this is somewhat contrary to our traditional policy 
for out of country ICC arbitration.  The counter parties in these 
transactions will not agree to arbitration outside Brazil.  Given the nature 
of these contracts, I believe ICC administered arbitration in Brazil is an 
acceptable means for dispute resolution.  I've discussed this with Rob and he 
is in agreement subject to your approval.
Regards,
Michelle


From:  Arap, Sami 
[mailto:IMCEAEX-_O=ENRON_OU=NA_CN=RECIPIENTS_CN=NOTESADDR_CN=8DA5AE3C-E6301033
-862568E0-To: 
Subject: arbitration for Brazilian PPAs
Importance: High

Michelle;

Our commercial guys are negotiating a number of PPAs in Brazil (spot market 
deals) and we need to close these deals before the Brazilian Wholesale Power 
Market (MAE) starts accounting and settling the long & short differences 
among all players (LDC's, Genco's, marketers etc).  There are deals which 
were "closed" last year ("closing" meaning that price, MWh volume, term, 
power profile, center of gravity etc were agreed upon between the contracting 
entities).  Some of these MWh's have already been physically traded but MAE 
haven't yet calculated the system's settlement.

Karla and I are currently working on the below listed deals:

Moema-2: 10-year PPA to purchase 8MW; PV of apprx US$5,130,000.; MTM value of 
US$1,200,000.
Sgu?rio: 2-year PPA to purchase 0.5MW; TBD
Furnas Collar: 2-year PPA to purchase 20-90-130MW (collar concept); PV of 
apprx US$37,696,000.; MTM value of US$12,534,000.
Cofepar: 15-year term to purchase 200MW; PV of apprx US$171,014,000.; MTM to 
be defined.
CSN: 14-month PPA to purchase 13.4MW (10,000MWh/month); PV of apprx 
US$5,865,000.; MTM value of US$786,000.
Eletropaulo Metropolitana: 60-day PPA to purchase 7,000MWh/month; TBD
Gerasul/Pactual: 24-month PPA to purchase 29,57MW; PV of apprx 
US$19,096,000.; MTM value of US$4,235,000.
CEMAT/Pactual: 13-month PPA to purchase 46MW; PV of apprx US$12,201,000.; MTM 
value of 6,107,000.
Celtins: 30-day PPA to sell 80MWh during peak hours; TBD
Cemat: 30-day PPA to sell 950MWh during off-peak hours; TBD
SINOP:  10-month PPA to purchase 8MW; PV of apprx US$8,850,000; MTM value of 
US$1,723,000.
AES Sul:  4-month PPA to purchase 33,6MW; PV of apprx US$2,470,000.; MTM 
value of US$866,000.

We are not (yet) working under "umbrella" type of agreements where Enron and 
the counterparty will execute a General Terms and Conditions (GTC) with 
several Annexes, each of them related to a specific deal.  Each contract is 
to be treated as one single deal. 
Some of the above listed deals are 1QTR commercial priorities and I need to 
know if you would be OK with Enron's Marketing Co (ECE) using 
ICC-administered or FIESP-administered (as a second alternative) arbitration 
under ICC Rules in S?o Paulo as the PPA's dispute resolution mechanism.  
Although I am schedule to meet with Tozzini, Freire this week, I doubt I will 
have time to get their legal opinion, discuss it internally, prepare a 
recommendation to Jim Derrick etc etc.  I've already talked to some of the 
counterparty's in-house counsellors and none of them is willing to accept 
offshore arbitration.  Our counterparties' position has been arbitration in 
Brazil under int'l rules OR local courts.

 

Rgds,

Sami