Joan,  The contract states that Wildhorse only has to accept gas from 
Crescendo that the downstream carriers will accept.  Per Brett Frie at 
Enogex, the Entrada production is 24% Nitrogen.  Until the plant is up and 
running, this gas will not meet any of the downstream carriers specs.  I am 
not sure how we get the Nitrogen out of the gas stream without the plant?  

The Dakota production was not mentioned in the letter, because I have no 
facts about the gas quality of this gas.  You had forwarded emails last week 
indicating the Dan Reineke was to take samples at the wellhead and downstream 
of Wildhorse's plant.  Once we have these facts we can send a letter 
concerning the Dakota.  Do you have any info on these samples?





	Joan Quick
	07/24/2000 07:17 PM
		
		 To: Gerald Nemec/HOU/ECT@ECT
		 cc: Scott Josey/Corp/Enron@ENRON, Barbara N Gray/HOU/ECT@ECT, Brian 
Redmond/HOU/ECT@ECT, Teresa G Bushman/HOU/ECT@ECT, Dan J Bump/DEN/ECT@ENRON
		 Subject: Wildhorse Letter


Per the drafts, we are asking "Wildhorse to accept all gas delivered.... upon 
startup of the Treating Plant."   I thought the purpose of this letter was to 
get Wildhorse to take all of our gas right now, not just after the plant is 
started up.  Is this not so?   I agree with Dan, that  this letter only 
discusses the Entrada gas, with no mention of the Dakota curtailment, which I 
think it should.

I had just a couple minor changes...





To: Gerald Nemec/HOU/ECT@ECT
cc: Joan Quick/HOU/ECT@ECT, Scott Josey/Corp/Enron@ENRON, Barbara Gray@ECT, 
Brian Redmond/HOU/ECT@ECT, Teresa G Bushman/HOU/ECT@ECT 
Subject: Re: Wildhorse Letter  

Gerald --

I have provided a few coments (redlined) to your draft letter attached below.

However, I wanted to offer the following ideas for discussion with you and 
the others listed above as to potential inclusion in the Wildhorse letter:

 A.  Should we request written notification from Wildhorse related to the 
shut-in status of Entrada production?  Should we request written notification 
related to the recent curtailment of Dakota production?  [As we've discussed, 
Enogex never requested anything in writing from Wildhorse, so we do not have 
any historic documentation of Wildhorse's claims].

 B.  Should we identify (potential) contractual issues due to the curtailment 
of Dakota production; e.g.  Sec. 6 detailing the (wellhead) delivery pressure 
requirements under this contract, et al?  [As we've discussed, the system 
pressures have increased due to (initially) gas being re-routed by Wildhorse 
over the past two years which has loaded the San Arroyo system, and now the 
NWPL quality issues and subsequent Wildhorse curtailments has increased 
pressures system-wide.  If Wildhorse based their ability to allow these 
problems to persist by referring to Sec. 7 "Gas Quality" of the agreement, 
what remedies can we request....partial release of Dakota gas?].

Here's the frustration, based on conversations with producers in the area and 
the documents we've received from Enogex, Wildhorse has continued to attach 
non-pipeline quality spec gas to their system over the past couple years to 
increase gathering revenues, yet has not invested any $$$ for processing of 
this gas to meet or exceed the specs of downstream pipelines.  Then, they use 
the downstream pipes as the reason for shutting in all their captive 
producers, and have thus far offered no solutions to the system pressure and 
quality issues discussed above.  Therefore, its critical that this letter 
gets to the "right" people within Wildhorse and, if possible, make reference 
to some element of timing (e.g., reasonable dispatch, commercially reasonable 
manner, etc.). 


Thanks.

Dan