Lorraine,

	Thanks for forwarding the attached message. The way I read this, PSNM is effectively withdrawing its demand for the collateral as long as we don't use the contract. We should probably send them a letter confirming that this is the case. I would suggest that you just send an e-mail in response stating that what PSNM has proposed is acceptable and that our understanding is that PSNM will not require collateral as long as we don't utilize the contract. Therefore, PSNM's demand for collateral by December 15 is, based on our understanding, withdrawn. Please let me know if you have any questions. Thanks. 

 -----Original Message-----
From: 	Lindberg, Lorraine  
Sent:	Wednesday, December 12, 2001 10:39 AM
To:	Rapp, Bill; Watson, Kimberly
Subject:	FW: Transwestern Off-system Transportation Contract T39817

FYI

 -----Original Message-----
From: 	McMurray, Lindsey [mailto:AMcMurr@pnm.com] 
Sent:	Wednesday, December 12, 2001 10:06 AM
To:	Lindberg, Lorraine
Cc:	Arreguin, Janette; Dopson, Karen; McFearin, Dan; Merville, Patricia; Thompson, Chuck  (GSC); Vigil, Anita
Subject:	Transwestern Off-system Transportation Contract T39817

I talked to my Supervisor and here is what we can do, PNMGS will not accept or confirm any nominations under Off-System Transportation Contract T39817.  This will put the Contract in an "INACTIVE" status instead of total Termination of the Contract.
Prior to any  future expectation of Off-system Transportation, pursuant to Contract T39817 between PNMGS and TWPC, there will then be an updated and current determination on the Financial Responsibility as set forth under ARTICLE XII. FINANCIAL RESPONSIBILITY.   PNMGS will then decide what, if any, steps will need to be taken prior to such Off-system Transportation.


A. Lindsey McMurray
PNM Gas Services
Senior Transportation Contract Rep.
505-241-2686
Cell 505-220-2662
Fax 505-241-2339