The State Lockyer Fires Earthy Attack at Energy Exec
Los Angeles Times, 05/23/01

World Watch
The Wall Street Journal, 05/23/01

Consumer rights cited in petition with Texas PUC 
Houston Chronicle, 05/23/01

Enron to meet with Indian officials 
Houston Chronicle, 05/23/01

New Cynet president to administer change 
Houston Chronicle, 05/23/01

Enron, Indian goverment talks on power dispute put off
Associated Press Newswires, 05/23/01

Enron says Indian panel calls off power contract meeting, gives no explanation
AFX News, 05/23/01

Enron, Maharashtra Power Dispute Negotiator Resigns (Update4)
Bloomberg, 05/23/01

INDIA: Head of India state panel for Enron talks quits.
Reuters English News Service, 05/23/01

India Enron Negotiator Offers To Resign After Criticism
Dow Jones International News, 05/23/01

India Dabhol Pwr Co: Mtg With State Govt Panel Canceled
Dow Jones Energy Service, 05/23/01

INDIA PRESS: Dabhol Row To Cause INR30B Loss To Lenders
Dow Jones International News, 05/23/01

INDIAN CHIEF MINISTER URGES PANEL CHAIRMAN TO WITHDRAW RESIGNATION
Asia Pulse, 05/23/01

India: MSEB to pay Dabhol bill 'under protest'
Business Line (The Hindu), 05/23/01

US ENRON CORP PULLS OUT OF QATAR-UAE GAS PROJECT
Asia Pulse, 05/23/01

Maharashtra may terminate DPC's services
The Economic Times, 05/23/01

ASIA-PACIFIC: Enron may seek damages NEWS DIGEST 
Financial Times; May 23, 2001

Enron goes for valuation of businesses in India
Business Standard, 05/23/01

SEC Task Force Says Investors Need More 'Soft' Data
Dow Jones Business News, 05/22/01

BANDWIDTH BEAT: Video On Demand II May Have Happy Ending
Dow Jones Energy Service, 05/22/01

USA: FERC sets Thursday conference on Calif natgas problems.
Reuters English News Service, 05/22/01

Enron Hires Consultants to Value Business in India, Paper Says
Bloomberg, 05/22/01




California; Metro Desk
The State Lockyer Fires Earthy Attack at Energy Exec
JENIFER WARREN
TIMES STAFF WRITER

05/23/2001
Los Angeles Times
Home Edition
B-7
Copyright 2001 / The Times Mirror Company

SACRAMENTO -- In a dramatic escalation of energy crisis rhetoric, California 
Atty. Gen. Bill Lockyer this week suggested the chairman of a Houston-based 
power company should be locked in a prison cell with an amorous, tattooed 
inmate named Spike. 
Lockyer, who is investigating whether energy firms have manipulated prices on 
the wholesale electricity market, made the comment in an interview with the 
Wall Street Journal that appeared Tuesday.
"I would love to personally escort [Enron Corp. Chairman Kenneth] Lay to an 
8-by-10 cell that he could share with a tattooed dude who says, 'Hi my name 
is Spike, honey,' " Lockyer said. 
Enron spokesman Mark Palmer called the comment "counterproductive rhetoric" 
that "does not merit a response." 
But other industry representatives denounced the remark as "outrageous," 
especially because neither Lockyer's office nor any investigative panel has 
filed charges against Enron or other companies. 
"You'd expect that the state's chief legal counsel would file charges first 
and make public statements second," said Gary Ackerman of the Western Power 
Trading Forum, an association of energy producers and traders. "We're very 
disappointed with his choice of words, which don't exactly fit the profile of 
his office." 
In an interview Tuesday, Lockyer said he decided to "ratchet up" the 
commentary to "put [energy companies] on notice" that "we are not afraid of 
them and have the will to prosecute." 
"What I'm trying to do is let these economic buccaneers understand that if we 
catch them, they're going to be prosecuted," Lockyer said. "Just because 
they're multimillionaires and run big corporations, it doesn't provide them 
with immunity." 
The attorney general is investigating whether power company officials tried 
to maximize profits through illegal manipulation of prices on the wholesale 
energy market. Several panels, including a state Senate committee and the 
California Public Utilities Commission, are conducting similar probes. 
On Tuesday, Lockyer announced that three power companies have agreed to turn 
over documents subpoenaed months ago by his investigators. The attorney 
general went to court to obtain the documents after the companies failed to 
meet a March 19 deadline to hand them over. 
Lockyer said the forthcoming documents would help his office as it sifts 
through mountains of evidence in search of possible violations of antitrust 
or unfair business practice laws. 
"Evidence is accumulating that certainly infers illegal activity," Lockyer 
said. "But we need to make sure it's compelling and clear enough that you can 
convince a jury." 
Lockyer said he singled out Enron's chairman because the Houston company is 
the world's largest energy trader. 
At least one observer found Lockyer's comments refreshingly candid. Harry 
Snyder, a senior advocate of Consumers Union, said, "Let Lockyer be Lockyer." 
* 
Times staff writer Dan Morain contributed to this story.

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


International
World Watch
Compiled by David I. Oyama

05/23/2001
The Wall Street Journal
A21
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Enron Unit Threatened With India Fine 
An Indian state utility is planning to impose a second penalty of four 
billion rupees ($85 million) on U.S. energy company Enron's local unit, 
barely a week after Enron took its first step to pull out of the embattled 
power project. A Maharashtra State Electricity Board official said the fine 
on Dabhol Power would be for not meeting capacity targets within a stipulated 
period. Dabhol Power officials declined to comment. The MSEB earlier this 
year imposed a similar penalty on Dabhol, which it hasn't paid, saying its 
plant couldn't be ramped up to full capacity within three hours from a cold 
start. 

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







May 23, 2001, 4:38AM
Consumer rights cited in petition with Texas PUC 
By LAURA GOLDBERG 
Copyright 2001 Houston Chronicle 
Residential consumers switching power companies under a pilot deregulation 
program aren't being properly informed of their rights, four consumer groups 
said Tuesday. 




At issue is a document called "Your Rights as a Customer" that electric 
providers are required by the state Public Utility Commission to give 
consumers signing up to switch companies. 
The document must include information on a variety of topics, including 
filing complaints against providers, protection against unauthorized service 
switches, meter testing and privacy rights. 
Consumers Union, Texas Legal Services Center, Texas Ratepayers' Organization 
to Save Energy and the AARP Capital City Task Force for Deregulation of 
Electricity filed a petition Tuesday with the PUC. 
In it, they asked the PUC to require electric providers to fix their 
documents, to take any other action needed to clear up consumer confusion 
that may be occurring, and to develop a standard document format for 
providers to use. 
They also ask that the PUC's education campaign better inform consumers of 
their rights. 
Starting Jan. 1, when the Texas electricity market deregulates, all Texas 
consumers will be able to choose power providers. 
Before that, a limited number of consumers will be able to get power from new 
providers under the state's pilot program starting in July. 
Nearly 50,000 residential customers have signed up for the pilot, and 
thousands of slots are still open. 
That Texas consumers haven't had to shop for electricity presents a challenge 
to start with, said Janee Briesemeister, senior policy analyst with Consumers 
Union Southwest Regional Office. 
"And when the information that is given to consumers is confusing, they're at 
a further disadvantage," she said, adding that the PUC said it would adopt a 
standard format for the document and hasn't done so yet. 
Terry Hadley, a spokesman for the PUC, said the agency did promise a standard 
format for full competition, which starts in January. Officials hope to work 
with the consumer groups to address their concerns, he said. 
"It is yet another reason for the pilot project, so that we can get all these 
things done to everyone's satisfaction before the full roll-out come 
January," he said. 
The commissioners may discuss the petition at its open meeting Thursday. 
The consumer groups analyzed the "Your Rights as a Customer" documents being 
used by seven electric providers and concluded that none satisfied all the 
PUC disclosure requirements. 
Some try to put information in easy-to-understand language, while others 
don't, the groups said. 
The procedure to file complaints with electricity providers, and then with 
the PUC, are identical for all providers, the petition noted. 
"However, depending on which `Your Rights' document you read, the way the 
complaint process works and how you access it varies," it goes on to say. 
"Accessing and utilizing the customer complaint process should be 
straightforward and objective, not a riddle for consumers to solve." 
For example, the petition says, one provider doesn't explain an electric 
provider's responsibility to do an investigation and give the customer the 
results within 21 days, while another leaves out PUC important contact 
information and basics on what information is needed to file a complaint. 
The groups reviewed the "Your Rights" documents being given to consumers by 
following companies: Entergy Solutions, First Choice Power, Green Mountain 
Energy Co., The NewPower Co., Shell Energy and TXU Energy Services. All are 
vying for customers in Houston. The document of Reliant Energy Retail 
Services, which is marketing to customers outside Houston, was also included. 
Officials with Shell Energy, NewPower and First Choice said they were still 
reviewing the petition and couldn't comment on it, while TXU couldn't be 
reached. 
Green Mountain Power said it followed appropriate guidelines in creating its 
document but does support a standard format, while Shell said it would back 
anything that makes it easier for customers to understand their rights. 
"While Entergy Solutions is very confident that our document provides a 
complete picture of consumer protections, we agree that `Your Rights as a 
Customer' should be standardized," said Jim DeLong, Entergy's vice president 
of retail markets. 
Pat Hammond, a Reliant spokeswoman, said the company had already incorporated 
suggestions about its document made by PUC officials, who reviewed a draft. 
Most of the petition's comments relate to items that don't apply until full 
deregulation starts, Hammond said. 
While Reliant believes its document follows the rules, it plans to draft a 
new one for full deregulation. 








May 23, 2001
Houston Chronicle
Enron to meet with Indian officials 
BOMBAY, India -- The Indian subsidiary of Houston-based power concern Enron 
Corp. said Tuesday it would meet government officials for talks on a power 
supply dispute. 
"We look forward to hearing the proposed solutions ... particularly relating 
to creditworthy purchases for the power," said a statement from Dabhol Power 
Co., Enron's Indian unit. 
The statement comes two days after the company issued a preliminary notice to 
the Maharashtra State Electricity Board, a state-run utility, that it would 
stop supplying electricity if the government company continued to default on 
payments. 
Representatives from Houston-based Enron will meet today with officials from 
the utility, the federal government and Maharashtra, the western Indian state 
where the project is located. 
The electricity board has denied it defaulted on paying electricity bills to 
the power company that is setting up a $3 billion project in Maharashtra 
state. Electricity board officials said overdue December and January bills of 
$48 million should be offset against a fine of $85.31 million it imposed on 
Enron for not supplying power during the period. Enron disputes the fine. 
Politicians in Maharashtra say the cost of Dabhol power is too high and have 
called for renegotiating the tariff. Others have suggested selling power to 
nearby power-hungry states. 








May 23, 2001
Houston Chronicle
New Cynet president to administer change 
Executive plucked from vendor in Michigan 
By TOM FOWLER 
Copyright 2001 Houston Chronicle 
Houston company Cynet has chosen an executive from one of its vendors to lead 
it through a reorganization as its new president and chief operating officer. 
Robert Demyanovich, the founder of Michigan-based Mail2Media, a company Cynet 
planned to work with as a vendor, will take on the new posts to help the 
company reach profitability by early next year. 
"What caught our eye about him was his background in a part of our core 
business through fax and e-mail," said Sam Beale, vice president and general 
counsel for Cynet. 
Demyanovich will continue to have an advisory capacity with his prior 
company, but will move from Detroit to Houston to take on the Cynet position 
full time. 
Vincent Beale Sr., chairman and chief executive officer of Cynet, said 
Demyanovich will help the company focus on growing its two core products, 
global messaging software and wireless device technology. 
"He has already been instrumental in helping the company shape its revised 
business plan, along with aggressive cost reduction initiatives as the 
primary drivers in reaching profitability," Vincent Beale said. 
Part of the reorganization has included cutting its staff by about 60 
percent. Cynet has been steadily eliminating jobs since last winter, going 
from a high of about 125 workers to about 50. 
In February, Cynet also signed an agreement with AECsoftUSA to transfer all 
existing accounts through its Cynet Interactive service to AECsoft. In 
exchange, AECsoft would forgive outstanding amounts owed by Cynet. 
The company expects to take a one-time charge in the current quarter to 
account for the reorganization, but officials expect it to cut the quarterly 
cash burn rate from $2 million to cash flow positive by the first quarter of 
2002. 
Both the changing climate for technology companies and the failure of a deal 
to sell off part of the business to a French company fueled the 
reorganization. 
The technology market downturn that started last spring has made investors 
demand a clearer path to profit rather than simply revenue growth, the Beales 
said, meaning the company needed to slim down and focus on running 
efficiently. 
The company also saw a deal to sell its fax broadcasting business to I-Media 
Group of France fall apart when I-Media couldn't raise the $6.7 million 
negotiated in the deal. Instead, Cynet decided to integrate that technology 
back into its global messaging product, said Chief Financial Officer Greg 
Smith. 
The global messaging product line will now let businesses send out messages 
to thousands of recipients at once via fax, e-mail or voice messaging. 
With new technology that will be introduced by Cynet's relationship with 
Demyanovich, the software will also let a user design a message and send it 
via printed media, such as a letter through the mail. 
The company will also focus on its high-speed wireless technology offerings, 
such as an add-on to the Compaq iPaq Pocket PC that turns the hand-held 
digital assistant into a cell phone. 
When it went public in January 2000, Cynet became Houston's only 
African-American-managed publicly traded company. It has received financial 
backing from Enron and Compaq Computer Corp., which has an 8.9 percent stake 
in the company from an earlier $2 million investment and a recent loan. 




Enron, Indian goverment talks on power dispute put off

05/23/2001
Associated Press Newswires
Copyright 2001. The Associated Press. All Rights Reserved.

BOMBAY, India (AP) - Talks on a power supply dispute between government 
officials and the Indian subsidiary of the American energy company Enron were 
canceled Wednesday after the head of a negotiating panel resigned. 
Madhav Godbole, chairman of the panel of state and federal government 
officials and officers of a state power utility, resigned to protest a 
statement by a top politician that implied the panel had a "negative" 
attitude.
Sharad Pawar, leader of the Nationalist Congress Party that runs the 
Maharashtra state coalition government, told reporters late Tuesday that he 
did not foresee a positive resolution since the panel was headed by a person 
with "negative attitudes." 
Pawar, who did not name Godbole, later said his statement had been 
misinterpreted. He said he had merely stated that the panel needed to work 
with a more positive frame of mind. 
Representatives of Dabhol Power Co., Enron's Indian unit, were scheduled to 
meet the state-government appointed panel three days after the company issued 
a notice to stop supplying electricity if the Maharashtra State Electricity 
Board continued to default on payments. 
A new date for the next meeting has not yet been fixed. 
Godbole earlier headed a five-member committee that submitted a 198-page 
report last month to the state government recommending renegotiating a power 
supply agreement with Enron to lower prices. 
State government ministers have protested that the power supplied by phase 
one of Dabhol's two-year-old naphtha unit is "unaffordable." 
While Enron has demanded that the power utility, the Maharashtra State 
Electricity Board, make electricity payments on time, the board denies it is 
a defaulter. 
The board has asked that overdue December and January bills of dlrs 48 
million be offset against a fine of 4 billion rupees (dlrs 85.31 million) it 
slapped on Enron for not supplying power during the same period. Enron has 
refuted the fine. 
(rtb-ng-bdb-twx)

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


Enron says Indian panel calls off power contract meeting, gives no explanation

05/23/2001
AFX News
(c) 2001 by AFP-Extel News Ltd

NEW DELHI (AFX) - U.S.-based Enron Power Corp said a meeting with an Indian 
expert panel set up to renegotiate an electricity supply contract to 
Maharashtra state had suddenly been called off. 
"We went to attend the meeting and we were told the meeting was called off. 
We were not assigned any reason for that," a spokesman for Enron's Indian arm 
told Agence France-Presse.
jn For more information and to contact AFX: www.afxnews.com and 
www.afxpress.com

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


Enron, Maharashtra Power Dispute Negotiator Resigns (Update4)
2001-05-23 07:08 (New York)

Enron, Maharashtra Power Dispute Negotiator Resigns (Update4)

     (Adds Maharashtra chief minister's comments in third
section.)

     Mumbai, May 23 (Bloomberg) -- A negotiator trying to resolve
a payment dispute between Enron Corp. and India's Maharashtra
State Electricity Board resigned after being criticized for the
way he handled the talks, setting back hopes for a compromise.
     ``The meeting has been canceled because (Madhav) Godbole has
put in his papers,'' said Vinay Bansal, chairman of the
electricity board. ``It's not certain when the meeting will be
held again.''
     The meeting had been scheduled for 11 a.m. Mumbai time.
Dabhol on Saturday began a procedure to end its power supply
contract by serving a ``preliminary termination notice'' on the
electricity board because of unpaid electricity bills.
     India's federal and state governments, which have guaranteed
payments for power by the board and some of the loans to help fund
the project, may have to pay Dabhol more than 170 billion rupees
($3.6 billion) if it carries through termination of the 2,184
megawatt power venture.
     Dabhol is owed 3 billion rupees by the board for power
supplied in December and January. The board has refused to pay
because it said the bills should be lower to reflect a penalty
Dabhol should pay for failing to supply power at full capacity.
     Dabhol is 65 percent owned by Houston-based Enron, the
world's biggest energy trader.
     Godbole, a former chairman of the electricity board, was
criticized for his handling of the negotiations between Enron and
the electricity board.

                            Statements

     ``I have resigned because of statements made against me'' by
Sharad Pawar, leader of the Nationalist Congress Party in the
state's ruling coalition, Godbole said in an interview. The
decision to quit was ``well-considered,'' he said.
     The Economic Times quoted Pawar as saying ``a person with a
positive attitude should head the renegotiation panel. A
pessimistic disposition about Enron will further antagonize the
two parties.''
     Pawar was the state's chief minister when Enron first signed
the power supply agreement with the electricity board.
     Anti-Enron activists went to Godbole's residence in South
Mumbai to try to persuade him to return to the negotiating
committee, as they view him as a supporter of their cause.
     ``It's important to get him back,'' said Pradyumna Kaul, an
activist with Enron Virodhi Andolan, a non-governmental
organization opposed to the project. Still, he said Godbole's
resignation has helped focus attention on the need for a solution.

                         Press Conference

     At a press conference, Maharashtra Chief Minister Vilasrao
Deshmukh said the state government hasn't accepted Godbole's
resignation.
     ``We are going to ask him to start working again,'' he told
reporters. ``We'll clear all the misunderstandings.''
     Chhagan Bhujbal, deputy chief minister of the Maharashtra
government, and a member of the Nationalist Congress Party, said
his party supports Godbole.
     ``Let the state government's response come, and I will give
it a thought,'' Godbole said, when told of the comments at the
press conference.
     About ten days ago, three other members of the committee led
by Godbole, including Deepak Parekh, chairman of Housing
Development Finance Corp., India's biggest home mortgage lender,
quit citing personal reasons.
     The committee was set up by Maharashtra after Dabhol in April
authorized its Managing Director Wade Cline to cancel the power
supply contract.
     Enron has called on India's federal government to ensure a
resolution of the dispute.
     ``I am awaiting the return of the power minister who is
abroad,'' Finance Minister Yashwant Sinha told reporters in New
Delhi. Power Minister Suresh Prabhu was in France and is returning
later today.



INDIA: Head of India state panel for Enron talks quits.

05/23/2001
Reuters English News Service
(C) Reuters Limited 2001.

BOMBAY, May 23 (Reuters) - The head of an Indian panel examining ways to 
restructure U.S. energy giant Enron Corp's troubled power project resigned on 
Wednesday, dashing hopes of an early settlement of the dispute. 
Enron's $2.9 billion project in the western state of Maharashtra is widely 
seen as a test case for India's plans to privatise its power sector.
"I spoke to the chief minister (of Maharashtra) this morning and I have 
submitted my resignation to him," panel chief Madhav Godbole told Reuters. 
After months of wrangling over a payments dispute with the cash-strapped 
state electricity board, the Enron unit that runs the project, Dabhol Power 
Co, last Saturday issued a preliminary notice to terminate its contract to 
sell power to the utility. 
Godbole said he did not approve of a statement on Tuesday by Sharad Pawar, 
president of the National Congress Party (NCP), describing Godbole, a former 
bureaucrat, as having a negative approach. 
Pawar's NCP is a major ally of the coalition government that rules 
Maharashtra. 
A meeting between the panel and Enron's Dabhol Power Company scheduled for 
Wednesday has been cancelled, Godbole said. 
The negotiating panel was expected to look at cutting power tariffs as well 
as third-party sales if the state-run utility could not absorb the power 
generated by the power project, located at Dabhol, on India's west coast. 
Media reports on Wednesday quoted Pawar as saying the attitude of the 
renegotiating committee was a cause of concern. 
"If you have to renegotiate, you have to strengthen and not weaken the 
hands," Godbole said. "This way there is no productive work that can be 
done." 
Dabhol's termintion notice is widely seen as a first step by Houston-based 
Enron to pull out of the 21,84 MW power project. 
The project's 740 MW first phase has begun operation, and the 1,444 MW second 
phase is expected to be commissioned later this year. Dabhol Power Corp is 65 
percent owned by Enron.

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


India Enron Negotiator Offers To Resign After Criticism

05/23/2001
Dow Jones International News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

NEW DELHI -(Dow Jones)- Madhav Godbole, chairman of the committee appointed 
by the Maharashtra government to renegotiate the power purchase agreement 
with the Enron Corp.'s (ENE) Indian unit Dabhol Power Co. resigned from the 
panel Wednesday, according to Press Trust of India. 
"I have resigned due to the derogatory remarks made against me by Nationalist 
Congress Party Chief, Sharad Pawar, last night," Godbole told Press Trust.
He has sent his resignation to Maharashtra state Chief Minister Vilasrao 
Deshmukh, Press Trust reports. But Star TV said Deshmukh has asked Godbole to 
stay on. 
In an apparent criticism of Godbole, Pawar who is a member of the state 
coalition government, said last night he was apprehensive about the outcome 
of the renegotiations "as those leading the talks from the government side 
are working with a negative approach." 
Late Tuesday, Enron said it was prepared to meet government officials for 
talks scheduled Wednesday on a power supply dispute. 
"We look forward to hearing the proposed solutions... particularly relating 
to creditworthy purchases for the power," said a statement from Dabhol Power 
Co. 
The statement came two days after the company issued a preliminary notice to 
the Maharashtra State Electricity Board, a state-run utility, that it would 
stop supplying electricity if the government company continued to default on 
payments. 
Enron representatives were scheduled to meet officials from the western 
Indian state of Maharashtra, where the project is located, and federal 
government and MSEB officials Wednesday. 
The MSEB has denied it defaulted on paying electricity bills to the power 
company that is setting up a $3 billion project in Maharashtra state. MSEB 
officials said overdue December and January bills of $48 million should be 
offset against a fine of 4 billion rupees ($1=INR47.005) it imposed on Enron 
for not supplying power during the period. Enron disputes the fine. 
Politicians in Maharashtra say the cost of Dabhol power is too high and have 
called for renegotiating the tariff. Others have suggested selling power to 
nearby power-hungry states. 
Politicians complain Dabhol's costs have averaged more than INR4 as against 
INR1.8 per unit agreed in 1995 for the naphtha-generated electricity from the 
740-megawatt plant. 
The controversy erupted last year when prices shot up to INR7 per unit 
because of worldwide fluctuations of oil prices and depreciation of the rupee.

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


India Dabhol Pwr Co: Mtg With State Govt Panel Canceled

05/23/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

NEW DELHI -(Dow Jones)- Enron Corp.'s (ENE) Indian unit Dabhol Power Co. said 
Wednesday a meeting with the Maharashtra state government's expert panel - 
scheduled for 0530 GMT Wednesday - has been called off, spokesman Jimmy Mogal 
told Dow Jones Newswires. 
The aim of meeting was to renegotiate a power purchase agreement between DPC 
and the Maharastra State Electricity Board. 
"We went to the meeting today (Wednesday) but we were told the meeting had 
been called off. Although no official reason was given, we were given to 
understand that the chairman of the panel, Madhav Godbole, had resigned." 
Local press reports confirmed Godbole's resignation Wednesday. 
"I have resigned due to the derogatory remarks made against me by Nationalist 
Congress Party Chief, Sharad Pawar, last night," Godbole told the Press Trust 
of India. 
Mogal said Dabhol will be waiting to hear from the Maharashtra state 
government and the MSEB to determine its future course of action. 
He declined to say whether the DPC will participate in a meeting with the 
state panel if it was headed by a new chairman. 
"I would not comment on this issue now. Let the Maharashtra state government 
decide first on what they want to do next," Mogal said. 
Late Tuesday, Enron said it was prepared to meet government officials for 
talks scheduled Wednesday on the long-running power supply dispute. 
"We look forward to hearing the proposed solutions... particularly relating 
to creditworthy purchases for the power," said a statement from Dabhol Power 
Co. 
The statement came two days after the company issued a preliminary notice to 
the MSEB, a state-run utility, that it would stop supplying electricity if 
the government company continued to default on payments. 
The MSEB has denied it defaulted on paying electricity bills to the power 
company that is setting up a $3 billion project in Maharashtra state. 
MSEB officials said overdue December and January bills of $48 million should 
be offset against a fine of 4 billion rupees ($1=INR47.005) it imposed on 
Enron for not supplying power during the period. Enron disputes the fine. 
-By Himendra Kumar, Dow Jones Newswires; 91-11-461-9427; Himendra 
Kumar@dowjones.com

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


INDIA PRESS: Dabhol Row To Cause INR30B Loss To Lenders

05/23/2001
Dow Jones International News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

BOMBAY -(Dow Jones)- The three Indian lenders to the Dabhol Power Company - 
Industrial Development Bank of India, State Bank of India and ICICI - may 
take a loss of 30 billion rupees ($1=INR47.005) if the company decides to 
invoke the accelerable guarantee clause in the wake of the preliminary 
termination notice, the Business Standard reports. 
The clause says that the lenders will have to cover the loans should the 
project fail.
Also at stake is the lenders' INR22.5 billion in direct loans outstanding 
from the Dabhol Power Company, the Indian arm of Enron Corporation, the 
newspaper said. 
According to the newspaper, if the accelerable guarantee clause is invoked, 
the three Indian financial intermediaries will face a massive cash crunch. 
From phase 1 of Dabhol's project, the outstanding foreign loan from Exim of 
the U.S. for $221 million is backed by the guarantees of the three Indian 
lenders. 
The project has run into controversy with the Maharashtra government and the 
Maharashtra State Electricity Board over power supply dues. The power company 
has threatened to withdraw from the massive power project, one of India's 
largest foreign direct investments. 

Web Site: www.business-standard.com 

-By Bombay Bureau, Dow Jones Newswires; 
91-22 2884211;djn.bombay@dowjones.com -0- 23/05/01 04-44G

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


INDIAN CHIEF MINISTER URGES PANEL CHAIRMAN TO WITHDRAW RESIGNATION

05/23/2001
Asia Pulse
(c) Copyright 2001 Asia Pulse PTE Ltd.

MUMBAI, May 23 Asia Pulse - The Chief Minister of the western state of 
Maharashtra, Vilas Rao Deshmukh, today appealed to Madhav Godbole to withdraw 
his resignation from chairmanship of the committee set up for negotiating the 
power purchase agreement (PPA) with the Enron-promoted Dabhol Power Company 
(DPC). 
Godbole, former federal Home Secretary, submitted his resignation to the 
chief minister this morning after an adverse comment made against him by the 
Nationalist Congress Party president Sharad Pawar at a public function last 
night.
"Godbole's in-depth knowledge and experience makes him indispensible for 
handling vexed issues such as renegotiation with the US energy giant," 
Deshmukh told PTI. 
"I am requesting on behalf of Maharshtra government that he reconsider his 
decision to resign," he added. 
In an apparent criticism of Godbole, Pawar had said, he was "apprehensive of 
the outcome of the discussions with Enron as those leading the talks from the 
government side are working with a negative approach". 
(PTI) 23-05 1751

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


India: MSEB to pay Dabhol bill 'under protest'

05/23/2001
Business Line (The Hindu)
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - 
Asia Intelligence Wire

MUMBAI, May 22. THE Maharashtra State Electricity Board will pay Dabhol Power 
Company's April bill on May 25 "under protest". "We will pay DPC Rs 137 crore 
under protest unless Enron takes any step to jeopardise the situation," a 
senior MSEB official said. 
The two companies will come face-to-face at the negotiating table on 
Wednesday.
According to the official, the board will pay the bill "under protest" 
because DPC refused to adjust the rebate slapped on MSEB in its earlier 
bills. 
"We had asked them (DPC) to carry out corrections in their February bill when 
we had slapped the penalty. We had asked them to show the shortfall in 
supplying power to MSEB, for which we charged them the rebate, in their 
earlier bills. But DPC did not do so," the official said. 
The board plans to charge DPC for the shortfall in supply for February and 
May. The rebate is calculated once in four months and the last couple of 
defaults in supply will be charged at the end of this month, he said. 
"There is a cap on the rebate amount we can charge so the amount may not 
exceed Rs 400 crore," the official said. MSEB had earlier slapped a rebate of 
Rs 401 crore on DPC for shortfall in power supply on January 28. 
"Although we are paying the April bill under protest, we hope that DPC will 
make the required corrections in the May bill which is due on June 5," the 
official said. 
Enron keen on Dabhol: Meanwhile, according to sources, Enron is keen on 
continuing with the Dabhol power project and would like its lenders to 
continue disbursements, in spite of beginning the termination process. 
They said some lenders are also of the view that since it is more than 90 per 
cent complete, it makes more sense to finish the project. 
Lenders had stopped disbursement of funds to the project some time early this 
year following the dispute between DPC and MSEB. 
Indian lenders had consistently maintained that they preferred going ahead 
with DPC. They had also succeeded at a London meeting last month to persuade 
all lenders to not consent to terminating the project. 
It was, however, the foreign lenders' will that prevailed ultimately, and 
they gave their consent last week to invalidate the power purchase agreement 
with MSEB. 
DPC today confirmed that it would be present at the Godbole Committee meeting 
on Wednesday. DPC's stand is also being viewed by Indian lenders as a 
"positive" development after the pre-termination notice being served. 
DPC said in a release issued here, "consistent with our traditional practice 
of being open to discussions with MSEB, State Government and the Centre, we 
confirm that DPC will be represented at the Godbole panel meeting tomorrow. 
We look forward to hearing the proposed solutions from the committee, 
particularly related to creditworthy purchasers for the power. In addition, 
we are extremely interested in the Centre's attendance and learning of their 
expected role." The Central Government representative, Mr A.V. Gokak, was not 
present at the last meeting as he was "appointed at too short a notice". DPC 
had cited it as the Centre's unwillingness to take any "positive" role in the 
process. 
Our Bureau

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


US ENRON CORP PULLS OUT OF QATAR-UAE GAS PROJECT

05/23/2001
Asia Pulse
(c) Copyright 2001 Asia Pulse PTE Ltd.

ABU DHABI, May 23 Asia Pulse - US Enron Corp. has bowed out from a US$500 
million phase of a US$6-US$S8 billion project to route Qatari gas to the 
United Arab Emirates and has sold its 24.5 per cent stake in Dolphin Energy 
Ltd (DEL) to UAE Offsets Group (UOG) for an undisclosed amount, regional 
newspapers including Oman Observer report today. 
Reuters reported that a senior Enron official for the Middle East explained 
at a press conference that Enron was not suited to a project that had evolved 
into a major upstream venture.
Last week, the Middle East Economic Digest reported that the profit margin 
for Enron would be low and that other partners in the project regarded the 
company's estimated cost for constructing and laying pipeline as too high. 
TotalElfFina is reported to be interested in increasing its 24.5 per cent 
stake in the project although DEL Chairman Ahmed Ali Al Sayegh emphasised 
that DEL would seek another partner in the project. 
Qatar sits on the world's third largest gas reserves. 
(ONA) 23-05 1431

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


Maharashtra may terminate DPC's services
Girish Kuber

05/23/2001
The Economic Times
Copyright (C) 2001 The Economic Times; Source: World Reporter (TM)

MUMBAI 
THE DABHOL Power Company is likely to be served with a primary termination 
notice from the Maharashtra government.
Senior officials of the state's energy department and the Maharashtra State 
Electricity Board on Tuesday, separately, held a series of meetings with 
Maharashtra's Advocate-General to decide their strategy. 
"This is certainly the first option we are looking at to tackle the situation 
after the Enron served a PTN to MSEB," sources from the state's energy 
minister said. 
The state government and MSEB will issue a primary termination notice to DPC 
if Enron refuses to change its stand and 'non-cooperation' with the Godbole 
panel continues. "This could be the only option left with us to face the 
crisis," said sources. 
The decision to issue the termination notice will be arrived at only after a 
meeting of the Godbole panel on Wednesday. The meet will also be attended by 
A V Gokak, the Centre's nominee on the Godbole panel. 
This will be the first meeting being held after DPC issued the notice and 
also the first in which a Centres's nominee will be present. 
Meanwhile, changing its earlier stand, US energy major Enron, DPC's promoter, 
has also decided to attend the meet. 
Enron said it was looking forward to "hearing proposed solutions from the 
Godbole panel particularly related to credit-worthy purchasers for the 
power". 
An Enron spokesman said they were "specially interested in the Centre's 
presence and learning of their expected role".

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


		

		
		

		
		ASIA-PACIFIC: Enron may seek damages NEWS DIGEST 
Financial Times; May 23, 2001
By JULIE EARLE

		Enron may seek damages 
		Enron, the US power company, warned yesterday it would move to recoup 
significant termination damages if it was unable to settle a dispute over 
unpaid bills with the Maharashtra State Electricity Board (MSEB). It is 
understood that Enron would seek damages of Dollars 3.5bn (Pounds 2.4bn) to 
Dollars 5bn (Pounds 3.4bn). 
		It has a 65 per cent stake in the Dabhol Power Company (DPC), which operates 
the Bombay plant that has supplied the MSEB. Julie Earle, New York For 
regional reports, www.ft.com/asiapacific 
		Copyright: The Financial Times Limited

		
		

Enron goes for valuation of businesses in India
P Vaidyanathan Iyer & Parul Gupta NEW DELHI

05/23/2001
Business Standard
1
Copyright (c) Business Standard

In a move which may be a prelude to Enron's complete exit from India, the 
company has appointed Arthur Andersen and Jones Lang La Salle to undertake a 
valuation exercise of all its businesses in the country, including the 
controversial Dabhol Power Company. While Jones Lang La Salle will assess all 
the real estate investments of Enron in India, Arthur Andersen will value the 
business worth of the Houston-based energy major's Indian set-up.
When contacted, a company spokesperson declined to comment. "Nobody in Enron 
will talk about it," he said. However, sour- ces said the appointment of 
consultants was in line with Enron's strategic decision of pulling out of the 
2,144 mw power venture which has been mired in controversy from day one. 
According to sources, Enron's real estate investments have taken a big hit. 
"Enron invested in prime real estate during 1992-1995 when the prices were at 
a peak. However, they have touched more realistic levels now," said a real 
estate consultant. Jones Lang La Salle is, however, tight-lipped about such a 
mandate from Enron. Meanwhile, sour- ces said that Cushman & Wakefield which 
had earlier finalised certain real estate investments for Enron was also in 
the race. CB Richard Ellis has also proposed certain clients to Enron for 
buying/leasing some of its property. Enron's Houston-based president Jeffrey 
Skilling had in February said in an interview to Business Week that Enron 
"should not be in there (India) building $2 billion power plants. Our cost of 
capital is too high for that." DPC had disregarded the contents of the 
Godbole Committee report when it issued a preliminary termination notice to 
MSEB on May 19. The PTN gives DPC, MSEB, the state government and the Centre 
six months to resolve the issue amicably. If the talks fail, DPC would issue 
the final termination notice. Enron India had earlier this year also decided 
to abandon the proposed joint venture with MSEB and Global Telesystems for a 
broadband network in Maharashtra.

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



SEC Task Force Says Investors Need More 'Soft' Data
By Judith Burns

05/22/2001
Dow Jones Business News
(Copyright (c) 2001, Dow Jones & Company, Inc.)

Dow Jones Newswires 
WASHINGTON -- A new Securities and Exchange Commission task-force report 
calls for an overhaul of federal accounting rules, saying financial 
statements don't reflect the true value of public companies.
"At a time when our stock markets loom so large in the economy, we need to 
close large gaps in the quality of information that companies disclose," said 
task-force chairman Jeffrey Garten, dean of Yale University's School of 
Management. 
The task force wants to close the gaps by providing investors with so-called 
soft data, such as intangible assets, that don't appear on corporate balance 
sheets. 
Any information that helps investors assess future corporate profits and cash 
flow "should be encouraged" by regulators and accountants, the task force 
said in a report issued Tuesday. It stopped short of saying regulators should 
require companies to divulge such information, but suggested protecting firms 
from litigation as long as they report truthfully. 
"Soft" data such as financial information about a company's business model, 
competition, intangible assets and operating performance measures is likely 
to become increasingly valuable, the task force predicted. Indeed, it said 
markets are likely to penalize companies that don't voluntarily provide such 
results. 
Intangible assets such as patents, technology licenses, customer lists, 
business alliances, brand-name recognition and a highly skilled work force 
aren't given sufficient recognition under current accounting rules, the task 
force concluded. 
Industry performance measures such as revenue per customer, inventory 
turnover, order backlogs, and speed at introducing new products to market 
also get short shrift under existing accounting rules, the task force added. 
The report suggests lawmakers encourage companies to disclose this data 
without fear of being sued, provided the information is clearly labeled and 
the company doesn't intend to deceive. 
"Intangible assets may seem esoteric, yet they are the reasons why many 
companies attract investments in this information age," said House Financial 
Services Committee chairman Michael Oxley, an Ohio Republican. In a 
statement, Mr. Oxley said he supports voluntary disclosure of off-balance 
sheet items such as intangibles, saying it will give investors "more accurate 
information on which to base their financial decisions." 
SEC officials had no immediate comment on the task-force recommendations. 
Former SEC chairman Arthur Levitt asked Mr. Garten to create the task force 
in October 1999, focusing on whether corporate financial reports provide 
enough information to investors. 
The group concluded that current disclosure, based on generally accepted 
accounting principles, or GAAP, and quarterly and annual reports required by 
the SEC, produces backward-looking documents showing past transactions that 
offer little help for understanding where the company is headed in the 
future. 
To spur companies to provide more forward-looking information, the group 
rejected the idea of more regulation, saying "a far better approach" would be 
to make it easier and safer for companies to disclose information beyond what 
appears in standard financial statements. 
Adopting standard rules for reporting "soft" results would be difficult since 
much of the missing information is specific to particular industries or 
companies, the report noted, and rapid changes in economic and business 
models would quickly make new rules out of date. 
Mr. Garten's group acknowledged that without rules in place, companies might 
tend to skew soft financial results, reporting only those that show the 
company in a favorable light, or calculating them in a nonstandard way that 
makes comparisons impossible. But the group said there is an easy fix to such 
problems, asserting "market forces will penalize companies that provide 
inadequate information relative to their peers." 
The task force includes venture capitalist John Doerr; Rob Glaser, chairman 
and CEO of RealNetworks Inc. (RNWK); Enron Chairman Kenneth Lay; investment 
banker Peter Peterson; Cisco Systems Inc. (CSCO) controller Dennis Powell; 
Professor Baruch Lev of New York University; Professor Joseph Stiglitz of 
Stanford University; and Hal Varian, dean of the University of 
California-Berkeley's School of Information Management and Systems. 
Write to Judith Burns at judith.burns@dowjones.com 
Copyright (c) 2001 Dow Jones & Company, Inc. 
All Rights Reserved

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


BANDWIDTH BEAT: Video On Demand II May Have Happy Ending
By Michael Rieke
Of DOW JONES NEWSWIRES

05/22/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

HOUSTON -(Dow Jones)- The prospects for video on demand took a blow in March, 
when a deal between Enron Corp. (ENE) and Blockbuster Inc. (BBI) fell apart. 
The split not only broke up a partnership of giants in their fields, but also 
revealed some of the inherent difficulties in getting the business going.
Nevertheless, transcontinental telecommunications networks like Williams 
Communications Group (WCG) and Global Crossing (GX), as well as major studios 
and even utilities, are still interested in providing the service. Once the 
hurdles are cleared, video on demand has a shot at producing significant 
revenue. Jason Bazinet, a senior research analyst in Internet infrastructure 
services for J.P Morgan Securities, estimates the market could surpass $1.5 
billion in revenue by 2005, with two-thirds of that growth in 2004 and 2005. 
"We'll be ready," said Greg Onyszchuk, a vice president at Williams' Vyvx 
Broadband Media unit. "And I don't think we'll be the only network ready." 
The Blockbuster-Enron team-up sounded like a great idea when the two 
companies announced it. Blockbuster is known for having videotapes of just 
about every movie you'd want to see. Enron, always an innovator, promised to 
move the videos across its long-haul fiber-optic network to local phone 
companies, like SBC Communications Inc. (SBC), which would deliver them to 
homes. 
But there were problems. Blockbuster said Enron's network couldn't deliver 
the quality needed for transmitting the large video files. And Enron said 
Blockbuster, whose agreements with movie studios only cover videos rented 
through its stores, couldn't deliver the content. 
Those shortcomings point to the significant hurdles that remain before video 
on demand, also called VOD, can be made viable. Studios Want In 

As Blockbuster learned, major motion picture studios want a bigger piece of 
the VOD action, and they're interested in cutting out middlemen between 
themselves and viewers at home. Clearing that hurdle is trickier than it 
sounds, even without getting into antitrust issues. 
Interest by the studios is more rumored than publicly discussed. Still, 
Onyszchuk believes all the major studios have VOD initiatives under way, 
because they're already getting big revenues through rentals. 
Individual studios can't pull it off on their own. The 20 to 25 most popular 
movies account for a huge percentage of video rentals at any given time, 
Onyszchuk said. Even two studios working together would still probably have 
only seven to 10 of the Top 25 pictures, which isn't enough. 
"If you want to be in the VOD business, you've got to have a current library 
of hits," he said. "You need most of them." 
Security is also a big issue for the studios, which want to be sure their 
movies aren't pirated from a transmission network. A software program called 
Divx is threatening to do for video what MP3 did for audio distribution via 
the Internet. Once pirated, a video file can be burned on to a DVD disk and 
distributed without paying royalties to the studios. 
Paying users bring their own hurdles: Motion picture studios aren't set up to 
handle billing and collection from subscribers. Retail End Underdeveloped 

Problems also exist on the other end of the fiber. To be profitable, the 
market needs 10 million to 20 million subscribers with high-speed Internet 
connections, Onyszchuk said. Those volumes won't really be in place for two 
years. Studies predict that 10 million homes will have high-speed connections 
by the end of the year, with 20 million connections expected in the next 
18-24 months. 
Storage is another issue. When Enron and Blockbuster tested their VOD 
service, movies were streamed directly from Los Angeles to individual homes. 
That system can work when a transmission network is uncongested. But 
long-haul transmission can develop glitches when there's heavy traffic on a 
network - like that created by, say, 20 million VOD customers. 
It makes more sense to have video files of movies in data storage centers in 
the top 125 cities in the country, Onyszchuk said. Then they would have to be 
transmitted only a few miles to local subscribers. But most data storage 
centers are designed to store Web pages, files of 5,000-10,000 bytes. Movies 
are much larger - 3 billion to 4 billion bytes. 
VOD calls for terabit storage (that's 1 trillion bytes) in metro areas, he 
said. Vyvx has a 100-terabyte data storage center in Tulsa, which Onyszchuk 
said could handle hundreds of movies. Companies like Exodus Communications 
(EXDS) and StorageNetworks Inc. (STOR) are deploying more data centers with 
terabyte storage capacity to handle expected demand for services like VOD and 
streaming video. 
Aggregation at either end of the long-haul transmission networks could help 
overcome some problems. 
Aggregation of content at the studio end would make most if not all popular 
movies available to subscribers. The model for VOD distribution would be 
companies like Blockbuster, which aggregate distribution rights for movies on 
video tape. 
Aggregation at the other end of the networks could bring all subscribers into 
the market whether they have high-speed cable-TV connections or high-speed 
digital subscriber lines from phone companies. 
Aggregation at the local level seems ideal for utilities that are getting 
into the telecom sector. They have the billing systems and most if not all 
the local customers needed to make the service work. 
Two utilities, Reliant Energy Inc. (REI) and Potomac Electric Power Co. 
(POM), have opened the door to future revenue from VOD. 
Reliant Energy Inc. has invested in Grande Communications, which provides 
Internet access, phone service and cable television. Potomac Electric and RCN 
Corp. (RCN) have a joint venture, StarPower Communications, which provides 
cable television service in the Washington, D.C., area. 
-By Michael Rieke, Dow Jones Newswires; 713-547-9207; michael.rieke@wsj.com

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


USA: FERC sets Thursday conference on Calif natgas problems.

05/22/2001
Reuters English News Service
(C) Reuters Limited 2001.

WASHINGTON, May 22 (Reuters) - Key players in the California power crisis 
will address the Federal Energy Regulatory Commission staff at a special 
conference on Thursday on the state's need for future natural gas supplies. 
Executives with Enron Corp , El Paso Corp , PG&E Corp's Pacific Gas & 
Electric , and Sempra Energy's Southern California Gas will make 
presentations at the conference, FERC said on Tuesday.
The companies are among two dozen utilities, pipelines, marketers, and state 
regulators scheduled to speak at the technical conference organized by FERC 
staffers. 
The technical conference will gather information and recommendations about 
California's future demand for natural gas, projected interstate pipeline 
capacity into California, interconnections between interstate and intrastate 
pipelines, and how the intrastate pipeline capacity is allocated. 
The conference will begin at 10 a.m. EDT (1400 GMT) on Thursday at FERC's 
headquarters in Washington, D.C. 
All participants were to submit copies of their presentations to FERC by 
Wednesday, and the agency said it would publish the documents on its Internet 
site. 
Energy-starved California is facing an estimated 260 hours of blackouts this 
summer, due in part to tight supplies of natural gas to fuel power plants. 
A public opinion survey released on Tuesday found that California residents 
are increasingly fearful of their state's energy crisis. Some 75 percent of 
the 1,015 adults surveyed said they viewed the energy problem as "very 
serious," up from 58 percent in January. 
More than half of those surveyed said they believed the energy crisis was an 
attempt by energy companies to boost prices, while one-third say they 
believed there was a genuine shortage of electricity.

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


Enron Hires Consultants to Value Business in India, Paper Says
2001-05-22 22:51 (New York)


     Mumbai, May 23 (Bloomberg) -- Enron Corp. appointed two
consultants to value its Indian assets and businesses, including
Dabhol Power Co., as a prelude to its exit from the country, the
Business Standard reported, without identifying sources.
     Enron appointed Arthur Andersen LLP and Jones Lang LaSalle
Inc., to value properties and overall business in the country, the
paper said.
     On Monday, Enron pulled out of a $2 billion pipeline project
in Qatar as it became increasingly likely that its Indian power-
sales agreement will collapse.
     Last week Dabhol Power, owned 65 percent by Enron, served a
preliminary termination notice on India's Maharashtra State
Electricity Board to stop supplying power because it's owed 3
billion rupees ($64 million) by the board.