California Cites Generators For Withholding Documents
The New York Times, 06/29/01

Senate Panel Lashes Out at 2 Energy Firms Hearings: Lawmakers hold Enron and 
Mirant in contempt for refusing to help in pricing probe.
Los Angeles Times, 06/29/01

Calif Panel Cites Power Cos For Withholding Documents
Dow Jones Energy Service, 06/29/01

California Senate committee cites power companies for contempt for 
withholding documents
Associated Press Newswires, 06/29/01

INDIA: Buyers seek price cut from Enron India unit-paper.
Reuters English News Service, 06/29/01

Fibernet upbeat on European progress
The Independent - London, 06/29/01

ANOTHER US ENERGY CO MAY GET INVOLVED IN INDIAN DABHOL PROJECT
Asia Pulse, 06/29/01

India: States willing to buy only 700 MW surplus from DPC
Business Line (The Hindu), 06/29/01

ENRON GROUP DEVISES $US50MLN INDIA OILFIELD EXPANSION PLAN
Asia Pulse, 06/29/01

Enron held in contempt in California 
Houston Chronicle, 06/29/01

Duke Energy to buy Enron power plant
Houston Chronicle, 06/29/01

USA: Calif. Senate panel cites generators for contempt.
Reuters English News Service, 06/28/01

Enron, Mirant Held in Contempt by Calif. Senate Panel (Update2)
Bloomberg, 06/28/01

Duke Energy Agrees to Buy Mississippi Power Plant From Enron
Bloomberg, 06/28/01

U.S. Power Suppliers' Second-Quarter Profits to Rise (Update1)
Bloomberg, 06/28/01





National Desk; Section A
California Cites Generators For Withholding Documents
By LAURA M. HOLSON

06/29/2001
The New York Times
Page 18, Column 5
c. 2001 New York Times Company

SACRAMENTO, June 28 -- California legislators turned up the heat on power 
generating companies today, citing two of them for not handing over documents 
necessary in the state's continuing hearings on the spike in electricity 
prices. 
A special legislative panel, called the Senate Select Committee to 
Investigate Market Manipulation, unanimously passed a contempt motion this 
afternoon saying that the Mirant Corporation, based in Atlanta, and the Enron 
Corporation, based in Houston, had failed to respond to a June 11 subpoena 
asking for documents.
The motion comes as the committee is trying to follow the paper trails to 
determine if power generating companies willfully manipulated the supply of 
electricity here last year in an effort to drive up prices. Several state 
agencies are investigating similar charges. 
Other companies, including Reliant Energy and Dynegy Inc., complied with the 
committee's requests for thousands of documents related to power sales and 
bidding procedures. Several other companies, which include the Williams 
Companies, the Duke Energy Corporation, the AES Corporation and NRG Energy 
Inc., are expected to hand over documents in two weeks. 
California's two largest utilities have racked up $14 billion in debt, 
forcing one to file for bankruptcy protection. Last week, three former 
employees of Duke Energy told the committee that they observed behavior that 
they believed was consistent with market manipulation. Duke denied the 
charge, saying there was no merit to the accusations. 
The chairman of the select committee, Joseph Dunn, a Democrat, said that if 
Enron and Mirant complied with the request by July 10, the contempt order 
would be expunged. ''We were not seeking to find contempt but to obtain 
compliance,'' he said today. ''Unfortunately, we had to find contempt.'' 
The documents were subpoenaed earlier this month by the Senate Rules 
Committee to obtain details on bidding, pricing and other aspects of power 
sales. The power companies have said that they have not complied because they 
have not been able to negotiate an acceptable confidentiality agreement. 
By seeking the contempt citations, the committee needs the full Senate to 
follow through. There are no set penalties, said Laurence Drivon, the 
committee's special counsel, adding that by law, ''the Senate can take such 
action as it deems necessary and appropriate.'' 
Patrick Dorinson, a spokesman for Mirant, said the company was seeking 
assurances that any information it handed over, which it considered 
proprietary, not be made public. He said the company had been negotiating 
with the committee up until today and hoped to resolve its concerns in the 
next few days. 
For Enron's part, a representative of that company sent a letter to Mr. Dunn 
outlining its objections to turning over documents. Michael Kirby, a San 
Diego lawyer, wrote that the documents the committee wanted were outside the 
state and thus out of the jurisdiction of the California subpoena. He also 
wrote that the committee was asking the company to reproduce documents that 
other state regulatory agencies already have. 
He called the subpoena's orders ''vague, unduly burdensome, often 
argumentative and beyond the scope and extent of both the subpoenaing party's 
legal and regulatory authority and subpoena power.'' 
Today's legislative action took place in an atmosphere of increasing attacks 
on the power generators. A poll by The Los Angeles Times this week found that 
86 percent of Californians interviewed believed that power companies had 
manipulated the electricity market in the state. 
Duke Energy, based in North Carolina, opened a campaign this week to do 
something about this widespread public view, taking out full-page newspaper 
advertisements in California to defend itself against accusations that it cut 
production to drive up profits.

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


California; Metro Desk
Senate Panel Lashes Out at 2 Energy Firms Hearings: Lawmakers hold Enron and 
Mirant in contempt for refusing to help in pricing probe.
CARL INGRAM
TIMES STAFF WRITER

06/29/2001
Los Angeles Times
Home Edition
B-1
Copyright 2001 / The Times Mirror Company

SACRAMENTO -- Angered by the refusal of electricity wholesalers to surrender 
information about suspected price gouging, a Senate committee voted Thursday 
to hold two big energy companies in contempt of the Legislature. 
It was uncertain what punishment, if any, may be in store for Enron Corp. of 
Houston and Mirant Corp. of Atlanta. But committee members said potential 
sanctions could include heavy fines and/or the jailing of corporate 
executives.
"Jailing of an individual is an option and we intend to preserve all our 
options," warned state Sen. Joe Dunn (D-Santa Ana), chairman of the committee 
investigating whether the wholesalers had manipulated the market. 
"Could we impose, say, $9 billion in fines?" Sen. Debra Bowen (D-Marina del 
Rey) asked rhetorically. 
Enron reacted angrily. "This is a shakedown," charged spokesman Mark Palmer. 
"And if this is a shakedown, we're going to protect our legal rights." 
Enron had further enraged the committee by sending a letter saying the 
legislative panel had no authority to conduct its investigation because 
wholesale prices were the "exclusive jurisdiction" of the Federal Energy 
Regulatory Commission. 
A spokesman for Mirant said the company intends to keep talking to the 
committee to reach an agreement. 
The bipartisan committee had been prepared to find eight generators--mostly 
out-of-state companies--in contempt for refusing to produce the subpoenaed 
records. But by the end of the four-hour hearing, companies that said they 
would cooperate--AES, Duke, Dynergy, NRG, Reliant and Williams--escaped a 
citation, at least temporarily. 
Though the committee found Enron and Mirant in contempt, its action is 
subject to ratification by the full Senate. 
Dunn said contempt citations are so rare there are few guidelines to follow 
in determining a punishment. He said it "could be anything that the Senate 
believes is necessary and reasonable." 
The finding of contempt for failure to obey a legislative subpoena is rarely 
used in California. Sources said it last was done in 1929 when an officer of 
a cement company refused to cooperate in a price-fixing investigation. 
Late in 2000 and earlier this year, the profits of major electricity 
wholesalers soared astronomically, throwing the state's two biggest 
utilities, Pacific Gas and Electric Co. and Southern California Edison Co., 
into financial chaos. Edison is teetering on bankruptcy and PG&E is in 
Bankruptcy Court. 
The committee, which first asked the companies to provide the information 
voluntarily in April, encountered strong resistance from the energy 
companies. They complained that their trade secrets might be exposed to 
competitors, the public and government regulators. 
Frustrated, the committee two weeks ago issued subpoenas demanding the 
information, including whether the power sellers had destroyed any records. 
The committee set Thursday as the deadline for compliance and threatened to 
find violators in contempt, a tactic that appeared to turn around all but 
Enron and Mirant. 
"Let's move forward. We want to facilitate your investigation," said Duke 
attorney Joel Kleinman of Washington, whose company had objected to its 
subpoena. 
At the last minute, several sellers began sending urgent fax letters or 
witnesses to Dunn. Dunn said a quick scan of the letters showed wholesalers 
were pleading for a second chance and assuring that the subpoenaed data would 
be forthcoming. 
Kleinman told the committee Duke did not want to be held in contempt. 
"We will make tens of thousands of documents available for inspection," 
Kleinman said. 
But he said Duke and the committee staff still must settle on a 
confidentiality agreement, a matter he indicated was close to resolution. 
Other wholesalers appeared to fall into line. 
Dunn said he was concerned that "minor problems" in reaching a 
confidentiality agreement might become a tactic for further delay. 
The committee gave the six companies until July 10 to reach confidentiality 
agreements and turn over a vast assortment of records. 
The contempt finding against Mirant and Enron would be abandoned if they, 
too, provided the confidential documents by July 10, when the committee will 
review the companies' compliance. 
The wholesalers also are the targets of similar investigations by Atty. Gen. 
Bill Lockyer and the state Public Utilities Commission. 
Times staff writer Nancy Vogel contributed to this story.

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




Calif Panel Cites Power Cos For Withholding Documents

06/29/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

SACRAMENTO, Calif. (AP)--A Senate committee investigating possible price 
manipulation in California's energy markets cited two power generators for 
not turning over documents requested for the probe. 
The documents - which include details on bidding, pricing and other aspects 
of power sales - had been requested in subpoenas issued earlier this month to 
Enron Corp. (ENE), Mirant Inc. (MIR) and four other generating companies.
On Thursday, the Senate Select Committee to Investigate Market Manipulation 
approved a contempt motion, citing Enron and Mirant for not producing the 
materials. The other four generators complied. 
The motion still needs approval by the full Senate. 
The Senate Rules Committee had subpoenaed the materials. 
Enron, based in Houston, said its documents are outside the committee's 
jurisdiction because they are kept in Texas. An attorney for Atlanta-based 
Mirant said the company wanted to comply, but didn't act quickly enough to 
avoid the contempt vote. 
California law doesn't specify penalties for a contempt finding, said 
Laurence Drivon, the committee's special counsel. "The Senate can take such 
action as it deems necessary and appropriate," he said. 
Enron's claim that the committee lacked jurisdiction outraged some senators, 
who said previous legislative investigations have sought documents from 
throughout the world. 
"If they've done nothing, if they've got nothing to hide, there's no reason" 
not to comply, said Sen. Debra Bowen. 
The committee has been negotiating with the companies to try to reach a 
confidentiality agreement for the release of the documents, and has asked the 
generators to sign agreements not to destroy any potentially relevant 
documents. 
So far, some companies have agreed verbally, but none has signed. 
Duke Energy (DUK) agreed to comply with the subpoenas and store documents in 
a repository in Sacramento, if the company and the committee can agree on how 
to keep the documents confidential. Lawyers for both sides said they could 
work out an agreement. 
Enron and Mirant can have the contempt citations withdrawn if they turn over 
the requested documents to the repository by July 10.

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


California Senate committee cites power companies for contempt for 
withholding documents
By JENNIFER COLEMAN
Associated Press Writer

06/29/2001
Associated Press Newswires
Copyright 2001. The Associated Press. All Rights Reserved.

SACRAMENTO, Calif. (AP) - A Senate committee investigating possible price 
manipulation in California's energy markets cited two power generators for 
not turning over documents requested for the probe. 
The documents - which include details on bidding, pricing and other aspects 
of power sales - had been requested in subpoenas issued earlier this month to 
Enron Corp., Mirant Inc. and four other generating companies.
On Thursday, the Senate Select Committee to Investigate Market Manipulation 
approved a contempt motion, citing Enron and Mirant for not producing the 
materials. The other four generators complied. 
The motion still needs approval by the full Senate. 
The Senate Rules Committee had subpoenaed the materials. 
Enron, based in Houston, said its documents are outside the committee's 
jurisdiction because they are kept in Texas. An attorney for Atlanta-based 
Mirant said the company wanted to comply, but did not act quickly enough to 
avoid the contempt vote. 
California law does not specify penalties for a contempt finding, said 
Laurence Drivon, the committee's special counsel. "The Senate can take such 
action as it deems necessary and appropriate," he said. 
Enron's claim that the committee lacked jurisdiction outraged some senators, 
who said previous legislative investigations have sought documents from 
throughout the world. 
"If they've done nothing, if they've got nothing to hide, there's no reason" 
not to comply, Sen. Debra Bowen said. 
The committee has been negotiating with the companies to try to reach a 
confidentiality agreement for the release of the documents, and has asked the 
generators to sign agreements not to destroy any potentially relevant 
documents. 
So far, some companies have agreed verbally, but none has signed. 
Duke Energy agreed to comply with the subpoenas and store documents in a 
repository in Sacramento, if the company and the committee can agree on how 
to keep the documents confidential. Lawyers for both sides said they could 
work out an agreement. 
Enron and Mirant can have the contempt citations withdrawn if they turn over 
the requested documents to the repository by July 10. 
--- 
On the Net: 
Senate select committee: 
www.sen.ca.gov/ftp/sen/committee/select/INVESTIGATE/-home1/PROFIL .H TM 
Enron: http://www.enron.com 
Mirant: http://www.mirant.com

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


INDIA: Buyers seek price cut from Enron India unit-paper.

06/29/2001
Reuters English News Service
(C) Reuters Limited 2001.

NEW DELHI, June 29 (Reuters) - Enron's troubled 2,144-MW Dabhol power plant, 
whose only buyer has stopped purchasing electricity, can find customers for 
700 MW if it cuts its price, a business daily said on Friday. 
The Hindu Business Line said the Central Electricity Authority submitted a 
report to the power ministry saying the southern state of Karnataka was 
willing to buy 300 MW from Dabhol Power Co in the western state of 
Maharashtra.
It said Madhya Pradesh in central India could take 100 MW and Rajasthan in 
northwestern India wanted 150 MW while the western state of Gujarat and 
Haryana and Delhi in the north wanted 150 MW. 
Karnataka said it was willing to pick up power at under three rupees while 
others were willing to buy at around 2.8 rupees, the newspaper said. 
At peak capacity, Dabhol, which is owned 65 percent by Houston-based Enron, 
charged 4.75 rupees per kilowatt hour, more than the cost of electricity from 
state-owned plants. 
But after the Maharashtra State Electricity Board defaulted, Dabhol scaled 
down to 25 percent capacity and charged 7.1 rupees, more than triple the rate 
of other suppliers. 
Earlier this month, India's Junior Power Minister said Dabhol had offered to 
charge much less for power from the second phase of its $2.9 billion project. 
But a Dabhol spokesman said then it was too early to talk about specific 
tariff cuts as they would depend on the plant load factor, the exchange rate 
and the prevailing oil price. 
The plant's first phase of 740 MW began operations in May 1999. The second 
phase would have added 1,444 MW this year but its contractors stopped work 
this month as lenders were unwilling to support the venture. 
The federal government recently asked the Central Electricity Authority to 
talk to power-deficient states and find out if they were willing to buy power 
from Dabhol. 
Federal Power Minister Suresh Prabhu told Reuters on Thursday the CEA had 
prepared a preliminary report and another one looking at the price elasticity 
of demand would be sent later.

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


Business
Fibernet upbeat on European progress
Liz Vaughan-Adams

06/29/2001
The Independent - London
FOREIGN
21
(Copyright 2001 Independent Newspapers (UK) Limited)

FIBERNET, WHICH supplies and installs high-speed data networks to businesses, 
delivered an upbeat trading statement yesterday, saying it had made positive 
progress in the UK, Germany and France. 
The company, which has some pounds 100m cash in the bank, said in the light 
of the profitable growth of its UK business, it remained "confident" of 
continuing progress.
Shares in Fibernet jumped 52.5p to 350p. At the height of the internet bubble 
in spring of last year, the stock had traded as high as pounds 27.87. 
The company, which was updating investors on trading in its third quarter to 
31 May, said it had won new business from Credit Lyonnais, Thus and Enron, 
adding to a blue-chip client base that already includes the likes of JP 
Morgan, HSBC and Lloyds TSB. 
In the UK, the company said it was seeing a high rate of renewals on original 
three and four-year network service contracts that had expired. It also said 
it was continuing to develop new business in its service provider markets 
"and in spite of the current volatility within this sector both cash and 
collectibles remain to budget". 
Fibernet also said the costs of building telecoms networks in Germany and 
France should be less than originally budgeted. The company is building a 
3,300km network in Germany and expects to start delivering services in 
Frankfurt "imminently" while national services should be available in August. 
Fibernet said it believed its performance there would be "in line" with 
market expectations. 
In France, Fibernet said its development activities were also progressing "as 
planned" and that it had also identified potential acquisition targets. 
In the six months to February, Fibernet reported Ebitda of pounds 9.9m, up 50 
per cent from a year ago. Pretax profits more than doubled to pounds 3.2m.

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


ANOTHER US ENERGY CO MAY GET INVOLVED IN INDIAN DABHOL PROJECT

06/29/2001
Asia Pulse
(c) Copyright 2001 Asia Pulse PTE Ltd.

MUMBAI, June 29 Asia Pulse - United States-based energy company AES has said 
that it would consider getting involved in the Enron-promoted Dabhol Power 
Company (DPC) if an opportunity presented itself. 
"We have not received any such proposals and as a global power company we 
have a long-term view of the Indian power scenario and will consider getting 
involved in DPC and other Indian power projects at an approriate time", AES 
(India) exective director Surender Singh told PTI here over phone from Delhi.
AES had not made any former proposal in this regard to its stakeholders, 
Singh said adding the power utility considers important the commitment and 
willingness of parties to honour a contract for its investment decision in 
any project. 
+This is the basis of our current investment and for any future investment in 
India and any other country+, he said. 
Singh, however, denied media reports that the US energy major had offered to 
reduce DPC's +costly+ tariff to less than Rs three per unit including 
transmission cost. 
"We have never spoken about being interested in the project at this stage, 
let alone the reduced tariff part," he clarified. 
Currently, AES (India) holds 49 per cent stake in Orissa Power Generation 
Company and owns the distribution firm Cesco. 
The company was reportedly in trouble, similar to DPC's over non-payment of 
dues to the tune of Rs 209 crore from the state-owned distribution company 
GRIDCO in Orissa. 
(PTI) 29-06 1736

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


India: States willing to buy only 700 MW surplus from DPC

06/29/2001
Business Line (The Hindu)
Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - 
Asia Intelligence Wire

NEW DELHI, June 28. THE Central Electricity Authority (CEA) has told the 
Power Ministry that the neighbouring States will be willing to purchase only 
700 MW of surplus power from the Dabhol project. 
Some States have said that they are interested in peak power. Karnataka, 
Delhi, Gujarat, Haryana and Madhya Pradesh have suggested an average contract 
period of two years.
Karnataka is the only State which has shown interest in picking up power 
round the clock, throughout the year. 
While it has pitched for 300 MW of DPC power, Madhya Pradesh has indicated 
100 MW consumption, Rajasthan 150 MW and Delhi, Haryana, Gujarat pitching in 
for the rest. 
These States have said that they would have nothing to do with Dabhol Power 
Company and that they would enter into a purchase contract only with 
Maharashtra State Electricity Board. 
Tamil Nadu and Andhra Pradesh have told CEA that they are not interested in 
picking up the surplus power from the Dabhol project. 
On the pricing front, while Karnataka has said that it was willing to pick up 
power at a price less than Rs 3 per unit, the others have suggested a 
marginally lower price in the range of Rs 2.80 per unit. 
The finding comes on the eve of the negotiating committee meeting on Friday. 
One of the crucial issues facing the Dabhol project was the offtake of power 
from the second phase having a capacity of 1,415 MW. 
Power trade picks up: Even as the Enron controversy continues, power trade in 
the country has picked with the Power Trading Corporation (PTC) structuring 
an innovative deal to purchase 150 MW power from West Bengal and sell it 
across to the northern States. 
This is unique since payment for power is to be made on a weekly basis as 
against the convention of monthly billing. According to the PTC Chairman, Mr 
T.N. Thakur, such an arrangement would disincentivise payment default. This 
is because longer payment cycles make room for larger defaults and result in 
negotiations relating to partial payment in order to restore power sale. 
To ensure that this commercial argument works, PTC's contract with the seller 
includes a clause whereby it is not bogged down by any take-or-pay 
arrangements. Hence, the purchasing States know that the threat to cut power 
supply is a reality with no attendant financial encumbrances for PTC. 
With regard to the seller, the lenders to the project in case of private 
sector have raised objections as in the case of the Bhilwara group-promoted 
Malana hydel project in Himachal Pradesh. In a deal similar to the West 
Bengal contract, PTC is selling power from the project to Delhi. 
- Balaji C. Mouli

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


ENRON GROUP DEVISES $US50MLN INDIA OILFIELD EXPANSION PLAN

06/29/2001
Asia Pulse
(c) Copyright 2001 Asia Pulse PTE Ltd.

NEW DELHI, June 29 Asia Pulse - A consortium of Enron, Oil and Natural Gas 
Corporation (ONGC) and Reliance is working on a US$50 million development 
plan to increase reserves in the Panna-Mukta oil and gas fields to 214 
million barrels of oil and oil equivalent gas. 
The proposed expanded plan of development under consideration envisaged 
increasing reserves to 214 million barrels of oil and oil equivalent gas 
through drilling new wells and 3D modeling over the next two years, sources 
in the consortium said.
Current estimates of the balance of recoverable reserves from the Panna-Mukta 
fields are 184 million barrels of oil and oil equivalent gas. 
The Panna and Mukta fields currently produce over 29,000 barrels of crude oil 
and 2.5 million cubic meters of gas per day, sources said. 
The development plan would increase the recoverable reserves by 16 per cent. 
ONGC has a 40 per cent interest in the unincorporated joint venture with 
Enron and Reliance to develop proven oil and gas fields at Panna, Mukta and 
Tapti. Enron and Reliance hold a 30 per cent share each in the $US900 million 
venture. 
From the Tapti field, 1,974 million cubic meters of gas was produced during 
2000-01. 
Oil and gas produced from the Panna-Mukta and Tapti fields was at present 
being sold to the state-owned Indian Oil Corporation (IOC) and Gas Authority 
of India Ltd (GAIL), sources added. 
(PTI) 29-06 1021

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






June 29, 2001
Houston Chronicle

Enron held in contempt in California 
Company: Assembly has no jurisdiction 
Bloomberg Business News 
SACRAMENTO, Calif. -- A California Senate committee voted to hold Enron Corp. 
and Mirant Corp. in contempt after they refused to turn over documents sought 
in an investigation of accusations that they manipulated power prices. 
Enron's attorney said in a letter to the committee that the company refused 
to comply because only the Federal Energy Regulatory Commission has 
jurisdiction over the wholesale electricity market. Mirant said it would 
attempt to comply by the July 10 deadline. 
The leader of the California State Senate Select Committee to Investigate 
Price Manipulation of the Wholesale Energy Market said the committee won't 
back off its efforts to get the papers. 
"Our ultimate goal is the production of the documents," said Committee 
Chairman Joseph Dunn, a Democrat from Santa Ana, during the hearing in 
Sacramento today. "We've wanted it for three months, and we want it today." 
The full Senate will decide on fines or other punishments if the companies 
fail to comply by July 10, Dunn said. 
Six other generators agreed to honor the subpoenas after it became clear the 
committee would hold them in contempt if they didn't comply. They are AES 
Corp., Duke Energy, Houston-based Dynegy, NRG Energy, Houston-based Reliant 
Energy and Williams Cos. 
California has spent more than $7 billion this year buying power after its 
two biggest utilities became insolvent. State utilities have more than $15 
billion in losses and debt from buying power at soaring prices over the last 
12 months. 







June 29, 2001
Houston Chronicle
Briefs: Houston & state 
Duke Energy to buy Enron power plant
Duke Energy Corp., owner of the largest U.S. utility, agreed to buy a 
400-megawatt Mississippi power plant from Houston-based Enron Corp. to expand 
its generating capacity in the southeastern United States. 
Duke spokeswoman Jennifer Pierce declined to disclose the price of the 
purchase, which is expected to close in October. 
The natural-gas-fired plant, capable of powering 400,000 homes, is in Union 
County. Duke has a 520-megawatt plant in Mississippi and is building two 
640-megawatt plants there. One megawatt is enough power to light about 1,000 
U.S. homes. 



USA: Calif. Senate panel cites generators for contempt.

06/28/2001
Reuters English News Service
(C) Reuters Limited 2001.

SACRAMENTO, Calif., June 28 (Reuters) - A California state Senate committee 
voted to cite Mirant Corp . and Enron Corp for contempt on Thursday after the 
energy generators failed to supply confidential documents as required by 
subpoena. 
The committee, which is seeking evidence of power price manipulation in 
California's chaotic energy market, voted unanimously for the contempt 
citations after Mirant and Enron did not produce the required papers.
"The step we took today is historic," said state Sen. Joe Dunn, Democratic 
chair of the Senate Select Committee to Investigate Market Manipulation. "We 
haven't done this in 72 years." 
Dunn said his committee would draw up a contempt report which would be 
forwarded to the Senate by July 10. 
The full Senate, in turn, will be charged with determining what sanctions to 
impose - which could range from renewed orders for documents to fines to jail 
time for individuals determined to have obstructed compliance with the 
subpoenas. 
The committee postponed action on possible contempt citations for other 
energy companies, including Reliant , Dynegy , Williams Cos , Duke Energy , 
AES Corp and NRG Energy , giving them until July 10 to follow through on 
promises to provide the required documentation. 
Dunn said the citations against Mirant and Enron - which would be the first 
imposed by California's state Senate since 1929 - would be vacated if the 
companies comply with the subpoenas by the July 10 deadline. 
The companies have objected to providing the confidential materials, which 
they argue includes proprietary information on bidding and pricing for 
California energy purchases that, if disclosed, could damage their 
competitive ability. 
Enron, in particular, has rejected the committee's authority, saying it keeps 
its documentation in Texas and is therefore outside California jurisdiction.

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


Enron, Mirant Held in Contempt by Calif. Senate Panel (Update2)
2001-06-28 21:04 (New York)

Enron, Mirant Held in Contempt by Calif. Senate Panel (Update2)

     (Adds details of hearing, comments in ninth through 11th
paragraphs and in last two paragraphs.)

     Sacramento, California, June 28 (Bloomberg) -- A California
Senate committee voted to hold Enron Corp. and Mirant Corp. in
contempt after they refused to turn over documents sought in an
investigation of accusations that they manipulated power prices.
     The Senate Select Committee to Investigate Price Manipulation
in the Wholesale Energy Market, in the first contempt citation by
a California Senate committee since 1929, said the companies had
until July 10 to comply, or the full Senate would vote to impose
fines or other sanctions.
     The committee is investigating allegations that energy
generators withheld supplies or took other steps to boost prices
for electricity in California last year, when soaring wholesale
prices left the state's largest utilities insolvent.
     ``Our ultimate goal is the production of the documents,''
said committee Chairman Joseph Dunn, a Democrat from Santa Ana,
during a break in the hearing in Sacramento today. ``We've wanted
it for three months, and we want it today.''
     Enron's attorney said in a letter to the committee that the
company refused to comply because only federal regulators have
jurisdiction over the wholesale electricity market, and that a
state committee has no right to documents outside California.
Mirant said it needs assurances the documents would not be made
public before the company would turn them over.
     Six other generators agreed to honor the subpoenas after the
committee threatened to hold them in contempt if they didn't
comply. They are AES Corp., Duke Energy Corp., Dynegy Inc., NRG
Energy Inc., Reliant Energy Inc. and Williams Cos.
      California has spent more than $7 billion this year buying
power after its two biggest utilities became insolvent. State
utilities have more than $15 billion in losses and debt from
buying power at soaring prices over the last 12 months.

                         Enron Objects

     Enron laid out its objections to the subpoena in a letter to
the committee by its attorneys at Post Kirby Noonan & Sweat LLP
released by the committee today.
     Enron's lawyers argued that the committee does not have
authority to subpoena records from outside the state and said the
committee already had access to much of the information from state
regulators and the state's electricity grid manager.
     ``This is a shakedown. It's a witch-hunt. It's McCarthyism,''
Enron spokesman Mark Palmer said. ``We're going to protect our
legal rights and say something's wrong when it's wrong, and this
is wrong.''
     State Senator Debra Bowen, chairwoman of the Senate's
utilities committee, said that if Enron and the other power
providers have done nothing illegal, they shouldn't be withholding
the documents requested.
     ``This does not look like to me like folks who have nothing
to hide,'' Bowen said during a break in the hearing. ``It's not
just a thumb in the eye, it's a pie in the face of the
Legislature.''
     The committee's action was the first time in 72 years that a
California Senate committee has held anyone in contempt, Dunn and
Bowen said. The 1929 action involved market manipulation in the
cement industry, Bowen said.
     Mirant wants the committee to provide guarantees that the
``millions of documents'' the company is collecting won't be made
public, spokesman Patrick Dorinson said.
     ``These documents contain proprietary information,'' Dorinson
said. ``We'll continue talking to the committee and see if we can
get a resolution to this issue.''

                        Private Depository

     During the hearing today on whether to hold the companies in
contempt, Joel Kleinman, a lawyer for Duke Energy, said the
company would create a private depository where the committee
could view the documents.
     Williams is also willing to turn over documents to the
depository, company lawyer John Larrea said. Williams has an
agreement to market and sell electricity produced by AES.
     Earlier today, Reliant Energy turned over 1,800 pages of
documents requested by the committee, Dunn said, and Dynegy
submitted 18,000 pages. He said the committee has not had time to
review the documents.
     Dynegy spokesman John Sousa said the company is complying
with the committee's subpoena. Reliant spokesman Richard Wheatley
confirmed that the company had turned over some documents, and
would give the committee others if the company received assurances
they would be kept confidential.
     ``We need some guarantees of confidentiality,'' Wheatley
said.
     Duke and Williams agreed to a confidentiality agreement
offered by the committee that the companies had previously
rejected. That was the most significant accomplishment in today's
hearing, Dunn said.
     ``It took a hearing of this magnitude to force an agreement
on confidentiality,'' Dunn said after the hearing. ``They said
they want some minor tweaks. We'll see what those minor tweaks
mean.''



Duke Energy Agrees to Buy Mississippi Power Plant From Enron
2001-06-28 16:51 (New York)

Duke Energy Agrees to Buy Mississippi Power Plant From Enron

     Charlotte, North Carolina, June 28 (Bloomberg) -- Duke Energy
Corp., owner of the largest U.S. utility, agreed to buy a 400-
megawatt Mississippi power plant from Enron Corp. to expand its
generating capacity in the southeastern U.S.
     Duke spokeswoman Jennifer Pierce declined to disclose the
price of the purchase, which is expected to close in October.
     The natural-gas-fired plant, capable of powering 400,000
homes, is in Union County. Duke has a 520-megawatt plant in
Mississippi and is building two 640-megawatt plants there. One
megawatt is enough power to light about 1,000 U.S. homes.
     The North American Electric Reliability Council estimates
that the Southeast will need an additional 40,000 megawatts of
generating capacity in the next 10 years to meet demand,
Charlotte, North Carolina-based Duke said.
     Duke shares fell $1 to $39.30. They had risen 40 percent in
the past year. Shares of Houston-based Enron, the largest energy
trader, rose $1.62 to $48.34.



U.S. Power Suppliers' Second-Quarter Profits to Rise (Update1)
2001-06-28 14:36 (New York)

U.S. Power Suppliers' Second-Quarter Profits to Rise (Update1)

     (Updates to adjust table with profit estimates.)

     Houston, June 28 (Bloomberg) -- Energy traders and power
generators such as Enron Corp. and Duke Energy Corp. will have
higher second-quarter profits because of rising electricity prices
in the West, and the opening of new power plants.
     Efforts to lower western power prices didn't bear fruit until
late in the quarter. California border prices averaged $236.89 a
megawatt hour, up from $73.51 in the year-earlier period, boosting
profit for anyone with power to sell.
     The future doesn't look as bright for traders. Federal
regulators last week ordered them to negotiate refunds that
California's Governor Gray Davis says should total at least $8.9
billion. Enron, El Paso Corp., Dynegy Inc. and Williams Cos. have
lost $24.7 billion, or 22 percent, in market value in the past six
months as a growing political backlash led investors to sell their
shares.
     ``The market really hates uncertainty, and when the governor
throws out a figure of $9 billion in possible refunds, that's a
lot of uncertainty,'' said John Nichol, a fund manager at
Federated Investment Management, which owns shares of generators.
      Soaring power prices have left California's two largest
utilities insolvent and saddled with about $15 billion in power-
buying losses and debts. Regulators have boosted rates by more
than 50 percent for businesses and consumers in the most-populous
state.

                         Prices Rise

     The soaring prices benefited companies such as Enron, which
sells both electricity and contracts that help limit customers'
risk when energy prices rise or fall. Enron will make 42 cents a
share, up from 34 cents a year earlier, based on the average
estimate of analysts polled by First Call/Thomson Financial.
     Dynegy, which owns natural-gas pipelines and California power
plants, made 40 cents a share in the quarter, based on First Call
estimates, up from 29 cents a year earlier. The Houston-based
company is 29 percent owned by Chevron Corp. of San Francisco.
     ``Companies with power plants in the West have done very
well,'' said Greg Phelps, manager of the $1.1 billion Patriot
Group of funds. ``The Pacific Northwest drought continues to crimp
hydroelectric supply, which is keeping prices higher.''
     In addition, companies opened new power plants across the
U.S. Duke, Mirant Corp. and Calpine Corp. opened new U.S. plants
with enough capacity to light almost 5 million homes in the last
year, boosting sales.

                         Regulators Act

      Strong earnings in the West are unlikely to last. Growing
voter disenchantment with President George W. Bush's handling of
the California crisis and a return of Democratic control of the
U.S. Senate led the Federal Energy Regulatory Commission to impose
price caps for 11 states on June 18.
      The caps apply to all electricity on the western power grid,
the system of transmission lines that moves electricity through
the region. FERC also ordered generators to negotiate refunds with
officials from the states that could total as much as $15 billion.
Talks began on Monday.
     Administrative Law Judge Curtis Wagner, who is overseeing the
negotiations, told the Associated Press that ``in order to reach a
settlement, there will have to be refunds.'' Davis estimates the
generators overcharged California and its utilities by $8.9
billion or more.
     Enron, which earlier this year estimated it's owed $400
million to $500 million for California energy sales, is one of the
companies in the talks. Shares of the Houston-based company, the
largest energy trader, have fallen 44 percent this year and 20
percent this quarter.
     Enron's prospects also were hurt when it couldn't sell its
Oregon utility, Portland General, and its plans for trading space
on fiber-optic telecommunications networks grew less promising
because of the collapse of many Internet companies.
     Also, while natural-gas and electricity prices in the West
are up from a year ago, they are down from the first quarter.

                    Investigations Continue

     El Paso, owner of the biggest U.S. natural-gas pipeline
network and an energy trader, is being squeezed by falling energy
prices, increased regulatory scrutiny and the decline in the
prospects of its fiber-optic trading unit. The stock has fallen 28
percent this year.
     FERC is hearing arguments on whether the Houston-based
company conspired to boost natural-gas prices in California last
winter, and El Paso may have to pay refunds or fines. Gas fuels
many of the California's power plants, and higher prices
contributed to soaring electricity prices.
     The company will see second-quarter earnings of 77 cents, up
from 69 cents a year earlier, First Call estimates show.
     Williams's second-quarter earnings were almost unchanged at
55 cents, based on First Call estimates, because of wider profit
margins on refining and gas processing, and higher natural-gas
prices.
     Williams, the second-largest U.S. gas pipeline company, has a
20-year agreement with AES Corp. to supply fuel for plants in
Huntington Beach, Long Beach and Redondo Beach in California.
Williams, an energy trader, also sells the power from the plants.
AES, based in Arlington, Virginia, is one of the biggest U.S.
power-plant developers.

                         Boosting Capacity

     So far, Williams has agreed to refund $8 million to the
state, though it admitted no wrongdoing. It's also taking part in
the negotiations over bigger refunds.
     Mirant, an Atlanta-based power-plant developer, will see per-
share profit rise to 46 cents from 25 cents a year ago, according
to First Call. San Jose-based Calpine will earn 31 cents, up from
19 cents, and Charlotte-based Duke will make 52 cents, up from 44
cents, estimates show.
     Calpine opened plants in Arizona, Maine and Texas with a
combined capacity of 1,545 megawatts. A megawatt is enough power
to light about 1,000 U.S. homes. Calpine also bought two power
plants in Canada. Most of the company's plants are in California.
     ``Calpine is a classic story,'' said Chris Ellinghaus, an
energy analyst at Williams Capital Group. ``They'll get a double
boost from more production and higher prices.''

                          Building Plants

     Calpine runs or is building plants in 29 U.S. states and
Canada that provide enough power to light 29.9 million homes. It
plans to boost its capacity to 70,000 megawatts, or enough to
light 52.5 million homes, by 2005. The company's shares have
fallen 31 percent this quarter.
     Duke, a power-plant developer and owner of a natural-gas
pipeline network, opened five generating plants in the quarter
with a combined capacity of 2,840 megawatts.
     ``Part of our growth is related to (California), but part
comes from growth in our trading business, part comes from our
plants overseas and part comes from natural gas,'' Duke spokesman
Terry Francisco said. Duke shares have fallen 5.5 percent this
year.
     Mirant opened two plants with a combined capacity of 546
megawatts. Southern Co., the owner of Atlanta's utility, spun off
Mirant in April. Mirant's shares have climbed 54 percent since the
stock began trading in September.
     Generators had to rely on new power plants to boost revenue
during the quarter because electricity prices in New England, the
Middle Atlantic states and the Southeast were little changed from
a year earlier. Texas prices fell 19 percent.

                         Prices Level Off

     Prices also are stabilizing in California. Davis last week
released details on long-term contracts the state has signed to
secure about one-third of its power needs. The contracts have
reduced the state's dependence on the open market, driving down
power prices in the West.
     The contracts guarantee energy companies a steady stream of
revenue, though at lower prices than on the daily market. Still,
wholesale electricity prices will surge this summer in any part of
the U.S. where heat waves cause shortages, boosting generators'
profits, analysts say.
     ``There is still enough volatility in the market,'' Credit
Lyonnais Securities analyst Gordon Howald said. ``There are not a
lot of groups out there able to generate the solid earnings growth
you'll see in the power producers.''

*T
                         2nd-Qtr       Year-Ago       Number of
Company                 Estimate         EPS          Analysts


AES Corp.                $0.30          $0.25             7
Calpine Corp.             0.31           0.21             9
Duke Energy Corp.         0.52           0.44             6
Dynegy Inc.               0.40           0.29            15
El Paso Corp.             0.77           0.69            11
Enron Corp.               0.42           0.34            14
Mirant Corp.              0.46           0.34             8
NRG Energy Inc.           0.22           0.28             6
Reliant Energy Inc.       0.73           0.83            12
Williams Cos.             0.55           0.54            10

Estimates provided by First Call/Thomson Financial.

*T
--Mark Johnson in the Princeton newsroom, (609) 279-4017 or
mjohnson7@bloomberg.net, with Margot Habiby in Dallas/pjm/alp