As you may recall we have been arguing with the MN Dept. of Revenue for years 
over whether or not natural gas used as a compressor fuel was subject to the 
Minnesota use tax.  Great Lakes has been in court with the DOR over this same 
issue.  Today I received the following, which is an internal memo that was 
circulated in the Dorsey & Whitney law firm, which has been representing 
Great Lakes announcing a favorable ruling.  


---------------------- Forwarded by Lon Stanton/ET&S/Enron on 11/21/2000 
10:54 AM ---------------------------


"Ahern, Michael" <Ahern.Michael@dorseylaw.com> on 11/21/2000 10:18:28 AM
To: "Stanton, Lon (E-mail)" <lstanto@enron.com>
cc:  

Subject: FW: Litigation News


Lon, thought you might be interested in this.

>  -----Original Message-----
> From:  Buckvold, Bob
> Sent: Tuesday, November 21, 2000 9:04 AM
> To: TRT All; Dirks, Katy; Frederick, Gloria; Snow-Samanant, Julie;
> Starkey, Melissa; Hinkley, Sally
> Subject: Litigation News
>
>  In a successful collaboration between the Tax Department and the
> Trial Department, Jack Windhorst and Chris Shaheen went to trial in
> Minnesota Tax Court and obtained a $1.5 million judgment for our client,
> Great Lakes Gas Transmission Ltd. Partnership.  Great Lakes transmits
> natural gas on behalf of shippers through an interstate pipeline system
> that runs through various states, including Minnesota.  The pressure of
> the gas decreases as it moves through the pipeline system.  Great Lakes
> has five compressor stations along its pipeline in Minnesota,  at which
> separators and compressor engines refine the gas and increase the pressure
> of the gas so that it will continue to flow through the pipeline.  Some of
> the natural gas in the system is burned as fuel by the compressor engines.
>
>  The Minnesota Commissioner of Revenue determined that Great Lakes
> must pay "use tax" for the compressor fuel gas and, in a 1998 Order,
> denied Great Lakes' claim for a refund of use taxes paid in 1994 and 1995.
> At a two day trial in February, Great Lakes presented fact and expert
> testimony supporting its contention that the compressor fuel was consumed
> in "industrial production" and therefore was exempt from taxation under
> the "industrial production exemption."  The Commisioner argued that Great
> Lakes was simply transporting the gas and therefore did not qualify for
> the exemption.  After extensive post-trial briefing, the court issued an
> opinion on November 16 reversing the Commissioner's Order and entering
> judgment for Great Lakes.  The decision should result in millions of
> dollars in additional savings for Great Lakes for tax years not directly
> at issue in the case.
>