Cheney's Role Offers Strengths And Liabilities
The Washington Post, 05/17/01

Dolphin to Invite Companies for $4 Bln Gas Project, Paper Says
Bloomberg, 05/17/01

UK: ANALYSIS-Spanish boom spurs wave of new power plants.
Reuters English News Service, 05/17/01

Middle East flame burns ever brighter as exports hot up
Lloyd's List International, 05/17/01

Enron Joins Alberta's Natural Gas Exchange
Dow Jones Energy Service, 05/16/01

Enron could lose Brazil environmental lincence - Rio state official
AFX News, 05/16/01

Creditors' of PG&E's Utility Form Information Clearinghouse
Bloomberg, 05/16/01


A Section
Cheney's Role Offers Strengths And Liabilities
Mike Allen and Dana Milbank
Washington Post Staff Writers

05/17/2001
The Washington Post
FINAL
A01
Copyright 2001, The Washington Post Co. All Rights Reserved

The key to the energy proposal President Bush unveils today can be found on a 
wall in the three-room suite that houses his National Energy Policy 
Development Group, next door to the White House in the Eisenhower Executive 
Office Building. 
On the wall hangs a huge erasable board that serves as a giant checklist to 
guide the preparation of the administration's eight-chapter energy policy, 
which Bush formally unveils in Minnesota today. For each chapter, there's a 
check mark for two rough drafts, a peer review, a final draft, two more 
rounds of recommendations on the drafts, then graphics and photos. Toward the 
end of the checklist is an all-important box to check: "Concurrence of the 
OVP."
The OVP -- Office of the Vice President -- has driven every aspect of the 
energy report. No proposed recommendation has survived without the consent of 
one man: Vice President Cheney, the administration's indispensable man -- and 
chair of the energy task force. 
The release of the energy report shines a new spotlight on Cheney, a quiet 
conservative from Wyoming who has been given credit for running the show 
without annoying or upstaging his boss. The handling of the energy task force 
so far reflects Cheney's personality near perfectly: It is a closely held 
process with a high regard for the concerns of industry. This close 
involvement of Cheney is partially a strength, because the effort has been 
efficient and well-managed. 
But Cheney's strong role is also potentially the report's weakness. He is 
about to undergo a blast of unwanted scrutiny as critics seize on his 
finances and oil industry ties in an effort to discredit the policy. 
Democrats and environmental groups are charging that his judgment on energy 
matters is suspect because of his chairmanship until August of Halliburton 
Co., a Dallas-based energy services firm that is expected to benefit from 
several parts of President Bush's policy. Cheney, 60, made $36 million last 
year, most it in compensation from Halliburton, including salary and his 
exercise of stock options and sale of restricted stock. 
"He is seeing the problem entirely from the side of the energy producing 
industry that made him a millionaire, not from a consumer struggling to make 
ends meet," said Philip E. Clapp, president of the National Environmental 
Trust. 
An official close to Cheney called such suggestions "an outrage," and said 
his expertise in the industry and knowledge of its technology were crucial to 
"trying to solve a problem of this magnitude." 
Although the plan has extensive recommendations about using technology to 
conserve energy and produce power more cleanly, the heart of the report is 
its conclusion that the United States needs hundreds more power plants, 
natural gas pipelines, oil wells and nuclear reactors. 
Several administration officials acknowledged that Cheney had handed 
ammunition to his critics by declaring in a speech in Toronto on April 30 
that conservation "may be a sign of personal virtue," but is not a sound 
basis for a comprehensive energy policy. 
"Given his background, he should've been real careful," said Sen. Charles E. 
Schumer (D-N.Y.), who has offered an alternative energy plan that he says 
focuses equally on supply and demand. "I think they've had some real 
stumbles." 
Sen. Craig Thomas (R), who succeeded Cheney as Wyoming's lone House member in 
1989, said he does not expect such criticism to rattle the circumspect 
Cheney. "He'll just say, 'All right. That's the way it is, folks. I'm doing 
my job. Here's my plan,' " Thomas said. 
As always when questions are asked about Cheney's influence, White House 
officials argue vigorously that the energy plan is Bush's plan. An official 
close to Bush said Cheney and other task force members had updated the 
president often since beginning their work on Jan. 29. "At several critical 
decision points, the group has come to the president to ask him to make 
judgments and decisions," the official said. 
Cheney's directions are carried out by the task force's executive director, 
Andrew Lundquist, his deputy, Karen Knudsen, and four other staff members. 
Cheney also chairs the task force itself, which includes the secretaries of 
energy, interior, treasury, agriculture, commerce and transportation and the 
head of the Environmental Protection Agency. 
Aides say Cheney met with only half a dozen of the interest groups seeking 
input into the policy, including Enron Corp., the Houston energy conglomerate 
that is a large and longtime Bush contributor, and the Edison Electric 
Institute, an energy trade group. Vance Meyer, a spokesman for Enron, said 
the firm's chairman, Kenneth Lay, and another executive had a 30-minute 
meeting with Cheney. Edison assembled 15 or 20 chief executives to meet with 
Cheney. 
But Lundquist and Knudsen, representing Cheney, met with half of the 400 or 
so groups -- industry, environmental, regulatory and academic -- that 
requested access. Exactly which groups the Cheney advisers met with is being 
kept secret by the White House. 
The task force's stealthy operation reflects Cheney's distaste for publicity. 
Following news reports about the private nature of the energy deliberations, 
Democrats on the House Energy and Commerce Committee and Government Reform 
Committee requested information about the groups the task force met with. 
Cheney's counsel, David S. Addington, rebuffed the members of Congress, 
arguing that there was no legal requirement to comply with the request. 
In a seven-page response to the request, Lundquist wrote that the meetings 
"were simply forums to collect individual views rather than to bring a 
collective judgment to bear." White House officials have declined to disclose 
the list of meetings or attendees. Aides said representatives at the meetings 
included 118 energy industry or corporate groups, 40 renewable energy 
providers, 22 unions, 13 environmental groups, five academics, 63 
governmental groups, six energy efficiency proponents and a consumer group. 
Environmentalists complain that the meetings reflected Cheney's 
predispositions. The vice president met with industry leaders, while 
dispatching aides to speak to environmentalists, several of which were 
grouped into one meeting. The meetings of 22 labor representatives, who 
gathered in groups, were publicized by the White House, but sessions with 
industry were not. 
Cheney, who declined to be interviewed for this article, told the Associated 
Press that he hasn't consulted with any officials from Halliburton and 
rejected the notion that the task force's work is compromised by his private 
meetings with industry officials who give money to the Republican Party. 
"Just because somebody makes a campaign contribution doesn't mean that they 
should be denied the opportunity to express their views to government 
officials," he said. 
Cheney chaired nine meetings of the Cabinet-level task force, mostly in his 
ceremonial office. Each of the meetings, attended by the task force members 
and aides, lasted 90 minutes, with Environmental Protection Agency 
Administrator Christine Todd Whitman, Energy Secretary Spencer Abraham and 
Bush economic adviser Lawrence B. Lindsey often reflecting different 
interests. 
For 20 minutes at the end of each session, Cheney told staffers to leave the 
room so the top officials could settle differences privately, without risk of 
the differences being leaked to the news media. In only a few cases did Bush 
have to resolve disputes among advisers, participants said. In most cases, 
Cheney was able discreetly to broker agreement among the Cabinet members.

http://www.washingtonpost.com 

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


Dolphin to Invite Companies for $4 Bln Gas Project, Paper Says
2001-05-17 03:00 (New York)


     Abu Dhabi, United Arab Emirates, May 17 (Bloomberg) --
Dolphin Energy Ltd. of the United Arab Emirates will invite
companies to pre-qualify this month for a $4 billion project
to build the Middle East's first cross-border gas pipeline
network, Al-Hayat said.
     Dolphin, in which U.S.'s Enron Corp. and France's
TotalFinaElf SA share a 49 percent stake, will ask
for designs and quotes May 19-23 for most stages of the
network, from the delivery of gas from Qatar's offshore North
field to its final destination in Dubai, the paper said.
     The network includes a 2-billion cubic-feet-per-day gas
-processing plant in Qatar, a 220-mile sub-sea pipeline from
Qatar to Abu Dhabi, and an overland pipeline from
Abu Dhabi to Dubai, the paper said, citing a Dolphin statement.
The first delivery via the network will be in 2005.
     Qatar, which owns the world's third-largest gas reserves, and
the U.A.E. want the network to form the core of a
regional grid to power electricity and water-desalination
plants, as well as gas-based industries, for decades to come.

(Al-Hayat 5/17 p.11)

For Al-Hayat's Web site see {WNLB <GO>}



UK: ANALYSIS-Spanish boom spurs wave of new power plants.
By Margaret Orgill

05/17/2001
Reuters English News Service
(C) Reuters Limited 2001.

LONDON, May 17 (Reuters) - Electricity companies are flocking to build dozens 
of new power stations in Spain, attracted by surging energy demand and a 
looming shortfall in local electricity supplies. 
Spanish and foreign firms have proposed around 40 new gas-fired power 
stations although not all will go ahead, delegates heard at an energy 
conference in Madrid.
"How many of these projects get realised depends on the permitting 
process...and the capacity of the gas system," Agustin Llana, manager for gas 
and power at Shell Espana told the conference. 
Spain urgently needs the new power stations or it could face a crisis similar 
to that in California where power prices rocketed and the state suffered 
rolling blackouts, say analysts. 
Electricity demand has grown by 30 percent since the early 1990s while new 
generating capacity has risen just five percent. 
"If we look at new capacity needs, Spain needs between 1,000 and 1,500 MW a 
year at least," said Pedro Larrea, vice president of energy management at 
utility Endesa. 
Spain does not have any gas-fired generation at present and the lure of a 
lucrative "dash to gas" has prompted ambitious expansion plans by local 
utilities, who have until now relied on hydro, nuclear and coal, and ventures 
by independent power producers (IPPs). 
The new proposed combined cycle gas turbine (CCGT) power stations have a 
capacity of around 30 gigawatts and would raise Spain's existing capacity by 
two thirds if they all go ahead. 
FOREIGN NEW ENTRANTS LINE UP 
Of this total, more than 14 GW is proposed by large Spanish power utilities 
with around 10 GW from IPPs and the remaining four GW from other local 
companies. 
Industry experts say many projects will not get off the drawing board and 
only six to eight GW of capacity will in fact be built by 2004/2005. 
Spain is opening its electricity market to competition in line with a trend 
in the European Union. Fifty five percent of the sector is liberalised and 
the government plans full deregulation in 2003. 
Endesa and the other leading Spanish utility Iberdrola have 80 percent of the 
generation market between them with the rest divided between Union Fenosa and 
Hidroelectrica del Cantabrico. 
New entrants include Intergen, a joint venture between Shell and engineering 
firm Bechtel, and U.S. utilities Edison Mission Energy and Enron Corp. 
LOCAL UTILITIES START BUILDING POWER STATIONS 
Local companies are ahead in the permitting process which can take up to two 
years and involves getting over 20 local and national licences. 
Endesa, for example, has started building work on a 1,200 MW power station 
whereas no IPPs are believed to have begun building. 
"(Most) applications are from electricity utilities. We are in the queue but 
way down," said Erik Gustafson, manager of business development at Intergen 
which has plans to build a 1,200 MW plant at Catadau in Valencia. 
The main problems facing IPPs like Intergen are obtaining gas supplies, the 
linking of gas prices to oil rather than to electricity and government delays 
in issuing new gas transport terms, he told the conference. 
Spain has no gas supplies of its own and while the monopoly of Gas Natural, 
controlled by Repsol has been ended by the government, new entrants have been 
slow to make inroads into the market. 
"Financing depends on gas. The real key is whether the gas market can become 
more liquid," said Gustafson. 
Another worry for IPPs are Gas Natural's ambitions to move into generation 
with plans announced to build 4,400 MW capacity which could restrict gas 
supplies for new entrants. 
"If Gas Natural have 4,400 MW up and running, they will go to the top of the 
list and get all the (gas) capacity. We will be stuck in Valencia without any 
gas," said Gustafson. 
Spain's natural gas demand is expected to double to 35 billion cubic metres a 
year by 2010, with most of the growth from 2005 onwards from power generation.

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


Middle East flame burns ever brighter as exports hot up

05/17/2001
Lloyd's List International
18
Copyright (C) 2001 LLoyds List; Source: World Reporter (TM)

Exports of LNG from the Middle East - Abu Dhabi, Qatar and Oman - leapt 55% 
in 2000, climbing to 17.1m tonnes from 11.1m the previous year. 
Oman became the world's 12th LNG export nation during the year, despatching 
shipments to South Korea, the US, Japan and Spain.
The Middle East now accounts for 17% of all LNG exports, a percentage which 
will continue to grow in the years ahead. 
Not only are deliveries under long-term contracts with Japan and South Korea 
building toward plateau but also new purchase deals have been struck with 
India and negotiations are underway with a wide mix of potential customers. 
In March a third Qatari LNG company - Ras Laffan LNG Company 2 (Rasgas 2) - 
was established to supply gas to India. 
Rasgas 2 has signed a deal with Petronet of India to provide 7.5m tonnes of 
LNG per annum (mta) for a period of 25 years, commencing in late 2003. 
Two-thirds of the gas will be shipped to a new import terminal at Dahej in 
Gujarat state and the remaining third to Cochin in Kerala. 
Plans for a similar agreement with another Indian company, Dakshin Bharat 
Energy Consortium, are moving ahead. 
This calls for delivery of 2.6 mta to India for 25 years, also from 2003. 
Rasgas 2 will build two LNG production trains, each of 4.7 mta capacity, at 
its Ras Laffan complex to meet the bulk of this new Indian commitment. 
These trains, which will be the world's largest, will be constructed 
alongside the two 3.3 mta LNG trains by the original RasGas company. 
Rasgas 2 will be owned 70% by Qatar Petroleum and 30% by ExxonMobil, but the 
equity split will be slightly at a later stage to allow for taking a 5% 
share. 
Qatar has come a long way since the other LNG company, Qatargas, launthe 
country on to the world LNG stage in 1997 with its first shipment to Japan. 
Even after the Petronet deal - the world's largest LNG sale - there are no 
plans to ease back on developments. 
Last month Qatar announced it would sign a one-off deal with Spain for the 
sale of up to 1.5m tonnes of LNG. 
The Gulf emirate is also talking to Lebanon, France, Italy, China and Taiwan 
about the the possibility of export contracts that would total 12 mta. 
Qatar's LNG exports utilise gas from the offshore North Field, the world's 
largest single source of non-associated gas. 
In April 2000 Oman loaded its first cargo at the new Qalhat terminal - a 
shipment for South Korea. Oman LNG has contracts to supply Japanese and South 
Korean customers with 4.8 mta of LNG for 25 years, and has finalised a deal 
to provide 1.6 mta for India's Dabhol project. 
In addition, 17 cargoes are being delivered to Spain over a 14-month period 
ending in December 2001 under a one-off agreement. 
Several spot cargoes have also been shipped to the US, an activity which is 
likely to continue. 
Deliveries to Dabhol, for use in a combined cycle power plant, were due to 
commence at the end of 2001, but the project has run into difficulties due to 
a dispute over electricity pricing the state of and Enron, the developer of 
the power plant and LNG import terminal. 
This could jeopardise this facility - the largest gas-fired power plant in 
the world - and is the only dark cloud on what is otherwise an bright horizon 
for Middle East LNG.The future is bright: Qatar became the fourth largest 
exporter of LNG in 2000.

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


Enron Joins Alberta's Natural Gas Exchange

05/16/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)

CALGARY -(Dow Jones)- A battle for better representation of natural gas 
trades on Alberta's primary electronic exchange has been resolved between NGX 
Canada Inc. and Enron Canada Corp. 
Enron, a subsidiary of of Houston-based Enron Corp. (ENE) and the largest 
natural gas marketer in Alberta, will start entering real-time data into 
NGX's system by August, expanding the exchange's database to a more realistic 
one, spokesman Eric Thode told Dow Jones Newswires Wednesday.
In turn, the marketing giant has withdrawn a C$101 million law suit against 
the Alberta exchange, and two other electronic trading companies claiming 
that NGX skewed price indexes by using only that exchange's data, and caused 
Enron to lose millions of dollars. 
"We felt that NGX was not giving a true picture of the Alberta gas market and 
that had a monetary impact on trade indices," Thode said. 
Enron sells approximately 7 billion cubic feet to 7.5 Bcf a day of Alberta 
gas compared to an average 1.5 Bcf a day traded on NGX. 
The marketer will trade data from its EnronOnline daily spot, one-month spot 
and bid-week spot gas transactions with NGX, starting in August once the two 
houses implement the necessary system adjustments. Industry will receive a 
30-day notice of the market change. 
Including Enron's data will substantially improve the quality of NGX's 
indexes, said president Peter Krenkel. 
"The more data that is in the index computation, the more representative the 
index is of the market and then more comfortable clients are in using it to 
settle contracts," Krenkel said. 
The exchange, a subsidiary of OM Gruppen AB of Sweden, an international 
exchange operator, had been restricted to deals conducted on NGX after buying 
Canadian Enerdata Ltd.'s day, month and bid-week spot gas price indexes last 
September, he explained. 
Now NGX will include Enron's immediate, real-time transactions off of data 
feeds between EnronOnline and the Alberta exchange. Enron clients will have 
the option to trade on either or both exchanges, Krenkel said. 
The Alberta exchange will compute the index from all data received on a 
weighted-average basis. 
Traders in Calgary, seat of the Canadian natural gas industry, were 
encouraged to hear Enron's transactions and volumes will flow straight into 
the NGX system because of concerns the marketer would not provide immediate 
volumes. 
"I just want to make sure we see where the real-time volumes are," one trader 
said. "The more trades we get in, the better for a better-weighted index." 
An independent auditor hired by NGX will monitor the system on a regular 
basis for irregular trading activities. 

-By Dina O'Meara, Dow Jones Newswires; 403-531-2912 dina.omeara@dowjones.com

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


Enron could lose Brazil environmental lincence - Rio state official

05/16/2001
AFX News
(c) 2001 by AFP-Extel News Ltd

SAO PAULO (AFX) - Enron Corp's environmental license may be withdrawn if it 
suspends investments of 600 mln usd in the expansion of two thermoelectric 
plants, news agency JB Online quoted Rio de Janeiro state energy, naval 
industry and petroleum secretary Wagner Victer as saying. 
"There are no reasons to worry because if Enron doesn't do it (invest), 
another company will... Not only will they lose an excellent deal but they 
will also lose their environmental license," JB Online quoted Victer as 
saying.
Yesterday, Enron vice-president and Eletricidade e Servicos SA Elektro 
chairman Orlando Gonzales said the company is suspending investments in the 
Brazilian energy sector due to the lack of clear regulations for the sector. 
mg/as For more information and to contact AFX: www.afxnews.com and 
www.afxpress.com

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


Creditors' of PG&E's Utility Form Information Clearinghouse
2001-05-16 19:13 (New York)

Creditors' of PG&E's Utility Form Information Clearinghouse

     San Francisco, May 16 (Bloomberg) -- A panel appointed to
represent the interests of creditors in PG&E Corp.'s Pacific Gas
and Electric unit's Chapter 11 bankruptcy reorganization created a
clearinghouse for news and information on the case.
     The clearinghouse will be managed by Rogers & Associates, a
Los Angeles-based public relations firm. The firm will distribute
news and statements, the creditors' committee said in a statement.
    The clearinghouse was established  ``to ensure that the media
has a source of timely and reliable information,'' the creditors'
committee said.
     Pacific Gas & Electric filed for bankruptcy on April 6 after
running up $9 billion in losses buying electricity for more than
it could charge customers. Under California's deregulation laws,
wholesale power prices were allowed to float while customer rates
were frozen. The filing was the largest ever for a utility and the
third-largest Chapter 11 case in U.S. history.
     On April 10, the U.S. Trustee in San Francisco appointed a
committee of 11 unsecured creditors to represent the interests of
the estimated 30,000 companies and individuals with claims against
Pacific Gas.
     The members of the creditors' committee are: KES Kingsburg
LP, Dynegy Power Marketing Inc., Enron Corp. and affiliates, the
City of Palo Alto, the State of Tennessee, GWF Power System,
Merrill Lynch & Co. Inc., Bank of America Corp.'s Bank of America
N.A., The Davey Tree Co., U.S. Bank, and The Bank of New York Co.
Inc.
     Parent company PG&E shares fell 52 cents to $11.00 on the New
York Stock Exchange.

--Jeff St.Onge in San Francisco (415) 743-3534
jstonge@bloomberg.net through the San Francisco newsroom/gcb