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Enron Mail |
The email below is for your follow-up and information. John
---------------------- Forwarded by John Shafer/OTS/Enron on 02/23/2001 07:32 AM --------------------------- Edward_Attanasio@eott.com on 02/22/2001 01:31:30 PM To: Dana_Gibbs@eott.com cc: Bob_Jacobs@eott.com, John_Shafer@Enron.com Subject: Re: Rogas Line -- USFW Approval I don't know the exact cost number for compensation acreage, but the following info may help for planning purposes. (Also, I don't know if any number for such acreage was included in the cost figures presented to the Board; presumably some estimate was included.) There are two different types of compensation credits we will need to purchase: Coles Levee Ecopreserve (CLEP) credits, and Kern Water Bank (KWB) credits. For KWB, we will need 24 acres to start the project. From the figures I have been quoted, these should cost $62,000. This is only for installation of the new lines, however, and does not include acreage to cover removal of the existing line. (I will not here hazard a quess as to how many additional acres this will require, but it could well be that same amount again, as the lines are the same length.) The Enron folks can determine the actual number. For CLEP, we need 15.3 acres. While our take permit only requires us to post a letter of credit for $16,500, in lieu of immediate purchase, as security to ensure we will follow through with the actual purchase, I believe the actual cost of buying the credits will be higher -- perhaps three times that amount, because the market for these credits has firmed substantially since Koch was issued that permit. Again, the Enron folks can give us a hard number once they get an actual quote from Aera or some other seller. So, I believe we are looking at a best case of about $100,000, and worst case of $175,000 for purchasing compensation acreage. John, do you agree? Thanks. --ETA Dana Gibbs To: Edward Attanasio/Remote/Eott@Eott, Bob 02/22/01 Jacobs/Long_Beach/Eott@Eott 07:06 AM cc: John_Shafer@Enron.com Subject: Re: Rogas Line -- USFW Approval What if any cost impact does this have on EOTT. Make sure we get the capital approved and that we (EOTT) are aware of the cost. The cost of the project has been approved by the Board and if I need to go back to them with a revised economic analysis, I will need some time. This goes for the truck rack as well. Dana ----- Forwarded by Dana Gibbs/Houston/Eott on 02/22/01 09:06 AM ----- Kenny Maltby To: John Shafer/OTS/Enron@ENRON 02/21/01 05:11 cc: Bob_Jacobs@eott.com, Dana PM Gibbs/Houston/Eott@Eott, Edward Attanasio/Remote/Eott@Eott, Larry_Campbell%Enron@EOTT.COM, Lawrence Clayton/Houston/Eott@Eott, Louis Soldano/Enron@EnronXGate, Matt_Hughes@eott.com, Molly_Sample@eott.com, Phil Lowry/OTS/Enron@ENRON, Rich_Jolly%Enron@EOTT.COM, Scott Jones/Bakersfield/Eott@Eott, William Kendrick/OTS/Enron@ENRON Subject: Re: Rogas Line -- USFW Approval (Document link: Dana Gibbs) I obtained a copy of a letter sent to Gary Fuller from the Department of Fish and Game on November 3, 2000. In the letter the Fish and Game agreed EOTT has 41 Acres of conservation credits based on Arco Western Energy's sale of the North Coles Levee fractionator plant and premises to Koch Oil and Gas, and Koch's subsequent sale of the plant and premises to EOTT ENERGY. In the letter the following limitations and clarifications were listed: Because the conservation credits may be used for mitigation of EOTT impacts, or sold by EOTT to third parties for their own mitigation needs, EOTT must affirm that it will conform to the Department's standards for sale of conservation credits as well as management of the credit lands. These obligations are already implied by the chain of Koch's and then EOTT's acquisitions of the North Coles Levee fractionator plant. EOTT and Department representatives will need to meet to discuss these details and determine the most efficient means to implement these conditions. Key provision of the obligations that attend using the conservation credits include Department approval of third-party sales; minimum endowment requirements for all credit sales; management and monitoring of habitat conditions; and additional mitigation for disturbance to dedicated habitat. Habitat continuity and small animal movement between the North Coles fractionator plant site and the remainder of Coles Levee Ecosystem Preserve must be provided in order to maintain viability of the habitat within EOTT's holdings. Although it appears we do have the credits for NCL, I do not know if Gary ever met with the Fish and Game to discuss the details or means to implement the conditions for use of the conservation credits. With the project set to start we may have to purchase the 15.3 acres of credit from Area. John Shafer@ENRON To: Kenny Maltby/Bakersfield/Eott@Eott, Scott Jones/Bakersfield/Eott@Eott 02/21/2001 cc: Matt_Hughes@eott.com, 05:50 AM Bob_Jacobs@eott.com, Molly_Sample@eott.com, Larry_Campbell%Enron@EOTT.COM, Rich_Jolly%Enron@EOTT.COM, Lawrence Clayton/Houston/Eott@Eott, Dana Gibbs/Houston/Eott@Eott, Louis Soldano/Enron@EnronXGate, William Kendrick/OTS/Enron@ENRON, Edward Attanasio/Remote/Eott@Eott, Phil Lowry/OTS/Enron@ENRON Subject: Re: Rogas Line -- USFW Approval (Document link: Kenny Maltby) Kenny and Scott, I agree with Ed's note concerning the need to move expeditiously in the purchase of compensation acreage noted by the US Fish and Wildlife Service (Service) in there approval letter. This in indeed "good news" and EOTT must move ahead to fulfill its obligation as per the MOU and Incidental Take Permit. By copy of this email, I am asking Larry Campbell to work with both of you to assist in the proper fulfillment of EOTT's obligation as promptly as possible. It is also my understanding, from what research I have been able to do, that EOTT does have approximately 14 to 15 acres of credit at the North Coles Levee Preserve. You should verify the exact credit number and furnish the Service with such verification. That is acreage EOTT will not have to purchase in satisfying the obligation of the permit. Keep me posted as you move forward on this issue. John Shafer Edward_Attanasio@eott.com on 02/20/2001 07:49:31 PM To: Kenny_Maltby@eott.com, Scott_Jones@eott.com cc: Matt_Hughes@eott.com, Bob_Jacobs@eott.com, Susan_Ralph@eott.com, Molly_Sample@eott.com, Larry_Campbell%Enron@EOTT.COM, Rich_Jolly%Enron@EOTT.COM, John_Shafer@Enron.com, Louis_Soldano%Enron@EOTT.COM Subject: Rogas Line -- USFW Approval Randi McCormick just forwarded to me a letter addressed to EOTT, dated February 14, 2001 from the US Fish and Wildlife Service approving our project "for participation in the Kern Water Bank Compensation Bank," and authorizing the Water Bank "to extend their incidental take authority to you and your entire project under their Master Permit." This is, of course, very good news. The letter notes, however, that we still need to purchase compensation acreage both at North Coles Levee and at the Kern Water Bank. Specifically, we must do the following: (1) contact Cheryl Harding of Kern Water Bank to acquire 23.1 acres of compensation credits, and to get included in their Master Permit; and (2) get Cheryl Harding a letter from the Coles Levee Ecosystem Preserve (Mark Poe of Aera) stating that we have purchased 15.3 acres of credits for North Coles Levee, or that we have set aside that amount from credits we have in the past purchased. While I could make these contacts, I do not believe that would be wise because -- as Kenny can attest -- our past experience has been that whenever a lawyer contacts the Water Bank, it prompts them to automatically get their lawyers involved. And our experience has been that this only slows things down -- or worse. My suggestion therefore is that one or both of you gentlemen contact Cheryl as soon as practical and ask her for (1) proposed contract for acquisition of 23.1 acres of compensation credits and (2) perperwork to include EOTT (and its contractors) in their Master Permit. She should also be informed that, while we have not yet purchased the 15.3 acres of NCL credits, we will by the end of this week have a letter of credit posted as security, as allowed under our State Take Permit, to cover this amount of acreage. Ask whether a copy of this LC will suffice for her purposes, or whether we will need to have the actual acreage purchased. As this would remove a major impediment to construction of the new lines, it is important that we move on this will all deliberate speed. Please call me if you have any questions, or if you would like otherwise to discuss how to approach this issue. Thanks a lot. --ETA
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