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Enron Mail |
Tim, my understanding is that partnership fee (the $11.0M) has been amortized
for the last several years and expensed to the Industrial groups (McConville and Ondarza). As you are aware, I sued them for breach. The settlement involved the elimination of all existing transactions between Ft. James and Enron including the Wauna and Halsey power contracts. It is my understanding that the benefit of the elimination of those shorts resides in the Portland shop. The elimination of the shorts would not have occurred without the lawsuit on the alliance and the settlement I originated. It seemed logical to charge the Portland office with the remaining un-amortized fee of $1.8M as a cost of eliminating the shorts for no cost and no future contingent liability. Lets discuss. Regards Delainey ---------------------- Forwarded by David W Delainey/HOU/ECT on 06/16/2000 07:00 PM --------------------------- From: Tim Belden 06/16/2000 05:09 PM To: Wes Colwell/HOU/ECT@ECT, David W Delainey/HOU/ECT@ECT, John J Lavorato/Corp/Enron cc: Paula Harris/HOU/ECT@ECT Subject: Fort James Amortization Edith Cross and I looked at the Fort James deal in great detail in early 1999. When the deal was closed, west power trading booked an in the money position and an offsetting expense of about $11 million. This money has already liquidated from our book. In fact, I have a copy of the 3/31/97 DPR that reflects this liquidation. At that time, west power trading also paid a 350k credit reserve, 247k to the finance book, and 1.3 million in origination. I have also heard about a "partnership" fee that Enron paid to Fort James around the same time. I'm not sure what this fee was and who benefitted from it. It had nothing to do with the west power trading book. On John's recommendation I called Wes to see if we could figure this out. Wes, please give me a call back to discuss. I think that someone needs to look at the actual journal entries from March of 1997 to see why an expense of $11 million was deferred. This is not my problem. I should not receive this expense. Until this is resolved, I would greatly appreciate it if the writedown of the deferred account does not hit west power trading's expenses.
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