Re: Post-Close Storage Settlement

Please read the e-mails below. I don't have any problem handling this the
way Tim has suggested, but since you've been working on the storage balance
issues, I thought I'd ask you if there's any reason you can see not to do it
this way. Please advise.....

---------------------- Forwarded by Colleen Sullivan/HOU/ECT on 09/12/2000
08:53 AM ---------------------------

Timothy L Ray@EES
09/08/2000 12:26 PM
To: dkinney@columbiaenergygroup.com @ ENRON
cc: jporte1@ceg.com, Michael H Garred/HOU/EES@EES, Dave Scott/HOU/EES@EES,
Colleen Sullivan/HOU/ECT@ECT
Subject: Re: Post-Close Storage Settlement

Doug;

I really don't want to go down the road of putting together any more side
letter agreements. They are too time consuming. I really feel that we
should have no problem forwarding to you our electronic communications with
ENA confirming the storage volume. You can use this as a basis to complete
your billing reconciliations. I will promise to forward to you all of the
volume confirmations that we have with ENA for July 31 injections.

Colleen;
I don't have your view. If you want to do a side letter, as was completed
for the hedges, let us know. However, if you all don't feel strongly about
this, then I am inclined to carry on as I described above.

dkinney@columbiaenergygroup.com on 09/08/2000 08:57:32 AM
To: " - *tray@enron.com" <tray@enron.com<
cc: " - *Snyder, Dan" <dsnyde1@columbiaenergygroup.com<, " - *Porter,
Jeffrey" <jporte1@columbiaenergygroup.com<
Subject: Post-Close Storage Settlement

Tim--With regard to the Post-Close Storage Settlement between NPC and CES, the
situation is that we are waiting on final, correct invoices from ENA showing
the volumes injected for the 4 theoretical storages (TCO, Transco WSS, Transco
ESS, and Sonat CSS). We would also like ENA to agree in some written format
as to the July 31 volumes in each of these storages, where these volumes
reflect the April 1 starting inventory that was left over from last winter.
If
these final numbers from ENA agree with the values that Jeff Porter put in the
latest version of the storage exhibit to the purchase agreement, that is
fine. To the extent that ENA has invoiced CES for a different amount(s), CES
will resolve those differences with ENA. (We know that there are some
differences, as shown in the attached spreadsheet.)

I have asked Chris Germany at ENA to work with us to get this resolved, and he
has agreed to do so. However, it might help expedite things if you can weigh
in with Chris or with Colleen Sullivan as well. Please let me know if you
have questions, etc. I am going to be out of the office for at least the next
few days, but I will be checking my e-mail and voice messages periodically.

Thanks.

Doug Kinney
Ph: 703-561-6339
Fax: 703-561-7317

- Post Close Stg settle.xls