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Enron Mail |
Not to be too obvious in all of the mess noted below but a little further f=
raming of the issue seems appropriate. =20 The project has a total return swap structure in place. We also have a pot= ential sale of the project underway which could result in a significant pos= itive amount being distributed to the estate. How we handle the matter Ric= k notes below could impact our continuing involvement in the sales process = and ultimately effect our ability to realize the distribution. =20 Chuck -----Original Message----- From: Hill, Garrick=20 Sent: Thursday, January 31, 2002 3:12 PM To: Sewell, Doug; Schneider, Chip Cc: Parks, Joe; Boyt, Eric; Armstrong, James; Ward, Charles Subject: RE: Tenaska Service Agreement=20 The desk has, since September 2000, provided "agency services" to the Clebu= rne, TX facility (owned by Ponderosa Pine Energy Partners, Ltd., f/k/a Tena= ska IV Texas Partners, Ltd., which is owned by ECTMI (10%) and Ponderosa Pi= ne Energy, LLC (90%), or "PPEP"). Agency services include gas scheduling/r= econciliation, purchase/resale, and billing/payment of services provided un= der three contracts to which Ponderosa Pine Energy Partners is a party: Lone Star - transport=20 Apache - supply=20 Williams - supply An agreement covering these services was developed by Sandy Braband (no lon= ger here) and never executed. The desk received a fee of ~4.5 cents/Dth fo= r the services. =20 Based on my conversations with James Armstrong, it appears that pipeline ch= arges billed by Lone Star between April and September 2001 were billed by t= he desk to the project. The project forwarded funds to the desk for paymen= t of the Lone Star invoices, but the funds never went to Lone Star. The to= tal amount still due Lone Star for the period is $515, 985.41. As the cont= ract is between Lone Star and PPEP, the amount due must be settled in order= to prevent defaults under the project-level loan agreement. I believe a r= equest has been submitted to you for payment of the total amount due. My q= uestion is can the estate pay the amount due Lone Star or will the project = need to remit funds directly to the pipeline and file a claim against the e= state (effectively double-paying the amount due)? To the extent it's the l= atter, it's the upstream parties (i.e., KBC/Delta Power) that will have an = issue with what's happened, as any amounts trapped by the desk (and paid, f= or a second time, by PPEP) essentially come out of future cash distribution= s from the project company. =20 FYI, this is not the only issue that has arisen as a result of this arrange= ment. According to James, the project company also paid the desk for Octob= er 2001 pipeline charges billed by Lone Star and subsequently paid the pipe= line directly ($108,405) and is owed $600,377.50 for November 2001 gas sale= s made on behalf of the project. We're also aware that a large imbalance h= as built up on Lone Star; Joe Parks is looking into taking care of this pro= blem while we're determining what DPC/Delta Power wish to do with respect t= o gas management going forward. =20 Please call me at x3-6027 if you have any questions. =20 RH =20 =20 =20 =20 -----Original Message----- From: Sewell, Doug=20 Sent: Thursday, January 31, 2002 1:13 PM To: Hill, Garrick Cc: Schneider, Chip Subject: FW: Tenaska Service Agreement Can you get Chip and myself up to speed on this? -----Original Message----- From: Martin, Thomas A.=20 Sent: Thursday, January 31, 2002 12:41 PM To: Sewell, Doug Subject: RE: Tenaska Service Agreement We can try. The guy who managed this deal for the desk left the Company bu= t I thought he handed it off to Rick Hill in the estate. I will talk to th= e rest of the guys on the desk and find out what we have on it and call you= . My basic understanding of this deal is that we provided services only an= d are agent for the plant. I believe Rick Hill is the commercial contact o= n the deal so he should be able to provide more insight to the whole deal. = I will get back to you. =20 Tom -----Original Message----- From: Sewell, Doug=20 Sent: Thursday, January 31, 2002 9:20 AM To: Martin, Thomas A. Cc: Miller, Don (Asset Mktg); McMichael Jr., Ed; Schneider, Chip; Wynne, Ri= ta Subject: Tenaska Service Agreement Hey Tom, Rita Wynne just called and let me know that we need to make a payment to TX= U on behalf of Tenaska. Since TXU has terminated agreements with us, the C= ash Management Committee will not make payments to TXU unless they understa= nd the deal that is in place with Tenaska and we show that Tenaska has alre= ady paid us their part. Could you please help Chip Schneider, of Enron Und= erwriting, and myself get up to speed on this as quickly as possible. TXU = is threatening to take action on Tenaska. Thanks for your help. =20 Regards, =20 Doug Sewell 3-6337
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