Re: gas hedging pilot program in Ohio

Thanks Kerry. I have already had preliminary discussions with Dominion/East
Ohio and NiSource/Columbia; however, I think your idea to get a meeting
Schriber is excellent. I would like to get all the Ohio utilities freed-up to
look at hedging programs so that ENA can provide risk management services.

Keep me posted and let me know if I can do anything for you.

Kerry Stroup
05/25/2001 10:21 AM

To: James D Steffes/NA/Enron@Enron, Roy Boston/HOU/EES@EES, Susan M
Landwehr/NA/Enron@Enron, Phil DeMoes/Corp/Enron@ENRON, Russell E
Murrell/Corp/Enron@Enron, Gil Muhl/Corp/Enron@ENRON, Lisa Yoho/NA/Enron@Enron
cc: Janine Migden/NA/Enron@Enron, Richard Shapiro/NA/Enron@Enron
Subject: gas hedging pilot program in Ohio

On Wednesday, Ohio PUCO Chairman Alan Schriber revealed in testimony to the
House Public Utilities Committee that the Commission is considering putting
in place a pilot program for the coming heating season in which gas utilities
could hedge gas cost exposure. Subsequently I learned from the PUCO staff
that Schriber had met with them the day before, at which time staff
advocated that hedging be facilitated. I also learned that staff has been in
discussions with East Ohio Gas/Dominion on the same subject, and that this
was the impetus for staff's discussion with Schreiber.

Although the Commission has taken no formal action at this point, staff
contacts advise that something will likely take shape over the next several
weeks, and conceivably that other gas utilities may be involved. In the
meantime, it may be expedient to meet with Chairman Schriber to position
ourselves to take advantage of this opportunity -- by advocating a broad
extension of the program to other gas utilities as well as program-specific
features, e.g. leveraging our weather derivative products. If there is
interest, I would be happy to arrange a meeting with him. And, given
Dominion's interest, we may wish to be in contact East Ohio Gas.