FAS 133 response

Paige - I can be more argumentative here but if it's not going to make any
difference in the outcome, I don't really see the point. Let me know if you
disagree.

While a commodity forward contract which contains an asymmetrical default
provision clearly does not have the characteristic of net settlement, we do
not believe that Statement 133 is appropriately applied to any contract which
requires the making and taking of delivery of a physical commodity absent a
default, regardless of whether the default results in a termination payment
which may be payable to the defaulting party. An event of default and
resulting termination of a commodity contract can have far reaching negative
implications for the defaulting party well beyond the terms of the contract
itself (e.g. damage to reputation and credit, triggering of cross-defaults,
etc.).