Message-ID: <21315452.1075845532734.JavaMail.evans@thyme> Date: Tue, 23 May 2000 07:41:00 -0700 (PDT) From: kevin.mcgowan@enron.com To: george.mcclellan@enron.com Subject: Emissions positions Cc: john.lavorato@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Bcc: john.lavorato@enron.com X-From: Kevin McGowan X-To: George McClellan X-cc: John J Lavorato X-bcc: X-Folder: \John_Lavorato_Oct2001\Notes Folders\All documents X-Origin: LAVORATO-J X-FileName: jlavora.nsf We are moving forward to transfer the positions from the emissions books (SO2 and NOx) to the coal group at close of business 5/23/00. The SO2 marks for both the underlying and volatility positions currently in the 2007 through 2010 timeframe create a value differential of $2.6 million between our evaluation and their marks. For the sake of not continuing the unproductive task of negotiating this value, we will move forward to transfer despite our differences. I strongly recommend continuing to use and pay for all personnel in risk, documentation and settlement that currently perform these duties for emissions. I would like to utilize these resources until further notice. I am not comfortable committing to any transfer of risk, documentation and settlement duties until we have the time to evaluate this further. I would appreciate if you could help on this matter to ensure a smooth transition. KJM