Subject: RE: TGS Booking
From: [email-masked]
To: [email-masked]
Date: Fri, 30 Mar 2001 07:42:44 -0800 (PST)

ok

 -----Original Message-----
From: 	Collonges, Remi  
Sent:	Friday, March 30, 2001 9:30 AM
To:	Lavorato, John; Kishkill, Joe
Cc:	Freyre, Rodolfo; Martha Stevens@ECT
Subject:	Re: TGS Booking

John, Joe,

We are ready to book the TGS capacity for the next 13 months (April 01-April 02 included) - rationale of the 13 months: winter season starts in May.

We chose a conservative approach to book all capacity that was not sold yet against our monthly demand payments.

As of today, impact is a loss of $2.5 million.

However Rolo closed successfully the Profertil transaction (13 month, sale of 175,000 cm/d delivered in Bahia Blanca).  Contract is apparently already signed by counterparty and will reach our office in BA by Monday (they already nominated April 1st gas).  When we book this transaction, TGS capacity position drops to a loss of $700K only.

For the sake of earnings stability, I therefore recommend that we postpone the booking of TGS position until Monday when we get the Profertil contract in hand.  The following will happen:

TGS Transport: loss of $700K plus reversal of Jan-Mar losses on TGS ($800K loss will be moved from Gas trading to TGS transport).
Gas trading Profertil: gain $160K (approximately)
Gas trading Chevron (to supply commodity to Profertil): gain of $100K approximately.

We negotiate with Camuzzi to sell them the optionality (15 day interruptibility) that we obtained from Profertil.
We are left with some summer excess capacity that we will try to sell a best price.

Let me know if you agree with my timetable.

Remi

 
Rodolfo Freyre
03/30/2001 11:53 AM
To:	Remi Collonges/SA/Enron@Enron
cc:	Martha Stevens/HOU/ECT@ECT 
Subject:	TGS Booking

Remi,

We need to decide how and when to book the TGS FT Capacity. If we only book the current deals we have (5 P customers, Renault and Bagley), the MTM Book loss will be $2.5MM (booking 13 months - starting April 1st, 2001 thorugh April 30th, 2002).

If we decide to book Profertil, then the MTM Book loss will be $700K (instead of the $2.5MM). Additionally, we still have 15 days of optionality in the Profertil contract that we have not booked and could be valued at approximately $250K depending on how the negotiations I am carrying out with Camuzzi (LDC) end. 

Chevron will also add another $100K to the MTM book.

Keep in mind that the YTD gas book is ~$800K down due to the TGS demand charges during Jan, Feb and March.

Please advise on what and how you want us to book these different deals (keep in mind in mind Q1, Q2,....).

Tks,

Rolo

 << File: TGS MTM 0328.xls >> 

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