Subject: Siemens - Westinghouse 31 Jan AM Update.
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked]
Date: Wed, 31 Jan 2001 06:13:00 -0800 (PST)

1.   Met with Ron Tapscott, Jim Studdert and Scott Laidlaw, primary subject 
insurance claim status.  Scott Laidlaw gave Jim a letter from Siemens in 
which Siemens says the generator is a total loss (or cost to repair is 
greater than a new one).   Jim will use this to give to the adjustor to get 
the survey and adjusting process going again.   Jim needs a point of contact 
at Westinghouse to get access to the generator and get it unboxed for the 
adjustor to look at.   The generator that is shown in the report is the 2nd 
generator in the hold and is not ours.  Apparently our generator has not been 
unboxed and thus not directly observed.   Rumor has it that the water line is 
not as high on the Enron box as it was on the box of the generator that is 
not Enron's.

In my conversation with Mark T this morning I asked him for the name and 
telephone number of the Westinghouse point of contact for the adjustor so 
that the adjustor can arrange to see the generator.   He stated he would have 
SW PM provide us that point of contact.   I will sent Mark an Email reminding 
him of such.

At the risk of making anyone or everyone nervous- but I think it is important 
for everyone to understand, I believe getting the pay-out value from the 
insurance adjustor is a vital element of the Calpine- SW deal.   If the 
adjustor comes back with something less than the replacement value (other 
than the deductible) because he asserts that the generator was not (as a 
result of the water- but is now because it sat in a box unattended) a total 
loss, or presently is not  viewed as a total loss then SW will go to full 
battle stations asserting the loss occurred when Enron had risk of loss and 
damage.

2. Mark T and I talked status.    Mark T asked if we thought that Calpine 
would buy the Unit.   Mark T indicated that he spoke with Mike Costa and per 
Mike C SW is one to two days away from reaching a deal with Calpine on the 
Nov Unit.   I queried Mark on whether SW has other customers for the Nov 
Unit.   He was properly evasive, indicated that SW did not, but said 
opportunities always come along.  Mark T indicated he questioned whether the 
April delivery would work for Calpine- he agreed that an April delivery of 
the generator would get them on line in time, but as he saw it he wondered if 
Calpine had an engineer in line to build the plant.   In the midst of the 
conversation he wondered whether NEPCO would even have the capacity to get it 
on line given other work.   I  am not sure whether that was a deliberate 
query to see if we were interested in having NEPCO build the plant.

Ben  Summary of conversation-  if we Enron as sure we have a sale with 
Calpine, then I think Mark was saying we can do the deal.   I think the ball 
is our court to flush out Calpine  (am I spelling it correctly?)- within the 
next 24 to 48 hours.

3.  Update on expedited shipment by air.   Cost would be in the order of 
magniture of $275,000  +/-  (versus $30- $50K by vessel) , problem- latest 
information is that as configured it will not fit on an airplane.  We had 
people looking to see if anything can be taken off the generator to get it on 
the airplane.   I mentioned this to Mark T, he questioned airplane transport 
in that he felt SW transportation people would have already suggested it.

4.  Ron and James.   I queried Mark T to determine whether  SW had gone after 
the shipper.  I put it in the context that we did not want to inadvertently 
upset what SW might be doing with the shipper.  He did not know.  I doubt we 
will get any information on that front.