Message-ID: <758.1075842602845.JavaMail.evans@thyme> Date: Tue, 25 Jul 2000 02:45:00 -0700 (PDT) From: gerald.nemec@enron.com To: joan.quick@enron.com Subject: Re: Wildhorse Letter Cc: scott.josey@enron.com, barbara.gray@enron.com, brian.redmond@enron.com, dan.bump@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Bcc: scott.josey@enron.com, barbara.gray@enron.com, brian.redmond@enron.com, dan.bump@enron.com X-From: Gerald Nemec X-To: Joan Quick X-cc: Scott Josey, Barbara Gray, Brian Redmond, Dan J Bump X-bcc: X-Folder: \Gerald_Nemec_Dec2000_June2001_1\Notes Folders\All documents X-Origin: NEMEC-G X-FileName: gnemec.nsf Joan, The contract states that Wildhorse only has to accept gas from Crescendo that the downstream carriers will accept. Per Brett Frie at Enogex, the Entrada production is 24% Nitrogen. Until the plant is up and running, this gas will not meet any of the downstream carriers specs. I am not sure how we get the Nitrogen out of the gas stream without the plant? The Dakota production was not mentioned in the letter, because I have no facts about the gas quality of this gas. You had forwarded emails last week indicating the Dan Reineke was to take samples at the wellhead and downstream of Wildhorse's plant. Once we have these facts we can send a letter concerning the Dakota. Do you have any info on these samples? Joan Quick 07/24/2000 07:17 PM To: Gerald Nemec/HOU/ECT@ECT cc: Scott Josey/Corp/Enron@ENRON, Barbara N Gray/HOU/ECT@ECT, Brian Redmond/HOU/ECT@ECT, Teresa G Bushman/HOU/ECT@ECT, Dan J Bump/DEN/ECT@ENRON Subject: Wildhorse Letter Per the drafts, we are asking "Wildhorse to accept all gas delivered.... upon startup of the Treating Plant." I thought the purpose of this letter was to get Wildhorse to take all of our gas right now, not just after the plant is started up. Is this not so? I agree with Dan, that this letter only discusses the Entrada gas, with no mention of the Dakota curtailment, which I think it should. I had just a couple minor changes... To: Gerald Nemec/HOU/ECT@ECT cc: Joan Quick/HOU/ECT@ECT, Scott Josey/Corp/Enron@ENRON, Barbara Gray@ECT, Brian Redmond/HOU/ECT@ECT, Teresa G Bushman/HOU/ECT@ECT Subject: Re: Wildhorse Letter Gerald -- I have provided a few coments (redlined) to your draft letter attached below. However, I wanted to offer the following ideas for discussion with you and the others listed above as to potential inclusion in the Wildhorse letter: A. Should we request written notification from Wildhorse related to the shut-in status of Entrada production? Should we request written notification related to the recent curtailment of Dakota production? [As we've discussed, Enogex never requested anything in writing from Wildhorse, so we do not have any historic documentation of Wildhorse's claims]. B. Should we identify (potential) contractual issues due to the curtailment of Dakota production; e.g. Sec. 6 detailing the (wellhead) delivery pressure requirements under this contract, et al? [As we've discussed, the system pressures have increased due to (initially) gas being re-routed by Wildhorse over the past two years which has loaded the San Arroyo system, and now the NWPL quality issues and subsequent Wildhorse curtailments has increased pressures system-wide. If Wildhorse based their ability to allow these problems to persist by referring to Sec. 7 "Gas Quality" of the agreement, what remedies can we request....partial release of Dakota gas?]. Here's the frustration, based on conversations with producers in the area and the documents we've received from Enogex, Wildhorse has continued to attach non-pipeline quality spec gas to their system over the past couple years to increase gathering revenues, yet has not invested any $$$ for processing of this gas to meet or exceed the specs of downstream pipelines. Then, they use the downstream pipes as the reason for shutting in all their captive producers, and have thus far offered no solutions to the system pressure and quality issues discussed above. Therefore, its critical that this letter gets to the "right" people within Wildhorse and, if possible, make reference to some element of timing (e.g., reasonable dispatch, commercially reasonable manner, etc.). Thanks. Dan