Subject: Re: Pastoria PSA
From: [email-masked]
To: [email-masked], [email-masked]
Cc: [email-masked], [email-masked]
Date: Thu, 8 Mar 2001 03:19:00 -0800 (PST)

I would include language which also obligates Calpine to take assignment of 
the Precedent Agreement with Kern and any associated firm transport contracts 
and to meet Kern's credit requirements in doing so.  I would propose the 
following in addition to the Guarantee language;

Calpine agrees to satisfy any requirements of Kern River and execute any and 
all documents as may be reasonably necessary to effectuate, as of the 
Closing, the permanent assignment/release  from Enron North America Corp. to 
Calpine of (i) that certain Precedent Agreement for Firm Transportation 
Service between Enron North America Corp. and Kern River dated _______, 2001 
(the "Precedent Agreement") and/or (ii) any firm transportation agreements 
entered into in accordance with the Precedent Agreement ((i) and (ii) 
collectively referred to as the "Kern Transport") such that Kern River (a) 
agrees to look solely to Calpine for all obligations with respect to the Kern 
Transport and (b) unconditionally releases ENA from all obligations for 
demand/reservation charges, and all other charges related to the Kern 
Transport.   

Obviously there is still the risk that if Calpine doesn't close or meet Kern 
River's credit requirements, then ENA is still left holding this contract.  
If you have any question, please contact me at (713) 853-3512.

	Ron Coker@ENRON
	03/07/2001 07:17 PM
		 
		 To: Stephanie Miller/Corp/Enron@ENRON, Barry Tycholiz/NA/Enron@ENRON, Gerald 
Nemec/HOU/ECT@ECT
		 cc: Karen E Jones/HOU/ECT@ECT, Andrew Kelemen/HOU/ECT@ECT
		 Subject: Pastoria PSA

Here's the PSA language.  Sorry.

(a)   Buyer agrees to obtain the release of Seller under Seller's guarantee, 
dated [_____], in favor of Kern River Gas Transmission Company effective as 
of the Closing, and in furtherance thereof, agrees that Buyer shall either 
provide its own guarantee in favor of Kern River Gas Transmission Company or 
such other form of security as shall be acceptable to Kern River Gas 
Transmission Company in order to obtain such release.

----- Forwarded by Ron Coker/Corp/Enron on 03/07/2001 07:16 PM -----

	Ron Coker
	03/07/2001 07:16 PM
		 
		 To: Stephanie Miller/Corp/Enron@ENRON, Barry Tycholiz/NA/Enron@ENRON, Gerald 
Nemec/HOU/ECT@ECT
		 cc: Karen E Jones/HOU/ECT@ECT, Andrew Kelemen/HOU/ECT@ECT
		 Subject: Pastoria PSA

Below is the covenant we have in the PSA regarding release of the gas credit 
support.  When will a shipper be required to put up the credit support?  
Would anticipate we would have trouble obtaining a written release from Kern 
if Calpine agreed to provide the required support?  Would we receive a 
written release if Enron puts up a guarantee (which by definition covers the 
entire 15-year term) and Calpine puts up a three year evegreen LC?  Thanks.