Subject: Update ofKern River Info,PG&E testimony
From: [email-masked]
To: [email-masked]
Cc: [email-masked]
Date: Thu, 4 May 2000 03:03:00 -0700 (PDT)

Jeff,

Here is what I have right now. Kern has promised to send on a
expedited basis, information concerning their open season and
recent Ferc settlement.

1) Kern is holding an open season for request to California &
Neveda on an indefinite basis. They are suggesting "no limit"
to the potential size of the project (assuming customer demand)
but acknowledged that 250-300 mmcfd probably is optimum.

2)The firm rate effective 1/1/00 is daily reservation : $0.5892/dth
the volumetric rate is $0.0667/dth plus fuel

3) New shippers willing to make a 10 to 15 year commitment now
can get a rate of $0.42/dth

4) Existing shippers (whom Kern will refer IGS to) that have
indicated a desire to relinguish their capacity can also get the
TDR rate of $0.42 for an 10 year extension of contract. A third
party could negotiate with these shippers (for an additional
discount) and obtain adjusted TDR Kern capacity.

5) Kern anticipates refinancing their pipeline by March 2001; which
will assure TDR rate levels in the future. Kern rep thought
that no later than 2007 everyone would enjoy $.40 rates.

PG&E TESTIMONY

As a follow-up to my early call, a quick note about PG&E. First PG&E
will be filling testimony on May 5th. The topic I am told is Wheeler
Ridge They want a change to the receipt point matrix exactly like
I fowarded last week. They are convinced if a change isn't made to the
matrix the probable market outcome for PG&E,KRS is only 70 mmcfd.
Starting with 520 less 300 of typical Kern/Socal volumes, 50 of
SDG&E volumes and 100 of already done KRS commitments.

Call when you can, I will be glad to review the whole landscape.