Subject: Penalty Summary - VNG - Columbia Gas Transmission (TCO) - November 2000
From: [email-masked]
To: [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked]
Cc: [email-masked]
Date: Mon, 11 Dec 2000 05:54:00 -0800 (PST)

High Level Penalty Summary

Date(s) of Flow

 November 18 - 21, 2000

Contract Involved:

 38088  ENA delivered 33,250 to Hopewell on this contract for dates below.  
VNG needed volume below to balance at gate, attempted to pull    and contract 
was overrun.

  18 VNG took 29,782 from storage, result of both ENA and VNG was 14,002 
overrun.

  19 VNG took 44,476 from storage, result of both ENA and VNG was 28,696 
overrun.

  20 VNG took 37,643 from storage, result of both ENA and VNG was 21,863 
overrun.

  21 VNG took 56,881 from storage, result of both ENA and VNG was 18,876 
overrun
   ______

 Total Overrun: 83,437 @ $0.1992 =  $16,620.65

 60536  ENA delivered 11,451 back into the VNG storage as payback when VNG 
pulled all 14,625 and overran the contract.  

  21 14,306 overrun
   ______

 Total Overrun: 14,306 @ $0.1992 = $2,849.76

 TFE  Total Firm Entitlement Penalty

  18-21 97,743 @ $5.6684 = $554,050.00

   Total Overrun on both contracts and penalty due to market area 
restrictions when overrun occurred.

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1) Enron NA was never notified by TCO of any penalty, overrun on VNG contract 
or pipeline OFO situation during the November 18-21 time period.

2) Denise Dotson was notified by VNG gas control on the morning of November 
20th about the overrun situation above.  The VNG gas control experienced  the 
problem but did not notify Enron or AGL until Monday morning.

3) Enron immediately placed ranking system in Navigator to make VNG first 
priority.  This was completed Monday afternoon November 20th.

4) On Tuesday morning 11/21, Denise Dotson once again called Enron stating 
that the previous night VNG attempted to pull maximum  volumes from   storage 
contracts only to overrun contract due to ENA nominations to other delivery 
points.  Joann Collins called her Columbia team and was told that the  
ranking was not applicable after the last confirmation cycle on any gas day 
with no-notice contracts.  Ranking has zero effect with the late night   
schedulers.

5) Enron dropped the Hopewell nomination from the VNG contract(s) effective 
11/22.

---------------------- Forwarded by Steve Gillespie/Corp/Enron on 12/11/2000 
01:05 PM ---------------------------

"Denise Dotson" <[email-masked]> on 12/08/2000 04:18:42 PM
To: <[email-masked]>, <[email-masked]>
cc: <[email-masked]>, <[email-masked]> 

Subject: Columbia Gas Transmission (TCO) penalties - November 2000

** High Priority **

I received a call this afternoon from the VNG - TCO Account Manager.  VNG 
incurred pipeline overrun charges from  Nov 17th - 21st.  TCO stated ENA used 
VNG capacity to deliver to other markets {Hopewell Power Plant}.  TCO 
notified Enron and VNG of the allocation problem during the month of 
November, 2000.  Although TCO assured Enron that the predetermined allocation 
methodology would be corrected to allow VNG rights to pull under the contract 
first, however, based on the conversation with TCO, corrections were not 
made.  Therefore, VNG incurred overrun charges under the VNG contract @ 
$10.00/dth totaling $560,000+.

Please notify pipeline to reconcile and provide AGLES with pipeline invoices 
for November, 2000.  ENA is responsible for all penalties associated with 
this transaction.