Funny...This did not get mentioned in our meeting with Dave.
---------------------- Forwarded by Jeffrey C Gossett/HOU/ECT on 03/12/2001
05:19 PM ---------------------------
From: Zhiyong Wei/ENRON@enronXgate on 03/12/2001 05:10 PM
To: Jeffrey C Gossett/HOU/ECT@ECT
cc: Russ Severson/HOU/ECT@ECT
Subject: Single deal entry

Jeff,

I just found out that the development of phase1 single deal entry project
didn't start as scheduled due to resource constraints. Therefore, the
development won't be done until mid of April. Sorry for the delay. I will
make sure to deliver it to you for testing by the middle of April. After
consulting Russ and Sitara-TDS team, the phase1 single deal entry will allow
users to enter simple types of physical deals at deal creation time. It does
not provide any editing functionality. In other words, once the deals are
saved to the system, any changes need to be done through both TAGG and
Sitara. Please see below for a short list of complex deals that are not going
to be captured in phase1. Russ helped me put the list together.


Deal Types not Captured in the Phase1-Single-Deal-Capture

1. Deals with multiple locations each of which has different cost of gas
because TAGG does not capture location information. For example, a
10-location deal will result in 1 Sitara deal with 10 CPR tickets and 10
TAGG legs. Each Tagg leg capturing the risk between contract price and mid
for that location.
2. Structured deals which have different volume for different months and
whose different risk components will be managed by different desks.
3. Tiered pricing structured deals that require one Sitara ticket and more
than one TAGG ticket. For example, 15,000 deal volume in broken down to 5,000
at fixed price, 5,000 at NYMEX - 0.10 and 5,000 at the index.
4. Physical options because TDS deal capture does not handle physical
options.
5. Trigger deals that allow setting prices before index settles. Basic
trigger deal can be captured. Entry problem relates if price trigger is
managed in a different book, or if different volume is triggered or
untriggered, than the original deal volume.
6. Physical index deals with the index that is different from the mid for the
location. Such deals need to be broken down into an index, a long basis and a
short basis in TAGG.
7. Percentage index deals that require two legs in TAGG. One leg is index
flat and the other is fixed price deal with zero fixed price and zero basis
and reduced quantity. For example, a 90% index deal with a quantity of 5000
can be broken down into one leg of index flat and the other leg of zero
fixed-price and zero basis and a quantity of 5000*0.1 = 500.
8. Floating basis deals. Deals can be entered with a price and physical
premium component where the basis will default to the actual basis settle.
These deals are sometimes entered as trigger deals with a floating basis.
The deal looks like a straight index deal, however the price can be triggered
and the basis will default to actual.



I would appreciate your comments.

Zhiyong