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Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Jeff Dasovich X-To: Shelley Corman, Susan Scott, Jeffery Fawcett, skean@enron.com, Richard Shapiro, James D Steffes, Chris H Foster, Christopher F Calger, Mary Hain, Joe Hartsoe, Sarah Novosel, Margaret Carson, mpalmer@enron.com, Karen Denne, Linda Robertson, Cynthia Sandherr X-cc: X-bcc: X-Folder: \Jeff_Dasovich_June2001\Notes Folders\Sent X-Origin: DASOVICH-J X-FileName: jdasovic.nsf ----- Forwarded by Jeff Dasovich/NA/Enron on 12/19/2000 12:21 PM ----- Joseph Alamo 12/19/2000 12:05 PM To: Miyung Buster/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT cc: Susan J Mara/NA/Enron, Sandra McCubbin/NA/Enron, Jeff Dasovich/NA/Enron, Mona L Petrochko/NA/Enron, Roger Yang/SFO/EES@EES, Paul Kaufman/PDX/ECT@ECT, Lysa Akin/PDX/ECT@ECT Subject: Orange Co. Register, Tues 12/19: "Suits allege utilities conspired on prices" Suits allege utilities conspired on prices ENERGY: Southern California Gas, El Paso Natural Gas, SDG&E are targeted. December 19, 2000 By KATE BERRY The Orange County Register Two lawsuits filed in Los Angeles on Monday allege that Southern California Gas and San Diego Gas & Electric conspired to manipulate the natural gas market in Southern California, creating an artificial shortage that caused electricity prices to skyrocket this year. The two lawsuits, both seeking class action status, were filed in Los Angeles Superior Court and seek billions in damages. The lawsuits allege that executives of SoCal Gas, SDG&E and El Paso Natural Gas Corp., of Houston, met in 1996 and conspired to dominate the natural gas market in Southern California by illegally agreeing not to compete against each other. El Paso, which owns the largest natural gas pipeline serving California, allegedly nixed two new pipeline projects that were planned by Tenneco Inc., a company it acquired in 1996, in exchange for SoCal Gas refraining from competing on a pipeline project in Mexico, the lawsuits claim. "The nature of this conspiracy is not your classic price- fixing case,'' said Carole Handler, an attorney with O'Donnell & Schaeffer in Los Angeles, one of five law firms involved in the two lawsuits. "This was an agreement to give each of the participants an economic advantage in their own marketplace so they would not have to face the rigors of competition. It preserved Sempra's dominance in the market.'' SoCal Gas, the nation's largest gas distributor with 18 million customers, and SDG&E, with 2.2 million electricity customers in San Diego and south Orange County, were both acquired by Sempra Energy, of San Diego, in 1996. The lawsuits also name three units of El Paso Natural Gas: El Paso Tennessee Pipeline Co., El Paso Merchant Energy, and El Paso Merchant Energy-Gas L.P. SoCal Gas and SDG&E would not comment on the lawsuits, saying they had not been served with the complaints. Andrew Berg, owner of Wave Length Hair Productions in San Diego and a plaintiff representing retail electricity customers, said he contacted a lawyer after his electricity bill doubled in June. Since then, the state Legislature temporarily capped electricity prices for SDG&E customers. Natural gas is one of the core commodities used to produce electricity. The spot price of natural gas on the Southern California border Monday was $19.82 per million British thermal units, compared with $54.99 per million Btu a week ago. That's up from about $3 per million Btu last December. Gov. Gray Davis on Friday asked California Attorney General Bill Lockyer to launch an investigation into higher natural gas prices in California.
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