Re: Aquila Risk/Energy Marketing Profile Changes

---------------------- Forwarded by Mark Taylor/HOU/ECT on 12/29/99 10:22 AM
---------------------------

From: Bob Shults 12/29/99 08:54 AM

To: Louise Kitchen, David Forster
cc: Debbie R Brackett/HOU/ECT@ECT, Mark Taylor/HOU/ECT@ECT
Subject: Re: Aquila Risk/Energy Marketing Profile Changes

We have not restricted access at this point given the request came from
Aquila contracts and credit. Aquila can restrict themselves via the
administration function should the elect to. This will mean that Aquila's
contract and credit people will need to talk to their commercial people.
Debbie Brackett requested collateral on all financial trades done by Aquila
Energy Marketing. This prompted Aquilla's credit to say they would stop
trading as such. Aquilla's traders feel we should provide an alternative
solution. The contractual solution we have proposed will resolve the
contractual issues however it does not fix the intraday credit issue. EOL
will not apply the trades to the correct headroom number when doing the
credit look prior to the completion of a transaction.

We need to evaluate if there is a systematic solution which can afford to
give the customer what they want and cover all the credit bases. The
solution would have the system compare the ID and the product and then
allocates the trade to the appropriate company for both contractual and
headroom purposes.

For now we will continue to assign trades between companies and credit will
continue to request collateral as appropriate.

Please let me know how you would like to proceed.

David Forster
12/29/99 03:24 AM
To: Bob Shults/HOU/ECT@ECT
cc: Louise Kitchen/LON/ECT@ECT
Subject: Aquila Risk/Energy Marketing Profile Changes

Bob,

Is this the latest on Aquila?

Is this still an issue for KN?

I note that the Aquila contacts requesting a profile change are Contracts and
Credit - have we spoken to the traders? I'm not comfortable that limiting the
profiles provides the best solution for the customer - bearing in mind that
our primary customer is the trader, who will be the one actively using EOL.

I'm also not real happy about restricting a customer's profile - although I
realise that we have done so for Power (license issue) and we do so for
credit purposes. More importantly, though, we are talking about restricting a
customer's profile to make it harder for an actively trading counterparty
(valid or not) to be doing trades.

To my way of thinking, we need a solution which encourages the traders to
trade without annoying other elements in Aquila to the point where they pull
access to EnronOnline - which brings me back to the assignment solution,
hairy though it may be.

Thoughts?

Dave
---------------------- Forwarded by David Forster/LON/ECT on 12/29/99 09:17
AM ---------------------------

Brant Reves
12/28/99 04:08 PM
To: Bob Shults/HOU/ECT@ECT, Frank L Davis/HOU/ECT@ECT
cc: Mark Taylor/HOU/ECT@ECT, Tana Jones/HOU/ECT@ECT, Molly
Harris/HOU/ECT@ECT, Tom Moran/HOU/ECT@ECT, Debbie R Brackett/HOU/ECT@ECT,
Louise Kitchen/LON/ECT@ECT, David Forster/LON/ECT@ECT

Subject: Aquila Risk/Energy Marketing Profile Changes

hello all,

After spending much time on the phone with Aquila, it was requested by them
(Scott Eckermann, Contracts and Terry Batt, Credit) that we take active
measures internally to limit the product profile of both Aquila Risk
Management and Aquila Energy Marketing to their respective trading
competencies. Aquila Risk trades financially under an existing Master
Agreement and Aquila Energy Marketing trades physically under existing Master
Physical Agreements. I informed Aquila that we would make changes to their
profiles after the market closes today. If we should not take such action at
this time, please call me at 713-853-9897.

thanks
brant