Once considered the most complex solution, we are now driven by the desire for immediate solutions. We in Enron firmly believe that we need action. We cannot convince our customers to take shorter terms and sacrifice price if we cannot even provide them with material offers on which they can insist. Enron has therefore decided to write down our receivables for well over $100m. We must reduce our risk. In this context, Enron Nordic Energy has today decided to sell forth-coming volumes in the physical market. For those of you who are new to the business and may feel that the non-delivery risk has been reduced by booking out and offering out our energy in the secondary market, we should like to remind you that Enron's gain on energy trading is primarily related to the company that can offer the lowest price. We reduce our risk and we increase our competitive advantage when we can perform a trade and book out. I am convinced that there are few who can do that. Our solution is immediately effective. We will be writing down receivables as agreed with our customers, and we will increase our sale volumes. For the non-delivery risk to be removed, the industry must be able to offer guarantees of trade. We work with our customers to minimise risk and we have for many years used various derivatives to lock in the trade. This has allowed Enron to collect from our customers and avoid booking out with the counter-party. By selling out in the market and buying back later in the day, we can be sure that we have sold back at least some volume to be delivered against the trade. It therefore minimises our risk in a situation in which the power may be redirected, as Enron have been able to do from time to time. The fact that the market is volatile in itself will have an impact on our effort to collect the money due. This does not, however, change the principle that we should minimise our risk in the market by reducing the exposure to risk. In the end, we have taken a difficult but honest decision, but I would like to stress that this is something we had to do. We have always been in a race against the clock in order to maximise our sales, but our sales volume increase in itself has put more pressure on the market and brought the price down. In reality, our efforts to find other solutions have been exhausted, and we are running out of time to find options which will work in the market. - Enron Nordic Energy In the short term, Enron must sell volumes in the physical market. We have decided to sell forth-coming volumes in the physical market. The fact that the market is volatile in itself will have an impact on our effort to collect the money due. This does not, however, change the principle that we should minimise our risk in the market by reducing the exposure to risk. In the end, we have taken a difficult but honest decision, but I would like to stress that this is something we had to do. We have always been in a race against the clock in order to maximise our sales, but our sales volume increase in itself has put more pressure on the market and brought the price down. In reality, our efforts to find other solutions have been exhausted, and we are running out of time to find options which will work in the market. - Enron Nordic Energy I believe that our immediate actions in the market will improve the climate. That is the reason why we have decided to act now. Enron remains the most experienced energy trader on the market and I am sure that our actions are what our customers expect from us. The Nordic market is particularly challenging. It has never been a problem for us to meet the financial requirements of the market, but as the difference between physical and financial market price has increased, we have concluded that it is necessary for Enron Nordic Energy to be active on the physical market. - Anders Ueberroth Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. India Dabhol Pwr Plant Sanctioned 05/22/2001 Dow Jones Energy Service (Copyright (c) 2001, Dow Jones & Company, Inc.) NEW DELHI -(Dow Jones)- The India's Maharashtra state government Wednesday issued a statement saying it has sanctioned its plan to set up the third phase of the 2,184-megawatt power project in the state. Dabhol Power, Enron Corp.'s (ENE) Indian unit, has initiated the third phase of the project which would be a 2,400 MW, $3 billion power project. Dabhol Power is a unit of Dabhol Power Company. Enron holds a controlling 65% stake in Dabhol Power. Sanjay Jog Maharashtra State's Energy Minister, Sanjay Jog, said in a press statement that the decision has been taken after the power purchase agreement with the second phase of the Dabhol Power Project was terminated by the power company's sole buyer, the Maharashtra State Electricity Board. "This phase will be implemented within the existing non-payment of power dues situation and under the supervision of the Maharashtra State Electricity Board," the release quoted him as saying. In May 1995, Enron's Indian unit, DPC, and India's largest utility, the Maharashtra State Electricity Board, or MSEB, started negotiations for the second phase of the Dabhol Power Project. The plant comprises two phases. Phase one began operations in May 1999. Dabhol Power owns 95% of the first phase and 85% of the second phase of the project. In December 1995, DPC had initiated arbitration proceedings against the MSEB. (Dabhol Power, ENE, C4) ??????? For more information and to contact AFX: www.afxnews.com and www.afxpress.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. INDIA: New Delhi aims to help Enron patch up with utility. 05/22/2001 Reuters English News Service (C) Reuters Limited 2001. NEW DELHI, May 22 (Reuters) - The Indian federal government is likely to help patch up multi-billion dollar energy firm Enron Corp's Dabhol Power Co with Maharashtra state's electricity board, which on Wednesday terminated a power supply agreement. The board, which is in default of payments, acted after DPC said the contract was being terminated following non-payment by the state electricity body. "We are in favour of finding a solution and a patch up," a federal government official told Reuters. "The centre wants to act as a mediator and this is the situation where they should interfere," he added, referring to the centre's willingness to intercede as the power purchase agreement was negotiated in the early nineties and signed by a state government. The state board had served DPC with a preliminary termination notice, which gives six months to the company and the federal government to settle the dispute. In May 1999, the Maharashtra electricity board failed to pay overdue bills and the DPC pulled the plug on December 29, 2000 - finally prompting the board to make good the December 2000 bill last week. The move to end a row over a nearly $3-billion project which has become the largest ever foreign direct investment in India has won DPC the support of U.S. lawmakers in a move aimed at signalling to other global investors that Washington could not have been oblivious to the power project. A company spokeswoman said the firm would respond once it assesses the effect of the board's move. DPC, which holds the controversial power purchase agreement and the asset transfer agreement with the state electricity board, has also terminated those agreements. DPC is the first major power project to come up in India after the country opened up its power sector to private and foreign investment in the early nineties. Many other foreign and Indian firms rushed in to set up projects in an attempt to secure a piece of the power sector, seen as a potentially lucrative business. However, execution risks relating to a host of issues from environmental and forestry clearances to availability of coal have resulted in most of the projects not making it to completion. GROWING DISSENT OVER DABHOL There has been growing dissent against Enron among investors, which have accused DPC of charging uneconomical tariffs. Last November, the Maharashtra and central governments had given some guarantees to the DPC and the project to help Enron overcome its funding dilemma. The