Message-ID: <9621007.1075854946941.JavaMail.evans@thyme>
Date: Mon, 27 Aug 2001 12:37:46 -0700 (PDT)
From: e..haedicke@enron.com
To: peter.keohane@enron.com
Subject: RE: Canadian Retail and Wholeale Issues
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X-From: Haedicke, Mark E. </O=ENRON/OU=NA/CN=RECIPIENTS/CN=MHAEDIC>
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Peter:

This is a tough battle.  It may be worse because your clients are either th=
e same ones or geographically very close.  I would try to address it by poi=
nting out the limitations of the simplier forms and as a fallback emphasize=
 the increased risk (legal and otherwise) when using the shorter forms.

Mark

 -----Original Message-----
From: =09Keohane, Peter =20
Sent:=09Monday, August 20, 2001 12:22 PM
To:=09Haedicke, Mark E.; Elbertson, Janette
Subject:=09Canadian Retail and Wholeale Issues

Mark, on the "retail" front, I did not want to get into all of the detail a=
round what is happening in Canadian Retail in the Legal Committee call (did=
 not realize Vicki et al. are now joining our calls), but I am meeting with=
 Vicki later today (4:00 pm central) to review Canadian Retail.  Do you wan=
t to join?  The major "retail" issue is the commercial pace to transact out=
stripping the pace at which we can catch up legally to certain aspects of t=
he business - not so much for transacting between us and the counterparties=
 - but more in terms of understanding and mitigating "distribution" risks w=
ith and behind the LDC under applicable tariffs, T&Cs, policies and procedu=
res.

On the related but "wholesale" front, I would also like to talk to you for =
5-10 mins. to get your thoughts on transacting within the cross-over betwee=
n "retail" and "wholesale".  More precisely, wholesale traders/originators =
have more and more pressure to transact at or behind the LDC rather than ar=
ound a wholesale "hub" - particularly when it comes to power or Eastern gas=
.  This introduces "retail" type issues into the wholesale transacting proc=
ess, with implications for our transacting/forms procedures.  Since the dis=
tinction here between retail and wholesale has developed around commercial =
"turf", and not the nature of the counterparty, the wholesale traders/origi=
nators are looking more and more at transactions that are "retail" in natur=
e.  The result is the wholesale traders/originators pushing to use the "sim=
pler" or less rigorous contracting procedures and forms developed for our "=
retail" market for these "wholesale/retail" deals, which I am not sure is a=
lways appropriate, but for which I am having difficulty drawing the line.  =
I have an idea, which is to create wholesale products under our Master Agre=
ements which address "retail" type issues.  The problem is where to draw th=
e line and the resistance to what is perceived by wholesale traders/origina=
tors as a more rigorous standard, as compared to both internal Enron Direct=
 "competitiors" and external competition.

Peter. =20

____________________________________
Peter C.M. Keohane
Vice President, Assistant General Counsel
and Secretary
Enron Canada Corp.
Phone:=09(403) 974-6923
Fax:=09(403) 974-6707
E-mail:=09peter.keohane@enron.com