FW: Northern v. ONEOK/RE: Oneok Bushton Measurement ,
 FYI - Please read the following memos.  Britt, Rick Craig, Ken Cessac and I=
 are meeting on Monday at 2:00 to discuss this issue in detail.
=20
Rick

-----Original Message-----=20
From: Dornan, Dari=20
Sent: Fri 9/7/2001 4:17 PM=20
To: Fossum, Drew; Craig, Rick; Davis, Britt; Cessac, Kenneth; Dietz, Rick=
=20
Cc: Darveaux, Mary=20
Subject: FW: Northern v. ONEOK/RE: Oneok Bushton Measurement




Could you please keep me and Mary Darveaux in the loop on all this.  Thanks=
, Dari=20

 -----Original Message-----=20
From:   Davis, Britt =20
Sent:   Friday, September 07, 2001 2:53 PM=20
To:     Craig, Rick; Fossum, Drew=20
Cc:     'gharvey@gibbs-bruns.com'; Dietz, Rick; Ringblom, Kathy; Cessac, Ke=
nneth; Zikes, Becky; Carrier, Lee=20
Subject:        Northern v. ONEOK/RE: Oneok Bushton Measurement=20

        Rick,=20

        I think the memo is excellent.  In order to preserve the legal priv=
ileges, I would reference the still-pending Northern v. ONEOK matter in the=
 "Subject" and restrict the distribution to only those who need to know.

        My gut is that Sommer is out of the loop b/c ONEOK lost confidence =
in him (and Drew, you were right again).  Given that development and that y=
ou are being sent some proposed revised language, I am going to cancel our =
meeting for Monday with you, me, Ken Cessac and Rick. It makes little sense=
 to me for us to get together until all of us have had a chance to review a=
nd digest the language.

        Many thanks.=20

        Britt=20

       =20

 -----Original Message-----=20
From:   Craig, Rick =20
Sent:   Friday, September 07, 2001 12:24 PM=20
To:     Fossum, Drew; Davis, Britt=20
Subject:        Oneok Bushton Measurement=20

Britt and Drew, here's a memo I've generated based on my conversations with=
 Oneok this morning.  I just thought I'd get you guys' opinion on it before=
 I expand the distribution to include marketing, operations, reg affairs, e=
tc.  Is this way more detail than anyone will want?  Just wanted your guida=
nce since this is my maiden voyage onto this turf.  Thanks.   =20


After trying most of the week to reach John Sommer at Oneok, I received two=
 calls this morning, one from Kevin Willt (Bushton Plant) and the other fro=
m Steve Winston regarding the Bushton measurment issues.  Kevin just wanted=
 to let me know that he would be their measurement contact for day to day o=
perations issues at the Bushton plant and wanted the phone number for Kenne=
th Cessac.  He said he would be getting with Kenneth about the April/May di=
fferences between metered volumes and PTR and would be working with Kenneth=
 going foward on the day to day measurement issues. =20

Steve Winston wanted to discuss a number of issues.  Here's how that discus=
sion went.  This may be far more detail than anyone wants but since I'm jus=
t jumping into this I want to make sure everyone knows what's taking place.=
  If you want far less detail going foward, please let me know.  =20

Steve asked what our plan was.  I told him that we were waiting for their t=
echnical expert to get with Ken Cessac to look at the April/May differences=
 (this was based on Ken's call to John Sommer last week) and that I had bee=
n trying to get with John Sommer to set up a meeting as a follow-up to his =
discussions with Phil to talk about their concerns and need for further cla=
rification to the Measurement Agreement.  Steve informed me that John Somme=
r would no longer be in the picture as a result of recent org changes and t=
hat we should work with he and Terry Spencer.=20

He stated that Blaine Bender, their Kansas Operstions Manager, and Kevin Wi=
llt, their Bushton plant measurement person are supposed to be getting with=
 Ken Cessac to look at the April/May differences.  I told him that I had ju=
st talked to Kevin.  They have hired Steve Stark as their technical expert/=
consultant to work on this.  He stated that the arbitration hearing had "gi=
ven us a clean slate" and that the metered volume/PTR comparisons in June, =
July and August looked pretty good with both sides of the plant running but=
 that April and May were a still a concern to them.  They're desire is to l=
ook into it and "let the science prevail" on these months.  I told him that=
 our position, based on the arbitration decision, was pretty clear, that be=
ing that our metered volumes prevail, a comparison is really indifferent.  =
He did not respond all that well to this statement and said that we both ha=
ve to work together on this issue going forward.  I told him that we would =
certainly work with them to look at the April and May differences and that =
if that look/see showed anything we would certainly consider it but reempha=
sized that the measurment agreement is the basis for our business decisions=
. =20

He then wanted to know what needed to be done from the standpoint of the me=
asurement agreement.  I told him that we were open to listening to their co=
ncerns and if we needed to get together for a meeting, that we could get on=
e set up.  I asked if he could share some of his thoughts on what they were=
 thinking.  Here's a bullet list of some of the things he brought up. =20

They want to build a relationship with us where both sides openly share the=
ir measurement data and information as is relates to metered volumes and PT=
R. =20

They have no long term confidence in the ultrasonic measurment without a co=
mparison to PTR.  He also brought up the issue of two phase flow as tempera=
tures begin to cool this fall and condensate starts come up the pipe.

They propose that the agreement be redone in such a way that it is more "se=
lf correcting" and that compares the metered volumes to PTR.  And as long a=
s this comparison falls within certain tolerances, then there would be no a=
djustments.  While he didn't want to commit to a tolerance, he did give a "=
Steve Winston opinion" of around 1%.  He described the process as a "self c=
orrecting" process. Not real clear what that means. =20

He also stated that they would want to define a level of exceedance that wo=
uld require a joint investigation of the problem and defined resolution pro=
cess. =20

I asked if as a starting point, he would generate a list of their proposed =
change provisions and send that to me.  He said he was already working on i=
t, he called it "Bushton PTR Measurement Settlement" and would get a bullet=
 list to me in the next couple of days that we could start looking at.  We =
agreed that we would start from here and then see where it takes us.
shelley.corman@enron.com