Enron procures a new $1 billion credit facility

By the OGJ Online Staff

HOUSTON, Nov. 1, 2001 — Embattled Enron Corp. Thursday said it arranged for an additional $1 billion credit line from Salomon Smith Barney Inc. and JP Morgan Chase & Co.

The credit line is secured by Northern Natural Gas Co. and Transwestern Pipeline Co., Enron's pipeline assets.

"With more than $1 billion in cash currently on our balance sheet, this additional credit capacity will further solidify Enron's standing in the wholesale energy markets," said CEO Kenneth Lay in a statement.

The credit line commitments are subject to terms and conditions, including final due diligence.

Chief financial officer Jeffrey McMahon called the credit line another step in the company's effort to enhance market and investor confidence. McMahon was appointed after the ouster of Andrew Fastow, 2 weeks ago.

Fastow was removed by the board because of personal involvement in the off-balance sheet transactions that are at the center of a Securities and Exchange Commission investigation. The day before his removal, however, Lay personally gave Fastow a vote of confidence publicly in a conference call.

Enron is under extreme pressure because of losses in the third quarter and tightening credit from downgrades by credit ratings agencies. Shares of the company, which still maintains an investment grade credit rating, have declined nearly 60% in 2 weeks fueled by unanswered questions about a number of complicated off-balance sheet transactions. News the SEC inquiry had been upgraded to a formal investigation Wednesday short circuited a budding recovery in the stock price.

The stock rose 20% Wednesday in trading on the New York Stock Exchange, closing at $13.90. But Enron shares slipped again Thursday to $12.65/share in mid-morning trading as investors mulled news of the SEC investigation and another downgrade by financial analysts, despite the new credit facility.

Sponsored by FLSmidth

Related Articles

B&W Vølund to build waste-to-energy power plant in Scotland

In a consortium with Interserve, Babcock & Wilcox Co.’s (B&W, NYSE:BWC) subsidiary, Babcock & Wilcox Vølund A/S (B&W Vølund), will engineer, procure and construct (EPC) a waste-to-energy (WTE) power plant for Viridor UK. The contract is worth approximately $230 million.

PSC approves solar power project

The Public Service Commission has approved solar power project planned by Kentucky Utilities and Louisville Gas and Electric in Mercer County.

Follow Power Engineering on Twitter

Latest News

 Electric utility Dominion flexes political muscles in Virginia

Electric utility Dominion flexes political muscles in Virginia

Virginia's 2015 legislative session was a good one for energy giant Dominion Resources Inc. (...
Callaway Energy Center's Replacement Reactor Vessel Closure Head Project

[Image Gallery] Callaway Energy Center Nuclear Power Upgrade Project

 DOE to help tribes advance onsite, renewable energy projects

DOE to help tribes advance onsite, renewable energy projects

DOE announced the third round of START Renewable Energy Project Development Assistance, which...
Report: 2014 was the best year for utility-scale solar power

Report: 2014 was the best year for utility-scale solar power

With more than 3.7 GW installed, 2014 was the best year yet for utility-scale solar power ins...
CHP: Energy Independence Offers a Competitive Edge

[Image Gallery]

Best Boiler Cleaning Practices

[Image Gallery]

 FirstEnergy Nuclear Operating Co. elects new president, CNO

FirstEnergy Nuclear Operating Co. elects new president, CNO

FirstEnergy Nuclear Operating Co. (FENOC), a subsidiary of FirstEnergy Corp. (NYSE: FE),...
 Enbridge’s Texas wind project reaches commercial operation

Enbridge’s Texas wind project reaches commercial operation

Enbridge’s 110-MW Keechi Wind Project has reached commercial operations in Jack County, Texas.

Power Engineering Current Issue

03/01/2014
Volume 118, Issue 3
1403PE-cover

Products Showcase

Dynamic Fluoride Ion cleaning DFIC of industrial natural gas turbines Hi-Tech Furnace Systems

Dynamic Fluoride Ion Cleaning of IGT Parts

The Dynamic Fluoride Ion Cleaning (DFIC) Process from Hi-Tech Furnace Systems is able to clean deep, narrow cracks of oxides by cycling between negative, atmospheric, and positive pressure.

Archived Articles

2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013

Power Industry Wire News

Western Gas Announces Acquisition and 2015 Outlook

Western Gas Announces Acquisition and 2015 Outlook

Thinnest, Rugged Laptop With 15" Display

Thinnest, Rugged Laptop With 15" Display

BioCNG, LLC Announces Expansion of St. Landry Parish Solid Waste District BioCNG(TM) System to Include Mother-Daughter Fuel Station

BioCNG, LLC Announces Expansion of St. Landry Parish Solid Waste District BioCNG(TM) Sy...

Letter From CGE Energy President Bryan Zaplitny

Letter From CGE Energy President Bryan Zaplitny

UGE International and OTEPI Renewables Selected to Supply Solar Energy Systems for Retail Chain's Portfolio of Facilities

UGE International and OTEPI Renewables Selected to Supply Solar Energy Systems for Reta...

Power Engineering

Article Archives for Power Engineering Magazine

Continuing Education

Professional Development Hours

To access a course listing associated to a specific topic listed below, click on the topic of choice from the list below.

Latest Energy Jobs

View more Job Listings >>