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

Fuel Tech receives air pollution control contracts worth $3.6Mn

Fuel Tech Inc. has received multiple air pollution control (APC) contracts, worth approximately $3.6 million, from customers in China, Europe and the U.S.

Video: Duke Energy acquires Halifax Solar Project in North Carolina

Duke Energy Renewables (NYSE: DUK) has acquired a 20-MW solar project in Roanoke Rapids, North Carolina, from Geenex and ET Solar Energy Corp.

Follow Power Engineering on Twitter
Latest News

Westinghouse, European partners to supply nuclear fuel

Westinghouse Electric Co. and eight European consortium partners received 2 million euros ($2...

Appeals court backs MSHA on plan for mine serving Prairie State

The U.S. Court of Appeals for the District of Columbia Circuit has agreed with a branch of th...

Appalachian Power explains lack of more coal-to-gas conversions

The Appalachian Power Co. (APCo) unit of American Electric Power (NYSE:AEP) told the West Vir...

Court rules against limits on power plant mercury emissions

A divided Supreme Court on Monday ruled against federal regulators' attempts to limit power p...

SunEdison purchases wind power portfolio from TerraForm Power

SunEdison Inc. (NYSE: SUNE) and TerraForm Power Inc. (Nasdaq: TERP) closed on the acquisition...

European regulators clear Siemens' buyout of Dresser-Rand

European regulators have cleared Siemens' $7.6 billion acquisition of the U.S. oilfield equip...

Proposed Md. smog regulations get an airing at hearing

Environmentalists are raising a stink about Maryland's approach to air pollution.

Germany's oldest remaining nuclear plant shuts down

Germany's oldest remaining nuclear reactor has been shut down, part of a move initiated four ...

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

EnerCom, Inc. to Host 100+ E&P, Oilfield Service and MLP Companies at the Oil & Gas Confernce(R) 20; Conference Dates Are August 16-20, 2015

EnerCom, Inc. to Host 100+ E&P, Oilfield Service and MLP Companies at the Oil & Gas Con...

DEKRA Announces Porsche North America's Porsche 911 RSR Green Challenge Winner of TUDOR Championship Race in Watkins Glen, NY

DEKRA Announces Porsche North America's Porsche 911 RSR Green Challenge Winner of TUDOR...

CH2M-Led Team to Manage and Operate Canadian Nuclear Laboratories

CH2M-Led Team to Manage and Operate Canadian Nuclear Laboratories

ZBB Energy Announces Adjournment of Special Meeting

ZBB Energy Announces Adjournment of Special Meeting

DEKRA Certification to Present Webinar on Sustainability Management Systems

DEKRA Certification to Present Webinar on Sustainability Management Systems

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 >>