1. Operations Directors Conference October 9, 2001
Transwestern Pipeline Company
Steve Harris
Vice President Commercial Group

2. Overview 2001 Results 2002 Plan Market Environment Upside/Downside
Projects

3. 2001 Third Current Estimate
As of 9/17/2001

4. 2001 Successes $14.7 MM above Plan as of 3rd Current Estimate
Subscribed 106,700/d of Red Rock Expansion Capacity (15.5% ROE)
All West & East mainline capacity, San Juan & Ignacio to Blanco capacity subscribed
New Deal Structures:
IT Pool to Pool at CA border (Reliant, Texaco)
Index to Index deals (Sempra & Richardson)
East to East sharing with alternate West (USGT & Astra)

5. 2001 Successes (continued)
Renewed Navajo R-O-W
Renewed Laguna R-O-W
Marketing capacity through Enron Online
Connected 26,000/d of new supply
New 200,000/d pipeline interconnect with Oneok
Dashboard & Pipeline Profile systems

6. Transwestern Pipeline Company Commercial Contribution
Commercial Group
2002 Operating Plan
Commercial Contribution
(Millions)

7. Capacity Subscription Level on Transwestern
(including Red Rock)

8. Expansions to California
Filed With the FERC WA
200,000 MMBtu/d
Southern Trails
PGT
Kern
EPNG
TWPL OR ID WY NV
1,010,000 MMBtu/d UT CO CA
120,000 MMBtu/d OK
150,000 MMBtu/d AZ NM
230,000 MMBtu/d TX

9. Expansions to California Filed With the FERC
Project
In-Service
Volume
TW Red Rock
June, 2002
150,000/d
EPNG
August, 2001
230,000/d
PGT (Phase I)
November, 2001
200,000/d
Southern Trails
July, 2002
120,000/d
Kern River
May, 2002
125,000/d
May, 2003
885,000/d
TOTAL
1,710,000/d

10. Additional Expansions Announced
Project
In-Service
Volume
TW Sun Devil
January, 2004
330,000/d
Sonoran (Phase I)
Summer, 2003
750,000/d
EPNG
320,000/d
PGT
November, 2003
400,000/d
CIG Ruby
December, 2003
TOTAL
2,550,000/d

11. NYMEX Prices
($/MMBtu)

12. Basin Prices, Border Prices & Transport Rates *
($/MMBtu)
$0.320
$0.074
* Transport Rates are net of fuel.

13. Unhedged Fuel 2001 Actual prices 107% of plan prices
Actual unhedged volumes 213% of plan volumes
2002
Volumes to be significantly impacted by Red Rock outages (180,000/d April-May)
I to I deals reduce volumes received in-kind

14. Fuel Prices 2001 vs. 2002 ($/MMBtu)
$3.96
$3.55

15. Potential Impacts 2002 Plan
Upside
Negotiated rate proceeding: $10MM
SoCal rate dispute: $2.2MM
Downside
Red Rock in-service delay: $1.124MM
Gas prices: $.4MM
(per $.10 variance)
Agave & Amoco options to reduce MAXDTQ: $1.3MM

16. Load Factor Upside/Downside (Million $)
Revenue
Difference
85%
$202
90%
$203
($1.8)
92%
$204
$0.7
95%
$205
$1.7

17. Projects Red Rock Expansion Sun Devil Trans Pecos Southern Trails
Caithness/Big Sandy
PG&E Potential Opportunities

18. Red Rock Expansion
Incremental 120,000/d delivered to California & East of California
Additional hp at Stations 1, 2, 3 & 4
1.210 Bcf/d total deliveries West
Supplies from East of Thoreau
In-service June, 2001
106,700/d subscribed, resulting in 15.5% ROE

19. Sun Devil Project $550 MM capital cost 450,000/d capacity to Phoenix
Nevada
Utah
Colorado
NNG
California
Kansas
New Mexico
Sun Devil
Oklahoma
TWPL
Phoenix
Arizona
Texas
$550 MM capital cost
450,000/d capacity to Phoenix
780,000/d Blanco to Thoreau on TW
330,000/d to CA border on TW

20. Sun Devil Open Season Results
Path
San Juan to Thoreau
Thoreau to CA Border
Thoreau to Phoenix
Total Bids Received
651,000/d
265,000/d
440,000/d

21. TransPecos Project TW/KM LOI executed TP/Pemex LOI tendered:
Nevada
Utah
Colorado
NNG
California
Kansas
New Mexico
Oklahoma
TWPL
Arizona
Texas
TW/KM LOI executed
TP/Pemex LOI tendered:
$.2950/MMBtu
Pemex counter-offer:
$.25/MMBtu
NGPL
TransPecos

22. Southern Trails Project
Nevada
Utah
Colorado
NNG
California
Kansas
Southern Trails
New Mexico
Oklahoma
Arizona
TWPL
RFP to purchase
West leg, due Oct 15th
In-service 7/2002
“East” San Juan to CA border:
87,500 MMBtu/d
“West” CA border to Long Beach:
-120,000 MMBtu/d
Texas

23. Caithness/Big Sandy Project
Nevada
Utah
Colorado
NNG
California
Kansas
New Mexico
Arizona
Oklahoma
TWPL
Big Sandy
Texas
Caithness will build 41 miles to TW
Interconnect cost to TW, $550 K
780 MW baseload generating plant
Phase I: 520 MW, 90,000/d, Q4 2003
Phase II: 260 MW, 40,000/d, Q3 2004

24. PG&E Potential Opportunities
Bi-directional capability at PG&E/Topock interconnect
20 mile lateral to serve generation plants in Bakersfield area, incremental 300,000/d load