Utility officials off to Texas for talks with Enron

Utility officials are expected to travel to Houston, Texas within the next few weeks to brief lawyers they recently hired before the start of formal negotiations with Enron on Saipan’s 60-megawatt power project.

Laura I. Manglona, vice chair of the Commonwealth Utilities Corp. board and head of the operations committee, said there is no definite time frame on the process, but disclosed it is being handled “quickly and well.”

Lawyers from Fulbright & Jaworski have been retained by the government-owned utility corporation to assist the board in reaching an agreement with Enron on the controversial power project.

During their meeting in Houston, “they will hold days and days of meetings with us, preparing our most desired product, and then they will go to work, negotiating with Enron,” Ms. Manglona told the board yesterday.

CUC has laid down various preparations for the forthcoming negotiation with the Houston-based conglomerate, including transparency in order to inform government officials and the public on the process.

According to Ms. Manglona, they want to keep the people updated on the status of the project without giving the strategy when the corporation and its lawyers deal with Enron executives.

“We are about to enter a long-term marriage, like two people want to enter a marriage,” she explained. “You want the right partner — based on trust, communications, a good relationship, and a strong prenuptial agreement.”

Enron won the “conditional award” of the estimated $120 million contract in May after more than three years of procurement marked by disputes and protests from competing bidders.

Both parties, however, will still need to hammer out a final deal before actual construction can begin on such aspects as costs and commercial terms as well as permitting and compliance with Public Law 12-1 that set out the 60-MW plant.

Last week, CUC threw out three protests lodged against its choice of Enron, upholding the constitutionality of that law and the recommendations made by its power consultants from Burns & McDonnell.

The consortium of Tomen, Alsons, Singapore Power and Tan Holdings, and the Saipan Power Partners, who were closed competitors to Enron, opposed the award, as did Telesource who sought re-bidding after the project was downsized from 80-MW.

At yesterday’s board meeting, members expressed satisfaction that the project is moving along despite the protests, the latest of which alleged close links between Enron and Fulbright & Jaworski due to previous business relationship.

Ms. Manglona brushed aside the allegations, saying the board sought legal advice and studied the lawyers’ proposal before hiring them.

“There’s nothing to worry,” she said in an interview after the three-hour meeting. “It’s going to be on CUC’s terms once our lawyers sit down in the negotiating table with Enron.”

CUC has also renewed services of Burns & McDonnell, which is based in Kansas City, to draw up specifications of the 60-MW plant which officials hope to begin construction before the end of the year.