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Enron called 'uncooperative'; new probe launched

A senator examining the stunning collapse of Enron Corp accused the company on Thursday of not cooperating with his probe, while federal energy regulators launched yet another investigation into the once high-flying energy trader.

Sen Byron Dorgan, who heads the Senate Commerce subcommittee on consumer affairs, said Enron had not co-operated with the panel's inquiry into its downfall. Elsewhere, the Federal Energy Regulatory Commission launched a probe into allegations that Enron unfairly boosted wholesale power prices during California's power crisis last year.

Former Enron suitor Dynegy Inc took control of the Northern Natural Gas pipeline, giving it half the pipeline system Enron was counting on to help pay its creditors and survive a bankruptcy court reorganisation. Enron has sued Dynegy over the pipeline.

The Senate Finance Committee, one of at least nine congressional committees probing Enron's demise, asked three federal agencies that help corporations operate overseas for details of any assistance they may have given Enron.

The impact of Enron's descent into the largest bankruptcy in US history continued to spread. Microsoft Corp's Internet unit, MSN, said its plans to sell high-speed access to homes would be delayed by Enron's woes. Enron had been providing the backbone for MSN's expansion of its high-speed access and services.

Alliance Capital Management Holding LP, which was the largest shareholder in Enron, reported a 10 per cent drop in fourth-quarter profits. Power producer Calpine Corp, which with other power producers has faced increasing scrutiny from investors and creditors since Enron's December 2 bankruptcy filing, saw fourth-quarter earnings tumble 23 per cent.

Thousands of workers have lost their jobs since Enron filed for bankruptcy amid questionable accounting practices, failed investments and the impact of off-balance sheet activities. Many former and current employees saw the value of Enron shares held in retirement plans become virtually worthless.

ENRON 'UNCOOPERATIVE'

"The Enron Corporation is not co-operating with the committee's request for information," said Dorgan, a North Dakota Democrat and subcommittee chairman.

Enron lawyer Robert Bennett said Dorgan was "terribly misinformed." Bennett said, "We have been totally cooperating with the committee."

The Commerce Committee has asked Enron to provide it with information about partnerships the company used to move debt off its books and enhance profits. The partnerships were central to Enron's financial unraveling.

"To date, the corporation has provided no information to the committee about these partnerships," Dorgan said. "The corporation has provided some information, not enough and not the critical information we need, especially about off-the-books partnerships."

Dorgan told a news conference the committee expected to hear from former Enron chief executive Kenneth Lay at a hearing on Monday in what would be the executive's first public remarks about the Enron collapse. Lay, who built Enron into a corporate power, resigned under fire on January 23.

Dorgan said former Enron chief executive Jeffrey Skilling "has declined the committee's request to appear before it on February 4, but has agreed to testify before it at a later date."

Former Enron chief financial officer Andrew Fastow "has not responded to any of the committee's communications," Dorgan added. Both Skilling and Fastow had been invited to testify at Monday's hearing.

US ENERGY REGULATOR JOINS PROBE

FERC chairman Pat Wood said his staff began looking at allegations of price manipulation by Enron. He would not speculate on the scope of the probe.

The probe was demanded by California Governor Gray Davis and other West Coast Democrats who say Houston-based Enron manipulated wholesale prices to boost profits at the expense of California residents. The state's electricity crisis caused blackouts and forced California to spend billions of dollars to buy power when utilities could no longer afford to do so.

Enron, which had been the world's biggest energy trader, has denied any wrongdoing. It was among a dozen power generators that were major players in California's wholesale electricity market.

Wood, a Texas Republican, was appointed FERC chairman last summer by President George W Bush with the support of Enron. Democrats have raised questions about Bush's close ties to Enron, which was his biggest campaign contributor.

The FERC investigation was the latest of numerous probes into Enron's complex financial accounting practices, its relationship with accounting firm Andersen and potential securities fraud. The Securities and Exchange Commission, the Labor Department and the Justice Department all have probes, as do a number of Congressional committees.

The Senate Finance Committee wants information from the US Export-Import Bank, the Overseas Private Investment Corp and the Trade and Development Agency on aid to Enron through loans, guarantees and export credit insurance as well as on any Enron-related liabilities.

The Bush administration has said it intervened on Enron's behalf on a $2.9 billion power project in India that was partly financed by OPIC, which provides political risk insurance and loans to help US companies invest overseas.

DYNEGY GETS PIPELINE

Houston-based Dynegy won the right to acquire the 16,500-mile (26,554-km) Northern Natural Gas pipeline from Enron when its proposed $9 billion rescue merger fell apart on Novemebr 28. It paid a $23 million option exercise fee on Thursday to close the deal, which cuts Enron's pipeline assets in half.

Enron interim chief executive Steve Cooper said on Wednesday his plan to reorganise would focus heavily on building Enron in its old image as a company heavy in regulated physical assets like pipelines and power plants.

Enron was formed in 1986 from the merger of two old-line natural gas pipeline operators. Northern Natural Gas was a key asset of one of those companies, Internorth Inc, which joined Houston Natural Gas to form Enron.

Cooper told reporters on Wednesday he considered Enron's current and future litigation, like the $10.5 billion breach-of-contract suit filed against Dynegy over the Northern Natural Gas pipeline, a potential asset that could bolster his plan.

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