Firm says it will look at records of trading
April 4, 2003, 12:02AM
chron.com
Bloomberg Business News
NEW ORLEANS -- The energy-trading business owned by Entergy and Koch Industries
said Thursday it will review records disclosed last week by regulators, who said
the venture was among the biggest users of phony natural gas trades.
Entergy-Koch Trading made at least 61 so-called wash trades in 2000
and 2001 on an energy Web site run by Enron,
according to a review by the Federal Energy Regulatory Commission.
Entergy-Koch had previously denied making such trades,
which can be used to inflate revenue
and prices.
"We believe that our previous statements regarding wash trades were truthful based upon the
review and analysis that we conducted," spokeswoman Stephanie Goodman. "The FERC's
findings are based on more specific data than we had."
More than three dozen companies, including Enron, Reliant Resources Inc. and BP's North
American energy-trading unit, were accused of improper trading in the commission report last
week, after a 13-month probe of price manipulation during California's energy crisis of 2000
and 2001.
The improper transactions cited by the commission were wash trades, in which a company sells
gas and immediately buys it back at the same price and quantity. Using data supplied by Enron,
the energy commission found Entergy-Koch in March 2001 made 12 such trades in five minutes
through Enron Online.
Entergy-Koch was created in February 2001 by Wichita, Kan.-based
Koch Industries and New
Orleans-based Entergy, which owns utilities in Louisiana, Arkansas and Mississippi. Koch
trades commodities including natural gas and gold and manufactures
industrial products such as asphalt and fertilizer.
The venture's trading has increased as rivals such as Dynegy and Williams Cos. quit the
business or cut back amid mounting losses and disclosures by companies that they made bogus
electricity and gas transactions.
Entergy-Koch's review last year of its trading activity, which the company said found no
evidence of wash trades, had been based on incomplete data, Goodman said. |
