Enron Canada in tit-for-tat lawsuits

Gary Park

Petroleum News Calgary correspondent

Enron Canada has launched lawsuits totaling more than C$500 million against companies it alleges broke natural gas and electricity contracts at the time its U.S. parent was tumbling into bankruptcy.

The list of 12 defendants includes Anadarko Canada, Marathon Canada (which was acquired in late summer by Husky Energy), Petro-Canada, Talisman Energy and Dynegy Canada, with the suits ranging as high as C$160 million.

Unlike its U.S. parent, Enron, the Canadian subsidiary has never filed for bankruptcy protection and has kept a small staff in Calgary to close out positions and execute contracts, although its energy trading operations have been taken over by Swiss investment banker UBS Warburg.

Filings by Enron Canada in Alberta Court of Queen’s Bench accuse the Canadian energy companies of unjustly profiting at its expense.

Under contracts negotiated from the mid-190s to 2001, Enron Canada bought natural gas in long-term deals extending to 2004, but as the cost of gas soared the contracts fell well below market value.

Energy companies have started their own legal actions against Enron Canada, claiming the company failed to pay them millions of dollars for commodities they delivered.