The Lessons Enron Taught
1985, was the year that Enron was born. The company was devised of two corporations that merged Houston Natural Gas and InterNorth. As a result of the merger Enron acquired huge liabilities and also lost exclusive rights to its pipelines because of deregulation . The company at this time was in survival mode and needed to earn profits. McKinsey & Co. was hired by then CEO, Kenneth Lay, to assist the business. Jeffrey Skilling was sent by McKinsey to assist Enron. This is when he developed the idea of creating a gas bank :
Enron would buy gas from a network of suppliers and sell
it to a network of consumers, contractually guaranteeing both
the supply and the price, charging fees for the transactions
and assuming the associated risk . The company would inter-
mediate between short-tern and long-term buyers and sellers
of natural gas. To guarantee
the supply Enron provided financing
to third party oil and gas producers .
The concept of the "gas......
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Approximate Word Count: 2461
Approximate Pages: 10 (260 words per double-spaced page) |