Enron Forking Over $1.5B To States

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Bankrupt energy company Enron Corp. has agreed to pay more than $1.5 billion to resolve claims that it gouged California and other western states during the 2000-01 energy crisis, state officials said.

The settlement will end market manipulation and price-gouging claims against the once high-flying Houston-based company, California Attorney General Bill Lockyer said. The agreement requires approval by the Federal Energy Regulatory Commission.

Enron will pay $47.5 million in cash and provide California with an unsecured claim for $875 million in the energy company's bankruptcy proceedings. Oregon and Washington will recieve $22.5 million each from that unsecured settlement.

In addition, the three states will share a $600 million penalty.

The deal will allow California to "squeeze justice from this corporate turnip," Lockyer said. "All things considered, this is a good resolution for the state's ratepayers."

Enron's ultimate payments to the states won't be known until its bankruptcy proceedings end, Lockyer spokesman Tom Dresslar said.