A Calgary judge on Thursday rejected a bid by Enron Canada, a unit of Enron Corp., for a court order to prevent contract cancellations by Canadian marketers and producers. The move effectively will push Enron Canada into insolvency and bankruptcy is expected.

Enron Canada had requested a one-month stay in natural gas and power contract terminations to restructure its finances and to obtain its own credit rating after Enron Corp. filed for Chapter 11 bankruptcy last Sunday after most of its suppliers, including Anadarko Petroleum Corp., Calpine Corp., Talisman Energy Inc., Murphy Oil Corp. and ChevronTexaco, pulled out. Enron Canada said at least 74 companies had already cancelled contracts.

In hindsight, said Enron Canada CEO Robson Milnthorp, “I wish I would have tried to do this sooner, but you put faith in your parent company. Things eroded very, very quickly and we reacted as quick as we could.”

Lawyers representing companies holding Enron Canada contracts said they are entitled to terminate the contracts because they are worried that it would not be able to meet its financial obligations. Enron purchases about C$500 million in energy a month from hundreds of suppliers in Canada.

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