Essay: The fall of Enron Corporation

Sample Essay

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This essay discusses the fall of Enron Corporation. Enron Corporation was the creation of Kenneth Lay, a graduate of the University of Missouri, with a doctorate in economics from the University of Houston.

Enron Corporation was the creation of Kenneth Lay, a graduate of the University of Missouri, with a doctorate in economics from the University of Houston. (Cudahy and Henderson 35-110) After a change through the Federal Power Commission (FPC), which regulated natural gas and wholesale electricity prior to the FERC, (Cudahy and Henderson 35-110) he settled down in the natural gas industry, eventually landing at HNG, as chief executive. HNG was primarily an intrastate Texas pipeline. Believing that one had to grow to stay independent, Lay promptly obtained two other pipelines, in that way doubling the size of his own. Negotiations then develop for a merger with InterNorth, a much larger pipeline enterprise operating in the mid-continent. One of the conditions of the unification was that Lay would become CEO of the combined company in two years. In fact, it took Lay less than a year to assume the top office and then move the company headquarters to Houston, where the enterprise attain the name Enron. (Cudahy and Henderson 35-110) As owner of the largest interstate gas pipeline system, Enron gained from the increased requirement for natural gas transmission that resulted from industry deregulation. (Cudahy and Henderson 35-110)Further, as the volume of gas sales shifted away from long-term contracts in support of spot market transactions, (Cudahy and Henderson 35-110)

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