The Sarbanes-Oxley Act of 2002

Enron still had some lingering problems left over from its merger, however. The
company had to pay Jacobs, who was still a threat, over $350 million and reorganize
the company. Lay sold off any parts of the company that he believed didn't belong in the
long-term future of Enron. Lay consolidated all the gas pipeline efforts under the Enron
Gas Pipeline Operating Company.
In addition, the company began to ramp up its electric power and natural gas efforts. In
1988 and 1989, the company began adding power plants and cogeneration units to its
portfolio. In 1989, Jeffrey Skilling, then a consultant at McKinsey & Co., came up with
the idea to link natural gas to consumers in more ways, effectively turning natural gas
into a commodity. Enron adopted the idea and called it the "Gas Bank." The division's
success prompted Skilling to join Enron as the head of the Gas Bank in 1991.
Another major development inside Enron was the beginning of the company's pivot to
overseas that was expanded upon in the 1990s.
Starting in 1989, the company received a $56 million loan from the Overseas Private
Investment Corporation (OPIC) for a power plant in Argentina.
Enron Complex
in Downtown Houston
Timeline (1985–1992)
1980s
New regulations gradually create a market-pricing system for natural gas.
Federal Energy Regulatory Commission (FERC) Order 436 (1985) provides
blanket approval for pipelines that choose to become common carriers
transporting gas intrastate. FERC Order 451 (1986) deregulates the wellhead,
and FERC Order 490 (April 1988) authorizes producers, pipelines, and others to
terminate gas sales or purchases without seeking prior FERC approval.
As a result of these orders, more than 75% of gas sales are conducted through
the spot market, and unprecedented market volatility exists.
July 1985
Houston Natural Gas, run by Kenneth Lay merges with Internorth, a natural gas
company in Omaha, Nebraska, to form an interstate and intrastate natural gas
pipeline with approximately 37,000 miles of pipeline.
November 1985
Lay is appointed Chairman and Chief Executive of the combined company. The
company chooses the name "Enron" after rejecting "Enteron"
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