Mike Grigsby

Mike Grigsby was Director of West Desk Gas Trading and Vice President for natural gas trading at Enron North America. He managed the IM West physical book – one of the largest physical gas portfolios on the Enron trading floor – and specialized in Gas Daily basis products for Western markets, particularly Southern California (Socal), PG&E Citygate, and the Topock pipeline interconnect. Grigsby drove the West Desk’s transition from monthly to daily basis trading and developed new Gas Daily products for EnronOnline during a period when California’s energy markets were in crisis. He remained with Enron after the December 2001 bankruptcy filing, organizing skeleton trading operations in anticipation of a potential buyer.

Grigsby’s email archive in the Enron corpus contains approximately 2,757 messages spanning June 8, 2000, to November 30, 2002, with 157 unique senders. The correspondence documents his management of Western physical gas positions, his team leadership, and his day-to-day trading strategy during one of the most volatile periods in American energy markets.

Career at Enron

West Desk Gas Trading

Grigsby worked within Phillip Allen’s West Gas Trading Desk at Enron North America, which fell under the broader trading organization led by John Lavorato. Allen’s November 2000 organizational plan for the West Desk listed Grigsby as a Director alongside Janie Tholt and Steve South, with Keith Holst, Frank Ermis, and Tori Kuykendall serving as Managers beneath them.

By August 2000, Grigsby signed his emails with the title “West Trading.” His earliest archived emails from June 2000 show him already active in Western gas markets, and by September 2000 he had assumed management of the IM West physical book. In an email defending his access to the Executive Reports Viewer on September 14, 2000, Grigsby described his scope of responsibility.

This dual responsibility – running both a large financial book and the West physical book – placed Grigsby at the intersection of Enron’s financial derivatives trading and its physical gas operations for the western United States.

Team Management

Grigsby managed a team of traders and analysts focused on Western gas markets. His most prominent direct report was Monique Sanchez, whom he assigned to manage basis spreads for the West region. In a September 28, 2000, email requesting system access for Sanchez, Grigsby wrote: “Please add Monique Sanchez to the US GAS Basis products for the west region. She will be managing the OCT SJ, PERM, Scal, Opal, etc. basis spreads to the Henry Hub.”

He also coordinated closely with Anne Bike, whose name appears as one of his top signature terms in the corpus. Keith Holst, a Manager on the West Desk, was another close collaborator, with 89 emails exchanged between them.

In January 2001, Grigsby outlined his staffing priorities, including “Hiring a new analyst to track our spreadsheets, create our products and get them ready to trade each morning” and discussing promotions for team members: “I would also like to discuss the staffing issues. Matt Smith and Susan Scott to analyst, Jay to the ROX, etc. It seems like Ken S. has shown more interest in the west fundies lately. Should we keep his services?”

Grigsby provided performance reviews for colleagues across the gas trading operation. Writing about meteorologist Jose Marquez in June 2000, he noted: “The west desk is very pleased with Jose’s contribution. He has gone out of his way to assist each of us. Jose communicates the weather and its impact very clearly.”

Sanchez resigned in September 2001, with Grigsby announcing to the team on September 27: “Monique Sanchez has resigned and will be leaving Enron October 12. Monique is moving to Salt Lake City with her fiance and will be living in Deer Valley.”

Gas Daily Basis Products and EnronOnline

Grigsby’s signature contribution to the West Desk was driving the transition from monthly to daily basis trading and developing new Gas Daily products for EnronOnline. Basis products allow traders to hedge or speculate on the price difference between a regional delivery point and a benchmark hub like Henry Hub – a critical tool for managing geographic price risk in natural gas markets.

In a September 10, 2000, email, Grigsby described the strategic shift he was leading: “I am sure that you are aware of the move to daily basis from monthly. The west desk will be trying to phase out monthly for daily in the next month. We have created term gd basis vs. the HHub gd through apr-oct 01 for all index points.”

On September 4, 2000, he sent a detailed product development request outlining new instruments he wanted created for EnronOnline.

These products covered the major Western gas delivery points: San Juan Basin, Permian Basin, Malin (the Oregon hub serving Pacific Northwest markets), Kern River/Opal (Wyoming), and various California points. The Baja, Redwood on-system, and Redwood off-system spreads were particularly relevant to California markets, capturing price differentials between Southern California border points and the PG&E system.

Grigsby also thought carefully about the organizational structure needed to support this expanding product line. In a January 2001 email about the “cash book idea,” he wrote: “I have been thinking about the cash book idea for group and I think we need to discuss this in more detail. I would like to continue to use the physical for large prompt positions going forward. I am afraid that the baseload volumes may not continue on their current trend if we break out the books. We need to discuss how the cash books would lay off risk. i.e. Intra regional spreads with GD swap legs or spreads with other cash points and then booking out at gd mid to the internal counterparty.”

California Energy Crisis

Grigsby’s management of the West physical book placed him at the center of Enron’s gas operations during the California energy crisis of 2000-2001. His email volume spiked during this period, with 131 emails in September 2000 as the crisis began to intensify, and a peak of 556 emails in May 2001 – his single busiest month – as the situation reached its most acute phase.

Trading Strategy During the Crisis

Grigsby’s trading instructions during this period reveal active position management across Western delivery points. On September 10, 2000, he issued direction to his team: “Let’s continue to buy Socal for the rest of the month. I would like to sell Rockies, and remain neutral on Permian and San Juan, unless it looks like the maint on washington ranch will have a bullish effect on the basins. I will leave it up to you to determine.”

The directive to buy Southern California gas while selling Rocky Mountain production captures the widening basis spreads that characterized the early months of the crisis, as California demand outstripped pipeline capacity and drove regional premiums to extreme levels.

Nomination Management

As the crisis deepened in December 2000, Grigsby focused on the operational challenges of managing physical gas deliveries into California. On December 5, 2000, he sent detailed instructions to his logistics team.

The email reveals the operational pressures on physical gas traders during the crisis: pipeline capacity constraints on El Paso Natural Gas (EPNG), allocation cuts that required customer notification, and the risk of contractual penalties if notification procedures were not followed.

Utility Bankruptcy Watch

By May 2001, Grigsby was tracking the potential bankruptcy of California utilities. He circulated an update on May 7, 2001, noting: “Absent of last minute financial rescues by Davis or a new longer bridge loan package (unlikely) Socal could seek voluntary bankruptcy.” The reference was to Southern California Edison, which along with Pacific Gas & Electric faced insolvency from the combination of frozen retail rates and soaring wholesale power costs.

Key Correspondents

Grigsby’s communication patterns reflect his position as a hands-on trading desk leader embedded within the West Gas organization.

The heavy correspondence with Allen (181 messages) reflects the reporting relationship between Grigsby and the desk head who had handed him the physical book. The volume with Monique Sanchez (194 messages) underscores her role as his primary trader for basis products before her September 2001 departure. Communication with Lavorato (63 messages) indicates direct contact with senior trading leadership, not just filtered through Allen.

Post-Bankruptcy Operations

Grigsby was among the employees who stayed with Enron after the December 2, 2001, bankruptcy filing. His correspondence from late December 2001 shows him taking initiative to maintain the West Desk’s market knowledge and operational readiness.

On December 27, 2001, he wrote to the remaining team.

The reference to “a few of the Banks showing interest in showing a bid” foreshadowed the eventual sale of Enron’s trading operations to UBS Warburg in January 2002, which formed the basis of the Netco entity. Grigsby’s effort to keep his team informed and market-ready during the bankruptcy interregnum reflects both his operational commitment and the value that Enron’s gas trading expertise represented to potential acquirers.

His email activity continued at reduced levels into January 2002 (16 emails), with a final cluster of 13 emails in November 2002, likely related to data preservation or legal proceedings.

Email Activity

Grigsby’s monthly email volumes track closely with market conditions and the California energy crisis.

The near-total absence of email in July and August 2001 (only 5 messages combined) almost certainly reflects a vacation period rather than a gap in responsibilities. His return in September coincided with Sanchez’s resignation and the beginning of Enron’s corporate crisis. The October 2001 spike to 426 emails – his second-busiest month – came as Enron’s credit rating was downgraded and the company’s financial situation deteriorated rapidly.

Legal Status

No Department of Justice or SEC enforcement actions have been identified against Mike Grigsby in connection with Enron. While his West Desk managed physical gas trading during the California energy crisis – a period that generated extensive regulatory investigations by FERC and the California Attorney General into market manipulation – no secondary sources document specific allegations, charges, or depositions involving Grigsby personally. A TheStreet.com article referencing court proceedings noted Grigsby as a witness whose expenses were covered, but no finding of wrongdoing was reported.

See Also

• Phillip Allen – VP of West Gas Trading, Grigsby’s supervisor who handed him the physical book
• John Lavorato – President and CEO of Enron Americas
• John Arnold – VP of Gas Trading, ran the natural gas derivatives desk
• Hunter Shively – VP of Midwest Gas Trading, peer desk head
• Scott Neal – Gas trading desk head
• Matt Lenhart – Analyst on the West Desk
• Susan Scott – West Desk team member later promoted to analyst
• Louise Kitchen – President of Enron Net Works, ran EnronOnline

References

This article is based on Mike Grigsby’s email archive in the Enron corpus, containing approximately 2,757 messages (2,989 per the foundational database) from 157 unique senders spanning June 2000 to November 2002. Six verbatim email quotes are cited from the PST archive. Secondary sources include OSTI.gov research papers, TheStreet.com, CFTC and FERC records, and Cambridge University Press.