Enron Won't Sell Portland General to Northwest Natural Gas

Enron is terminating an agreement to sell its Portland General Electric unit to Northwest Natural Gas (NWN Quote).

The energy trader, which filed for bankruptcy in December amid a bookkeeping scandal, said both sides have mutually agreed to kill the deal, which was valued at around $1.8 billion. The termination of the pact requires the approval of the bankruptcy court overseeing Enron's Chapter 11 case.

"Although we had hoped to complete the sale to NW Natural, it was not possible to fully satisfy the terms of the pre-petition stock purchase agreement given issues associated with Enron's bankruptcy," Enron said in a press release, adding that it was "continuing to explore alternatives for our investment in PGE."

Enron is trying to formulate a plan that would allow the company to continue operating, albeit in a much smaller form, as a power and pipeline business. The success of the Portland General agreement was called into question earlier this month after Enron said its creditors might choose to accept a restructured version of the company that included the operation.