Enron cuts 4,000 US jobs

Enron has laid off 4,000 US employees after it filed for Chapter 11 bankruptcy protection.

Most of the jobs will go at the energy group's headquarters in Houston, Texas.

Enron spokesman Mark Palmer said that the group's North American power and gas trading operations were not affected.

JP Morgan Chase and Citigroup are reported to have agreed to provide Enron with up to £1bn (or $1.5bn) in new financing, allowing it to continue operating while in bankruptcy protection.

Meanwhile, Wessex Water in the UK says it's unaffected by the collapse of Enron.

While Enron owns part of Wessex's parent company Azurix Corporation, the water firm says neither it or Azurix has made any bankruptcy filing or is included in Enron's filing.

"Wessex Water acts as an independent business, ringfenced by UK regulation," the firm states. "It has its own board of directors and raises its own finance. It does not guarantee any debt of Azurix or Enron and has no commercial contracts with Azurix or Enron."

It is also reported that Dynegy, which abandoned a merger plan with Enron last week, has filed a countersuit against Enron in the US for its most valuable asset, the Northern Natural Gas pipeline.

Dynegy chairman and chief executive officer Chuck Watson told a conference call with analysts and shareholders that its lawsuit was provoked by Enron's "frivolous and disingenuous" decision to sue Dynegy for more than $10bn.

Mr Watson said that a regulatory filing on November 19, in which Enron revealed an imminent $690m notes repayment and noted that it had a cash balance of only $1.2bn, had triggered the final collapse of confidence.