If the last Hoegh Galleon cargo of this year is diverted to Puerto Rico, the 
economics of sending non-Cabot LNG to Puerto Rico are different than those 
mentioned in my prior note.

Based on current prices, there is $0.7 MM of value that could be captured 
between Enron LNG and Eco on the diversion. This represents the price 
difference between what it would cost to buy back our sale to ENA at CMS and 
what Eco would have had to pay Cabot for a Winter Cargo. If CMS would let us 
out of the terminal fee or let it apply to a future delivery, that would add 
an additional $1 MM of value. If Cabot had to give up its Demand Charge and 
Demand Surcharge (hard to imagine) on the Winter Cargo, that adds another 
$4.7 MM.

A second Hoegh Galleon cargo should add $1.5 MM but would need to be sourced 
from Nigeria or Algeria(???). 

Cabot controls the date of the Last Cargo delivered in 2001. It can be 
November 23-December 15 (unless another date is mutually agreeable). The date 
of this last delivery determines the earliest date that Eco would be able to 
receive the Hoegh Galleon. The earliest that Eco could receive the Hoegh 
Galleon should therefore be between December 20 and January 11 - depends on 
Cabot. 

Eco would be able to receive a second Hoegh Galleon cargo as soon as 29 days 
after the first Hoegh Galleon cargo delivery or as late as 45 days after. Two 
Hoegh Galleon cargoes should give Eco enough fuel (barely) to get them to the 
dates where they are eligible to receive the Early Spring cargo (100 days 
after the Last Cargo of 2001). 

In addition to the $$$'s available to be captured, this program removes Eco's 
risk of not receiving a Winter Cargo from Cabot.

Economics and Timing -  The amount of value to be captured is most heavily 
influenced by December-January NYMEX prices. These impact our cost to buy 
back gas at the CMS tailgate and our cost to buy the second Hoegh Galleon 
cargo. Our gas cost is more subject to change than is the Cabot contract 
price we are trying to beat. If we had a crystal ball, we would lock-in the 
economics of the diversion and of the purchase of the second cargo when the 
NYMEX bottoms-out. The front of the price curve has lost ~$1.00/MMBtu in the 
last 2 weeks. Where will it go from here?

In order to be prepared to execute when market conditions are right, we need 
to get Eco on board and initiate discussions with a producer about supply for 
the second cargo. Also, we should talk with Gene Massey to confirm that the 
contract says what we think it says and to get his thoughts on what we are 
trying to do.

I would appreciate any insights that you may have regarding this opportunity.

Regards,

Paul
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