ISDA PRESS REPORT - APRIL 30, 2001

Liquidity & The ISDA Master Agreement - Derivatives Week
Deregulation fails to deliver - Financial Times
Merchant Banking Capital Proposal Draws a Chorus of Industry Criticism - BNA
Euro swap spreads seen sideways, U.S. to narrow - Reuters
Fed's Greenspan's speech to Bond Market Assn - Reuters
Enron Offers Structured Weather Note - Derivatives Week

Liquidity & The ISDA Master Agreement
Derivatives Week - April 30, 2001

Ensuring liquidity should be the primary goal in negotiating an ISDA Master
Agreement (the "Agreement") for smaller, non-rated customers, such as a
hedge fund or a middle-market corporation. Often highly leveraged and with
little room for error, these customers should focus their efforts when
negotiating the Agreement with a dealer on limiting the dealer's opportunity
to terminate the Agreement. Unfortunately, however, customers (typically
through expensive outside counsel), often instead use up valuable
negotiating capital on esoteric legal issues that may only remotely affect a
customer's situation.

A dealer typically wants the right to terminate the Agreement at the first
sign of its customer's economic difficulties, such as a cross default or a
decline in the customer's net worth. Because of the fluctuating nature of
derivatives, a dealer wants to quickly terminate any growing exposure from
outstanding transactions as its customer's credit deteriorates. Early
termination of its Agreement with the dealer, however, may only further a
customer's growing liquidity crisis.

Upon early termination, a customer that is out-of-the-money on its trades
with the dealer may end up having to make large termination payments.
Depending on its agreements with other dealers, an early termination could
possibly give other dealers the right to terminate their agreements with the
customer. Even if the customer is in the money, it may not be able to
replace important terminated hedging transactions. Termination of the
Agreement may be the beginning of the end for a customer in economic
difficulty.

Cross Default

One of the most important signs of a customer's financial deterioration for
a dealer is the occurrence of a cross default by the customer with one of
its other creditors. Under the Agreement, a cross default takes place upon
the occurrence or existence of an event of default with respect to
"specified indebtedness". For the provision to apply, however, the parties
must affirmatively elect for the cross default provision to apply to either
or both parties.

The parties must also agree on the definition of specified indebtedness.
Specified indebtedness is defined in the Agreement to be "any obligation
(whether present or future, contingent or otherwise, as principal or surety
or otherwise) in respect of borrowed money." Dealers often will want to
expand the definition beyond the concept of "borrowed money" to include
obligations under other types of financial transactions, such as forwards,
repurchase agreements, securities lending agreements, or even exchange
derivatives such as futures and options. Dealers may even try to define it
to include any contractual obligations of the customer. The broader the
definition of specified indebtedness, the more likely that a cross default
will occur to the customer.

In addition, many of the new types of obligations added to the definition of
specified indebtedness, such as repos, are prone to technical defaults.
Although these technical defaults are generally cured or waived in the
ordinary course of business, they could provide an aggressive dealer with an
opportunity to terminate the Agreement upon their occurrence.

The parties must also agree on appropriate cross default thresholds. This is
the amount that a default must exceed before it will constitute a cross
default. Although the dealer will want a threshold of 2-3% of its equity for
itself, it will insist on a more modest number for the customer ranging from
$0-20 million. The smaller the threshold, the more likely that a cross
default will occur to the customer.

In addition, as with all cross default provisions, the customer should be
careful that the agreed upon threshold amount not be lower than its cross
default threshold in its other finance agreements. For example, if the
threshold were lower in the Agreement than the threshold under its loan
agreement, a small payment default on specified indebtedness might trigger
the cross default under the Agreement, which in turn might inadvertently
trigger the cross default under its other finance agreements.

A customer should insist that a cross default only occur upon the "cross
acceleration" of the other indebtedness, as opposed to merely the existence
of a default. Under the standard cross default language in the Agreement, an
event of default can occur upon a default under other indebtedness,
irrespective of whether the other creditor accelerates the specified
indebtedness. By requiring that the default result in an acceleration of the
underlying indebtedness, a dealer would not be able to terminate the
Agreement until the other creditor actually accelerated the specified
indebtedness.

Dealers generally resist a cross acceleration requirement because it limits
their ability to concurrently negotiate with its customer during any
work-out discussions the customer might be having with another lender. For
example, a creditor could persuade the customer to pledge additional
collateral in exchange for not accelerating the indebtedness. If the dealer
could not declare a cross default under the Agreement at that same time, it
would not be able to negotiate the same terms with the customer as did the
other customer's creditors.

Credit Event Upon Merger

A "credit event upon merger" is a termination event under the Agreement. It
occurs if a party participates in a merger (or enters into a similar type of
transaction) and the resulting entity is "materially weaker" after the
event. The rationale for the provision is that a party may not have entered
into the Agreement with the customer that is now materially weaker because
of a merger. Like the cross default, the parties must elect for the credit
event upon merger to apply.

Unfortunately, the term "materially weaker" is not defined in the Agreement.
The dealer may attempt to define an objective test that would measure when
the resulting entity becomes materially weaker. For example, the resulting
entity would be considered materially weaker if its credit rating were
materially affected or if it failed designated financial covenants.

The parties may also want to expand what is meant by a credit event upon
merger. The dealer may suggest that recapitalizations through the issuance
of new forms of stock or debt would constitute a credit event upon merger. A
customer may want to resist such a definitional change because of the
potential restrictions it could pose on its ability to change its capital
structure. The occurrence of such a change in its capitalization, however,
would still require the resulting entity to be materially weaker to
constitute a termination event.

Additional Termination Events

A dealer may insist on adding "additional termination events." Additional
termination events are generally treated under the Agreement similar to
events of default. If an additional termination event has occurred with
respect to a party, that party is referred to as the "affected party." Upon
the occurrence of such an event, the dealer would have the right to
terminate the Agreement at a time precisely when the customer most needs to
maintain its liquidity.

The most common additional termination events negotiated are those that
result from a change in the financial condition of the affected party. This
could be triggered by a credit downgrading or by the failure to maintain a
certain level of capital or net worth, or a failure to maintain certain
financial ratios.

An additional termination event could also result from a problem unique to
the counterparty such as the failure of an Affected Party to maintain a
certain legal or regulatory status. Failure to notify the non-affected party
of certain events or to deliver certain information could also be an
additional termination event. Finally, if the affected party is dependant on
the leadership or direction of certain individuals, the resignation or death
of such individuals could also result in early termination.

Son of First Method

Designating "first method" as a method for determining damages upon the
termination of the Agreement has become obsolete. The effect of first method
was to deprive the defaulting party of any payments upon the termination of
the Agreement in the event that the defaulting party was "in the money".
Now, however, dealers are often insisting on the right to delay making
payments to a customer upon an early termination of the Agreement until the
dealer is completely satisfied that the defaulting party has no further
payment obligations to it, something that could takes days or even weeks to
resolve.

Delaying payments on an early termination date, however, can result in
significant liquidity problems for a customer. Upon an early termination of
the Agreement, if the customer is in the money, it is probable that a
customer may be counting on the dealer's payment in order to meet any
obligations it has on the early termination date to other parties. If such
payments were withheld by the dealer, the customer would be unable to use
such amounts to meet its obligations with other counterparties, perhaps
triggering additional defaults under other agreements for the customer.

Limiting Cure Periods

The Agreement was drafted by ISDA with cure periods much more liberal than
may be typically seen in other finance contracts due to what drafters viewed
as the unique characteristics of the OTC derivatives market. Dealers,
however, have begun to limit these cure periods. For example, instead of
permitting a customer three business days to cure a payment default, the
dealers are narrowing it to one. Similarly, dealers are requesting only a
five-day cure period for breach of certain other provisions while the
agreement normally provides for 30. Narrowing of such cure periods may not
be in a customer's best interest. These more limited cure periods are
probably not sufficiently long for a customer experiencing economic
difficulties to resolve the underlying defaults.

Although there are numerous legal issues affecting the ISDA Master Agreement
that are negotiated, the most probable issues that may affect a smaller
customer deal with terminating the agreement upon the occurrence of some
financial difficulty. Because of that, the customer should focus its efforts
on limiting as much as possible these early termination opportunities.

Deregulation fails to deliver
Financial Times - April 30, 2001
By Geoff Dyer

The lights are not blazing at the presidential palace in the Brasilia
night-time as they once did. It is not because the staff are taking it easy,
however. The economy measure is aimed simply at saving energy. This is more
than just a symbolic gesture. Since the beginning of April, all government
offices, from that of the lowest bureaucrat to huge those in state-owned
corporations, have been under orders to cut energy consumption by 10 per
cent.

Private sector companies and ordinary households are also being urged to
trim their energy usage, before the lights go out involuntarily.

The saving measures are Brazil's last-ditch attempt to stave off a
full-blown energy crisis, and has prompted many comparisons with the partial
deregulation disaster in California. Yet, even with these cutbacks,
ministers have already admitted that Brazil will need some form of energy
rationing later in the year to avoid the risk of serious blackouts.

The official culprit for the energy shortage is the weather. Patchy rainfall
has left the reservoirs in the industrialised south-east of the country only
a third full, when they should normally be at half their capacity at this
time of year. Given that more than 90 per cent of Brazil's energy comes from
hydro-electric plants, this presents a serious problem.

Behind the unreliable weather, however, lies a generation of
under-investment. The debt crisis in the early 1980s cut off foreign
financing for the sector, while the fiscal problems that came with rampant
inflation in the late 1980s and early 1990s constrained the state's ability
to invest.

Liberalisation and privatisation during the past six years have not resolved
the problem. In the period 1995 to 1999, according to the National
Development Bank (BNDES), growth in generating capacity was 3.4 per cent a
year, while electricity consumption expanded annually by 4.4 per cent.

Like California, the deregulation of the Brazilian energy sector has been a
half-way house that has pleased neither supporters or critics. While most of
the electricity distribution companies have been sold off to the likes of
AES of the US and Spain's Endesa, the bulk of generation capacity - where
most of the new investment is needed - remains in public hands.

Political disputes have led to the persistent postponement of plans to sell
Furnas in the south-east and Chesf in the north-east. Meanwhile, the
government's fiscal austerity drive - agreed with and painstakingly
monitored by the International Monetary Fund - has tied its hands from
making the necessary new investments.

The regulatory environment has also been heavily criticised. The government
had been hoping to encourage a boom in gas-powered plants, especially using
the Bolivia-Brazil gas pipeline, which was opened in 1999. However, the new
thermal plants have come on stream more slowly than expected, partly because
would-be investors were worried about having to pay for the gas in dollars,
while their revenues would be in reals.

Neither has the government induced the investments in transmission networks
that might have alleviated the situation. The south of the country has
actually experienced normal rainfall this year. However, as Sandra Boente,
an analyst with Salomon Smith Barney, noted in a recent report:
"Unfortunately, there is not enough transmission capacity to shift that
excess power supply to the consumption centres in the south-east."

At least businesses cannot claim to have been surprised by the potential
energy crisis. Industry groups have been warning their members for several
years not to believe government pledges that there would be no rationing.

As a result, a some companies have invested heavily to create their own
generation facilities. Ambev, the largest brewer in Latin America, is
spending RDollars 60m on 10 different gas-fired power plants at its
factories with a total capacity of 61MW which it hopes to have in operation
by the end of next year. The plants will cover two-thirds of its energy
needs and also save up to 20 per cent on its production costs.

Another government tactic has been to lean on Petrobras, the state-owned oil
and gas giant, to take part in more thermo-electric plant projects. The
company has been authorised to invest in a further two plants, with capacity
of more than 1,000MW which takes the total number of plants in which it is
involved to 12.

Yet, it is Petrobras which has also contributed to the growing sense of
unease about both the country's energy sector and the government's
liberalisation policies. The sinking of the world's largest offshore oil
production platform off the coast of Rio de Janeiro in March was a huge blow
to national self-esteem. President Fernando Henrique Cardoso described the
event as "our Challenger", in a reference to the explosion of the US space
shuttle.

The accident followed a string of environmental disasters at Petrobras
operations, including a massive oil spill in Rio's Guanabara Bay which
endangered some of the city's beaches. And while the oil rig was staffed by
employees of the company, many of the accidents have occurred at facilities
where the operations have been outsourced to third-party companies.

In the public eye, at least, the result has been to tarnish the deregulation
of the sector, which has seen Petrobras lose its monopoly on exploration and
production of oil and a new management team try to make the company more
transparent and efficient.

The new-look Petrobras has been winning supporters among the financial
community, however, with record profits last year of RDollars 9.94bn - the
largest ever by a Brazilian company. These stemmed not just from the high
oil price but also from streamlined operations and increased production.

Merchant Banking Capital Proposal Draws a Chorus of Industry Criticism
BNA - April 30, 2001
By Richard Cowden

After opposing a March 2000 proposal to impose 50 percent capital charges on
merchant banking activities, several banking organizations now are making
the case that such charges are unnecessary altogether, according to comment
letters on a new proposal.

The Federal Reserve Board and the Office of the Comptroller of the Currency
Jan. 22 jointly issued the proposal to establish a rule governing capital
requirements for merchant banking activities approved by the 1999
Gramm-Leach-Bliley Act.

Under the agencies' proposed sliding scale, a financial holding company
making equity investments in nonfinancial companies that account for less
than 15 percent of its Tier I capital would be subject to an 8 percent
capital charge on such investment. Certain exceptions would include
investments made through a small business investment company.

An FHC investing between 15 and 25 percent of its Tier 1 capital in
nonfinancial companies would be subject to a 12 percent capital charge, and
an FHC making such investments accounting for more than 25 percent of its
Tier 1 capital would be assessed a 25 percent capital charge (15 DER A-19,
1/23/01).

Signaling their low expectations that they can fend off a sliding scale of
capital requirements in the proposal, many respondents addressed their
remarks to limiting the eventual rule's impact on existing investment
banking activities. The proposal asked for comments on whether certain kinds
of investments made prior to the March 13, 2000, the date of the original
proposal should be exempted from the rule.

Writing for the Securities Industry Association, James E. Reilly, chairman
of its holding company committee, said his organization "continues to
believe that the Agencies should allow firms to rely fully on internal
capital allocation models to control the risks of nonfinancial investment
activities." In the SIA's view regulators' concerns about the reliability of
such models "can be addressed through supervision and examination, as is
currently done in connection with capital allocation for market risk."

Richard Whiting, executive director and general counsel of the Financial
Services Roundtable, echoed that theme. In his comment letter, he wrote that
the January proposal "presents an unnecessarily burdensome array of
restrictions that are neither mandated by safety and soundness, nor in
keeping with the language or spirit of the Gramm-Leach-Bliley Act."

Whiting emphasized that the proposed capital requirement was not
contemplated by lawmakers when they enacted the GLB Act. "The Roundtable
believes that, more than any other provision of the GLB Act, the merchant
banking restrictions in both proposed and final rules have impeded non-bank
firms from becoming FHCs (financial holding companies)," Whiting said. "In
evaluating the merchant banking rules, it is important to note that neither
the traditional securities industry, nor the venture capital and private
equity investment industries, seem to have overcome their aversion to FHC
status under the GLB Act."

That comment reflected the sentiments of many in the financial services
sector that the capital rules will undercut the benefit of winning
permission for depository institutions to participate in merchant banking,
one of the centerpiece provisions of the GLB Act. Beth Climo, executive
director of the American Bankers Association Securities Association, wrote
in a comment letter that her group "remains concerned that any special
capital charge assessed against FHCs engaged in merchant banking activities
will further exacerbate the inequities between FHCs and non-FHCs engaged in
merchant banking activities."

Federal regulators have acknowledged the industry's concerns in this regard.
In his April 4 testimony before two subcommittees of the House Committee on
Financial Services, Federal Reserve Governor Laurence H. Meyer said the
proposed capital requirements would be a "bridge" to an eventual approach
that would use the FHCs' internal models.

Reilly wrote, "SIA recommends that if ... the Agencies determine to adopt
their capital proposal, the final rule should contain a 'sunset' provision
or, at minimum, a specific date by which the Agencies will formally
re-examine and re-evaluate the need for the capital haircuts."

Exemptions for SBICs

The capital proposal would exempt FHC investments in Small Business
Investment Companies up to 15 percent of Tier 1 capital. SBICs are licensed
and regulated by the Small Business Administration and provide equity
financing, long-term credit and technical support to small companies.
Despite this special exception, the proposed rule would include investments
in an SBIC toward the overall amount that would be considered in determining
the capital charge level to which the FHC would be subject.  Groups
representing both large and small financial institutions criticized this
provision. Charlotte M. Bahin, director of regulatory affairs and senior
regulatory counsel for America's Community Bankers, wrote, "Imposing higher
capital charges on such investment activities by banking organizations may
well have a negative impact on this important source of capital."

Whiting wrote, "If it is concluded that no special capital charge is
appropriate for SBIC investments, we see no reason to conclude that a
non-SBIC investment should have a higher capital charge because there is a
certain level of SBIC investments."

Many commenters also voiced concerns that under the proposal a series of
other kinds of equity investments that had been authorized before passage of
the GLB Act also would count toward the total used in determining whether an
FHC exceeded the 15 percent or 25 percent thresholds. Those investment types
would include non-controlling equity investments made under sections 4(c)(6)
and 4(c)(7) of the Bank Holding Company Act; portfolio equity investments
made under Regulation K; and most equity investments by state-chartered
banks under section 24 of the Federal Deposit Insurance Act.

Grandfathered

The proposal would make existing permissible investments, such as those in
SBICs, subject to the capital charge rule as of March 13, 2000, the date of
publication of the original proposed rule. That provision also drew strong
criticism. Reilly wrote, "Imposing a capital charge on these investments,
without any evidence that such investments pose a safety and soundness risk,
would penalize institutions for engaging in long permissible activities ...
SIA respectfully submits that imposing a capital charge retroactively is
akin to altering the rules in the middle of the game, and doing so could
have adverse consequences."

Reilly also suggested that such investments should be grandfathered not only
from the March, 2000, date but from the date on which the agencies issue the
final capital rule.

Mixed Activities

Whiting addressed a feature of the proposal that he said could result in
inequities for FHCs that invest in companies whose operations involve a
mixture of activities. In some cases the firm in which the investment is
made may engage in activities that are clearly permissible under the Bank
Holding Company Act because they are "incidental and complementary" to
financial activities, while there may be questions about the permissibility
of other activities, he said.

Under the proposed rules, if an FHC invested in such a company, Whiting
wrote, it would have to do so under its merchant banking authority and might
have to wait for the Federal Reserve Board to rule on the permissibility
question. "Read literally," he wrote, "the special capital charge would
apply to the entire investment in a company even if its financial and
incidental activities represented 99 percent of its total revenues and
assets. We believe that such a result is illogical and inequitable."

Whiting suggested this matter could be dealt with by applying the capital
charge only to the amount of the investment that equals the portion of the
company's revenues that are not attributable to permissible activities.

Euro swap spreads seen sideways, U.S. to narrow.
Reuters - April 30, 2001
By Nigel Stephenson

LONDON, April 30 (Reuters) - Swap spreads have tightened markedly in recent
weeks as rate cut expectations have seen bond yield curves steepen but
analysts say that while dollar spreads could narrow further, euros could
steady or even widen.

The 10-year U.S. dollar swap spread has narrowed since the beginning of the
year, when the Federal Reserve embarked on a series of aggressive interest
rate cuts, to 80 basis points on Monday from 104 on December 28.

"Swap spreads are going to come in the U.S. because we still have a very
aggressive rate cut priced in," said Meyrick Chapman, derivatives analyst at
UBS Warburg.

Euro-zone swap spreads also narrowed in January but then moved out and
sideways until late March. The 10-year euro spread narrowed to 43 basis
points on Friday, close to one-year lows, from 56 on March 22. It stood at
44 on Monday.

"In Europe, the expectation of cuts has brought in swap spreads but we are
not getting any rate cuts right now and that is one of the reasons we might
move sideways," Chapman said.

His target was for the 10-year dollar swap spread to hit 65 basis points in
six months. The 10-year euro swap spread would narrow to just 38 or 39.

Swap spreads, the difference between the swap rate and the government bond
yield at any maturity, are gaining importance as a measure of bond
performance and of risk appetite.

A prime driver of the dollar swap spread has been the rapid steepening of
the yield curve. The 2-10 year Treasury spread has steepened to more than
100 basis points from 20 at the beginning of this year.

Chapman said the 2-10 year spread could widen to 120, having a further
positive impact on swap spreads.

Jim Reid, credit strategist at Barclays Capital, also said dollar swap
spreads could narrow further, to the low to mid-70s over three months.

SPREADS HELD BACK BY EMERGIBG MARKETS, EQUITIES

He said that while they were driven inwards by rate cuts, they had been held
back by concern over emerging markets and equities, which often see credit
underperform.

"If there is any stability in equity markets and any emerging markets
positive news flow, you are going to get swap spreads performing in
dollars."

He saw the 10-year euro swap spread moving out to 48 or 49 basis points over
three months.

With any lowering of interest rates in the euro zone expected to be modest
in comparison with the easing seen in the U.S., analysts said European
Central Bank cuts would not have a major impact on swap spreads.

"It is already pricing in probably a more aggressive rate cut than you could
possibly see for the next three months," Reid said.

"The risk reward is definitely for (euro swap spreads) to widen from here,"
he added.

Jose Sarafana, strategist at WestLB in Duesseldorf, said that after the
recent significant narrowing, euro-zone swap spreads could be ready for a
correction.

He recommended last week that investors consider switching into German
government bonds from peripheral euro-zone bonds, which would underperform
as swap spreads widened.

However, longer-term fundamentals supported a further narrowing of spreads.
He saw the 10-year at 40 by year-end.

"The economy is slowing, governments have to issue more debt than expected
and this should increase the supply. So we should see some underperformance
of government bonds versus credits."

Further steepening of the U.S. bond yield curve should see the 10-year
dollar swap spread at 65 basis points by year-end, Sarafana said.

Fed's Greenspan's speech to Bond Market Assn.
Reuters - April 27, 2001

WASHINGTON, April 27 (Reuters) - The following is a the full text of Federal
Reserve Chairman Alan Greenspan's speech delivered in Washington Friday on
"The Paydown of Federal Debt" to the Bond Market Association in White Sulfur
Springs, W.Va.:

"I am pleased to be with you this morning and note the Bond Market
Association's twenty-fifth anniversary. Over the years I have enjoyed being
associated with many of you in this audience. My very best wishes to Heather
Ruth on the last day of her tenure as president and congratulations to Micah
Green upon his appointment.

Today I want to address a subject in which your group and the Federal
Reserve share a keen interest--the paydown of the federal debt and its
implications for the economy and financial markets. While the magnitudes of
future federal unified budget surpluses are uncertain, they are highly
likely to remain sizable for some time. The dramatic improvement in
projections of the budget balance in recent years reflects, in large
part, the pickup in underlying productivity growth in the U.S. economy,
which has boosted corporate profits and household incomes and thereby tax
receipts. In effect, we built a tax structure on the assumption that the
economy would grow over time at rates around those seen from the early 1970s
to the mid-1990s, and this structure has generated considerably more revenue
as the economy's underlying growth rate has risen. Restraint
on expenditures also has contributed to the brighter outlook.

Tight limits on spending were imposed in response to the large deficits of
the 1980s and early 1990s, and defense spending was reduced following the
end of the Cold War.
Both the Office of Management and Budget and the Congressional Budget Office
have assumed that much of the accelerated productivity growth of the late
1990s is likely to be sustained through the next decade. No doubt, a period
of weakness in measured productivity is likely to accompany the current
slowdown in economic activity. However, there is little in the recent data
to suggest that any significant alterations in these agencies' longer-term
projections of structural productivity growth might be required.

Should we infer from these positive budget developments that unified budget
deficits are no longer conceivable? Hardly. The substantial surpluses in
retirement programs (especially social security) in recent years and in the
nearer-term budget projections are on a cash basis. Were we fully accruing
the benefit liabilities inferable from existing law, these retirement
programs would currently be in deficit, and contingent liabilities amounting
to about $10 trillion for social security alone would have been added to the
current debt to the public.

When the baby boom generation retires, and as the population subsequently
ages further, these contingent liabilities will come due and--barring an
offsetting surplus in the remainder of the government's budget--will be met
by the issuance of Treasury securities, shifting much of total federal
liabilities from contingent liability to debt to the public. At
that point, of course, the unified budget will be in deficit.

Of more relevance for the nearer term, current forecasts suggest that under
a reasonably wide variety of possible tax and spending policies, the
resulting surpluses will allow the Treasury debt held by the public to be
paid off. Moreover, well before the debt is eliminated--indeed, possibly
within a relatively few years--it may become difficult to further reduce
outstanding debt to the public because the remaining obligations will mostly
consist of savings bonds, well-entrenched holdings of long-term marketable
debt, and perhaps other types of debt that could prove difficult to reduce.
Whether economic developments and tax and budget choices will, in the end,
produce surpluses of the order of magnitude currently projected is open to
debate. But the probability of substantial continuing surpluses is
sufficiently high to require that, at a minimum, we begin to address their
potential implications for fiscal policy decisionmakers, financial markets,
and the Federal Reserve.

I have long argued that paying down the national debt is beneficial for the
economy: It keeps interest rates lower than they otherwise would be and
frees savings to finance increases in the capital stock, thereby boosting
productivity and real incomes. But the current budget projections are such
that we need to consider what path of debt reduction is best for the
economy. The issue is complicated: On the one hand, higher national saving,
by raising the nation's capital stock, leaves the country better prepared to
cope with the economic effects of the aging of the U.S. population--and one
way to achieve that higher saving is to run budget surpluses. On the other
hand, after a point, this increase in national saving comes at a cost. Once
Treasury debt reaches itsirreducible minimum, additional surpluses will, of
necessity, lead to the accumulation of substantial private--that is to say,
non-federal-assets either in the Treasury's general fund or in government
trust funds.

The decisions on how such funds should be invested by the government would
necessarily be political ones, and would lead to efforts by some groups to
obtain via the political process funding that they could not obtain, at
least at the same price, in private markets.

These efforts would likely result in distortions in the allocation of
capital that must be balanced against the benefit to the nation of the
increase in saving. In fact, it is the market-driven allocation of capital
and labor to their most productive uses that has fostered our recent
impressive gains in productivity and encouraged inflows of capital that have
enabled us to build an extraordinarily efficient capital stock despite quite
modest levels of domestic savings.

The effectiveness of our markets in allocating capital is one of our
nation's most valuable
assets. We need to be careful not to impair their functioning.  It is,
regrettably, too easy to envision political pressure being exerted to use
government financing of investments to offset perceived capital market
imperfections. Experience suggests that in such cases the resulting returns
earned on the investments are likely to fall short of market standards.
Moreover, the social benefits of investment are likely to be very difficult
to measure in practice, opening the door to political interference in the
allocation of funds.

It is difficult, for example, to envision effective constraints being placed
on politically attractive investments by defined-benefit trust funds, such
as the social security trust fund. Benefits are guaranteed by government,
irrespective of any losses to the fund. Thus, one must presume that even if
our social security trust funds were to be so seriously impaired by
mismanaged government investment that they dried up, full benefits would be
highly likely to be forthcoming despite the fact that under current law the
social security trust fund has limited borrowing authority. As a result,
prospective beneficiaries would have no incentive to police the investment
policies of the trust fund.

To be sure, we do have about $3 trillion of assets administered in the
defined-benefit plans of state and local governments. While research in this
area has been limited, it does indicate that state and local pension funds
have tended to underperform private pension funds if required to direct a
portion of their investment within the state or to make "economically
targeted investments."

Some recent work has suggested that the negative effects of such
requirements may have been less important in recent years than they were in
the past, but that conclusion remains
speculative. Along the same lines, there is some evidence suggesting that
returns on state pension funds have been lower where the proportion of
trustees who are political appointees is higher.

Some have argued that methods could be devised to insulate government
investment decisions from the political process even in defined-benefit
funds, perhaps by limiting such investments to index funds. Even if such
methods were successful, the government would be investing only in publicly
traded securities, and so its investment might have an adverse effect on the
relative financing costs of smaller, often quite productive,
non-publicly-traded firms.

Over time, these effects would presumably be arbitraged away. But such a
process likely takes time, and capital market imperfections, in any event,
are likely to impede full arbitrage.  Arguably, defined-contribution funds,
even if administered by a federal agency, could insulate investment policy
from political interference, as well as potentially freeing investment from
the straightjacket of holding only index funds. It is highly unlikely that
the beneficiaries of such funds would countenance politically convenient
investments in their retirement funds. Indeed, the $100 billion federally
managed Thrift
Savings Fund has been operated without such interference. I should note,
however, that conversion of social security from a defined benefit plan to a
defined contribution plan would fundamentally alter its nature.

One way to employ unified budget surpluses to finance increased investment
would be to convert such funds into individual retirement accounts owned and
administered by beneficiaries, with the presumption that the funds would be
fully dedicated to retirement. In such an instance, the resulting reduction
in government saving would be offset by a rise in private saving, so that
total domestic saving would be maintained, though the availability of newly
owned private assets could reduce the propensity to save out of income
somewhat.

Given concerns about the potential distorting effects of asset accumulation
by the Treasury or in government defined-benefit plans, we need to carefully
consider the appropriate path of debt paydowns.  By addressing this issue
now, we can avoid an abrupt and potentially disruptive change in fiscal
policy as the level of Treasury debt reaches its irreducible minimum.

Despite the clear advantages of paying down the federal debt, I recognize
that doing so has some potential adverse consequences even before the
difficulties associated with government accumulation of private assets
arise. The Treasury market serves a number of useful purposes (in addition
to providing many of you with profitable employment). Most obviously,
Treasury debt provides an asset that is free of credit risk - a
characteristic that is desirable for many investors, especially in times of
economic or financial turbulence.

Treasury yields also provide a benchmark for the quoting and pricing of
risky debt. In addition, the size and liquidity of the Treasury market allow
market participants to hedge interest rate risks easily and at low cost.
Moreover, the liquidity of these securities enables participants to make
rapid adjustments to their portfolios in times of market volatility.

Thus, the elimination of Treasury debt does remove something of economic
value, and it will require that significant adjustments be made by market
participants. Indeed, with marketable Treasury debt held by the public--that
is, excluding the Federal Reserve but including foreign central
banks--having declined about 20 percent in recent years, to less than $2.5
trillion, some of these adjustments have already begun.

Reportedly, firms have increasingly turned to swaps, agency securities, and
even larger corporate debt issues to do their hedging. After a period of
transition, such shifts arguably should not have any significant adverse
effect on risk management. As hedging activity moves from the shrinking
Treasury market to alternative markets, the liquidity of those markets
should improve. Yields on the alternative hedging instruments likely will
track at least as closely with those on instruments commonly being hedged as
do Treasury yields.

Similarly, the loss of Treasury securities as benchmarks seems unlikely to
result in major difficulties for market participants because alternative
benchmarks are easy to envision. For example, in European bond markets,
swaps are already the most common benchmark. Even in the United States, the
Treasury bill market has lost its "benchmark status" in recent years, and
has been replaced in that role by the eurodollar and eurodollar futures
markets, with no evident adverse effects on the operation of short-term
credit markets.  All of these alternative assets, of course, involve some
degree of credit risk . However, given sufficient demand, it seems likely to
me that you or your colleagues could produce a nearly riskless security.

For example, this could be accomplished with a very senior tranche of a
collateralized
debt obligation backed by high-grade corporate debt.  In short, I am
confident that U.S. financial markets, which are the most innovative and
efficient in the world, can readily adapt to a paydown of Treasury debt by
creating private alternatives with many of the attributes that market
participants value in Treasury securities. Of course, the resulting
adjustments will not be perfect and, in some cases, will impose costs on
financial market participants, especially during the period of transition to
new products and procedures.

However, I believe that these costs are very likely to be outweighed by the
benefits to the
country of a higher capital stock and the resulting increases in
productivity and income that appear to be the consequence of debt reduction.
Moreover, competitive pressures and profit opportunities will provide a
strong incentive for you and your colleagues in the financial industry to
devise ways to minimize such costs.

Still, the lack of Treasury securities might be a bigger problem for
international investors than for domestic investors, because they may be
less well informed about U.S. corporations. As a result, international
investors--especially official ones--may have a strong preference for U.S.
government instruments. In such circumstances, foreign investors may reduce,
on net, their holdings of overall dollar assets as Treasury securities are
paid down. By itself, such diminution in the demand for U.S. dollar assets
would tend to raise interest rates for U.S. borrowers and, conceivably, put
downward pressure on the dollar's exchange rate.

However, the evidence of the past year and a half gives little support to
this notion: Foreign private investors, on net, have run off their holdings
of U.S. Treasury securities, while they have built up their holdings of
private dollar assets by an even larger amount, and the foreign exchange
value of the dollar has appreciated.

A final valuable feature of the Treasury market is that it is a remarkably
efficient system for funding federal government deficits.  Because
demographic and other factors are surely likely to lead to the re-emergence
of deficits in the future, one might argue that it would be best to continue
to borrow at least limited amounts from time to time in order to keep the
market operating, so that it will be available when it is needed again.
While that is clearly an alternative, we should also keep in mind that
re-establishing the Treasury security market likely would not be all that
difficult. Borrowing needs, in all likelihood, would start out small, so the
market would have time to develop.

Moreover, I have great confidence in your ability--or that of your
successors--to initiate a new market for Treasury debt when that becomes
necessary.  Like other financial market participants, the Federal Reserve
will also have to adjust to the loss of Treasury debt. Currently, Treasury
securities are the "permanent" assets that correspond to the currency that
is the Federal Reserve's main liability. Treasury securities have several
features that make them particularly attractive assets for the Federal
Reserve. First, the liquidity of the market allows the Federal Reserve to
make substantial changes in reserves in a short period of time, if
necessary. Second, the size of the market has meant that the effects of the
Federal Reserve's purchases on the prices of Treasury securities have been
minimal. Third, Treasury securities are free of credit risk . Thus, the
Federal Reserve does not itself take on such risk when it holds them. I
should point out that we do not eschew risk because we fear becoming
insolvent.

Rather, we believe that the effects of Federal Reserve operations on the
allocation of private capital are likely to be minimized when Federal
Reserve intermediation involves primarily the substitution in the public's
portfolio of one type of instrument that is free of credit risk
--currency--for another-Treasury securities. As I discussed earlier, it is
important that government holdings of assets not distort the private
allocation of capital, and this goal applies to the Federal Reserve System
as well as to the Treasury.

However, if the Treasury debt is paid down, as I trust it will be, then the
Federal Reserve will have to find alternative assets that still provide
substantial liquidity and minimize distortions to the private allocation of
capital. Even before that time, the Treasury market may become less liquid,
making it more difficult for the Fed to make purchases without affecting
market prices. Moreover, declining Treasury debt presumably would, at some
point, reduce the liquidity of the Treasury repurchase agreement (RP)
market,  complicating the use of such operations in adjusting the short-term
supply of reserves.

In the short run, the Federal Reserve will continue to purchase a
substantial volume of Treasury securities. In order to minimize the effects
of its purchases on the market, however, it has established limits on the
fraction of individual issues that it will hold going forward. The Federal
Open Market Committee (FOMC), as you know, has also decided, on a temporary
basis, to allow the Open Market Desk at the Federal Reserve Bank of New York
to conduct RP operations with agency mortgage-backed securities as
collateral as well as with Treasuries and direct agency debt.

Other changes that are already allowed under current statutes could be
implemented to substitute, to a limited extent, for our holdings of Treasury
securities. For example, the Federal Reserve could purchase, outright,
Ginnie Mae securities, which are fully backed by the Treasury.  It could
also further broaden the types of collateral allowed for RP operations,
perhaps including certain municipal obligations or those of foreign
governments. Such an expansion could reduce the effects of Federal Reserve
operations in the market for any particular type of collateral.

The FOMC has asked staff to explore all of these short-run alternatives.
Over a longer time horizon, more fundamental changes could be considered.
One possibility is to expand the use of the discount window by auctioning
such credit to financially sound depository institutions. Such auctions
would enhance our ability to adjust the supply of reserves as needed, and
because these loans would be fully collateralized, they would offer
considerable protection against credit risk.

Another possibility is to add new assets to those the Fed is currently
allowed by law to buy for its portfolio. These assets could be used to
provide a broader range of RP  collateral, a process similar in concept to
the expanded use of the discount window, as well as ultimately being added
to our permanent portfolio. One would hope that such additions would help to
limit the distortions to particular markets caused by Federal Reserve
purchases.

Of course, what adjustments we make to our procedures--and when we make
them--depend on how rapidly the supply of Treasury securities dwindles and
on how long the Treasury market is not available. As I noted earlier,
demographic forces are likely to cause unified budget deficits to re-emerge
at some point in the future and fresh supplies of Treasury securities to be
issued. At that time, the Federal Reserve presumably would begin to shift
our portfolio back toward the Treasury market.

The timing and extent of the re-emergence of Treasury issuance will depend
on underlying productivity growth and, of course, on the degree of fiscal
discipline exercised by future American governments.  Finally, in the period
ahead, the Federal Reserve will be seeking active consultations and
discussions with you and other market participants, as well as with the
Congress, before significant changes are made to Federal Reserve procedures
and methods. While the prospective paydown of Treasury debt presents us with
challenges, I am confident that, with your help, the Federal Reserve can
make the needed adjustments and will be able to continue to implement
monetary policy in the national interest.

The benefits of reducing our federal debt make the associated challenges
well worth meeting."
Enron Offers Structured Weather Note
Derivatives Week - April 30, 2001

Enron is offering via its Internet trading platform a structured weather
note that gives investors financial exposure to the weather in 19 U.S.
cities. Mark Tawney, Enron's Houston-based head of weather derivatives who
was in London last week, said the note mirrors the weather risk element of
the Kelvin weather bond Koch Energy Trading issued in November 1999. Tawney
believes that by guaranteeing to make a secondary market in the note, more
pension funds, hedge funds and mutual funds will invest in weather
derivatives. The note is most likely to be traded by bond holders, Axia (the
product of a merger between Koch Energy Trading and Entergy Trading and
Marketing) and speculative accounts. A weather derivatives official at Axia
declined comment.

Although the timing was not influenced by the downturn in equity markets,
Tawney said investor appetite for instruments with low correlation to the
equity markets should boost demand for the product.

Scott Marra
Administrator for Policy & Media Relations
ISDA
600 Fifth Avenue
Rockefeller Center - 27th floor
New York, NY 10020
Phone: (212) 332-2578
Fax: (212) 332-1212
Email: smarra@isda.org


Chris;
Send this bill to Raquel Magana at 600 Jefferson.  She will forward it onto
Ronnie Shields in our Conn. office for payment.

Ronnie;
Please have someone look at the CES purchase agreement to see how these
should be handled.  I would assume that at a minimum, they would pay, 7/12ths
of the bill since the deal was consummated on July 31.  There may be
provisions where they bear all the taxes.

Chris Germany@ECT
01/04/2001 03:23 PM
To: Jeffrey Porter/HOU/EES@EES, Dave Scott/HOU/EES@EES, Timothy L
Ray/HOU/EES@EES
cc: Scott Goodell/Corp/Enron@ENRON, Robert Tilotta/Corp/Enron@ENRON
Subject: Taxes

I have a tax bill to Columbia Energy Services in the amount of $5,606.78 for
gas stored at the Bear Creek Storage facility.  The amount is $5,606.78 and
it is for the the 2000 tax year.  I was notified about this yesterday and I
think it was due on 12/31/2000.

How do you want to handle this?  I was going to pay it and bill New Power for
the whole amount.  I will also have our tax department fax a copy to Jeff.

Robert, please fax a copy of the letter from Jimmie Smith and the CES tax
bill to Jeff Porter at 713-646-3499.

Thanks


The attached memo gives an overview of a recent FCC decision and its impact
on special access and transport pricing for EBS in SBC and Verizon regions.
Please forward to anyone else who may be interested.  I can be reached at
x-60360 if you have any questions or follow up.  Thanks, Scott


not yet...

I think Webb and I will need to schedule a game (which will be difficult).
After that, it looks like we would play the aggies this weekend or next.

It is uncertain if AC will be party these games.


I apologize for the previous information.  The Paul family has advised me
that:

The mass for Kathy starts at 10:00 AM not 11:00 AM.

Mary G. Strickland


Some South East Power infomation
-----Original Message-----
From: Malowney, John
Sent: Thursday, September 27, 2001 11:46 AM
To: Swerzbin, Mike
Subject: FW: FYI L-P

-----Original Message-----
From: Roger Dieringer [mailto:Roger.Dieringer@lpcorp.com]
Sent: Thursday, September 27, 2001 11:42 AM
To: Malowney, John
Subject: FYI

Industry notes on curtailments and closures

RandomLengths
09/27/2001

Plywood/OSB

Advanced Wood Resources, Brownsville, Ore., will cease all operations as of November 20. "Severe competition from the lower-priced OSB, combined with challenging economic conditions and rising costs associated with increased environmental standards," were cited as reasons for the closure.

Georgia-Pacific has announced plans to shut down nine plywood mills in the South for one week starting October 1 to replenish log supplies.

Hunt Forest Products will shut down its plywood mill in Natalbany, La., for one week starting October 1 due to tight log supplies.

LP has announced market-related downtime at most of its U.S. and Canadian OSB mills. Most of the mills will be down a minimum of one week, starting October 8. Plants in Sagola, Mich., and Jasper, Texas, will be down the week of October 1. Hayward, Wis., will be down the week of October 15. Carthage, Texas, will be down the week of September 24. And Silsbee, Texas, will be down the week of October 8 and for four to six weeks thereafter for a press rebuild.

Willamette Industries' plywood mill in Dodson, La., will shut down the week of September 24 for scheduled maintenance.

LUMBER

Harwood Products, Branscomb, Calif., has cut production by 20% due to market conditions

Weyerhaeuser will close its three Cedar sawmills in British Columbia for an indefinite duration beginning next week. Market conditions were cited.

Canadian Forest Products will reduce output at its sawmills in British Columbia and Alberta by an estimated 70 million board feet during October.

Abitibi Consolidated plans to cut production by about 25% at all of its sawmills over the next four weeks. "Market conditions and supplemental export costs" were cited as reasons for the curtailments.

Slocan Forest Products will reduce production by 30 million board feet by curtailing production the first week of October

For more information, visit RandomLengths <http://www.randomlengths.com/>

Roger Dieringer
Corporate Supply Manager - Energy
936.788.9759  Phone
936.524.0609  Cellular Phone
888.710-0640  Pager


Jeff,

We shall forward to you shortly a copy of the message from Sandeep with the
numbers you have
requested.  What follows below are the extracts from two recent articles on
the power situation in India
published by The Financial Times.

The first article describes recent power outage in northern India affecting
millions of people.
One possible line of defense is pointing out to the value of  output lost due
to  power
shortages. It is obvious that the value of lost production exceeds the cost
of power produced
by the Dhabol plant (expensive as it may be). The power cut affected 230
million people.

The second article is Enron specific.

Vince

                     ASIA-PACIFIC: Power failure hits north India
                     Financial Times; Jan 3, 2001
                     By ANGUS DONALD

                     Tens of millions of people were left without electricity
in northern India
                     yesterday after a power grid breakdown.

                     Electricity was gradually switched on in some areas and
most parts of the
                     capital New Delhi, with 60 to 70 per cent of supply
expected to be restored
                     by the end of the day, according to power grid
officials.

                     The Associated Chambers of Commerce and Industry
(Assocham), a
                     leading business organisation, expressed "deep concern"
and called for a
                     mechanism to prevent future disruption that could
"cripple the economy".

                     The power failure across eight Indian states, including
New Delhi, disrupted
                     train services, water supplies and the telephone network
and forced
                     hospitals to switch to emergency generators.

                     The fault occurred on the Northern Grid, which provides
electricity for 226m
                     people, and affected the states of Delhi, Haryana,
Punjab, Uttar Pradesh,
                     Himachal Pradesh, Madhya Pradesh, Rajasthan and Jammu
and Kashmir.

                     A breakdown at a sub-station in Kanpur in Uttar Pradesh,
India's most
                     populous state, caused an overload of power on other
lines, which then
                     failed as well.

                     Trains stopped running for most of the day and signals
systems were
                     damaged. New Delhi international airport was also
slightly affected before
                     its own power supply could be engaged.

                     "We will probe into the reasons for the failure. It is
most likely to be a
                     technical failure, but we will investigate why it
happened," Suresh Prabhu,
                     the power minister, was quoted as saying by Press Trust
of India.

                     India suffers regularly from power problems because of
lack of funding to
                     upgrade infrastructure. Theft of supplies is also a big
problem. Thirty per
                     cent of the country's electricity is stolen, according
to analysts. In New
                     Delhi as much as 50 per cent is stolen.

                     Two years ago, a power failure blacked out Uttar Pradesh
and Delhi for
                     hours.

                     Assocham issued a statement, saying that increasing
industrial demand
                     would exacerbate the problems already faced by India's
inefficient power
                     sector. "The slow progress, particularly in
strengthening the transmission
                     and distribution system, and ever increasing theft will
contribute to
                     worsening the power supply situation further."

                     Copyright: The Financial Times Limited

  , Copyright The Financial Times Limited 2000. "FT" and "Financial Times"
are trademarks of The Financial Times. Privacy Policy | Terms & Conditions.

******************************************************************************
*************************************

                     ASIA-PACIFIC: Energy group launches image offensive:
Enron has a
                     plan to reverse its reputation as a profiteering
multinational
                     operating in India, writes Khozem Merchant

                     Financial Times; Jan 3, 2001
                     By KHOZEM MERCHANT

                     Enron, the US energy producer and a constant target of
criticism in India, is
                     hitting back with a campaign to reverse its image as a
profiteering
                     multinational.

                     Its "myth and reality" offensive in local newspapers
follows the west Indian
                     state of Maharashtra's decision to review the tariff it
pays the Texas-based
                     company, whose Dollars 2.2bn electricity generating
plant at Dabhol is
                     India's biggest single foreign investment.

                     Maharashtra's tariff has more than doubled since 1993
and is three times
                     greater than that charged by other independent power
producers (IPPs).
                     The tariff has risen because of the depreciation of the
rupee against the
                     dollar and the high but now falling price of naphtha
fuel. The state also pays
                     a fixed capacity charge of Rs970m (Dollars 21m) a month,
reflecting the
                     huge project cost and, controversially, irrespective of
consumption.

                     A showdown looks inevitable, reminiscent of a clash six
years ago that
                     damaged India's appeal to foreign investors. A former
official of the World
                     Bank, which has criticised the deal, says Enron is
emerging "as the East
                     India Company of the 21st century" - a reference to the
British trader that
                     colonised key areas of the Indian economy in the 19th
century.

                     The stand-off is the latest blot on India's power
sector. The UK's PowerGen
                     and Cogentrix of the US have quit India recently,
frustrated by long approval
                     procedures, inadequate payments mechanisms or because of
higher
                     returns elsewhere.

                     "India has lost time and opportunity and has driven
returns down by six
                     percentage points," says Gerry Grove-White, former India
general manager
                     of PowerGen, which has sold its 655MW plant in Gujarat
to China Light &
                     Power of Hong Kong.

                     India's national plan for the five years to 2002 says
generating capacity
                     must rise by 40,000MW to about 120,000MW. But since
1992, IPPs have
                     added only 3,000MW and 2,500MW remains under
construction. This is
                     insufficient to support official projections of 6 to 8
per cent economic
                     growth.

                     Enron was a bellwether of India's liberalisation,
winning fast-track project
                     approval in the early 1990s. Phase 1, a 740MW plant
fuelled by expensive
                     naphtha came on stream in May 1999, and phase 2, a
Dollars 1.87bn plant
                     of 1,624MW capacity that will run on cheaper liquefied
natural gas (LNG),
                     will be completed this year. Only two of seven other
fast-track proposals
                     have achieved financial closure.

                     From the outset Enron encountered attacks, culminating
in Maharashtra's
                     then nationalist government cancelling the project
before renegotiating
                     terms no less onerous. Vilasrao Deshmukh, chief minister
of the successor
                     government, says the power purchase agreement is
unaffordable.

                     Enron, whose attackers also include cultural
chauvinists, wants to maintain
                     good political relations in a hostile but lucrative
environment. Enron views
                     India as a testing ground for its evolution from a
traditional manager of
                     power plants to a broad-based trader of commodities,
such as energy, gas
                     and bandwidth.

                     To support these ambitions Enron hopes to trade energy
between power
                     surplus and deficit states, once legislation is passed
this year. It is building
                     an LNG terminal and pipelines to trade imported natural
gas. And it is
                     laying a 15,000km fibre-optic network to trade bandwidth
space in a country
                     desperately short of this new economy commodity.

                     In any event, Enron believes it has a watertight
contract. It is supported by
                     many that believe any subversion of the contract would
confirm investor
                     perception of Maharashtra, India's financial and
industrial hub, as an
                     unreliable destination for investment.

                     Mr Deshmukh - who has avoided the language of his
predecessor, which
                     threatened to "dump Dabhol into the Arabian Sea" - is
under pressure from
                     radical members of his wobbly coalition. But his options
are limited.
                     Scrapping the project would be ruinous for an
economically troubled state
                     that would have to compensate shareholders.

                     Maharashtra State Electricity Board, the local utility
and Enron's main
                     client, is obliged to dispatch or "off-take" 90 per cent
of Dabhol's output. Yet
                     MSEB has never honoured these guarantees. Its off-take
has averaged 60
                     per cent since the plant opened and, in effect, MSEB has
been paying a lot
                     more while consuming a lot less power.

                     One reason off-take is low is because the state's tough
new regulator has
                     told MSEB to buy from cheaper sources. Enron says the
tariff would be
                     Rs4.02/kWh if MSEB's off-take averaged 90 per cent. But
with off-take a
                     third lower, the average tariff is Rs4.94 per unit, and
often higher. In
                     October, the tariff was Rs6.91 per unit, when off-take
was about 49 per
                     cent. Enron says tariffs should come down when phase 2,
run on cheaper
                     LNG, starts.

                     These cost pressures have forced MSEB to take up only
half of a 30 per
                     cent equity option in phase 2. Enron has acquired the
balance and
                     mandated bankers to find a buyer.

                     Enron's difficulties have undermined the appeal of IPPs,
which have failed to
                     deliver the flood of investments. Potential IPPs feared
they would never be
                     paid by state generating boards that have become a
byword for corrupt
                     management of power.

                     Reform of state electricity boards, whose uneconomic
pricing means
                     industrial users subsidise poor farmers, as well as
transmission and
                     distribution (T&D) services to check huge theft and
technical losses, is
                     overdue. "Given the limited resources, money would be
better spent on T&D
                     rather than on new plant," says Oliver Blackaby,
managing director of N M
                     Rothschild in India, which is advising Karnataka on the
privatisation of its
                     distribution network.

                     For the moment, attention is fixed on Enron's ability to
satisfy the
                     competing interests of investors and clients. As Sanjay
Bhatnagar, chief
                     executive officer of Enron India, said in a recent trade
magazine, one of the
                     key lessons learned from phase 2 is "having flexibility
to deal with
                     externalities".

                     Copyright: The Financial Times Limited

  , Copyright The Financial Times Limited 2000. "FT" and "Financial Times"
are trademarks of The Financial Times. Privacy Policy | Terms & Conditions.


John,

We have discussed i2 in the past  but we need to take some action steps to
make decisions and move forward.  Here is what I want to see done in short
order.

Meeting with all key technologist on the full suite of products and
functionality with complete demonstration by i2.  I would especially want PB,
JP, BP, HE, and JG from George's group.
Follow-up meeting (after the technologists see functionality and form
opinions and possible applications) with key commercial leaders:  GP -  P&P;
TG - CommodityLogic; BG - Metals and steel;  JF - New Markets and
Investments; AS - New Markets and Bus Dev.  During that meeting, we need to
have some real players with i2 there to brainstorm and discuss business
expansion opportunities in the specific verticals.  It would be good to
actually have this meeting in Dallas but I am concerned about attendance.  i2
owns the process and supply/downstream management in these industries and we
need to really look to see if our combination can accelerate our new efforts
and solve any logistic issues.
Put together an action plan.  George's group has already put a presentation
together about i2, the products and possible applications.  George, please
sent that to John.  I would like that document to be our updated business
plan for i2 to be used as a "living" document as we move forward.
Assign someone to make and co-ordinate the use and full deployment of those
products (utilize our $10 million spend).  I want someone to have the
responsibility for i2 and he or she can also work with EBS on what they are
doing also.  To be clear, we have spent the $10 million already but are not
using the products.  I want to deploy all (if possible) and make this
investment fully utilized.  I do understand that we don't drive businesses
around a pre-purchased product but we should look at is as a sunk cost and
rationalize why we shouldn't use if rather that simply considering it as an
option.
Jason Robert, (469) 357-6737, was at the dinner with Sanjiv, Greg Brady, Jeff
and Greg and he knows some of the mutual objectives.  He would be the guy to
work with and set it all up.
EBS should be involved as well.  Rex Shelby is spending a lot of time with
i2, weekly visits, and should also participate and use their products as well.
Is there an application for all of EES and their business?
Remember, Ken Lay is considering joining their board and we should be able to
give him very clear insight on their products and how their company works.
PB, if you want someone outside Pavetto's group  to work on this that is fine
but i want to understand the background and how they will make this happen.

Thanks and please let me know your initial thoughts and timing.  If you need
to have me send out an email to make sure that everyone understands the
priority, please draft up and I'll send out.

Mike


You have been invited to partake in the Real Time Appreciation Party.
It will take place THIS Friday 11/30, 7pm-12am at the McMenamins Edgefield
(Power Station - Annex).  Food and Beverages will be served.

You can find more details for this party in your mail
slot where your invitation is waiting.  Directions on back
of invite.

If you have any questions regarding details please feel free to e-mail me.

Thank you,
Jill


Harry --

Can you track down this bill and determine impact?  We'll discuss on Thursday.

Jim
---------------------- Forwarded by James D Steffes/NA/Enron on 07/17/2001 07:43 AM ---------------------------

MDay <MDay@GMSSR.com> on 07/16/2001 06:03:33 PM
To:	"'Bev Hansen, Enron lobbyist'" <bhansen@lhom.com>, "'Hedy Govenar, Enron Sacto lobbyist'" <hgovenar@govadv.com>, "'Scott Govenar, Enron lobbyist'" <sgovenar@govadv.com>, "'Harry Kingerski'" <hkingers@enron.com>, "'Jim Steffes, Enron'" <jsteffe@enron.com>
cc:

Subject:	AB 23XX   Bad Bill Alert

Is AB 23XX moving with a chance of passage?   I just learned that this
Pescetti bill that was AB 1425 was revived as a 2X bill.  It is very
anti-competitive, and could hurt a number of TW, EES, or ENA gas deals by
binding customers to 100% utility service through the imposition of large
exit fees by the CPUC.  If there is a chance that it moves, we need to
discuss the effect of this bill.  Mike Day

http://info.sen.ca.gov/pub/bill/asm/ab_0001-0050/abx2_23_bill_20010625_amend
ed_sen.pdf


11:00 Classes will be postponed until further notice.

Thanks!


The Forum II meeting will take place at 6:00 p.m. on Monday, December 4, at
Vin-De-Garde, located at 3311 Sul Ross (check link below for map).

http://maps.yahoo.com/py/maps.py?BFCat=&Pyt=Tmap&newFL=Use+Address+Below&addr=
3311+Sul+Ross&csz=Houston%2C+TX&country=us&Get%A0Map=Get+Map

Please indicate your attendance below and return to me via e-mail
(sherri.sera@enron.com):

I will attend ___

I will not attend ___

Additionally, a number of requests have been made to change the date of the
March 2001 Forum II meeting (currently scheduled to take place on Monday,
March 19).  Please indicate your availability on the following dates:

Monday, March 12 Yes ___ No ___
Thursday, March 15  Yes ___ No ___
Monday, March 26 Yes ___ No ___
Tuesday, March 27 Yes ___ No ___
Thursday, March 29 Yes ___ No ___


Jacoby's assistant just called and wanted your home address.  Apparently Ben
is going to send you something or someone (manicurist/pedicurist) to your
home.  I told her you liked champagne too if he wanted to get you a beverage
and also that you would be leaving to go celebrate your daughter's birthday a
little later this afternoon.  I didn't want them sending out someone and you
not be there.  I can see you now with the phone in one hand and a manicurist
on the other or better yet, a glass of bubbly!


You have received this email because you are listed as a security approver.
Please click
http://itcapps.corp.enron.com/srrs/auth/emailLink.asp?ID=000000000009797&Page=
Approval to review and act upon this request.

Request ID          : 000000000009797
Request Create Date : 12/11/00 9:39:04 AM
Requested For       : diana.andel@enron.com
Resource Name       : EOL Canada Backoffice Data Manager
Resource Type       : Applications


BREAKING NEWS from CNN.com

-- Hospital sources report deaths in blast on crowded Tel Aviv beach, CNN confirms. Details soon.

For complete coverage of this story visit:
http://www.CNN.com

========================================================
To UNSUBSCRIBE or SUBSCRIBE to any CNN E-MAIL service visit:
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CNN Interactive email id:18915171102133862


Richard, thanks for taking the time to network with me.  I have attached
information about my Partner Lynn Brondos and me; Also, please find a
position description.

 <<Product Risk Managment.doc>>

Francisco Rivera, CPC

RWS PERSONNEL, INC.
Power Industry Executive Search
700 Ackerman Rd, Suite 390
Columbus, OH 43215
tele 614.358.1594
francisco@powerindustrysearch.com


Rex, I will ask him to include you on the list. Jim

 -----Original Message-----
From: 	Rogers, Rex
Sent:	Friday, June 08, 2001 4:35 PM
To:	Derrick Jr., James
Subject:	RE: Status of EWS Litigation

Jim:  Thanks for forwarding this to me---this helps me with our ongoing (seemingly daily!) disclosure issues.  Considering the confidential nature of these litigation memos, and the fact that Andy probably doesn't know who the heck I am(and probably doesn't care!), would you ask him to include me on his distribution list?  I think he will be more comfortable getting the request from you.  Thanks, Rex.

 -----Original Message-----
From: 	Derrick Jr., James
Sent:	Friday, June 08, 2001 11:02 AM
To:	Rogers, Rex
Subject:	FW: Status of EWS Litigation

FYI

 -----Original Message-----
From: 	Edison, Andrew
Sent:	Friday, June 08, 2001 10:58 AM
To:	Derrick Jr., James
Cc:	Haedicke, Mark; Murray, Julia; Frevert, Mark; Sanders, Richard; Lavorato, John
Subject:	Status of EWS Litigation

Jim -

I have attached a June 8, 2001 memorandum detailing the status of EWS litigation.  Per your request, this memorandum will be provided to you on a weekly basis.  Changes from the previous week will be in bold.

Thanks.

Andy

 << File: EWS Litigation Weekly Report 2001.doc >>


Becky --

What's the upside and downside from the Settlement.  My only concern is that FERC is so swamped with issues may be overwhelming.  Where is our business going?

Jim
 -----Original Message-----
From: 	Cantrell, Rebecca W.
Sent:	Monday, August 13, 2001 5:25 PM
To:	Lawner, Leslie; Tholt, Jane M.; Miller, Stephanie; Tycholiz, Barry; Grigsby, Mike
Cc:	Steffes, James D.; Nicolay, Christi L.; Novosel, Sarah
Subject:	FW: Motion To Convene Settlement Conference

FYI.  Obviously, we would want to participate in any settlement discussions.  Do you see any reason why we would not want to support the motion to establish the settlement procedure?  SRP indicates that the ongoing proceedings would not be delayed.

 -----Original Message-----
From: 	Joel Greene <jlgreene@energyadvocates.com <mailto:jlgreene@energyadvocates.com>>@ENRON [mailto:IMCEANOTES-Joel+20Greene+20+3Cjlgreene+40energyadvocates+2Ecom+3E+40ENRON@ENRON.com] <mailto:[mailto:IMCEANOTES-Joel+20Greene+20+3Cjlgreene+40energyadvocates+2Ecom+3E+40ENRON@ENRON.com]>
Sent:	Monday, August 13, 2001 4:28 PM
To:	agold@coral-energy.com <mailto:agold@coral-energy.com>; amy.sheridan@williams.com <mailto:amy.sheridan@williams.com>; barryp@bp.com <mailto:barryp@bp.com>; bbrigham@sidrichgas.com <mailto:bbrigham@sidrichgas.com>; bealljp@texaco.com <mailto:bealljp@texaco.com>; bgray@cc.state.az.us <mailto:bgray@cc.state.az.us>; Bgray@EPElectric.com <mailto:Bgray@EPElectric.com>; bjost@huberlaw.com <mailto:bjost@huberlaw.com>; bruce.a.connell@usa.conoco.com <mailto:bruce.a.connell@usa.conoco.com>; bwhitta@pnm.com <mailto:bwhitta@pnm.com>; carla.j.johnson@usa.conoco.com <mailto:carla.j.johnson@usa.conoco.com>; carpentierd@dsmo.com <mailto:carpentierd@dsmo.com>; caschindler@hhlaw.com <mailto:caschindler@hhlaw.com>; catherine.palazzari@elpaso.com <mailto:catherine.palazzari@elpaso.com>; cbrechte@apsc.com <mailto:cbrechte@apsc.com>; cbulf@oneok.com <mailto:cbulf@oneok.com>; coganja@aol.com <mailto:coganja@aol.com>; craigc@calpine.com <mailto:craigc@calpine.com>; cynthiacorcoran@corcoran-law.com <mailto:cynthiacorcoran@corcoran-law.com>; daniel.collins@elpaso.com <mailto:daniel.collins@elpaso.com>; daswanstrom@verner.com <mailto:daswanstrom@verner.com>; Dave Huard Esq. (E-mail) (E-mail); dbmcvick@srpnet.com <mailto:dbmcvick@srpnet.com>; dfulton@enron.com <mailto:dfulton@enron.com>; dga@sloverandloftus.com <mailto:dga@sloverandloftus.com>; djohn@jhenergy.com <mailto:djohn@jhenergy.com>; dkirkla@pnm.com <mailto:dkirkla@pnm.com>; dlh@jmbm.com <mailto:dlh@jmbm.com>; dlsmith@pplweb.com <mailto:dlsmith@pplweb.com>; dmcwash@mshpc.com <mailto:dmcwash@mshpc.com>; douglas.porter@sce.com <mailto:douglas.porter@sce.com>; dtom@btuwatch.com <mailto:dtom@btuwatch.com>; Dwilliams@kmg.com <mailto:Dwilliams@kmg.com>; earo@dynegy.com <mailto:earo@dynegy.com>; edward.mcmurtrie@swgas.com <mailto:edward.mcmurtrie@swgas.com>; elizabeth.herdes@elpaso.com <mailto:elizabeth.herdes@elpaso.com>; emyerskerbal@shb.com <mailto:emyerskerbal@shb.com>; Fritz Kolb (E-mail); frl3@pge.com <mailto:frl3@pge.com>; gbaker@sempra.com <mailto:gbaker@sempra.com>; gcvenz@duke-energy.com <mailto:gcvenz@duke-energy.com>; gduede@apsc.com <mailto:gduede@apsc.com>; glander@skippingstone.com <mailto:glander@skippingstone.com>; gsmith@jhenergy.com <mailto:gsmith@jhenergy.com>; haorndorff@aeraenergy.com <mailto:haorndorff@aeraenergy.com>; jab@cpuc.ca.gov <mailto:jab@cpuc.ca.gov>; jalward@cc.state.az.us <mailto:jalward@cc.state.az.us>; james.trifon@southernenergy.com <mailto:james.trifon@southernenergy.com>; Tholt, Jane M.; jay.golub@bakerbotts.com <mailto:jay.golub@bakerbotts.com>; jcashin@epsa.org <mailto:jcashin@epsa.org>; jdoering@rcgroup.com <mailto:jdoering@rcgroup.com>; jeff.goforth@williams.com <mailto:jeff.goforth@williams.com>; jerry.strange@elpaso.com <mailto:jerry.strange@elpaso.com>; jgregg@mbolaw.com <mailto:jgregg@mbolaw.com>; jhmcgrew@brudergentile.com <mailto:jhmcgrew@brudergentile.com>; jima@pandaenergy.com <mailto:jima@pandaenergy.com>; jmoriarty@fw-law.com <mailto:jmoriarty@fw-law.com>; Joel Greene; Joseph Koury (E-mail); jpa3@pge.com <mailto:jpa3@pge.com>; jparker@govmail.state.nv.us <mailto:jparker@govmail.state.nv.us>; jpfloom@gkrse-law.com <mailto:jpfloom@gkrse-law.com>; jpnevins@hhlaw.com <mailto:jpnevins@hhlaw.com>; jrlilyestrom@hhlaw.com <mailto:jrlilyestrom@hhlaw.com>; jrogers@btuwatch.com <mailto:jrogers@btuwatch.com>; jstaffier@sdsatty.com <mailto:jstaffier@sdsatty.com>; jsuwara@sempra.com <mailto:jsuwara@sempra.com>; judy.heineman@elpaso.com <mailto:judy.heineman@elpaso.com>; kadaly@moheck.com <mailto:kadaly@moheck.com>; kaprice@srpnet.com <mailto:kaprice@srpnet.com>; karilee.ramaley@pinnaclewest.com <mailto:karilee.ramaley@pinnaclewest.com>; kathleen.royal@elpaso.com <mailto:kathleen.royal@elpaso.com>; kbedwards@gkrse-law.com <mailto:kbedwards@gkrse-law.com>; kbosley@reliant.com <mailto:kbosley@reliant.com>; kclark@jhenergy.com <mailto:kclark@jhenergy.com>; kkrieger@columbiaenergygroup.com <mailto:kkrieger@columbiaenergygroup.com>; klm@dwgp.com <mailto:klm@dwgp.com>; larry.black@swgas.com <mailto:larry.black@swgas.com>; lhamilto@utilicorp.com <mailto:lhamilto@utilicorp.com>; lindseyhowdowning@dwt.com <mailto:lindseyhowdowning@dwt.com>; lpadilla@gas.pemex.com <mailto:lpadilla@gas.pemex.com>; lwsmith@midcogen.com <mailto:lwsmith@midcogen.com>; mark.cook@elpaso.com <mailto:mark.cook@elpaso.com>; mark.minich@elpaso.com <mailto:mark.minich@elpaso.com>; mcregar@aeglobalmarkets.com <mailto:mcregar@aeglobalmarkets.com>; melissa.maxwell@bakerbotts.com <mailto:melissa.maxwell@bakerbotts.com>; mfenton@pnm.com <mailto:mfenton@pnm.com>; Michael McElrath (E-mail); mike.langston@southernunionco.com <mailto:mike.langston@southernunionco.com>; millertr@bp.com <mailto:millertr@bp.com>; mmexal@giant.com <mailto:mmexal@giant.com>; napedersen@jonesday.com <mailto:napedersen@jonesday.com>; Norm Walker; Pat Anderson (E-mail); patricia.shelton@elpaso.com <mailto:patricia.shelton@elpaso.com>; paul.gendron@neg.pge.com <mailto:paul.gendron@neg.pge.com>; pcervin@br-inc.com <mailto:pcervin@br-inc.com>; pckissel@gkrse-law.com <mailto:pckissel@gkrse-law.com>; pete.frost@usa.conoco.com <mailto:pete.frost@usa.conoco.com>; pkeeler@br-inc.com <mailto:pkeeler@br-inc.com>; pmohler@hewm.com <mailto:pmohler@hewm.com>; pserrano@epelectric.com <mailto:pserrano@epelectric.com>; racosta@epelectric.com <mailto:racosta@epelectric.com>; rcashdollar@apachenitro.com <mailto:rcashdollar@apachenitro.com>; Cantrell, Rebecca W.; redavis@sempra.com <mailto:redavis@sempra.com>; rhewlett@aepnet.org <mailto:rhewlett@aepnet.org>; richard.derryberry@elpaso.com <mailto:richard.derryberry@elpaso.com>; robert.tomlinson@elpaso.com <mailto:robert.tomlinson@elpaso.com>; rosa.jackson@elpaso.com <mailto:rosa.jackson@elpaso.com>; rpetti@ladwp.com <mailto:rpetti@ladwp.com>; rrich@bracepatt.com <mailto:rrich@bracepatt.com>; salleyoo@dwt.com <mailto:salleyoo@dwt.com>; sally.turley@elpaso.com <mailto:sally.turley@elpaso.com>; sandrar@prestongates.com <mailto:sandrar@prestongates.com>; sarah.tomalty@dynegy.com <mailto:sarah.tomalty@dynegy.com>; sbreen@czn.com <mailto:sbreen@czn.com>; Scott Walton; semertz@aep.com <mailto:semertz@aep.com>; sjf@cpuc.ca.gov <mailto:sjf@cpuc.ca.gov>; sjroyka@columbiaenergygroup.com <mailto:sjroyka@columbiaenergygroup.com>; slevine@brattle.com <mailto:slevine@brattle.com>; Susan Ginsberg; susan.jones@neg.pge.com <mailto:susan.jones@neg.pge.com>; tarpeysp@bp.com <mailto:tarpeysp@bp.com>; tcarlson@apsc.com <mailto:tcarlson@apsc.com>; tcubbage@cov.com <mailto:tcubbage@cov.com>; tdickers@westerngas.com <mailto:tdickers@westerngas.com>; vrspurg@ppco.com <mailto:vrspurg@ppco.com>; william.healy@elpaso.com <mailto:william.healy@elpaso.com>; wlansinger@sempra.com <mailto:wlansinger@sempra.com>
Subject:	Motion To Convene Settlement Conference

Attached is a draft motion of Salt River Project to establish a date certain
for convening a settlement conference under Rule 602, in accordance with the
settlement package distributed on July 30. Paragraph 8 of the motion will
list all parties that are in support of this procedural motion.  A company's
support for the motion IN NO WAY reflects any agreement to support any
setttlement proposal.  It merely indicates a desire to initiate a parallel
settlement path without interfering with or delaying FERC's processing of
the ongoing proceedings. Please reply to all by COB Tuesday in advising
whether your company would like to be listed.  We intend to file on
Wednesday early afternoon.  Thank you.

Energy Advocates LLP
202-371-9889
202-371-9025 (fax)
jlgreene@energyadvocates.com <mailto:jlgreene@energyadvocates.com>
 <<rp00-336setmot1.doc>>

 - rp00-336setmot1.doc << File: rp00-336setmot1.doc >>


Please find attached the credit worksheet for OESC.  Please be advised this is for a draft ISDA and for discussion purposes only as you will see from my credit worksheet that the cross default amount is still to be determined as I did not have access to the company financial statements while I am up here working in Portland.  Please prepare the draft ISDA and forward it onto Paul DeVries and Chris Gaffney for their further handling.

Thank you
Wendy

PS - I will be out on vacation Mon Nov 26 through Wed Nov 28, and then working in the Portland office until Dec 3rd.


Any idea on when I can get your info?

---------------------- Forwarded by Rod Hayslett/FGT/Enron on 12/12/2000
03:20 PM ---------------------------

	From:  Donna Scott                           12/12/2000 03:15 PM

To: Pamela Daily/FGT/Enron@ENRON, Julia White/ET&S/Enron@ENRON
cc: Danny McCarty/ET&S/Enron@Enron, Julie Armstrong/Corp/Enron@ENRON, Ricki
Winters/ET&S/Enron@Enron, Rod Hayslett/FGT/Enron@ENRON, Steven
January/ET&S/Enron@ENRON, Lynn Blair/ET&S/Enron@ENRON, Sheila
Nacey/ET&S/Enron@ENRON, Rick Dietz/ET&S/Enron@ENRON

Subject: Preliminary 2001 Floor Plan

The Market Service Team has reviewed their requirements for the proposed
relocation of ETS within the Enron building.  Under this plan, Gas Control
would not move from their current location and the Market Service Teams would
be in close proximity to Transactional Marketing and Facility Planning.
Julia's intent is to have discussion with Danny to make sure the
organizations are aligned to support the commercial teams.

Please let me know if you have any questions.
Donna


Sounds like you should deny them from Commodity Logic.  Please let them
Commodity Logic team know.

Bill

Jason R Williams@ENRON
01/09/2001 09:10 AM
To: William S Bradford/HOU/ECT@ECT
cc:
Subject: Re: CommodityLogic - Credit Approval Request

Bill -

Southwest Royalties' credit quality is extremely poor:  E-rating of 11,
negative equity, very little liquidity and no bank lines available to them.
We currently have 5 trades on the books with them (all financial) with a
total net position ~$2.6 MM out of the money to Enron.

I would normally not move up the payment for this counterparty, but all of
our trading with them has been limited to selling them financial puts.  As
such, Enron will not incur any exposure to Southwest Royalties, and I feel
that an earlier pay date can be justified from a credit standpoint.

Please let me know if you have any questions.

Jay

	From:  William S Bradford @ ECT                           01/08/2001 01:00 PM

To: Jason R Williams/NA/Enron@ENRON
cc: Debbie R Brackett/HOU/ECT@ECT, Douglas Fuehne/NA/Enron@ENRON

Subject: CommodityLogic - Credit Approval Request

Jay,

Please review Southwest Royalties for our comfort with paying them earlier in
the billing cycle.  Please keep in mind that our payable can be used as an
offset against any MTM exposure.

Let me know.  Thanks,
Bill

---------------------- Forwarded by William S Bradford/HOU/ECT on 01/08/2001
12:01 PM ---------------------------

Andrea Crump@ENRON
01/08/2001 10:29 AM
To: William S Bradford/HOU/ECT@ECT
cc: Debbie R Brackett/HOU/ECT@ECT, Deana Fortine/Corp/Enron@ENRON, Douglas
Fuehne/NA/Enron@ENRON
Subject: CommodityLogic - Credit Approval Request

Hello,

Please review the attached spreadsheet for credit review.  The customer
requesting access to the Financial Management Module is Southwest Realities,
Inc. (CPID - 2912).   Please reply with credit response to complete the
application process.

Deana Fortine will be sending the credit requests from here on forward.
Thank you!

Thank you for your help,
Andrea
Product Control Group - CommodityLogic
x54420


Heather,  Attached is the ash handling agreement with revisions.  Please
review.   I will be forwarding the coal handling agreement shortly.  The
changes should be similar.

Redline of this document will follow.


>Subject: FREE entrance for Club Ibiza on Friday, 10/26/01
>Date: Sat, 20 Oct 2001 23:58:00 -0700
>
>
>Hello everyone! This is DJ Dimitris Mykonos.
>
>Let me start by thanking all of you for showing up at the last Ibiza party on Oct. 5th and making it an incredible success. Over 1200 people partied until 3:00am! For those of you who wrote me thank you letters and expressed interest in my next Ibiza party, here is your chance. Prepare yourself for an even bigger night.
>
>On Friday, October 26th, come and experience Southern European Style as we bring you the sounds and unique mixing methods from Europe's party capitals like Ibiza, Mykonos, Majorka, etc..
>
>We will be blending all types of dance music into one ingenuous mix, choosing the best material of Mainstream Dance, House, Progressive, Techno, Trance, Latin House, Disco, Tribal and Hip-Hop.
>
>DJ Donovan and DJ Tony Russell will get the party going. Around midnight, I will take over and spin till you can't take it anymore.
>
>Free entrance 9:00PM to midnight ONLY WITH GUEST PASS
>
>To get your free guest, send email to dimitrismykonos@home.com and type RSVP in the subject line. Please also specify your full name and the number guests that are coming with you. You will receive a confirmation guest pass email that you will need to print out and present to the cashier.
>
>You're welcome to forward this email to your friends.
>
>Don't forget to reserve a room at the incredible Club Ibiza! For information, call the hotel directly at 510-383-9888 or visit www.hotelibiza.com <http://www.hotelibiza.com/>.
>
>I can't wait to see all of you there.
>
>Keep on dancing,
>
>DJ Dimitris Mykonos
>


we have some wonderful corn tortilla and avies if you want to make yourself
a quesadilla when you get here.  I am home now and signing off of my e-mail
in about 5 minutes.

-----Original Message-----
From: Jeff.Dasovich@enron.com [mailto:Jeff.Dasovich@enron.com]
Sent: Thursday, July 26, 2001 3:28 PM
To: Nancy Sellers
Subject: RE:

oops.

                    Nancy Sellers

                    <Nancy.Sellers@RobertMo        To:
"'Jeff.Dasovich@enron.com'"
                    ndavi.com>                     <Jeff.Dasovich@enron.com>

                                                   cc:

                    07/26/2001 05:16 PM            Subject:     RE:

where are you going to find the other 27 people?  We'll be happy to see you

-----Original Message-----
From: Jeff.Dasovich@enron.com [mailto:Jeff.Dasovich@enron.com]
Sent: Thursday, July 26, 2001 2:08 PM
To: Nancy.Sellers@RobertMondavi.com
Subject:

i'll be back to switch cars later tonite, but too late for dinner---likely
around 8:30.  love to play some 30 handed cribbage!  thanks again for
dinner last nite.  it was dee-licious.

best,
jeff

**********************************************************************
This e-mail is the property of Enron Corp. and/or its relevant affiliate
and
may contain confidential and privileged material for the sole use of the
intended recipient (s). Any review, use, distribution or disclosure by
others is strictly prohibited. If you are not the intended recipient (or
authorized to receive for the recipient), please contact the sender or
reply
to Enron Corp. at enron.messaging.administration@enron.com and delete all
copies of the message. This e-mail (and any attachments hereto) are not
intended to be an offer (or an acceptance) and do not create or evidence a
binding and enforceable contract between Enron Corp. (or any of its
affiliates) and the intended recipient or any other party, and may not be
relied on by anyone as the basis of a contract by estoppel or otherwise.
Thank you.
**********************************************************************


Sara - small typo - the Schedule should read "Amended and Restated as of
March 2, 2001


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thanks  -- given the last 2 days  - we will wait and see

 -----Original Message-----
From: 	Beck, Sally
Sent:	Monday, November 26, 2001 4:23 PM
To:	Apollo, Beth
Subject:	RE: Team building event for my direct reports

Can you hold on this until after mid-week this week?  We haven't gotten much communication from "above" on spending, but everyone is doing the obvious things to be prudent right now.  I can tell you that even over this Thanksgiving weekend (with banks open on Friday), that there is still tremendous concern and focus on cash.  (I got calls at home on Friday afternoon to provide data on EA, EGM and EIM payables - data deemed critical that day).  I know that company-wide, we will want to be certain that the cancellation of the company-wide holiday party does not result in just as much money being spent by hundreds of groups across the company.

If  waiting until after mid-week makes the timing diffcult for planning purposes, I might suggest a less costly version.  One idea is to tell your directs that you want to bring them together as a group to thank them for their hard work and offer your home for the occassion on the 7th.  You could submit for expense reimbursement the cost of something like wine and beer, and ask everyone to bring a snack to contribute to the party.  I think that everyone would understand not having the entire event underwritten by Enron - especially following the events that will occur  this week.  Over the years we have all gotten used to Enron footing the bill for so many things.  At the bank where I was before, we occassionally had get-togethers where we all brought something to the party.  It is not really unusual outside Enron.  --Sally

 -----Original Message-----
From: 	Apollo, Beth
Sent:	Monday, November 26, 2001 10:21 AM
To:	Beck, Sally
Subject:	Team building event for my direct reports

I have been sort of waiting to talk to you about having a small event for my direct reports to thank them for their efforts until things cooled down at the company overall, but -- I don't see that happening any time soon.

We have not really done anything at all this year, and I wanted to do an event similar to the one you had last summer for us.  They have worked so hard and we can't ever all get away from the office at the same time  -- even to have a lunch.

Was thinking about having them over to my house for drinks and then out to eat at a restraunt.  For my direct reports and spouses.  Will include both Global Services and EES.  Was thinking of Friday night after work Dec 7th.  Need to get planning if I get the go ahead.

I have a reasonably priced italian restraunt in mind, and it would be about 20 people.   Are you ok with that? And if so, would you and David want to come too?

Let me know your thoughts

Beth