Agreement No. ____________________


                             CONSTRUCTION AGREEMENT


     This  agreement  ("Agreement")  is made and entered into as of the 20th day
of June, 1996 (the "Effective Date"), by and between:  Morgan Associates,  Inc.,
a Kansas corporation,  hereinafter  referred to as "MORGAN",  and Enron Liquids 
Pipeline Operating  Limiting  Partnership,  a Delaware limited  partnership,  
hereinafter referred to as "ELPOLP".

                                WITNESSETH THAT:

     WHEREAS,  MORGAN desires the  performance  by an independent  contractor of
certain  Work  pertaining  to  the  engineering,  procurement,  management,  and
construction of a certain Odessa Lateral and Meter facility (the "Facilities").

     NOW,  THEREFORE,  in  consideration of the amount(s) of money to be paid by
MORGAN to ELPOLP, and other mutual covenants,  agreements and obligations of the
parties hereinafter set forth, the parties do hereby agree as follows:

1.   Scope of Work.  ELPOLP shall  furnish  and  pay  for all costs and expenses
     associated  with the  acquisition  of  MORGAN's  Premises,  and any  labor,
     supervision,  tools,  technical  capability,   transportation,   materials,
     supplies,  and all  other  items or  accessories  necessary  for  ELPOLP to
     perform and accomplish the Work defined and described in Exhibit "A" and in
     accordance  with the terms,  conditions,  and standards of this  Agreement,
     including the Plans and Specifications in Exhibit "B" (the "Work"). As part
     of the Work,  ELPOLP  shall  prepare  and  deliver  to MORGAN  all  design,
     construction,  operation and maintenance  information,  including,  but not
     limited to, "as-built"  drawings,  schematics  and flow diagrams as MORGAN
     may  reasonably  require for the ongoing  operation and  maintenance of the
     Facilities.

2.   Rights of Way.  ELPOLP  will  research  title  and  prepare  the  documents
     required to obtain and acquire on behalf of MORGAN all Work  places,  land,
     rights of way grants, permits,  easements,  surface easements, fee property
     (including all land) necessary for the Facilities (hereinafter collectively
     defined as "MORGAN's  Premises"),  which  MORGAN's  Premises shall include,
     without limitation:  (a) permanent easement rights pursuant to the Pipeline
     Easement  (the  "Southdown   Easement")   dated  November  29,  1995,  from
     Southdown,  Inc., aka Southwestern  Portland Cement Company,  over the real
     property described  therein;  (b) permanent easement rights pursuant to the
     Pipeline  Easement  (the "P&C  Easement")  dated  November 28,  1995,  from
     Pevehouse & Christensen Ranch Corporation, over the real property described
     therein, and (c) permanent real

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     property  interests as necessary to accommodate the metering  facilities to
     be constructed as part of the Facilities (the "Meter  Easement").  ELPOLP's
     title research and document  preparation in connection with  acquisition of
     MORGAN's Premises shall be in accordance with ELPOLP's  internal  standards
     and practices for  acquisition  of similar rights of way,  easements,  etc.
     ELPOLP will supply MORGAN with information  pertaining to title  research
     and document  preparation in connection with MORGAN's Premises.  MORGAN may
     request additional title research or changes to the documents as MORGAN may
     feel necessary.  Should ELPOLP be unable to acquire the necessary rights of
     way at a reasonable cost, or if escalated,  at a cost acceptable to MORGAN,
     on or before June 15,  1996,  this  agreement  and all further  obligations
     hereunder shall terminate.  Unless otherwise approved in writing by MORGAN,
     ELPOLP  will  acquire  on  behalf of MORGAN  permanent  rights to  MORGAN's
     Premises by the payment of a one-time  lump sum amount for each  respective
     right of way,  easement,  etc.  (such lump sum payments to be included as
     part of the Contract Price  hereunder),  and there will be no requirement
     for  payment  of  periodic  fees  (e.g.,  lease or  royalty  payments)  for
     retaining rights to or use of MORGAN's Premises.

3.   Term.  This  Agreement  shall  commence  on the  Effective  Date and  shall
     automatically  terminate upon MORGAN's  acceptance of the Work and MORGAN's
     payment therefore to ELPOLP as described herein. 

4.   Price.  MORGAN as total  consideration for the Work to be performed,  shall
     pay  ELPOLP  the  total  accumulated  costs  of  supervision,  engineering,
     procurement  services,  costs  of the  acquisition  of  MORGAN's  Premises,
     materials,  costs of rights of way, rights of temporary ingress and egress,
     damages to landowners,  fees, bonds,  insurance,  losses not compensated by
     insurance,  inspection  services,  direct and  contract  and  subcontracted
     labor,  transportation  and living  expenses,  use of furnished  equipment,
     commissioning,   permitting,   project   documentation,   taxes,  supplies,
     equipment and services,  interest  incurred from initial  expenditure until
     final payment has been received,  and all other costs and expenses incurred
     by ELPOLP in the  performance  and  completion  of the Work,  not to exceed
     $2,000,000.00 (the "Contract  Price").  In the event that ELPOLP determines
     that  the  total  costs  and  expenses  which  it has or will  incur in the
     performance  and  completion  of the Work (i.e.,  in order to complete  the
     Facilities  pursuant to the  standards  defined and described in Exhibits A
     and B hereto) will exceed $2,000,000.00, ELPOLP will promptly notify MORGAN
     of such circumstance,  providing reasonable details regarding the basis for
     such  increased  costs and expenses and the total expected cost and expense
     for  completion of the  Facilities.  Upon  receiving such written notice of
     expected cost increase, MORGAN may elect to either (i) approve the cost

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     increase,  in which event the "Contract  Price" shall  thereafter  mean the
     revised  amount  that  has  been  designated  by  ELPOLP  as the  cost  for
     completing the Work, or (ii) elect not to proceed with the  construction of
     the Facilities or completion of the Work,  and in such event,  MORGAN shall
     convey to ELPOLP, without any warranties, title to MORGAN's Premises and to
     all Work in process, completed Work, supplies, and other materials produced
     or acquired for the Work,  and ELPOLP shall refund and  reimburse to MORGAN
     any and all amounts which MORGAN has paid or advanced hereunder.

     Should  MORGAN  authorize  ELPOLP to perform  additional  Work which is not
     within  the scope and  intent of this  Agreement,  such Extra Work shall be
     reimbursed in accordance with Paragraph 11 of this Agreement.

5.   General Payment Conditions.

     (a)  Following  completion of the Work (but not earlier than July 1, 1996),
     ELPOLP  shall  prepare  an invoice  (the  "Invoice")  for the total  amount
     accrued to ELPOLP for the Work (but which may not be more than the Contract
     Price unless agreed to as provided in Paragraph 4). MORGAN shall pay ELPOLP
     the amount  accrued as shown by the  Invoice,  less any amounts  reflecting
     payment that may have been made on previous  invoices,  within  thirty (30)
     days after  receipt of the Invoice by MORGAN.  Submission of the Invoice by
     ELPOLP to MORGAN shall constitute  ELPOLP's  acknowledgement  and agreement
     that the  "Initial  Transportation  Date" has  occurred  under that certain
     Transportation   Agreement   between  MORGAN  and  ELPOLP  related  to  the
     Facilities   and   that  all   conditions   precedent   to  such   "Initial
     Transportation Date" have been satisfied.

     (b) MORGAN's  payment of the Invoice or MORGAN's earlier shipment of carbon
     dioxide through the Facilities shall constitute  MORGAN'S acceptance of the
     Work.  Acceptance by ELPOLP of such final payment shall constitute a waiver
     by it of all  claims  against  MORGAN  related  to or  arising  out of this
     Agreement.  Such final  acceptance and payment by either party hereto shall
     not,  however,  release  either  party  from  any  unperformed  obligations
     hereunder.

     (c) It is understood and the parties hereto agree that the sums to be paid,
     as set forth  above,  shall be the entire  consideration  to be received by
     ELPOLP from  MORGAN for the Work  performed  hereunder,  and that said sums
     shall include any and all taxes and contributions as set forth in Paragraph
     14  hereinbelow.  ELPOLP shall,  where  applicable,  separately list on its
     invoices all valid sales taxes on services provided hereunder.


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6.   Notices. All notices, consents,  requests,  invoices or statements provided
     for or  permitted to be given under this  Agreement  must be in writing and
     are effective on actual receipt by the intended recipient or by delivery to
     the address,  or facsimile  number during  working hours (8:00 a.m. to 5:00
     p.m. CST) for the recipient listed below:

     TO ELPOLP:                     TO MORGAN

     Enron Liquids Pipeline         Morgan Associates, Inc.
     Operating Limited Partnership  Attn:  William V. Morgan
     Attn:  Russell Martin          Plaza Time Building
     P.O. Box 1188                  411 Nichols Road, Suite 225
     Houston, Texas 77251-1188      Kansas City, Missouri 64112
     Telephone:  713-853-3589       Telephone:  816-931-5750
     Fax:  713-646-5824             Fax:  816-931-9170


     All notices,  invoices, and other communications  ("Notices") shall be sent
     to the parties at their  respective  addresses  in writing and as set forth
     above.  Notices sent through the mail shall be deemed to have been received
     on the third (3rd) day after post marking.

7.   Tax Identification  Number. ELPOLP hereby designates no. 76-0380015 as its
     tax  identification  number for all  purposes  which may require  MORGAN to
     report to  taxing  authorities  moneys  paid to  ELPOLP  for Work  provided
     hereunder.

8.   Exhibits.  This Agreement consists of the following Exhibits,  all of which
     are attached  hereto and by this reference made a part hereof:

     Exhibit A -  Scope of Work
     Exhibit B -  Plans and Specifications

9.   Inspection  of the Work.  MORGAN's  Representative  shall at all times have
     access to the Work wherever it is in  preparation  or progress,  and to any
     other location  where  equipment or material for the Work, if any, is being
     fabricated or stored by ELPOLP or its  subcontractors,  provided,  however,
     that no  inspection  or  suggestion  by  MORGAN  Representative  or  MORGAN
     employees or agents shall operate to control the method of  performance  of
     the Work  hereunder,  the manner and  method of  performing  the same being
     under the sole control and direction of ELPOLP, MORGAN having interest only
     in the results obtained,  and ELPOLP shall perform all Work hereunder as an
     independent  contractor  with full control and detailed manner and means of
     performance.

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10.  Representations, Warranties and Guarantees. With respect to this Agreement,
     ELPOLP covenants, warrants, guarantees and represents to MORGAN that:


     (a) The Work  will be  accomplished  in good and  workmanlike  manner  with
     approved  practices and  standards of the industry,  and with all plans and
     specifications  made a part of this  Agreement.  ELPOLP  shall  employ such
     methods,  tools,  equipment, and subcontractors in the performance of the
     Work under this Agreement as will ensure Work of reasonable accuracy.

     (b)  ELPOLP has authority to do business in the state in which the Work  is
     to be performed.

     (c) ELPOLP shall comply with all valid applicable federal,  state and local
     laws, ordinances and regulations thereunder, issued or promulgated by units
     of government and regulatory  bodies with  jurisdiction  over any aspect of
     the Work.

     (d)  Upon  completion  of the  Work,  the  site as it  relates  to the Work
     performed  by ELPOLP will comply with the  requirements  of all permits and
     all  valid  and  applicable   statutes,   ordinances,   orders,  rules  and
     regulations  of  the  federal,   state,   and  local   governments   having
     jurisdiction thereof.

     (e) During the "Warranty Period" (hereinafter defined), ELPOLP shall repair
     or correct at its expense any defects due to ELPOLP's  faulty  workmanship.
     In any event,  ELPOLP's liability therefor shall be limited to the Contract
     Price.  ELPOLP's  sole  obligation  to  MORGAN  with  regard  to  repair or
     corrective Work required of any supplier of equipment or materials provided
     by ELPOLP  hereunder and not  manufactured  by ELPOLP shall be to assign to
     MORGAN the  warranty or guarantee  of such  supplier  and to cooperate  and
     assist MORGAN in MORGAN's  enforcement  of its remedies and if requested by
     MORGAN to  perform  any such  repair or  corrective  Work at cost less such
     credits  as  are  recovered  from  such  supplier.  ELPOLP  guarantees  the
     workmanship for a period of twelve (12) months from MORGAN's  acceptance of
     the Work (the  "Warranty  Period").  EXCEPT AS  SPECIFICALLY  WARRANTED  BY
     ELPOLP UNDER THIS  AGREEMENT,  ELPOLP MAKES NO OTHER  WARRANTY,  EXPRESS OR
     IMPLIED,  INCLUDING  ANY  WARRANTY OF FITNESS OR  MERCHANTABILITY,  AND ANY
     STATUTORY  WARRANTIES  OR  REMEDIES  INCONSISTENT  WITH THIS  CONTRACT  ARE
     EXPRESSLY  WAIVED.  THE FOREGOING SHALL BE APPLICABLE EVEN IF THE LIABILITY
     ASSERTED IS BASED ON THE  NEGLIGENCE  (WHETHER  ACTIVE OR PASSIVE) OR OTHER
     FAULT OR STRICT LIABILITY OF THE PARTY TO BE INDEMNIFIED, AND REGARDLESS OF
     WHETHER THE ACTION OR CLAIM IS BASED IN CONTRACT,  TORT, WARRANTY,  STATUTE
     OR OTHERWISE.

11.  Extra Work - Changes.  MORGAN may require ELPOLP to perform work or furnish
     materials or equipment, or the use thereof, in

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     connection  with  the  Work  which  are  not  included  in  this  Agreement
     (hereinafter  referred to as "Extra Work"). Extra Work may be occasioned by
     major changes in pipeline specifications or routing requiring  additional
     work or materials of a materially different nature, kind and cost from that
     contemplated  at  the  time  of  execution  of  this  Agreement,  or the
     performance  of other or additional  work incident to the completion of the
     project or facilities  herein  involved,  but not in  contemplation  of the
     parties at the time of execution of this Agreement.

     ELPOLP  shall not  perform  any Extra Work  without  first  having  secured
     written  authorization  from  MORGAN  which  shall be  signed  by  MORGAN's
     Representative.  Such authorization  shall describe the Work to be done and
     specify  the price to be paid  therefor,  or the basis on which  such price
     shall be calculated.

12.  Termination and Interruption.

     (a) In the event that the Work may be delayed due to any federal, state, or
     other regulatory  authority taking any action,  or refraining from doing an
     act, or should any other  condition arise from such  authorities  which may
     cause a delay of the Work,  ELPOLP  shall  make all  reasonable  efforts to
     resolve  such a delay.  However,  in the event such  efforts do not satisfy
     said  authorities  (or the cause of such  delay) and the Work is  therefore
     indefinitely  delayed,  which, in ELPOLP's or MORGAN's reasonable judgment,
     shall make it  unreasonable  for ELPOLP to proceed  with all or any part of
     the Work under this Agreement,  MORGAN and ELPOLP may terminate the Work by
     giving the other  party  five (5) days  written  Notice of such  partial or
     complete cancellation or termination.

     If Work is so terminated after  commencement of any Work hereunder,  MORGAN
     shall pay ELPOLP for Work which has been  satisfactorily  performed  to the
     date of  termination  for  which  ELPOLP  has not  previously  been paid by
     MORGAN,  in  accordance  with  this  Agreement,  including  ELPOLP's  costs
     associated  with  proposal  preparation,   the  purchase  of  equipment  or
     materials  or  supplies,  the  acquisition  of rights of way and  rights of
     ingress  and  egress,  the  hiring  of  Subcontractors,  and the  hiring or
     reassignment  of  employees  assigned to the Work and any other  charges or
     costs associated with the cessation of the Work.

     (b) Upon notice of termination pursuant to this Paragraph:

         1.   ELPOLP shall discontinue further Work so terminated.


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         2.   ELPOLP and/or its  contractors and  subcontractors  shall have the
              right to remove its equipment,  tool sand appliances from the site
              of the Work (and in either case its personnel).

         3.   ELPOLP shall transfer title and deliver to
              MORGAN the Work in process, completed Work,
              supplies, and other materials produced or
              acquired for the Work terminated, as well as
              the completed or partially completed plans,
              Drawings, information, and other property
              that, if the Agreement had been completed,
              would be required to be furnished to MORGAN.
               "Drawings" as used herein shall mean all graphs,  depictions, and
              other visual layouts prepared by ELPOLP to describe the Work.

         4.   Morgan shall thereafter assume all
              obligations, commitments and other
              liabilities that ELPOLP has therefore
              incurred or made in connection with its
              performance of the Work and for which ELPOLP
              has not been paid and released; provided,
              however, that MORGAN shall not be required
              to make any payments to ELPOLP in excess of
              the Contract Price.

              Failure of MORGAN or ELPOLP to exercise any of the rights given it
              under this  paragraph in any  instance or  instances  shall not be
              deemed or adjudged a waiver of such right in other instances.

              Termination of this Agreement shall not relieve any party from any
              obligation  accruing  or accrued to the date of such  termination,
              nor  deprive  a  party  not in  default  of any  remedy  otherwise
              available to it. The indemnification  provisions of this Agreement
              shall  survive such  termination  relative to all claims and other
              indemnified matters,  discovered or undiscovered,  arising out of,
              in connection with, or incident to this Agreement.

     (c)  MORGAN  or  ELPOLP  may  temporarily  interrupt  or shut down all or a
     portion of the Work hereunder upon reasonable advance Notice, if any state,
     federal, or other regulatory  authority shall take any action or shall fail
     to issue or shall withhold any  authorization,  which shall make proceeding
     with the Work inadvisable or imprudent.  If all or a portion of the Work is
     thus temporarily shut down,  ELPOLP shall be paid its  unrecoverable  costs
     and expenses incurred directly applicable to such interruption.

13.  Force  Majeure.  No  delays in or  failure or  omission  in the performance
     of any  obligation  under this  Agreement by ELPOLP or  MORGAN,  other than
     payment of money, shall constitute

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     default under this  Agreement if and to the extent such delay or failure of
     performance  is caused  by  occurrences  beyond  the  control  of ELPOLP or
     MORGAN,  and which by the  exercise of due  diligence  such party shall not
     have been able to avoid or overcome, including, but not limited to: acts of
     God or the public  enemy;  expropriation  or  confiscation  of  facilities;
     compliance with any order or request of any governmental authority;  fires,
     floods,  explosion,  accidents;  strikes,  walkouts or other concerted work
     stoppages. In the event that ELPOLP has not secured all easements,  permits
     and licenses required of it in order to proceed with the construction phase
     of the Work,  or in the event of any other force majeure  condition,  which
     force majeure condition prevents ELPOLP from commencing construction of the
     facilities  contemplated  herein, the construction of such facilities shall
     not begin until such easements,  permits, and licenses are secured. If such
     time delay or other force majeure  condition causes an increase to ELPOLP's
     labor, equipment, or material costs to complete the Work by the Date stated
     herein,  or such later date if force majeure causes delay to  construction,
     ELPOLP shall furnish to MORGAN  supporting  documentation  evidencing  such
     increase in costs,  and ELPOLP shall be paid such increase in costs. In the
     event  of a force  majeure  occurrence,  the  party  whose  performance  is
     prevented by such occurrence  shall notify the other party, in writing,  as
     soon as  reasonably  possible and give full  particulars  thereof and shall
     reasonably endeavor to remedy the situation as soon as possible.

14.  Taxes and Other Payments.

     (a) Sales and Use Taxes

     ELPOLP agrees that the total  consideration  to be paid for Work  performed
     under this Agreement  includes any such sales,  use, gross receipts or like
     taxes on materials, supplies, equipment or services furnished by ELPOLP and
     on services performed by ELPOLP.  ELPOLP shall obtain the necessary permits
     and  licenses to remit  sales,  use,  gross  receipts and like taxes to the
     applicable taxing authority. ELPOLP agrees to be responsible for all taxes,
     penalties and interest  resulting  from ELPOLP's  failure to properly remit
     itemized taxes to the applicable taxing  authority.  Upon written notice to
     ELPOLP,  MORGAN may elect to directly  remit sales,  use, gross receipts or
     like taxes to the taxing  authority to whom such taxes are due and directly
     payable.  If MORGAN  exercises such  election,  MORGAN shall provide ELPOLP
     with written evidence, as required by applicable taxing authority, prior to
     ELPOLP's procurement or payment of taxable purchases.

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     (b) Other

     ELPOLP  assumes full  responsibility  for and agrees to pay for, and agrees
     that the price to be paid by MORGAN as set herein shall be fully  inclusive
     of, all labor, including overtime as legally required,all overhead, and all
     contributions  and taxes payable  under  federal and state social  security
     acts,   old  age  pension,   worker's   compensation   laws,   unemployment
     compensation  laws and income tax laws and any other  applicable laws as to
     all of its  employees  and agents  engaged in the  performance  of the Work
     hereunder,  and ELPOLP hereby agrees to be  responsible  for any failure by
     ELPOLP or any of its  subcontractors  to pay or withhold taxes,  charges or
     compensation due on behalf of its employees or agents involved in the Work.

15.  General  Indemnity.   ELPOLP  AND  MORGAN AGREE  TO INDEMNIFY,  DEFEND  AND
     HOLD HARMLESS THE OTHER PARTY FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS,
     LOSSES,  DAMAGES,  CAUSES OF ACTION,  SUITS AND  LIABILITIES OR EVERY KIND,
     INCLUDING ALL EXPENSES OF LITIGATION, COURT COSTS, AND ATTORNEY'S FEES, FOR
     INJURY TO OR DEATH OF ANY  PERSON,  OR FOR LOSS OR  DAMAGE TO ANY  PROPERTY
     CAUSED  BY  THE  NEGLIGENT  ACT  OR  OMISSION  OF ANY  EMPLOYEE,  AGENT  OR
     SUBCONTRACTOR  OF  THE  INDEMNIFYING   PARTY  IN  THE  PERFORMANCE  OF  THE
     INDEMNIFYING PARTY'S OBLIGATIONS  HEREUNDER.  IN THE EVENT ANY INJURY TO OR
     DEATH OF ANY  PERSON,  OR LOSS OR DAMAGE TO ANY  PROPERTY  IS CAUSED BY THE
     CONCURRENT  NEGLIGENCE OF BOTH PARTIES HERETO OR OF EITHER PARTY HERETO AND
     A THIRD PARTY,  THE  INDEMNIFYING  PARTY HERETO SHALL  INDEMNIFY  THE OTHER
     PARTY ONLY TO THE  EXTENT  ITS  NEGLIGENCE  CONTRIBUTED  TO SUCH  DAMAGE OR
     INJURY.  NEITHER PARTY SHALL HAVE LIABILITY FOR ANY CLAIM,  DAMAGE OR CAUSE
     OF ACTION  RESULTING  FROM THE WILLFUL  MISCONDUCT,  BAD FAITH OR NEGLIGENT
     ACTS OR OMISSIONS OF THE OTHER PARTY'S EMPLOYEES,  AGENTS OR CONTRACTORS OR
     SUBCONTRACTORS.

     NOTWITHSTANDING  ANY PROVISION OF THIS PARAGRAPH 15, WHERE PERSONAL INJURY,
     DEATH,  OR  LOSS OF OR  DAMAGE  TO  PROPERTY  RESULTS  FROM  THE  JOINT  OR
     CONCURRENT  NEGLIGENCE OR WILLFUL MISCONDUCT OF BOTH ELPOLP AND MORGAN, THE
     PARTIES'  DUTY OF  INDEMNIFICATION  SHALL BE IN  PROPORTION TO EACH PARTY'S
     ALLOCABLE  SHARE OF JOINT OR CONCURRENT  NEGLIGENCE OR WRONGFUL  MISCONDUCT
     EVEN IF ONE OF THE PARTIES IS MORE THAN FIFTY PERCENT (50%) AT FAULT.

16.  Limitation   of   Liability.   NOTWITHSTANDING   ANYTHING  HEREIN  TO   THE
     CONTRARY,  IN NO EVENT SHALL  ELPOLP OR MORGAN BE LIABLE TO THE OTHER PARTY
     HERETO FOR ANY LOST OR PROSPECTIVE PROFITS OR ANY OTHER SPECIAL,  PUNITIVE,
     EXEMPLARY,  CONSEQUENTIAL,  INCIDENTAL  OR  INDIRECT  LOSSES OR DAMAGES (IN
     TORT, CONTRACT OR OTHERWISE),  UNDER OR IN RESPECT HERETO HOWSOEVER CAUSED,
     WHETHER OR NOT ARISING FROM ELPOLP'S OR MORGAN'S SOLE,  JOINT OR CONCURRENT
     NEGLIGENCE.

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17.  Safety   Precautions.   ELPOLP  shall  be  responsible  for  and  take  all
     necessary and proper safety precautions to protect from accident or injury,
     all persons, including its employees and its subcontractors' employees, who
     may be at or on MORGAN's Premises where the Work is being performed. ELPOLP
     shall establish and enforce adequate, reasonable, prudent and proper safety
     rules and procedures and emergency procedures necessary for safe completion
     of the Work.

18.  Compliance  With  Laws  and  Regulations.   ELPOLP  certifies  that  unless
     specifically  exempted,  all  products,  or services  furnished  under this
     Agreement  have been furnished in compliance  with all applicable  laws and
     regulations.

19.  Environmental Waste.  Notwithstanding any provisions
     contained to the contrary, in the event that the Work
     requires ELPOLP to remove or handle hazardous
     materials, waste or soils or materials contaminated
     with such materials, waste or substances ("Waste"),
     except for Wastes that are brought onto MORGAN's
     Premises by ELPOLP or its subcontracts or are present
     upon MORGAN's Premises arising from the negligence or
     willful misconduct of ELPOLP or its subcontractors or
     first generated by ELPOLP or its subcontractors at
     their own premises, MORGAN SHALL REMAIN RESPONSIBLE
     FOR SUCH WASTES AND FOR ANY POLLUTION EMANATING FROM
     MORGAN'S PREMISES AND SHALL DEFEND,INDEMNIFY AND HOLD
     ELPOLP HARMLESS FROM AND AGAINST ANY LOSS, COST,
     CLAIM, DAMAGE, LIABILITY, FINE OR PENALTY INCURRED BY
     ELPOLP WHICH RESULTS OR IS ALLEGED TO RESULT FROM
     ELPOLP'S PERFORMANCE OF SUCH WORK, HOWEVER ARISING;
     PROVIDED, HOWEVER, THAT THE FOREGOING INDEMNITY SHALL
     NOT APPLY WITH RESPECT TO ANY SUCH LOSSES, COSTS,
     CLAIMS, DAMAGES, LIABILITIES, FINES OR PENALTIES
     ARISING FROM THE NEGLIGENCE OR WILLFUL MISCONDUCT OF
     ELPOLP OR ITS SUBCONTRACTORS.  Waste as used herein
     shall include, but not be limited to, any garbage,
     refuse, sludge and other present or discarded
     material, including solid, liquid, semisolid, or
     contained gaseous materials resulting from
     industrial, commercial, mining and agricultural
     activities or from community or individual
     activities, and including all waste classified as
     "hazardous" pursuant to the Resource Conservation and
     Recovery Act, as amended; "toxic waste" pursuant to
     the Toxic Substances Control Act, as amended; or
     asbestos.  ELPOLP shall notify MORGAN of any
     discovery of any Waste associated with the Work, but
     ELPOLP shall not be required to arrange for the
     disposal or off-site removal of such Waste unless (i)
     specifically agreed upon in writing by a duly
     authorized officer of ELPOLP, or (ii) such Waste was
     brought onto MORGAN's Premises by ELPOLP or its
     subcontractors or is present upon MORGAN's Premises
     arising from the negligence or willful misconduct of
     ELPOLP or its subcontractors.


                            10

<PAGE>



20.  Compliance With DOT Anti-Drug and Alcohol Misuse
     Regulations.  MORGAN under 49 CFR Parts 199 and 40,
     is required by law to ensure compliance with the
     pipeline safety regulations for drug and alcohol
     testing applicable to its contractors, subcontractors
     and their agents, performing operations, maintenance,
     or emergency response functions on a pipeline or LNG
     facility subject to Parts 191, 192, 193 and 195 of
     Title 49 of the Code of Federal Regulations.  ELPOLP
     agrees to comply with such requirements and will
     require compliance by its employees, agents,
     contractors and subcontractors.

21.  Independent Contractor.  The parties hereto agree
     that the Work rendered by ELPOLP in the fulfillment
     of the terms and obligations of this Agreement shall
     be as an independent contractor, and this Agreement
     does not create an employer/employee relationship
     between MORGAN and ELPOLP.  ELPOLP is not entitled to
     the benefits provided by MORGAN or its parent,
     subsidiaries or affiliates to their employees, and
     ELPOLP is not an agent, partner, or joint venturer of
     MORGAN, its parent or any subsidiary or affiliate.
     ELPOLP shall act at its own risk and expense in its
     fulfillment of the terms and obligations of this
     Agreement and agrees to employ and direct any persons
     performing any Work hereunder.  ELPOLP shall not
     represent itself to third persons to be other than an
     independent contractor of MORGAN, nor shall ELPOLP
     offer to agree to incur or assume any obligations or
     commitments in the name of MORGAN.

22.  Governing Law.  Unless otherwise specified, this
     Agreement and the rights and duties of the parties
     arising out of this Agreement shall be governed by
     and construed in accordance with the laws of the
     State of Texas, except provisions of that law
     referring to governance or construction of the laws
     of another jurisdiction.  Any action arising out of
     this Agreement or the rights and duties of the
     parties arising out of this Agreement may be brought,
     if at all, only in the courts of Texas.  Venue shall
     be proper in Harris County.

23.  Subcontracting.  ELPOLP shall cause each
     subcontractor to assume and satisfy all obligations
     of ELPOLP hereunder to the full extent same may be
     applicable to the portions of the Work
     subcontracted.  ELPOLP shall be liable for all acts
     and omissions of any subcontractor or any of their
     employees or agents, as if performed or omitted by
     ELPOLP.

24.  Contractual Rights.  The terms and provisions of this
     Agreement shall inure to the benefit of and be
     binding upon the successor, assigns and
     representatives of the parties hereto.  The
     provisions of this Agreement shall not impart rights
     enforceable by any person, firm or organization not a
     party or not bound as a party, or not a permitted
     successor or assignee of a party bound to this
     Agreement.

                            12

<PAGE>



25.  Assignability.  Neither party may assign its rights
     under this Agreement without the prior written
     consent of the other party, which shall not be
     unreasonably withheld.  Written consent to assign
     said rights shall not be necessary when this
     Agreement is assigned in whole or in part to a wholly
     owned subsidiary or affiliate, or by:  (i) name
     change, or (ii) merger, or (iii) formation of a new
     company, or (iv) stock purchase.  If and in the event
     MORGAN desires to sell the Facilities then MORGAN
     shall give at least thirty (30) days notice to ELPOLP
     setting forth the name of the potential buyer and
     ELPOLP shall, within said thirty (30) day period,
     elect to either terminate this Agreement or to
     approve MORGAN's assignment of this agreement to the
     potential buyer.

26.  General.  The terms and provisions of this Agreement
     are intended to supersede any conflicting terms or
     conditions in any other agreement between the
     parties.  This Agreement contains the entire
     agreement between the parties and shall not be
     modified or supplemented except by written instrument
     duly executed by both parties.  If any provision of
     this Agreement shall, for any reason, be held
     violative of any applicable law, and so much of said
     Agreement is held to be unenforceable, then the
     invalidity of such a specific provision herein shall
     not be held to invalidate any other provisions
     herein, which other provisions shall remain in full
     force and effect unless removal of said invalid
     provision destroys the legitimate purposes of this
     Agreement, in which event this Agreement shall be
     canceled.  The terms and provisions of Paragraphs 2,
     10, 15, 19, 22, 23 and 27 shall survive the
     termination of this Agreement.  No waiver of any of
     the provisions of this Agreement shall be deemed or
     shall constitute a waiver of any other provisions
     hereof (regardless of whether similar), nor shall any
     such waiver constitute a continuing waiver unless
     otherwise expressly provided.

27.  Claims.  MORGAN shall assert any and every "Claim" of
     any kind or nature whatsoever under this Agreement
     ("Claim" to include, without limitation, any Claim
     relating to, associated with, arising out of or in
     any way incidental to the Work or the execution,
     inducement to enter into, performance, non-
     performance, or breach of this Agreement) exclusively
     against ELPOLP and not against any one or more of its
     partners nor the general partner, Enron Liquids
     Pipeline Company, nor their officers, directors,
     employees, or agents nor entities affiliated with it
     by common ownership or control, nor any of them
     individually or collectively; and MORGAN shall
     enforce or attempt to enforce against the assets of
     ELPOLP and not against the assets of any partner,
     general partner, affiliated entity, nor any of their
     officers, directors, employees or agents, except the
     general partner's interest in ELPOLP.


                            13

<PAGE>



28.  Cooperation.  The parties shall take such reasonable
     further actions, execute such further documents and
     otherwise cooperate and assist one another in any
     manner reasonably necessary to give effect to and
     carry out the provisions hereof.


IN WITNESS  WHEREOF,  this Agreement is executed on the day and year first above
written, but is effective on the Effective Date.


"ELPOLP"                       "MORGAN"
Enron Liquids Pipeline
Operating Limited Partnership
by Enron Liquids Pipeline
Company, its General Partner   Morgan Associates, Inc.

By: /s/ Ray Kaskel             By: /s/ William V. Morgan

Title: President               Title: President

Witness/Attest                 Attest:

By: /s/ Thomas P. Tosoni       By:

Title: Assistant Secretary     Title:

(SEAL                          (SEAL)




                            14

<PAGE>



-------------------------------------------------------------------------
                               EXHIBIT "A"

                               OCS ROSWELL

                          PROJECT COST ESTIMATE
                                 5/2/96

-------------------------------------------------------------------------

CUSTOMER COMPANY NAME: ENRON LIQUIDS
     PROJECT NAME:    6" SO. ODESSA LAT.
      W.O. NUMBER:
  PROJECT MANAGER:    JOE MILLS
  REVISION NUMBER:    ALLIANCE ESTIMATE

-------------------------------------------------------------------------

                              PROJECT SCOPE

-------------------------------------------------------------------------

CO2 PIPELINE: INSTALL 11.1 MILES OF PIPELINE, SIDE VALVE AND METER
STATION FACILITY
   1) PIPING WILL BE 6" AND MATCH GRADE AND WALL IN DESIGN
   2) LOCATION WILL BE BETWEEN PENWELL AND ODESSA, TX.
   3) LINE WILL TIE IN AT THE CENTRAL BASIN PIPELINE PIG LAUNCHER/RECEIVERS 
      NEAR PENWELL
   4) THE LINE PROCEEDS APPROXIMATELY DUE EAST TO A DELIVERY POINT TO
      PHILLIPS






                                       BEST         WORST      MOST PROB.






COST FOR ESTIMATE/CO2 PIPELINE    $  1,238,840  $  1,587,989  $1,402,532

















-------------------------------------------------------------------------


                                Page 1

<PAGE>



-------------------------------------------------------------------------

                               OCS ROSWELL

                          PROJECT COST ESTIMATE
                                 5/2/96

-------------------------------------------------------------------------

CUSTOMER COMPANY NAME: ENRON LIQUIDS
     PROJECT NAME:    6" SO. ODESSA LAT.
      W.O. NUMBER:
  PROJECT MANAGER:    JOE MILLS
  REVISION NUMBER:    ALLIANCE ESTIMATE

-------------------------------------------------------------------------

                          NOTES AND ASSUMPTIONS

-------------------------------------------------------------------------

   1) PROJECT IS FOR 11.1 MILES OF 6 INCH PIPELINE
   2) PROJECT REQUIRES SIDE VALVE SETTING ON PIPELINE
   3) MEASUREMENT STATION WILL BE INSTALLED WITH PIPELINE



































-------------------------------------------------------------------------


                                Page 2

<PAGE>
<TABLE>
<CAPTION>



--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL

                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                           MATERIAL AND EQUIPMENT COSTS

--------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          MOST
                                                                                        BEST CASE      WORST CASE       PROBABLE
                   DESCRIPTION                                                            COST            COST            COST
                                                     Qty.       Unit     Unit Cost      ESTIMATE        ESTIMATE        ESTIMATE
------------------------------------------------------------------------------------------------------------------------------------
P.U. NO.
------------------------------------------------------------------------------------------------------------------------------------
<S>        <C>                                       <C>         <C>   <C>               <C>             <C>             <C> 
340-06     6" PIPE (E)        (.1)  (.1)(.2)(.7)     58600       FT    $ 6.37            $ 354,530       $ 410,200       $ 373,282
------------------------------------------------------------------------------------------------------------------------------------
534-01     4" METER RUN (E)   (.1)  (.1)(.2)(.7)       1         EA    $ 9,000           $   8,100       $   9,900       $   9,000
------------------------------------------------------------------------------------------------------------------------------------
520-01     EFM (E)            (.1)  (.1)(.1)(.8)       1         EA    $ 4,500           $   4,050       $   4,950       $   4,500
------------------------------------------------------------------------------------------------------------------------------------
120-01     VSAT (E)           (.1)  (.1)(.2)(.8)       1         EA    $ 15,000          $  13,500       $  16,500       $  15,000
------------------------------------------------------------------------------------------------------------------------------------
714-01     STRAINER (E)       (.1)  (.1)(.2)(.7)       1         EA    $ 2,700           $   2,500       $   3,000       $   2,700
------------------------------------------------------------------------------------------------------------------------------------
120-00     UPS (E)            (.1)  (.1)(.1)(.8)       1         EA    $ 4,500           $   4,050       $   4,950       $   4,500
------------------------------------------------------------------------------------------------------------------------------------
521-01     TRANSMITTERS (E)   (.1)  (.1)(.1)(.8)       4         EA    $ 1,000           $   3,600       $   4,400       $   4,000
------------------------------------------------------------------------------------------------------------------------------------
920-04     BALL VALVES (E)    (.1)  (.1)(.2)(.7)       1         LT    $ 18,000           $ 16,000       $  20,000       $  18,000
------------------------------------------------------------------------------------------------------------------------------------
672-00     3" CONTROL VALVE (E)(.1)  (.1)(.2)(.7)      1         EA    $ 3,600            $  3,300       $   4,000       $   3,600
------------------------------------------------------------------------------------------------------------------------------------
972-04     4" CHECK VALVE (E) (.1)  (.1)(.2)(.7)       1         EA    $ 2,100            $  1,900       $   2,300       $   2,100
------------------------------------------------------------------------------------------------------------------------------------
131-01     AIR COMPRESSOR (E) (.1)  (.2)(.1)(.7)       1         EA    $ 2,300            $  1,900       $   2,600       $   2,300
------------------------------------------------------------------------------------------------------------------------------------
086-01     BUILDING (E)       (.1)  (.2)(.1)(.7)       1         EA    $ 6,000            $  5,400       $   6,600       $   6,000
------------------------------------------------------------------------------------------------------------------------------------
237-01     AREA LIGHTING (E)  (.7)  (.1)(.4)(.5)       1         EA    $ 1,000            $  1,000       $   1,500       $   1,200
------------------------------------------------------------------------------------------------------------------------------------
235-01     TRANSFORMER (E)    (.1)  (.1)(.2)(.7)       1         EA    $ 1,000            $  1,000       $   1,500       $   1,100
------------------------------------------------------------------------------------------------------------------------------------
104-01     TEST STATIONS (E)  (.7)  (.1)(.4)(.5)      50         EA    $    50            $  4,000       $   6,000       $   5,000
------------------------------------------------------------------------------------------------------------------------------------
340-00     PIPELINE MARKERS (E)(.1)  (.1)(.2)(.7)     50         EA    $    20            $    800       $   1,200       $   1,000
------------------------------------------------------------------------------------------------------------------------------------
941-06     OTHER MATERIALS (E) (.4)  (.1)(.3)(6)       1         LT    $ 9,000            $  7,000       $  10,000       $   9,000
------------------------------------------------------------------------------------------------------------------------------------
346-00     SRINKSLEEVES (B&H) (.1)  (.3)(.2)(.5)       1         LT                       $  6,500       $  10,000       $   9,130
------------------------------------------------------------------------------------------------------------------------------------
269-01     H-BRACES (B&H)     (.1)  (.3)(.2)(.5)       6         SET                      $  1,750       $   3,000       $   2,000
------------------------------------------------------------------------------------------------------------------------------------
269-02     GATES (B&H)        (.1)  (.3)(.2)(.5)       6         EA                       $  1,700       $   2,600       $   2,000
------------------------------------------------------------------------------------------------------------------------------------
340-00     EXPENDABLES (B&H)  (.1)  (.2)(.2)(.6)       1         LT                       $  1,800       $   4,000       $   3,000
------------------------------------------------------------------------------------------------------------------------------------
340-00     PIGS (B&H)         (.7)  (.3)(.3)(.4)       1         LT                       $  1,500       $   3,000       $   2,000
------------------------------------------------------------------------------------------------------------------------------------
238-01     ELECTRICAL (E)     (.3)  (.2)(.3)(.5)       1         LT                       $  1,500       $   3,000       $   2,000
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
904-01     TAX                             7.25%                                          $ 32,435       $  38,802       $  34,975
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
903-00     FREIGHT                          4.5%                                          $ 20,132       $  24,084       $  21,709
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
MATERIALS AND EQUIPMENT COSTS SUB-TOTAL                                                   $499,947       $ 598,086       $ 539,095
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                                     Page 3

<PAGE>


<TABLE>
<CAPTION>


--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL
                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
                                                FIELD DIRECT COSTS
--------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          MOST
                                                                                        BEST CASE      WORST CASE       PROBABLE
                   DESCRIPTION                                                            COST            COST            COST
                                                     Qty.       Unit     Unit Cost      ESTIMATE        ESTIMATE        ESTIMATE
------------------------------------------------------------------------------------------------------------------------------------
P.U. NO.
------------------------------------------------------------------------------------------------------------------------------------
<S>        <C>                                       <C>        <C>      <C>               <C>            <C>
900-00     DISTRICT LABOR (E) (.2)  (.3)(.2)(.5)      176        HR                        $  5,600       $  6,720        $  6,160
------------------------------------------------------------------------------------------------------------------------------------
901-00     PIPE AND COATING INSP(.2)  (.3)(.2)(.5)                                         $  6,500       $  7,000        $  6,500
------------------------------------------------------------------------------------------------------------------------------------
901-00     X-RAY (E)          (.2)  (.3)(.2)(.5)       1         LT                        $ 15,000       $ 29,000        $ 20,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     INSPECTION (E)     (.3)  (.1)(.3)(.6)      46         DAY     $   300           $ 13,200       $ 18,000        $ 13,800
------------------------------------------------------------------------------------------------------------------------------------
901-00     SURVEY (E)         (.1)  (.1)(.2)(.7)      15         DAY     $   500           $ 13,000       $ 14,000        $ 18,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     ARCHY (E)          (.1)  (.1)(.2)(.7)       1         LT                        $  4,000       $  7,000        $  5,000
------------------------------------------------------------------------------------------------------------------------------------
504-03     R-O-W (E)          (.1)  (.1)(.2)(.7)                                           $ 80,000       $ 95,000        $ 85,000
------------------------------------------------------------------------------------------------------------------------------------
504-13     LAND SERVICES (E)  (.1)  (.1)(.2)(.7)                                           $  7,000       $  8,500        $  7,500
------------------------------------------------------------------------------------------------------------------------------------
901-00     MOB. CHARGE (B&H)  (.2)  (.3)(.1)(.6)       1         LT                        $ 14,000       $ 20,000        $ 18,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     FENCES (B&H)       (.1)  (.1)(.2)(.7)       6         EA                        $  7,500       $ 13,500        $  9,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     ROW PREP (B&H)     (.2)  (.3)(.2)(.5)       1         LT                        $  9,700       $ 13,500        $ 11,600
------------------------------------------------------------------------------------------------------------------------------------
901-00     DITCH (B&H)        (.6)  (.3)(.3)(.4)     58600       FT                        $ 37,000       $ 45,000        $ 41,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     HAUL/STRING (B&H)  (.2)  (.1)(.2)(.7)       1         LT                        $  6,600       $  9,800        $  8,200
------------------------------------------------------------------------------------------------------------------------------------
901-00     SETUP (B&H)        (.2)  (.1)(.2)(.7)       1         LT                        $  6,400       $  9,600        $  8,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     LAY & WELD (B&H)   (.6)  (.3)(.3)(.4)       1         LT                        $ 41,000       $ 51,000        $ 44,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     COAT & LOWER IN (B&H)(.3)  (.2)(.2)(.6      1         LT                        $  7,200       $ 12,800        $ 11,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     TIE-IN (B&H)       (.6)  (.3)(.3)(.4)       1         LT                        $ 45,000       $ 60,000        $ 55,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     CLEAN UP (B&H)     (.2)  (.3)(.2)(.5)       1         LT                        $ 13,600       $ 15,400        $ 15,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     RESEED (B&H)       (.2)  (.2)(.2)(.6)       1         LT                        $  6,100       $  7,500        $  6,800
------------------------------------------------------------------------------------------------------------------------------------
901-00     HYDRO-TEST (B&H)   (.6)  (.2)(.3)(.5)       1         LT                        $  8,500       $ 11,400        $  9,500
------------------------------------------------------------------------------------------------------------------------------------
901-00     SPREAD BOSS (B&H)  (.1)  (.2)(.1)(.7)       1         LT                        $ 22,400       $ 28,800        $ 25,650
------------------------------------------------------------------------------------------------------------------------------------
901-00     ELECTRICAL (B&H)   (.1)  (.2)(.2)(.6)       1         LT                        $  2,000       $  3,000        $  2,500
------------------------------------------------------------------------------------------------------------------------------------
901-00     WELDER Q. TEST (B&H)(.4)  (.2)(.2)(.6)      8         EA                        $  2,700       $  3,600        $  3,000
------------------------------------------------------------------------------------------------------------------------------------
901-00     FAB-3 SITES (B&H)  (.4)  (.2)(.2)(.6)       1         LT                        $  7,500       $ 10,000        $  8,700
------------------------------------------------------------------------------------------------------------------------------------
269-03     FENCE 10X10 (B&H)  (.1)  (.2)(.1)(.7)       1         LT                        $    540       $    660        $    600
------------------------------------------------------------------------------------------------------------------------------------
269-04     FENCE 100X50 (B&H) (.1)  (.2)(.1)(.7)       1         LT                        $  3,400       $  4,200        $  3,800
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
N/A        ENRON FDC COST                                                                  $144,300       $185,220        $161,960
------------------------------------------------------------------------------------------------------------------------------------
N/A        B&H FDC                                                                         $241,140       $319,760        $281,350
------------------------------------------------------------------------------------------------------------------------------------
901-00     B&H OVERHEAD                      23%                                           $ 55,462       $ 73,545        $ 64,711
------------------------------------------------------------------------------------------------------------------------------------
N/A        B&H TOTAL                                                                       $296,602       $393,305        $346,061
------------------------------------------------------------------------------------------------------------------------------------
          FIELD DIRECT COSTS SUB-TOTAL                                                     $440,902       $578,525        $508,021
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                                     Page 4

<PAGE>

<TABLE>
<CAPTION>


--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL

                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                               PROJECT SUPPORT COSTS

--------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          MOST
                                                                                        BEST CASE      WORST CASE       PROBABLE
                   DESCRIPTION                                            Unit            COST            COST            COST
                                                      Qty.       Unit     Cost          ESTIMATE        ESTIMATE        ESTIMATE
<S>          <C>                                      <C>         <C>   <C>             <C>            <C>              <C>
------------------------------------------------------------------------------------------------------------------------------------
P.U.NO.      INSTALLATION COSTS
------------------------------------------------------------------------------------------------------------------------------------
             TOTAL M&E COST                                                             $   499,947    $   598,086      $  539,095
------------------------------------------------------------------------------------------------------------------------------------
             TOTAL FD COST                                                              $   440,902    $   578,525      $  508,021
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
             PROJECT SUPPORT COSTS
------------------------------------------------------------------------------------------------------------------------------------
901-00       ENGINEERING SVCS (PDI)(.1)(.15).15)(.7)                                    $    12,000    $    18,000      $   15,000
------------------------------------------------------------------------------------------------------------------------------------
990-01       ENGINEERING RECORDS               2%                                       $    18,817    $    23,532      $   20,942
------------------------------------------------------------------------------------------------------------------------------------
990-01       OCS                  (1)(.2)(.2)(.6)                                       $     7,200    $    10,800      $    9,000
------------------------------------------------------------------------------------------------------------------------------------
316-01       CO2 LINE PACK (E)   (.1)(.2)(.1)(.7)     10,652      MCF   $ 0.65          $     6,924    $    10,386      $    6,924
------------------------------------------------------------------------------------------------------------------------------------
990-01       PURCHASING (DUANE MOODY) (E)                                               $     2,000    $     5,000      $    2,500
------------------------------------------------------------------------------------------------------------------------------------
901-00       M&H PROJ MGMT (E)   (.1)(.2)(.1)(.7)                                       $    28,000    $    39,200      $   33,600
------------------------------------------------------------------------------------------------------------------------------------
             OVERHEADS
------------------------------------------------------------------------------------------------------------------------------------
             - ELP RATE                        0%                                       $         -    $         -      $        -
------------------------------------------------------------------------------------------------------------------------------------
             - GROUP RATE                      0%                                       $         -    $         -      $        -
------------------------------------------------------------------------------------------------------------------------------------
             - AFUDC (10.58% x 3 MON)          0%                                       $         -    $         -      $        -
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
             RISK FUNDS & PROFITS
------------------------------------------------------------------------------------------------------------------------------------
             RISK FUNDS                                                                 $   135,550    $   304,460      $  214,950
------------------------------------------------------------------------------------------------------------------------------------
901-00       B&H RANGE                                                                  $    87,500    $         -      $   52,500
------------------------------------------------------------------------------------------------------------------------------------
             PDI RANGE
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
              TOTAL ESTIMATED COST                                                      $ 1,238,840    $ 1,587,989      $1,402,532
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
ESTIMATED PROBABILITY OF OCCURRENCE                                                             30%            20%             50%
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                                     Page 5

<PAGE>


<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL

                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                                   RISK FACTORS

--------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------

<S>               <C>


SEE "RISK FUNDS"



































===================================================================================================================================

</TABLE>

                                                     Page 6

<PAGE>

<TABLE>
<CAPTION>


--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL

                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                               PROJECT CONTACT LIST

--------------------------------------------------------------------------------------------------------------------
        <S>                <C>            <C>                             <C>           <C> 

          NAME                               OFFICE                        Mobile             PAGER
        Joe Mills          M&H            505/627-8153                                  800/327-9957
        Jack Moody         Enron Liquids
        Rick Miller        Enron Liquids
        Earl Chanley       Transwestern   505/625-8031








                                                     Page 7

<PAGE>

</TABLE>

<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------------------
                                                    OCS ROSWELL

                                               PROJECT COST ESTIMATE
                                                      5/2/96
--------------------------------------------------------------------------------------------------------------------
       CUSTOMER COMPANY NAME:      ENRON LIQUIDS
                PROJECT NAME:      6" SO. ODESSA LAT.
                 W.O. NUMBER:
             PROJECT MANAGER:      JOE MILLS
             REVISION NUMBER:      ALLIANCE ESTIMATE
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------

                                                    RISK FUNDS

--------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                          MOST
                                                                                       BEST CASE      WORST CASE        PROBABLE
                  DESCRIPTION                                                            COST            COST             COST
                                                    Qty.       Unit     Unit Cost      ESTIMATE        ESTIMATE         ESTIMATE
<S>          <C>                                      <C>       <C>     <C>              <C>            <C>              <C>
------------------------------------------------------------------------------------------------------------------------------------
P.U.NO.
------------------------------------------------------------------------------------------------------------------------------------
900-00       MATL. DELV. (E)   (.4)(.3)(.3)(.4)       1         LT                       $   1,000      $  12,000        $  10,000
------------------------------------------------------------------------------------------------------------------------------------
900-00       SURVEY (E)        (.3)(.4)(.1)(.5)       1         LT                       $   1,000      $  20,000        $  10,000
------------------------------------------------------------------------------------------------------------------------------------
900-00       SCOPE CHANGES (E) (.2)(.3)(.1)(.6)       1         LT                       $   5,000      $  20,000        $  10,000
------------------------------------------------------------------------------------------------------------------------------------

------------------------------------------------------------------------------------------------------------------------------------
901-00       ROCK (B&H)        (.9)(.3)(.3)(.4)       1         LT                       $  86,100      $ 125,460        $ 104,550
------------------------------------------------------------------------------------------------------------------------------------
901-00       PAD (B&H)         (.9)(.3)(.3)(.4)       1         LT                       $  14,750      $  19,000        $  17,700
------------------------------------------------------------------------------------------------------------------------------------
901-00       WEATHER (B&H)     (.2)(.3)(.1)(.6)       1         LT                       $   5,000      $  20,000        $  10,000
------------------------------------------------------------------------------------------------------------------------------------
901-00       FIELD BENDS (B&H) (.1)(.1)(.1)(.8)       1         LT                       $     500      $   1,500        $   1,000
------------------------------------------------------------------------------------------------------------------------------------
901-00       LABOR AVIB. (B&H) (.2)(.4)(.1)(.5)       1         LT                       $     500      $   7,500        $   5,000
------------------------------------------------------------------------------------------------------------------------------------
901-00       REWORK (B&H)      (.8)(.2)(.1)(.7)       1         LT                       $   5,000      $  30,000        $  15,000
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901-00       HYD/MATL FAIL (B&H)(.2)(.2)(.1)(.7)      1         LT                       $     750      $   7,500        $   1,500
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901-00       GRUBBING (B&H)    (.3)(.4)(.1)(.5)       1         LT                       $     100      $  10,000        $   5,000
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901-00       EXCAV. UNKNO (B&H)(.8)(.3)(.1)(.6)       1         LT                       $   1,000      $   5,000        $   2,500
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901-00       ROAD TO METER SITE(.9)(.3)(.3)(.4)       1         LT                       $   7,375      $   9,500        $   8,850
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901-00       ROAD TO TAKE OFF (B)(.9)(.3)(.3)(.4)     1         LT                       $   7,375      $   9,500        $   8,850
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901-00       CON. DWG. (PDI)   (.1)(.1)(.1)(.8)       1         LT                       $     100      $   7,500        $   5,000
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SUBTOTALS
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900-00       ENRON RISK FUNDS                                                            $   7,000      $  52,000        $  30,000
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901-00       B&H RISK FUNDS                                                              $ 128,450      $ 244,960        $ 179,950
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901-00       PDI RISK FUNDS                                                              $     100      $   7,500        $   5,000
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                                      RISK FUND                                          $ 135,000      $ 304,460        $ 214,950
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</TABLE>


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<PAGE>



                                                   JOINT LENGTH
<TABLE>
<CAPTION>

====================================================================================================================================

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60' VS 40' ECONOMICS
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                     PRICE/FT
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                                                                                                        NET             HAUL
                                                                       SHRINK          WELDING          PRICE           FROM
                     UP TO                                             SLEEVE          SAVINGS          STRUNG          ODESSA
   JT LENGTH          ROW           TO RAILYD         STRING          SAVINGS           (25%)           ON ROW          TOTAL
<S>                   <C>               <C>             <C>            <C>              <C>              <C>           <C> 
------------------------------------------------------------------------------------------------------------------------------------
40                    $6.37                             $0.05                                            $6.42         $2,930
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57                    $6.46                             $0.05                                            $6.51         $2,930
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57                                      $6.31           $0.11          ($0.04)          ($0.17)          $6.21         $6,600
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====================================================================================================================================
</TABLE>


                                                      Page 1

<PAGE>


                                          EXHIBIT "B"

                                  Engineering Specifications


The following Index of Project  Specifications  represents,  but does not limit,
the ENRON Engineering Specifications to be used:

ELPOLP  shall  comply  with  all   applicable   Specifications.   The  following
Specifications should cover the majority of the "Work".  Engineering Standards #
7503,  4701,  4732,  4736, 4742, 4747, 4915, 6601, 6625, 6634, 6637, 6639, 6651,
6660,  6700,  6710,  6720, 8100, 8101, 8110, 8116, 8125, 8126, 8155, 8301, 8308,
8310, 8312, 8315, 8360, 8362, 8375, 8405, 8415, and 8475.







<PAGE>