<PAGE>   1
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                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

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

                                    FORM 10-Q

[x]          QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934

                FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 1997

[ ]          TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
             OF THE SECURITIES EXCHANGE ACT OF 1934

                           COMMISSION FILE NO. 1-13584

                      ENRON GLOBAL POWER & PIPELINES L.L.C.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

              DELAWARE                                      76-0456366
   (State or other jurisdiction of                       (I.R.S. Employer
   incorporation or organization)                       Identification No.)

  333 CLAY STREET, SUITE 1800
           HOUSTON, TEXAS                                      77002
 (Address of principal executive offices)                    (ZIP CODE)
                          

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 853-6220

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

     Indicate by check mark whether the registrant (1) has filed all reports
     required to be filed by Section 13 or 15(d) of the Securities Exchange Act
     of 1934 during the preceding 12 months (or for such shorter period that the
     registrant was required to file such reports), and (2) has been subject to
     such filing requirements for the past 90 days.
                                                        Yes X No

     Indicate the number of shares outstanding of each of the issuer's classes
     of common shares, as of the latest practicable date:

             CLASS                         OUTSTANDING AS OF OCTOBER 31, 1997
             -----                         ----------------------------------
         Common Shares                               26,021,662 shares

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

<PAGE>   2
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                         PAGE
                                                                          NO.
                                                                         ----
<S>                                                                       <C>
PART I. FINANCIAL INFORMATION
  Item 1. Financial Statements
     Consolidated Statements of Income -- Three Months
      Ended September 30, 1997 and 1996 and Nine Months Ended
      September 30, 1997 and 1996....................................      1
     Consolidated Balance Sheets -- September 30, 1997 and
      December 31, 1996..............................................      2
     Consolidated Statements of Cash Flows -- Nine Months
      Ended September 30, 1997 and 1996..............................      3
     Consolidated Statements of Changes in Shareholders'
      Equity -- Nine Months Ended September 30, 1997.................      4
     Notes to Consolidated Financial Statements......................      5
  Item 2. Management's Discussion and Analysis of Financial
     Condition and Results of Operations.............................     12
PART II. OTHER INFORMATION
  Item 4. Submission of Matters to a Vote of Security
     Holders.........................................................     23
  Item 5. Other Matters..............................................     23
  Item 6. Exhibits and Reports on Form 8-K...........................     23

</TABLE>



                                       i
<PAGE>   3
                      ENRON GLOBAL POWER & PIPELINES L.L.C.
                          PART I. FINANCIAL INFORMATION
                          ITEM 1. FINANCIAL STATEMENTS
                        CONSOLIDATED STATEMENTS OF INCOME
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                          THREE MONTHS ENDED     NINE MONTHS ENDED
                                                                             SEPTEMBER 30,          SEPTEMBER 30,
                                                                         -------------------     -----------------
                                                                           1997       1996         1997      1996
                                                                         ---------  --------     --------  -------
     <S>                                                                 <C>          <C>        <C>      <C>
      Technical Assistance Fees                                          $  3,170   $  3,106     $  9,020 $  8,414
      Equity in Earnings of Unconsolidated Subsidiaries:
            Pipeline Operations                                            13,214      5,890       28,039   22,419

            Power Operations                                                4,600      4,019       13,027   11,676
                                                                         ---------  --------     --------  -------

      Equity in Earnings and Technical Assistance Fees                     20,984     13,015       50,086   42,509
      General and Administrative Expenses                                  (1,449)    (1,304)      (4,728)  (4,215)
      Taxes Other Than Income                                                (173)      (199)        (479)    (492)
      Interest Expense                                                       (446)      (836)      (1,789)    (836)
      Interest Income                                                       1,787      1,328        4,346    2,303
      Other Income (Expense), Net                                          (4,691)        31       (3,227)  (1,825)
                                                                         ---------  --------     --------  -------

      Income Before Income Taxes                                           16,012     12,035       44,209   37,444
      Income Tax (Expense) Benefit                                         (1,159)    (1,150)       1,651   (3,463)
                                                                         ---------  --------     --------  -------
      Net Income                                                           14,853     10,885       45,860   33,981
                                                                         =========  ========     ========  =======

      Net Income Per Common Share                                         $  0.57       0.45     $  1.79   $  1.41
                                                                         =========  ========     ========  =======
      Average Number of Common Shares Used in Computation                  26,020     24,371      25,629    24,141
                                                                         =========  ========     ========  =======
</TABLE>

The accompanying notes are an integral part of these consolidated financial 
statements.


                                       1
<PAGE>   4

                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                    PART I. FINANCIAL INFORMATION (CONTINUED)
                    ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
                           CONSOLIDATED BALANCE SHEETS
                      (IN THOUSANDS, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                            SEPTEMBER 30,  DECEMBER 31,
                                                                1997          1996
                                                            -------------  ------------
                                                             (UNAUDITED)
<S>                                                          <C>           <C>
ASSETS
Current Assets
   Cash and cash equivalents                                   $ 54,262     $ 24,582
   Accounts receivable                                            8,473        6,301
   Dividends receivable                                           7,189           --
   Current portion of notes receivable                            1,470        1,394
   Other current assets                                             336          404
                                                               --------     --------
     Total Current Assets                                        71,730       32,681
                                                               --------     --------

Investments in and Advances to Unconsolidated Subsidiaries      286,340      298,530
Notes Receivable                                                 16,059       12,111
Other                                                               279          521
                                                               --------     --------
      Total Assets                                             $374,408     $343,843
                                                               ========     ========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
   Accounts payable                                            $ 13,461     $ 11,277
   Accrued taxes                                                  1,910        1,488
   Current portion of note payable                                   --       36,583
                                                               --------     --------
     Total Current Liabilities                                   15,371       49,348
                                                               --------     --------
Deferred Income Taxes                                               525        4,301
Notes Payable                                                    18,027       24,750
Commitments and Contingencies (Note 9)
Shareholders' Equity
   Common Shares, no par value,
     200,000,000 shares authorized
     and 26,021,662 and 24,392,352
     shares issued and outstanding, respectively                268,107      219,816
   Retained earnings                                             72,378       45,628
                                                               --------     --------
     Total Shareholders' Equity                                 340,485      265,444
                                                               --------     --------
     Total Liabilities and Shareholders' Equity                $374,408     $343,843
                                                               ========     ========
</TABLE>

The accompanying notes are an integral part of these consolidated financial 
statements.


                                       2
<PAGE>   5

                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                    PART I. FINANCIAL INFORMATION (CONTINUED)
                    ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                             NINE MONTHS ENDED
                                                                               SEPTEMBER  30,
                                                                          -----------------------
                                                                             1997          1996
                                                                          ---------      --------
<S>                                                                      <C>             <C>
Cash Flows From Operating Activities:
Reconciliation of net income to net cash flows from
  operating activities
   Net income                                                             $  45,860      $  33,981
   Equity in earnings of unconsolidated subsidiaries                        (41,066)       (34,095)
   Distributions from unconsolidated subsidiaries                            46,067         34,224
   Deferred income taxes                                                     (3,776)         1,295
   Changes in components of working capital:
     Accounts receivable                                                     (2,172)          (398)
     Accounts payable                                                         2,184          2,172
     Accrued taxes                                                              422           (667)
   Other, net                                                                   310           (939)
                                                                          ---------      ---------
Net Cash Flows from Operating Activities                                     47,829         35,573
                                                                          ---------      ---------

Cash Flows from Investing Activities:
Loan to unconsolidated subsidiary                                            (4,552)            --
Payment of note receivable                                                      528             --
Net investments in and advances to
   unconsolidated subsidiary                                                     --       (117,500)
Proceeds from sale of unconsolidated subsidiary                                  --         39,167
                                                                          ---------      ---------
Net Cash Flows Used in Investing Activities                                  (4,024)       (78,333)
                                                                          ---------      ---------

Cash Flows From Financing Activities:
   Common shares issued                                                      48,291            179
   Loan from parent                                                           9,926             --
   Proceeds from long-term debt                                                  --        117,500
   Payment of long-term debt                                                (53,232)       (56,167)
   Dividends paid                                                           (19,110)       (14,888)
                                                                          ---------      ---------
Net Cash Flows (Used in) Provided by Financing Activities                   (14,125)        46,624
                                                                          ---------      ---------

Increase in Cash and Cash Equivalents                                        29,680          3,864
Cash and Cash Equivalents, Beginning of Period                               24,582         23,364
                                                                          ---------      ---------
Cash and Cash Equivalents, End of Period                                  $  54,262      $  27,228
                                                                          =========      =========

Supplemental Cash Flow Information:
Cash Paid for Income Taxes                                                $   1,620      $   3,045
                                                                          =========      =========
Cash Paid for Interest                                                    $   1,563      $   1,484
                                                                          =========      =========
</TABLE>

The accompanying notes are an integral part of these consolidated financial 
statements.


                                       3
<PAGE>   6

                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                    PART I. FINANCIAL INFORMATION (CONTINUED)
                    ITEM 1. FINANCIAL STATEMENTS (CONTINUED)
           CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
                                 (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                               SHAREHOLDERS' EQUITY
                                                 -----------------------------------------------
                                                   COMMON            RETAINED
                                                   SHARES            EARNINGS            TOTAL
                                                 ----------         ---------         ----------
<S>                                             <C>                 <C>               <C>           
Balance at December 31, 1996                     $  219,816         $  45,628         $  265,444
Net income                                               --            45,860             45,860
Dividends                                                --           (19,110)           (19,110)
Exercise of purchase option by Enron Corp.           47,000                --             47,000
Issuances for share options                           1,291                --              1,291
                                                 ----------         ---------         ----------
Balance at September 30, 1997 (Unaudited)        $  268,107         $  72,378         $  340,485
                                                 ==========         =========         ==========
</TABLE>                                       

The accompanying notes are an integral part of these consolidated financial 
statements.


                                       4
<PAGE>   7
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                    PART I. FINANCIAL INFORMATION (CONTINUED)
                    ITEM 1. FINANCIAL STATEMENTS (CONTINUED)

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION

   Enron Global Power & Pipelines L.L.C., a Delaware limited liability company,
and its wholly owned subsidiaries (EPP), own interests in natural gas pipeline
systems in Argentina and Colombia, two power plants in the Philippines, a power
plant in Guatemala and a power plant in the Dominican Republic. EPP's pipeline
operations in Argentina are conducted through its wholly owned subsidiary, Enron
Pipeline Company -- Argentina S.A. (EPCA). EPCA owns 33 1/3% of Compania de
Inversiones de Energia S.A. (CIESA), which in turn owns 70% of Transportadora de
Gas del Sur S.A. (TGS), the entity that owns the pipeline system. EPP's pipeline
operations in Colombia are conducted through its 49% limited partnership
interest in Centragas -- Transportadora de Gas de la Region Central de Enron
Development & Cia., S.C.A. (Centragas). EPP's power operations in the
Philippines are conducted through its wholly owned subsidiary, Enron Power
Philippines Corp. (EPPC). EPPC owns 50% of the outstanding stock of Subic Power
Corp. (SPC) and Batangas Power Corp. (BPC), the entities that own the respective
power plants. The Guatemala power operations are conducted through EPP's 50%
ownership interest in Puerto Quetzal Power Corp. EPP's Dominican Republic power
operations are conducted through its 50% partnership interest in Smith/Enron
Cogeneration Limited Partnership (SECLP) and Smith/Enron O&M Limited Partnership
(SEOM).

2. ACQUISITIONS

General

   Acquisitions of projects from Enron Corp. or its affiliates (collectively,
Enron) are transactions between entities under common control that are accounted
for similar to the pooling of interests method of accounting using the
historical carryover basis and restating historical results to include the
results of acquired projects. There were no acquisitions during the nine months
ended September 30, 1997.

CIESA

   The acquisition of an additional interest in CIESA from a third party
occurred in July 1996. Detailed below are summarized pro forma results of
operations for EPP as though the acquisition of CIESA had occurred on January 1,
1996.

<TABLE>
<CAPTION>
                                                 THREE MONTHS ENDED       NINE MONTHS ENDED
                                                 SEPTEMBER 30, 1996       SEPTEMBER 30, 1996
                                                 ------------------       ------------------
                                                   (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S>                                              <C>                        <C>
Equity in Earnings and
     Technical Assistance Fees..............     $       13,691             $       46,863
Net Income .................................             11,659                     36,731
Net Income per Common Share.................     $         0.48             $         1.52

</TABLE>

Centragas

During 1996, EPP recorded equity in earnings from Centragas of approximately
$2.8 million related to an early completion bonus. In accordance with the
Transportation Services Contract dated May 12, 1994, between Centragas and
Empresa Colombiana de Petroleos (Ecopetrol), the state-owned oil company of
Colombia, Ecopetrol was obligated to pay to Centragas an early completion bonus
if certain conditions were satisfied. Centragas believed that 


                                       5
<PAGE>   8
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


all of these conditions were satisfied; however, Ecopetrol contested certain
aspects of the early completion bonus. Centragas asserted its claim to such
bonus through an amicable compoundment dispute resolution process whereby an
independent engineering firm, chosen by Centragas and Ecopetrol, would decide
the issue. On June 4, 1997, the independent engineering firm resolved the
dispute in favor of Ecopetrol. As a result of this decision, EPP recorded a $1.9
million net reduction to equity in earnings from Centragas in the first nine
months of 1997.

3. BASIS OF PRESENTATION

   The consolidated financial statements included herein have been prepared by
EPP without audit pursuant to the rules and regulations of the Securities and
Exchange Commission. Accordingly, the consolidated financial statements reflect
all adjustments which are, in the opinion of management, necessary for a fair
presentation of the financial results for the interim periods. Certain
information and notes normally included in financial statements prepared in
accordance with generally accepted accounting principles (GAAP) have been
condensed or omitted pursuant to such rules and regulations. However, EPP
believes that the disclosures are adequate to make the information presented not
misleading. These consolidated financial statements should be read in
conjunction with the consolidated financial statements and the notes thereto
included in EPP's Annual Report on Form 10-K for the year ended December 31,
1996.

   The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from the
estimates.

   EPP records as cash equivalents all highly liquid short-term investments with
original maturities of three months or less. From time to time, EPP invests
excess funds with Enron under promissory notes payable on demand at market
interest rates. At September 30, 1997, approximately $47.6 million was invested
under such notes. Such amounts are classified as cash equivalents.

   All monetary amounts presented in tables herein are expressed in thousands,
except per share amounts.

   Certain prior period amounts have been reclassified to conform with the
current presentation.

4. SHAREHOLDERS' EQUITY

   On March 5, 1997, Enron exercised an option, which was granted to Enron in
connection with Enron providing the financing for the additional EPP interest in
CIESA acquired in July 1996 (the Option) (see Note 2). The Option allowed Enron
to purchase $47.0 million of EPP common shares at the average market price for
the 20 trading days immediately preceding the second trading day prior to the
exercise (approximately 1.6 million EPP common shares). A portion of the
proceeds was used to repay the $36.6 million note payable to Enron (see Note 6).

   On September 15, 1997, EPP paid a quarterly cash dividend of $0.25 per share.

5. INVESTMENTS IN AND ADVANCES TO UNCONSOLIDATED SUBSIDIARIES

   EPP's investments in and advances to unconsolidated subsidiaries and the
changes in such balances are as follows:



                                       6
<PAGE>   9
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

<TABLE>
<CAPTION>
                                  PIPELINE         POWER          TOTAL
                                  --------       ---------      ---------
<S>                               <C>            <C>            <C>
Balance at December 31, 1996      $ 198,204      $ 100,326      $ 298,530
Equity in Earnings                   28,039         13,027         41,066
Distributions Declared               (7,189)            --         (7,189)
Distributions Made                  (37,317)        (8,750)       (46,067)
                                  ---------      ---------      ---------
Balance at September 30, 1997     $ 181,737      $ 104,603      $ 286,340
                                  ---------      ---------      ---------
</TABLE>                         

   At September 30, 1997, EPP's share of undistributed earnings of its pipeline
and power subsidiaries totaled approximately $1.0 million and $25.9 million,
respectively. At September 30, 1997, SECLP had undistributed earnings of $6.8
million and is precluded from making distributions due to arrearages on
principal and interest payments related to the cost overrun loans (COLs) (see
Note 8) and maintenance funding requirements.

   In the first nine months of 1997, EPPC received $7.3 million in dividends
from its Philippine power operations, EPCA received $29.9 million in dividends
from CIESA and EPP received $1.5 million in dividends from its Guatemala power
plant operations. During the first nine months of 1997, Centragas declared
dividends of approximately $29.9 million, approximately $7.4 million of which
was received during the first nine months of 1997 and $7.2 million of which is
expected to be received by EPP incrementally through December 1997. Equity in
earnings are net of amortization of excess investment related to CIESA and
SECLP/SEOM.

6. NOTES PAYABLE

   On March 5, 1997, EPP received $47.0 million in connection with the exercise
of Enron's option to acquire EPP common shares (see Note 4). EPP used a portion
of the proceeds from the exercise of the option to repay the $36.6 million note
payable to Enron.

   In the first nine months of 1997, EPP borrowed $4.6 million from Enron to
loan to SECLP (see Notes 8 and 9).

   In the first nine months of 1997, EPCA repaid $11.3 million of the $24.8
million borrowed from Centragas, predominantly with proceeds from repayment of
loans made to, and a loan from, Enron in the amount of $5.9 million and $5.4
million, respectively (see Note 3).

   On July 22, 1997, EPCA repaid the $5.4 million loan to Enron

7. SUPPLEMENTAL CASH FLOW INFORMATION

   The first nine months of 1996 include the issuance of approximately 3.5
million EPP common shares to Enron in exchange for assets with a carryover basis
totaling $62.5 million related to the acquisitions of Centragas, SECLP and SEOM.
There were no noncash transactions in the first nine months of 1997.

8. NOTES RECEIVABLE

   In the first nine months of 1997, EPP loaned approximately $8.6 million to
Enron in the form of a note receivable. The note bore interest at 5.4% payable
quarterly and was payable on demand. The note was converted to the one-month
London Interbank Offering Rate with principal due on demand and is included in
cash and cash equivalents (see Note 3).

   During the first nine months of 1997, EPP made additional COLs to SECLP in
the amount of $4.6 million for construction-related items (see Note 9). As of
September 30, 1997, the COLs and past due interest payments total in the
aggregate $15.3 million. The COLs, bear interest at 13.5% and are due in
semiannual principal and interest payments through December 15, 2005. As of
September 30, 1997, past due principal and interest on the COLs totaled $1.7
million and $1.6 million, respectively, of the $15.3 million and bear interest
at 15.5%.


                                       7
<PAGE>   10
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


9. COMMITMENTS AND CONTINGENCIES

   EPP and subsidiaries, in the ordinary course of business, are defendants in
various lawsuits and administrative proceedings before various courts and
governmental agencies. Management believes that the final outcome of these
proceedings, individually and in the aggregate, will not have a material adverse
impact on EPP's financial position or results of operations.

Argentina

GdE Request

   TGS received and denied a request from Gas del Estado S.E. (GdE), a company
owned and operated by the Argentine government, for the reimbursement of
approximately $23 million paid by GdE under purchase orders issued for the
construction of two compressor plants. GdE submitted this matter for resolution
to Ente Nacional Regulador del Gas (ENARGAS), the Argentine federal gas
regulatory entity, but ENARGAS concluded that it lacks jurisdiction to
adjudicate the dispute. In April 1996, GdE filed a legal action seeking
reimbursement from TGS of the $23 million. TGS has accrued approximately $4.8
million as property, plant and equipment based on its estimate of construction
costs of similar plants. TGS has thoroughly answered the demand and is defending
the claim.

   TGS has filed a claim against GdE and the Argentine government seeking the
reimbursement of amounts paid by TGS in connection with the registration and
payment of certain easements. On October 7, 1996, the Executive Branch, through
Decree No. 1,136/96, created a contribution fund, as provided for in the license
to transport natural gas through the southern Argentine gas pipeline system
granted to TGS in December 1992, to assume GdE's obligations for paying
easements and any other compensation to land owners for an initial five-year
period, beginning with privatization. ENARGAS has started managing the above
mentioned fund, which is financed by a special charge included in the
transportation rates and reimbursed to ENARGAS. TGS expects to recover the
amounts paid related to such easement. As of September 30, 1997, the total
amount sought by TGS is approximately $3.8 million.

Regulatory Matters

   On July 4, 1997, ENARGAS announced its resolution covering the base natural
gas transportation tariffs of TGS for the five-year period commencing January 1,
1998. The ENARGAS resolution included an up-front, one-time tariff reduction of
6.5% for the efficiency factor and the framework by which TGS will promote and
price future systems expansions. The resolution did not address the investment
factor nor other proposals which could partially mitigate the impact of the rate
reduction.

   Under the Argentine Natural Gas Act, every five years ENARGAS is required to
review the tariffs charged for regulated transportation services with the use of
an incentive tariff methodology. The methodology provides for the derivation of
an efficiency factor and an investment factor. The efficiency factor, which is a
reduction to transporters' base tariff rates, is a sharing mechanism between the
transporters and their customers resulting from specific, quantifiable
efficiencies identified by ENARGAS. The investment factor, which is an increase
to the transporters' base tariff, is a funding mechanism designed to recover the
incremental investment in and return on ENARGAS-approved expansions to be
undertaken by the transporter during the established period. In August 1997, TGS
filed an appeal with and is awaiting the decision from ENARGAS.

   EPP believes that the concepts ENARGAS has applied are inconsistent with the
letter and spirit of the regulatory framework which was intended to encourage
operational efficiencies. TGS has appealed to ENARGAS and requested that ENARGAS
reconsider its resolution, and EPP will continue to work with TGS to evaluate
the resolution and its impact on planned future investments.



                                       8
<PAGE>   11
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


Dominican Republic


   SECLP is currently involved in an International Chamber of Commerce
arbitration proceeding against Corporacion Dominicana de Electricidad (CDE), the
government agency which provides electric services to the Dominican Republic,
and the Dominican Republic Government (DR Government). In SECLP's earlier
pleadings in the arbitration proceedings, SECLP has formally alleged that CDE
owes approximately $19.4 million in past due amounts under the Electric Energy
Supply and Sales Contract dated July 26, 1993, as amended, among SECLP, CDE and
the DR Government (Puerto Plata Energy Supply Contract), a claim which CDE
disputes. SECLP has reserved the right to update its pleadings prior to a final
arbitration hearing date to include the then current amount of the alleged
receivable. As of September 30, 1997, SECLP believes that the total receivable
is approximately $30 million. CDE has alleged that SECLP owes approximately
$13.6 million in delay damages to CDE pursuant to the Puerto Plata Energy Supply
Contract. In addition to CDE's claims, the DR Government has alleged that its
guaranty of CDE's obligations under the Puerto Plata Energy Supply Contract and
the $24 million letter of credit furnished by the DR Government are void because
such commitments were not approved by the Congress of the Dominican Republic. At
the request of the DR Government, the arbitration tribunal has requested that
SECLP refrain from drawing on the letter of credit while the arbitration is
underway. In the arbitration proceeding, SECLP has denied the claims of CDE and
the DR Government and is defending against such claims, which defense includes
the fact that the claim for delay damages was previously waived by CDE and the
DR Government in an earlier contractual undertaking. SECLP believes that it has
strong legal and factual defenses and is vigorously pursuing its claims against,
as well as contesting the claims brought by CDE and the DR Government. SECLP
anticipates a decision by the arbitration panel during the first quarter of
1998. While the arbitration proceeding is ongoing, SECLP and CDE have begun
informal and preliminary discussions to negotiate a settlement of their dispute.
Although no assurances can be given, EPP believes that the ultimate resolution
of this matter will not have a material adverse effect on EPP's financial
position or results of operations.

   On October 5, 1994, Hotelera del Atlantico, S.A. (Hotelera), the owner of a
hotel located near the Puerto Plata Plant in the Dominican Republic (Puerto
Plata Plant), initiated an action (the Lawsuit) against SECLP in the Dominican
Republic, requesting damages in excess of 1.5 billion pesos (approximately $108
million based on a conversion rate of 13.83 pesos/U.S. dollar) and a penalty of
50,000 pesos (approximately $3,600) for each day SECLP continued to operate the
Puerto Plata Plant after the action was initiated. In the Lawsuit, Hotelera
alleged that physical damage and nuisance were caused to the hotel by the
operation of the Puerto Plata Plant prior to December 15, 1994. On December 15,
1994, an agreement between the parties was reached and a settlement agreement
was signed (Settlement Agreement). However, on September 4, 1995, Hotelera filed
a petition with the Dominican Republic Council of Reconciliation and Arbitration
alleging, among other things, that the environmental guidelines of the World
Bank had not been followed by SECLP as agreed to in the Settlement Agreement.
SECLP has no reason to believe that it has not complied with the World Bank
guidelines and is aggressively defending against such claims. While Enron has
agreed to indemnify EPP from any changes in investment value due to the
financial impact to the project of the Hotelera dispute, an adverse decision in
the Hotelera dispute may impact EPP's earnings from SECLP. Although no
assurances can be given, EPP believes that the ultimate resolution of this
matter will not have a material adverse effect on EPP's financial position or
results of operations.

   SECLP, General Electric Company (GE), Raytheon Engineers & Constructors
(Raytheon), Enron Power Construction Company and certain subcontractors and
insurers have been involved in discussions covered by a confidentiality
arrangement relating to claims arising from the design, construction, start-up,
testing and operation of the Puerto Plata Plant. A settlement of claims has been
agreed to between SECLP, GE and Raytheon. While Enron has agreed to indemnify
EPP from any changes in the investment value due to the potential financial
impact of these settlements on the project, the settlements could impact EPP's
earnings from SECLP. Although no assurances can be given, EPP believes that the
ultimate resolutions of these matters will not have a material adverse effect on
EPP's financial position or results of operations.

   Enron is obligated to fund certain amounts to SECLP associated with
construction-related items and other issues. Pursuant to the purchase
arrangement regarding SECLP between subsidiaries of Enron and EPP, if required
to fund 


                                       9
<PAGE>   12
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


such amounts, Enron will loan funds as COLs to SECLP through EPP. The Purchase
Agreement among EPP, Enron International Inc. and Enron Holding Company L.L.C.
dated June 17, 1996, includes provisions that may require an adjustment to the
purchase price by December 31, 1997, depending upon the resolution of certain
contingencies, including the final amount of additional COLs and collection of
certain receivables ($2.8 million) by SECLP from CDE. Any purchase price
adjustments may be settled in EPP common shares or cash. Although no assurances
can be given, EPP believes that the ultimate resolution of this matter will not
have a material adverse effect on EPP's financial position or results of
operations.

Philippines

   At September 30, 1997, BPC had a value added tax (VAT) receivable of
approximately $6.0 million. The realization of the VAT receivable requires the
attainment of VAT exemption from the Bureau of Internal Revenue (BIR), the
Philippine tax authority. BPC received confirmation of VAT exemption through 
BIR ruling No. 43-97 dated May 15, 1997. EPP believes that the VAT receivable 
will be realized either as a credit against future tax liabilities or a refund 
from the BIR and/or National Power Corporation, the primary electric power 
supplier in the Philippines, and that the full amount of the VAT receivable
will be recovered.

10. DEFERRED INCOME TAXES

   During the first nine months of 1997, EPP reversed a reserve of approximately
$4.0 million for certain Philippine withholding taxes based upon the repeal of a
U.S. tax law which enabled EPP to alter its tax planning strategies. Under the
new strategies, EPP believes that such cash will ultimately be received without
incurring such withholding taxes and, accordingly, management believes that a
liability for such withholding taxes is no longer required.

11. OTHER INCOME (EXPENSE), NET

   For the three and nine months ended September 30, 1997, other income
(expense), net, included losses of $3.5 million and $2.1 million, respectively,
recognized from forward contracts used to mitigate foreign exchange risk in
Colombia (see Note 12) and losses of $1.2 million and $1.1 million,
respectively, recognized on foreign currency exchange.

12. DERIVATIVE FINANCIAL INSTRUMENTS

   During the first nine months of 1997, EPP entered into forward purchase
contracts (Contracts) on Colombian pesos with a notional value of $24.6 million
scheduled to settle between late 1997 and early 1998. EPP entered into these
Contracts to offset potential fluctuations in planned equity earnings from
Centragas resulting from changes in the peso exchange rate. Such changes can
cause U.S. GAAP income to vary by impacting Colombian tax expense and foreign
exchange gains or losses on peso-denominated monetary assets and liabilities.
These Contracts do not hedge specific transactions, assets or liabilities and,
accordingly, are marked to market with gains or losses reported as other income
(expense), net. Gains or losses on the termination, sale or maturity of these
Contracts will be reported as other income (expense), net. These Contracts
generated approximately $3.5 million and $2.1 million of expense during the
three months and nine months ended September 30, 1997, which is included in
other income (expense), net.

13. EARNINGS PER SHARE

   In February 1997,  the Financial  Accounting  Standards  Board (FASB) 
issued Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings
per Share" effective for interim and annual periods beginning after December
15, 1997. This statement replaces primary earnings per share (EPS) with a newly
defined basic EPS and modifies the computation of diluted EPS. EPP's basic and
diluted EPS computed using the requirements of SFAS No. 128 are the same as the
currently disclosed primary EPS amounts. 


                                       10
<PAGE>   13
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED


14. PROPOSED MERGER

   On August 18, 1997, Enron and EPP agreed to a merger whereby Enron would
purchase all outstanding EPP common shares not already owned by Enron. Under the
proposal, the shareholders of EPP other than Enron would receive Enron Corp.
common stock having a market value (based on the average trading price of Enron
Corp. common stock for a 20 trading day period prior to the completion of the
merger) of $35 per share. The merger proposal has been sent to, and will be
submitted to a vote at a meeting of, the EPP shareholders, which meeting is
scheduled for November 18, 1997.

   A lawsuit has been filed by one of EPP's shareholders seeking to enjoin the
merger with Enron, a copy of such petition is attached hereto as Exhibit 99.1.
The lawsuit, which was served on EPP on November 10, 1997, seeks recovery of
unspecified damages and rescission of the merger if it is not enjoined. The
lawsuit purports to be filed as a class action on behalf of all holders of EPP
common shares against Enron, Enron International Merger L.L.C., EPP, and each of
the directors of EPP. The suit alleges, among other things, that the directors
of EPP breached their duties to EPP shareholders by approving the merger
agreement and recommending that it be adopted by EPP's shareholders, that the
merger price is unfair, that the members of the Oversight Committee (composed of
the three non-Enron affiliated directors of EPP), which approved the merger,
were not independent and that Enron used its majority ownership of EPP to
unfairly dominate the merger process for its own benefit. EPP and Enron believe
that the lawsuit is without merit and does not take into consideration the
lengthy and careful arm's length negotiating process which led to the approval
of the merger agreement by a unanimous vote of EPP's independent Oversight
Committee. EPP and Enron intend to vigorously defend against the allegations in
the litigation.


                                       11
<PAGE>   14
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                    PART I. FINANCIAL INFORMATION (CONTINUED)
                 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

PRIMARY ASSETS AND SOURCES OF EARNINGS AND CASH

   The primary assets of Enron Global Power & Pipelines L.L.C. ("EPP"), a
Delaware limited liability company which is approximately 52% owned by Enron
Corp. (together with its subsidiaries, "Enron") at September 30, 1997, are its
interests in 50% or less owned companies ("Project Companies"), which it holds
directly or indirectly through wholly owned subsidiaries. EPP accounts for its
interests in the Project Companies under the equity method of accounting and
records its proportionate share of the earnings or losses of the Project
Companies. The operations of the Project Companies are EPP's primary source of
earnings. EPP also receives technical assistance fees, paid by Project Companies
to certain wholly owned subsidiaries of EPP, primarily by Transportadora de Gas
del Sur S.A. ("TGS") to Enron Pipeline Company -- Argentina S.A. ("EPCA").
Dividends paid by the Project Companies are EPP's primary source of cash.
Declaration and payment of such dividends are at the sole discretion of the
boards of directors of the Project Companies and are subject to certain
restrictions, including, among others, each Project Company's operating
profitability, restrictions on the distribution of cash under applicable credit
agreements and government imposed currency restrictions. See "Liquidity and
Capital Resources of EPP -- Primary Sources of Cash" for further discussion
regarding sources of cash.

RESULTS OF OPERATIONS OF EPP

GENERAL

   For the nine months ended September 30, 1997, EPP's equity in earnings and
technical assistance fees from its Argentine and Philippine operations
constituted approximately 63% and 17%, respectively, of EPP's equity in earnings
and technical assistance fees. As of September 30, 1997, Argentine and
Philippine assets accounted for approximately 49% and 20%, respectively, of
EPP's assets. As a result, if the Argentine or Philippine operations were
materially and adversely affected, EPP's financial condition and results of
operations could be materially and adversely affected. See "Pipeline Operations"
and "Power Operations" below for the results of operations of EPP's Project
Companies.

   Acquisitions of projects from Enron are transactions between entities under
common control that are accounted for similar to the pooling of interests method
of accounting using the historical carryover basis and restating historical
results to include the results of acquired projects. There were no acquisitions
during the nine months ended September 30, 1997.

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 VS. THE 
THREE MONTHS ENDED SEPTEMBER 30, 1996

   EQUITY IN EARNINGS AND TECHNICAL ASSISTANCE FEES. Equity in earnings and
technical assistance fees increased $8.0 million (61%) in the third quarter of
1997 compared to the third quarter of 1996. The increase is primarily due to
increased earnings in Centragas -- Transportadora de Gas de la Region Central de
Enron Development & Cia., S.C.A. ("Centragas"), the entity that owns the
Colombian pipeline, attributable to increased net foreign exchange gains and
lower income tax expense related to the devaluation of the Colombian peso (see
"OTHER INCOME (EXPENSE), NET" below for discussion regarding the use of forward
contracts to mitigate foreign exchange risk). Additionally, equity in earnings
and technical assistance fees increased from the increased ownership in Compania
de Inversiones de Energia S.A. ("CIESA"), the Argentine company through which
EPP owns its interest in TGS.


                                       12
<PAGE>   15
   GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased $0.1 million (11%) during the third quarter of 1997 compared to the
third quarter of 1996, primarily as a result of the expiration of an agreement
requiring reimbursement of certain expenses.

   INTEREST EXPENSE. Interest expense decreased $0.4 million (47%) during the
third quarter of 1997 compared to the third quarter of 1996, primarily due to
the decreased debt balance resulting from the March 1997 repayment of the note
payable to Enron incurred in obtaining the additional ownership of CIESA in July
1996 and the June 1997 repayment of the note payable to Centragas (see Note 6 to
EPP's financial statements and notes thereto). This decrease was partially
offset by an increase in interest expense attributable to the debt with Enron
related to the Dominican Republic cost overrun loans ("COLs") (see Note 6 to
EPP's financial statements and notes thereto).

   INTEREST INCOME. Interest income increased $0.5 million (35%) during the
third quarter of 1997 compared to the third quarter of 1996, primarily due to
interest earned from the COLs and increased cash balances invested with Enron
(see Note 8 to EPP's financial statements and notes thereto).

   OTHER INCOME (EXPENSE), NET. Other income (expense), net, represented expense
of $4.7 million for the third quarter of 1997 and was negligible for the third
quarter of 1996. The $4.7 million of expense in 1997 was primarily attributable
to losses recognized from forward contracts used to mitigate foreign exchange
risk in Colombia ($3.5 million) (see Note 12 to EPP's financial statements and
notes thereto and "EQUITY IN EARNINGS AND TECHNICAL ASSISTANCE FEES" above) and
on foreign currency exchange ($1.2 million).

   INCOME TAX (EXPENSE) BENEFIT. The income of EPP is not taxable to EPP;
however, EPCA and Enron Power Philippines Corp. ("EPPC"), both wholly owned
subsidiaries of EPP, are taxable entities in their respective local
jurisdictions. The effective tax rate paid by these subsidiaries is less than
the statutory rate because a majority of the income of these subsidiaries
relates to ownership of equity investments, which is not subject to tax;
however, EPCA is subject to taxes (currently 33%) primarily on the technical
assistance fees received from TGS, net of interest expense. Dividends paid to
EPP from Centragas are subject to certain withholding taxes of 7%.

   Income tax expense  remained  relatively  unchanged from the third quarter 
of 1996 compared to the third quarter of 1997.

RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 VS. THE NINE 
MONTHS ENDED SEPTEMBER 30, 1996

   EQUITY IN EARNINGS AND TECHNICAL ASSISTANCE FEES. Equity in earnings and
technical assistance fees increased $7.6 million (18%) in the first nine months
of 1997 compared to the first nine months of 1996. The increase is primarily due
to the earnings resulting from the increased ownership in CIESA and increased
earnings in the Philippines. The increased earnings in the Philippines are
primarily attributable to increased revenues due to more efficient operations
and reduced maintenance costs. An increase in equity in earnings from Centragas
primarily attributable to the net foreign exchange gains and lower income tax
expense from Colombian peso devaluation was primarily offset by the reversal of
the early completion bonus from the unfavorable amicable compoundment decision
(see Note 2 to EPP's financial statements and notes thereto).

   GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased $0.5 million (12%) for the first nine months of 1997 compared to the
first nine months of 1996, primarily as a result of the expiration of an
agreement requiring reimbursement of certain expenses.

   INTEREST EXPENSE. Interest expense increased $1.0 million (114%) for the
first nine months of 1997 compared to the first nine months of 1996, primarily
due to interest expense associated with the debt incurred in obtaining the
additional ownership of CIESA in July 1996 and the debt with Enron related to
the COLs (see Note 6 to EPP's financial statements and notes thereto).


                                       13
<PAGE>   16
   INTEREST INCOME. Interest income increased $2.0 million (89%) for the first
nine months of 1997 compared to the first nine months of 1996, primarily due to
interest earned from the COLs and increased cash balances invested with Enron
(see Note 8 to EPP's financial statements and notes thereto).

   OTHER INCOME (EXPENSE), NET. Other income (expense), net, represented expense
of $3.2 million and $1.8 million for the first nine months of 1997 and 1996,
respectively. The $1.4 million of additional expense was primarily attributable
to losses recognized from forward contracts used to mitigate foreign exchange
risk in Colombia ($2.1 million) (see Note 12 to EPP's financial statements and
notes thereto and "EQUITY IN EARNINGS AND TECHNICAL ASSISTANCE FEES" above) and
on foreign currency exchange ($1.1 million) partially offset by the acquisition
costs incurred for the Colombia and the Dominican Republic projects ($1.8
million) during the first nine months of 1996.

   INCOME TAX (EXPENSE) BENEFIT. Income taxes decreased $5.1 million for the
first nine months of 1997 compared to the first nine months of 1996, primarily
due to the one-time reversal of $4.0 million related to a reserve for certain
Philippine withholding taxes and the elimination of accrued Philippine
withholding taxes after the one-time reversal in the first quarter of 1997 based
upon the repeal of a U.S. tax law which enabled EPP to alter its tax planning
strategies. Under the new strategies, EPP believes that such cash will
ultimately be received without incurring these withholding taxes and,
accordingly, management believes that a liability for these withholding taxes is
no longer required.

LIQUIDITY AND CAPITAL RESOURCES OF EPP

PRIMARY CASH REQUIREMENTS

   The primary cash requirements of EPP include the payment of dividends to its
shareholders and the payment of general and administrative expenses, including
salaries, overhead, debt service obligations and costs incurred under the
Administrative Services and Cost Sharing Agreements between Enron and EPP. EPP
may also use cash to satisfy its payment obligations, if any, under various
shareholder and credit agreements relating to the Project Companies and under a
Master Contribution Agreement among EPP, Enron and certain of their subsidiaries
(the "Contribution Agreement"). Pursuant to the Contribution Agreement, Enron
maintains certain commitments on behalf of EPP for the benefit of certain
Project Companies, as required by project lenders and certain other third
parties. In most instances, EPP has agreed to indemnify Enron against
liabilities that may be incurred under such commitments. Although these
indemnity obligations could result in certain otherwise nonrecourse liabilities
becoming recourse to EPP, EPP believes the events which would trigger liability
are remote, and therefore does not expect these obligations to create any
additional liability. If, however, EPP were required to make significant
payments to Enron under the Contribution Agreement, EPP believes it would have
adequate cash resources, would be able to obtain financing for such payments
from Enron or other sources or would be able to cause its subsidiaries to pay to
EPP cash dividends sufficient to make such payments. However, there can be no
assurance that sufficient cash, dividends or funds from other sources would be
available for such purpose.

   On September 15, 1997, EPP paid a quarterly dividend of approximately $6.5
million, or $0.25 per share.

PRIMARY SOURCES OF CASH

   Primary sources of cash for EPP consist of cash on hand, dividends from the
Project Companies, technical assistance fees and long-term loans of project cash
balances which are currently restricted by local regulations from being declared
as dividends. The ability of the Project Companies to pay dividends will be
dependent on the future earnings and debt repayment obligations of such
subsidiaries, dividend restrictions included in credit agreements at the project
level, applicable currency restrictions, income and other taxes, applicable laws
and the declaration of dividends by the boards of directors of each of the
Project Companies. Project financings typically require that certain cash
reserves be established at each Project Company and that certain additional
capital and legal requirements be satisfied before the Project Company may pay
dividends to its shareholders. However, each of EPP's subsidiaries has a stated
dividend policy, set forth in its shareholders agreement, of maximizing
after-tax cash distributions to shareholders after taking into consideration
capital requirements and applicable legal requirements. 


                                       14
<PAGE>   17
In the future, the Project Companies may also borrow funds or otherwise accept
encumbrances on their earnings resulting in further possible constraints on
their ability to pay dividends to EPP.

   On March 5, 1997, EPP received $47.0 million in connection with the exercise
by Enron of its option to acquire EPP common shares ("Common Shares"). EPP used
a portion of the proceeds from this option exercise to repay a $36.6 million
note payable to Enron.

   In the first nine months of 1997, EPP loaned approximately $8.6 million to
Enron in the form of a note receivable. The note bore interest at 5.4% payable
quarterly and was payable on demand. The note was converted to the one-month
London Interbank Offering Rate ("LIBOR") with principal due on demand and is
included in cash and cash equivalents (see Note 3 to EPP's financial statements
and notes thereto).

   During the first nine months of 1997, EPP made additional COLs to Smith/Enron
Cogeneration Limited Partnership ("SECLP") in the amount of $4.6 million for
project-related items. As of September 30, 1997, the COLs and past due interest
payments total in the aggregate $15.3 million. The COLs bear interest at 13.5%
and are due in semiannual principal and interest payments through December 15,
2005. As of September 30, 1997, past due principal and interest on the COLs
totaled $1.7 million and $1.6 million, respectively, of the $15.3 million and
bear interest at 15.5%.

   In the first nine months of 1997, Subic Power Corp. ("Subic") and Batangas
Power Corp. ("Batangas") paid $3.0 million and $11.5 million in dividends,
respectively, of which EPPC received approximately $7.3 million. EPCA received
approximately $29.9 million in dividends from CIESA in the first nine months of
1997. EPP received approximately $1.5 million in dividends from Puerto Quetzal
Power Corp. ("PQPC") in the first nine months of 1997. During the first nine
months of 1997, Centragas declared dividends of approximately $29.9 million,
approximately $7.4 million of which was received during the first nine months of
1997 and $7.2 million of which is expected to be received by EPP incrementally
through December 1997. SECLP and Smith/Enron O&M Limited Partnership ("SEOM")
paid no dividends during the first nine months of 1997 (see Note 5 to EPP's
financial statements and notes thereto).

LONG-TERM FINANCING POLICY

   EPP's business strategy is to generate long-term growth in earnings per
share, dividends and cash flow by acquiring interests in additional power and
natural gas pipeline projects from Enron and third parties. EPP currently
expects to fund any such acquisitions from Enron by issuing additional Common
Shares and to fund acquisitions from third parties with Common Shares, cash or
debt. EPP believes that it will have sufficient cash to meet its obligations for
the foreseeable future.

RECENT EVENTS

   On August 18, 1997, Enron and EPP agreed to a merger whereby Enron would
purchase all outstanding EPP common shares not already owned by Enron. Under the
proposal, the shareholders of EPP other than Enron would receive Enron Corp.
common stock having a market value (based on the average trading price of Enron
Corp. common stock for a 20 trading day period prior to the completion of the
merger) of $35 per share. The merger proposal has been sent to, and will be
submitted to a vote at a meeting of, the EPP shareholders, which meeting is
scheduled for November 18, 1997.

   A lawsuit has been filed by one of EPP's shareholders seeking to enjoin the
merger with Enron, a copy of such petition is attached hereto as Exhibit 99.1.
The lawsuit, which was served on EPP on November 10, 1997, seeks recovery of
unspecified damages and rescission of the merger if it is not enjoined. The
lawsuit purports to be filed as a class action on behalf of all holders of EPP
common shares against Enron, Enron International Merger L.L.C., EPP, and each of
the directors of EPP. The suit alleges, among other things, that the directors
of EPP breached their duties to EPP shareholders by approving the merger
agreement and recommending that it be adopted by EPP's shareholders, that the
merger price is unfair, that the members of the Oversight Committee (composed of
the three non-Enron affiliated directors of EPP), which approved the merger,
were not independent and that Enron used its 


                                       15
<PAGE>   18
majority ownership of EPP to unfairly dominate the merger process for its own
benefit. EPP and Enron believe that the lawsuit is without merit and does not
take into consideration the lengthy and careful arm's length negotiating process
which led to the approval of the merger agreement by a unanimous vote of EPP's
independent Oversight Committee. EPP and Enron intend to vigorously defend
against the allegations in the litigation.

PIPELINE OPERATIONS

   Equity in earnings of the pipeline operations represents EPP's 331/3%
interest in CIESA (increased from 25% on July 31, 1996), which owns 70% of TGS,
and EPP's 49% interest in Centragas, which EPP acquired in May 1996 and which
began full commercial operation in February 1996. See "Results of Operations of
EPP -- General."

   RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 VS. 
THE THREE MONTHS ENDED SEPTEMBER 30, 1996

   Presented below is a summary of income statement  information for the 
combined pipeline operations of CIESA and Centragas for the third quarter of
1997 and 1996 on a U.S. Generally Accepted Accounting Principles ("GAAP"),
historical U.S. dollar, 100% basis. See "Results of Operations of EPP --
General."

<TABLE>
<CAPTION>
                                                          THREE MONTHS ENDED
                                                             SEPTEMBER 30,
                                                      ------------------------
                                                        1997           1996
                                                      ---------      ---------
                                                            (IN THOUSANDS)
<S>                                                         <C>            <C>
Gas transportation revenues                           $ 104,823      $ 106,018
Gas processing revenues                                  13,501         12,055
                                                      ---------      ---------
  Total Revenues                                        118,324        118,073
Operating, administrative and selling expenses          (35,892)       (33,102)
Interest income                                           1,846          1,577
Interest expense, net of capitalized interest           (21,406)       (21,792)
Other income (expense)                                      647           (584)
                                                      ---------      ---------
  Income Before Minority Interest and Income Taxes       63,519         64,172
Minority interest                                       (12,319)       (11,200)
Income tax expense                                      (17,179)       (33,072)
                                                      ---------      ---------
  Net Income                                          $  34,021      $  19,900
                                                      =========      =========
EPP's Equity in Earnings of Pipeline Operations       $  13,214      $   5,890
                                                      =========      =========
</TABLE>

   GAS TRANSPORTATION REVENUES. Transportation revenues decreased $1.2 million
(1%) for the third quarter of 1997 compared to the third quarter of 1996.
Transportation revenues of Centragas decreased $0.6 million during the third
quarter of 1997 primarily as a result of a 5% decrease in the tariff rate.
Transportation revenues at TGS decreased $0.6 million during the third quarter
of 1997 primarily as a result of lower interruptible volumes from warmer weather
conditions.

   GAS PROCESSING REVENUES. During the third quarter of 1997 as compared to the
third quarter of 1996, processing revenues increased by $1.4 million (12%)
primarily due to increased prices and volumes of natural gas liquids. Improved
operating efficiencies in Argentina during the first quarter of 1997 provided
the increased volume of natural gas liquids. Centragas does not generate any
processing revenues.

   OPERATING, ADMINISTRATIVE AND SELLING EXPENSES. Operating, administrative and
selling expenses increased $2.8 million (8%) for the third quarter of 1997
compared to the third quarter of 1996. Operating, administration and selling
expenses increased $1.5 million at Centragas for the third quarter of 1997
primarily due to increased maintenance costs and expenses associated with the
amicable compoundment procedures (see Note 2 to EPP's financial statements and
notes thereto). Operating, administrative and selling expenses increased $1.3
million at TGS for the third quarter of 1997 primarily due to higher
depreciation expense resulting from a capital expenditure program and increased
fees to ENARGAS, partially offset by reductions in labor costs resulting from
operating efficiencies.


                                       16
<PAGE>   19
   INTEREST INCOME. Interest income increased $0.3 million (17%) for the third
quarter of 1997 compared to the third quarter of 1996, primarily due to the
increase in interest income at Centragas resulting from loans made to
affiliates. This increase was partially offset by the decrease in interest
income at TGS and CIESA primarily due to lower average short-term investment
balances and lower interest rates.

   INTEREST EXPENSE, NET OF CAPITALIZED INTEREST. Interest expense, net of
capitalized interest, decreased $0.4 million (2%) for the third quarter of 1997
compared to the third quarter of 1996, primarily due to decreases at TGS and
CIESA. The decrease in interest expense, net of capitalized interest, at TGS and
CIESA for the third quarter of 1997 was primarily a result of lower interest
rates at CIESA from debt refinancing (see "Liquidity and Capital Resources of
Pipeline Operations") and increased capitalized interest at TGS from increased
capital expenditures.

   INCOME TAX EXPENSE. The statutory tax rate in Argentina is 33% of taxable net
income, calculated according to Argentine tax regulations which differ in
certain respects from accounting practices followed under Argentine GAAP for the
preparation of financial statements. The statutory tax rate in Colombia is 35%
of taxable net income, calculated according to Colombian tax regulations. The
effective tax rate for Centragas differs from the statutory tax rate primarily
due to the taxable effects of inflation and foreign currency exchange
fluctuations under Colombian tax regulations, which are eliminated for U.S. GAAP
reporting. Fluctuations in the value of the Colombian peso will result in
increases or decreases in local income taxes.

   Income tax expense decreased $15.9 million (48%) for the third quarter of
1997 compared to the third quarter of 1996. Income tax expense decreased at
Centragas ($9.2 million) for the third quarter of 1997 primarily due to the
income tax benefits related to the devaluation of the Colombian peso. Income tax
expense decreased at CIESA ($6.7 million) for the third quarter of 1997
primarily due to the recognition of the cumulative impact of the retroactive
income tax rate increase from 30% to 33% in the third quarter of 1996.

RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 VS. THE NINE 
MONTHS ENDED SEPTEMBER 30, 1996

   Presented below is a summary of income statement  information for the 
combined pipeline operations of CIESA and Centragas for the first nine months of
1997 and 1996 on a U.S. GAAP, historical U.S. dollar, 100% ownership basis. See
"Results of Operations of EPP -- General."

<TABLE>
<CAPTION>                                             
                                                          NINE MONTHS ENDED
                                                             SEPTEMBER 30,
                                                      ------------------------
                                                        1997           1996
                                                      ---------      ---------
                                                           (IN THOUSANDS)
<S>                                                   <C>            <C>
Gas transportation revenues                           $ 307,187      $ 311,982
Gas processing revenues                                  36,263         34,780
                                                      ---------      ---------
  Total Revenues                                        343,450        346,762
Operating, administrative and selling expenses         (101,974)       (99,440)
Interest income                                           4,754          4,940
Interest expense, net of capitalized interest           (63,315)       (64,374)
Other income                                                875            375
                                                      ---------      ---------
  Income Before Minority Interest and Income Taxes      183,790        188,263
Minority interest                                       (37,373)       (36,481)
Income tax expense                                      (64,441)       (74,623)
                                                      ---------      ---------
  Net Income                                          $  81,976      $  77,159
                                                      =========      =========
EPP's Equity in Earnings of Pipeline Operations       $  28,039      $  22,419
                                                      =========      =========
</TABLE>

   GAS TRANSPORTATION REVENUES. Transportation revenues decreased $4.8 million
(2%) for the first nine months of 1997 compared to the first nine months of
1996. Transportation revenues at Centragas decreased $11.1 million during the
first nine months of 1997 primarily as a result of the reversal of the early
completion bonus 

                                       17
<PAGE>   20
recorded in the first nine months of 1996 (see Note 2 to EPP's financial
statements and notes thereto) and a 5% decrease in the tariff rate.
Transportation revenues at TGS increased $6.3 million during the first nine
months of 1997 primarily as a result of the extension of certain firm
transportation agreements and the 1.5% increase in tariff rates effective July
1, 1996.

   GAS PROCESSING REVENUES. During the first nine months of 1997 as compared to
the first nine months of 1996, processing revenues at TGS increased by $1.5
million (4%) primarily due to increased interruptible volumes and higher prices.
Improved operating efficiencies provided the increased volume of natural gas
liquids.

   OPERATING, ADMINISTRATIVE AND SELLING EXPENSES. Operating, administrative and
selling expenses increased $2.5 million (3%) during the first nine months of
1997 compared to the first nine months of 1996, primarily due to an increase at
Centragas. Operating, administrative and selling expenses increased at Centragas
during the first nine months of 1997 primarily due to a full period of
commercial operations during 1997 versus 1996 in which commercial operations
commenced on February 24, 1996. Additionally, during the first nine months of
1997, operating, administrative and selling expenses at Centragas increased due
to increased maintenance costs and expenses associated with the amicable
compoundment procedures (see Note 2 to EPP's financial statements and notes
thereto). Operating, administrative and selling expenses remained relatively
unchanged at CIESA for the first nine months of 1997.

   INTEREST INCOME. Interest income decreased $0.2 million (4%) during the first
nine months of 1997 compared to the same period in 1996. Interest income at TGS
and CIESA decreased $2.4 million during the first nine months of 1997 primarily
due to lower average short-term investment balances and lower interest rates at
TGS and CIESA. This decrease was partially offset by an increase in interest
income at Centragas ($2.2 million) primarily attributable to loans made to
affiliates.

   INTEREST EXPENSE, NET OF CAPITALIZED INTEREST. Interest expense, net of
capitalized interest, decreased $1.1 million (2%) for the first nine months of
1997 compared to the first nine months of 1996. Interest expense, net of
capitalized interest, decreased $1.8 million at TGS and CIESA during the first
nine months of 1997 primarily due to lower interest rates and increased
capitalized interest from increased capital expenditures. Interest expense, net
of capitalized interest, increased $0.7 million at Centragas during the first
nine months of 1997 primarily as a result of a full period of commercial
operations during 1997 versus 1996 in which commercial operations commenced on
February 24, 1996.

   INCOME TAX EXPENSE. Income tax expense in the first nine months of 1997
decreased $10.2 million (14%) compared to the first nine months of 1996. Income
tax expense decreased at Centragas ($11.0 million) primarily due to the income
tax benefit associated with the devaluation of the Colombian peso and the
reversal of the early completion bonus (see Note 2 to EPP's financial statements
and notes thereto). Income tax expense increased at CIESA ($0.8 million)
primarily due to the increase in taxable income.


LIQUIDITY AND CAPITAL RESOURCES OF PIPELINE OPERATIONS

   As of September 30, 1997, TGS had access to approximately $300 million under
a global program to issue up to $500 million of debt securities. In addition,
TGS had access to $200 million of debt securities under a shelf registration
statement filed with the Securities and Exchange Commission during 1996.

   In January and February 1997, the board of directors and shareholders of TGS,
respectively, approved the creation of a new global program for the issuance of
short-term debt securities for a maximum amount of $150 million. As of September
30, 1997, TGS had $150 million outstanding at 5.8% under these issuances, which
have been classified as long-term debt since TGS has the ability to and intends
to refinance these securities throughout the five-year term of the new global
program with existing borrowing facilities.


                                       18
<PAGE>   21

   On April 22, 1997, CIESA issued a five-year $220 million debt security at the
three-month LIBOR plus 2% for the first two years, stepping up to LIBOR plus
2.7% thereafter. CIESA used these proceeds to retire a $220 million bridge
credit facility.

   TGS believes that cash flows from operations supplemented with external debt
financing will provide sufficient liquidity to fund its capital expenditures,
pay dividends, cover its debt service and provide sufficient working capital.

   As of September 30, 1997, CIESA's total capitalization amounted to $1.5
billion. Total capitalization was comprised of debt of $921 million,
shareholders' equity of $355 million and minority interest of $261 million. Debt
as a percentage of total capitalization increased from 55% at December 31, 1996,
to 60% at September 30, 1997.

   Future capital expenditures for Centragas are expected to be minimal.
Centragas expects to meet cash requirements using cash flows from operations.


RECENT EVENTS

   On July 4, 1997, ENARGAS announced its resolution covering the base natural
gas transportation tariffs of TGS for the five-year period commencing January 1,
1998. The ENARGAS resolution included an up-front, one-time tariff reduction of
6.5% for the efficiency factor and the framework by which TGS will promote and
price future systems expansions. The resolution did not address the investment
factor nor other proposals which could partially mitigate the impact of the rate
reduction. In August 1997, TGS filed an appeal with and is awaiting the decision
from ENARGAS (see Note 9 to EPP's financial statements and notes thereto).

   TGS is presently analyzing various options that could mitigate the negative
impact of the rate reduction. Accordingly, the final impact of the ENARGAS
resolution on the future revenues and net income of TGS has not been determined.

POWER OPERATIONS

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 VS. THE 
THREE MONTHS ENDED SEPTEMBER 30, 1996

   Presented below is a summary of income statement information for the combined
power operations of the Philippine power plants located in Subic Bay ("Subic
Plant") and Batangas ("Batangas Plant") with the Puerto Quetzal Plant in
Guatemala ("Puerto Quetzal Plant") and the Puerto Plata Plant in the Dominican
Republic ("Puerto Plata Plant") for the third quarter of 1997 and 1996 on a U.S.
GAAP, historical U.S. dollar, 100% ownership basis. See "Results of Operations
of EPP -- General."


                                       19
<PAGE>   22

<TABLE>
<CAPTION>                                             
                                                         THREE MONTHS ENDED
                                                            SEPTEMBER 30,
                                                      ----------------------
                                                        1997          1996
                                                      --------      --------
                                                           (IN THOUSANDS)
<S>                                                  <C>           <C>
Capacity revenues                                     $ 33,203      $ 33,765
Variable revenues                                       23,750        19,330
                                                      --------      --------
   Total Revenues                                       56,953        53,095
Fuel cost                                              (18,197)      (14,825)
Operating and administrative expenses                  (10,090)      (10,334)
Depreciation and amortization expense                   (8,720)       (9,040)
                                                      --------      --------
   Net Operating Income                                 19,946        18,896
Interest expense, net                                   (9,360)       (9,025)
Other expense, net                                        (327)         (955)
                                                      --------      --------
   Income Before Income Taxes                           10,259         8,916
Income tax expense                                        (741)         (711)
                                                      --------      --------
   Net Income                                         $  9,518      $  8,205
                                                      ========      ========
EPP's Equity in Earnings of Power Operations          $  4,600      $  4,019
                                                      ========      ========
</TABLE>

   REVENUES. A significant portion of each Project Company's revenue is
attributable to payments tied to the capacity of the respective plant, whether
on annual availability (the Subic and Batangas Plants) or an annual capacity
test (the Puerto Quetzal and Puerto Plata Plants). Capacity revenues decreased
$0.6 million (2%) for the third quarter of 1997 compared to the third quarter of
1996, primarily due to the decrease at the Subic Plant ($0.9 million) partially
offset by increases at the Puerto Quetzal Plant ($0.2 million) and the Puerto
Plata Plant ($0.1 million). The decrease in capacity revenues at the Subic Plant
for the third quarter of 1997 was primarily attributable to revenue from a
business interruption insurance claim recognized in the third quarter of 1996.

   The second type of payment, an energy fee, varies directly with actual output
and, under the current cost structures of the plants, essentially covers
variable costs. Total variable revenues increased $4.4 million (23%) in the
third quarter of 1997 compared to the third quarter of 1996. Variable revenues
increased at the Puerto Quetzal Plant ($2.4 million) and at the Puerto Plata
Plant ($2.0 million) for the third quarter of 1997, primarily due to increased
output. Variable revenues remained relatively unchanged for the third quarter of
1997 at the Subic and Batangas Plants.

   FUEL COST. Fuel cost is the expense for the fuel burned at the Puerto Quetzal
and Puerto Plata Plants. An Enron affiliate supplies fuel to these plants at
market-based rates. Total fuel cost increased $3.4 million (23%) for the third
quarter of 1997 compared to the third quarter of 1996. Fuel cost at the Puerto
Plata and Puerto Quetzal Plants increased $1.7 and $1.7 million, respectively,
for the third quarter of 1997, primarily due to the increased output discussed
above partially offset by lower fuel prices. Fuel is provided to the Subic and
Batangas Plants by their customer, National Power Corporation, at no cost to
these plants.

   OPERATING AND ADMINISTRATIVE EXPENSES. Operating and administrative expenses
decreased $0.2 million (2%) in the third quarter of 1997 compared to the third
quarter of 1996. The decrease was primarily due to decreased operating and
administrative expenses of the Batangas Plant ($0.5 million) and the Subic Plant
($0.3 million), primarily attributable to lower maintenance costs. These
decreases were partially offset by the increase in operating and administrative
expenses at the Puerto Plata Plant ($0.6 million) for the third quarter of 1997,
primarily due to increased legal fees associated with the arbitration with
Corporacion Dominicana de Electricidad ("CDE"), the government agency which
provides electric services to the Dominican Republic (see Note 9 to EPP's
financial statements and notes thereto), and maintenance costs.

   DEPRECIATION AND AMORTIZATION EXPENSE. Depreciation and amortization expense
decreased $0.3 million (4%) in the third quarter of 1997 compared to the third
quarter of 1996. The decrease was due primarily to lower depreciation and
amortization expense at the Puerto Plata Plant ($0.2 million) and the Batangas
Plant ($0.1 million).


                                       20
<PAGE>   23
   INTEREST EXPENSE, NET. Interest expense, net, increased $0.3 million (4%) in
the third quarter of 1997 compared to the third quarter of 1996. Interest
expense, net, increased at the Puerto Plata Plant ($0.7 million) for the third
quarter of 1997 primarily due to increased interest expense on the COLs (see
Note 8 to EPP's financial statements and notes thereto). This increase was
partially offset by decreases in interest expense, net, at the Subic Plant ($0.2
million) and the Batangas Plant ($0.2 million) for the third quarter of 1997,
primarily due to lower outstanding debt balances.

   INCOME TAX EXPENSE. Income tax expense is the tax on the power plants in
their respective local jurisdictions. On an aggregate basis, the effective tax
rate for the Subic and Batangas Plants is less than the statutory rate due to
the Subic and Batangas Plants being granted certain income tax holidays and
concessions. PQPC is organized as a U.S. domiciled company with a foreign branch
office. SECLP has been granted an income tax holiday for the life of the
project. Income tax expense remained relatively unchanged from the third quarter
of 1996 compared to the third quarter of 1997.

RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 VS. THE NINE 
MONTHS ENDED SEPTEMBER 30, 1996

   Presented below is a summary of income  statement  information  for the 
combined power operations of the Subic, Batangas, Puerto Quetzal and Puerto
Plata Plants for the first nine months of 1997 and 1996 on a U.S. GAAP,
historical U.S. dollar, 100% ownership basis. See "Results of Operations of EPP
-- General."

<TABLE>
<CAPTION>
                                                    NINE MONTHS ENDED
                                                      SEPTEMBER 30,
                                                ------------------------
                                                  1997           1996
                                                ---------      ---------
                                                     (IN THOUSANDS)
<S>                                             <C>            <C>
Capacity revenues                               $  98,759      $  97,090
Variable revenues                                  69,157         56,854
                                                ---------      ---------
  Total Revenues                                  167,916        153,944
Fuel cost                                         (53,026)       (42,462)
Operating and administrative expenses             (30,006)       (29,113)
Depreciation and amortization expense             (26,157)       (26,580)
                                                ---------      ---------
  Net Operating Income                             58,727         55,789
Interest expense, net                             (27,658)       (27,266)
Other expense, net                                 (1,573)        (1,711)
                                                ---------      ---------
  Income Before Income Taxes                       29,496         26,812
Income tax expense                                 (3,230)        (2,891)
                                                ---------      ---------
  Net Income                                    $  26,266         23,921
                                                =========      =========
EPP's Equity in Earnings of Power Operations    $  13,027      $  11,676
                                                =========      =========
</TABLE>

   REVENUES. Capacity revenues increased $1.7 million (2%) in the first nine
months of 1997 compared to the first nine months of 1996. Capacity revenues
increased at the Puerto Plata Plant ($1.1 million) in the first nine months of
1997 primarily due to increased output and a full period of commercial
operations during 1997 versus 1996 in which commercial operations commenced on
January 15, 1996. Capacity revenues increased at the Puerto Quetzal Plant ($0.6
million) in the first nine months of 1997 primarily due to increased output.

   Total variable revenues increased $12.3 million (22%) for the first nine
months of 1997 compared to the first nine months of 1996, primarily due to the
increase at the Puerto Plata Plant ($10.1 million) and the Puerto Quetzal Plant
($2.0 million). The increase at the Puerto Plata and Puerto Quetzal Plants in
the first nine months of 1997 was primarily a result of increased output
partially offset by lower fuel prices. Variable revenues remained relatively
unchanged for the first nine months of 1997 at the Subic and Batangas Plants.

   FUEL COST. Total fuel cost increased $10.6 million (25%) for the first nine
months of 1997 compared to the first nine months of 1996, primarily as a result
of the increase in fuel cost at the Puerto Plata Plant ($8.7 million) and the
Puerto Quetzal Plant ($1.9 million). Fuel cost at the Puerto Plata and the
Puerto Quetzal Plants increased for the first nine months of 1997 primarily due
to the increased output and lower fuel prices discussed above.


                                       21
<PAGE>   24
   OPERATING AND ADMINISTRATIVE EXPENSES. Operating and administrative expenses
increased $0.9 million (3%) in the first nine months of 1997 compared to the
first nine months of 1996. The increase was primarily due to increased operating
and administrative expenses of the Puerto Plata Plant ($2.9 million), partially
offset by decreased operating and administrative expenses at the Subic Plant
($1.2 million) and the Puerto Quetzal Plant ($0.7 million). The increase in
operating and administrative expenses at the Puerto Plata Plant for the first
nine months of 1997 was primarily due to increased legal fees associated with
the CDE arbitration (see Note 9 to EPP's financial statements and the notes
thereto) and maintenance costs. The decrease in operating and administrative
expenses at the Subic and Puerto Quetzal Plants for the first nine months of
1997 were primarily a result of decreased maintenance costs.

   DEPRECIATION AND AMORTIZATION EXPENSE. Depreciation and amortization expense
decreased $0.4 million (2%) in the first nine months of 1997 compared to the
first nine months of 1996. The decrease was primarily due to lower depreciation
and amortization expense at the Puerto Plata Plant ($0.4 million).

   INTEREST EXPENSE, NET. Interest expense, net, increased $0.4 million (1%) for
the first nine months of 1997 compared to the first nine months of 1996.
Interest expense, net, increased $2.0 million at the Puerto Plata Plant in the
first nine months of 1997 primarily as a result of increased interest expense on
the COLs (see Note 8 to EPP's financial statements and notes thereto). This
increase was partially offset by decreases of $0.8 million, $0.5 million and
$0.3 million at the Batangas, Subic and Puerto Quetzal Plants, respectively, in
the first nine months of 1997, primarily due to lower outstanding debt balances.

   INCOME TAX EXPENSE. Income tax expense increased $0.3 million (12%) for the
first nine months of 1997 compared to the first nine months of 1996, primarily
as a result of an increase at the Puerto Quetzal Plant primarily attributable to
increased taxable income.

LIQUIDITY AND CAPITAL RESOURCES OF POWER OPERATIONS

   Capital expenditures for the power plant operations are expected to be
insignificant in 1997. The power plant operations expect to meet short and
long-term liquidity needs using cash flows from operations. If a specific power
plant has short-term liquidity needs that cannot be met with cash flows from
operations, it is expected that such plant would borrow or be advanced the
necessary funds from an affiliated company.

INFORMATION REGARDING FORWARD LOOKING STATEMENTS

   This Quarterly Report on Form 10-Q includes forward looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Although EPP
believes that its expectations are based on reasonable assumptions, it can give
no assurance that its goals will be achieved. Important factors that could cause
actual results to differ materially from those in the forward looking statements
herein include political developments in foreign countries, the timing and
success of Enron's efforts to develop international power, pipeline and other
infrastructure projects and conditions of the capital markets and equity markets
during the periods covered by the forward looking statements.


                                       22
<PAGE>   25
                      ENRON GLOBAL POWER & PIPELINES L.L.C.

                                    PART II.
                                OTHER INFORMATION

ITEM 4.         SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         On or about October 17, 1997, EPP mailed proxies to the holders of the
Common Shares to approve the Amended and Restated Agreement and Plan of Merger
between Enron Corp. and EPP dated August 18, 1997, and amended and restated as
of September 15, 1997. The special meeting of the EPP Shareholders to vote on
such approval is scheduled for November 18, 1997.

ITEM 5.         OTHER MATTERS

         On August  18,  1997,  EPP  entered  into an  Agreement  and Plan of 
Merger with Enron Corp. and Enron International Merger L.L.C. (the "Merger
Agreement"), as more fully described in the Merger Agreement. The Merger
Agreement was amended and restated as of September 15, 1997.

         The Merger Agreement contemplates the merger of a subsidiary of Enron
Corp. with and into EPP in a transaction whereby the shareholders of EPP other
than Enron Corp. and entities controlled by Enron Corp. would receive Enron
Corp. common stock having a market value (based on the average trading price of
Enron Corp. common stock for a 20 trading day period prior to the completion of
the merger) of $35 per share. The merger is conditioned upon the approval of (i)
a majority of the Common Shares of EPP outstanding and (ii) a majority of the
EPP Common Shares held by persons other than Enron Corp. and entities controlled
by Enron Corp. present and voted at the shareholders meeting to be called to
vote upon the merger.

         Assuming shareholder approval (as described above) is obtained, the
merger is anticipated to become effective on or about November 19, 1997 (see
Note 14 to EPP's financial statements and notes thereto).

         A lawsuit has been filed by one of EPP's shareholders seeking to enjoin
the merger with Enron, a copy of such petition is attached hereto as Exhibit
99.1. The lawsuit, which was served on EPP on November 10, 1997, seeks recovery
of unspecified damages and rescission of the merger if it is not enjoined. The
lawsuit purports to be filed as a class action on behalf of all holders of EPP
common shares against Enron, Enron International Merger L.L.C., EPP, and each of
the directors of EPP. The suit alleges, among other things, that the directors
of EPP breached their duties to EPP shareholders by approving the Merger
Agreement and recommending that it be adopted by EPP's shareholders, that the
merger price is unfair, that the members of the Oversight Committee (composed of
the three non-Enron affiliated directors of EPP), which approved the merger,
were not independent and that Enron used its majority ownership of EPP to
unfairly dominate the merger process for its own benefit. EPP and Enron believe
that the lawsuit is without merit and does not take into consideration the
lengthy and careful arm's length negotiating process which led to the approval
of the Merger Agreement by a unanimous vote of EPP's independent Oversight
Committee. EPP and Enron intend to vigorously defend against the allegations in
the litigation.

ITEM 6.          EXHIBITS AND REPORTS ON FORM 8-K

<TABLE>
<CAPTION>

    (a)  Exhibits:
        <S>       <C>
         10.1     Firm Transportation Service Agreement FT-34, between TGS and
                  MetroGas S.A. commencing March 15, 1996, with English
                  translation.

         10.2     Firm Transportation Service Agreement FT-36, between TGS and
                  MetroGas S.A. commencing March 15, 1996, with English
                  translation.
</TABLE>


                                       23

<PAGE>   26

<TABLE>
        <S>       <C>
         99.1     Plaintiff's  Original Class Action Petition filed by Harvey  
                  Greenfield,  Plaintiff,  against EPP et al., Defendants.
</TABLE>

    (b) Reports on Form 8-K:

         EPP filed (a) Form 8-K on July 17, 1997, to announce the ENARGAS
resolution covering the base natural gas transportation tariffs of TGS and (b)
Form 8-K on August 22, 1997, to announce the proposed merger of EPP and Enron
Corp.




                                       24
<PAGE>   27
                                   SIGNATURES

    Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                       ENRON GLOBAL POWER & PIPELINES  
                                       L.L.C.
                                       (Registrant)

Date:    November 13, 1997             By /s/ RODNEY L. GRAY
                                          ------------------------------------
                                          Rodney L. Gray
                                          Chairman and Chief Executive Officer

Date:    November 13, 1997             By /s/ KURT S. HUNEKE
                                          ------------------------------------
                                          Kurt S. Huneke
                                          President and Chief Financial Officer



                                       25
<PAGE>   28
                                INDEX TO EXHIBITS
<TABLE>
<CAPTION>
  EXHIBIT
  NUMBER
  -------
   <S>            <C>
   10.1           Firm Transportation  Service Agreement FT-34, between TGS 
                  and MetroGas S.A. commencing March 15, 1996, with English 
                  translation.

   10.2           Firm Transportation  Service Agreement FT-36, between TGS 
                  and MetroGas S.A. commencing March 15, 1996, with English 
                  translation.

   99.1           Plaintiff's  Original Class Action Petition filed by Harvey  
                  Greenfield, Plaintiff, against EPP et al., Defendants.
</TABLE>




                                       26