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                                                                  Exhibit 10.1.f

                    BASIC TOLL AGREEMENT FOR INJECTION LINES
                                     BETWEEN
                      EMPRESA NACIONAL DE ELCTRICIDAD S.A.
                                       AND
                 COMPANIA NACIONAL DE TRANSMISION ELECTRICA S.A.

In Santiago, Chile, on October 23, 2000, between EMPRESA NACIONAL DE
ELECTRICIDAD S.A., hereinafter and indistinctly, ENDESA, represented by its
General Manager, Mr. Hector Lopez Vilaseco, both domiciled in Santiago at Calle
Santa Rosa No. 76, Floor 17, and COMPANIA NACIONAL DE TRANSMISION ELECTRICA
S.A., hereinafter and indistinctly referred to as TRANSELEC, represented by its
General Manager, Mr. Guillermo Espinosa Ihnen, both domiciled in Santiago at
Calle Santa Rosa No. 76, Floor 9, the following has been agreed:

ONE: PURPOSE.

The present contract has the purpose of agreeing as to the annual basic toll
payments that ENDESA is to pay to TRANSELEC for the facilities indicated in
Exhibit No 1 and which are used to carry out electricity uploading,
hereinafter Uploading Facilities, to the Central Interconnected System (SIC) its
power plants Canutillar (nominal power 145.0 MW), El Toro (nominal power 400.0
MW), Antuco (nominal power 300.0 MW), Abanico (nominal power 136.0 MW), Bocamina
(nominal power 125.0 MW), Cipreses (nominal power 101.4 MW), Isla (nominal power
68.0 MW), Sauzal (nominal power 76.8 MW), Sauzalito (nominal power 9.5 MW),
Rapel (nominal power 350.0 MW), Los Molles (nominal power 16.0 MW), Huasco
(nominal power 80.23 MW), Diego de Almagro (nominal power 23.75 MW) and Taltal
(nominal power 240 MW) hereinafter ENDESA Power Stations, commencing from
October 23, 2000.

The basic toll anual payments will entitle ENDESA to upload up to the maximum
power and energy production capacity of the ENDESA Power Plants, which
capacities are indicated in the preceding paragraph, to transmit it, and to
download energy and power by means of the facilities which form part of its area
of influence. ENDESA shall exercise this right in accordance with such
provisions as the Economic Load Dispatch Center of the Central Interconnected
System (the CDEC-SIC) may impart for such purpose.

Likewise, such downloads without supplementary payments as ENDESA may make in
the area of influence of each one of its power plants, once it has paid the
basic toll, are limited to:

a)    The total capacity of the transmission system involved.

ENDESA - TRANSELEC Basic Toll Injection Lines                                  1
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      b)    At such limits as the CDEC-SIC may establish, in consideration of
            that provided for in Article 198 of the Electricity Regulations.

TWO: ANRV + OMC

The parties agree that the values of the Annual Payment for New Replacement
Values plus the Costs of Operation and Maintenance (the ANRV + OMC) for the
Uploading Facilities are those presented in Exhibit No. 1 to the present
contract , expressed in thousands of dollars of the United States of America on
the date of March 1, 2000. Said ANVR's + COM's duly indexed through the formula
referred to in clause EIGHT, will be in effect up to October 31, 2012.

THREE: PRO-RATA AMOUNTS

The parties agree that the pro-rata amounts for the ENDESA Power Plants for the
period from October 23, 2000 to October 31, 2012 are those indicated in Exhibit
No. 2 to the present contract .

FOUR: DEFINITION OF THE NEW REPLACEMENT VALUE

For the purposes of the present contract, the New Replacement Value for the
transmission facilities, hereinafter, without distinction, NRV, will be
understood to mean the cost of renewing all of the works, facilities and
physical assets intended for the function of the transmission of electricity.

Renewal is understood to mean the activity of replacing the works, facilities
and physical assets presently in service with others that are equal. In the
event that they do not exist on the market, the respective cost is to be that of
the works, facilities and physical assets of modern technology, and current
cost, meant to fulfill the same function with the same standards of quality of
service. In the case of the transmission lines, those existing are considered
with respect to the topographical layout, structures, voltage, numbers of
circuits, and electrical transmission capacity. In the case of the sub-stations,
consideration is given, in addition to the primary control and protection
equipment, to the auxiliary equipment, including that of the auxiliary services,
battery banks and emergency equipment, buildings meant to house the equipment
indicated, pieces of land, and general works.

The costs associated with the NRV's for the transmission lines and for the
sub-stations which constitute the area of influence of the ENDESA Power Plants
include the following items, which are set forth solely as examples, this
listing not being exhaustive: engineering and design, construction management
and inspection, easements and compensations, supply of imported and domestic
equipment and materials with the respective entry tariffs, port charges and
domestic and international freight, construction and assembly of works and
equipment, other financial and administrative costs such as staggered interest,
overhead expenses, and operating capital.

For purposes of the valuation of the lines, the original copper wire is replaced
by one of aluminum with equivalent characteristics. In the valuation of the
sub-stations, the switches for large volumes of oil, for compressed air, and for
large volumes of SF6 gas have been valuated as switches for small volumes of SF6
gas. The synchronous condensers are valuated as if they were static condensers.

FIVE: COSTS OF OPERATION AND MAINTENANCE

The costs of operation and maintenance (OMC) take into consideration all of the
costs necessary for the adequate maintenance of the facilities and their proper
decentralized operation subordinate to the Zone Operation Centers (ZOC) and to a
Centralized Transmission Dispatch.

The OMC's take into consideration the operating expenses intended for the
planning, execution and control of the activities of operation and maintenance,
whether the latter are preventative, scheduled

ENDESA - TRANSELEC Basic Toll Injection Lines                                  2
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corrective, or unscheduled corrective, and the expenses and insurance for
accidents to buildings and facilities.

In addition, the OMC's include the costs of capital, of operation, and of
maintenance for the vehicles, for the maintenance equipment, for the
telecommunications systems, for the tools and for instruments necessary for
carrying out the activities of operation and maintenance, including the remote
terminal units (RTU), the Zone Operation Centers (ZOC), and the Centralized
Transmission Dispatch. Likewise, the OMC 's include the costs of capital, of
operation, and of maintenance for the pieces of land and buildings, such as
workshops, offices, and warehouses meant for operation and maintenance.

SIX: BASIC TOLL ANNUAL PAYMENTS

The parties agree that, commencing on October 23, 2000, and up to October 31,
2012, under the category of the basic ANRV + OMC for its power plants, ENDESA
will pay to TRANSELEC such amount as results from multiplying the sum of the
annual payment for the new replacement value (ANRV) and the costs of operation
and maintenance (OMC) for each one of the facilities of the area of influence
of the said power plants by the pro-rata amount corresponding to said power
plants.

As a result of that indicated above, the parties agree that the annual basic
toll payments for the ENDESA Power Plants for the period from October 23, 2000,
and up to October 31, 2002, net of the value-added tax, which ENDESA is to pay
to TRANSELEC, are those indicated in Table No. 1 below. These annual payments,
the calculation of which is indicated in Exhibit No. 3 to the present contract,
are expressed in dollars of the United States of America as of March 1, 2000.

TRANSELEC hereby declares that during the period referred to in the foregoing
paragraph it will make its best efforts to achieve, if pertinent, the
participation of third parties, other than ENDESA, in the payment for the use of
the Uploading Facilities. All the amounts that TRANSELEC is to recover for this
item will be deducted from the payment to be made by ENDESA, in such manner that
TRANSELEC always receives 100% of the ANVR + OMC value of the Uploading
Facilities.

                                   Table No. 1
                     ANRV + OMC for the ENDESA Power Plants
                    (basic ANRV + OMC ) Uploading Facilities
                Period from October 23, 2000, to October 31, 2012
                Values in thousands of US $ as of March 1, 2000

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

                      Power Plant         PERIOD 10/10/2000 to
                                               10/31/2012

                 -------------------------------------------------
                 Canutillar                               1,822.00
                 -------------------------------------------------
                 Toro                                     4,722.13
                 -------------------------------------------------
                 Antuco                                   2,087.55
                 -------------------------------------------------
                 Abanico                                  1,924.00
                 -------------------------------------------------
                 Bocamina                                       --
                 -------------------------------------------------
                 Cipreses                                 1,744.50
                 -------------------------------------------------
                 Isla                                     1,237.72
                 -------------------------------------------------
                 Sauzal - Sauzalito                         231.00
                 -------------------------------------------------
                 Rapel                                    3,867.00
                 -------------------------------------------------
                 Los Molles                               1,078.00
                 -------------------------------------------------
                 Huasco                                   1,264.00
                 -------------------------------------------------

ENDESA - TRANSELEC Basic Toll Injection Lines                                  3
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                 -------------------------------------------------
                 Diego de Almagro                           170.00
                 -------------------------------------------------
                 Taltal                                   3,481.00
                 -------------------------------------------------
                                  TOTAL                  23,628.90
                 -------------------------------------------------

SEVEN: PAYMENT MODALITY

The basic ANRV + OMC's will be paid in twelve monthly installments upon each
month due, equivalent to multiplying the value of the basic ANRV + OMC indicated
for each period and power plant in Table No. 1 above, duly indexed according to
that provided for in Clause EIGHT by the factor of 0.07974 (seven thousand nine
hundred seventy-four one-hundred-thousandths) and converted to pesos of domestic
currency employing the exchange rate corresponding to the "observed dollar"
referred to in the first paragraph of No. 6 of Chapter I, Title I, of the
Compendium of International Currency Exchange Rules published by the Central
Bank of Chile, or such as may replace it in the future, at the average for the
month corresponding to payment. The monthly payment thus stipulated must contain
a separate surcharge for the value-added tax, the V.A.T.

TRANSELEC will send the invoice within the first five (5) business days of the
month subsequent to the month to which the charge pertains. ENDESA undertakes to
pay such invoice to the treasury of TRANSELEC in Santiago, in cash, by check,
not crossed, within the banking region of Santiago, or bank Sight Draft, at
latest prior to 12:00 a.m. on the sixteenth day of each month subsequent to the
month to which the charge pertains. If such day is a Saturday, Sunday or
holiday, the time due will extend up to 12:00 a.m. on the subsequent business
day.

Nevertheless, the parties may agree to a different method of payment, which may
be by a bank transfer of funds or deposits into any of the checking accounts of
TRANSELEC. In such case ENDESA must inform TRANSELEC in writing as to the date,
amount, checking account number, and bank through which the payment or deposit
has been made, as well as the number of the invoice or invoices that it has
paid.

In the case of default or simple delay in payment, interest will accrue at the
maximum contractual rate for transactions that are not adjustable of less than
or more than ninety (90) days, as the case may be, from the date when the
default or simple delay took place and up to the date of the actual payment
thereof.

In the event that TRANSELEC sends the invoice late, ENDESA will be able to
postpone its payment by one day for each day of delay and such postponement will
not be deemed to be a default or simple delay for the purposes of charging the
interest referred to in the preceding paragraph.

EIGHT: INDEXING

The parties agree that the monthly payments pertaining to the annual basic toll
amounts for the Uploading Facilities of ENDESA Power Plants are to be indexed
semi-annually on January 1 and on July 1 of each year, multiplying the monthly
payment in force for the prior month by such factor as may result from applying
the formula for indexing tolls detailed in Exhibit No. 4 to the present
document. For these purposes, the said indexing factor will be deemed to be
rounded off to the fifth decimal. The first indexing will take place on July 1,
2000 and will cover the period between March 1, 2000 and June 30, 2000. The
parties agree that the indexing factor corresponding to the said period is
0.99951.

Whenever a semi-annual indexing of tolls is applicable, TRANSELEC will prepare
and will send to ENDESA a memorandum of calculation containing, in a detailed
and documented manner, the value

ENDESA - TRANSELEC Basic Toll Injection Lines                                  4
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of the new monthly payment. The sending of this document must take place five
(5) business days in advance of the date of sending of the invoices
corresponding to the months of January and July.

NINE: SETTLEMENT OF THE VIRT's

The parties agree that they will carry out a monthly settlement, between
themselves, of the valuation of the uploads and downloads per segment (VIRT's)
for each one of the segments indicated in Exhibit No 1, generated by the
balances of uploads and downloads made by the CDEC - SIC for each one of the
said segments. The settlement indicated will be carried out during the month
subsequent to the month to which the settlement pertains, once TRANSELEC has
actually received such amounts from the rest of the members of the CDEC - SIC.
In the event that the CDEC - SIC has not determined the VIRT's or in the event
that TRANSELEC has not received all or part of the VIRT's from the rest of the
members of the CDEC - SIC, the parties may agree on provisional settlements
under this category, on account against final payment.

The amount to be paid for the settlement of the VIRT's will be determined as the
addition of all the values resulting from multiplying ENDESA pro-rata for each
segment by the VIRT of each of said segments. If the amount of the settlement
corresponding to the entirety of the segments indicated in Exhibit No 1 proves
to be greater than zero, TRANSELEC will pay such amount to ENDESA plus the
value-added tax and, to the contrary, if the amount of the total settlement
proves to be less than zero, ENDESA will pay the absolute value of such amount,
plus the value-added tax, to TRANSELEC. For purposes of these settlements, if
appropriate, the same interest rate as that employed by the CDEC - SIC will be
used.

TEN: PERIOD OF EFFECTIVENESS

The present contract will have an unlimited period of effectiveness commencing
from October 23, 2000.

Notwithstanding that provided for in the previous paragraph, either of the
parties may request from the other party in writing, commencing from October 31,
2012, a partial or total revision of the contract.

If the parties do not reach an agreement on the modifications to the contract
arising from such general or partial revision requested within a term of six
months from the date of receipt of such request, the parties agree to submit the
difference to the arbitration panel provided for in Clause FIFTEEN. The contract
will be modified under the terms decided by such arbitration panel.

In no case will a gap arise in the payments that ENDESA makes to TRANSELEC. In
the event that methodological or regulatory absences of definition exist
deriving from legal modifications, the monthly payments will continue to be made
on the basis of the present contract in a provisional manner subject to adjusted
settlement until such time as such absences of definitions are resolved by
mutual agreement between the parties or in accordance with the procedure
established in Clause FIFTEEN.

The respective modification of the Uploading Facilities basic toll, a result of
the general revision requested, whether arising by agreement of the parties or
by decision of the arbitration panel, will govern from the time when the event
causing such revision arises or enters into force, giving rise to such monthly
settlement readjustments as may pertain. The differences will be paid, if
appropriate, by such party as proves to be the debtor, with the interest current
for transactions that are not

ENDESA - TRANSELEC Basic Toll Injection Lines                                  5
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adjustable of more than or less than 90 days, as may pertain, within a maximum
term of 30 days subsequent to the time when the contract arises or the
arbitration award becomes executory.

ELEVEN: LIABILITIES

The liabilities of the contracting parties will correspond to those defined in
Decree with Force of Law No. 1 of 1982 of the Ministry of Mining, hereinafter
the Electricity Law, the Supreme Decree No 327 published on September 10,
1998, hereinafter the Electricity Regulations, the manuals and procedures of the
CDEC - SIC, and the modifications or changes of the mentioned legal sources.

TRANSELEC will at no time be liable for such damages or losses as ENDESA may
suffer due to a total or partial lack of supply of electrical energy and power,
excessive variations in voltage or frequency, or others, caused by technical
failures which may affect the facilities of the Transmission System of TRANSELEC
(SIT), or due to any other event that may interrupt, paralyze, or disturb
transmissions of energy or power at the facilities of the area of influence of
the ENDESA Power Plants caused by an act of God or force majeure and, the
listing which follows not being exhaustive, the following: damage to equipment
or lines caused by the third parties or birds or animals, damage caused by
natural phenomena, telluric phenomena, lightning, storms, falling trees, floods,
and inundations, among others.

On its part, ENDESA will in no case be liable for such losses as TRANSELEC may
suffer due to technical failures or any other event which may interrupt,
paralyze, or disturb the generating or transmission of energy and power at the
ENDESA Power Plants caused by an act of God or force majeure. Among other
things, an act of God or force majeure will be deemed to be the occurrence of a
prolonged drought that impedes the normal generating of energy.

TWELVE: SUSPENSION OF SERVICE

TRANSELEC may suspend the transmission of energy and power for purposes of
scheduled modification or maintenance work. Such suspensions will be planned and
scheduled by TRANSELEC upon hearing the opinions on this subject from the
various generating companies affected by such interruption in supply. Such
suspensions must be communicated by TRANSELEC to ENDESA in writing at least
sixty (60) days in advance.

The suspensions of service will be governed by the Electricity Law, by the
Electricity Regulations, and by the rules and regulations of the CDEC - SIC.

TRANSELEC may also suspend the transmission of energy and power for purposes of
emergency repairs. Such suspensions will take place with the giving of notice to
ENDESA as far in advance as the circumstances permit.

THIRTEEN: INFORMATION ON OPERATION

TRANSELEC undertakes to send to ENDESA, each time that events occur affecting
the normal functioning of the Uploading Facilities referred to in Exhibit No
1, a report in which it will set forth the irregularities and/or the
interruptions in service occurring at such facilities, prior to 12:00 a.m. on
the day subsequent to the occurrence of the event. In the mentioned report there
will be indication of the durations of the interruptions that may have arisen at
the Uploading Facilities of the ENDESA Power Plants and an estimate of the
energy interrupted through such facilities, the day and the time when it
occurred. In this same report or in another supplementary report the causes of
the irregularities will be indicated.

FOURTEEN: AVAILABILITY OF THE SYSTEM

ENDESA - TRANSELEC Basic Toll Injection Lines                                  6
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TRANSELEC undertakes to comply with such service quality standards as may be
established by the Electricity Law, the Electricity Regulations, the manuals and
procedures of the CDEC - SIC, and the modifications or changes in the mentioned
texts.

The forced unavailability of the transmission facilities included in this
contract, excluding the unavailability caused by malicious acts by third
parties, act of God and/or force majeure, that partially or totally hinders the
energy and power evacuation from generating plants owned by ENDESA, will cause a
reduction of basic toll by ENDESA to TRANSELEC .

This toll payment reduction will be equal to one point five times (1.5) the
amount of the basic toll annual payment (ANVR + OMC ) that would correspond to
pay for those facilities where the unavailability was verified, and only for the
period they were not available. Once the unavailability of a facility has been
verified, TRANSELEC will carry out the corresponding reduction, in the charge of
the monthly payment of the toll annual payment, immediately subsequent.

For the purposes to carry out such reductions, the monthly payment value of the
basic toll annual payment will be fractioned in terms of the number of hours
that this unavailability partially or totally hinders the energy and power
evacuation from generating plants owned by ENDESA.

FIFTEEN: ARBITRATION

Any problem that may arise between the parties relating to the interpretation,
performance or breach, application, or termination of the present contract will
be resolved by the Court of Arbitration constituted in accordance with that
indicated in Article 51 G of Decree with Force of Law No. 1 of 1982 of the
Ministry of Mining.

It is expressly established that, if one of the parties refuses to appoint or
delays the appointment of the arbitrator whom it is responsible for appointing,
the other party may resort to the regular courts to proceed with the appointment
thereof. It will be understood that a refusal or delay exists when the term of
twenty (20) days indicated in the third paragraph of the mentioned Article 51 G
has passed and the party has not made such designation.

Likewise, the parties set forth that if the arbitrators do not agree on the
designation of the third arbitrator within the same term as that referred to
above, such designation will be made by the Regular Court of Justice of the
Borough of Santiago, in which case the appointment shall necessarily fall upon
an attorney at law who has been a member of the Supreme Court or the Court of
Appeals of Santiago or Dean or Director of the School of Law of the University
of Chile or of the Catholic University of Chile.

Once arbitration is convened, the Court of Arbitration must decide, as the first
remedy, within a term less than sixty days, the amount that must continue to be
paid, if appropriate, by ENDESA to TRANSELEC provisionally, until such time as
the dispute is finally resolved.

SIXTEEN: LEGAL CAPACITIES

The legal capacity of Mr. Hector Lopez Vilaseco to represent ENDESA is set forth
in the public deed dated August 31, 2000, executed before the Notary Public for
Santiago Mr. Fernando Opazo Larrain.

The legal capacity of Mr. Guillermo Espinosa Ihnen to represent TRANSELEC is set
forth in the public deed dated August 18, 1997 executed before the acting notary
public for Santiago Mr. Ismael Ibarra Leniz.

ENDESA - TRANSELEC Basic Toll Injection Lines                                  7
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SEVENTEEN: EXHIBITS

The exhibits to this contract , four (4) in total, duly signed by the appearing
parties, form an integral part of this document for all contractual and legal
purposes.

EIGHTEEN: NUMBER OF COUNTERPARTS

The present contract is signed in four (4) counterparts, two (2) of which are
left in the possession of each one of the parties.

s/                                  s/
Hector Lopez Vilaseco               Guillermo Espinosa Ihnen
GENERAL MANAGER                     GENERAL MANAGER
ENDESA                              TRANSELEC

ENDESA - TRANSELEC Basic Toll Injection Lines                                  8<PAGE>

                                                                    Exhibit 10.2

                          FUTURE INVESTMENTS AGREEMENT

                                     BETWEEN

                      EMPRESA NACIONAL DE ELECTRICIDAD S.A.

                                       AND

                 COMPANIA NACIONAL DE TRANSMISION ELECTRICA S.A.

In Santiago de Chile, on October 23, 2000, between EMPRESA NACIONAL DE
ELECTRICIDAD S.A., hereinafter ENDESA, represented by its General Manager, Mr.
Hector Lopez Vilaseco, both with domicile in Santiago, Santa Rosa 76, floor 17,
and COMPANIA NACIONAL DE TRANSMISION ELECTRICA S.A., hereinafter TRANSELEC,
represented by its General Manager, Mr.Guillermo Espinosa Ihnen, both with
domicile in Santiago, Santa Rosa No. 76, floor 9, the following has been agreed:

ONE : BACKGROUND

Under Chilean electricity legislation, any interested party may invest in
transmission if it has the required permission and authorization.

ENDESA's main business line is the generation and commercialisation of electric
energy, while TRANSELEC's is the transmission of electric energy.

ENDESA and its generating subsidiaries have entered various contracts with
TRANSELEC covering the payment for the use of transmission facilities, by means
of basic and additional tolls, and rentals in accordance with the legal
provisions in force.

Aiming at the enhancement of its main business line, ENDESA is interested in the
realization of certain investments in and expansions of transmission capacities,
which will be connected to TRANSELEC facilities.

TRANSELEC is interested in executing and financing the investments and expansion
of the transmission capacities, mentioned in foregoing paragraph.

ENDESA and TRANSELEC have come to the understanding that it is of their mutual
interest to enter this Agreement to establish a framework which will enable the
development of such investments in and expansions of transmission capacity, in a
coordinate manner and according to the terms and conditions set forth in this
Agreement.

TWO : PURPOSE

The purpose of this Agreement is to establish the bases and agreements that
shall govern the business relations between the parties with respect to new
transmission investments.

THREE : FORTHCOMING INVESTMENTS RELATED TO POWER STATIONS AND TO CLIENTS

The parties agree that the forthcoming works ENDESA requires for meeting the
future transmission demand, shall be subject to this Agreement:

                                               Agreement Future Investment - 1 -

<PAGE>
                                       2

o     Expansions of the trunk system required by the commissioning of Ralco
o     Reinforcements associated with Taltal's northern transmission system.
o     Expansions of the 220 kV and 154 kV system related to the supply of CGE.
o     Expansion of the Quillota - Polpaico segment.

For reference, the Annex to this Agreement includes a summary of these projects,
their lead time and estimated investment requirement. Also included is a plate
of each individual work with a breakdown detailing the required works and
estimated investment. This Annex, signed by the parties, is understood to be
integral part of this Agreement for all legal effects.

FOUR : PROCEDURE FOR THE EXECUTION OF WORKS

Letter of Intention: For each project and whenever deemed appropriate, ENDESA
shall send TRANSELEC a Letter of Intention about the development of the project,
for their joint determination of the general conditions of the undertaking.
These general conditions refer to the identification of the engineering studies,
environmental and other permits, identification, scope, and modalities of the
bidding that may be required, and on the whole, each and every task to be
identified in order to prepare a provisional schedule of the various activities,
so to enable the control of the project's advance. This "intention stage" also
includes the understanding regarding the frequency and quantity of information
the parties shall exchange during the execution of the project, such as progress
reports, cost and expense statements, etc.

Furthermore, also required during this "intention stage" are the characteristics
of the projects' basic design. Set forth in the first place is that project
designs have to meet the standards set by comparable TRANSELEC facilities, as
well as the service safety criteria of the trunk system's facilities. In the
event of disagreements regarding this matter, the parties shall resort to an
independent expert, who shall settle the issue. Such criteria of design, quality
and safety of the equipment shall also be applied to all other decisions during
the stage of project execution, no matter who the project executor is.

Order to Proceed: Once an agreement has been reached regarding the general
conditions, ENDESA shall send TRANSELEC an Order to Proceed, so that this latter
one materialises the activities, which were identified during the previous
intention stage, until the conclusion and placing into service of the work. With
this Order to Proceed TRANSELEC shall initiate the corresponding cost record.

TRANSELEC shall issue a tender for bidding for the different activities to be
carried out, according to the items agreed in the intention stage, unless
otherwise agreed with ENDESA. The purpose of the bidding is that the cost
definition process reveals the technical and economic market conditions. The
call for bids shall be open to all bidders and suppliers the parties may
propose, provided they are competent and technically qualified. For the award of
each contract, TRANSELEC shall analyze the offers and the parties, by mutual
consent shall award it; in the event of dissension, ENDESA opinion shall
prevail.

During this stage of execution, TRANSELEC shall periodically inform ENDESA about
the progress of the work, the expenses defrayed and specially about the
estimated date of commissioning so to adopt the necessary measures in case of
anticipated difficulties or delays. Given the type of agreement and execution of
the projects, and regardless of TRANSELEC's commitment to deploy its best
efforts to meet the terms, TRANSELEC shall not be liable for the fulfilment of
target dates or continent delays. In the event contracts are charged with
penalties on account of belatedness or delay, such penalties shall be recorded
to be discounted from the project's direct costs when these are determined.

<PAGE>
                                       3

Execution by ENDESA: If during the intention stage a sufficient degree of
agreement has not been reached regarding the feasibility of execution of the
project within the stipulated time frame, ENDESA may chose to execute the work
itself assuming the complete project management, and inform TRANSELEC in writing
about such decision. Such an arrangement may be adopted by mutual consent of the
parties for the execution of one particular project. In the event of such
arrangement, ENDESA as project executor shall be bound to the same terms as
TRANSELEC, in such matters as information and project progress reports. The same
is applicable to the bidding procedures if ENDESA is the project executor.
ENDESA also commits itself to inform TRANSELEC about all costs defrayed and bids
awarded. Given the fact that TRANSELEC will be the owner of the new facilities,
and that it has to finance the same, a method of payment shall be established by
which TRANSELEC must pay ENDESA the costs defrayed at presentation of the
respective Expense Statements, while ENDESA commits itself to report all costs
that correspond to the project's direct investment cost. ENDESA shall collect
overhead expenses according to the manner detailed in following clause FIVE.
With respect to the securing iof environmental clearance, applications for
concessions, and other permits that may be required, and the easement
negotiations in the case of transmission lines, ENDESA shall obtain these so
that the holder of the rights obtained is TRANSELEC. ENDESA may delegate the
complete or part of the project to any one of its subsidiaries or to third
parties, informing TRANSELEC about such delegation. Furthermore, ENDESA may
delegate the execution of some activities to TRANSELEC itself, if this latter
party agrees to undertake such delegation.

In consequence, whatever manner of project execution is adopted, be it
TRANSELEC, ENDESA or a third party in charge of the project execution, TRANSELEC
commits itself to fund the works and logically will be the owner of the
facilities.

The parties state that they shall loyally and in good faith carry through the
negotiations and transactions and deploy their best efforts to conclude with all
possible speed the contractual matters and operations in each and every
undertaking under this Agreement.

FIVE : PAYMENTS ASSOCIATED WITH FUTURE INVESTMENTS

The works listed in the Annex and their modifications will be owned by
TRANSELEC, and TRANSELEC shall collect from ENDESA the payments detailed under
clause FIVE.

For each individual investment detailed in the Annex and any modification,
TRANSELEC and ENDESA shall jointly determine the New Replacement Value of these
works (VNR^1), based on all costs actually disbursed for materialising these
(direct cost), plus financial expenses (adjusted according to the mean financing
rate of TRANSELEC), plus overhead. Overhead charges shall amount to 7% of direct
costs in every case. The VNR^1 shall be the result of aforementioned amount
plus a 0.75% surcharge as operating capital.

In the case of works under this Agreement, which involve a reconversion of
existing facilities (for instance, change of voltage or conductor) the original
VNR of the facility (VNR^0) will be increased by adding the VNR^1 as
determined according to the foregoing paragraph to determine the new contractual
VNR contractual (VNR^C) of the segment to which the facility belongs.

The contractual VNR, VNR^C = VNR^0 +VNR^1, shall be estimated as approximately
as possible at the date of commissioning and immediately be applied
provisionally. Within eight months at the most from the date of commissioning,
the parties, by mutual consent, will determine the definitive VNR^C and settle
accounts in relation to the provisionally estimated value.

Based on the VNR^C an annuity at a 30-year term shall be calculated with an
annual rate of 10% (AVNR^C), in order to determine the annual payments
associated with the VNR^C to be paid by ENDESA.

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                                       4

In the special case of the new investment for static condenser banks, a 15-year
annuity at a 15-year term and 10% shall be applied.

Operating and Maintenance costs (CO&M) associated with the investments shall be
paid by ENDESA. These CO&M values shall be determined applying the procedure
TRANSELEC is using at the date of commissioning of the facility under the most
recent contract TRANSELEC entered with ENDESA or with any of ENDESA's
subsidiaries, in which CO&Ms were determined for similar facilities.

Thus, annual payments shall be equal to AVNR^C + CO&M; such value shall be
maintained constant, except for the corresponding indexation. The indexation
formula shall correspond to that used in the same contract for determining the
CO&Ms.

ENDESA commits itself to pay the resulting complete annuity during the fixed
term of twelve years from the commissioning of each project, after which the
facilities shall be part of the existing assets. In consequence, the general
procedures used for any user shall be applied for estimating ENDESA's and ENDESA
subsidiaries' payments.

During aforementioned period of 12 years, TRANSELEC shall inform ENDESA, if
appropriate, the participation of third parties, other than ENDESA, in the
payment for the use of the segments that are part of the new facilities.
Whatever tolls TRANSELEC recovers from third parties during such periods of
time, under the electricity legislation in force, shall be discounted by
TRANSELEC from ENDESA's payables; thus TRANSELEC shall receive for such
facilities only 100% of the annuity AVNR^C + CO&M established by the Contract.
Likewise and if appropriate, for the settlement of tariff revenues, the
complement to 100% of the sum of the pro-rata of third parties considered for
the discount of the AVNR^C +CO&M, shall enter into the accounts as pro-rata
that corresponds to ENDESA.

The payments to be made by ENDESA shall be set forth in a separate contract to
be entered by the parties to that end with respect to each project as detailed
in the Annex.

In no case shall a pause arise in the payments that ENDESA makes to TRANSELEC.
In the event of methodological or regulatory imprecision, the monthly payments
shall continue to be made based on the contracts in force, in a provisional
manner subject to be adjusted as soon as the issue is solved by the consensus of
the parties or in accordance with the procedure set forth in Clause SEVEN. The
differences, if any, shall be paid by the debtor party, with the current
interest for non-indexed operations at more or less than 90 days within 30 days
at the most from the date of the consensus or the arbiter's award.

SIX : OTHER REQUIREMENTS OF TRANSMISSION SYSTEMS

Should ENDESA require further transmission investments for domestic systems or
international connections, the corporation shall prioritize their
materialisation by TRANSELEC in accordance with the modus operandi accepted for
the facilities under this Agreement or any other similar procedure.

In this way, the parties may agree other investments, which shall be carried out
and paid according to the manner attuned to each individual case. In the event
of non-agreement with respect to such conditions, ENDESA may materialize them by
the means it sees fit.

ENDESA and TRANSELEC place on record that foregoing paragraphs cannot be applied
to the injection line, which is required to connect the Ralco station with the
trunk system at substation Charrua, which shall be implemented directly by
ENDESA. The parties may decide to transfer that line to TRANSELEC, once the
facility has been placed into operation.

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                                       5

SEVEN : CONTROVERSIES

Any controversy between the contracting parties that might arise with respect to
the purport, fulfilment or non-fulfilment of this Agreement and its application,
shall be solved by mixed arbitration, that is, arbitrator for the procedure and
arbiter rendering the award, who shall be the absolute and final judge, save
Remedy of Complaint.

Such arbitrator shall be designed by the parties' common consent within a period
of not over three days from the communication in writing of any one of the
contractual parties to the other one, formally stating its intention to resort
to arbitration and, in the event of disagreement, to the Regular Courts of
Justice. In that case, the appointment must necessarily fall upon attorney at
law who is or has been during at least 3 years a member of the 1st Court of
Appeals or of the Supreme Court, or is or has been during at least five years a
Senior Lecturer of Civil, Adjective or Commercial Law at any Faculty of Law of
the Catholic University of Chile, University of Chile or Catholic University of
Valparaiso.

Once arbitration is convened, the arbitrator must decide, as the first measure,
within a term of 60 days, the amount that ENDESA shall provisionally continue
paying TRANSELEC, if appropriate, until such time as the controversy is
ultimately resolved.

EIGHT : COPIES

This Contract is signed in four (4) original copies, two (2) of which are left
in the possession of TRANSELEC and two in the possession of ENDESA.

NINE : LEGAL RESIDENCE

For all effects whatever these may be, the parties set the city of Santiago de
Chile as their legal residence.

     /s/ Hector Lopez Vilaseco           /s/ Guillermo Espinosa Ihnen
        Hector Lopez Vilaseco              Guillermo Espinosa Ihnen
           General Manager                      General Manager
                ENDESA                             TRANSELEC

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