Subject: "Draft of revised definition of Material Adverse Change/Credit Rating Trigger".

Body: Pursuant to our discussion yesterday regarding the above, please find below for your consideration a suggested revision to MAC/Credit Rating trigger definition to used in all future master trading agreements or confirmations in which Enron Corp's credit rating is part of a MAC/Credit Rating trigger. "Material Adverse Change" means (i) with respect to [Enron Trading Entity], Enron Corp. (or its successor or its successor's parent company) shall have long-term, senior, unsecured debt not supported by third party credit enhancement that is rated by S&P below "BBB-" [also insert Moody's as appropriate]; I understood yesterday that we may also need to consider changing the definition of Credit Support Provider in the ISDA's. I suspect that if "Credit Support Provider" is defined as Enron Corp. in the relevant Master, then the corresponding changes noted above would also need to be made. Your further thoughts regarding this issue are welcomed. Please provide me your comments to the above language by tomorrow so we can start implementing a revised definition in our agreement templates. Regards, Alan

Subject: "Online Trading Australian Financial Power GTC".

Body: Mark Taylor, who is in Amsterdam this week, just left me a voicemail reflecting a conversation he just had with Dave Forster, and asked me to relay the following information to you (don't kill me, I'm just the messenger)... With respect to your form of online GTC: It need to be revised, per Dave Forster by Monday, to be expanded to include the provisions necessary that will enable a non-Australian based counterparty (a counterparty could be U.S., Canadian, European or other country based), who may or may not have an ISDA Master Agreement in place, and may or may not have credit in place, to do a financial power transaction with Enron Australia. In that regard I am attaching as a template, our form of online "Deemed ISDA" GTC (for a weather transaction, the only type of financial transaction where we adopt the ISDA documentation instead of using our own form of confirmation). As you can see when you look at our "Deemed ISDA" form of confirmation, there are a number of provisions that our Deemed ISDA form of confirmation includes, such as authority and tax representations, "arm's length transaction" reps, acting as a principal rep, the deletion of section 2(c)(ii) of the ISDA Schedule (netting "in respect of the same transaction"), no language that each party has a copy of the ISDA form and has read it and understands it, your deletion of language re: written confirmations, definition of "Transaction" meaning the GTC+ISDA form+website terms, "Website" (uppercased) is a defined term under the Password Application, we usually say "Loss" instead of "Market Quotation", also, Market Quotation and Second Method will apply for the purposes of Section 6(e), a question, do we need the word "integrated" with respect to the rerenced that the documents contain a "single agreement" to fall under the U.S. bankruptcy swap protection?, no ducment conflict provisions, missing our "severability" and "setoff" language, no adoption of the 1991 or 1993 Commodity definitions, business day defined as Sydney only, etc. Of course, you do not have these in your form of GTC, because they are or will be covered in your executed ISDA Master Agreement, but it is likely counterparties outside of Australia may not have a master swap agreement in place. I spoke to Steve Douglas in Tax, who is out of town today and was going to talk to Susan Musch about the tax issues and I hope to hear from him tomorrow. After all the above, I just have to say...we really do appreciate your help resolving all these issues...

Subject: "Next Week".

Body: Greg, My Thursday just filled up. But I'm still targeting either Tuesday or Wednesday to be in the neighborhood. I have to turn in my TA-50 to my former unit, 4-112 Armor, which is in Bryan. Houston is just another hour from there. I suspect your schedule is going to be swamped for the next few months, if not years. If next week is too soon, my long-term calender is not too difficult to sort out at this time. Just let me know so I won't inconvenience you. Were you planning on coming up for the TCU game? Woody

Subject: "Freight Rates - West Africa - Med / Caribs".

Body:
Paul, in comparing freight rates for Med vs Caribs and Caribs vs Caribs (cargo size), I do see Bo's point. For smaller lot sizes (8,600 - 11,800 MT), the rates are abt. : $50 - $60 W. Africa to Med and $60 - $80 W. Africa to Caribs however, the larger cargoes (20,000 - 30,000 MT) curently moving are as follows: $30 - $40 W. Africa to Med and $40 - $60 W. Africa to Caribs So, in comparison to the Med, the additional freight incurred on moving a 8,600 MT cargo to Puerto Rico vs a 20,000 MT cargo to the Med is $40.00, or for an 11,800 MT cargo $20.00. Granted, these are not negotiated numbers, so they could be slightly better. Let me know your thoughts. Just keep in mind that PDVSA is there to supply an October cargo at +7. I would hesitate to purchase from an alternative source lest they back off on other negotiations. Best regards,