Subject: "Airline exposure".

Body: Dave: I read Gordon Bethune's comments is the Chronicle this morning and if he concerned about Continental's solvency, the other carriers must be even more at risk. As Bill and I are traveling, could you help in asking for a recap of our Airline positions? We probably should identify the universe of names. Given the high operating leverage in this industry, coupled with lease leverage, it does not take much to go negative. For United and American I would imagine access to CP and revolvers would be potentially problematic. I will be Bill at about 6:45 before we leave, if this is already in process, I'll leave a voice mail. Regards,

Subject: "LNG/C"HOEGH GALLEON" - ETA LAKE CHARLES".

Body: Dan, Ref. is made to yr e-mail dated 30th re adjusting ETA Lake Charles to the 9th at latest 0600LT. Please be advised that the vessel is instructed to arrive Lake Charles June 9th 0400lt accordingly. Best regards

Subject: "Follow-up with Hertzberg on Core/Noncore".

Body: Hertzberg called. We very briefly discussed the scenarios that he asked us to build for him. I've attached the file. the supporting spreadsheets are not included. If folks would like them, let me know. Please keep the file confidential. Hertzberg wanted to see what happened to rates for large (noncore) customers if the small (core) customers' share of past utility debt is shifted to noncore customers. Our analsis shows that noncore rates approach Loretta's recent rate increases when approximately 50% of core's share of utility past debt is shifted to businesess (i.e., to noncore). (In fact, Edison's rate in this scenario is below the Lynch rate, while PG&E's is modestly above.) Increasing the cost shift above the 50% level would start to push rates significantly above the Lynch rates. Note, however, that in its recent submission to the PUC, DWR's asserts that it's revenue requirement is substantially higher than the revenues support by the Lynch rate increase, suggesting that Lynch will have to increase rates again soon. In addition, Loretta's rates also do not reflect past utility costs, which will require yet additional increases. I expect to have another conversation with the Speaker later this evening or tomorrow to discuss the scenarios in more detail (he would still like to put 100% of the IOUs past debts on noncore in exchange for getting a competitive market and out from under Loretta). I will report back after we've spoken. All ideas, suggestions, etc. regarding the attached spreadsheet are welcome and appreciated. Best,

Subject: "Wildhorse Consent".

Body:
Attached is a letter to Wildhorse consenting to the assignment of Crescendo's gathering agreements from Wildhorse to Tom Brown. The letter reserves all our rights for Wildhorse's breach. Also attached is a letter for December nominations into Questar reserving our rights. Please review and provide any comments.