Subject: "TW/ Lonestar Ward and Pecos Counties interconnect bi-directional--A-release".

Body: The following is a level "A" cost estimate to make TW/ Lonestar existing interconnects bi-directional. TW/ Lonestar at Ward County ( 50 to 60 mmcf/d) According to Operations this is already bi-directional . The only things are required on this one is to take the flapper out of the check-valve and blow down the gas in 5.33 miles of 12". Cost of gas loss& labor = $8,000 TW/ Lonestar at Pecos County ( 100 mmcf/d) A): TW/ Lonestar interconnect Scope: On this one we need a bi-directional valve skid using the existing meter run. Cost of material& labor= $ 195,000 B): Pecos Compressor Station In order to make this interconnect bi-directional we also need to make the station ( two-compressor units) bi-directional. Scope: Install outlet from Lonestar I/C to inlet filter with 12" piping& valves. Unit discharge would be modified to tie in to West Texas-20" Cost for material& labor= $ 330,000. If you need more accurate costs ( B -release) please let me know .

Subject: "Forward Contract Advice".

Body: David: We need your and your firms' assistance regarding various forward contract issues that we continually seem to face as we develop new trading products and as we deal with our existing contracts in a distressed counterparty or bankruptcy situation. I thought that it would be helpful to summarize what we need done before we talk to you. Here are the areas that we need your advice on: 1. Obtaining Forward Contract Status a. All requirements deals b. bundled service contracts c. can only forward contract merchants terminate? If enter into single output contracts, does that affect our status as a forward contract merchant? (ewg, QF issues) d. review of Polaroid contract e. Review of EES retail contracts in general f. spot masters - are they forward contracts? 2. Termination Payments - is it considered a pre-petition or post-petition claim? 3. Utility Status - is any Enron entity a utility under the Code? 4. Swaps - can some of our "physical" contracts be recharacterized as swaps? 5. Collateral other than cash and LC's - can it be liquidated without relief from the stay? Ed Essandoh, an attorney with EES, will be faxing to you a copy of the Energy Management Agreement that EES has with Polaroid Corporation. We would like for you to review it and give us your thoughts on whether it would qualify as a forward contract. Ed's direct dial number is 713-345-8939. Can you contact my assistant, Sandy Haldeman, to schedule some time for Ed and I to talk to you about the above? Sandy's direct dial number is 713-345-3879. I will be out of pocket most of tomorrow morning but feel free to call Ed directly with respect to the Polaroid contract. We have assumed that your firm will not have a conflict on this but if this is a problem, please let us know.

Subject: "Happy Hour".

Body: Mike, Sorry I missed you guys Friday night. I made back from a golf outing around 9 pm, but you guys must have already left the Front Porch. Anyway, I was out the other night and met some Dynegy talent that were interested in an Enron Analyst/Associate and Dynegy Pace Program happy hour. What do you think about the prospectsof a combined happy hour. They have a group that goes out on the third Thursday of every month, which would be this Thursday. Mat

Subject: "snl".

Body:
Sara, I will request a copy from SNL but I also want to give this a few days so we can see what happens with Enron. Gary did approve yesterday. Sheila