Project Triple Lutz

To date, my primary duties have been to oversee the internal valuation of the
contracts, and their unwind costs in our Risk books. I have also been
involved with the Entex contract valuation. Dave Baumbach has been the real
key to providing the data, and has all of the information. Steve Jackson is
talking with Ed McMichael of Structuring on Monday to get some additional
eyes and resources looking at this also. I feel we have done a thorough job,
but we do need everyone thinking of "what if's." Our risk books are complex,
with many hand-offs internally. Obviously our goal is to ensure that all of
the stones have been turned, and there are no surprises at the end of the
day. I think Structuring will really be helpful in this arena. After our
meeting yesterday, I believe everyone is much more comfortable in our
approach. There were a couple of things that Dave was going to follow-up on
(Fixed-price deals, especially Calpine).

FYI: I will be out of town on another project all of the week of 8/28 - 9/1,
and Tuesday, 9/5 and Wednesday, 9/6. I have made arrangements to ensure that
I am in Houston on Thursday, 9/7 and Friday, 9/8 for the first visit to the
Triple Lutz data room.

In my absence next week, I want to reiterate to each of you that I am
available, and will have the Triple Lutz data with me. If any issues come up
that you feel I can be helpful, please contact yvette Connevey @
713-853-5953, and she will get in touch with me. Once again, DO NOT HESITATE
TO CALL ME!!! I do not want anything falling through the cracks!