Re: YPF Consent

Please note that all of the communications below are priveleged and
confidential attorney client communciations.

What do you think the possible liabilities are from the Toxic Waste created
below. Ouch !!! Maybe the attorneys need to conduct a seminar.

John Novak
02/28/2001 06:42 AM
To: Richard A Lammers/SA/Enron@Enron
cc: Eddy Daniels/NA/Enron@Enron, Richard A Lammers/SA/Enron@Enron, "Lefler,
Dean" <dlefler@velaw.com<, Rob G Gay/NA/Enron@Enron, "Federico Cerisoli
(E-mail)" <federico.cerisoli@enron.com<, "Gabriela Aguilar (E-mail)"
<Gabriela.Aguilar@Enron.com<

Subject: Re: YPF Consent

Please note that all of the communications below are priveleged and
confidential attorney client communciations.

In the future, please remember to mark all such emails "CONFIDENTIAL/ATTORNEY
CLIENT PRIVILEGED COMMUNICATION".

Thank you.
John

Richard A Lammers
02/26/2001 07:33 PM
Sent by: Richard A Lammers
To: Eddy Daniels/NA/Enron
cc: Richard A Lammers/SA/Enron@Enron, "Lefler, Dean" <dlefler@velaw.com<, Rob
G Gay/NA/Enron@Enron, "Federico Cerisoli (E-mail)"
<federico.cerisoli@enron.com<, "Gabriela Aguilar (E-mail)"
<Gabriela.Aguilar@Enron.com<, "Novak, John (Enron)" <john.novak@enron.com<

Subject: Re: YPF Consent

this is also an ok approach .Please clear with Eddy

From: Eddy Daniels on 02/26/2001 02:45 PM CST
To: Richard A Lammers/SA/Enron@Enron, "Lefler, Dean" <dlefler@velaw.com<, Rob
G Gay/NA/Enron@Enron
cc: "Federico Cerisoli (E-mail)" <federico.cerisoli@enron.com<, "Gabriela
Aguilar (E-mail)" <Gabriela.Aguilar@Enron.com<, "Novak, John (Enron)"
<john.novak@enron.com<
Subject: Re: YPF Consent

Rick, Dean & Rob --

I have some hesitations about having the Bank say re the conditions to the
GSA cannot be satisfied. I suppose we are not really concerned that YPF will
anticipatorily cancel the GSA, but t would seem to be an invitation to them
to do that.

Also, do we really want the Banks to say it is not fruitful to proceed with
the consent? Would it be better for the Banks simply to stick to their guns
re the consent, decline all of YPF's suggested changes, and insist on their
version of December 2000. That way, YPF could be portrayed as partly to
blame for failure to achieve a financial close by May 4, 2001. It might help
deflect the argument that we had control over all of the C.P.s and rigged it
to get out of the GSA.

What do you think?

Richard A Lammers
Sent by: Richard A Lammers
02/26/2001 01:15 PM

To: "Lefler, Dean" <dlefler@velaw.com<
cc: "Lammers, Rick (Enron)" <richard.a.lammers@enron.com<, "Gabriela Aguilar
(E-mail)" <Gabriela.Aguilar@Enron.com<, "Federico Cerisoli (E-mail)"
<federico.cerisoli@enron.com<, "Novak, John (Enron)" <john.novak@enron.com<,
"Eddy Daniels (E-mail)" <Eddy.Daniels@enron.com<, Rob G Gay/NA/Enron@Enron
Subject: Re: YPF Consent

Please proceed along the lines you suggest in your discussion with schumacher
and Rob/Rick needs to talk to the business people at the Bank. Lets see if
the Lenders can respond in writing.

"Lefler, Dean" <dlefler@velaw.com< on 02/26/2001 02:24:27 PM
To: "Lammers, Rick (Enron)" <richard.a.lammers@enron.com<
cc: "Gabriela Aguilar (E-mail)" <Gabriela.Aguilar@Enron.com<, "Federico
Cerisoli (E-mail)" <federico.cerisoli@enron.com<, "Novak, John (Enron)"
<john.novak@enron.com<, "Eddy Daniels (E-mail)" <Eddy.Daniels@enron.com<
Subject: YPF Consent

A quick update in regards to Doris Rodriguez's letter regarding the YPF
Consent:

I have left a message for David Schumacher asking that he call me to Doris's
letter. Given the current status of things, it would seem to me that there
is no value in proceeding with the consent. On the other hand, we need to
continue to build our case in the event of an arbitration with YPF. It
would seem to me that the best thing would be for the lenders to tell Doris
that the lenders' understanding is that, under the current project
schedule, the conditions precedent under the YPF GSA cannot be satisfied,
and that Enron and YPF have had some discussions regarding this issue and
will continue to discuss the issue. Until the YPF GSA is restructured in
some form, there is little value in proceeding on the consent, especially
given that YPF and the lenders are still so far apart on the consent.

The status of the YPF consent is as follows: Doris sent a revised draft of
the consent to the lenders in August 2000. The lenders responded with
comments (which included several of my comments) in October 2000. Doris
then responded with a counter-draft in December 2000. Doris' latest draft
again had numerous, significant comments, which I have not thoroughly
reviewed. A quick review, however, indicates that Doris has cut in half
many of the time periods for the lenders to cure SCG defaults. In addition,
Doris has restructured several provisions in order to make certain YPF
commitments run in favor of SCG only and not the lenders, which may be of no
value to the lenders in a situation in which the lenders have to step into
SCG's shoes. I am confident that the lenders will not accept Doris's
comments, since many are proposals the lenders have rejected before.

Let me know whether I should suggest to Dave Schumacher a response to Doris
along the lines I recommend.

Regards, Dean
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