EPA advance notice to regulate MTBE under TSCA

The EPA today issued its "Advance Notice of Intent to Initiate Rulemaking
Under the Toxic Substances Control Act (TSCA) to Eliminate or Limit the Use
of MTBE as a Fuel Additive in Gasoline." As brief background, TSCA allows
EPA to issue rules regulating chemical substances where there is an
"unreasonable risk to health or the environment." Such rules could lead to
various levels of regulation of the manufacture, processing, or distribution
of MTBE, including a complete ban or substantial limitations on use.

The purpose of such this notice is to request comments as to whether EPA
should go forward with a proposed rule. Comments are due by May 8, 2000. If
EPA decides to move forward with a proposed rule, our sources indicate this
would not likely occur for at least 6 months, as EPA first has to deal with
comments on the current "advance notice" and make some decisions before
proceeding.

OFA will be submitting comments on behalf of MTBE producers, and will be
working to get other groups like the Chemical Manufacturers Association and
American Methanol Institute to comment as well. They have also suggested
that individual companies provide comments to EPA as well.

I have asked the regulatory and technical analysis staff in Enron
Environment, Health and Safety to review the EPA document and provide
recommendations as to the viability of EPA's efforts to regulate MTBE under
TSCA, the possible impacts on Enron's MTBE operations if TSCA regulation were
to be finalized, and the potential areas where Enron might best comment.

I would appreciate your initial comments on whether it is appropriate or
advisable for Enron to provide comments for the EPA record in this "advance
notice" stage. While our technical staff should be able to provide some
recommendations based on their review, the broader, political issue is
whether Enron should engage in the TSCA debate at all, given our pursuit of
more of an "exit strategy" for our MTBE asset (stranded costs, liability
protection).

Please let me know your views as soon as possible. I will forward analysis
from our technical team as soon as it is available.

Thank you.

Jeff Keeler
Director, Environmental Strategies
Enron Corp. -- Environment, Health & Safety
Washington, D.C.
(202) 466-9157
(202) 828-3372 fax