Status - Project EWE II

The information books should be in everyone's hands by about 8:30 Thursday
morning. Let me know if you have any trouble getting your copy. Michael
Ratner is now building a baseline economic model for each of the four (4)
assets using data presented in the information memoranda. Once the model
works, we will be able to modify the data to run various cases for various
asset combinations. We need to identify all synergies and any other areas of
special consideration that could impact our valuation (i.e. does ownership of
Minnegasco provide any strategic opportunities, any value in the AC line
access to northeast pipelines, etc.)

You should soon receive another smaller packet from Merrill Lynch describing
two different deal structures for our consideration - one is a "prepaid
lease" arrangement, the other a "leveraged partnership".

I am trying to set up a meeting with Robert Eichenroht to discuss PUHCA
issues and how this deal would be impacted if we were to include either the
Arkla LDC or Minnegasco package.

Non-binding EOI's are due next Wednesday and time is short. Bill Cordes will
be in Houston next Tuesday and we have tentatively scheduled a group meeting
for 8:00 AM. [Location not yet confirmed, but we will try for a video conf.
room so Omaha can participate.] Please mark your calendars.

JNG