Petrogulf

Dan here is another contract for the Denver office. Let's discuss the Bear
Paw issue. Thanks. Shonnie
---------------------- Forwarded by Shonnie Daniel/HOU/ECT on 08/27/99 06:04
PM ---------------------------

From: Dan J Bump 08/27/99 01:57 PM

To: Shonnie Daniel/HOU/ECT@ECT
cc: Gerald Nemec/HOU/ECT@ECT
Subject: Petrogulf

Sorry, I forgot one last point that Bill Whitaker (Petrogulf) mentioned to me
last nite. Bear Paw is gathering +/-4,000 mcf/d from Petrogulf's wellhead
into Fort Union. Since Bear Paw does not buy gas nor has capacity on Ft.
Union, Petrogulf would like us to include this gas under the MDQ and purchase
(or gather) this volume under these agreements. I guess we could just
identify this receipt point separately on an exhibit and attach a lower
gathering fee (i.e. $0.145/mcf to cover Ft. Union capacity).

I hope this made sense.....Thx.

Dano
---------------------- Forwarded by Dan J Bump/DEN/ECT on 08/27/99 03:00 PM
---------------------------

Enron Capital & Trade Resources Corp.

From: Dan J Bump 08/27/99 01:50 PM

To: Shonnie Daniel/HOU/ECT@ECT
cc: Gerald Nemec/HOU/ECT@ECT
Subject: Petrogulf

Attached is a draft term sheet for Petrogulf. Bill Whitaker has not seen
this letter yet, however it reflects verbal discussions we have had regarding
terms of a potential deal. In the interest of time and to be proactive, I
would like to send Petrogulf a draft contract with these terms included ASAP
for their review. This acreage is adjacent to MTG, so its very competitive.
Additionally, Petrogulf plans to have +/-100 wells drilled by year-end, so
could be a lot of early gas coming our way!

Thanks.

Dan