Reserves and P&L

This memo documents the timing of when we set aside reserves for the Colorado
Springs Utility deal. It also documents the history of money flowing into
and out of Matt Motley's P&L. This is simply an fyi -- there is no action
needed from you.

The net effect is that we have a $10 million reserve set up for CSU. With
respect to trader performance, $5.2 of that came from when Kevin McGowan
managed the book (his entire ytd earnings before he moved to coal) and $4.8
came from Motley's P&L. I thought it would be useful to record it in a
quasi-official manner to give Motley comfort that he won't get dinged for an
old shitty deal that happened before he arrived.

Tim
---------------------- Forwarded by Tim Belden/HOU/ECT on 05/23/2000 02:36 PM
---------------------------

Enron Capital & Trade Resources Corp.

From: Matt Motley 05/23/2000 11:46 AM

To: Tim Belden/HOU/ECT@ECT
cc:
Subject: