EECC'S ROLE AND MISSION

Jeff, FYI, good summary email.

As we get bids for Project Jose, we should keep him informed but move
forward with getting the competitive bids.

mike
---------------------- Forwarded by Mike McConnell/HOU/ECT on 11/16/2000
03:06 PM ---------------------------

Larry L Izzo@ENRON_DEVELOPMENT
11/15/2000 03:35 PM
To: John Sherriff/LON/ECT@ECT, Mike McConnell/HOU/ECT@ECT, David W
Delainey/HOU/ECT@ECT, Rebecca McDonald/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT,
Sanjay Bhatnagar/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, James M
Bannantine/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc:
Subject: EECC'S ROLE AND MISSION

Several developers in your groups have asked questions recently concerning
the future of EECC and whether EECC would be there for them in the planning
process for future Enron turnkeys. Some of these turnkeys, like Venezuela
LNG, we are currently working on but there's some uncertainty in their minds
whether or not we'll be allowed to do the project. Let me clarify the
current situation.

Lou Pai and I have briefed Jeff Skilling as part of the 2001 budget process
and obtained his approval for EECC to continue with the following role:

EECC will manage Enron's technical and engineering risk for large asset
construction projects. EECC can perform the Enron turnkeys when we mutually
agree that we have the market price and schedule.
EECC will shut down third party work (not related to Enron projects except
for NEPCO and power projects).
EECC will leverage its approach to technical engineering and construction
risk management to develop new products and services, for example, lender's
engineering due diligence, etc.
EECC will develop an Enron Construction Risk Book for all Enron projects,
including NEPCO. (This process is underway with the help of Rick Buy's group
and should be completed by mid-December.)
EECC will transition NEPCO into our project power company. I'm beginning
this transition by moving the Enron Brazil projects and their project teams
under the NEPCO umbrella. However, NEPCO cannot manage the Arcos project in
Spain, which has already begun engineering, and I will grandfather Arcos (and
probably the second project in Spain) inside EECC.

As before, business units can bid for outside prices and schedules. I think
in that regard nothing has changed. I would like to continue working with
your teams to continue looking for the best deal for Enron on every project,
whether that's an EECC/NEPCO EPC or an outside EPC. I think we expect to
manage the outside contractors when a decision is made that the best choice
for a particular project is a third party contractor. I would like to follow
up and meet with you in due course to answer any other questions.

LI49700