Gaza Project - OPIC Political Risk Insurance

Mike / Jeff - As a follow-up to our meeting last week, here's a summary of
our political risk insurance on the Gaza Project:

Insurer: OPIC

Insured: Enron Corp & Affiliates

Amount: Aggregate of $60M may be claimed, sub-limited for separate coverages
as follows:

(A) $22.5M - Expropriation (equal to the "Book Value" of Enron's investment)

(B) $60M - Political Violence / War (excluding violence from labor strikes
or student unrest)

(C) $10M - Currency Inconvertibilty / Non-transferability

Term: 20 years from July 2000; policy is non-cancellable

Rate on Line: 100 bps pa for coverage (A); 90 bps pa for (B); 36 bps pa for
(C)

Certain deductibles, exclusions and waiting periods apply, according to
industry norms; in addition, if we were to make any expropriation claim, or
a political violence claim where we were not going to re-build the facility
with the proceeds, we would have to deliver shares representing all or a
portion of our interest in the project to OPIC in order
to receive the claim payment. This is a problem, because the project
shares have been pledged to the lender(s) as part of the project financing
security package.

As to the status at the site, the immediate crisis seems to have abated. No
expats are on site, but various sub-contractors are available to do work.
The problems is transporting material and equipment to the location. We are
about two months behind schedule.

Cliff