Management announcement

As you are all aware, EBS has grown to be a significant part of Enron. The=
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EBS/Blockbuster movies on-demand announcement this week, as Merrill Lynch p=
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it, =01&confirms the tremendous inroads Enron has made in the telecommunica=
tions=20
business.=018 We expect this deal to be a springboard for enabling EBS to=
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accomplish even greater things.

Because we believe that EBS is integral to Enron=01,s success, it is becomi=
ng=20
increasingly important for greater interaction among EBS senior management,=
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corporate leadership and our Houston-based business units. In short, we=
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determined that it is necessary for the CEO to be based in Houston, althoug=
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the Portland office will remain an integral part of EBS.=20

Joe Hirko as CEO and Ken Rice as Chief Commercial Officer have accomplished=
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great things, and we believe that both are completely qualified to fill the=
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CEO role moving forward. However, Joe has decided to stay in Portland for=
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family reasons, and as a result, Ken will assume the role of CEO for EBS,=
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effective immediately. =20

Joe, unfortunately, has decided to leave Enron. We want to recognize Joe f=
or=20
his role in making EBS a success. He started the business, demonstrated it=
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value to Enron management, and brought the team together to create the EBS=
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vision.

We do believe that EBS will continue to grow and succeed under Ken=01,s=20
leadership. Throughout his 19-year career with Enron, he has consistently=
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been a driving force in building businesses.

Please join us in wishing both Joe and Ken great success.