Master Agreements - Cherry Picking

Anything come of this? Do we still need to speak with Milnthorp?

Bill

---------------------- Forwarded by William S Bradford/HOU/ECT on 11/20/2000
07:40 PM ---------------------------

Enron Capital & Trade Resources
Canada Corp.

From: Peter Keohane 11/13/2000 03:58 PM

To: Elizabeth Sager/HOU/ECT@ECT
cc: Mark E Haedicke/HOU/ECT@ECT, William S Bradford/HOU/ECT@ECT, Jeffrey T
Hodge/HOU/ECT@ECT, Shari Stack/HOU/ECT@ECT, Greg Johnston/CAL/ECT@ECT
Subject: Master Agreements - Cherry Picking

Elizabeth, I am responding to your voice mail that today's meeting is
canceled. I agree with your suggestion that you, Mark, Jeff, Bill and Shari
can come to a conclusion and just let us know.

I believe the issues come down to:

1. risk of intentional default by our counterparty

2. risk of unintentional default by us

3. what the market is doing

As agreed at our last call, I reviewed the issues commercially here, and I
believe the commercial preference is to maintain cherry picking for the
reasons in 1 above. Please let Greg and mw know what is decided.