In re M/V PACIFIC VIRGO

Alan,

This will confirm your instructions that for the time being, I will be
reporting to you and the other above-referenced people. I also understand
that David Best and I will not be further involved in development of a
resolution of the ECT/FGH agreement issues, and will confine our efforts to
resolution of the cargo contamination matter. Per you instructions, in order
to keep from inundating Janice Moore (who will be working on the ECT/FGH
agreement issues) with e-mails, I will not be reporting to her for the time
being.

The following are action/status items:

1. ACTION: I would like to have your authority today for Best to retain as
ECT's chemist in the contamination matter Steve Jones of APC Consultants, who
is based in London. Jones is reportedly well-regarded in the London legal
community, makes a good witness, and has the right background for this kind
of matter. I am told that the best available chemist in Singapore has a
background more oriented to fire investigation cases. Jones charges a daily
rate of 725-755 pounds per day, which David relates is very reasonable for
his services.

Best will be sending Jones relevant documentation to review at the opening
of business tomorrow in London, with the plan of then getting Jones'
preliminary advice on Wednesday, including the critical element of the
testing procedure to be used at the joint analysis that is being scheduled
for Singapore next week. If it proves to be our best strategy to have Jones
attend the joint analysis in Singapore, Jones will undoubtedly be charging
transit time in addition to his expenses.

I think that this case may boil down to a "battle of the experts" and that
it is important to have our "first team" in place before the joint analysis,
whose results may critically affect our case.

2. STATUS: On a related matter, we are still in the process of determining
what damages ECT has sustained in this cargo contamination case over and
above the approximately $300,000 diminution in value sustained with respect
to the product that was discharged in the Phillipines. As you know, the bulk
of the product had earlier been discharged in Thailand, where it remains in
storage. That product had not been nominated by FGH at the time of
discharge, but I believe it was the case that it was supposed to meet FGH's
specs in case FGH wanted to nominate it (Matt, please correct me if I am
wrong). I believe that ECT's traders are still trying to arrange for the
disposition of that cargo. I would not be surprised if ECT's contamination
claim approximately doubled once the Thailand cargo is ultimately disposed
of, although at this point I am really just speculating.

3. STATUS: Matt asked Best what he thought the approximate cost would be to
ECT of arbitrating this cargo contamination case. Based on an arbitration
that Best thought would last at least one week, and not including any
pre-arbitration development, Best gave a rough, preliminary estimate of
125,000 pounds. Best mentioned that if ECT won (which means that ECT both
recovered on its cargo contamination claim and was found ultimately not to
owe any unpaid freight or demurrage), ECT would likely be awarded
approximately 2/3's of his fees, and a larger share of his expenses (such as
the barrister's fees, the fees of our surveyor's, etc.).

4. STATUS: the statement of Eric Tan and a colleague involved in discussions
with Mitsubishi regarding tank washing will be taken by us shortly.

I will continue to keep you closely advised. Please don't hesitate to call
if you have any instructions.

Britt