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----- Forwarded by Jeffrey A Shankman/HOU/ECT on 02/21/2001 12:34 PM ----- Raul Rizo-Patron 02/21/2001 11:15 AM To: Jeffrey A Shankman/HOU/ECT@ECT, David McConnell/LON/ECT@ECT cc: Subject: Project Ice - Credit Summary Below is the credit summary put together by Tom Moran from our credit group. Sovereign Risk China $50MM in open credit risk at any given time with 5-8 different counterparts $30MM in inventory ENE must be willing to commit $80 to $100MM in China on an unsecured basis at Transammonia's current business level. Prepayments for supply in Ukraine and Russia Magnitudes of these prepays is not yet clear Currently a 15% reserve is being held from the prepayment date until delivery date Product is currently sourced and sold in countries with low E-Ratings and where Enron does not have much credit knowledge. Credit Risk $430M (note: thousand not million) in reported credit losses since 1995. $4MM as allowance for doubtful accounts on the balance sheet. All prepayments and L/C transactions are coordinated with credit in NY office. Credit rating system of A,B, or C $115MM in outgoing L/C are currently issued by Transammonia Unable to determine counterparty concentration risk due to incomplete A/R & A/P reporting (should be obtained at follow-up due diligence) Most petchem and LPG counterparties are well know to Enron credit Almost all fertilizer counterparties are new to Enron Raul
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