Phelps Dodge

C:

I spoke to Choi Lee today. It is hard for me to remain professional with him
as his arrogance and illogic is very frustrating, but our discussion was very
cordial. He indicated that Enron has not brought forth any proposal of
substance. This apprarently means we have not offered them energy at below
market prices. I indicated that should he find some of that energy in the
"$50 - $60" range to give me a call as we would be willing to buy in the "70s
and the 80s." I was not able to learn when he would be in the market to buy,
but I encouraged him to give me a call if he wanted a price quote. I don't
have much confidence that he would call even if he was buying. I will leave
it up to him to call rather than make this a priority to chase as the
opportunities with PD seem to be limited. If they do need energy I expect
they will keep the term short and shop it pretty hard. There mining
operation plans seem tenuous and they think prices are going to fall. With
APS and Salt River out there in the shorter duration markets we wouldn't make
much money anyway.

Please do not hesitate to call if the situation changes and you need a
electricy price quote for a structure you are working on.

Thanks!

Chris