Enron Weather Derivatives

Dave,

Just wondering if you have had a chance to consider these new risk management
tools we are considering.

Thanks!

Charlie Weldon
Enron Corp - Houston
---------------------- Forwarded by V Charles Weldon/HOU/ECT on 12/14/2000
10:10 AM ---------------------------

Enron North America Corp.

From: V Charles Weldon 11/13/2000 08:28 AM

To: David.J.Maier@usa.dupont.com
cc:
Subject: Enron Weather Derivatives

Dave,

Thanks for taking time to talk with me the other day. To recap what I was
asking you to consider, we at Enron currently have two different weather
derivative products under development that we believe could be of interest
to Dupont. One of the products involves protection against
hurricane-related production disruptions. The exact form of the product
could vary but would generally provide for coverage against lost revenues
due to hurricane warnings or general proximity of hurricanes near the
coastline. We would be able to structure this offer with maximum
flexibility with regard to category of hurricane, level of coverage, exact
proximity, and pricing (swaps or options).

The other product line we are considering is a drought-related product that
keys off of low riverflow values on various river basins in Texas. We
believe that the Guadalupe River in particular is susceptible to extremely
low riverflow values that could potentially result in production
disruptions to the downstream chemical industry that relies on the river to
meet cooling needs. A review of 50 years of riverflow data (from the US
geological survey) suggests that if a drought of the magnitude of the one
in the 1950's were to reoccur, there is potential for multiple prolonged
production disruptions to many of the large chemical plants on this river,
including the Victoria Dupont plant. The exact form of coverage offerred
would again depend on your specific needs.

Both of these products are in a stage that we need to determine whether or
not there is sufficient market interest to warrant further development.
Your feedback on whether or not these products might be of any interest to
you would be greatly appreciated.

On one other note, you mentioned that the agricultural business of Dupont
was considering some rainfall derivative contracts for hedging purposes.
We are very interested in discussing your needs versus our capabilities
with regard to this type of product. Our marketing contact for this
subject is Valter Stoiani and he can be contacted by phone at 713-853-6906
or by E-mail at valter.stoiani@enron.com.

Thanks again,

Charlie Weldon
Enron Corp - Houston
713-345-7229