Message-ID: <32111320.1075844287609.JavaMail.evans@thyme>
Date: Tue, 12 Dec 2000 23:03:00 -0800 (PST)
From: rod.hayslett@enron.com
To: jerry.martin@enron.com
Subject: Lease Option on Trailblazer
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FYI.     This was the detail provided to Sarabeth.
---------------------- Forwarded by Rod Hayslett/FGT/Enron on 12/13/2000 
07:04 AM ---------------------------

12/11/2000 10:07 AM
John Jesse


To: Sarabeth Smith/OTS/Enron@ENRON
cc: Rod Hayslett/FGT/Enron@ENRON, Jerry Peters/NPNG/Enron@ENRON 

Subject: Lease Option on Trailblazer

To recap our recent discussion, my understanding was that you were looking 
for an Enron or NBP entity to serve as the lessor in a lease financing 
transaction that would be offered as an option in the pending EAMR bid for 
the Trailblazer construction project.  Since such transaction would need to 
be priced based upon the credit rating of the entity or the sponsors 
(depending upon the structure) the expected returns will not justify the 
balance sheet impact on Northern Border Partners if this entity were to 
function as lessor.  Furthermore, I have assumed that this conclusion also 
holds true from Enron's perspective given their strategy of reserving balance 
sheet capacity for higher return projects.

Since the bid parameters do not specify a lease requirement, Trailblazer may 
already have funding in place.  If not, EAMR could insert language in the bid 
that they or their designee would arrange lease financing for the project 
upon selection of EAMR as the winning bidder.  At that point, we would work 
with commercial banks or major leasing companies to develop a cost-effective 
financing transaction.

I hope this addresses your questions regarding the feasibility of such a 
transaction, but please call me at x7843 in Omaha if you wish to discuss 
further.  Good luck with your bid!