Subject: Enron Pipeline Proposal
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked]
Date: Fri, 30 Mar 2001 03:17:00 -0800 (PST)

Jason,

As requested, Enron is pleased to submit its proposal to own the oil and gas 
export pipelines for the Murphy Medusa project.  The attached file is an 
addendum to Enron's non-binding proposal submitted on March 20, 2001.  All 
terms and conditions included in Enron's March 20 proposal are applicable to 
the addendum unless specifically noted within the addendum.  I will overnight 
an original signed hardcopy of the addendum to you this evening.

Enron believes that the Pipeline Structure is a very attractive opportunity 
for the Venture.  The ratio of un-guaranteed risk to the risked potential 
upside is well balanced.  The differences you may notice in the Pipeline 
Structure value compared to the value you "backed out" of our original 
proposal are due to the inherent reduced efficiency in the Pipeline 
Structure.  Specifically, 
A smaller deal size has a greater percentage of finance (bank/legal) fees.
The highly efficient capital model designed for the Combined Structure is not 
able to be used on the Pipeline Structure.
No residual value is assumed in the Pipeline Structure. 

If Enron were to be awarded ownership of the pipelines and subsequently 
awarded ownership of the FPS, the Venture would be able to take advantage of 
the Combined Structure tariffs.   

Please call me if you have any questions or comments concerning the addendum 
or Enron's original proposal.  

Regards,

Kenn Loch
713-345-8962
[email-masked]