As we have referenced in our monthly report,  Enron is involved in a dispute 
with Mr. Friedman concerning his involvement in a proposed natural gas 
transportation and marketing arrangement in the Republics of Mozambique and 
South Africa (the "Pande Project").   Mark Wawro at Susman Godfrey has been 
representing Enron Southern Africa Development and Enron Oil and Gas 
Mozambique in negotiations with the Friedmans' lawyer, Jim Reed, at Looper 
Reed. 
  On January 16, 2001, the above referenced lawsuit was filed despite the 
fact that the parties had recently met to discuss their respective positions 
and had agreed to exchange documents. The lawsuit was filed in the 133rd 
Judicial District Court of Harris County and, therefore, is pending before 
Judge Lamar McCorkle.  The defendants have not been served and the 
plaintiffs' lawyer has asked Mr. Wawro to accept service on their behalf. 
 The plaintiffs allege that the defendants  breached the subject consulting 
agreement by "failing to honor and denying any intention to honor, their 
Development Fee and Investment Right obligations under the Consulting 
Agreement". More specifically, plaintiffs seem to be complaining about a 
failure of the defendants to pay a percentage of the $30 million allegedly 
received in connection with  the transfer of defendants' interest in the 
Pande Project and termination of the plaintiffs' consulting agreement  The 
plaintiffs have also demanded an accounting as well as pre and post judgment 
interest.  A specific dollar amount of the damages sought was not provided.
 Please call me if you have any additional questions about this matter.