Joe, part of this deal is repayment of the sub debt at par and a series of 
cashflows that we would probably like to monetize.  Have you looked at this?

Jeff, I would like to get your view on the economics - basically they are 
giving us 89% of our carry value in cash and 11% of our carry value in a 
contingent payment payable at restructuring or sale of their partnership.  
Lets discuss ASAP.

Regards
Delainey
---------------------- Forwarded by David W Delainey/HOU/ECT on 09/25/2000 
08:10 PM ---------------------------
   
	Enron North America Corp.
	
	From:  Brad Alford                           09/25/2000 05:34 PM
	

To: David W Delainey/HOU/ECT@ECT
cc: W David Duran/HOU/ECT@ECT, Joseph Deffner/HOU/ECT@ECT 
Subject: El Paso/ECP

At Dave Duran's request I have attached for your information two files 
containing a term sheet from El Paso reflecting the final terms as negotiated 
and a spreadsheet analysis of the valuation of that offer ($206.6mm).  The 
offer analysis uses a discount rate on the El Paso Deferred and Scheduled 
Payments of 8.25%.  This rate is the middle of the range of a recent quote 
from Treasury/RAC as to the expected rate at which we will be able to 
monetize this payment stream.  The Contingent Payments are in the form of a 
residual preferred partnership interest that we will retain and are 
discounted at the current project rate with a probability adjustment.  The 
residual partnership interest should allow us to fair value these contingent 
payments (as we are currently doing on the existing contingent payments) and 
should also be beneficial to the tax structure of the transaction.