Subsequent to our swap group meeting with Clement last week, I have discussed 
the issue further with Jeff Hodge, Peter Keohane, Russell Diamond and Clem.  
In addition to ENA, ECC is feeling the pressure of delays for obtaining 
corporate guaranties caused by increased guaranty requests, too few signers 
and insufficient legal staffing to handle the volume.

Although Clem will have assistance soon, we concluded that it would be 
prudent to begin negotiation of a guaranty immediately rather than wait for 
the conclusion of the master agreement (or confirmation) negotiations.  
Please try to incorporate this approach, particularly with Canadian 
counterparties. 

Credit will continue to push our internal form of Enron Corp. guaranty.

Sara Shackleton
Enron North America Corp.
1400 Smith Street, EB 3801a
Houston, Texas  77002
713-853-5620 (phone)
713-646-3490 (fax)
sara.shackleton@enron.com