Jeff, 

FYI.  This is an excellent email and one that addresses all the issues we 
need to make decisions on.  Lets discuss because I have some views but am 
very open to others especially when I don't really know (first hand) what 
oppts really look like there.  We need to address quickly.

Mike
---------------------- Forwarded by Mike McConnell/HOU/ECT on 05/03/2001 
10:53 AM ---------------------------


Morten E Pettersen@ENRON
05/03/2001 03:15 AM
Sent by: Morten E Pettersen@ENRON
To: Mike McConnell/HOU/ECT@ECT
cc:  
Subject: Tokyo opportunities

Hello Mike, 

I tried to call you several times yesterday but you were busy all the time. 
The reason why I called is that I have some questions that I will like your 
input on before I take a decision. I will try to call you later today but 
here are some of the questions.

You and Jeff talks about a senior position for me. What do you mean by that 
and what will Joe's position be. Will he still be the "president" or will he 
take a more active role on the origination side. What will Jeremy's role be. 
Today he does all these senior structuring deals with EGM products.

Focus. There are very many commodities to look at here but since we have 
limited resources at this stage we need some focus in the beginning. If we 
look at everything at once - nothing will happen.

There are two areas that looks "easy" to start with. Softs and Liquids. How 
willing are EGM to focus on these in the beginning. The reason for I call 
these areas "easy" is that there are big and very liquid liquids and soft 
markets here and it therefore will possible to do transactions early to get 
some momentum in the business. The other markets have large potential but 
will take much longer time to develop. I look at Equity/FX/Interest as 
something Darren will continue focus on.

When some of these markets start to develop and we will have some marketing 
activities/trading going on where will the books probably be and to whom will 
we report. If we do Softs will it be to Gary or will it be to Jeff. How will 
it be integrated. I have no problem with say reporting liquids etc to John 
Nowlan, Softs to Gary, weather to Mark. I think this will be a good solution 
because it will force them to follow us up and it will be easier to 
communicate strategies back and forth etc. The situation today on weather is 
something that I do not like. We have the book, but we do not have any real 
support from Houston or real responsibility. If that is the situation we will 
soon have a lot of problems. It is not a secret within Enron that the 
Singapore oil situation, coal in Asia/Australia and the weather in 
Scandinavia/Europe are not optimal. For me to take a decision I will need to 
know that there are support and willingness from all the heads of EGMs 
different commodities for developing the possibilities in this region, not 
only from you and Jeff. I do not want to use all my time fighting internal 
battles, but I know that it will be hard work to make a business grow.

Staff. In my power trading group today I have 2 managers and 9 AAs. The 
managers + 2 Asso are what I call marketing guys and the rest are analysts 
(some with trading potential). We have no one with trading background in EGM 
products so that need to be recruited. At the same time many of these AAs 
have started within the last 6 months so they are not fully Enronized so it 
would be a good idea to send over some AAs or managers to teach people models 
etc. 

You mentioned Singapore in the TC, what will happen with them?

How does EGM reward people for starting up businesses. It was almost 
impossible to get someone to help me building up the power here (both London 
and Houston). People, especially not traders, do not want to leave a 
profitable book or origination activities. Quite many got the feedback in 
last PRC that they need a number to their name, both P&L and number of 
originated deals, so they did not dare to leave. How will that be handled 
here?

I think my main strength is trading, and I prefer to do trading, but I have 
quite good origination skills. Iknow that in a start up process you need to 
do both and I am more than willing to do that. 

This was a lot of questions but to get some feedback on them are necessary 
for me to take a decision. I will probably go to London on Wednesday and 
Thursday next week to speak with Sherriff etc. I will try to call you later 
today

Regards


Morten Erik