Nissho Iwai (project Sato):  We have spent a considerable amount of time over 
the last couple of weeks defining what Enron could do for them and building a 
level of trust and understanding.  Recall that a couple of their board 
members had come to us about a month ago to discuss a USD2-3 billion near 
term liquidity "issue".  On Friday their strategy planning group will be 
taking the proposal of cooperation with Enron to their president and some of 
their key advisors at Sanwa Bank and DKB.  We have proposed the means 
(without specific definition) of how we could provide near term liquidity and 
set the path to look for opportunities in key business areas.  Almost all the 
areas of interest are in key Global Market products.  Sanwa and DKB are part 
of the equation as they worked out a rescue deal for NI a year ago.  This 
plan also had the support from Hiyami (former NI president and now head of 
BOJ).  So any decision to handle their near term problems and future growth 
would have to get support from these key groups.  The NI team we have been 
working with seem quite positive on their prospects of getting this through 
Friday's meeting.  From this point we would proceed with a very detailed due 
diligence effort across key areas which will be mutually defined, but 
would/could include: LNG, coal, petchems, shipping, freight, metals, etc.  We 
would determine how much we could pay for certain rights and/or positions.  
If we could get something done this would have a huge impact on the market 
and would give us tremendous reach to other Japanese customers in their 
group.  During this "liquidity solution" phase, we will also be evaluating 
areas of growth and of mutual interest to our companies.

Hitachi: weather ventures: The #3 guy in Hitachi came to us a couple of weeks 
ago indicating that they thought there could be tremendous possibilities for 
Enron and Hitachi to jointly market weather products in Japan.  Note:  we 
have been discussing possibilities with Hitachi since Ken Lay visited.  
Hitachi does not have any weather experience, but does have a tremendous 
customer base, a large sales force and a very strong name in Japan.  As 
Hitachi are involved in just about everything, they also have business lines 
in the capital markets area and insurance.  Hitachi senior management has 
strongly implied that if we can get something done then they can deliver 
quite a few companies including the large utilities.  They could also give us 
access to the Japanese insurance companies... beyond the Marine and Fires.  I 
believe that the president of Hitachi has already decided that they want to 
do this.  In fact, in true Japanese style, they have mentioned to TEPCO that 
they would be pursing something like this with Enron to "sort of" get 
permission.  Hitachi could be quite useful in getting us further access to 
the utes for fuel deals as well.  What we have contemplated (and discussed 
with Tawney) is an arrangement where Enron provides the pricing for standard 
and structured products and takes on the risk of transactions (risk books 
outside venture) while Hitachi provides the customers and a trained sales 
force.  In return, Hitachi gets some sort of agency fee for each deal done.  
Hitachi also has tremendous weather risk themselves that they would be 
looking to manage from a corporate level.  They have wanted to race to an 
MOU, but we have brought them back to a CA first.  We'll be getting more 
definition over the next couple of weeks with the idea of having advanced and 
productive discussion with Tawney when he is over the middle of next month.  
Needless to say, getting something like this done with Hitachi would be a 
tremendous boost to our local credibility and would open many doors.

Nissho Iwai: methanol:  We will be presenting an indicative term sheet to 
Deutsche Bank tomorrow concerning a prepay structure for 100k+ tons of 
Methanol for up to three years out of Bontang.  We have been able to work 
down the CDS spreads from the international market for Indonesia and NI down 
from 1750 bps over Libor to approx 600.  The structure would likely involve a 
trade finance arrangement with one of the Japanese banks (with sufficient 
Bank of Indonesia deposits) providing coverage for the Bank of Indonesia who 
would provide the local performance gtee.  This is a unique arrangement that 
the Jp banks have with Indonesia.  Also the general feeling amongst Jp 
trading companies and banks is that they are already pregnant with Indonesia 
and a little more doesn't matter.  Basically Indonesia is in the national 
security interest of Japan and therefore Jp govt and institutions will 
provide support.  I have mentioned the possibility of this to Stu to consider 
other ways to manage coal risks.  Prepay would likely be in the range of 
USD30-40 million.  Nowlan has indicated the possibility of greater volumes, 
so will work variables as we get feedback from NI/DB.  For a more detailed 
discussion see internal writeup: 

Joe


Joseph P. Hirl
Enron Japan Corp.
81 3 5219 4500
81 3 5219 4510 (Fax)
www.enron.co.jp