May I please have your comments if any on this draft by close of business Wednesday.  We hope to have agreed on the Q&A's by then and to send it out the announcement on Thursday.

John

To be sent to:  All Enron Europe, all employees in Japan,  all Global Markets and all VPs and up around the company

Enron has established several wholesale businesses in Japan in the last year including Metals,  Power Plant Development (via our investment in EnCom),  Coal,  LNG & Weather.   Though Japan continues to make progress towards a liberalized electricity market, significant barriers to power trading remain under the current interim market structure.  Until further tangible steps are taken to improve third party access for electricity in Japan, we will suspend our power marketing efforts and focus on the significant opportunities that currently exist in our other wholesale businesses.   Once the necessary regulatory changes have been completed we expect to aggressively pursue Enron's traditional position as the leading buyer and seller of electricity in every deregulated market.  

Based on these changes Joe Hirl our President of Enron Japan will move to the Global Markets group and lead a team that will focus on developing all our Global Markets opportunities in Japan especially Weather,  Oil,  LNG,  Coal, and Shipping.    We expect to continue our general recruiting  of Japanese nationals and as President of Enron Japan,  Joe will continue to provide the overall business leadership to both recruiting and the Analyst and Associate program in Japan.  The Finance origination team headed by Jeremy Thirsk will continue to report to Joe and also move to Global Markets.  Our power trading group led by Morton Erik Pettersen will transition into other roles around Enron.  The Equity/FX/Interest rate team which is a part of Global Markets has two employees in the Tokyo office today and they expect to expand their efforts throughout the year.

The EnCom group, which is our power plant development business (with minority partners) and headed by Carey Sloan will continue its efforts in developing power plants in Japan.  We are pleased with the progress we are making on a number of sites and EnCom will continue to report to the Enron Europe Office of the Chairman.

Our Metals team headed by Kazunari Sugimoto will continue to report through Enron Metals in London.

By May we expect Enron Credit to have two to three employees in Tokyo pursing the Credit Derivative business.  These employees remain in  Enron Credit , a part of Enron Europe.

EBS has two employees headed by Jim Weisser and this team expects to expand  by year end.

The Industrial Markets team also expects to have two employees in the Tokyo office in the next couple of months.

In the last seven months the commercial support services for Japan have been transitioned to London for support and this is not changing.  Jane McBride heads the legal team and will continue to functionally report  to Mark Evans, General Counsel in London.   The RAC function will continue to report to Ted Murphy, head of RAC for Enron Europe.   The Risk Management and Accounting team is headed by Jan-Erland Bekeng will continue to functionally report to Fernley Dyson in London.  The  IT, HR,  Tax and real estate teams will also continue to functionally report to London. 

Nick O'Day who heads both the Public Affairs group (Government & Regulatory Affairs and the Public Relations) in Japan will report to the Enron Europe Office of the Chair with a Public Relations functional reporting to Jackie Genle in London and a Government Affairs functional reporting to Rick Shappiro in Houston.   We anticipate that his team's efforts will be primarily directed to supporting the EnCom power plant development team but he will also continue to provide support for Global Markets, EBS & Industrial Markets.

We have already made considerable progress in breaking into the Japanese markets across a wide range of Enron businesses and we anticipate that this will be a major profit center for profit growth for years to come. Through these current changes we can demonstrate our ability to be flexible and target our resources where they will realise the most immediate value for the company.