The times they are a changin.

We plan to meet with these guys directly and through NIC (they have strong relationship with Tohoku) in the very near future to talk about other coal based derivatives and structures (Sydney is involved).  This effort was already underway before this announcement.  I met the President of Tohoku about two weeks ago and indicated possible opportunities.  We are trying to repair relationships here as EPower's major (and premature) announcements at the beginning of the year pissed them off to no end.

Joe

 -----Original Message-----
From: 	Watanabe, Mika  
Sent:	Thursday, November 01, 2001 10:02 AM
To:	DL-Tok EPower; Crowther, Mark; Kimura, Takashi; Thirsk, Jeremy; Hirl, Joseph
Cc:	Imai, Makiko; Grimes, Michael; Hughes, Llewelyn
Subject:	Tohoku Elec To Buy Coal, Emission Allowances Together


Thursday, November 1, 2001
Tohoku Electric To Buy Coal, Emissions Allowances Together 


TOKYO (Nikkei)--Tohoku Electric Power Co. (9506) announced Wednesday that it has agreed to purchase coal and gas emissions allowances from two Australian firms as a set, marking the first deal in Japan in which fuel and emissions rights have been bought in this manner.

Tohoku Electric will sign with Powercoal Pty Ltd. and Centennial Coal Co. a multiyear contract taking effect in fiscal 2002. The two partners will supply the Japanese firm with coal as well as emissions allowances gained by reducing gas emissions in Australia. The price and volume of the allowances have yet to be determined.

Powercoal expects to reduce carbon dioxide emissions by about 1.6 million tons a year by collecting methane gas produced through coal mining and other activities. Centennial Coal plans to reduce CO2 by 25,000 tons a year by planting trees.

Tohoku Electric officials believe that gas emissions allowances will eventually be traded on a market, but that they would be able to purchase them more cheaply if they signed a contract before an emissions trading system is started.

(The Nihon Keizai Shimbun Thursday morning edition)