FYI
---------------------- Forwarded by Brent Hendry/ENRON_DEVELOPMENT on 
24/02/2000 01:57 PM ---------------------------


Alexandre Bueno
24/02/2000 05:45 PM
To: Michael Guerriero/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Pablo 
Acevedo/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Bernardo 
Andrews/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Diego 
Hollweck/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John J 
Shoobridge/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Gabriela 
Aguilar/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Rodolfo 
Freyre/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Julian 
Poole/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Cristian 
Folgar/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Brent 
Hendry/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Andrea 
Calo/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Marta 
Ortiz/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Luis 
Juarros/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Guillermo 
Canovas/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc:  
Subject: CLipping 02/24/2000

BRAZIL: ANEEL'S REQUIREMENTS NOT MET BY CERJ
O Estado de S.Paulo, 24 Feb 2000, p. b-8:-
 According to a report carried out by the Brazilian National Regulatory 
Agency for Electricity (Aneel), the electricity company Cerj, controlled by 
the companies EDP (Portugal), Endesa (Spain) and Chilectra (Chile), has met 
only 53% of Aneel's requirements and 54% of Cerj's clients are being supplied 
electricity at voltage levels out of quality patterns.
Eduardo Ellery, a director of the Aneel, has stated that Cerj has already 
been fined R$ 1.398mn.
In addition, the Aneel informed on February 23rd 2000 other requirements to 
be met by Cerj:
- providing ways for Cerj's clients to rapidly and easily contact it by 
telephone or in person;
- implementing internal guidelines, procedures and criteria to prevent large 
electricity supply voltage variations, aiming at avoiding damage to household 
appliances and/or supply failure;
- presenting a program for goals to be accomplished related to the continuity 
of electricity supply provided in the concession contract.


BRAZIL: THERMAL POWER STATIONS PROJECTS
O Estado de S.Paulo, 24 Feb 2000, p. b-8:-
 On February 24th 2000, the Brazilian President of the Republic Fernando 
Henrique Cardoso will sign with over-20 private companies a package of 
responsibility protocols for the simultaneous construction of 49 thermal 
power stations in Brazil that aim at providing additional 13,000MW energy 
(the same energy currently generated by the hydro station of Itaipu, the 
largest one in Brazil).
These 49 stations will demand R$ 11bn investments and they are expected to 
begin operating from 2003 to supply heavy energy consumers and distribution 
companies, which have already guaranteed electricity purchase.
In addition, most of these stations will be gas-fired.
Among companies involved in the construction of these stations are the 
Brazilian state-owned oil company Petrobras, the companies Enron and General 
Electric (US), Marubeni (Japan) and British Petroleum (UK).


BRAZIL: TUCURUI WILL BE DUPLICATED
Gazeta Mercantil, 24 Feb 2000, p. A-4:-
 The Brazilian electricity company Eletronorte will close contracts with the 
consortium Cetuc, on February 24th 2000, to duplicate the hydroelectric plant 
of Tucurui.
The total value of the contracts is of R$ 750mn, and, by the end of 2006, the 
plant will have a generation capacity of 8,400MW.
Cetuc is formed by ABB Alstom, the Brazilian Grupo Inepar and also Tenenge 
Engenharia. The part of Inepar in the investment is of R$ 187mn, and, from 
this amount, R$ 140mn will be used for the production of generators and 
turbines by its division GE Hydro Inepar. Other division, Inepar-FEM, will 
supply hydro-mechanic equipment and mounting services. ABB Alstom will supply 
generators, hydraulic turbines, protection systems, supervision and control. 
Tenenge will be responsible for mounting services.


BRAZIL: INFORMATION ABOUT ENERGY SOURCES
Gazeta Mercantil, 24 Feb 2000, p. b-19:-
 The Energy Secretary of the Brazilian state of Sao Paulo published the 
Energy Balance 1999 with information about the energy sources in the state in 
1998 such as:
- energy products consumption increased by 1.6%;
- 49% of the total consumption were from oil derivatives (47% in 1990);
- 21% were from biomass (24% in 1990);
- 16% were from electricity (18% in 1990);
- 14% were from other sources like alcohol, firewood and coal;
- the state was responsible for 30.4% of the total Brazilian consumption;
- the state was responsible for 29.6% of the total Brazilian supply.


BRAZIL: CALL FOR TENDER OF GAS AREA IN SAO PAULO
Gazeta Mercantil, 24 Feb 2000, p. b-5:-
 The call for the tender for the concession of Gas Sul, the 3rd gas 
distribution area in the Brazilian state of Sao Paulo, will be available from 
February 24th 2000 at the headquarters or at the site of the Energy Public 
Services Commission (www.cspe.sp.gov.br).
These are some information about the tender:
- documents for pre-qualifying must be delivered until March 27th 2000 at 
14:30;
- minimum price is R$ 95mn;
- R$ 100mn will have to be invested in the first 10 years of concession by 
the new controller of the area;
- the tender is scheduled for April 26th 2000 with the opening of financial 
proposals;
- on April 4th 2000 the conclusion of analysis of documents and technical 
qualification is expected to be announced;
- some companies which are interested in the area are BR Distribuidora 
(Brazil), Eni (Italy), EDP (Portugal), CMS (USA), Enron (USA), Total (French) 
and Gas Natural (Spanish).


BRAZIL: INVESTMENTS OF ULTRAPAR IN 2000
O Estado de S.Paulo, 24 Feb 2000, p. b-20:-
 R$ 195mn are expected to be invested by the Brazilian holding Ultrapar 
Participacoes in 2000, including the following:
- R$ 110mn in its gas company Ultragaz, being 50% for the construction of 
liquefied petroleum gas bottling units in the states of Ceara and Rio de 
Janeiro and the cities of Belo Horizonte and Goiania and the remaining 50% in 
its bulk distribution system expansion;
- R$ 70mn for its petrochemical company Oxiteno, with purifying capacity 
expansion and quality improvement of dietene oxide. 


BRAZIL: PETROBRAS' PLANS IN PETROCHEMICALS
Folha de S.Paulo, 23 Feb 2000, p. 2-3:-
 The Brazilian state-owned oil company Petrobras will not bid for the 
Brazilian petrochemical complex Copene together with the Brazilian 
petrochemical company Copesul nor with another company until the complex 
crossed shareholdings issues are completely solved.


US: CHEVRON TO INVEST HEAVILY IN THAI VENTURE
Oil & Gas News, 24-30 Jan 2000, p.12:-
 Chevron Corp (a US oil and gas company) is allocating US$ 3.6 bn in 2000 for 
its global production and exploration operations. 
The company is eyeing Thailand as its core investment focus, alongside 
Argentina. Thailand and Argentina will take up a lion's share of the firm's 
US$ 5.2 bn exploratory and capital expenditure allotted for 2000.


ARGENTINA: PAN AMERICAN TO INVEST US$ 50MN
El Cronista Comercial, 24 Feb 2000, p. 15:-
 Pan American Energy, the Argentine-British company subsidiary of Bridas and 
BP-Amoco, announced it plans to invest up to US$ 50mn to exploit 30 oil 
fields in Northern Santa Cruz, in the region of Patagonia, Argentina. Over 
the past week, the firm also had announced it plans to invest US$ 185mn in 
the province of Chubut, in the same region, where it plans to drill 100 new 
wells in the San Jorge gulf and to construct a gas compressing plant.


ARGENTINA: HUNTER MAY TAKE OVER ATALAYA
El Cronista Comercial, 24 Feb 2000, p. 15:-
 Canadian Hunter Exploration announced it may take over 78% of Atalaya Energy 
for US$ 34mn in Argentina, expressing it is also interested in the 
acquisition of other gas assets of Capex and Clan Energy International Fund 
in this country. Capex, the Argentine oil and gas company, announced on 
February 23, 2000, it has formally agreed the sale of 9.31% of Atalaya Energy 
to the mentioned Canadian-based company for US$ 2.6mn. Atalaya owns 10% of 
the Chihuidos gas field and of the concession of Sierra Chata exploitation 
works, which is expected to produce a daily average of 145mn cubic feet of 
gas per day. The overall operation may involve US$ 47mn, becoming Canadian 
Hunter Exploration's first international investment.

ARGENTINA: NEW OIL BILL COMING UP
El Cronista Comercial, 24 Feb 2000, p. 6:-
 Further reductions over the current price of gasoline may only be 
implemented in the mid-term, admitted Argentina's Minister of Economy, Jose 
Luis Machinea during a recent meeting. The official also remarked the 
Argentine government is concentrating its efforts to fix new fair competition 
rules for the Argentine market, but such rules may only depend on the 
sanction of a new bill which introduces changes to the current regulations 
for this country's oil market. Machinea also stated the government cannot 
eliminate taxes applied to the final price of gasoline because it needs such 
funds to finance public spending, while he announced the government is 
studying a project to encourage the use of natural gas for cars in Argentina.


BRAZIL: TOURINHO IN COUNCIL OF ELETROBRAS 
Gazeta Mercantil, 24 Feb 2000, p. A-4:-
 The Brazilian minister of Mining and Energy Rodolpho Tourinho will assume 
the presidency of the administrative council of the electricity holding 
Eletrobras.
Tourinho's mainly mission is to make the privatisation of electricity 
companies faster.
Eletrobras controls the companies Furnas, Centrais Eletricas do Norte 
(Eletronorte) and Companhia Hidreletrica do Sao Francisco (Chesf).


BRAZIL: FGTS IN ELECTRICITY PRIVATISATION?
Folha de S.Paulo, 24 Feb 2000, p. 2-2:-
 Georges Lamaziere, the spokesman of the Brazilian president Fernando 
Henrique Cardoso, informed on February 23rd 2000 that the Brazilian Minister 
of Mining and Energy, Rodolpho Tourinho, is analysing a possible use of funds 
from FGTS (Government Severance Indemnity Fund for Employees) in the 
privatisation of the electricity sector. 


SOUTHERN/CENTRAL AMERICA: IBERDROLA'S PLANS
La Gaceta de los Negocios, 23 Feb 2000, p.16:-
 Spanish electricity operator Iberdrola has decided to focus its expansion 
plan on Southern and Central America, particularly in Brazil and Mexico.
In this sense, in Brazil it assigned Pta 170,000mn to acquire Cepme, 
electricity operator active in the region of Pernambuco; while in Mexico, it 
will allocate Pta 40,000mn to build a combined cycle power station in 
Monterey.
Additional Pta 80,000mn will be invested by Iberdrola in a four-year term, in 
order to improve capacity of its gas and electricity subsidiaries placed in 
Southern and Central America, as well as to acquire other firms of this 
region.
Currently, Iberdrola totals in this area 6.5mn clients (on 15mn total 
clients), which consume nearly 22,400 gigawatts per hour, representing 26.5% 
of whole production of the Spanish operator.


BRAZIL: ENERGY ECONOMY WITH DST
Gazeta Mercantil, 24 Feb 2000, p. A-4:-
 According to the Brazilian Ministry of Mining and Energy, the inter-linked 
electricity system South-Southeast-Centre-West saved 2,154MW with the 
daylight saving time (DST), adopted since October 3rd 1999.
Only in the South and Centre-West regions, the reduction was of 2,026 MWh. In 
the North-east region, the DST was responsible for a reduction in the demand 
by 2.3%. In the South region, it was by 5.7%.


BRAZIL: INVESTMENTS OF PETROBRAS DISTRIBUIDORA
Folha de S.Paulo, 24 Feb 2000, p. 2-4:-
 The Brazilian fuels distribution company Petrobras Distribuidora (BR) 
informed on February 23rd 2000 that the company plans to invest US$ 1bn with 
its owns funds by 2005, being R$ 300mn in 2000 mainly to continue with its 
petrol stations modernisation and to open new stations for vehicle gas. 


BRAZIL: MANGUINHOS WILL ENLARGE PLANT
Gazeta Mercantil, 24 Feb 2000, p. A-4:-
 The Brazilian Oil Refinery of Manguinhos will probably begin the works to 
increase its plant based in the North Zone of the city of Rio de Janeiro by 
the end of 2000.
The predicted amount to be invested is of US$ 65mn, and the refining capacity 
will be increased from 12,500 to 32,000bopd.
In this plant, will also be constructed 40 tanks to stock crude oil and oil 
derivatives. A maritime transport base will be constructed in the Guanabara 
Bay, which is near the plant.


BRAZIL/ARGENTINA: PETROBRAS/REPSOL'S NEGOTIATION
Jornal do Commercio, 24 Feb 2000, p. a-16:-
 The president of the Brazilian state-owned oil company Petrobras, Henri 
Philippe Reichstul, informed on February 23rd 2000 that he is analysing the 
following proposal made by the Spanish company Repsol: Repsol would exchange 
part of the derivatives distribution network of its Argentine company YPF 
with the refinery Refap of Petrobras in the city of Canoas (state of Rio 
Grande do Sul).


ARGENTINA: BB+ RISK RATING FOR METROGAS
Buenos Aires Economico, 24 Feb 2000, p. 5:-
 Argentine gas company MetroGas has received a BB+ rating for its foreign 
currency debt from risk rating agency Fitch IBCA, relating to medium-term 
bonds of US$ 282.5mn and a medium-term notes programme of US$ 600mn. MetroGas 
is 70% owned by Gas Argentino, in turn 54.7% controlled by British Gas.


ARGENTINA: NATURAL GAS POWERED CARS
Gazeta Mercantil Latinoamericana, 20 Feb 2000, p.13:-
 With gasoline prices skyrocketing all over the world, alternative fuels have 
been put back on the agenda, and many Argentines are looking to compressed 
natural gas as a solution to reduce fuel consumption and costs. The number of 
converted vehicles in the country has grown 9 times since 1994, reaching over 
489,000 vehicles in 1999. Argentina is the country with the most natural gas 
powered cars in the world where it is estimated that over 1.3mn gas powered 
cars exist. Over 3000 vehicles per month are converted to natural gas and 
over 800 service stations in 144 cities offer it in Argentina. Of the 489,000 
units, 71.2% are used by private citizens and 10% by taxis. Natural gas 
engines are environmentally friendly and wear out engines less than regular 
gasoline. The savings in fuel consumption can be as high as 70% compared to 
gasoline, making the engine conversion investment amortizable in only 9 
months or 25,000 km. Car maker, Fiat is the only company to produce natural 
gas models in Argentina direct from th
e factory, without the need to convert the models later.


BRAZIL: CHANGES IN ESTIMATE FOR OIL ACCOUNT
Folha de S.Paulo, 24 Feb 2000, p. 2-1/2-4:-
 The Brazilian oil account was expected to help the Brazilian fiscal 
adjustment in 2000 (R$ 36.77bn) with R$ 3.5bn.
But with the higher international oil prices, the Brazilian Minister of 
Mining and Energy, Rodolpho Tourinho, informed on February 23rd 2000 that the 
estimate for the oil account result in 2000 is being calculated again.
According to the Budget Commission of the Brazilian Congress, the federal 
government will have only R$ 1.5bn from the oil account in 2000, based on the 
following scenario: oil price between US$ 23 and US$ 25/barrel, dollar rate 
of R$ 1.85 and no price readjustment for consumers. 


ARGENTINA: DIESEL FUEL PRICE RISE DENOUNCED
Buenos Aires Economico, 24 Feb 2000, p. 2:-
 The four associations representing road passenger transport companies in 
Argentina have announced that they will present formal complaints against oil 
companies for the recent rises in diesel prices, totalling 61% since July 
1999 in comparison with a 37% rise in world oil prices. The companies plan to 
present complaints both to the courts and to the National Competition Defence 
Commission over the increase, which has resulted in an additional cost of US$ 
150mn to passenger transport companies.
The sector has also announced that bus services between the hours of 23.00 
and 4.00 will soon be cut off, due to the crisis affecting the sector, while 
daytime services will be reduced up to 10%. These measures will result in the 
loss of up to 5,000 jobs, according to sector chamber CETAP. 
The urban passenger transport sector is now also faced with losses of some 
US$ 400mn annually due to competition from illegal mini-cab companies, as 
well as unpaid debts of some US$ 800mn arising from the liquidation of former 
state reinsurance company INDER. A 1997 decree which suspended lawsuits for 
accidents as a result of the emergency faced by the sector will expire on 31 
March, and companies fear a wave of lawsuits thereafter.