9.	MINORITY INTERESTS

	Enron consolidates a limited partnership (the Limited Partnership), for which the consolidated third party's ownership interest is reflected in minority interests on Enron's balance sheet in the amount of $691 million at September 30, 2001.  The Limited Partnership assets include a $690 million note payable from Enron and certain merchant investments, both domestic and international.  Enron anticipates the receipt of $250 million from the sale of one of the Limited Partnership's investments, a local gas distribution company in Brazil, upon the closing of the sale which is pending certain regulatory and other approvals.  Enron may be required to use the net proceeds upon the closing of the sale, or a portion thereof, to repay a portion of the note payable.  

	The November 12, 2001 downgrade in Enron's senior unsecured debt rating to BBB- by Standard & Poor's has caused a ratings event related to the Limited Partnership.  This ratings event started a nine business day period during which Enron has the right, until November 26, 2001, to either post an unsecured letter of credit equal to Enron's note payable, repay the note payable with the Limited Partnership investing such proceeds in permitted investments, or to purchase the investors' interest in the Limited Partnership.  To the extent that Enron does not satisfy this requirement by November 26, 2001, the investors have the right to immediately begin to liquidate the Limited Partnership assets.  Additionally, as a result of the rating downgrade, the investors, subject to certain actions, are able to accelerate and assign the note payable.  Consistent with the restructuring plan discussed in Note 2, Enron is currently working with the lenders to develop a mutually acceptable amendment or waiver to the transaction documents in order to avoid an early Enron payment obligation.  

	Either as a result of the restructuring plan discussed in Note 2 or to raise cash to repay Enron's obligation discussed above, Enron may sell the Limited Partnership assets for amounts below their carrying values.  The net proceeds from the sale of such assets can be used to repay Enron's obligation.  Accordingly, Enron may be required to record asset writedowns, possibly as early as the fourth quarter of 2001.

	It is not possible to predict whether Enron will be able to favorably complete the actions described above.  In the event that Enron fails to pay any debt obligations when due, including when such obligations may be accelerated, or is unable to refinance or obtain a waiver of its obligation, a series of events would begin which could impact Enron's compliance with the terms of its Revolving Credit Agreements and certain other obligations, including bank debt facilities.  



Louise Kitchen
Chief Operating Officer
Enron Americas
Tel:  713 853 3488
Fax: 713 646 2308