In connection with the execution of the new ISDA Master Agreements between 
ECT and ECT Canada and PG&E Energy Trading Gas Corporation and PG& E Energy 
Trading, Canada Corporation, we, and they, will be issuing  new "umbrella" 
guarantees that will cover all transactions between the above entities and 
also cover EPMI and PG&E Energy Trading - Power, L.P. and CEG Energy Options 
Inc. (a PG&E affiliate)  These new guarantees will cover all physical, 
financial and power transactions between the above parties.  I have sent them 
the original of my Enron Corp. Guaranty for $105,000,000 and have received in 
the original of the PG&E Corporation Guaranty for $100,000,000.  Rod is 
resolving whether we agreed to increase the Enron Corp. guaranty to $110mm.

In connection with the issuance of the new bilateral guarantees I need to 
return to them the originals of the following PG&E guarantees:  (1) PG&E 
Corporation Guarantee dated as of March 28, 1998 covering business between 
Enron Power Marketing, Inc. and PG&E Energy Trading - Power, L.P., (2) PG&E 
Corporation Guarantee dated as of June 5, 1998 in favor of Enron Power 
Marketing, Inc. covering physical transactions, and (3) PG&E Energy Trading 
Corporation Guaranty dated March 11, 1997 covering physical business with ECT 
Canada.

I will also be returning to you the returned originals of the Enron Corp. 
Prior Guarantees.