Elio,

Looking at the 11,800 MT case of Puerto Rico versus the Mediterranean:

The numbers below indicate a $20/MT difference in freight versus the $7.50/MT difference that I mentioned earlier.

If Med. prices are $215/MT and Mont Belvieu is $0.39/gal., then a Puerto Rico delivery would look like either of the following two cases:

1.	($215 + $20)/521 = $0.451 per gallon or MB plus 6.1 cents ,i.e., 0.9 cents/gallon savings vs PDVSA

or 

2.	($215 + $7.5)/521 = $0.427 per gallon or MB plus 3.7 cents ,i.e., 3.3 cents/gallon savings vs PDVSA

There would be additional savings of 0.25 cents to 0.50 cents per gallon for both of the cases above if a West Africa supplier would do a fixed price deal and thus we would avoid going through Lee's Bid-Ask spread.  

Tomorrow we should refresh the Med. price and the MB price and get Bo to get a more exact freight differential. Then we can recalculate the numbers and see if this is worth pursuing.

Paul
 -----Original Message-----
From: 	Clapp, Suzanne B.  
Sent:	Wednesday, October 03, 2001 2:18 PM
To:	Y'Barbo, Paul
Cc:	Mauco, William
Subject:	Freight Rates - West Africa - Med / Caribs

Paul, in comparing freight rates for Med vs Caribs and Caribs vs Caribs (cargo size), I do see Bo's point.  

For smaller lot sizes (8,600 - 11,800 MT), the rates are abt.:
	$50 - $60 W. Africa to Med and 
 	$60 - $80 W. Africa to Caribs

however,

the larger cargoes (20,000 - 30,000 MT) curently moving are as follows:
	$30 - $40 W. Africa to Med and
	$40 - $60 W. Africa to Caribs

So, in comparison to the Med, the additional freight incurred on moving a 8,600 MT cargo to 
Puerto Rico vs a 20,000 MT cargo to the Med is $40.00, or for an 11,800 MT cargo $20.00.

Granted, these are not negotiated numbers, so they could be slightly better.

Let me know your thoughts.

Just keep in mind that PDVSA is there to supply an October cargo at +7.  I would hesitate to purchase from an alternative source lest they back off on other negotiations.

Best regards,
Suzanne