BUSINESS HIGHLIGHTS

Enron arranges first gas pipeline import into Italy
Enron has continued its pioneering activities in the Continental gas market by arranging the first gas import into Italy.  The Italian team worked with the Continental Gas desk to arrange this strategically important agreement with Blugas SpA., the wholesale gas company formed by the municipalities of Cremona, Lodi, Mantova and Pavia in north-eastern Italy.  Enron has sourced 100,000 cubic metres per day of natural gas from northern Europe to transport to Italy, transiting it through Germany and Switzerland, despite fierce resistance from Ruhrgas and TransitGas respectively.  

Aside from isolated LNG imports by incumbent monopolies this is the first time that any company has managed to import natural gas by pipeline into Italy since the Italian gas sector was officially liberalised in August 2000. The gas, which started flowing at 06.00 on Thursday 17th May 2001, will be used to meet the needs of two thirds of Blugas' residential customers within the four municipalities. The current contract lasts for five months.

Congratulations to Fabio Greco, Carsten Haack, Didier Magne, Michael Schuh, Marco Lantieri and Daniela Uguccioni.

Enron in the Middle East 
Enron has relinquished its stake in Dolphin Energy, the joint venture company formed to develop gas reserves in Qatar.
[Maclean, Iona]   
Enron has agreed to transfer its 24.5 per cent stake in the project to the United Arab Emirates Offset Group (UOG), the majority shareholder. The agreement allows Enron to deploy capital elsewhere and gives UOG the opportunity to seek new partners before the project moves into its next phase.

Development of the Emden/Oude gas hub moves ahead fast
An important milestone in the evolution of the new gas trading hub on the Dutch-German border was reached last week. Last Friday some of the major European gas players held a meeting to officially establish the Emden/Oude gas hub. Although Enron had already initiated the development of the Emden/Oude hub by making a market through EnronOnline as early as December 2000, the goal of this meeting was  to set up a working group similiar to the Zeebrugge focus group who can  work on setting a legal framework for the Emden/Oude hub. 

More than 40 companies participated in the meeting, representing producers, end users, Dutch and German transportation companies, marketing, and trading companies. More than 12 companies, including Ruhrgas and Gaz de France, were interested in joining the working group, but in the end the decision was taken to restrict the number of companies making up the working group to eight so as to ensure effecient and effective decision-making. The following companies were elected to become members of the working group: Centrica, Gasunie, Wingas, BEB, Statoil, Distrigaz, Duke Energy and Enron. 

Enron was elected as the only new market entrant in this group, reflecting the high level of respect industry peers have for Enron as a major player in the Continental gas market -- even from incumbents!

The working group will meet again on May 31st to begin developing a full-service hub agreement and, after the success of this first meeting, Enron is optimistic that the Emden/Oude Hub could be up and running by October 2001.


Weekly EnronOnline Figures
Below are the latest figures for EnronOnline as of May 23, 2001.

*	Total Life to Date Transactions >  1 million
*	Life to Date Notional Value of Transactions > $590 billion


ENRON IN THE PRESS

Paul Hennemeyer on European energy market liberalisation - "France.....is not the only bad boy in the class.  If I was their teacher, I would make all of them [the EU countries] stay behind after school for extra lessons" (Financial Times)

"Companies like Calpine Corp. (CPN) and Dynegy (DYN) that took advantage of the state's buying binge are looking pretty fat and happy. In fact, they have affectionately started calling the governor Gravy Days. Enron Corp. (ENE), which has been selling aggressively for two months, according to traders, is looking like a genius as usual. Generators that held out, like Reliant Energy (REI) and Duke Energy (DUK), may be sorry that they did".  Dow Jones Energy Service on long-term power contracts in California (18th May 2001)


EBUY PHASE II

The P2P Team are happy to announce the imminent  rollout of eBuy Phase II, Enron Europe's online procurement tool.  Following the successful deployment of Phase I last October, the P2P Team have incorporated additional functionality to enhance the tool and to streamline Enron's procurement processes.  The range of goods and services which you will be able to buy using eBuy Phase II has increased significantly.   

eBuy Phase II will also contain the first cut of Enron Europe's preferred supplier list for all non specialist goods and services. The preferred supplier list will act as a useful directory for all Enron staff, listing our preferred suppliers in a wide variety of areas. If  you have a preferred supplier for any goods or services, which you would like to nominate for the list, please contact Erika Moore in the P2P Team on 36737.

Mandatory training for assistants will begin at the end of May, with training for authorisers and general users in mid-June, together with Auditorium presentations for pizza lovers!


ENRON HOUSE NEW STARTERS

A warm welcome to Nick Elms (Govt & Reg Affairs), Nina Ripley (Doc. & Deal Capture), Jordis Blaschke (Online Content & Operations), Nickolaos De Santis (Fin Ops FP&A Income), Catherie Deguillaume (Weather Trading), Chris Holt (EIM - Mid/Back Office), Janice Hurst (HR - Tate), Simen Lunder (Power Analytics for Trading UK), Yusuf Noor (EES IT), Chiara Glen (Cash Management), Ben Knowles (IT Operations), Emma Cansdale, Fiona O'Brien (HR), Mike Cuin (IT Front Office), Arjunn Kar, Drew Ries (Metals), Melanie Maclean (Settlements & Contract Mgt), Sarah Kelt (EGM Trade Accounting).


NORDIC REGION NEW STARTERS

A warm welcome to Margaret Matre (Analyst), Randi Breivik (Data Management), Hakon Rohne, Knut Stensrod, Kim Jensen, Margit Helene Moen (Analysts), Kate Furuly (Accounting).


QUIZ OF THE WEEK

College is to noun as acute is to:

pronoun, adjective, verb, conjunction, adverb


AND LAST WEEK'S WINNER. . .

Congratulations to Nadir Afzal (Financial Operations) who was last week's Quiz of the Week winner.  The answer to the quiz was BOLT.  Other guesses included tack and escape.  A reminder last week's question is below:


Which word means both secure and run away?


NEWS FROM NORTH AMERICA . . .ENTOUCH  BUSINESS HIGHLIGHTS

Enron Industrial Markets
Enron Industrial Markets announced the signing of definitive agreements with Huntco, Inc. under which over a 15-year period Enron will provide inventory price risk management services and will eventually provide more than 600,000 tons per year of hot-rolled, cold-rolled and galvanized steel products to Huntco Steel.  The agreements provide Enron access to Huntco's network of steel distribution centers nationwide.  The agreements also provide for Enron's acquisition of Huntco's cold rolling and certain coil pickling operations in Blytheville, Arkansas.

These transactions with Huntco have the potential to fundamentally change the way steel is bought and sold in the United States.  It gives Enron immediate access to physical steel and positions Enron geographically to serve the steel industry in a variety of ways.  In addition to providing physical products on both a spot and term basis, EIM's goals for the steel industry include developing commodity risk management products, providing structured finance products and establishing the market-making capabilities that Enron has brought to the natural gas, power and other commodity markets.

Enron North America-Upstream Products
Upstream Products has partnered with Duke Energy Field Services (DEFS) to close a 20-year NGL exchange and transportation deal with Formosa Hydrocarbons and Williams Energy Field Services to handle raw make product from the Williams Markham plant. Formosa Hydrocarbons is building a 40,000 BPD fractionator to handle this and other Gulf Coast NGL production.  The accompanying pipeline will be known as the Seabreeze pipeline system and will be constructed by DEFS. Texas Brine LLC will provide NGL storage services for Formosa Hydrocarbons on this system. Primary production for this system is coming from the Boomvang Nansen field in the deepwater GOM and will be the first deepwater GOM production to come onshore in Texas. 
Upstream Products has also worked to arrange a 20-year transportation lease agreement on the Dean Pipeline (owned by TEPPCO) for refinery grade propylene service to be utilized by Formosa Plastics. Coupled with this transaction, Enron Clean Fuels has entered into a propylene storage agreement with Formosa Plastics to utilize ECF's Mt. Belvieu storage facilities.  In addition, Enron Global Markets has been able to amend its current transportation agreement with TEPPCO to prematurely terminate a take-or-pay obligation and realize additional transportation revenues from interim NGL production coming from the Williams Markham to be delivered to Mt. Belvieu.  
Upon close, Upstream Products was monetized out of its initial position by DEFS and retained a risk-free net profits position on the Seabreeze Pipeline going forward for an additional 20,000-40,000 BPD of excess capacity on the system.
ENA West Power
Southwest Power, an ENA affiliate, signed a 222MW 15-year tolling agreement with Allegheny Energy Supply for all of the output of Southwest's Las Vegas expansion project, scheduled for completion in September, 2002.  With the tolling agreement done and construction underway, the project will now be marketed to qualified generators.

ENRON EMPLOYEES VISITING NEW YORK CITY - PLEASE READ ON..........
After much success last year with our AskWhy advertising campaign and Public Relations efforts, Enron is continuing to explore new ways to exponentially increase its brand awareness not only through television, but by exploring new mediums. 

To this end, we are supporting the Frank Gehry Architect Exhibition at the Guggenheim Museum in New York City, which will be open to the public from May 18 through August 31.  Frank Gehry is a world-renowned architect who designed the unique building at the end of our "Ode to Why" commercial. His art dominates skylines around the world and, known for challenging the conventional, he has redefined his industry just as Enron has in business. Through Enron's association with this world-class exhibit, we will subtly push our brand attributes forward, as we strive to be the "Leading Company in the World."

All employees are invited to visit this exhibition free of charge with an Enron ID Badge or business card beginning May 18. For more details, please visit  http://home.enron.com