RICK:
 
    Thanks for your note and staying in touch during a time when a
huminatarian crises could easily spiral into something  where the worste
news is yet to come.   Here is what Ive found out...
 
    NYMEX has contingencies (which they are yet to exercise) for back-up
clearing, as well as a back-up site for open outcry trading.  In the past,
the first contingency has been exercised several times and is proven, though
the later has never been tested in practice.  Meanwhile, clearinghouse
payments have been delayed as a result of the NYMEX closing and the exchange
is likely to remain closed through the balance of the week (thus eliminating
the need for daily payments).  During this time the exchange is closed, an
effort is to be made to trigger one or both of the contingencies above
(based on yet to be clarified damage assessments).  The fact that some
degree of transaction data integrity exists suggests that long-term payment
performance from NYMEX is not likely to be a problem.  However, if clearing
payment delays extend past the end of the month when swaps settle, then we
may see delayed payments from weaker credits in related swap and physical
markets.  In this regard, the markets have breathing room since the
terrorist attacks didnt occur late in the month.  Finally, there have been
general comments from Treasury and Fed Bank officials to guarantee stock
exchange payments, and the assumption is that the same guarantees would
apply to the NY commodity exchanges (but this asumption has not been
validated or addressed directly in public comments).  Hope this helps.
Brad.

-----Original Message-----
From: Buy, Rick [mailto:Rick.Buy@ENRON.com]
Sent: woensdag 12 september 2001 17:52
To: Brad.Horn@nuon.com
Subject: RE: Systemic Market Risk to Follow NYMEX Failure


Was out of town but back now. I asked my group to look at your note and
apprise me. Will let you know when they do. Tx Rick

-----Original Message-----
From: Brad.Horn@nuon.com [mailto:Brad.Horn@nuon.com]
Sent: Tuesday, September 11, 2001 11:30 AM
To: rbuy@enron.com
Subject: FW: Systemic Market Risk to Follow NYMEX Failure




Rick: 
        In light of recent events at the world trade center, Im concerned
about the poitential for a systemic failure following the destruction of
NYMEX. A quick note from you to confirm or deny would be appreciated.

        For example, if NYMEX payments are delayed significantly, Im worried
that a larger payment failure in the energy derivatives market might follow.
In this scenario, Enron?s large NYMEX position could put it in jeoprardy.
As a result, I would think you would know before others if a NYMEX clearing
falure is in the works.  Do you have any insight at this time into NYMEX
payment performance?????



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