Danny, I am forwarding you this summary of two conversations last week in Calgary.  Also I believe Eric had a similar talk with Dennis in Houston.   I want to emphasize that in sending this message out I was simply acting as meeting secretary regarding what was said last week.  It is clear to me that Stan wants to call these shots.  Bob. 

 -----Original Message-----
From: 	Hill, Robert  
Sent:	Friday, December 07, 2001 4:32 PM
To:	'paul_macgregor@transcanada.com'; 'byron.wright@elpaso.com'; 'donna_friesen@transcanada.com'; Place, Janet
Cc:	Cordes, Bill
Subject:	B to C Joint Venture

This is my effort to write up the concepts that were discussed last Tuesday night by Paul MacGregor, Hank Petranik, Bill Cordes and myself. While possibly incomplete, the thoughts also include items from a brief discussion with Byron Wright and Donna Friesen.  If El Paso and Trans Canada wish to pursue these ideas further,  they should take them up directly with Stan Horton as Stan indicated recently that he wants to make the decisions related to Enron's position in the JV.  I would also ask Janet Place and Donna Friesen to review these thoughts and to offer their comments.  Bob Hill.


B to C Joint Venture Term Sheet with Northern Plains Natural Gas (an Enron subsidiary)

TransCanada, El Paso and Northern Plains Natural Gas Co. will jointly sponsor a Monchy to Chicago gas pipeline intended to transport Alaskan natural gas volumes to midwestern markets  (the "JV").

Terms of Participation for Northern Plains:

During the period of project development, prior to construction of Project Facilities, NPNG will not be required to contribute capital to the JV project.  All JV capital requirements will be met during this period by El Paso and TransCanada.

NPNG employees will perform various project development services as requested by the JV.  The JV will reimburse NPNG for all out of pocket costs incurred by NPNG on behalf of the JV.

NPNG shall have an opportunity to become an equity owner of the JV's B to C pipeline in a percentage not less than that to be owned by El Paso.   NPNG's investment opportunity will extend until the time that mainline construction of the B to C pipeline commences.           ( Would the closing date of the JV's debt funding be a better date to terminate the investment option by NPNG ?)

The price for NPNG's ownership investment would recognize the actual capital previously invested by the other owners, the time value of such invested capital from the time of investment to the date of NPNG's investment.

Included in the NPNG arrangement would be a clause providing that if there was a change of control of NPNG to a party other than TransCanada or El Paso, then Trans Canada and El Paso would have a right to terminate NPNG's investment option, or, if applicable, to repurchase NPNG's ownership position.

To the extent that the JV elects to utilize the Conditional ANGTS Certificate issued by the FERC to Northern Border Pipeline Company in the JV's FERC application, then the JV will pay to Northern Border Pipeline Company  compensation for the value, if any, of such  conditional certificate.