Anita:

I seem to remember that our traders in Singapore did a deal with a PRC 
company a while back and it was our conclusion at the time that it was a very 
dangerous (perhaps unenforceable) thing to do.  My vague memory is that only 
financial institutions could enter into derivatives in the PRC and even then 
there was invariably a sovereign immunity risk.  Do you remember this and can 
you refresh my recollection?

Mark
---------------------- Forwarded by Mark - ECT Legal Taylor/HOU/ECT on 
11/19/98 06:55 PM ---------------------------
From: Heather J Mitchell AT ENRON_DEVELOPMENT@CCMAIL on 11/09/98 04:50 PM
To: Mark - ECT Legal Taylor@ECT
cc: Doug Leach@ECT, "Margarita G Jannasch/ENRON_DEVELOPMENT" AT 
ENRON_DEVELOPMENT@CCMAIL 
Subject: LNG hedging for China




Mark,

Cynthia Scneider recommended I check with you on the ability of Chinese 
government-owned entities to enter into derivative contracts with Enron.  Has 
ECT done any research on China?  Please see the e-mail below for details on 
counterparty, size, term, etc.

Thanks,
Heather Mitchell
---------------------- Forwarded by Heather J Mitchell/ENRON_DEVELOPMENT on
11/09/98 04:42 PM ---------------------------


Heather J Mitchell
11/05/98 03:36 PM

To:   Cynthia L Schneider@ENRON_DEVELOPMENT
cc:   Doug Leach@ENRON_DEVELOPMENT
Subject:  LNG hedging for China

Cynthia,

The EI LNG Group is looking at providing LNG price risk management for China. 
Could you please confirm whether China National Oil Company (Corp.?) and 
China State Power Corp. are creditworthy counterparties?  Before Doug and I 
talk to the traders I want to see whether we would even be willing to sell 
LNG risk management to them.

The structure the group is most likely interested in is 500,000 MT to 
1,000,000 MT per year for five to 20 years (depending on what our traders are 
comfortable with).  I imagine the Chinese would be interested in a cap or 
collar, and not a fixed price.

What other info do you need for a quick estimate?

Thanks,
Heather