Marty, looks like this nut may have some fruit. I look forward to continuing 
our discussions from 2000 on how we can be better together - I am committed 
to doing this the right way as I know you are.

Regards
Delainey
---------------------- Forwarded by David W Delainey/HOU/ECT on 01/05/2001 
09:36 PM ---------------------------


Rob Milnthorp
01/05/2001 05:16 PM
To: David W Delainey/HOU/ECT@ECT, John J Lavorato/Corp/Enron@Enron
cc: David Pope/CAL/ECT@ECT 
Subject: Enron Direct Canada-First Deal

fyi...1st deal of many. 

Regards
Rob
---------------------- Forwarded by Rob Milnthorp/CAL/ECT on 01/05/2001 04:14 
PM ---------------------------


David Pope
01/05/2001 04:01 PM
To: Harold G Buchanan/HOU/EES@EES
cc: Rob Milnthorp/CAL/ECT@ECT 
Subject: Enron Direct Canada-First Deal

Harold;

We have today closed our first retail transaction that is a five year 
exclusive gas supply arrangement with Boardwalk Equities, the largest 
apartment building owner in Alberta.  We will be serving 20,000 apartment 
suites with an annual consumption of 1.5 bcf.  The 5 year margin will be 
approximately $1.5 million.  As a result of our direct instructions, 
Boardwalk lobbied the government to provide them with $2.8 million dollars in 
rebates over the next 4 months to shield them from the higher gas prices.  
These rebates will be paid through Enron Direct as the retailer for Boardwalk.

The gas begins flow on March 1.  We are working on other large building 
owners and restaurant chains and expect to close 2 or 3 more deals for flow 
of March 1. Cadillac Fairview is committed to working with us on a gas 
contract within the next 2 weeks.   We now have a strong platform to grow 
quickly, from a standing start one month ago.

Although the government effectively delayed the opening of the retail power 
market for one year through a price cap, we have been able to grasp a first 
mover advantage on retailing natural gas in Alberta.  We expect to have a 
strong retail delivery organization built by mid year, with 35 staff managing 
a significant number of commercial customers.

The current pricing environment creates a large opportunity to sell 5 year 
fixed price product with significant margins.  Atco, the gas utility is 
getting bad press for not offering hedging instruments, and are cooperating 
with us to assist us in getting established as a retailer.  

This has been a very large effort in the last month, as we needed to get 
licensed, and get legal agreements in place where there were no precedents to 
look at.  We are excited at the prospects for a substantial business 
developing very quickly here in Alberta.  The Enron Canada analytical, risk 
management, regulatory and legal staff have provided great assistance to 
allow us to execute this transaction in a short period.

Regards.

Dave