Frazier

If EGLI is sued, this will be our case. I have been involved because we knew
this extortion was coming one day. I would recommend that we not settle. This
is a message case for me. We need to send a message to all plaintiff's attys
that Enron doesn't settle simply to avoid the cost of litigation. With the
Litigation Unit defending this case, our cost will be below $30,000. Let me
know what you think.
---------------------- Forwarded by Richard B Sanders/HOU/ECT on 07/07/99
04:17 PM ---------------------------

Eileen Kisluk@ENRON
07/07/99 03:52 PM
To: Philip Crowley/ET&S/Enron@Enron, Richard B Sanders/HOU/ECT@ECT, Bonnie
White/Corp/Enron@Enron, Louis Soldano/ET&S/Enron@Enron, James P
Studdert/HOU/ECT@ECT
cc:
Subject: Frazier

On July 2, 1999 I sent counsel for the Plaintiffs a letter wherein I again
urged them to dismiss Enron Products Pipeline from the captioned litigation.
I received a telephone call this afternoon from David Carlile. Mr. Carlile
advised that he will dismiss EPP from this litigation. Mr. Carlile then
advised that Enron Gas Liquids, Inc. sold a large quantity of propane to the
facility and in the event that a settlement was not reached he would bring
EGLI into the litigation. As the conversation went along, Mr. Carlile stated
that propane is not his target defendant and that he would settle with us for
$50.00 per plaintiff. He then said that his bottom line is $30,000 which is
the lowest sum he has taken from any of the settling parties. I advised David
that I would relay the conversation to my clients and would get back with him
in due course.

In the interim, David is going to send me a letter along with a Non-Suit as
to EPP.

I would appreciate your thoughts on whether we should accept the settlement
offer.

- - EWK