CPS Interconnect Agreement

---------------------- Forwarded by Gerald Nemec/HOU/ECT on 10/18/99 10:45 AM
---------------------------

Barbara N Gray
10/12/99 11:03 AM
To: Gerald Nemec/HOU/ECT@ECT
cc:
Subject: CPS Interconnect Agreement

Gerald this reflects the concern I spoke to you about yesterday;please draft
a cover letter for my review and our discussion. Thank you.
---------------------- Forwarded by Barbara N Gray/HOU/ECT on 10/12/99 10:58
AM ---------------------------

Steve -HPL- Schneider
10/12/99 06:43 AM
To: Barbara N Gray/HOU/ECT@ECT
cc: Gerald Nemec/HOU/ECT@ECT, Garry D Wilson/HOU/ECT@ECT, Tom
Liewer/HOU/ECT@ECT
Subject: CPS Interconnect Agreement

As per our conversation yesterday, I have a heightened concern about the CPS
Interconnect Agreement as drafted, as it implies that HPL can perform at
certain levels based on the facilities being installed. This is incorrect in
probably all cases, and I need your assistance in drafting a cover letter to
help clarify HPL's position to CPS as to our ability to perform, and more so,
our contractual obligation to perform relative to this proposed contract
draft. All this contract does is agree that HPL will allow the facilities
they are requesting to be installed, subject to Tejas Gas' approval (JV
responsibility), at their cost. There is no commitment to flow any volume of
gas on any basis under this agreement. Any such obligation would have to be
negotiated and agreed to in writing separately. Please provide draft
response. If you have any questions, please call.