Re: Use of Enron Interntional For Brazilian Transactions ,
 Do you have an answer to this question?  Should ENA continue to transact with 
EI?  Sara




Lynn Aven@ENRON_DEVELOPMENT
10/25/99 03:20 PM
To: Carolyn Barrett/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc: Sara Shackleton@ENRON_DEVELOPMENT, Bruce 
Harris/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Kent Castleman 
Subject: Use of Enron Interntional For Brazilian Transactions

Carolyn:

During 1999, there have been several purchases of NDF's related to the 
Elektro risk.  ENA, formerly ECT,  purchased the NDF's and then did a back to 
back NDF with Enron International for the identical risk.  The gain or loss 
associated with the NDF thus was reflected on EI's books.  

Now that EI is no longer an operating entity, I understand that the same 
transactions are still being handled on a back to back basis with EI from 
ENA..  Do you foresee that this will be a long range approach to these sorts 
of transactions or will each of the regions have to execute an ISDA agreement 
with ENA in order to get the gain or loss on the appropriate regions's books? 

From a tax perspective, the income is all US source income and therefore 
leaving the income on EI's books while apportioning the gainor loss to the 
various regions for financial reporting purposes if fine.

Thanks for sharing any insight you may have as to how accounting will handle 
these transactions going forward.
lynn.aven@enron.com