Upstream Products 2001 Plan Enron North America Upstream Products 2001 Plan February, 2001

Income Statement (000s)

Income Statement (000s) - Executive

2001 Goals & Objectives Financial Cost Strategy Meet EBIT target for all product groups Maintain Overall ROCE -> 50% Cost Each commercial business head has their own RC number Executive RC captures general group expenses such as: Magazine subscriptions, company memberships Office and floor supplies 15% reduction in costs Strategy Upstream origination has been streamlined from 56 to 32 employees and renamed “Upstream Products” to reflect the new focused vision Concentrate organization on refining their products for customer coverage Utilize originators across Central, East and West as distribution channels Implement business plans and group website Develop strategic “point of view” throughout North America Interface with long-term fundamentals Educate originators about financial risk management Acclimate groups to all financial and physical products traded in gas and power

Income Statement (000s) - Compression

2001 Goals for Compression Services Financial 2001 Forecasted Total Margin: $ 16 million 2001 Forecasted EBIT: $ 14.3 million Current Headcount: 7 Strategy and Goals Develop a customer coverage list to target non-affiliate counterparties Create a “pitch” book of financial and physical products diversify away from initial foundation of business -- short power, long gas Align all origination and trading entities involved Wholesale power and gas trading, EES Origination and risk management Close 10+ deals (external) Build sustainable 3rd party HP services business Obtain 1st move advantage! Become Enron HP services by end of 2001

Income Statement (000s) - Offshore

2001 Goals for Production Offshore Financial 2001 Forecasted Total Margin : $ 20 million 2001 Forecasted EBIT : $18.3 million Current Headcount : 7 Strategy and Goals By 2007, Gulf of Mexico (GOM) production growth for crude and natural gas is expected to be dominated by deepwater projects Win one or more bids to develop a leased, production platform in the deepwater GOM Target projects in reservoir corridors with high tieback potential Use Residual Value Insurance to monetize the back-end value of the production platform Entertain possible alliances with existing competitors

Income Statement (000s) - Storage

2001 Goals for Storage Financial 2001 Forecasted Total Margin : $ 8 million 2001 Forecasted EBIT : $ 6.95 million Current Headcount : 4 Strategy and Goals Develop a customer coverage list Create a “pitch” book of financial products Align with Principal Investing to focus on “Investment Targets” for example, eCorp Reengineer and/or monetize existing Brownfield sites for example, National Fuels Complete 4 transactions

Income Statement (000s) - Producer Services

Income Statement (000s) - Wellhead

2001 Goals for Producer Ecommerce and Wellhead Financial 2001 Forecasted Total Margin : $ 6 million ; EBIT : $ 4.715 million $ 4 million for Producer Ecommerce, $ 2 million for Wellhead Desk Current Headcount : 4 Strategy and Goals Create seamless “value chain” for producers take care of all accounting, measurement, scheduling and marketing needs Target 4 Producers as prototype “value chain” clients 2 with production volumes < 50,000 mmbtu/day 2 with production volumes > 250,000 mmbtu/day Use Producer Origination and ECR as distribution channels Align trading desks with Wellhead desk interests want to transact on Enron Online to hedge surplus or shortages to portfolio

Income Statement (000s)

Income Statement (000s)