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

2. Income Statement (000s)

3. Income Statement (000s) - Executive

4. 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

5. Income Statement (000s) - Compression

6. 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

7. Income Statement (000s) - Offshore

8. 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

9. Income Statement (000s) - Storage

10. 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

11. Income Statement (000s) - Producer Services

12. Income Statement (000s) - Wellhead

13. 2001 Goals for Producer Ecommerce and Wellhead
Financial
2001 Forecasted Total Margin : $ 6 million ; EBIT : $ 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

14. Income Statement (000s)

15. Income Statement (000s)