EXHIBIT 4.43

               PARTNERSHIP INTEREST PLEDGE AGREEMENT
          (Pledge of Partnership Interests in Del Ranch)


                                by


                       MAGMA POWER COMPANY,
                    CALENERGY OPERATING COMPANY
                                and
                       CONEJO ENERGY COMPANY
                           (as Pledgor)




                            in favor of


               CHEMICAL TRUST COMPANY OF CALIFORNIA
                       (as Collateral Agent)



                     Dated as of June 20, 1996






    





                              TABLE OF CONTENTS


                                                               PAGE


 . Definitions....................................................3


 . Grant of Security Interest.....................................3


 . Representations and Warranties.................................4


 . Covenants and Agreements.......................................5


 . Pledgor's Obligations Upon Event of Default....................7


 . Remedies; Rights Upon Event of Default.........................7


 . Application of Proceeds........................................9


 . Security Interest Absolute.....................................9


 . Collateral Agent Appointed Attorney-in-Fact....................9


 . Collateral Agent May Perform...................................10


 . No Duty on Collateral Agent's Part,............................11


 . Reasonable Care................................................11


 . Role of Collateral Agent.......................................11


 . Waiver of Trial by Jury........................................11


 . Notices........................................................12


 . Absence of Fiduciary Relation..................................12

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 . Survival of Representations and Warranties.....................12


 . No Waiver; Cumulative Remedies.................................12


 . Severability...................................................13


 . Exculpatory Provisions; Reliance by Collateral Agent...........13


 . Amendment......................................................14


 . Successors and Assigns.........................................14


 . Number and Gender..............................................14


 . Subrogation, etc...............................................14


 . Captions.......................................................14


 . Applicable Law.................................................14


 . Continuing Security Interest; Termination......................14


 . Payments Set Aside.............................................15


 . Counterparts...................................................15


 . Non-Recourse...................................................15

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                     PARTNERSHIP INTEREST PLEDGE AGREEMENT
                (Pledge of Partnership Interests in Del Ranch)


           This PARTNERSHIP INTEREST PLEDGE AGREEMENT (this "Pledge
Agreement"), dated as of June 20, 1996, is entered into by MAGMA POWER
COMPANY, a Nevada corporation ("Magma"), CALENERGY OPERATING COMPANY, a
Delaware corporation ("CEOC"), and CONEJO ENERGY COMPANY, a California
corporation ("Conejo," and together with Magma and CEOC, the "Pledgor"), in
favor of CHEMICAL TRUST COMPANY OF CALIFORNIA, a California corporation, as
collateral agent (together with its successors and assigns, the "Collateral
Agent"), on behalf of and for the benefit of the Secured Parties and Funding
Corporation.

                       W I T N E S S E T H:

           WHEREAS, Magma, CEOC and Conejo own a 10%, 40% and 50% partnership
interest, respectively, in Del Ranch, L.P., a California limited partnership
("Del Ranch"); and

           WHEREAS, Salton Sea Funding Corporation, a Delaware corporation
(the "Funding Corporation"), is a corporation established for the sole purpose
of making loans to the Guarantors (as hereinafter defined) from the proceeds
of the issuance of notes and bonds (collectively, the "Securities") in its
individual capacity as principal and as agent acting on behalf of Salton Sea
Brine Processing L.P., a California limited partnership ("SSBP"), Salton Sea
Power Generation, L.P., a California limited partnership ("SSPG"), Fish Lake
Power Company, a Delaware corporation ("Fish Lake," and together with SSBP and
SSPG, the "Salton Sea Guarantors"), CEOC, Conejo, Del Ranch, Elmore, L.P., a
California limited partnership ("Elmore"), Leathers, L.P., a California
limited partnership ("Leathers"), Vulcan/BN Geothermal Power Company, a Nevada
general partnership ("Vulcan"), Niguel Energy Company, a California
corporation ("Niguel"), San Felipe Energy Company, a California corporation
("San Felipe"), and BN Geothermal, Inc., a Delaware corporation ("BNG"),
Vulcan Power Company, a Nevada corporation ("VPC," and together with Del
Ranch, Elmore, Leathers, Vulcan, Conejo, Niguel, San Felipe, BNG and CEOC, the
"Partnership Guarantors") and Salton Sea Royalty Company, a Delaware
corporation ("Royalty Guarantor", and together with the Salton Sea Guarantors
and the Partnership Guarantors, the "Guarantors"), pursuant to the Trust
Indenture, dated as of July 21, 1995, as the same may be amended, modified, or
supplemented, including pursuant to that certain Second Supplemental Trust
Indenture, dated as of even date herewith (as so amended, modified and
supplemented, the "Indenture"), between Funding Corporation and Collateral
Agent, as trustee ("Trustee"); and

           WHEREAS, the principal and interest payments on the Securities will
be serviced by repayment of loans made by Funding Corporation to the
Guarantors and guaranteed by the Guarantors, subject to the conditions set
forth in the Indenture; and

           WHEREAS, Funding Corporation has (a) on July 21, 1995 issued and
sold Securities in the principal amount of $475 Million (the "Initial
Issuance") and (b) simultaneously with the execution and delivery of this
Agreement issued and sold Securities in the principal amount of $135 Million
(the "New Issuance"); and




    



           WHEREAS, Funding Corporation has used a portion of the proceeds
from the Initial Issuance and intends to use the proceeds from the New
Issuance to make loans to the Partnership Guarantors in the aggregate
outstanding amount of $189,956,000, as of the date hereof, portions of which
will be used for the following purposes: (a) approximately $96 Million to
refinance all existing project- level indebtedness of the Partnership
Projects, (b) approximately $15 Million to fund certain capital improvements
to the Partnership Projects and the Salton Sea Projects, and (c) approximately
$23 Million to fund a portion of the purchase price for the acquisition by
certain of the Partnership Guarantors of the 50% interest in each of the
Partnership Projects previously owned by a third party; and

           WHEREAS, Pledgor anticipates benefiting directly and indirectly
from the making of the loan pursuant to the Partnership Credit Agreement and
is, therefore, willing to enter into this Pledge Agreement in accordance with
the terms hereof.



                             AGREEMENT

           NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in order to induce the
Funding Corporation to enter into the Partnership Credit Agreement, the
parties hereto hereby agree as follows:

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           1. Definitions. Unless otherwise defined herein, all capitalized
terms shall have the meanings set forth in Exhibit A to the Indenture, which
Exhibit A is hereby incorporated by reference. All references to sections,
schedules and exhibits in or to this Pledge Agreement are to sections,
schedules and exhibits in or to this Pledge Agreement, unless otherwise
specified. The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Pledge Agreement shall refer to this Pledge Agreement
as a whole and not to any particular provision of this Pledge Agreement. For
purposes of this Pledge Agreement, all other terms used herein and not
otherwise defined herein which are defined in Article 9 of the Uniform
Commercial Code (as the same may be in effect in the State of California or
any other applicable jurisdiction, the "Code"), shall have their respective
meanings as therein defined.

           2.    Grant of Security Interest.

                .1. Collateral. As security for the prompt and complete
payment and performance when due (whether at stated maturity, by acceleration
or otherwise) of any and all of the Obligations (as defined below) now
existing or hereafter arising, and howsoever evidenced, Pledgor hereby
collaterally assigns, conveys, mortgages, pledges, hypothecates and transfers
to Collateral Agent, and grants and creates a lien on and first priority
security interest (the "Security Interest") in favor of Collateral Agent, for
the equal and ratable benefit of the Secured Parties and the Funding
Corporation, in all right, title and interest of Pledgor in, to and under the
following, whether now existing or hereafter acquired (the "Collateral"):

                     .1 . its partnership interest in Del Ranch and all of its
      rights under the Amended and Restated Limited Partnership Agreement of
      Del Ranch, dated as of March 14, 1988, among Magma, CEOC and Conejo (the
      "Partnership Agreement") (including, without limitation, to the extent
      assignable or transferable, all of its right, title and interest as a
      partner to participate in the operation or management and control of Del
      Ranch and all of its rights to property, assets, partnership interests
      and distributions under the Partnership Agreement);

                .2. all present and future rights of Pledgor to receive any
      payment of money or other distribution or payment arising out of or in
      connection with its partnership interest in Del Ranch and its rights
      under the Partnership Agreement; and

                .3. to the extent not otherwise included, all proceeds,
      products and accessions of and to any and all of the foregoing,
      including, without limitation, "proceeds" as defined in Section 9-306(1)
      of the Code, including whatever is received upon any sale, exchange,
      collection or other disposition of any of the Collateral, and any
      property into which any of the Collateral is converted, whether cash or
      noncash proceeds, and any and all other amounts paid or payable under or
      in connection with any of the Collateral.

                .2. Obligations. This Pledge Agreement secures, in accordance
      with the provisions hereof, the following obligations, now existing or
      hereafter arising (collectively, the "Obligations"):

                .1. payment and performance of the Partnership Guarantors'
      obligations under the Partnership Credit Agreement and the Partnership
      Guarantee, and each and every obligation, indebtedness, covenant and
      agreement of Pledgor under any

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     of the Financing Documents to which it is a party, including, without
     limitation, this Pledge Agreement, the Intercreditor Agreement and any
     amendments or supplements thereto, extensions or renewals thereof or
     replacements therefor; and

                .2. performance of every obligation, covenant and agreement of
      Pledgor contained in any agreement now or hereafter executed by Pledgor
      which recites that the obligations thereunder are secured by this Pledge
      Agreement;

in each case whether direct or indirect, joint or several, absolute or
contingent, liquidated or unliquidated, now or hereafter existing, renewed or
restructured, reinstated, created or incurred, and, including, without
limitation, all indebtedness of Pledgor under any instrument now or hereafter
evidencing or securing any of the foregoing.

           3.     Representations and Warranties.  Pledgor hereby represents
and warrants as follows:

                .1. Organization and Existence. Del Ranch is a limited
partnership in which Magma owns a 10% limited partnership interest, Conejo
owns a 10% limited and a 40% general partnership interest, and CEOC owns a 40%
general partnership interest. Magma is a corporation duly organized, validly
existing and in good standing under the laws of the State of Nevada. CEOC is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. Conejo is a corporation duly organized, validly
existing and in good standing under the laws of the State of California. Each
of Magma, CEOC and Conejo is duly qualified to do business and is in good
standing in the State of California and each other jurisdiction in which the
character of the properties owned or leased by it or in which the transaction
of its business as presently conducted or proposed to be conducted makes such
qualification necessary or desirable. Pledgor has full corporate power and
authority to own its property and to carry on its business as now being
conducted and as proposed to be conducted.

                .2. Authority, Enforceability. Pledgor has full corporate
power and authority to enter into and perform the Partnership Agreement and
this Pledge Agreement and the entering into and performance of each such
agreement by Pledgor has been duly authorized by all proper and necessary
corporate action. Each such agreement, when executed and delivered by Pledgor
and any other party thereto, will constitute the legal, valid and binding
obligations of Pledgor, enforceable in accordance with its respective terms.

                .3. Title: No Other Liens. Pledgor is the legal and
beneficial owner of the Collateral in existence on the date hereof and will be
the sole owner of the Collateral hereafter acquired, free and clear of any and
all Liens or claims of others except for Permitted Liens, and Pledgor has full
corporate power and authority to grant the liens and security interests in and
to the Collateral hereunder. Except with respect to the Secured Parties and
the Funding Corporation and as required under this Pledge Agreement, no
security agreement, financing statement or other public notice with respect to
all or any part of the Collateral is on file or of record in any public
office, and no lien or security interest on or in the Collateral has been
registered in the registration book maintained by Del Ranch in which all
partnership interests of Del Ranch are recorded, except such as may have been
filed in favor of Collateral Agent for the benefit of the Secured Parties and
the Funding Corporation pursuant to this Pledge Agreement.

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           .4. Perfection; Registration of Lien. Financing statements or
other appropriate instruments have been filed or deposited for filing pursuant
to the Code in such public offices as may be necessary to perfect any Security
Interest granted or purported to be granted hereby to the extent any such
Security Interest may be perfected by the filing of a financing statement. All
other action by Pledgor and, to Pledgor's knowledge, by any other Person
necessary or desirable to perfect the Security Interest in each item of the
Collateral has been duly taken. Subject to the requirements contained in the
Code with respect to the filing of continuation statements, this Pledge
Agreement constitutes a valid and continuing Lien on and perfected Security
Interest (subject only to Permitted Liens) in the Collateral in favor of
Collateral Agent for the equal and ratable benefit of the Secured Parties and
the Funding Corporation, superior and prior to the rights of all Persons
(subject only to Permitted Liens), whether the Collateral subject to the
Security Interest is now owned by Pledgor or is hereafter acquired.

           .5 . No Default. Pledgor is not in default in the performance,
observance or fulfillment of any of the material obligations, covenants or
conditions applicable to Pledgor contained in the Partnership Agreement or any
Financing Document to which it is a party.

           .6 . Chief Executive Office and Principal Place of Business.
Pledgor's chief executive office and principal place of business and the place
where Pledgor's records concerning the Collateral are kept is:

                Blackstone Center
                302 South 36th Street, Suite 400-C
                Omaha, Nebraska  68131


           4. Covenants and Agreements. Pledgor hereby covenants and agrees
that Pledgor shall faithfully observe and fulfill, and shall cause to be
observed and fulfilled, each and all of the following covenants until all
Obligations to be paid or performed by the Partnership Guarantors under the
Financing Documents to which they are a party have been paid and performed in
full:

                .1. Further Assurances. Pledgor shall, from time to time at
the Partnership Guarantors' expense, and upon request by Collateral Agent on
behalf of the Secured Parties and the Funding Corporation, promptly execute
and deliver all further instruments and documents, and take all further action
that may be reasonably necessary or advisable, or that Collateral Agent
reasonably determines may be necessary, in order to perfect and protect the
Security Interest granted or purported to be granted hereby or to enable
Collateral Agent to exercise and enforce its rights and remedies hereunder
with respect to the Collateral.

                .2. Certificated Interest. If Pledgor shall become entitled
to receive or shall receive any certificate, instrument, option or rights,
whether as an addition to, in substitution of, or in exchange for the
Collateral or any part thereof, or otherwise, Pledgor shall accept any such
certificate, instrument, option or rights as Collateral Agent's agent, shall
hold them in trust for Collateral Agent, and shall deliver them forthwith to
Collateral Agent in the exact form received, with Pledgor's endorsement when
necessary, or accompanied by duly executed instruments of transfer or
assignment in blank or, if requested by Collateral Agent, an additional pledge
agreement or security agreement executed and delivered by Pledgor, all in form
and substance reasonably satisfactory to Collateral Agent, to be held by
Collateral Agent, subject to the terms hereof, as further Collateral for the
Obligations.

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                .3. Change in Location, Name, Etc. Pledgor may change the
location of its chief executive office, principal place of business or the
office where such records are kept to another location in the United States
after giving Collateral Agent thirty (30) days' advance written notice of such
change. Without the prior written consent of Collateral Agent, Pledgor shall
not adopt any trade name or fictitious business name.

                .4. Limitation on Liens on the Collateral. Pledgor shall not
create, incur or permit to exist, shall defend the Collateral now owned or
hereafter acquired by it against, and shall take such other action as is
necessary to remove, any Lien or claim on or to the Collateral, other than
Permitted Liens, and shall defend the right, title and interest of Collateral
Agent in and to any of the Collateral against the claims and demands of all
Persons whomsoever.

               .5. Bankruptcy Filing, etc. Pledgor shall not authorize or permit
Del Ranch (i) to commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to Del Ranch or Del
Ranch's debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of Del Ranch or any
substantial part of Del Ranch's property or (ii) to consent to any such relief
or to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against Del Ranch or (iii) to
make a general assignment for the benefit of Del Ranch's creditors. Neither
Pledgor nor any of its Affiliates shall commence or join with any other Person
(other than the Secured Parties and Funding Corporation) in commencing any
proceeding against Del Ranch under any bankruptcy, reorganization, liquidation
or insolvency law or statute now or hereafter in effect in any jurisdiction.

                .6. Obligations. Pledgor acknowledges and agrees that its
rights to receive any payments from Del Ranch, or arising out of or in
connection with Pledgor's interests in Del Ranch or its rights under the
Partnership Agreement, shall be payable by Del Ranch only from funds available
to Del Ranch upon distributions pursuant to the Depositary Agreement or any
other provision of the Indenture expressly providing for distribution, payment
or release of funds to Del Ranch, and only so long as such distribution,
payment or release is made in accordance with the Depositary Agreement and the
Indenture. Pledgor also agrees that any distributions made by Del Ranch to
Pledgor that do not comply with the Depositary Agreement and the Indenture
shall be restored to Del Ranch by Pledgor by deposit into an account
designated by Collateral Agent, promptly upon demand by Collateral Agent or
Del Ranch or upon Pledgor becoming aware of receipt of such non-complying
distribution.

                .7. Governmental Authority Requirement. Pledgor shall not
take or omit to take (or suffer such taking or omission of) any action (unless
ordered to do so by a competent Governmental Authority having jurisdiction) in
respect of Pledgor or Del Ranch and their respective businesses if, as a
consequence directly or indirectly of such action or omission, Del Ranch or
Pledgor becomes subject to regulation by any Governmental Authority as a
"public utility," an "electric utility," an "electric utility holding
company," a "public utility holding company" or a subsidiary or affiliate of
any of the foregoing under PUHCA, FPA or PURPA, or as a "holding company"
within the meaning of PUHCA.

                .8. Indemnification. Pledgor shall defend, indemnify and hold
harmless Collateral Agent and each of the other Secured Parties and the
Funding Corporation and their officers, directors and employees, from and
against any and all costs, expenses, disbursements, liabilities,

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obligations, losses, damages, injunctions, judgments, suits, actions, causes
of action, fines, penalties, claims and demands, of every kind or nature
(including, without limitation, reasonable attorney's fees and expenses) which
are occasioned by or result from any (i) failure by Pledgor to perform any of
the terms, agreements, or covenants to be performed by Pledgor under this
Pledge Agreement and (ii) proceeding or action to enforce brought by
Collateral Agent pursuant to this Pledge Agreement or which arise out of any
such agreement unless due solely to the gross negligence or willful misconduct
of Collateral Agent. This indemnity and any other obligations of Pledgor under
any of the Financing Documents shall be made only against, and shall be
limited to the extent of, the Collateral pledged hereunder.

           5 . Pledgor's Obligations Upon Event of Default. If an Event of
Default under the Partnership Credit Agreement or the Partnership Guarantee
shall occur and be continuing (a) all payments received by Pledgor under or in
connection with any of the Collateral shall be held by Pledgor in trust for
Collateral Agent, shall be segregated from other funds of Pledgor and shall,
forthwith upon receipt by Pledgor, be turned over to Collateral Agent or its
designee in the same form as received by Pledgor (duly endorsed by Pledgor to
Collateral Agent, if requested), and (b) any and all such payments so received
by Collateral Agent or its designee (whether from Pledgor or otherwise) may,
in the sole discretion of Collateral Agent or its designee, be held by
Collateral Agent or such designee as collateral security for, and/or then or
at any time thereafter be applied, subject only to the relevant provisions of
the Intercreditor Agreement and the Depositary Agreement or as otherwise may
be required by applicable law, in whole or in part by Collateral Agent or its
designee in the manner specified in Section 7.

           6 . Remedies; Rights Upon Event of Default. Upon the occurrence and
during the continuance of an Event of Default under the Partnership Credit
Agreement or Partnership Guarantee, Collateral Agent, for the equal and
ratable benefit of and on behalf of the Secured Parties and the Funding
Corporation, may, subject to the provisions of the Intercreditor Agreement and
the other Financing Documents, do one or more of the following:

      .1 declare, without presentment, demand, protest or notice of any kind,
all of which Pledgor hereby expressly waives, the entire amount of Obligations
to be immediately due and payable, whereupon all of such Obligations declared
due and payable shall be and become immediately due and payable; provided,
however, if, with respect to the Partnership Guarantors, an Event of Default
occurs pursuant to Section 5.1 of the Partnership Credit Agreement, then the
acceleration provided for in this Section 6.1 shall be deemed to have been
made upon the occurrence of such Event of Default without declaration or any
other action by Collateral Agent;

      .2 upon notice to Pledgor, which notice need not be in writing, make
such payments and do such acts as Collateral Agent may deem necessary to
protect, perfect or continue the perfection of the Secured Parties' and the
Funding Corporation's Security Interest in the Collateral, including, without
limitation, paying, purchasing, contesting or compromising any Lien which is,
or purports to be, prior to or superior to the Security Interest granted
hereunder, and commencing, appearing or otherwise participating in or
controlling any action or proceeding purporting to affect the Secured Parties'
and the Funding Corporation's Security Interest in or ownership of the
Collateral;

      .3 foreclose on the Collateral as herein provided or in any manner
permitted by law and exercise any and all of the rights and remedies conferred
upon the Secured Parties and the Funding Corporation by the Security Documents
either concurrently or in such order as Collateral Agent may determine without
affecting the rights or remedies to which the Secured Parties and the Funding

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Corporation may be entitled under any Security Documents. Pledgor hereby
waives, to the extent permitted by applicable law, notice and judicial hearing
in connection with Collateral Agent's taking possession or collection,
recovery, receipt, appropriation, repossession, retention, set-off, sale,
leasing, conveyance, assignment, transfer or other disposition of or
realization upon any or all of the Collateral, including, without limitation,
any and all prior notice and hearing for any prejudgment remedy or remedies
and any such right which Pledgor would otherwise have under the constitution
or any statute or other law of the United States of America or of any state;

      .4 without notice, except as specified below, sell the Collateral, or
any part thereof, in one or more parcels at public or private sale, at any of
Collateral Agent's offices or elsewhere, at such time or times, for cash, on
credit or for future delivery, and at a commercially reasonable price or
prices and on other commercially reasonable terms. Pledgor agrees that, to the
extent notice of sale shall be required by law, at least ten (10) days' notice
to Pledgor of the time and the place of any public sale or the time after
which any private sale is to be made shall constitute reasonable notification.
At any sale of the Collateral, if permitted by law, Collateral Agent may bid
(which bid may be, in whole or in part, in the form of cancellation of
indebtedness) for the purchase of the Collateral or any portion thereof for
the account of Collateral Agent on behalf of the Secured Parties and the
Funding Corporation. Collateral Agent shall not be obligated to make any sale
of the Collateral regardless of notice of sale having been given. Collateral
Agent may adjourn any public or private sale from time to time by announcement
at the time and place fixed therefor, and such sale may, without further
notice, be made at the time and place to which it was so adjourned. Collateral
Agent shall incur no liability as a result of the manner of sale of the
Collateral, or any part thereof, at any private sale conducted in a
commercially reasonable manner. Pledgor hereby waives, to the extent permitted
by applicable law, any claims against Collateral Agent arising by reason of
the fact that the price at which the Collateral, or any part thereof, may have
been sold at a private sale was less than the price which might have been
obtained at public sale or was less than the aggregate amount of the
Obligations, even if Collateral Agent accepts the first offer received which
Collateral Agent in good faith deems to be commercially reasonable under the
circumstances and does not offer the Collateral to more than one offeree. To
the full extent permitted by law, Pledgor shall have the burden of proving
that any such sale of the Collateral was conducted in a commercially
unreasonable manner. To the extent permitted by law, Pledgor hereby
specifically waives all rights of redemption, stay or appraisal which it has
or may have under any law now existing or hereafter enacted. Pledgor
authorizes Collateral Agent, at any time and from time to time, to execute, in
connection with a sale of the Collateral pursuant to the provisions of this
Pledge Agreement, any endorsements, assignments or other instruments of
conveyance or transfer with respect to the Collateral;

      .5 upon notice to Pledgor, register the Collateral in the name of
Collateral Agent or its nominee as pledgee or otherwise take such action as
Collateral Agent shall in its sole discretion deem necessary or desirable with
respect to the Collateral, and Collateral Agent or its nominee may thereafter,
in its sole discretion, without notice, exercise all voting, consent,
managerial and other rights relating to the Collateral and exercise any and
all rights of conversion, exchange, subscription or any other rights,
privileges or options pertaining to the Collateral as if it were the absolute
owner thereof, including, without limitation, all rights of Pledgor under the
Partnership Agreement, including, without limitation, the right to (i) receive
all permitted distributions, if any, made for the account of Pledgor under the
Partnership Agreement and (ii) exchange any and all of the Collateral upon the
merger, consolidation, reorganization, recapitalization or other readjustment
of Del Ranch, all without liability except to account for property actually
received by Collateral Agent, but Collateral Agent shall have no duty to
exercise any of the aforesaid rights, privileges or options and shall not be
responsible for any failure to do so or delay in so doing; and

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          .6 exercise in respect of the Collateral, in addition to other rights
and remedies provided for herein or otherwise available to it, all the rights
and remedies of a secured party after default under the Code.

           7. Application of Proceeds. The net proceeds of any foreclosure,
collection, recovery, receipt, appropriation, realization or sale of the
Collateral shall be applied in the order of priority specified in the
Intercreditor Agreement. If all Obligations and any other amounts due under
this Pledge Agreement and the Intercreditor Agreement have been indefeasibly
paid, satisfied and discharged in full, any surplus then remaining shall be
paid to Pledgor, if it is lawfully entitled to receive the same or shall be
paid to whomsoever a court of competent jurisdiction may direct.

           8. Security Interest Absolute. All the rights of Collateral Agent
and any of the other Secured Parties and the Funding Corporation hereunder and
the Security Interest and all obligations of Pledgor hereunder shall be
absolute and unconditional irrespective of:

                .1. any lack of validity or enforceability of the Project
      Documents or the Partnership Agreement or the Financing Documents or any
      other agreement or instrument relating thereto;

                .2. any change in the time, manner or place of payment of, or
      in any other term of, all or any of the Obligations, or any other
      amendment or waiver of or any consent to any departure from the Project
      Documents, the Partnership Agreement or the Financing Documents;

                .3. any exchange or release of any Collateral or any other
      collateral, or the non-perfection of any of the Security Interest, or
      any release or amendment or waiver of or consent to or departure from
      any guaranty, for all or any of the Obligations;

                .4. to the full extent permitted by law, any other
      circumstance that might otherwise constitute a defense available to, or
      a discharge of, Pledgor or any third party pledgor; or

                .5. the failure by any of the Pledgors to fulfill its
      obligations under this Pledge Agreement.

           9.    Collateral Agent Appointed Attorney-in-Fact.

                .1. Powers. Pledgor hereby irrevocably constitutes and
appoints Collateral Agent and any officer or agent thereof, with full power of
substitution, as Pledgor's true and lawful attorney-in-fact (which appointment
as attorney-in-fact shall be coupled with an interest), with full authority in
the place and stead of Pledgor and in the name of Pledgor or otherwise, from
time to time upon the occurrence and during the continuance of any Event of
Default under the Partnership Credit Agreement or the Partnership Guarantee in
Collateral Agent's discretion, to take any action and to execute any and all
documents and instruments which Collateral Agent may deem necessary or
advisable to accomplish the purposes of this Pledge Agreement, without notice
to Pledgor, including, without limitation:

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                     .1. to exercise all partnership rights, powers and
      privileges to the same extent Pledgor shall have been entitled under the
      Partnership Agreement and in accordance with applicable law, including,
      without limitation, all voting rights of Pledgor as partner of Del
      Ranch;

                     .2. to receive, endorse and collect all instruments made
      payable to Pledgor representing any interest payment or other
      distribution in respect of the Collateral or any part thereof and to
      give full discharge for the same and to file any claim or to take any
      other action or proceeding in any court of law or equity or otherwise
      deemed appropriate by Collateral Agent for the purpose of collecting any
      and all of such dividends, payments or other distributions;

                      3. to pay or discharge taxes and liens levied or placed
      on the Collateral; and

                     .4. (a) to direct any party liable for any payment in
      respect of or arising out of any of the Collateral to make payment of
      any and all moneys due or to become due in connection therewith directly
      to Collateral Agent or as Collateral Agent shall otherwise direct, (b)
      to ask or make demand for, collect, receive payment of and receipt for,
      any and all moneys, claims and other amounts due or to become due at any
      time in respect of or arising out of any Collateral, (c) to commence and
      prosecute any suits, actions or proceedings at law or in equity in any
      court of competent jurisdiction to collect the Collateral or any part
      thereof and to enforce any other right in respect of any Collateral, (d)
      to defend any suit, action or proceeding brought against Pledgor with
      respect to any Collateral, (e) to settle, compromise or adjust any suit,
      action or proceeding described in clause (d) above and, in connection
      therewith, to give such discharges or releases as Collateral Agent
      acting in good faith may deem appropriate and (f) generally, to sell,
      transfer, pledge and make any agreement with respect to or otherwise
      deal with any of the Collateral as fully and completely as though
      Collateral Agent were the absolute owner thereof for all purposes, and
      (g) to do, at Collateral Agent's option and at Pledgor's expense, at any
      time, or from time to time, all acts and things which Collateral Agent
      acting in good faith deems necessary to protect, preserve or realize
      upon the Collateral and the Security Interest granted herein and to
      effect the intent of this Pledge Agreement, all as fully and effectively
      as Pledgor might do.

                .2. Other Powers. Pledgor further authorizes Collateral
Agent, at any time and from time to time (i) to execute, in connection with
any sale provided for hereunder, any endorsements, assignments or other
instruments of conveyance or transfer with respect to the Collateral and (ii)
to the full extent permitted by applicable law, to file one or more financing
or continuation statements, and amendments thereto, relative to all or any
part of the Collateral without the signature of Pledgor.

           10. Collateral Agent May Perform. Upon the occurrence and during
the continuance of an Event of Default under the Partnership Credit Agreement
or the Partnership Guarantee, Collateral Agent, without releasing Pledgor from
any obligation, covenant or condition hereof, itself may make any payment or
perform, or cause the performance of, any such obligation, covenant, condition
or agreement or any other action in such manner and to such extent as
Collateral Agent may deem necessary to protect, perfect or continue the
perfection of the Secured Parties' and the Funding Corporation's Security
Interest in the Collateral. Any costs or expenses incurred by

                                      10




    



Collateral Agent in connection with the foregoing shall be governed by the
Indenture and the Financing Documents and constitute Obligations secured
hereby.

           11.  No Duty on Collateral Agent's Part,
                Limitation on Collateral Agent's Obligations.

                .1. No Duty on Collateral Agent's Part. The powers conferred
on Collateral Agent hereunder are solely to protect Collateral Agent's
interests in the Collateral and shall not impose any duty upon it to exercise
any such powers. Collateral Agent shall be accountable only for amounts that
it actually receives as a result of the exercise of such powers.

                .2. Limitations on Obligations. Without limiting the
effectiveness of Section 30 hereof, anything herein to the contrary
notwithstanding, Pledgor shall remain liable under the Partnership Agreement
and any other Project Document or Financing Document to which it is a party to
the extent set forth therein to perform all of its duties and obligations
thereunder, to the same extent as if this Pledge Agreement had not been
executed. The exercise by Collateral Agent of any of the rights or remedies
hereunder shall not release Pledgor from any of its duties or obligations
under the Partnership Agreement or any other Project Document or Financing
Document to which it is a party. All of the Collateral is hereby assigned to
Collateral Agent solely as security, and Collateral Agent shall have no duty,
liability or obligation whatsoever with respect to any of the Collateral,
unless Collateral Agent so elects in writing consistent with its rights under
this Pledge Agreement.

           12. Reasonable Care. Collateral Agent shall exercise the same
degree of care hereunder as it exercises in connection with similar
transactions for its own account. Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral in
its possession if the Collateral is accorded treatment substantially equal to
that which Collateral Agent accords or would accord collateral held by
Collateral Agent in similar transactions for its own account. Without limiting
the generality of the foregoing and except as otherwise provided by applicable
law, Collateral Agent shall not be required to marshall any collateral,
including, without limitation, the Collateral subject to the Security Interest
created hereby and any guaranties of the Obligations, or to resort to any item
of Collateral or guaranties in any particular order; and all of Collateral
Agent's rights hereunder and in respect of such Collateral and guaranties
shall be cumulative and in addition to all other rights, however existing or
arising. To the extent that Pledgor lawfully may, Pledgor hereby (a) agrees
that it will not invoke any law relating to the marshalling of collateral
which might cause delay in or impede the enforcement of Collateral Agent's
rights under this Pledge Agreement or under any other instrument evidencing
any of the Obligations or under which any of the Obligations is outstanding or
by which any of the Obligations is secured or guaranteed and (b) irrevocably
waives the benefits of all Laws and any and all rights to equity of redemption
or other rights of redemption that it may have in equity or at law with
respect to the Collateral.

           13. Role of Collateral Agent. The rights, duties, liabilities and
immunities of Collateral Agent and its appointment and replacement hereunder
shall be governed by the Intercreditor Agreement.

           14. Waiver of Trial by Jury. WITH REGARD TO THIS PLEDGE AGREEMENT,
EACH OF PLEDGOR AND COLLATERAL AGENT HEREBY WAIVES THE RIGHT TO A TRIAL BY
JURY IN ANY ACTION OR PROCEEDING AND FOR ANY COUNTERCLAIM THEREIN.

                                      11




    



           15. Notices. All notices, demands, requests and other
communications required or permitted hereunder shall be in writing, and shall
be given and deemed to have been given in accordance with Section 6.1 of the
Partnership Credit Agreement and the information set forth immediately below
shall apply to:

      If to Magma:

                          Blackstone Center
                          302 South 36th Street, Suite 400
                          Omaha, Nebraska  68131

      If to CEOC:

                          Blackstone Center
                          302 South 36th Street, Suite 400-C
                          Omaha, Nebraska  68131

      If to Conejo:

                          Blackstone Center
                          302 South 36th Street, Suite 400-G
                          Omaha, Nebraska  68131


           16. Absence of Fiduciary Relation. Collateral Agent undertakes to
perform or to observe only such of its agreements and obligations as are
specifically set forth in this Pledge Agreement, the Intercreditor Agreement
or any other Security Document, and no implied agreements, covenants or
obligations with respect to Pledgor, any Affiliate of Pledgor or any other
party to the Partnership Agreement or any other Project Document or Security
Document to which Pledgor is a party shall be read into this Pledge Agreement
against Collateral Agent or any of the Secured Parties and the Funding
Corporation; neither Collateral Agent nor any of the Secured Parties and the
Funding Corporation in its and their capacity as such is a fiduciary of and
shall not owe or be deemed to owe any fiduciary duty to Pledgor, any Affiliate
of Pledgor or any other party to any Project Document or Financing Document to
which Pledgor is a party, except as otherwise specifically required by law.

           17. Survival of Representations and Warranties. All agreements,
representations and warranties made herein shall survive the execution and
delivery of this Pledge Agreement and the other Financing Documents and
repayment of the Obligations, and shall be deemed to be material and to have
been relied upon by Collateral Agent and any of the other Secured Parties and
the Funding Corporation, regardless of any investigation made by or on behalf
of any of Collateral Agent and any of the other Secured Parties and the
Funding Corporation. Notwithstanding anything in this Pledge Agreement or
implied by law to the contrary, the agreements and obligations of Pledgor set
forth in Section 4.6 shall survive until the payment or prepayment in full of
the Obligations and the termination of this Pledge Agreement in accordance
with Section 27 hereof.

           18. No Waiver; Cumulative Remedies. By exercising or failing to
exercise any of its rights, options or elections hereunder (without also
expressly waiving the same in writing), Collateral Agent, on behalf of the
Secured Parties and the Funding Corporation, shall not be deemed to have
waived any breach or default on the part of Pledgor or to have released
Pledgor from any of its

                                      12




    



obligations secured hereby. No failure on the part of Collateral Agent to
exercise, and no delay in exercising (without also expressly waiving the same
in writing) any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
privilege preclude any other or further exercise thereof, or the exercise of
any other right, power or privilege. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law. Collateral
Agent, acting on behalf of the Secured Parties and the Funding Corporation,
shall have all of the rights and remedies granted under the Intercreditor
Agreement or any Financing Document, and available at law or in equity, and
these same rights and remedies may be pursued separately, successively or
concurrently against Pledgor or any Collateral, at the discretion of
Collateral Agent.

           19. Severability. Any provision of this Pledge Agreement which is
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization, without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of
such provision in any other jurisdiction. Where provisions of any law or
regulation resulting in such prohibition or unenforceability may be waived
they are hereby waived by Pledgor and Collateral Agent to the full extent
permitted by law so that this Pledge Agreement shall be deemed a valid,
binding agreement, and the Security Interest created hereby shall constitute a
continuing first lien on and first perfected security interest in the
Collateral, in each case enforceable in accordance with its terms.

           20.    Exculpatory Provisions; Reliance by Collateral Agent.

                .1. Exculpatory Provisions. Neither Collateral Agent, the
Funding Corporation nor any other Secured Party, nor any of their respective
officers, directors, employees, agents, attorneys-in-fact or affiliates (the
"Exculpated Parties") shall be liable to Pledgor for any action taken or
omitted to be taken by it or them under or in connection with this Pledge
Agreement, the Partnership Agreement or any other Project Document or
Financing Document to which Pledgor is a party, except for the Exculpated
Parties' own gross negligence or willful misconduct, or responsible in any
manner to any Person for any recitals, statements, representations or
warranties made by Pledgor or any officer thereof contained in this Pledge
Agreement, the Partnership Agreement or any other Project Document or
Financing Document to which Pledgor is a party or in any certificate, report,
statement or other document referred to or provided for in, or received by
Collateral Agent, Funding Corporation or any other Secured Party under or in
connection with, this Pledge Agreement, the Partnership Agreement or any other
Project Document or Financing Document to which Pledgor is a party or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Pledge Agreement, the Partnership Agreement or any other Project Document
or Financing Document to which Pledgor is a party or for any failure of
Pledgor to perform any of the Obligations. Neither Collateral Agent, Funding
Corporation nor any other Secured Party shall be under any obligation to any
Person to ascertain or to inquire as to the observance or performance of any
of the agreements contained in, or conditions of, this Pledge Agreement, the
Partnership Agreement or any other Project Document or Financing Document to
which Pledgor is a party, or to inspect the properties or records of Pledgor.

                .2. Reliance by Collateral Agent. Collateral Agent shall be
entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, consent, certificate, affidavit, letter,
cablegram, telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons and upon advice
and statements of legal counsel

                                      13




    



(including, without limitation, counsel to Pledgor), independent accountants
and other experts selected by Collateral Agent. Collateral Agent shall have no
obligation to any Person to act or refrain from acting or exercising any of
its rights under this Pledge Agreement.

           21. Amendment. No modification or waiver of any of the provisions
of this Pledge Agreement shall be binding on Collateral Agent, except as
expressly set forth in a writing duly signed and delivered by Collateral Agent
and which is otherwise in accordance with Section 6.2 of the Partnership
Credit Agreement.

           22. Successors and Assigns. This Pledge Agreement shall be binding
upon and inure to the benefit of Pledgor and Collateral Agent for the benefit
of the Secured Parties and the Funding Corporation and their respective
successors and assigns. In the event of any assignment or transfer by the
Funding Corporation or any other Secured Party of any instrument evidencing
all or any part of the Obligations, the holder of such instrument shall,
subject to the Partnership Credit Agreement and the Partnership Guarantee, be
entitled to the benefits of this Pledge Agreement.

           23. Number and Gender. Whenever used in this Pledge Agreement, the
singular number shall include the plural and the plural the singular, and the
use of any gender shall be applicable to all genders.

           24. Subrogation, etc. Notwithstanding any payment or payments made
by Pledgor or the exercise by Collateral Agent of any of the remedies provided
under this Pledge Agreement or any of the Financing Documents, Pledgor shall
have no claim (as defined in 11 U.S. C. ss. 101 (5)) of subrogation to any of
the rights of the Secured Parties and the Funding Corporation against Del
Ranch, Pledgor or any Collateral or guaranty held by the Secured Parties and
the Funding Corporation for the satisfaction of any of the Obligations, nor
shall Pledgor have any claims (as defined in 11 U.S.C. ss. 101 (5)) for
reimbursement, indemnity, exoneration or contribution from Del Ranch in
respect of payments made by Pledgor hereunder. Notwithstanding the foregoing,
if any amount shall be paid to Pledgor on account of such subrogation,
reimbursement, indemnity, exoneration or contribution rights at any time, such
amount shall be held by Pledgor in trust for the Secured Parties and the
Funding Corporation, segregated from other funds of Pledgor, and shall be
turned over to Collateral Agent for the benefit of the Secured Parties and the
Funding Corporation, in the exact form received by Pledgor (duly endorsed by
Pledgor to Collateral Agent for the benefit of the Secured Parties and the
Funding Corporation, if required), to be applied against such amounts in such
order as Collateral Agent may elect.

           25. Captions. The captions, headings and table of contents used in
this Pledge Agreement are for convenience only and do not and shall not be
deemed to affect, limit, amplify or modify the terms and provisions hereof.

           26. Applicable Law. This Pledge Agreement shall be governed by,
and construed and interpreted in accordance with, the laws of the State of
California.

           27. Continuing Security Interest; Termination. This Pledge
Agreement shall create a continuing assignment, pledge and first priority
Security Interest in the Collateral, subject only to Permitted Liens, and
shall remain in full force and effect for the benefit of Collateral Agent and
the other Secured Parties and the Funding Corporation until all Obligations to
be paid or performed by Partnership Guarantors under the Partnership Credit
Agreement and the Partnership Guarantee have been paid and performed in full.
Upon the happening of such event, the Security Interest granted

                                      14



    



hereby shall terminate. Upon such termination, Collateral Agent shall, upon
the request and at the expense of Pledgor, execute and deliver to Pledgor such
documents as Pledgor shall reasonably request to evidence such termination or
expiration.

           28. Payments Set Aside. To the extent that Pledgor or the
Partnership Guarantors or any other Person on behalf of Pledgor or the
Partnership Guarantors makes a payment or payments to Collateral Agent and/or
any other Secured Party, or Collateral Agent and/or any other Secured Party
enforce the Security Interests or Collateral Agent exercises its right of
set-off, and such payment or payments or the proceeds of such enforcement or
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, state or
federal law, common law or equitable cause, then to the extent of such
recovery, the Obligations or any part thereof originally intended to be
satisfied, and this Pledge Agreement and all Liens, rights and remedies
therefor, shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or set-off had not occurred.


           29. Counterparts. This Pledge Agreement may be executed in any
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.

           30 . Non-Recourse. Notwithstanding any other provision hereof,
Collateral Agent agrees that its only remedy hereunder shall be to proceed
against the Collateral and that there shall be no recourse to the Pledgor, its
shareholders, officers, directors or employees.

                                      15




    




           IN WITNESS WHEREOF, the parties hereto have caused this Pledge
Agreement to be duly executed as of the day and year first written above.

                                     MAGMA POWER COMPANY,
                                     a Nevada corporation

                                     By:  /s/ John G. Sylvia
                                         ------------------------
                                     Name:    John G. Sylvia
                                         -------------------------
                                     Title:   Senior Vice President
                                         --------------------------



                                     CALENERGY OPERATING COMPANY,
                                     a Delaware corporation


                                     By:  /s/ John G. Sylvia
                                         ------------------------
                                     Name:    John G. Sylvia
                                         -------------------------
                                     Title:   Senior Vice President
                                         --------------------------



                                     CONEJO ENERGY COMPANY,
                                     a California corporation


                                     By:  /s/ John G. Sylvia
                                         ------------------------
                                     Name:    John G. Sylvia
                                         -------------------------
                                     Title:   Senior Vice President
                                         --------------------------




                                     CHEMICAL TRUST COMPANY OF CALIFORNIA,
                                     a California corporation,
                                     as Collateral Agent


                                     By:  /s/ Rose Maravilla
                                         ------------------------
                                     Name:    R. I. Maravilla
                                         -------------------------
                                     Title:   Assistant Vice President
                                         --------------------------




                                     16