Duke Energy and Williams Acquire Interest in Gulfstream Natural Gas

Subsidiaries of Duke Energy and Williams intend to jointly purchase The Coastal Corporation's 100 percent interest in Gulfstream Natural Gas System. The purchase, expected to be finalized during the fourth quarter of 2000, is subject to federal regulatory approvals and conditioned upon completion of the Coastal/El Paso Energy Corp. merger. Financial terms of the purchase were not disclosed.

"We have recognized for some time that the market will support only one new pipeline into the state of Florida," says Cuba Wadlington Jr., president and CEO, Williams' gas pipeline group. "The market will now be able to clearly see a single, viable competing pipeline into the state."

The $1.6 billion Gulfstream pipeline project has achieved two key milestones in the FERC approval process: preliminary determination on non-environmental issues and a favorable draft environmental impact statement. The company anticipates FERC approval in first quarter of 2001. The projected in-service date is June 2002. Gulfstream has precedent agreements with 10 Florida utilities and power generation facilities representing long-term commitments for the majority of its 1.1 billion cubic feet of natural gas per day capacity. Gulfstream's proposed 744-mile pipeline is designed to primarily serve Florida utilities and power-generation facilities that plan on using high-efficiency, natural gas turbines to meet the incremental demand for electric energy. Upon completion of the purchase, Duke Energy and Williams will proceed with the development of the Gulfstream project in lieu of the Buccaneer pipeline project, jointly being developed by Duke Energy and Williams to serve new markets in Florida.