News Release
Oct. 16, 1998

DUKE ENERGY SELLS TRANSPORT AND TRADING COMPANY TO TEPPCO PARTNERS, L.P.

HOUSTON — Duke Energy Corporation today sold Duke Energy Transport and Trading Company (DETTCO) to TEPPCO Partners, L.P. (NYSE: TPP) for TEPPCO limited partnership units.

Duke Energy will receive TEPPCO Class B limited partnership units, further linking the success of Duke Energy and TEPPCO. Duke Energy is the general partner of TEPPCO. The Class B Units will represent an approximate 12% of the outstanding limited partnership interest in TEPPCO, which will increase Duke Energy’s overall limited partnership interest in TEPPCO to approximately 20 percent. The transaction is expected to close by December 1, subject to regulatory approval.

The Class B units are substantially identical to TEPPCO’s outstanding common units, but will not be listed on the New York Stock Exchange. The Class B units will be convertible into common units, if TEPPCO’s unitholders approve the conversion. If conversion is not approved within approximately 16 months, the holder of the Class B units will have the right to sell them to TEPPCO at 95.5% of the then market price of the common units.

DETTCO, based in Oklahoma City, gathers, stores, transports and markets crude oil principally in Oklahoma and Texas, operates two trunkline natural gas liquids (NGL) pipelines in South Texas and distributes lubricating oil to industrial and commercial accounts through Lubrication Services, Inc. (LSI). Since inception in 1984, DETTCO has grown steadily, making over a dozen acquisitions, mostly from the major oil companies. The crude gathering and transportation segment has historically accounted for about 71% of DETTCO’s operating margin. The NGL segment’s contribution has been about 24% with LSI accounting for the remaining 5%.

"I believe Duke Energy will receive fair consideration for DETTCO, and this amount will result in a gain to Duke Energy at the current market value of the TEPPCO units," said Jim Mogg, president of Duke Energy Field Services Inc., the parent company of DETTCO. "Duke Energy remains committed to the crude oil and NGL pipeline businesses and believes that the best vehicle to participate in the current consolidation of these segments of the industry is the master limited partnership (MLP). Because TEPPCO is an existing MLP, the logical choice for Duke Energy is to utilize TEPPCO as one of the industry’s consolidators."

"We are pleased to be able to acquire these assets," said William L. Thacker, chairman, president and chief executive officer of TEPPCO. "We view this acquisition as the first step in our entry into the crude oil gathering, transportation, storage and marketing business. It will provide us with the necessary infrastructure and personnel to grow this part of our business, and we foresee a number of opportunities to expand our presence."

TEPPCO Partners, L.P. is a publicly owned master limited partnership. TE Products Pipeline Company, Limited Partnership, the operating partnership, is one of one of the largest common carrier pipelines of refined petroleum products and liquefied petroleum gases in the United States.

Duke Energy (NYSE:DUK) is a global energy company with more than $24 billion in assets. Duke Energy companies provide electric service to approximately 2 million customers; operate pipelines that deliver 12 percent of the natural gas consumed in the United States; and are leading marketers of electricity, natural gas and natural gas liquids. Globally the companies develop, own and operate energy facilities and provide engineering, management, operating and environmental services. Contact Duke Energy on the World Wide Web at http://www.duke-energy.com

Contact: John P. Barnett
Phone: (713) 627-4072
24 Hour Phone: (704) 382-8333
Email: media-relations@duke-energy.com