News Release
Feb. 16, 1999

DUKE ENERGY INTERNATIONAL SIGNS AGREEMENT WITH TASMANIA’S HYDRO ELECTRIC CORPORATION

HOUSTON -- Stakeholders in the Tasmania Natural Gas Project today announced a major step in the move toward bringing offshore natural gas to that island state offshore Australia.

Duke Energy International (DEI) has signed a memorandum of understanding with the Hydro Electric Corporation that provides DEI with usage rights to the Bell Bay power plant, one of the more important aspects of the project to bring natural gas to Tasmania and provide energy to the proposed Crest/Multiplex magnesium plant.

The memorandum of understanding is the first step in establishing a commercial relationship between DEI and Hydro that will culminate in the conversion of the Bell Bay thermal power station to gas firing by mid-2002 and the possible development of other joint power generating projects in Tasmania.

The state government has taken a keen interest in the commercial negotiations between DEI and Hydro to ensure the agreement reflects the government’s overall objective to provide a new source of energy to encourage industrial development. It was for that reason that the government selected DEI last May to study the prospects of bringing natural gas to the state.

Kevin Howell, DEI’s group general manager for commercial development, said the agreement was a significant step in DEI’s overall feasibility study. "The move paves the way for development of gas-fired electricity generation to power projects such as Crest/Multiplex’s magnesium plant proposed for Bell Bay," he said.

Duke Energy International is a wholly owned subsidiary of Duke Energy. Since opening its Australia office in 1998, DEI has established itself as a leading energy force in the Asia-Pacific region. DEI owns and operates the 627km Queensland Gas Pipeline and in December 1998 acquired the rights to develop and operate the 795km Eastern Gas Pipeline from Longford in Victoria to Sydney. DEI continued to build its growing business in the Asia-Pacific region with the January announcement that it was acquiring Broken Hill Proprietary’s power business.

Duke Energy (NYSE:DUK) is a global energy company with more than $26 billion in assets. Headquartered in Charlotte, N.C., the company reaches into more than 50 countries, producing energy, transporting energy, marketing energy and providing energy services. In the United States, Duke Energy companies provide electric service to approximately two million customers in North Carolina and South Carolina; operate interstate pipelines that deliver natural gas to various regions of the country; and are leading marketers of electricity, natural gas and natural gas liquids. Additional information about the company is available on the Internet at: www.duke-energy.com.

Contact: Danny Gibbs
Phone: (704) 373-6680
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Email: dpgibbs@duke-energy.com
Contact: Michelle Barry
Phone: (414) 790-4800
24 Hour Phone: (704) 382-8333
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