News Release
March 31, 1999


Duke Energy Field Services Inc. and Union Pacific Resources Group Inc. today completed the previously announced purchase by Duke Energy of UPR’s natural gas gathering, processing, fractionation and natural gas liquids (NGL) pipeline business (known as UPFuels) as well as UPR’s natural gas and NGL marketing activities for $1.35 billion.

These assets, combined with Duke Energy’s current assets, make Duke Energy the nation’s largest producer of NGLs with production in excess of 200,000 barrels per day. This purchase also makes Duke Energy one of the largest gatherers of natural gas and one of the largest marketers of natural gas and NGLs in the United States.

Under the agreement, much of UPR’s U.S. production will be gathered and processed by Duke Energy for a minimum of 10 years. UPR also will dedicate for five years most of its natural gas and NGL production to Duke Energy for marketing.

"The completion of this purchase positions Duke Energy Field Services as one of the top participants in the midstream gas industry," said Jim Mogg, president and chief executive officer of Duke Energy Field Services. "Also effective April 1, Duke Energy Field Services plans to complete the purchase of Koch’s gathering, treating and processing assets in South Texas; will finalize the new 200 million cubic feet per day cryogenic Wilcox plant in South Texas; and mark the beginning of first full month of operations for the Mobile Bay Processing Plant, of which the company is the operating partner. These events are all important for Duke Energy Field Services, and they play a significant role in moving the company forward."

UPR chairman and chief executive officer Jack Messman said, "We are very pleased that UPR and Duke Energy have closed this transaction. For UPR, the completion of this deal marks an important step toward strengthening our balance sheet and hitting our debt reduction target on schedule. Our deal with Duke Energy was the largest element in our announced program to reduce debt by $2 billion by the end of this year. This is a great way to end the first quarter and head into the balance of 1999."

The UPFuels business, along with the other previously mentioned transactions, increases to 66 from 41 the number of processing facilities in which Duke Energy owns all or a partial interest. It also increases to 52 from 30 the number of processing plants that Duke Energy operates. These acquisitions add 2.3 billion cubic feet per day (Bcf/d) of processing capacity to the existing 4.6 Bcf/d of capacity for a total of 6.9 Bcf/d of capacity.

These acquisitions also expand Duke Energy’s fractionation capacity by 118,000 barrels per day (Bbl/d) for a combined total of 200,000 Bbl/d. Additionally, approximately 8,000 miles of pipeline will be added to Duke Energy’s existing 20,000 miles of pipe for a total of approximately 28,000 miles of pipeline.

Duke Energy Field Services Inc., with approximately 300 employees in its Denver headquarters and 1,600 employees nationwide, is one of the nation’s largest gatherers and processors of natural gas and one of the largest marketers of natural gas liquids. The company also provides intrastate natural gas transportation and storage, and financial services for producers.

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:

Contact: Joe Maher
Phone: (704) 382-8323
24 Hour Phone: (704) 382-8323