News Release
March 07, 2000

DUKE ENERGY NORTH AMERICA ANNOUNCES TRANSACTIONS TOTALING $1 BILLION AND 2,000 MEGAWATTS

HOUSTON – Duke Energy North America (DENA) today announced the start of construction of three new merchant generation projects totaling 1,500 megawatts. In a fourth transaction, DENA announced the sale of its remaining 78.5 percent interest in the 500-megawatt Hidalgo Energy Facility to an affiliate of Calpine Corporation for $235 million.

A leading provider of wholesale energy, DENA’s portfolio currently includes 4,400 megawatts in operation; nine sites under construction totaling 4,500 megawatts; and an additional 14,800 megawatts in advanced development, scheduled for commercial operation by summer 2003.

"These four separate deals clearly demonstrate DENA’s active portfolio management strategy and highlight our origination efforts and ability to maintain focus on managing our total energy portfolio," said Jim Donnell, president and chief executive officer of DENA. "DENA’s depth in development, its transaction and commercial skills, coupled with Duke Energy’s core engineering, procurement and construction competencies, provide speed to market. They allow us to identify market opportunities and seize them at just the right time to capture value for our shareholders and efficiently recycle capital across the organization to support ongoing development and acquisition activities."

DENA is constructing three new 500-megawatt, natural gas-fired, combined-cycle, generating plants to serve growing demand and reliability needs in the Southeast and Southcentral United States. Construction has commenced on the McClain Energy Facility, in Newcastle, Okla., and the Hinds Energy Facility, in Jackson, Miss., and will soon begin at the Attala Energy Facility, located between McAdams and Kosciusko, Miss.

All three plants will be operational by second quarter 2001. Duke Engineering & Services is providing support services; Duke/Fluor Daniel will design, construct and operate the facilities; while Duke Energy Merchants will arrange gas supply and market the facilities’ power. Duke Energy’s Texas Eastern Transmission will transport fuel to the two plants in Mississippi.

"Our ability to deliver these new energy projects is a result of the strong partnerships we have forged with communities and community leaders in Mississippi and Oklahoma," said Donnell. "The energy produced by these facilities, as well as DENA’s economic investment in local communities, provides for enhanced regional energy reliability and sustainable economic development including employment opportunities during the construction and life of the facility."

The Hidalgo Energy Facility is a 500-megawatt, natural gas-fired, combined-cycle generation plant located in Edinburg, Texas. DENA broke ground on the facility in first quarter 1999 and expects commercial operation to commence by June 2000. The sale to Calpine is subject to all appropriate government approvals. DENA announced the sale of 21.5 percent of the plant’s electric output to the Brownsville Public Utilities Board in fourth quarter 1999.

Duke Energy North America (DENA), located in Houston, Texas, is a leading provider of competitively priced wholesale energy. DENA develops, owns and manages a portfolio of environmentally friendly, competitively priced merchant generation throughout the United States. DENA is a wholly owned subsidiary of Duke Energy.

Duke Energy, a diversified multi-national energy company, creates value for customers and shareholders through an integrated network of energy assets and expertise. Duke Energy manages a dynamic portfolio of natural gas and electric supply, delivery and trading businesses -- generating revenues of nearly $22 billion in 1999. Duke Energy, headquartered in Charlotte, N.C., is a Fortune 100 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: www.duke-energy.com.

Contact: Jennifer Pierce
Phone: 713-627-5719
24 Hour Phone: 704-382-8333
Email: jmpierce@duke-energy.com
Contact: Rick Rhodes
Phone: 704-382-3747
24 Hour Phone: 704-382-8333
Email: jrrhodes@duke-energy.com
Contact: Richard Fernandez
Phone: 713-627-5984
24 Hour Phone: 704-382-8333
Email: media_relations@duke-energy.com