News Release
Nov. 08, 2000

Duke Energy International announces customers for Tasmanian Gas Pipeline

Duke Energy International (DEI) today announced it has secured Duke Energy Board approval and identified the customer base to support the $380 million Tasmanian Gas Pipeline.

Construction will start in mid-2001 pending finalisation of environmental, licensing and regulatory approvals.

DEI President and CEO Bruce Williamson said the company was delighted to announce heads of agreement for gas supply with a range of companies including Australian Bulk Minerals and Hydro Tasmania.

"The Government is currently developing a framework for the appointment of a reticulator or reticulators to retail gas to Hobart, Launceston and other residential and business centres," he said.

Mr Williamson said the onshore surveys and environmental assessment studies were underway with public input into the environmental studies framework now being sought by the various Governments. The offshore pipeline construction contract will be let in early 2001 with the onshore construction contract let by mid-2001.

"We’ve worked very hard to demonstrate the feasibility of bringing gas ashore in Tasmania and industry has responded with strong support for our proposal. Their desire to supplement their energy needs with competitively priced natural gas means the project has progressed beyond a possibility," he said.

"The Tasmanian Gas Pipeline will provide open access to third parties interested in transporting gas on the pipeline and will offer competitively priced gas for Tasmanian industry, businesses and households."

Although DEI has a long history of building gas pipelines around the world, the Tasmanian project is especially important because of the positive impact it will have on regional communities and the state’s economy.

"In the short term, we expect construction of the pipeline will employ about 900 people. In the longer term, experience in other parts of Australia indicates that where gas enters a market for the first time, growth and jobs follow," he said.

The pipeline will start at Longford in Victoria, cross Bass Strait and come ashore in the region north of George Town. The 305km offshore pipeline will rest on the bed of Bass Strait, while the 430km onshore pipeline will stretch to Port Latta in the north west, and to Hobart in the south. The pipeline is expected to be completed in the first half of 2002.

Gas will be sourced from Esso Australia Resources Pty Ltd and BHP Petroleum (Bass Strait) Pty Ltd in Victoria, the only companies able to demonstrate adequate long-term reserves and supply competitively priced gas to meet DEI’s timetable.

Mr Williamson said an extensive community consultation program was now well underway.

"We will be working closely with all of the various community and government stakeholders over the coming months to ensure selection of the best possible pipeline route within the identified corridor," he said.

Mr Williamson said this was the most complex project Tasmania had encountered in decades but the benefits were numerous.

"There are significant infrastructure, legislative and regulatory considerations to be addressed prior to the introduction of this new form of energy to the State but DEI has the resources and experience to make this project a reality," he said.

DEI, a wholly owned subsidiary of Duke Energy, is one of the world’s leading international energy companies offering energy trading and marketing, risk management, natural gas and power development expertise and operations services across Latin America, Europe and the Asia Pacific. DEI’s Asia Pacific energy portfolio includes 1585km of natural gas pipelines in operation and under construction; 780 gross megawatts of thermal power generation; and energy trading and marketing located in Australia, New Zealand and Indonesia.

Duke Energy, a diversified multinational 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 US$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 or www.duke-energy.com.au

Contact: Michelle Barrry
Phone: 0414 790 480
24 Hour Phone: 0414 790 480
Email: mlbarry@duke-energy.com