News Release
April 26, 2001

DUKE ENERGY FIELD SERVICES TO ACQUIRE CANADIAN MIDSTREAM SERVICES LTD.

DEFS To More Than Double Natural Gas Processing Capacity In Western Canada

DENVER – Duke Energy Field Services (DEFS), a leading gatherer and processor of natural gas in the United States, today announced plans to significantly strengthen its midstream asset base in western Canada.

DEFS, through its wholly-owned subsidiary Duke Energy Midstream Services Canada, Ltd., disclosed it has entered into a definitive agreement to acquire the outstanding shares of Canadian Midstream Services, Ltd. (CMSL). Following the completion of the proposed transaction, DEFS’ net natural gas processing capacity in western Canada will increase from 205 million cubic feet per day (MMcf/d) to 555 MMcf/d and it will have an ownership interest in eight gathering and processing facilities. Terms of the proposed transaction were not disclosed.

"The acquisition of CMSL continues DEFS’ strategy of investing in strategic North American midstream assets," said Jim Mogg, chairman, president, and chief executive officer of DEFS. "The CMSL facilities come with distinct competitive advantages coupled with significant growth opportunities in three geographically diverse operating areas. This acquisition is an excellent means to increase our Canadian midstream asset base."

In addition to DEFS’ existing assets in the Peace River Arch area, DEFS will now own midstream operations in three new core areas: the Brazeau River area in the foothills of Alberta, the Nevis/Fenn area in central Alberta and the Pesh Peggo region of northeastern British Columbia.

The successful completion of the proposed acquisition is subject to the approval of Investment Canada.

DEFS is a premier North American midstream energy company that leads or is among the nation’s leaders in the gathering, processing, transportation, marketing and storage of natural gas and the production, transportation and marketing of natural gas liquids (NGLs). DEFS’ 2,600 employees operate in 11 states and across five of the largest natural gas producing regions in North America, extending from western Canada to the Gulf Coast. The company owns and operates 65 plants and 57,000 miles of pipeline. The Denver-based company had revenues of $9.1 billion and assets of $6.1 billion in 2000. DEFS also owns the general partner of TEPPCO Partners, L.P., a publicly traded master limited partnership.

DEFS was formed by combining the Duke Energy and Phillips Petroleum natural gas gathering and processing businesses. Duke Energy owns approximately 70 percent of the joint venture and Phillips Petroleum owns about 30 percent. More information is available about the company at www.defs.com.

Phillips is an integrated petroleum company with interests around the world. Headquartered in Bartlesville, Oklahoma, the company has 12,400 employees and $20.5 billion of assets, and had $21.2 billion of revenues in 2000.

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 more than $49 billion in 2000. 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: Tom Long
Phone: 303/605-1731
24 Hour Phone: 704/382-8333
Email: telong@duke-energy.com