News Release
August 21, 2003

DUKE ENERGY SUBSIDIARY WILL REDEEM $328 MILLION IN CALLABLE BONDS

Action Part of 2003 Plan to Reduce Debt and Trust Preferred Securities by $1.8 Billion In 2003

CHARLOTTE, N.C. – Duke Energy announced today that its PanEnergy Corp   subsidiary, a part of Duke Capital Corporation, will redeem $328 million in callable 7.75 percent bonds due 2022.

“Our decision to redeem these bonds is part of our strategy to pay down debt and trust preferred securities in 2003 by $1.8 billion,” said David Hauser, senior vice president and treasurer. “Our aggressive debt reduction actions will strengthen the company’s balance sheet during the continuing merchant energy downturn.” 

The bonds, known as Lake Charles Harbor and Terminal District (Louisiana) 7 3/4 percent Port Facilities Revenue Refunding Bonds Series 1992 (Trunkline LNG Company project), will be redeemed Sept. 18 at a price of 102 percent of the principal amount pursuant to the optional redemption provisions set forth in the indenture. Redemption notices have been distributed to bondholders this week by the Bank of New York, trustee on the bonds.

Duke Energy is a diversified multinational energy company with an integrated network of energy assets and expertise. The company manages a dynamic portfolio of natural gas and electric supply, delivery and trading businesses – meeting the energy needs of customers throughout North America and in key markets around the world. Duke Energy, headquartered in Charlotte, N.C., is a Fortune 500 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.

This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Duke Energy believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include legislative and regulatory developments; the outcomes of litigation and regulatory proceedings or inquiries; general economic conditions, including any potential effects arising from terrorist attacks and any consequential hostilities or other hostilities; the effectiveness of the company's risk management and internal controls systems; the timing and extent of changes in commodity prices for oil, natural gas, coal, electricity and interest rates; the extent of success in connecting natural gas supplies to gathering and processing systems and in connecting and expanding natural gas and electric markets; the performance of electric generation, pipeline and natural gas processing facilities; the timing and success of efforts to develop domestic and international power, pipeline, gathering, processing and other infrastructure projects; conditions of the capital markets and equity markets during the periods covered by the forward-looking statements; and other factors discussed in Duke Energy's filings with the Securities and Exchange Commission.

Contact: Terry Francisco
Phone: 704/373-6680
24-Hour Phone: 704/382-8333
e-mail: thfrancisco@duke-energy.com