News Release
August 20, 2004

UPDATE: FIRE AT MOSS BLUFF NATURAL GAS STORAGE FACILITY

HOUSTON – Duke Energy Gas Transmission said today a fire at its Moss Bluff salt cavern storage facility could continue until early Saturday morning, when the approximately 6 billion cubic feet of stored gas being released from Cavern #1 will have burned off. However, Boots and Coots International Well Control (a global emergency response company specializing in oil and gas fires) remains on site and continues to assess how to extinguish the fire.

The cause of the fire is under investigation, and damage assessments will be made after it is extinguished. Duke Energy has standard general liability and property insurance and does not expect this incident to have a material financial impact.

The fire ignited early Thursday morning at the facility outside Houston. It increased in size early Friday after an above-ground valve structure gave way, resulting in a larger release of gas.

At about 1:30 a.m. CT the valve structure above Cavern #1 gave way due to the intense heat of the flame, increasing the release of gas. The flame increased from approximately 100 feet to up to 1000 feet.

All personnel on the site have been accounted for, and no injuries were reported.

Duke Energy Gas Transmission recommended to emergency personnel in Liberty and Chambers counties that a three-mile area around the facility be evacuated.  The company is assisting the sheriff’s departments in relocating residents.

Located in Liberty County, Texas, approximately 40 miles northeast of Houston, the Moss Bluff salt cavern storage facility has three separate storage caverns. This site provides natural gas producers and shippers with a total of 16 billion cubic feet of storage capability, with approximately 8 billion cubic feet of storage capacity in Cavern #1.  Caverns #2 and #3 are unaffected.

The facility has been isolated from five nearby pipelines, which continue to operate. However, due to the incident, service to Moss Bluff storage customers has been suspended.

Duke Energy Gas Transmission is a North American leader in developing energy infrastructure and connecting major natural gas supply basins to growing markets. The company’s natural gas operations include more than 17,500 miles of transmission pipeline and about 250 billion cubic feet of storage capacity in Canada and the United States. More information on DEGT can be found at:  http://www.duke-energy.com/businesses/companies/degt.asp

Duke Energy is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated, and an affiliated real estate company. Duke Energy supplies, delivers and processes energy for customers in North America and selected international markets. In 2004, the company celebrates a century of service with the 100th anniversary of its electric utility Duke Power. Headquartered in Charlotte, N.C., Duke Energy 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.

Contact: Gretchen Krueger
Phone: 713-627-4072
24-Hour Phone: 704-382-8333
e-mail: gdkrueger@duke-energy.com