AGL Resources and Piedmont Natural Gas Reach Agreement to Restructure Ownership Interests in SouthStar Energy Services

/PRNewswire/ -- AGL Resources Inc. (NYSE:AGL) subsidiary Georgia Natural Gas Company (GNGC) and Piedmont Energy Company, a subsidiary of Piedmont Natural Gas (NYSE:PNY) , today announced an agreement to restructure the two firms' ownership interests in SouthStar Energy Services (SouthStar). Under the terms of the agreement, effective January 1, 2010, AGL Resources will purchase an additional 15 percent ownership share in SouthStar from Piedmont for $57.5 million. As a result, AGL Resources will have an 85 percent ownership in the business and will be entitled to 85 percent of its annual earnings, while Piedmont will retain a 15 percent earnings and ownership share in SouthStar after the sale.

The agreement, which has been approved by both companies' boards of directors, also resolves issues concerning AGL Resources' option to purchase Piedmont's ownership interest in SouthStar. As part of the agreement, the pending lawsuit in the Delaware courts will be dismissed and AGL Resources will not have any further option rights to Piedmont's remaining 15 percent ownership interest.

The agreement is subject to the approval and consent of the Georgia Public Service Commission.

"Piedmont has always been a very good partner, and we look forward to continuing our longstanding relationship with them," said John W. Somerhalder II, AGL Resources' Chairman, President and CEO. "We reached an agreement that works well for both companies in terms of providing certainty around the partnership structure and creating value for our respective shareholders."

Commenting on the agreement, Piedmont's Chairman, President and CEO, Thomas E. Skains said, "We are happy to conclude this agreement with AGL and believe our strategic interests in SouthStar will be more closely aligned as a result. This has been a good partnership for both of our companies and we value the relationship we have with AGL. The nature of this agreement, which will simplify and strengthen our joint venture involvement in SouthStar, also reaffirms the core focus of our business as the safe and efficient distribution of natural gas to our growing utility markets in North Carolina, South Carolina, and Tennessee."

About AGL Resources

AGL Resources (NYSE:AGL) , an Atlanta-based energy services company, serves approximately 2.3 million customers in six states. The company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout North America. As a 70 percent owner in the SouthStar partnership currently, AGL Resources markets natural gas to consumers in Georgia under the Georgia Natural Gas brand. The company also owns and operates Jefferson Island Storage & Hub, a high-deliverability natural gas storage facility near the Henry Hub in Louisiana. For more information, visit www.aglresources.com.

About Piedmont Natural Gas

Piedmont Natural Gas is an energy services company primarily engaged in the distribution of natural gas to more than one million residential, commercial and industrial utility customers in North Carolina, South Carolina and Tennessee, including 61,000 customers served by municipalities who are wholesale customers. Our subsidiaries are invested in joint venture, energy-related businesses, including unregulated retail natural gas marketing, interstate natural gas storage and intrastate natural gas transportation.

Additional information about Piedmont is available on the Internet at http://www.piedmontng.com/.

Forward-Looking Statements

Certain expectations and projections regarding our future performance referenced in this press release are forward-looking statements. Forward- looking statements involve matters that are not historical facts and because these statements involve anticipated events or conditions, forward-looking statements often include words such as "anticipate," "assume," "believe," "can," "could," "estimate," "expect," "forecast," "future," "goal," "indicate," "intend," "may," "outlook," "plan," "predict," "project," "seek," "should," "target," "will," "would," or similar expressions. Our expectations are not guarantees and are based on currently available competitive, financial and economic data along with our operating plans. While we believe our expectations are reasonable in view of the currently available information, our expectations are subject to future events, risks and uncertainties, and there are several factors - many beyond our control - that could cause results to differ significantly from our expectations.

Such events, risks and uncertainties include, but are not limited to, the impact of changes in state and federal legislation and regulation; actions taken by government agencies on rates and other matters; and other factors which are provided in detail in our filings with the Securities and Exchange Commission, which we incorporate by reference in this press release. Forward-looking statements are only as of the date they are made, and we do not undertake to update these statements to reflect subsequent changes.

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