Dynegy Inc. — formerly NGC Corp. — plans to construct agas-fired, four-unit, 600 MW generation facility in RockinghamCounty, NC, and Duke Power, the electric utility of Duke Energy,signed a letter of intent to buy the 600 MW of capacity and energygenerated by the power plant.

Dynegy Power Corp. is finalizing scope, design and procurementdetails for the generation facility. Once completed, the facilitywill serve demand of Duke Power and other wholesale customers inthe region. The contract with Duke begins June 1, 2000 and runsthrough 2003, with Duke having the option to extend it through2008.

“The development of the Rockingham Power Facility and theservices we’re providing Duke are both examples of Dynegy’scommitment to the continued expansion of our power generation andmarketing portfolio,” said Dynegy Chairman Chuck Watson. “TheRockingham facility strengthens our regional presence and positionsus to better meet the growing demands of the southeastern marketsand the specific needs of Duke and their customers.”

Ted McMeekin, senior vice president of power generation for DukePower, said because the plant will be in Rockingham County it willbe able to deliver reliable power throughout the Duke Power region- especially during the critical demand periods of the summer.

Dynegy Sells Processing

Separately, Dynegy sold its Haynesville, LA, gas processing andfractionation facility and related gas and gas liquids pipelinesystems to Duke Energy Field Services. The sale of thenon-strategic asset continues the rationalization of certain gasprocessing plants acquired from Trident and Chevron, which hasresulted in greater operating efficiencies and lower costs, Dynegysaid.

“In 1996, Dynegy Midstream Services operated 41 plants and hadjoint venture interests in 16 additional plants,” said SteveFurbacher president of Dynegy Midstream Services, previously knownas Warren Petroleum. “With the sale of the Haynesville Plant, thecompany operates 35 facilities and has interests in 12 others. Aswe have reduced the number of operated facilities, we haveincreased plant utilization by 9%, the gas volume processed by 11%and significantly reduced operating expenses.”

The Haynesville processing facilities consist of two processingplants, a lean oil and a cryogenic expanded plant, with thecapacity to process 85 MMcf/d. The facilities are in Claiborne andWebster parishes. The price was not disclosed.

“The acquisition of these facilities is an excellent fit withour existing processing and gathering facilities in Louisiana andallows Duke Energy Field Services to expand its gathering,compression and processing services along the Louisiana/Arkansasstate line. This area continues to experience significant growth indrilling activity,” said Jim Mogg, president of Duke Energy FieldServices.

On April 1, Duke Energy Field Services also began deliveriesinto the Perryville Hub in northern Louisiana through a new4.5-mile pipeline and the addition of 7,500 hp of mainlinecompression. The expansion enables Duke to provide an incremental100 MMcf/d of capacity into the major transmission pipelinesserving the Midwest and Northeast markets.

Joe Fisher, Houston

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