Gas News Release

October 1, 1999

Consolidated Natural Gas’s Critical Systems Ready To Deliver Natural Gas in Year 2000

“We’ve worked long, hard and systematically to test our natural gas delivery system and update it for the year 2000,” said George A. Davidson, Jr., CNG chairman and chief executive officer. “We are confident we can deliver natural gas and continue to provide quality service as we begin the year 2000.”

CNG’s four natural gas distribution companies serve 1.9 million customers. The East Ohio Gas Company, headquartered in Cleveland, serves nearly 1.2 million customers in Ohio; The Peoples Natural Gas Company, headquartered in Pittsburgh, serves 349,000 customers in western Pennsylvania; Virginia Natural Gas, Inc., headquartered in Norfolk, serves 223,000 customers in southeastern Virginia; and Hope Gas, Inc., headquartered in Clarksburg, W.Va., serves 116,000 customers in West Virginia. CNG Transmission Corporation, headquartered in Clarksburg, W.Va., operates an interstate natural gas transmission and storage system that serves the Northeast, Mid-Atlantic and Midwest. CNG Producing Company, headquartered in New Orleans, explores for and produces oil and natural gas in the Gulf of Mexico, the Appalachian region and various other locations in the U.S. and Canada.

“Our natural gas delivery system can be operated manually, if necessary,” said Gary Deschamps, vice president of system services. “Many of our process control components are not automated or date-sensitive, and therefore not susceptible to the Y2K problem.”

In August, CNG held a Y2K simulation at 80 critical storage, transmission and distribution facilities and verified that it could operate its gas delivery system manually in case of computer failure. Rehearsals of backup plans for other elements of CNG’s operations and business systems will take place in the next few weeks.

CNG is also making capital improvements to its system. Electric generators are being added or improved so that CNG can generate its own power if it is needed to run critical gas delivery systems. Generators can also provide power to CNG’s microwave telecommunications system, and CNG will have radios and satellite communication systems as additional communications backups.

“CNG already had extensive contingency plans and, by revisiting those plans in the context of the Y2K scenario, we are now more prepared than ever for emergencies,” Deschamps said. “We will continue to work with suppliers, electric utilities, telecommunications providers and other vital partners to fine-tune our backup plans.”

CNG’s program has included testing and remediation of its software and hardware systems, as well as special communications with its customers, employees, suppliers and regulatory agencies. CNG’s Y2K effort involved hundreds of employees, including 30 full-time employees and consultants. The company currently expects to spend about $16 million on the project, which is under its budget of $20.1 million.

“Our employees responded well to a unique challenge,” Deschamps said. “We had to review all of our operations in a different way, and figure out how to fix or work around potential computer problems.”

Even though the company expects no Year 2000-related disruptions of service, Deschamps said CNG will have extra personnel on duty during the date changeover in case problems arise.

“We routinely encounter service calls during the middle of winter because of weather conditions and the strain a heavy load puts on our system,” Deschamps said. “We will be prepared for that, as well as for the possibility of Y2K problems encountered by our business partners and suppliers.”

The Year 2000 problem, also called the “millennium bug,” is a result of the inability of some computer and software systems to read dates beginning in the year 2000. Many computers may malfunction or shut down if the date problem is not resolved.

The Year 2000 statements made in this news release are intended to serve as Year 2000 Readiness Disclosures within the meaning of the Year 2000 Information and Readiness Disclosure Act.

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For further information contact:
Dan Donovan
412-690-1370