"This cogeneration facility will be the largest industrial energy project in Indiana," said Joseph L. Turner Jr., president of Primary Energy. "Because of the high level of efficiency, coupled with the use of clean-burning natural gas and advanced environmental technologies, this venture also will support Whiting refinery's and NiSource's commitment to a clean environment."

The plant, to be built on BP Amoco's property, will generate 525 megawatts of power and substantial steam production. The project cost is estimated at approximately $250 million and construction is scheduled to begin this year, with completion planned for the second quarter of 2001.

"This project is consistent with our aim to make the Whiting refinery globally fit and competitive long into the future," said Colin Maclean, Business Unit leader, Whiting Refinery. "The cogeneration of power and steam is aligned with BP Amoco's leadership in reducing greenhouse gases."

Primary Energy will be responsible for the operation and maintenance of the cogeneration project and related equipment. "This agreement represents another industrial initiative that plays a critical role in the NiSource strategy to expand clean power technologies without building significant new infrastructure," said Gary L. Neale, NiSource chairman, president and chief executive officer. "This state-of-the-art cogeneration facility enhances each company's competitive position by allowing BP-Amoco and NiSource to concentrate on our core businesses."

Primary Energy is the leading developer of industrial energy projects in the United States in terms of megawatt capacity and dollar value investment. "The existing electric capacity that will be freed up will be utilized by Northern Indiana Public Service Company's (NIPSCO's) growing customer base throughout northern Indiana and by the wholesale market in the Midwest," Neale said.

The partnership between Primary Energy and BP Amoco will become the sixth major project initiated by Primary Energy. The energy development company is actively pursuing several other project agreements, some of which it expects to complete later this year. Additional facilities previously developed by Primary Energy include:

• Portside Energy, Inc., a cogeneration plant that supplies electric power, steam and hot, softened water to National Steel's Midwest Steel Division in Portage, Ind.;
• Lakeside Energy, Inc., which utilizes byproduct fuels from U.S. Steel's operations at Gary Works in Gary, Ind., to produce electricity and process steam for Gary Works' exclusive use;
• North Lake Energy, Inc., a steam turbine cogeneration plant at Ispat Inland Inc.'s Indiana Harbor Works in East Chicago, Ind.;
• A pulverized coal injection facility operated in a joint venture with Ispat Inland Inc. at its Indiana Harbor Works, and
• Cokenergy, which began operating in summer 1998 at Ispat Inland's Indiana Harbor Works in conjunction with their nonrecovery coke plant. This facility captures waste heat to generate electricity, and processes steam for Ispat Inland's exclusive use.

Primary Energy, Inc. a wholly owned subsidiary of NiSource, invests in and manages projects that optimize energy productivity, while reducing operating costs for large, energy-intensive industrial and commercial complexes. Primary Energy specializes in on-site electric and steam-generating facilities, and acts with strong customer focus to assure its customers' objectives are being met. Target markets include the steel, refining, chemical, food products, and pulp and paper industries in North America. Information about Primary Energy is available via the Internet at www.primaryenergy.com.

NiSource Inc. is a holding company with a market capitalization of approximately $3.6 billion whose primary business is the distribution of electricity, natural gas and water in the Midwest and Northeast United States. The company also markets utility services and customer-focused resource solutions along a corridor stretching from Texas to Maine. Further information may be accessed on the Internet at www.nisource.com.