AEP Resources to Acquire Midstream Natural Gas Assets from Equitable Resources

Sept. 14, 1998•News Release

COLUMBUS, Ohio, Sept. 14, 1998 -- AEP Resources Inc., a subsidiary of American Electric Power (NYSE: AEP), has been selected to acquire the midstream natural gas operations of Equitable Resources Inc. (NYSE: EQT) which are located in Louisiana and Texas. The transaction, valued at $320 million, is expected to close before the end of 1998 after the receipt of certain regulatory approvals. Equitable Resources announced in March its intent to sell the midstream operations and accepted bids Aug. 31. The midstream operations include a fully integrated natural gas gathering, processing and storage operation in Louisiana and an energy trading and marketing business based in Houston. Assets include Louisiana Intrastate Gas, a 2,000 mile intrastate pipeline system; four natural gas processing plants that straddle the pipeline, plus a fifth plant currently under construction; Jefferson Island Storage facilities which include an existing salt dome storage cavern and a second cavern under construction which are directly connected to the Henry Hub. The pipeline is interconnected to 12 interstate pipelines running to the major consumption markets in the Northeast, Midwest and Southeast. "With this acquisition, we move ever closer to the reality of our slogan, AEP: America's Energy Partner(sm)," said Donald M. Clements, president of AEP Resources. "This purchase meshes perfectly with our recent initiatives to trade energy in a significant way and to continue to grow our portfolio of energy-related companies and services. "We consider this a strategic move that will enhance future opportunities for AEP Energy Services," Clements said. "The assets will be beneficial to AEP Energy Services, already one of the nation's leading energy traders, as it continues to build its business." "These assets complement our existing electric and natural gas trading and optimization capabilities," said Paul Addis, president of AEP Energy Services. "The acquisition provides AEP a set of natural gas assets directly tributary to the largest source of the United States' onshore and offshore natural gas supply. "AEP is simultaneously focused on building a portfolio of strategically located energy assets (fuel, transportation, storage, processing and electric generation) with a first-rate trading and commercial optimization organization to manage the price volatility and geographic and time arbitrage inherent to these energy assets and the energy production chain," Addis said. "We believe the Equitable midstream natural gas assets are a perfect complement to our portfolio of assets." AEP Resources, a wholly owned subsidiary of AEP, pursues energy-related domestic and international investment opportunities and projects. The company has offices in Columbus, Ohio; London; Singapore; Toronto; Beijing; and Sydney, Australia. AEP Energy Services, another AEP subsidiary, markets and trades energy commodities and provides related services. AEP Energy Services has offices in Columbus and Houston. AEP, a global energy company, is one of the United States' largest investor-owned utilities, providing energy to 3 million customers in Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and West Virginia. AEP has holdings in the United States, the United Kingdom, China and Australia. Wholly owned subsidiaries provide power engineering, energy consulting and energy management services around the world. The company is based in Columbus, Ohio. On Dec. 22, 1997, AEP announced a definitive merger agreement for a tax-free, stock-for-stock transaction with Central and South West Corp., a public utility holding company based in Dallas.

For More Information, Contact: Media: Pat D. Hemlepp Manager, Media Relations 614/223-1620 Analysts: John S. Bilacic Manager, Investor Relations 614/223-2847

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