Deb McDonald Reveals a Little Bit of NGPL's Strategy in Interview ,
 NGPL Recontracts with NIPSCO

Natural Gas Pipeline Company of America (NGPL) continues to move through the 
recontracting 
process like a hot knife through butter. Since Kinder Morgan took over NGPL 
parent KN Energy 
last year, the interstate pipeline subsidiary has signed multiple agreements 
and contract 
extensions for gas transportation and storage with its major shippers in the 
Midwest, including 
another deal announced yesterday with Northern Indiana Public Service 
(NIPSCO). 

NGPL and NIPSCO signed a contract extending the terms of several firm 
transportation 
agreements totaling 295,100 MMBtu/d of capacity beginning Dec. 1, 2000 and 
Dec. 1, 2001 
and continuing through Nov. 30, 2002. They also extended the terms of two 
storage agreements 
totaling 10.5 Bcf of capacity beginning Dec. 1, 2000 and April 1, 2001 and 
continuing through 
March 31, 2003. NIPSCO, a NiSource subsidiary, is a regulated utility that 
provides natural gas 
o nearly 700,000 customers and electricity to 416,000 customers across the 
northern third of Indiana. 

"Virtually all of our operationally available capacity is sold out now until 
the fourth quarter of this 
year," said NGPL President Deborah Mcdonald in an interview. 

"Basically about a third of the transportation contracts and a third of the 
storage contracts are 
up for renewal every year. We've been very successful in our efforts 
resigning our three major 
customers [NiGas, NIPSCO and Peoples]." Despite increasing competitive 
pressure from 
Northern Border and Alliance Pipeline, the pipeline also has had surprising 
luck signing 
agreements with marketers and power generators. 

"In contrast to the traditional market of long-haul transportation from the 
Midcontinent and 
Louisiana to Chicago, we have been extending our horizons trying to find a 
new market in 
the marketers rather than the core LDCs. Obviously the contract that we 
signed earlier this
year with Aquila Energy for 500,000 MMBtu of transportation capacity has also 
really helped 
us be successful in our recontracting efforts," Mcdonald said. 

"We also have developed a number of new rate services for gas-fired power 
generators. 
Growth in NGPL will come from natural gas-fired generation. You probably saw 
our press 
release about the Ameren contracts for [construction of 1,700 MW of 
generation along the
NGPL system]. In the aggregate we think we are on target to connect over 
3,000 MW of 
gas-fired generation this year and over 3,000 MW next year as well [which 
would represent 
up to 900 MMcf/d in gas transportation capacity]. 

"Obviously another challenge is going to be [the 1.325 Bcf/d] Alliance 
Pipeline coming into 
the market this fall. It's anyone's guess whether that will really fill up in 
a short period of time. 
I think a lot of that will be coming into Chicago and moving back out on 
Vector. But we're 
ready at Hub America to kind of serve as a giant header system [with Texas 
Eastern as 
an eastbound partner]." 

Mcdonald was not prepared, however, to announce the results of a recent open 
season 
for about 100 MMcf/d of capacity that will be available through a new 
interconnection between 
NGPL and Tetco for eastbound transportation.
bill.cordes@enron.com, julie.mccoy@enron.com, steve.klimesh@enron.com, 