[2] Knife River Corporation Acquires A-1 Paving.

Business Editors

BISMARCK, N.D.--(BUSINESS WIRE)--Oct. 31, 2000

A-1 Paving, Inc., a construction company headquartered in Kalispell, Montana, was acquired today by Knife River Corporation, the construction materials and mining subsidiary of MDU Resources Group, Inc. (NYSE:MDU). The acquisition is expected to be accretive to the earnings per share of MDU Resources. Other financial details were not disclosed.

A-1 Paving produces aggregate materials, asphalt and provides construction services in the Flathead Valley region of northwestern Montana. In addition, the company operates a highway construction division that performs grading and asphalt paving services on state and federally funded projects throughout a 30 county region in western and central Montana. A-1 Paving's operations will be under the direction of Kevin Mohl, vice president and general manager.

"This acquisition provides an opportunity for our construction materials operations to expand into the attractive Flathead Valley market," stated Terry Hildestad, president and chief executive officer of Knife River Corporation. "A-1 Paving meets all of our acquisition criteria. It is a quality construction company with a respected leadership team. We are excited to have them join our company."

The Flathead Valley has a population of approximately 73,000 permanent residents. Kalispell is the largest city and serves as a regional trade center. A-1 Paving has grown steadily since it was founded by Arnie and Kevin Mohl in 1986. The company's annual revenues reached $23 million in 1999.

Knife River Corporation mines and markets aggregates and related value-added construction materials products and services in the western United States including Alaska and Hawaii. The company also operates lignite coal mines in Montana and North Dakota. Knife River is a subsidiary of MDU Resources Group, Inc., a multidimensional natural resource enterprise traded on the New York Stock Exchange as "MDU."

The information in this release includes certain forward-looking statements, including statements concerning accretive earnings per share and statements made by the president and chief executive officer of Knife River Corporation, within the meaning of Section 21E of the Securities Exchange Act of 1934. Although the company believes that its expectations are based on reasonable assumptions, actual results may differ materially. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the effects of competition, the level of government expenditures on public projects and project schedules, weather conditions, spending and the ability to effectively integrate the acquired operations. For a discussion of other important factors refer to the company's 1999 Annual Report on Form 10-K at Item 7 -- Management's Discussion and Analysis -- Safe Harbor for Forward-looking Statements and the company's most recent Form 10-Q at Item 2 -- Management's Discussion and Analysis -- Safe Harbor for Forward-looking Statements.