Aquila Energy Awarded $24.3 Million Contract by Nebraska's Energy America.

KANSAS CITY, Mo.--(BUSINESS WIRE)--March 31, 1998--Aquila Energy, a subsidiary of UtiliCorp United (NYSE:UCU), has been awarded a long-term contract to supply natural gas to Energy America.

Under the $24.3 million contract Aquila will supply Energy America with 14,419,850 MMBtu of natural gas over a 10-year period.

Energy America, based in Lincoln, Neb., is affiliated with the Nebraska Municipal Power Pool, the Municipal Energy Agency of Nebraska and the Nebraska Public Gas Agency. Energy America will resell the natural gas obtained from Aquila to the municipal organizations that comprise the Nebraska Public Gas Agency.

Energy America is prepaying the entire contract. It has issued tax-free bonds while interest rates are low to provide its member customers with lower cost energy over the length of the contract.

"Energy America is pleased to be able to finalize this supply contact with Aquila Energy," says Roger W. Mock, president of Energy America.

"This method of purchase coupled with tax-exempt financing over the next 10 years will allow us to provide Nebraska Public Gas Agency members with a stable gas supply for a portion of their needs at a guaranteed discount price."

Aquila is making this type of unique financial arrangement available to its customers so they can take advantage of the low interest rates currently available in the marketplace. Aquila is able to offer such long term contracts because of its established risk management and trading activities. Aquila is currently the nation's fifth largest wholesale marketer of natural gas and the sixth largest wholesale marketer of electric power.

In addition to the long-term contract with Energy America, Aquila recently was awarded a 10-year contract by the Municipal Gas Authority of Georgia (MGAG) for $125 million. Under the terms of this contract Aquila is supplying MGAG with 20,000 MMBtu a day of natural gas. As Energy America is doing, MGAG prepaid the entire contract.

"Our strategy always has been to improve our customers' ability to manage their energy supplies," says Tom McCarthy, Aquila vice president and general manager for Energy Services. "We do that by using our flexibility to marry our sophisticated financial skills at Aquila with the needs of the customer."

Aquila is based in Omaha, Neb., and is a subsidiary of UtiliCorp United, a Kansas City-based international electric and gas company with energy customers and operations across the U.S. and in Canada, Great Britain, New Zealand, and Australia. UtiliCorp has assets of $5.1 billion and its 1997 sales were $8.9 billion.

CONTACT: UtiliCorp United, Kansas City

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