Connecticut Energy and Duke Energy Subsidiaries to Bring Natural Gas to New Electric Generating Facility in Bridgeport, CT.

BRIDGEPORT, Conn.--(BUSINESS WIRE)--Sept. 24, 1997--Connecticut Energy Corp. (CNE-NYSE) announced today that its subsidiary, The Southern Connecticut Gas Co. (Southern), will construct, own and manage the distribution facilities needed to transport up to 187,000 dekatherms per day of natural gas to a new electric generating plant located at the Bridgeport Harbor Station, Bridgeport, Connecticut. When completed, the 520 megawatt gas turbine plant will be the largest nonnuclear generating plant in the state and will provide enough electricity to serve up to 260,000 homes.

In an initial agreement signed by Southern and Duke Energy Trading and Marketing, LLC, Southern will construct a high pressure natural gas distribution line from a gas metering station in Stratford, Connecticut, to the Bridgeport Harbor Station facility which is owned by United Illuminating. Duke Energy Trading and Marketing is a subsidiary of Duke Energy Corp. The electric generating plant is expected to begin operation in mid-1998.

"Construction of the new Bridgeport Harbor plant as primarily a natural gas burning facility is a win, win situation for all," said Carol A. Forest, vice president finance, chief financial officer and treasurer of Connecticut Energy Corp., "and we are very excited about the tremendous opportunities it presents. This project, when completed, will significantly enhance Connecticut Energy's ability to accelerate margin and earnings growth. The initial agreement also allows the potential participation by other subsidiaries of both Duke Energy Corp. and Connecticut Energy Corp.

"The 20-year agreement calls for Southern to provide firm transportation service, with initial deliveries of 83,000 dekatherms per day of natural gas," added Forest. "With gas transported at this initial level, the firm contract represents significant new margins to the company over the life of the contract. If transportation volumes grow to the anticipated 187,000 dekatherms per day, incremental margin growth would increase even further." Although the plant is designed to have dual fuel capability, natural gas was chosen as the primary fuel because of its clean burning capabilities and stability of supply and price. The secondary fuel, low sulfur fuel oil number 2, will be used only as a back-up fuel.

The electric generating facility will be constructed to help meet Connecticut's current and future energy needs and it will be owned by Bridgeport Energy LLC, whose members are affiliates of Duke Energy Corporation and United Illuminating.

Connecticut Energy Corp. is a holding company primarily engaged in the retail distribution of natural gas through Southern, its principal subsidiary. Southern delivers natural gas in 22 Connecticut communities to more than 170,000 customers and households. Through its subsidiary, CNE Energy Services Group Inc., the company also provides an array of energy products and services to commercial and industrial customers throughout New England. The company also participates in a natural gas purchasing cooperative through another subsidiary, CNE Development Corp., and has formed a third unregulated subsidiary, CNE Venture-Tech Inc., which focuses on investing in technology companies and participating in ventures with technology partners serving the utility industry.

CONTACT: Connecticut Energy Corp.

Romilda R. Anderson, 203/382-8245

Judith E. Falango, 203/382-8156