Fitch Ratings Downgrades Cornerstone Propane Partners, L.P. To 'D'.

Business Editors

NEW YORK--(BUSINESS WIRE)--Aug. 6, 2002

Fitch Ratings has downgraded Cornerstone Propane Partners, L.P.'s (CNO) outstanding $45 million senior notes to 'D' from 'C' and Cornerstone Propane, L.P.'s (CPLP) outstanding $365 million senior secured notes to 'DD' from 'C'. NorthWestern Corp. (NOR; 'BBB+' senior unsecured debt rating, Rating Watch Negative by Fitch) controls approximately 30% of the equity interest of CNO though its subordinated unit and 2% general partner interest. CNO in turn is a retail propane master limited partnership for CPLP, an operating limited partnership.

The rating action follows the announcement on Aug. 5, 2002 that the partnership has elected not to make the approximate $5.6 million interest payment on three tranches of CPLP's outstanding senior secured notes which was due on July 31, 2002. In addition, the partnership has announced that it is continuing to review its financial and strategic options, including the commencement of a Chapter 11 case under the U.S. Bankruptcy Code.

While expected recovery values are highly speculative and cannot be estimated with any precision, a 'DD' rating for CPLP indicates potential recoveries in the range of 50% to 90%, while a 'D' rating for CNO indicates a recovery level below 50%. For the last 12 month period ended March 31, 2002, a period marked by significantly warmer than normal winter weather, CPLP's acquisition adjusted EBITDA approximated $62.8 million. Utilizing a distressed multiple of 4.0 times (x) (normalized industry multiples have often exceeded 6.0x), the partnership's current enterprise value can be conservatively estimated at about $250 million. It is Fitch's understanding that the partnership has $17.7 million of borrowings and $8.3 million of letters of credit outstanding under a $50 million credit facility guaranteed by Northwestern Corp.