Iberia and Vermilion Parishes and Louisiana Are Expected to Benefit $22 Million in Economic Development from Jefferson Island Storage & Hub Expansion.

ERATH, La. -- Atlanta-based AGL Resources (NYSE: ATG) today announced the proposed expansion of the company's Jefferson Island Storage & Hub (JISH) natural gas salt-dome storage facility in Erath is expected

to bring more than $22 million in new local and state economic development revenues during the construction phase as well as an additional $1 million annually in new property tax revenues once the expansion is fully in service.

According to a report released today, which was prepared for the company by the Center for Business and Economic Research at Louisiana State University (LSU) in Shreveport, Iberia and Vermilion parishes and the state of Louisiana are all expected to benefit during the construction period and throughout the subsequent service life of the expansion.

"Expanding our storage capacity at JISH is expected to benefit the local area and entire state of Louisiana," said David Jewell, vice president of Operations at JISH. "Our proven record of safety, high-deliverability, and capacity at JISH has already provided benefits to local distribution companies - and their end-use residential, commercial and industrial customers -- in Louisiana as well as the local economy, not to mention the nation's natural gas supply network and energy security during the recent hurricanes.

"Located near the Henry Hub, which connects Louisiana producers and end-users to the nation's natural gas pipeline energy infrastructure and is the central pricing point for natural gas futures, JISH does significant business in Louisiana via interconnections with intrastate pipelines to several local distribution companies and to a number of industrial companies," Jewell explained. "Additionally, JISH's header service at the Henry Hub is a key asset to Louisiana producers providing them with storage and transportation services.

"Natural gas salt dome storage is safe and one of the best methods to protect against supply interruptions," added Jewell. "Storage has been, and is expected to continue to be, important during hurricanes, and particularly now that price stability and supplies are important."

Pending approval of state permits requested earlier this year by JISH, drilling is scheduled to begin as soon as possible on three salt-water injection wells. The drilling is the first phase of the expansion project estimated at a cost of up to $160 million, which, when complete, will add two natural gas salt dome storage caverns to the JISH facility.

According to the LSU report, the expected economic development benefits for the parishes and Louisiana include:

--Additional property taxes from land improvements which would ultimately total an estimated $628,000 per year for Iberia and Vermilion parishes combined.

--An estimated $962,000 in sales tax receipts from the materials portion of construction costs to Vermilion Parish and $1.4 million in sales tax receipts to Louisiana during the construction period projected to continue through 2011.

--Receipt of additional ad valorem taxes on the increased natural gas inventory expected to be stored in the new caverns, which will be paid each year to Iberia Parish by the title holder of the stored natural gas. This is projected to be $395,000 annually.

--Additional payments paid to Entergy Louisiana, the local utility powering JISH, estimated to be between $211,000 and $2.6 million per year during the construction period.

--Creation of new temporary jobs in the Iberia/Vermilion area during construction, with an estimated up to 69 direct and indirect temporary jobs when construction is most active, and three permanent jobs when the expansion is in service. Based on the LSU report, those jobs will result in an estimated total payroll of $5.2 million for Iberia and Vermilion construction workers during the construction project. The permanent jobs are anticipated to be in the $50,000 annual salary range and held by Iberia or Vermilion parish existing or new residents.

In keeping with AGL Resources' commitment to safety and a record of customer service that dates back 150 years, construction and operation of JISH and the expansion project will continue to follow "Best Management Practices" as described by the U.S. Army Corps and the Louisiana Department of Environmental Quality.

JISH consists of 16 miles of dual pipelines that provide interchange capabilities for eight large capacity interconnections and two natural gas storage caverns. By providing storage and hub services through direct connection to the Henry Hub via Sabine Pipeline, Texas Gas Transmission, Columbia Gulf Transmission, Sea Robin Pipeline, Tennessee Gas Pipeline, Gulf South Pipeline, NGPL, and CrossTex Energy Pipeline (formerly known as Louisiana Intrastate Gas), the facility helps to provide natural gas supplies to meet the needs of customers in Louisiana and much of the Gulf Coast and Southeast, as well as areas in the Midwest and Northeast.

A copy of the LSU economic development report is available upon request. For more information about AGL Resources, visit www.aglresources.com. To learn more about the proposed JISH expansion, visit www.aglresources.com/jish.

About AGL Resources

AGL Resources (NYSE: ATG), an Atlanta-based energy services holding company, serves 2.2 million customers in six states through its utility subsidiaries - Atlanta Gas Light, Elizabethtown Gas in New Jersey, Virginia Natural Gas, Florida City Gas, Chattanooga Gas, and Elkton Gas in Maryland. Ranked by Forbes as one of the 10 Best Managed Utilities and No. 250 in the Forbes Platinum 400 as well as No. 647 on the Fortune 1000 and No. 40 in the Fortune gas and electric utilities sector in 2006, AGL Resources reported revenue of $2.7 billion and net income of $193 million in 2005. In addition to JISH, in South Louisiana, the company also owns Houston-based Sequent Energy Management, an asset manager serving natural gas wholesale customers throughout the East and Midwest. As a 70 percent owner in the SouthStar partnership, AGL Resources markets natural gas to consumers in Georgia under the Georgia Natural Gas brand. AGL Networks, the company's telecommunications subsidiary, owns and operates fiber optic networks in Atlanta and Phoenix.

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