PG&E Gas Transmission Northwest closes on 10-year $100 million financing

BETHESDA, Md., June 14, 2002 — PG&E National Energy Group, a unit of PG&E Corp., recently announced that its natural gas pipeline subsidiary, PG&E Gas Transmission Northwest Corporation (GTN), closed on a 10-year $100 million private placement debt financing.

The 6.62 percent notes were priced at 1.55 percent over the 10-year Treasury yield. Proceeds from the financing were used to pay down a bank revolving credit facility and the balance will be used for general working capital needs.

“This financing indicates the strong credit quality of our pipeline assets,” said John Cooper, PG&E National Energy Group’s senior vice president of finance. “We’re pleased with the due diligence and understanding of our pipeline business that our lenders exhibited, resulting in an attractively priced financing.”

The Royal Bank of Scotland plc and Fleet Securities, Inc. were co- placement agents on the financing, which was increased from $75 million in order to meet market demand. Affiliates of four insurance companies purchased the notes.

GTN consists of more than 1,350 miles of natural gas transmission pipeline with a capacity of approximately 2.7 billion cubic feet of natural gas per day. Beginning at the British Columbia/Idaho border, it extends 612 miles through northern Idaho, southeastern Washington and central Oregon to the Oregon/California border where it connects with other pipelines.

It is the largest transporter of Canadian natural gas into the United States and is the only pipeline directly linking the natural gas reserves in western Canada to the gas markets of California and parts of the Pacific Northwest.

Headquartered in Bethesda, Md., PG&E National Energy Group develops, builds, owns and operates electric generating and natural gas pipeline facilities and provides energy trading, marketing and risk-management services.

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