Williams awarded bid to supply 2,000 MW in New Jersey

TULSA, Okla., Feb. 19, 2002 — Williams has been awarded a one-year, fixed-price supply agreement to provide 2,000 megawatts (MW) of power to certain New Jersey electric distribution companies (EDCs) beginning Aug. 1. Financial terms of the agreement were not disclosed.

“Williams is proud to be a solid business partner in this cooperative effort of public utilities, regulatory agencies and private business to meet the power needs of New Jersey,” said Bill Hobbs, president and chief executive officer of Williams’ energy marketing and trading business unit. “We look forward to working with all of the entities to provide price stability and reliable energy to the customers of New Jersey.”

Williams was awarded the contract through the 2002 New Jersey Basic Generation Service auction which was authorized by the New Jersey Board of Public Utilities to serve customers through New Jersey’s four EDCs: Public Service Electric and Gas Company, GPU Energy, Conectiv Power Delivery and Rockland Electric Company. The total load for all EDCs in the Basic Generation Service auction was approximately 18,000 MW.

“This agreement with New Jersey EDCs fits well with Williams current power portfolio and planned growth in the Pennsylvania, New Jersey and Maryland (PJM) market,” Hobbs said.

Williams owns and operates a 170 MW peaking generation unit in Hazleton, Pa. Additionally Williams has tolling agreements with the newly constructed AES Ironwood power generating facility in South Lebanon Township, Pa., and AES Red Oak power generating facility under construction and scheduled for completion this year in Sayreville, N.J.

These facilities add more than 1,500 MW of generation capacity and, along with other power purchase agreements in the Williams portfolio, will help to serve the New Jersey power commitment. Williams also provides power support to Allegheny Electric Cooperative, which serves members in the Pennsylvania and New Jersey area.

“Williams believes this is a successful program and is a valuable process for all involved to meet the power needs of this area. We welcome the opportunity to participate in long-term agreements through this process in the future,” Hobbs said.

Williams’ energy marketing and trading unit buys and sells all types of energy products nationwide including natural gas and gas liquids, crude oil and refined products and electricity. The unit also manages its customers’ exposure to volatile energy prices using comprehensive risk management services and creates customized energy financing solutions for producers and end-users. Utilizing sophisticated risk-management tools, Williams has pioneered structured solutions such as long-term tolling arrangements and full-requirements transactions.

About Williams

Williams, through its subsidiaries, connects businesses to energy. Williams information is available at www.williams.com .

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