News

AltaGas Income Trust Announces Trust Unit Offering

May 27, 2004


/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER U.S. WIRE SERVICES/

CALGARY--(CCNMatthews - May 27) - AltaGas Income Trust ("AltaGas") 
(TSX:ALA.UN) announced today that it has filed a preliminary short form 
prospectus with the securities commissions in each of the provinces of Canada 
with respect to the issue of Trust Units. AltaGas intends to raise 
approximately $75 million from the offering which is anticipated to close 
during the week of June 7, 2004. The syndicate of Underwriters is lead by RBC 
Capital Markets and Clarus Securities Inc., and includes BMO Nesbitt Burns 
Inc., Scotia Capital Inc., CIBC World Markets Inc., National Bank Financial 
Inc., Canaccord Capital Corporation and Peters & Co. Limited. AltaGas has 
also granted the Underwriters an over-allotment option to purchase up to an 
additional 10 percent of the issue, exercisable, in whole or in part, within 
30 days following the date of closing.

The net proceeds attributable to the sale of Trust Units will be used to 
reduce bank indebtedness, which may be redrawn and used for general corporate 
purposes including AltaGas' ongoing capital program, the funding of the 
Edmonton Ethane Extraction Plant acquisition announced on March 18, 2004 and 
future acquisitions.

Commenting on the offering, David W. Cornhill, Chairman and Chief Executive 
Officer of AltaGas Ltd., administrator of AltaGas, said, "This unit offering, 
our first since our conversion into an income trust on May 1, 2004, will 
reduce our debt to total capitalization ratio to within our new target range 
of 45 to 50 percent. With a considerably stronger balance sheet and 
predictable, long term cash flows generated by our diversified asset base we 
will continue to be positioned to take advantage of attractive investment 
opportunities as they arise."

AltaGas Income Trust will commence monthly distributions on June 15, 2004 to 
holders of Trust Units and Exchangeable Securities of record on May 25, 2004. 
The amount of the distribution on that date will be $0.15 for each Trust Unit 
and each Exchangeable Security. It is expected that purchasers of Trust Units 
under this offering will be eligible to receive the anticipated July 15, 2004 
distribution.

Enbridge Inc. (Enbridge) is not participating in this offering of Trust 
Units. Upon completion of the offering Enbridge is expected to hold a fully 
diluted ownership interest of approximately 36 percent.

AltaGas announced yesterday that it has executed a letter of intent to 
purchase the business of PremStar Energy Canada Ltd. and its subsidiaries 
ECNG Inc. and Energistics Group Inc. for approximately $22.0 million payable 
by way of 993,789 Trust Units issued from AltaGas Income Trust treasury plus 
approximately $1.2 million cash. The transaction is conditional on the 
execution of a purchase and sale agreement, which is expected to occur prior 
to July 1, 2004.

AltaGas moves energy from its source to the end user, adding value through 
the process. The Trust has assets totaling almost $950 million and a market 
capitalization of approximately $900 million. Its steadily expanding asset 
base today includes natural gas gathering and processing facilities, 
interests in ethane and natural gas liquids extraction plants, and 
transmission pipelines. AltaGas distributes natural gas to Alberta customers 
through AltaGas Utilities Inc., to customers in the Northwest Territories 
through the Ikhil Gas Project and distributes gas in Nova Scotia through its 
interest in Heritage Gas Limited. The Trust provides energy services to 
customers, including marketing of natural gas and natural gas liquids and 
sale of power from its power purchase based arrangements.

AltaGas' Trust Units are listed on the Toronto Stock Exchange under the 
symbol ALA.UN. The Trust is included in the S&P/TSX Capped Income Trust Index 
and the S&P/TSX Capped Energy Trust Index.

This news release does not constitute an offer to sell securities, nor is it 
a solicitation of an offer to buy securities, in any jurisdiction. All sales 
will be made through registered securities dealers in jurisdictions where the 
offering has been qualified for distribution. The Trust Units offered are 
not, and will not be, registered under the securities laws of the United 
States of America, nor any State thereof and may not be sold in the United 
States of America absent registration in the United States or the 
availability of an exemption from such registration.

When used in this press release, the words "anticipate", "estimate", and 
similar expressions are intended to identify forward-looking statements. Such 
statements are subject to certain risks, uncertainties and assumptions that 
could cause actual results to differ materially from those contemplated in 
the forward looking statements. These risks and uncertainties include 
operating performance, regulatory and environmental issues, weather and 
economic conditions, competition and financing availability. For additional 
information on these and other factors see the reports filed by AltaGas with 
Canadian securities regulators. AltaGas disclaims any intention or obligation 
to update or revise any forward looking information whether as a result of 
new information or future event.

 


Media:
Dennis Dawson
(403) 691-7534
Email: dennis_dawson@altagas.ca


or


Investment Community:
Marilyn Pfaefflin
(403) 691-7540
Email: marilyn_pfaefflin@altagas.ca
Website: www.altagas.ca