News

AltaGas income trust increases power capacity by 25 megawatts

August 31, 2004


CALGARY--(CCNMatthews - Aug. 31) - AltaGas Income Trust (AltaGas or the 
Trust) (TSE:ALA.UN) announced today it has entered into a contract with Maxim 
Energy Group Ltd. for the right to 25 megawatts of gas fired power peaking 
capacity. The contract requires no capital outlay by AltaGas but instead 
requires AltaGas to pay Maxim monthly variable operating and maintenance 
charges plus a capacity fee. AltaGas retains 100 percent of the ancillary 
service and peaking sales revenues. The contract has a 10 year term 
commencing September 1, 2004 and includes an option at the end of the initial 
term to extend the term for a further 15 years or purchase the assets.

The 25 megawatts of power is generated by four gas fired peaking plants 
located in southern Alberta. AltaGas' total power portfolio now consists of 
478 megawatts of power generation representing approximately 6 percent of the 
Alberta power market as of June, 2004.

The addition of the 25 megawatts of natural gas generation capacity provides 
fuel diversity to AltaGas' coal fired generation. It adds a fifth independent 
supply source, reducing any potential risk on the Trust's overall power 
supply portfolio. Operationally, given the speed at which the power assets 
can be ramped up, the peaking supply easily provides backstopping to AltaGas' 
Sundance B Power Purchase Arrangement and Genesee energy contract. The 
peaking gas requirement will be managed by the gas services component of 
AltaGas.

AltaGas does not engage in speculative trading of power. The Trust manages 
its acquired power capacity to provide stable, predictable earnings and cash 
flow over time. AltaGas reduces its exposure to floating electricity prices 
by supplying internal electrical demand requirements and by using a balanced 
portfolio of contracts to lock in power margins to reduce pricing risk.

AltaGas moves energy from its source to the end user, adding value through 
the process. The Trust has consolidated assets totalling over $950 million 
and a market capitalization of approximately $1 billion. 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.

When used in this news 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