NATURAL GAS NETWORK TO EXPAND ALONG #2 HIGHWAY

Released on May 18, 1999

SaskEnergy and its transmission subsidiary, TransGas, today announced

a targeted $6.0 million expansion of its natural gas network to the

Anglin Lake, Waskesiu Lake, McPhee Lake and Montreal Lake areas.

Construction on a natural gas pipeline to serve the area will be

completed during the 1999 construction season with engineering design

starting immediately.



"This is an exciting day for SaskEnergy, an exciting day for residents

in these communities and a tribute to the Saskatchewan spirit of

cooperation," Deputy Premier and Crown Investments Corporation

Minister Dwain Lingenfelter said. "This project will create 4,000

person days of new employment in the Prince Albert area and bring the

cost saving benefits of natural gas to up to 600 homes and businesses

in these resort areas."



"This expansion is part of SaskEnergy's strategy in 1999 to invest

$50 million across Saskatchewan to expand services. For customers in

the area, this project will mean annual savings of hundreds of dollars

in their energy costs."



Doug Kelln, Vice President, SaskEnergy Distribution Utility, said the

efforts of the Anglin Lake/La Ronge Natural Gas Committee, headed by

Alice Tataryn, were critical to the success of the project.



"From day one, the committee has focussed on working with us and

working with customers to successfully address the cost issues

involved in serving these areas," Kelln said.



"We're here today because of that commitment, and now our

challenge will be to work together to convince the remaining

customers to take advantage of the benefits of natural gas."



Depending on their location, residents will be able to commit to

natural gas service for an initial down payment of $1,100 to

$1,700, representing 25% of their connection costs. The

remainder can be financed by the customer through SaskEnergy.

Even with financing costs included, customers' total cost for

natural gas service will normally be less than or comparable to

their existing energy source.



"We feel that a great deal of progress has been accomplished as

our committee and SaskEnergy work together. Today's announcement

demonstrates that progress and, as a committee, we are very

excited," said Alice Tataryn, Chairman of the Anglin Lake La

Ronge Gas Committee. "The committee is determined to continue

efforts to increase project area commitment for natural gas

service."



SaskEnergy and the committee will continue to work on the second

phase of the project, the potential expansion of the pipeline to

serve more northerly communities along the #2 highway, including

La Ronge.



"I expect the recent forestry-related announcements to provide

momentum to both Phase 1 and Phase 2 of the project,"

Lingenfelter said. "With the potential additional natural gas

load created by forestry development in La Ronge, the additional

benefits would be dedicated toward reducing customer costs. For

Phase 1 customers who have committed to the project, that would

mean a rebate. "With enough customer sign-up for Phase 2,

construction could begin as early as spring 2000."



The 52-kilometre 6-inch transmission pipeline and 90 kilometres

of distribution pipeline is expected to be in service by fall.

The high-pressure pipeline that supplies the distribution system

in each of the communities will be sized to accommodate the

project expanding to the La Ronge area.



"We've been able to build the longest natural gas distribution

network in North America because we've always found ways to work

with customers to find solutions," said Kelln. "It's the

Saskatchewan way of doing business and it's what has led us to

this important announcement today."



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For more information call:



Doug Kelln

Vice President

Distribution Utility

777-9378