Exhibit 99.1
NEWS
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KeySpan Corporation For Immediate Release
Contacts: Investors Media Relations
George Laskaris Andrea Staub
718.403.2526 516.545.5052
516.824.1241 (pager)
KeySpan Completes Exchange With Houston Exploration
Exchange Valued at $449 Million
Reduces Ownership Interest to 24%
New York, June 2, 2004 - KeySpan today announced the successful completion of an
exchange transaction with The Houston Exploration Company (NYSE: THX) valued at
$449 million, which reduced KeySpan's ownership of Houston Exploration from
approximately 55% to 24%.
Under the terms of the transaction, KeySpan exchanged 10.8 million shares of
Houston Exploration common stock for all the stock of Seneca-Upshur Petroleum,
Inc., a wholly owned subsidiary of Houston Exploration. Houston Exploration
retired 4.6 million shares and issued 6.2 million shares in a public offering.
Based on the Houston Exploration announced offering price of $48.00 per share,
KeySpan's Seneca-Upshur's shares were valued at the equivalent of $449 million,
or $41.57 per share. Seneca-Upshur's assets consist of Appalachian producing
properties valued at $60.0 million dollars, and $389.0 million in cash.
Seneca-Upshur's proven reserves of 50.5 billion cubic feet of natural gas
equivalent (Bcfe) represent approximately 7% of Houston Exploration's proved
reserves.
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A member of the Standard & Poor's 500 Index, KeySpan Corporation (NYSE:KSE) is
the fifth largest distributor of natural gas in the United States and the
largest in the Northeast, operating regulated gas utilities in New York,
Massachusetts and New Hampshire, serving 2.5 million customers. These
customer-focused businesses are complemented by a portfolio of service companies
which offer energy-related products, services and solutions to homes and
businesses. KeySpan is also the largest electric generator in New York State. We
own approximately 6,600 megawatts of generating capacity, providing power to 1.1
million customers of the Long Island Power Authority on Long Island and
supplying approximately 25 percent of New York City's capacity needs. In
addition to these assets, KeySpan has strategic investments in natural gas
exploration, production, pipeline transportation, distribution and storage, and
Canadian gas processing. KeySpan has headquarters in Brooklyn, New England and
Long Island. For more information, visit KeySpan's web site at
www.keyspanenergy.com.
Certain statements contained herein are forward-looking statements, which
reflect numerous assumptions and estimates and involve a number of risks and
uncertainties. For these statements, we claim the protection of the safe harbor
for forward-looking statements provided by the Private Securities Litigation
Reform Act of 1995. There are possible developments that could cause our actual
results to differ materially from those forecast or implied in the
forward-looking statements. You are cautioned not to place undue reliance on
these forward-looking statements, which are current only as of the date of this
filing. We disclaim any intention or obligation to update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. Among the factors that could cause actual results to differ
materially are: general economic conditions, especially in the Northeast United
States; available sources and costs of fuel; volatility of energy prices in a
deregulated market environment as well as in the source of natural gas and fuel
used to generate electricity; potential write-down of our investment in natural
gas properties when natural gas prices are depressed or if we have significant
downward revisions in our estimated proved gas reserves; federal and state
regulatory initiatives that increase competition, threaten cost and investment
recovery and impact rate structure; our ability to successfully reduce our cost
structures; implementation of new accounting standards; the degree to which we
develop unregulated business ventures, as well as federal and state regulatory
policies affecting our ability to retain and operate those business ventures;
our ability to identify and make complementary acquisitions, as well as the
successful integration of those acquisitions; inflationary trends and interest
rates; and risks detailed from time to time in reports and other documents filed
by us with the Securities and Exchange Commission.
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