Agreement Reached to Continue Operations of Grande Cache Power Station

Wednesday, January 3, 2001

Calgary, Alberta – ATCO and the Alberta Balancing Pool Administrator announced today that they have reached an agreement with customer groups that will allow the H.R. Milner 144 MW coal-fired electricity generation station at Grande Cache to continue operating. This follows an agreement reached recently with Luscar Ltd. to supply coal to the station. The continued operation of the station will help meet Alberta's power requirements through the current period of tight supply.

The continued operation of the 144 megawatt H.R. Milner station was brought into doubt earlier this year when the previous coal supplier went into bankruptcy. The station was not part of the government auction of regulated power generation because of the uncertainty of the coal supply.

The agreements give the Alberta Balancing Pool Administrator control of the station effective January 1, 2001, and the right to sell it in the future. In return, ATCO is paid the net book value of the station. ATCO will operate the station on a cost of service basis on behalf of the Balancing Pool. The Alberta Balancing Pool was set up by the Alberta government as part of the deregulation process to distribute the surplus revenue from the sale of the regulated power plants through the Power Purchase Arrangements.

ATCO operates two other coal-fired generating stations in Alberta with a capacity of over 1400 MW and is a world leader in the development of environmentally progressive cogeneration facilities. In Alberta, ATCO Power has recently built or has under construction with partners, six independent power plants capable of generating sufficient new electricity to supply 750,000 households. The plants are located at Primrose, Poplar Hill, Joffre, Rainbow Lake, Scotford, and Muskeg River.

ATCO Group is an Alberta-based corporation with a worldwide organization of companies and more than 6000 employees engaged in Power Generation, Utilities, Logistics and Energy Services, Industrials and Technologies. More information about ATCO can be found on its website, www.ATCO.com.

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