Duke Energy Canada Exchangeco Inc.

November 17, 2006 17:01 ET

Duke Energy Canada Exchangeco Inc. to Convene Special Meeting of Exchangeable Shareholders to Consider Proposed Reorganization

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 17, 2006) - Duke Energy Canada Exchangeco Inc. (TSX:DX) (Exchangeco) announced today it will convene a special meeting of the holders of its exchangeable shares to consider a share capital reorganization in connection with the planned separation by Duke Energy Corporation (Duke Energy) of its natural gas business from its electric business. The name of the new natural gas company will be Spectra Energy Corp (Spectra Energy).

The meeting will be held at 10 a.m., Dec. 11, 2006, in the Grouse Room at the Hyatt Regency Hotel, 655 Burrard St., Vancouver, British Columbia. Exchangeco has fixed Nov. 10, 2006, as the record date for determining the holders of exchangeable shares entitled to notice of and to vote at the special meeting.

In connection with the separation, Duke Energy common shareholders will receive common shares of Spectra Energy by way of a distribution of all of the common shares of Spectra Energy and will also continue to hold Duke Energy common shares. The separation is targeted for completion on Jan. 1, 2007.

The exchangeable shares of Exchangeco are exchangeable on a one-for-one basis for Duke Energy common shares. The proposed reorganization would allow exchangeable shareholders to indirectly participate on an equivalent basis in the distribution of Spectra Energy common shares that will occur in connection with the separation.

Under the reorganization, which will become effective when the separation is complete, the exchangeable shares will be exchanged for: (a), a new class of shares of Exchangeco that are exchangeable on a one-for-one basis for Duke Energy common shares; and (b), a separate new class of shares of Exchangeco that are exchangeable on a one-for-one basis for Spectra Energy common shares.

The proposed reorganization will be effected under a plan of arrangement and will be subject to the affirmative vote of not less than 66.67 percent of the votes cast by holders of exchangeable shares who are present in person or represented by proxy at the special meeting. The reorganization will also be subject to approval by the Supreme Court of British Columbia. If the reorganization is not approved, Exchangeco will, subject to the overriding redemption call right of Duke Energy Canada Call Co., redeem all of the outstanding exchangeable shares for Duke Energy common shares prior to the separation by Duke Energy of its natural gas business.

Further details regarding this and all other matters to be considered at the special meeting are in an information circular sent to all holders of exchangeable shares.

Forward-Looking Statements

This document includes statements that do not directly or exclusively relate to historical facts. Such statements may be considered "forward-looking statements" within the meaning of applicable securities legislation. You can typically identify forward-looking statements by the use of forward-looking words, such as "may", "will", "could", "project", "believe", "anticipate", "expect", "estimate", "continue", "potential", "plan", "forecast" and other similar words. The forward-looking statements reflect management's intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from the forward-looking statements included in this document. Neither Exchangeco nor Duke Energy can provide any assurances that the separation or any of the proposed transactions related thereto will be completed, nor can it give assurances as to the terms on which such transactions will be consummated. The transaction is subject to certain conditions precedent, including final approval by the Duke Energy board of directors.

These risks and uncertainties include, among other things, risks inherent in the contemplated separation and related transactions and borrowings and costs related to the proposed transactions; distraction of Duke Energy and its management as a result of the proposed transactions; state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an impact on rate structures, and affect the speed at and degree to which competition enters the electric and natural gas industries; the outcomes of litigation and regulatory investigations, proceedings or inquiries; the weather and other natural phenomena; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including any potential effects arising from terrorist attacks and any consequential hostilities or other hostilities; changes in environmental and other laws and regulations to which Duke Energy and its subsidiaries are subject or other external factors over which Duke Energy has no control; the effect of accounting pronouncements issued periodically by accounting standard-setting bodies; the amount of collateral required to be posted from time to time in Duke Energy's transactions; competition and regulatory limitations affecting the success of Duke Energy's divestiture plans, including the prices at which Duke Energy is able to sell its assets; the performance of electric generation, pipeline and natural gas processing facilities; the extent of success in connecting natural gas supplies to gathering and processing systems and in connecting and expanding natural gas and electric markets; conditions of the capital markets and equity markets during the periods covered by the forward-looking statements; and opportunities for Duke Energy's business units, including the timing and success of efforts to develop domestic and international power, pipeline, gathering, liquefied natural gas, processing and other infrastructure projects.

Additional factors that may affect the future results are set forth in the Exchangeco filings with the Canadian Securities Administrators, which are available at www.sedar.com, and the Duke Energy, Duke Power Company LLC and Cinergy Corp. filings with the Securities and Exchange Commission, which are available at www.duke-energy.com/investors/. Neither Exchangeco nor Duke Energy undertakes any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Duke Energy Gas Transmission

Duke Energy Gas Transmission (DEGT) is a North American leader in the long-haul transportation and storage of natural gas. For more than three-quarters of a century DEGT and its predecessor companies have developed the critically important pipelines and related energy infrastructure that connects natural gas supply sources to premium markets. Based in Houston, Texas, the company's assets include about 17,500 miles of transmission pipeline and 250 billion cubic feet of storage capacity in the U.S. and Canada. DEGT also has natural gas gathering, processing and distribution assets and natural gas liquids operations that are among the largest in Canada. In June, Duke Energy announced a plan to separate its electric and gas businesses. DEGT, along with Duke Energy's 50 percent ownership in Duke Energy Field Services, expects to become a stand-alone, publicly traded company known as Spectra Energy Corp. Targeted separation date is Jan. 1, 2007. More information can be found at: http://www.degt.duke-energy.com.

Duke Energy is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated, and an affiliated real estate company. Duke Energy supplies, delivers and processes energy for customers in the Americas. Headquartered in Charlotte, N.C., Duke Energy is a Fortune 500 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: http://www.duke-energy.com.

Contact Information

  • Duke Energy Canada Exchangeco Inc.
    Sue Malcolm
    (403) 699-1506 or 24-Hour: (704) 382-8333