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Citizens Energy Group and Vectren Corporation announce sale by ProLiance holdings, LLC of wholesale gas marketing assets

Today, Vectren Corporation and Citizens Energy Group announced jointly-owned affiliate, ProLiance Holdings, LLC (ProLiance), has disposed of certain of the net assets, along with the long term pipeline and storage commitments, of its wholesale natural gas marketing subsidiary, ProLiance Energy, LLC, to a subsidiary of Energy Transfer Partners (NYSE: ETP).  ProLiance is jointly owned by affiliates of Vectren (61% ownership) and Citizens Energy Group (39% ownership).

ProLiance’s decision to sell these assets is consistent with Vectren’s previously stated strategy, including in its most recent filing on Form 10-Q. Vectren disclosed that it continues its emphasis on growing its infrastructure and energy services businesses and that the analysis and evaluation of strategic alternatives related to the investment in its energy marketing affiliate was ongoing. The sale is also consistent with Citizens Energy Group’s strategy to focus on utility related businesses in Central Indiana.

“We are very pleased ProLiance found a logical buyer for the net assets of ProLiance Energy in Energy Transfer Partners, which is well-positioned to continue to serve ProLiance Energy’s customers," said Carl Chapman, Vectren's chairman, president and CEO. "We're confident the transition will go smoothly for ProLiance's customers.”

Under the new ownership by Energy Transfer Partners, continued net benefits to Vectren’s and Citizens’ gas utility customers are expected. ETP plans to maintain an Indianapolis office and to retain most current ProLiance employees.

“Historically, ProLiance has been a great business for Citizens and Vectren, and utility customers have saved more than $200 million in lower natural gas costs since its inception in 1996,” said Carey Lykins, President & CEO of Citizens Energy Group.

Upon final adjustments for working capital, costs and fees associated with the disposition of these net assets, ProLiance expects to record a loss of between ($62) million and ($67) million. Vectren’s after-tax share of the net loss to be recorded in its second quarter of 2013 is expected to be between ($26) million and ($28) million, or ($0.32) to ($0.34) per share. The loss associated with the disposition by Vectren’s unconsolidated subsidiary, ProLiance, has no material cash flow impact to Vectren. Through the date of the disposition, Vectren’s share of the 2013 expected operating losses are estimated to be ($0.10) to ($0.12) per share.

The sale of ProLiance is not expected to impact the natural gas or water bills of Citizens’ customers.
About ProLiance Energy

ProLiance Holdings, LLC owns ProLiance Energy, LLC, which is a full-service natural gas marketing company. ProLiance Energy purchases natural gas from a variety of supply basins and transports the gas through many different pipelines to provide competitively-priced natural gas to its customers. ProLiance Holdings also owns ProLiance Transportation and Storage that owns transportation and storage assets and provides service to the member utility companies and other entities.

Energy Transfer Partners, L.P. (NYSE: ETP) is a master limited partnership owning and operating one of the largest and most diversified portfolios of energy assets in the United States. ETP currently has natural gas operations that include approximately 47,000 miles of gathering and transportation pipelines, treating and processing assets, and storage facilities. ETP owns 100% of ETP Holdco Corporation, which owns Southern Union Company and Sunoco, Inc., and a 70% interest in Lone Star NGL LLC, a joint venture that owns and operates natural gas liquids storage, fractionation and transportation assets. ETP also owns the general partner, 100% of the incentive distribution rights, and approximately 33.5 million common units in Sunoco Logistics Partners L.P. (NYSE: SXL), which operates a geographically diverse portfolio of crude oil and refined products pipelines, terminalling and crude oil acquisition and marketing assets. ETP’s general partner is owned by Energy Transfer Equity, L.P.

About Vectren

Vectren Corporation (NYSE: VVC) is an energy holding company headquartered in Evansville, Ind. Vectren’s energy delivery subsidiaries provide gas and/or electricity to more than 1 million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren’s nonutility subsidiaries and affiliates currently offer energy-related products and services to customers throughout the U.S. These include infrastructure services, energy services, and coal mining. To learn more about Vectren, visit www.vectren.com.

About Citizens Energy Group

Citizens Energy Group is a Public Charitable Trust providing safe and reliable utility services to more than 400,000 residential, commercial and industrial customers in the Indianapolis area. The Public Charitable Trust means its utilities are managed only for the benefit of customers and the community.

About Citizens Energy Group

Citizens Energy Group provides safe and reliable utility services to about 800,000 people in the Indianapolis area. Citizens operates its utilities only for the benefit of customers and the community. Additional information is available online at Facebook - Twitter - LinkedIn - YouTube

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