October 14, 1999

U.S. Steel - Primary Energy Cogeneration Plant at Gary Works Wins National Recognition

Merrillville, Ind. -U.S. Steel Group of USX Corp. (NYSE: X) and NiSource Inc. (NYSE: NI) subsidiary Primary Energy Inc. have captured national attention after two U. S. Steel Gary Works employees were awarded the Association of Iron and Steel Engineers' (AISE) Project Excellence Award for 1999 at their annual convention Sept. 30.

The prestigious award was presented at a dinner ceremony Tuesday evening at the Radisson Star Plaza in Merrillville, Ind., in recognition of the high level of success that has resulted from the installation of a161-megawatt cogeneration plant at the Gary facility.

AISE's recognition identifies the U.S. Steel-Primary Energy cogeneration project as the top engineered project in the steel industry in 1999. There were no qualifying projects last year, making this only the second time the award has been presented since its inception in 1997.

The award recognizes a successful project that combines advancements in steelmaking and environmental control with a novel business approach, which strengthens the competitiveness of the steel industry.

"We are especially proud to share in this award with U. S. Steel because it shows that the entire industry recognizes the level of cooperation required to make this kind of energy project successful," said Primary Energy President Joseph L. Turner.

"In addition, this business venture continues to reap rewards because we have been able to duplicate the success of this project with other industrial customers."

The Project Excellence Award application and paper was prepared and presented to AISE by U. S. Steel's Richard M. Moroney, senior process engineer, and Ronald C. Olson, area manager-Energy Distribution & Facility Development, who served as co-project coordinators for U. S. Steel. Their paper outlines the joint-venture cogeneration project to convert coke oven and blast furnace gasses into electricity. It describes the design, construction and management of the cogeneration plant, which has been in commercial operation since August 1997. While Primary Energy designed, constructed and owns the facility, it is operated and maintained by U.S. Steel.

"We are honored to win this prestigious award from this distinguished engineering organization," said Gary Works General Manager Leonard H. Chuderewicz. "It's a gratifying recognition of the hard work, innovation and professionalism displayed by the Gary Works' team who worked on this project, along with Primary Energy and outside contractors."

AISE will publish the award-winning paper in its entirety in the December issue of its monthly magazine, which will be renamed "AISE Steel Technology." It is currently called "Iron and Steel Engineer."

In accepting the award, a mounted Waterford crystal bowl, Charles R. Smith, division manager-Operations Services for U. S. Steel Gary Works, noted that this project was not only the outstanding engineering project in the entire steel industry last year, but it represented a tremendous win-win effort for both U. S. Steel and Primary Energy.

"The project has experienced enormous success, not only in terms of AISE selection criteria, but in terms of real-world application and resulting cost savings at Gary Works," Smith said. Smith also congratulated Gary Works' Richard Moroney and Ronald Olson, along with the rest of their project team and Primary Energy.

"The fact that there are several layers of success built into this project makes this award even more satisfying," said Kenneth P. Foley, director of Production & Maintenance at Primary Energy.

"For example, NiSource subsidiary Northern Indiana Public Service Co. (NIPSCO) is able to avoid construction of new generating capacity to help it meet growing demand for electricity and keep rates down for its customers." In June of 1999, the cogeneration facility set an all-time record by producing more than 53 percent of the power required at Gary Works, the largest integrated steel facility in North America.

U.S. Steel Group, with an annual raw steel capacity of 12.8 million tons, is the largest integrated steel producer in North America. The company, headquartered in Pittsburgh, Pa., manufactures and sells a wide variety of steel mill products and raw materials from its operations in Gary, Ind.; Fairfield, Ala.; Pittsburgh and Philadelphia, Pa.; and the Mesabi Iron Range in Minnesota. Its activities also include management of mineral resources, domestic coal mining, engineering and consulting services and technology licensing. Information about U. S. Steel Group and Gary Works is available on the internet at www.usx.com or www.ussteel.com.

Primary Energy Inc., a wholly owned subsidiary of NiSource, invests in and manages projects that optimize energy productivity, while reducing operating costs for large, energy-intensive industrial and commercial complexes. Primary Energy specializes in on-site electric and steam-generating facilities, and acts with a strong customer focus to assure its customers' objectives are being met. Target markets include the steel, refining, chemical, food products, and pulp and paper industries in North America. Information about Primary Energy is available via the Internet at www.primaryenergy.com.

NiSource Inc. is a holding company with a market capitalization of approximately $3.6 billion whose primary business is the distribution of electricity, natural gas and water in the Midwest and Northeast United States. The company also markets utility services and customer-focused resource solutions along a corridor stretching from Texas to Maine. Further information may be accessed on the Internet at www.nisource.com.


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