For Release: 04/19/2006

Peoples Energy Reaffirms Safety of Gas Delivery System

CHICAGO, IL – Recently, the Illinois Commerce Commission (ICC) conducted a field audit of the company's corrosion inspections that identified a number of apparent inconsistencies between our readings and the ICC readings.

The company is conducting its own investigation into these matters.

As a point of reference, about 30% of our system is steel piping that requires corrosion monitoring under federal regulations that require inspection every 10 years.

First and foremost, we want to assure our customers that the Peoples Gas delivery system is safe and reliable. The company has a comprehensive program to identify and repair leaks.

Annually, the company performs leak surveys on its distribution system in accordance with federal code. Leak detection equipment is utilized to complete these inspections across our service territory dependent on main type, gas pressure and location. The company has a comprehensive program to identify and replace pipes that show signs of deterioration.

Although the company's internal review into these corrosion inspection matters is ongoing, our Operations team immediately began to address this issue.

The Operations team hired third-party independent industry experts — including Northstar Industries which does both turnkey engineering and construction of gas distribution, pipeline and storage facilities, and Navigant Consulting — which has a respected utility practice — to conduct a comprehensive review of all of our key compliance work starting with corrosion inspections. We will begin to implement this program by the end of the month.

This independent review has already identified improvements that will help us to ensure that we are using the best compliance standards in the industry. They include the following commitments:

  • Enhanced refresher training for all employees involved in these processes.
  • A more rigorous auditing program for all compliance work.
  • An improved Quality Assurance program for all compliance work.

The company is committed to working with the Illinois Commerce Commission to address these issues.

Peoples Energy, a member of the S&P 500, is a diversified energy company comprised of three primary business segments: Gas Distribution, Oil and Gas Production and Energy Marketing. The Gas Distribution business serves about one million retail customers in Chicago and northeastern Illinois. Visit the Peoples Energy Web site at

For More Information, Contact:

  • Rod Sierra (Media)
  • Doug Ruschau (Investor Relations)

WEC Energy Group