(to be read in conjunction with press release from DETI issued today 21.3.05)

Belfast, 21st March 2005:
Northern Ireland Energy Holdings (NIEH) announces that it has acquired the full share capital of Premier Transmission Limited which is a 50/50 joint venture between BG Group and KeySpan. Premier Transmission Limited’s only asset is the Northern Ireland / Scotland Natural Gas Interconnector (SNIP). The total consideration is in the region of £85 million and the transaction is being funded using long-term bond finance.

As the new owner of the SNIP, Northern Ireland Energy Holdings - a company limited by guarantee - will use its profits for the benefit of the consumer to keep down energy costs. The transfer of ownership from BG / Keyspan was completed on 18th March.

In April 2003, a similar transaction led to Moyle Holdings Limited taking ownership of the Moyle Electricity Interconnector between Scotland and Northern Ireland. The resulting savings from this efficient debt funding and ownership have been passed back to consumers in Northern Ireland by Moyle Holdings, which is also a not for dividend company.

In order to maximise the benefits to consumers in Northern Ireland, it is proposed that NIEH and Moyle Holdings will merge so that both important infrastructure assets will be under one company limited by guarantee.

The acquisition of the SNIP, together with the previous acquisition of the Moyle Interconnector will bring substantial benefits to energy consumers in Northern Ireland. OFREG has estimated the acquisition will bring about over £40 million in capital savings in Net Present Value terms over the next 25 years which can be passed on to consumers in Northern Ireland. It is also anticipated that £6 million of the capital savings can be achieved next year for electricity and gas consumers.

The transaction is being completed in consultation with the Regulator and DETI.

Speaking today, Ms Felicity Huston, Director of Northern Ireland Energy Holdings said: “The acquisition of the SNIP together with the previously acquired Moyle Interconnector allows for real benefits to the people of Northern Ireland. Based on low cost finance, these important infrastructural assets are now owned by a not for dividend company representative of energy customers interests and is another important step in the march towards lower energy costs. We are also grateful that this important development has the support of Government which has supported the development of an all island energy policy.

“NIEH’s strategic vision is to see further rationalisation of energy infrastructure within the island of Ireland and at least one further acquisition will be explored by the board.”

ENDS

For further information contact:

Michael McKernan or Owen McQuade at:

Lagan Consulting
Davidson House
Glenavy Road Business Park
Moira
BT67 0LT

Tel: 028 9261 9550
Fax: 028 9261 9951

www.laganconsulting.com

Notes to Editors

Team Northern Ireland

Team NI was established with the support of the London and Belfast Governments to stimulate a private sector response to funding major public projects in Northern Ireland.

Team NI acted as a facilitator during the process of the transaction of the SNIP. The group played a similar role when the Moyle Interconnector was acquired from Viridian Group in 2003.