Dynegy Provides Update on Sales of Interests in Non-Core Power Generation Assets

Business Wire, Sept 28, 2004

HOUSTON -- Dynegy Inc. (NYSE:DYN) today announced that it has completed the sale of its 50 percent ownership in the Hartwell Power Generation Facility in Hartwell, Ga. to Centennial Power, Inc., an indirect wholly owned subsidiary of MDU Resources Group Inc. Terms of the sale of the 310-megawatt, natural gas-fired peaking facility were not disclosed.

The sale of the Hartwell facility was previously identified as part of the company's divestiture of non-core power generation assets. To date in 2004, Dynegy has also sold its interests in the Michigan Power and Oyster Creek (Texas) qualifying facilities, as well as its interests in power generation facilities in Costa Rica and Jamaica. In addition, the company has announced plans to sell its 50 percent interest in the Commonwealth natural gas-fired peaking facility in Chesapeake, Va. to Dominion Virginia Power, a subsidiary of Dominion. The Commonwealth sale, which is expected to close in the fourth quarter 2004, is subject to the receipt of required lender consents, as well as approval by federal and state regulatory agencies. Dynegy believes it remains on target to raise approximately $170 million in connection with the sale of non-core generation assets in 2004.

Dynegy's ongoing power generation business consists of a geographically diverse fleet of baseload, intermediate and peaking power plants fueled by a mix of coal, fuel oil and natural gas. Located in 12 U.S. states, the portfolio is well-positioned to capitalize on regional differences in power prices and weather-driven demand. The power generation business also manages commodity price risk associated with fuel procurement and trades around its assets to deliver products and services to the nation's wholesale energy system.

Dynegy Inc. provides electricity, natural gas and natural gas liquids to customers throughout the United States. Through its energy businesses, the company owns and operates a diverse portfolio of assets, including power plants totaling 11,885 megawatts of net generating capacity, gas processing plants that process approximately 1.8 billion cubic feet of natural gas per day and nearly 38,000 miles of electric transmission and distribution lines.

Certain statements included in this news release are intended as "forward-looking statements." These statements include assumptions, expectations, predictions, intentions or beliefs about future events, particularly the statements concerning the company's ability to consummate the sale of its Commonwealth facility in the anticipated timeframes. Dynegy cautions that actual future results may vary materially from those expressed or implied in any forward-looking statements. Some of the key factors that could cause actual results and the periods affected to vary materially from those expected include the receipt of required regulatory and other approvals and the satisfaction of other closing conditions. More information about the risks and uncertainties relating to these forward-looking statements are found in Dynegy's SEC filings, including its Annual Report on Form 10-K for the year ended Dec. 31, 2003, as amended, and its Quarterly Report on Form 10-Q for the quarter ended June 30, 2004, which are available free of charge on the SEC's web site at http://www.sec.gov. Dynegy expressly disclaims any obligation to update any forward-looking statements contained in this news release to reflect events or circumstances that may arise after the date of this release, except as otherwise required by applicable law.