03-24
For further information:
Richard N. Marshall
Vice President & Treasurer 
Southern Union Company
570/829-8662

PANHANDLE EASTERN PIPE LINE COMPANY
PRICES CASH TENDERS OFFERS

HOUSTON - (BUSINESS WIRE) - August 12, 2003 - Panhandle Eastern Pipe Line Company, LLC (the “Company”) announced today the consideration to be paid in its cash tender offers for any and all of its outstanding senior notes of the series listed below (the “Senior Notes”). The tender offers and the payment of the applicable consideration are subject to certain terms and conditions as set forth in the Offer to Purchase, dated July 9, 2003 and related Letter of Transmittal, including the Company obtaining sufficient financing to pay the consideration payable in the tender offers as well as the consideration required to redeem two other series of the Company’s outstanding debentures.

The tender offers are scheduled to expire at 5:00 P.M. New York City time, on August 14, 2003 unless extended. Subject to satisfaction or waiver of the financing and other conditions referred to above, the settlement date of the tender offers for the Senior Notes is expected to be August 18, 2003.

The consideration for each $1,000 principal amount of applicable Senior Notes properly tendered and accepted for payment was determined as of 2:00 P.M. New York City time, on August 12, 2003 and is based on the yield to maturity on the applicable U.S. Treasury Reference Security plus the applicable fixed spread as set forth in the table below, and assumes a settlement date of August 18, 2003. Holders who tendered the Senior Notes prior to 5:00 P.M. New York City time, on the early tender date of July 22, 2003 will receive the Total Consideration, which includes the applicable Early Tender Payment, as listed below, per $1,000 principal amount of each Senior Note. Holders who tendered after the early tender date and prior to the expiration date of the tender offers will receive the Tender Offer Consideration as listed below. Holders will also receive accrued and unpaid interest up to, but not including, the settlement date, as set forth in the table below.

This press release does not constitute an offer to purchase or a solicitation of an offer to sell any of the Senior Notes. The offers are made solely by the Offer to Purchase dated July 9, 2003 and related Letter of Transmittal.

Merrill Lynch and Banc One Capital Markets, Inc. are acting as the Dealer Managers for the tender offers. Questions concerning the terms of the tender offers may be directed to them as follows: Merrill Lynch, toll-free at 888-654-8637 or by collect call at 212-449-4914; or Banc One Capital Markets, Inc., toll-free at 800-431-2731 or by collect call at 312-732-6047. Copies of the Offer to Purchase may be obtained by calling the information agent, Mellon Investor Services LLC, toll-free at 888-566-9471 or 917-320-6286 (banks and brokerage firms).

Panhandle Energy, a Southern Union Company subsidiary, is comprised of Panhandle Eastern Pipe Line Company, Trunkline Gas Company, Trunkline LNG Company and Sea Robin Pipeline Company. Panhandle Energy operates more than 10,000 miles of mainline natural gas pipeline extending from the Gulf of Mexico to the Midwest and Canada. These pipelines access the major natural gas supply regions of the Louisiana and Texas Gulf Coasts as well as the Midcontinent and Rocky Mountains. The pipelines have a combined peak day delivery capacity of 5.3 billion cubic feet per day, 90 billion cubic feet of underground storage and 6.3 billion cubic feet of above ground liquefied natural gas (LNG) storage facilities.

Southern Union Company (NYSE:SUG) is engaged primarily in the transportation and distribution of natural gas. Through its local distribution companies, Southern Union serves approximately 1 million natural gas end users in Missouri, Pennsylvania, Massachusetts and Rhode Island.

This release and other Company reports and statements issued or made from time to time contain certain “forward-looking statements” concerning projected future financial performance, expected plans or future operations. The Company cautions that actual results and developments may differ materially from such projections or expectations.

Important factors could cause actual results to differ materially from the forward-looking projections or expectations. These factors include, but are not limited to: customer growth; gas throughput volumes and available sources of natural gas; abnormal weather conditions in our service territories; new legislation and government regulations affecting or involving us; our ability to comply with or to challenge successfully existing or new environmental regulations; the outcome of pending and future litigation; the impact of relations with labor unions of bargaining-unit union employees; the impact of future rate cases or regulatory rulings; our ability to control costs successfully and achieve operating efficiencies, including the purchase and implementation of new technologies for achieving such efficiencies; the nature and impact of any extraordinary transactions, such as any acquisition or divestiture of a business unit or any assets; the economic climate and growth in our industry and service territories and competitive conditions of energy markets in general inflationary trends; changes in gas or other energy market commodity prices and interest rates; the current market conditions causing more customer contracts to be of shorter duration, which may increase revenue volatility; exposure to customer concentration with a significant portion of revenues realized from a relatively small number of customers and any credit risks associated with the financial position of those customers; our or any of our affiliates’ debt securities ratings; factors affecting operations such as maintenance or repairs, environmental incidents or gas pipeline system constraints; the possibility of war or terrorist attacks; and other risks and unforeseen events.

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