99 Years of Continuous Quality Service Wyoming Pipeline Authority Meeting August 26 th 2003 Michael Walsh President &Chief Operating Officer Jerry Morris VP Bus. Dev. & Strategic Planning Donny King Project Manager Bus. Dev.

Michael Walsh President and Chief Operating Officer

Organizational Overview AIG Highstar Southern Star Central Pipeline Southern Star is wholly owned by AIG Highstar Organizational Overview Western Frontier Pipeline Company, LLC 2

4 AIG Highstar Portfolio (March 2003) –Eight investments: average size $42MM; 84% energy, 16% transportation –Energy: natural gas storage, interstate natural gas pipeline, power generation, waste-to-energy –Transportation: logistics, asset management, and construction materials AIG Highstar Fund Summary

3 AIG Highstar Capital, L.P. (AIG Highstar) Fund Summary Private equity fund formed to make structured equity investments in infrastructure projects and operating companies $406 million in capital commitments (approx. $330 million committed as of March 2003) Limited partners include multi-national corporations, financial services companies, and industry-focused funds

5 Sponsored by AIG and managed by AIG Global Investment Corp. (AIGGIC) –AIG is one of the worlds leading U.S.-based international insurance and financial services organization –AIG Global Investment Group, AIGGICs parent, has $329 billion in assets, including over $53 billion of external client assets, under management.* AIG Highstar Fund Summary *Source: AIG Global Investment Corp. and its affiliates. AIGGIG is a holding company whose subsidiaries and investment affiliates provide asset management services (the "AIGGIG Companies"). The assets under management for AIGGIG refers to assets advised or sub-advised by AIGGIG Companies. Assets sub-advised to third party managers are not included in this report, but will be available upon request.

Jerry Morris VP Bus. Dev. & Strategic Planning

Organizational Overview AIG Highstar Southern Star Central Pipeline Southern Star is wholly owned by AIG Highstar Organizational Overview Western Frontier Pipeline Company, LLC 2

Operational Overview Southern Star Central Pipeline is a FERC-regulated interstate natural gas pipeline company providing transportation and storage services in seven states in the central U.S., including major metropolitan areas in Kansas and Missouri Transportation capacity of approximately 2.3 Bcf/day On-system working gas storage capacity of 43 Bcf Assets: –6,076 miles of mainline, branch, and storage pipelines –41 compressor stations 223,916 HP –8 on-system storage fields –31 Pipeline Interconnects Headquartered in Owensboro, Kentucky –457 total employee complement 15 Operating Districts –330 field employees Overview Operational Overview Southern Star Central Pipeline Map 7

Organizational Overview AIG Highstar Southern Star Central Pipeline Southern Star is wholly owned by AIG Highstar Organizational Overview Western Frontier Pipeline Company, LLC 2

S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Western Frontier History Filed with FERC October 2001 Design 540,000 Dth/day Cheyenne Hub to Mid-Continent 400 Mile 30 Pipeline Financial Distress of Previous Parent Forced Project to be Shelved FERC Filing Withdrawn in June 2002 AIG Highstar Acquired Southern Star Central & Western Frontier in November 2002 Financial Capabilities now Stronger than Ever Open Season Announced August 18 th 2003

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Reasons For Suspending the Project –Recession –Cautious Capital Markets –Enron debacle –Williams Communications demise –Williams overall financial woes Current Status –Western Frontier is Back –Financially Capable of Implementing Project with Market Support

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Challenges Drilling Timing - Environmental Constraints Issuance of Drilling Permits – originally a 75 day process currently taking 175 days Producers Subscribing to Capacity in todays market for 10 year terms State Commissions Lack of Risk Management Services FERC Certification Process

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Opportunities Wyoming Pipeline Authority (WPA) –Production Aggregator –Risk Management State of Wyoming – MMcfd Royalty Gas Potential State Lands (2 Section in Every Range) 50% of all Federal Royalty Severance Tax In-Kind (Legislative Action Required) AdValorem Tax In-Kind (State Constitutional Amendment Required) Competitive Pipeline Alternative in the Rockies Gas Price Volatility Nation Wide Declining Supply Deliverability in the Mid-continent & Canada Tremendous Production Growth Potential in the Rockies Substantial Work Already Completed on Western Frontier

Energy Information Administration Natural Gas Monthly October 2000 Quote for Rocky Mountain Region Expanding coal-bed methane production has outpaced the development of long-haul capacity to carry the gas to end-use markets. Capacity constraint problems exiting the production areas have resulted in the region having the lowest average natural gas spot prices in the nation. 99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Dont Let This be the Quote of the Future!

Donny King Project Manager Business Development

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Rockies Production Growth Production in Wyoming totals about 4.2 Bcfd now and if environmental and regulatory delays can be cleared, could grow to in excess of 6 Bcfd over the next 5 years Wyoming state budget is heavily dependent upon revenues received from mineral production produced from state & federal lands. During the past 5 years, natural gas production has grown almost 50% in the state, with limited additions to the infrastructure to export growing production Source: WPA GD 7/9/03

Source: Energy Information Administration, GasTran Gas Transportation Information System Major Natural Gas Producing Basins and Pipeline Transportation Corridors to Market Areas 99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E

10 % annual decline

5 % annual decline

Mid-Continent Production Richard Sharples, President of Anadarko Energy Services on the status of Mid-continent supplies: The Mid-continent is so mature that it doesnt matter how much you drill, you wont increase production From Gas Daily Friday, February 16, Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E

Insert map 540-1,000 MDth/day Cheyenne Hub to Mid- Continent 400 Mile P/L Targeted In-Service date Mid-continent Hub 6.8 Bcfd of interstate takeaway capacity

S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E 540, ,000,000 Dth/day Cheyenne Hub to Mid- Continent 400 Miles P/L 30,000-60,000 HP 100% LF Rate Range to pipeline hub is $ Anticipated Fuel at 1% or Less Targeted In-Service Timeframe Mid-continent Hub 6.8 Bcfd of interstate takeaway capacity

Project Activities Completed –Pipeline Route Established –Aerial Photography –Detailed Land Survey –Biological and Archeological Study –Over 26% of Right-of-Way Acquired –Station Site Acquired Project Activities Underway –Project Engineering Review and Estimate Refinement –Non-binding Open Season August 18 th - October 10 th –Western Frontier Website Available – 99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E

540,000 Dth/day Echo Springs/Wamsutter to Cheyenne Hub 186 Miles 30 P/L 41,000 HP Greater Green River Takeaway Capacity Targeted In-Service Date of

99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E Conclusions Gas Market will Remain Tight in Near Term Leaves Market Vulnerable to Price Volatility If Environmental & Regulatory delays can be cleared Wyoming Production could Grow from the current 4.2 Bcfd to in excess of 6 Bcfd over the next 5 years New Infrastructure will be required to get this gas to Market New Infrastructure should help stabilize cash flow for funding producer drilling investments and the State of Wyoming budgeting activities. Western Frontier Project Situated to meet Market Needs Quickly & Efficiently with Market Support

Why Western Frontier? –Mid-Continent Supply Basins Declining Anadarko 5% Annually Hugoton 7-10% Annually Supply Diversification Necessary –Rockies Supply Prolific needs Additional Market Access –Basin Diversification Cheyenne Hub Denver Julesburg (DJ) Basin –Average Differential Between Rockies-Cheyenne Hub and Mid-Continent Inception to Present= $0.80 –Dynamic Operating Hub - Additional Infrastructure Needed out of Cheyenne Hub –Diverse Market Access Providing Liquidity –Market Growth Oklahoma Intrastate Market Southwest Missouri 99 Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E

Contact Information Jerry Morris – (270) Donny King – (270) Dale Sanders – (270) Years of Continuous Quality Service S O U T H E R N S T A R C E N T R A L G A S P I P E L I N E