AES To Acquire Interest in Gas Pipeline and Power Project in Tanzania

ARLINGTON - August 1, 2000 - The AES Corporation announced today that its subsidiary, AES Sirocco, has entered into an agreement whereby AES will acquire the 49% interest held by TransCanada PipeLines Limited (TSE: TRP) (NYSE: TRP) in the Songo Songo Gas-to-Electricity Project in Tanzania, as well as assume overall project management responsibility.

The project consists of the refurbishment and operation of five natural gas wells in coastal Tanzania, the construction and operation of a 65 mmscf/day gas processing plant and related facilities, the construction of a 230 km marine and land pipeline from the gas plant to Dar es Salaam and the conversion and upgrading of an existing 112 MW power station in Dar es Salaam to burn natural gas, with an optional additional unit to be constructed at the plant.

Total project cost will be approximately $325 million. Financial close is anticipated by the end of 2000 or early in 2001.

Mr. Mark Fitzpatrick, Executive Vice President of AES, said "We are delighted to be participating in this important project, which will bring great economic benefit to Tanzania through the development of its indigenous gas resources and the reduction of the country's dependence on imported oil and unreliable hydrology. The Songo Songo project is a key element of AES's commitment to expand its activities throughout Africa and we look forward to achieving financial close and to starting construction early next year."

Mr. Dennis W. Bakke, President and Chief Executive Officer of AES, stated "This project is a terrific example of AES's desire to serve people where we are needed and can provide clean, low cost, reliable electricity. Our work in nearby Uganda since the fall of 1994 has contributed to our confidence that we can make a difference in this region. We look forward to delivering on the commitments we have made to the people of Tanzania."

AES's acquisition of TransCanada's interest has received approval from the Government of Tanzania, the World Bank and the European Investment Bank (the lenders to the project), as well as from the other equity participants: PanAfrican Energy (formerly Ocelot International), CDC and the Tanzania Development Finance Company Limited. The transaction is expected to close on August 25.

HSBC acted as financial advisor and CMS Cameron McKenna acted as counsel to AES.

AES is a leading global power company comprised of competitive generation, distribution and retail supply businesses in Argentina, Australia, Bangladesh, Brazil, Canada, China, Dominican Republic, El Salvador, Georgia, Hungary, India, Kazakhstan, the Netherlands, Mexico, Pakistan, Panama, the United Kingdom, the United States and Venezuela.

The company's generating assets include interests in one hundred and thirty three facilities totaling over 47 gigawatts of capacity. AES' electricity distribution network has over 920,000 km of conductor and associated rights of way and sells over 126,000 gigawatt hours per year to over 17 million end-use customers.

In addition, through its various retail electricity supply businesses, the company sells electricity to over 154,000 end-use customers. AES is dedicated to providing electricity worldwide in a socially responsible way.

For more general information visit our web site at www.aesc.com or contact investor relations at . The list aes-pr-announce is an automated mailing list and can be found on the investing page of our web site. Those who subscribe to this list will receive updates when AES issues a press release.