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Washington Gas to Invest $126 Million in Natural Gas Reserves Utilizing New Virginia Law

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Washington Gas, a subsidiary of WGL Holdings, Inc. (NYSE:WGL) , has signed a conditional purchase and sale agreement with Energy Corporation of America (ECA) to acquire natural gas reserves through working interests in producing natural gas wells in Pennsylvania’s Appalachian Basin. The investment of approximately $126 million in physical natural gas reserves enables Washington Gas to secure a long-term supply of natural gas that is expected to generate substantial savings for Virginia customers over the 20-year investment period.

“Washington Gas is pleased to announce this important partnership with ECA,” said WGL and Washington Gas Chairman and Chief Executive Officer, Terry D. McCallister. “This opportunity to invest directly in low-cost natural gas supplies will help to reduce gas price volatility impacts and provide expected savings to our Virginia customers.”

The purchase of the reserves is conditional upon approval by the Virginia State Corporation Commission. Washington Gas expects to file its proposal with the Commission within a week. The agreement with ECA is the first announced transaction to be filed under a 2014 Virginia law that allows natural gas utilities to recover investments in strategic natural gas facilities that provide cost savings, reduce price volatility or reduce supply risk to utility customers.

The acquired assets include 22 producing wells in Greene County, Pennsylvania, and three producing wells in Clearfield County, Pennsylvania, all of which will be operated by ECA.

“From our perspective, ECA’s more than 50 years of production experience in the Appalachian Basin combined with Washington Gas’ long history of reliable delivery of natural gas will serve for a great partnership,” said ECA Chief Executive Officer John Mork.

ECA is one of the premier operators in the region and currently operates more than 4,600 wells throughout Appalachia.

KeyBanc Capital Markets acted as exclusive financial advisor to Washington Gas.

About WGL:

WGL (NYSE-WGL), headquartered in Washington, D.C., is a leading source for clean, efficient and diverse energy solutions. With activities and assets across the U.S., WGL consists of Washington Gas, WGL Energy, WGL Midstream and Hampshire Gas. WGL Energy delivers a full ecosystem of energy offerings including natural gas, electricity, green power, carbon reduction, distributed generation and energy efficiency provided by WGL Energy Services, Inc. (formerly Washington Gas Energy Services, Inc.), WGL Energy Systems, Inc. (formerly Washington Gas Energy Systems, Inc.) and WGSW, Inc. WGL provides options for natural gas, electricity, green power and energy services, including generation, storage, transportation, distribution, supply and efficiency. Our calling as a company is to make energy surprisingly easy for our employees, our community and all our customers. Whether you are a homeowner or renter, small business or multinational corporation, state and local or federal agency, WGL is here to provide Energy Answers. Ask Us. For more information, visit us at

About ECA:

Founded in 1963, Energy Corporation of America (ECA) is a privately held company that actively pursues the exploration, extraction, production, and transportation of natural gas and oil, both in the United States and around the world. ECA owns and operates approximately 4,600 wells, 5,000 miles of pipeline, and a million acres in North America alone. Since its inception, ECA has been deeply committed to its employees and their families. Through the use of profit sharing, a stock ownership program, an education program, and its award-winning wellness program, ECA facilitates the development of its employees in all areas.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the cost of the purchased gas supplies relative to market prices, the amount of volatility of gas supply prices and savings to customers, the level of output of the wells during the investment period, the timing of our filing of our proposal with the Virginia State Corporation Commission, and other future expectations. Forward-looking statements are typically identified by words such as, but not limited to, “estimates,” “expects,” “anticipates,” “intends,” “believes,” “plans,” “forecasts,” and similar expressions, or future or conditional verbs such as “will,” “should,” “would,” and “could.” Although we believe such forward-looking statements are based on reasonable assumptions, we cannot give assurance that every objective will be achieved. Forward-looking statements speak only as of today, and we assume no duty to update them. Factors that could cause actual results to differ materially from those expressed or implied include, but are not limited to, the production of the wells in which we purchased a working interest, natural gas price levels and volatility, the effectiveness of ECA in operating the wells, counterparty risks, the timing of our filing of our proposal with the Virginia State Corporation Commission, whether the Virginia Corporation Commission approves our proposal, general economic conditions and the factors discussed under the “Risk Factors” heading in our most recent annual report on Form 10-K and other documents filed with or furnished to the Securities and Exchange Commission.

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