NiSource Announces Results to Date for Its Cash Tender Offer

MERRILLVILLE, Ind., Dec. 17, 2010 /PRNewswire-FirstCall/ — NiSource Inc. (NYSE:
NI) announced today that, pursuant to the previously announced cash tender offer
of its finance subsidiary, NiSource Finance Corp., approximately $272.9 million
aggregate principal amount of its outstanding 10.75% Notes due 2016 (“2016
Notes”) were validly tendered and not validly withdrawn before 5:00 p.m., New
York City time, on Tuesday, December 14, 2010, according to information provided
by Global Bondholder Services Corporation, the depositary for the tender offer.

Based on the principal amount of 2016 Notes tendered to date, NiSource Finance
has increased the maximum aggregate principal amount of 2016 Notes it will
purchase from $250 million to $325 million and is terminating the portion of the
tender offer relating to its 6.80% Notes due 2019 (“2019 Notes”). As a result,
no 2019 Notes will be accepted for payment, and all 2019 Notes tendered pursuant
to the tender offer will be promptly returned to their holders.

NiSource Finance has also extended the deadline by which holders who tender
their 2016 Notes will be eligible to receive the early tender payment until
11:59 p.m., New York City time, on December 29, 2010 (the “Revised Early
Participation Date”), unless further extended by NiSource Finance. However,
withdrawal rights for 2016 Notes tendered in the tender offer have not been
extended and therefore expired at 5:00 p.m., New York City time, on December 14,
2010. Tenders submitted after that time are irrevocable except in the limited
circumstances where additional withdrawal rights are required by law.

As previously announced, the total consideration to be received for each $1,000
principal amount of 2016 Notes validly tendered and not withdrawn in the tender
offer before the Revised Early Participation Date and accepted for purchase will
be $1,337.10. This amount, which includes an early tender payment of $30.00,
will be paid in cash. In addition, holders whose 2016 Notes are accepted for
purchase will receive accrued and unpaid interest up to, but not including, the
settlement date, which is expected to be one business day after the date on
which the offer expires.

The tender offer is scheduled to expire at 11:59 p.m., New York City time,
December 29, 2010, unless extended or earlier terminated. If more than $325
million aggregate principal amount of 2016 Notes is validly tendered and not
validly withdrawn before the expiration date, NiSource Finance will accept 2016
Notes for purchase on a pro rata basis.The offer is subject to the terms and
conditions described in the Offer to Purchase, dated December 1, 2010, and the
related Letter of Transmittal.

The offer is subject to the satisfaction or waiver of certain conditions set
forth in the Offer to Purchase, including a financing condition which has now
been satisfied as a result of NiSource Finance’s sale of $250 million aggregate
principal amount of 6.25% Notes due 2040, which closed December 8, 2010.

Questions regarding the tender offer may be directed to the Dealer Managers,
Deutsche Bank Securities Inc. at (212) 250-2955 (collect) or (866) 627-0371
(toll-free), or RBS Securities Inc. at (203) 897-6145 (collect) or (877)
297-9832 (toll-free). Requests for documents may be directed to Global
Bondholder Services Corporation, the information agent and depositary for the
tender offer, at (212) 430-3774 (for banks and brokers) or (866) 952-2200
(toll-free).

This news release is for informational purposes only and does not constitute an
offer to purchase or a solicitation of an offer to sell with respect to the
notes subject to the tender offer, nor is this news release an offer to sell, a
solicitation to buy or an offer to purchase or sell any securities. The tender
offer is being made only pursuant to the Offer to Purchase and only in such
jurisdictions as is permitted under applicable law.

About NiSource

NiSource Inc., based in Merrillville, Ind., is a Fortune 500 company engaged in
natural gas transmission, storage and distribution, as well as electric
generation, transmission and distribution. NiSource operating companies deliver
energy to 3.8 million customers located within the high-demand energy corridor
stretching from the Gulf Coast through the Midwest to New England. Information
about NiSource and its subsidiaries is available via the Internet at
www.nisource.com. NI-F

Forward-Looking Statements

This news release includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Those statements include statements
regarding the intent, belief or current expectations of NiSource and its
management. Although NiSource believes that its expectations are based on
reasonable assumptions, it can give no assurance that its goals will be
achieved. Readers are cautioned that the forward-looking statements in this news
release are not guarantees of future performance and involve a number of risks
and uncertainties, and that actual results could differ materially from those
indicated by such forward-looking statements. Important factors that could cause
actual results to differ materially from those indicated by such forward-looking
statements include, but are not limited to, the following: weather; fluctuations
in supply and demand for energy commodities; growth opportunities for NiSource’s
businesses; increased competition in deregulated energy markets; the success of
regulatory and commercial initiatives; dealings with third parties over whom
NiSource has no control; actual operating experience of NiSource’s assets; the
regulatory process; regulatory and legislative changes; the impact of potential
new environmental laws or regulations; the results of material litigation;
changes in pension funding requirements; changes in general economic, capital
and commodity market conditions; and counter-party credit risk, and the matters
set forth in the “Risk Factors” section in NiSource’s 2009 Form 10-K and 2010
Forms 10-Q, many of which risks are beyond the control of NiSource. NiSource
expressly disclaims a duty to update any of the forward-looking statements
contained in this release.