Sempra Energy Unit to Acquire AEI’s Stake in South American Utilities

Earnings-Per-Share Outlook for 2011 Updated to $4.00-to-$4.30 Range

Jan 19, 2011

SAN DIEGO, Jan. 19, 2011 – Sempra Energy (NYSE: SRE) today announced that its subsidiary, Sempra Pipelines & Storage, will acquire, for approximately $875 million, AEI’s stake in two South American utilities jointly owned with AEI.
  
Currently, Sempra Pipelines & Storage and AEI each own 50 percent of Chilquinta Energía S.A. in Chile and approximately 38 percent of Luz del Sur in Peru.  Upon completion of this transaction, Sempra Pipelines & Storage will own 100 percent of Chilquinta Energía and approximately 76 percent of Luz del Sur, with the remaining shares of Luz del Sur held by institutional investors and the general public.
  
Scheduled to close in the second quarter 2011, the transaction is expected to contribute additional earnings per share for Sempra Energy of approximately $0.15 per share in 2011 and $0.22 per share in 2012.   These additional earnings are net of estimated financing costs and assume the use of excess funds from foreign operations and previously announced asset sales to fund this transaction.

With today’s announcement, Sempra Energy has updated its 2011 earnings-per-share outlook to a range of $4.00 to $4.30.   

“We expect these additional investments in Chilquinta Energía and Luz del Sur to produce stable, long-term returns for our shareholders,” said Donald E. Felsinger, chairman and chief executive officer of Sempra Energy.  “We have been a co-owner of these utilities for 12 years.  Both Chilquinta Energía and Luz del Sur have a successful track record of earnings growth and offer continuing opportunities to re-invest capital in expanding infrastructure.”

Chilquinta Energía is an electric distribution utility serving approximately 590,000 customers in the cities of Valparaiso and Vina del Mar in central Chile.
 
Luz del Sur is an electric distribution utility that serves approximately 886,000 customers in the southern zone of metropolitan Lima, Peru, and delivers approximately one-third of all power used in the country.  Luz del Sur is listed on the Lima Stock Exchange under the symbol “LUSURBC1.”

“Chilquinta Energía and Luz del Sur are based in high-growth areas of South America – in two countries with increasing levels of foreign investment, strong institutions and stable political and business environments,” said George S. Liparidis, president and chief executive officer of Sempra Pipelines & Storage.
 
As part of the transaction, Sempra Pipelines & Storage also has agreed to acquire AEI’s interests in two energy-services companies, Tecnored S.A. and Tecsur S.A.
The transaction is subject to AEI shareholder approval and other closing conditions, including obtaining regulatory approvals and resolution of certain tax matters.

Sempra Pipelines & Storage develops, builds and operates natural gas pipelines and storage facilities in Latin America and the United States.  The company operates and/or owns more than 2,000 miles of transmission pipelines and 23 billion cubic feet of natural gas storage capacity. Sempra Pipelines & Storage also manages natural gas and electricity distribution in Argentina, Chile, Mexico, Peru and the United States.
  
Sempra Energy, based in San Diego, is a Fortune 500 energy services holding company with 2009 revenues of about $8 billion.  The Sempra Energy companies’ 13,800 employees serve about 25 million consumers worldwide.

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This press release contains statements that are not historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements can be identified by words like “believes,” “expects,” “anticipates,” “intends,” “plans,” “estimates,” “may,” “would,” ”could,” “should,” or similar expressions, or discussions of strategies, plans or intentions.  Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  Future results may differ materially from those expressed in the forward-looking statements.  Forward-looking statements are necessarily based upon various assumptions involving judgments with respect to the future and other risks, including, among others: local, regional, national and international economic, competitive, political, legislative and regulatory conditions and developments; actions by the California Public Utilities Commission, California State Legislature, California Department of Water Resources, Federal Energy Regulatory Commission, Federal Reserve Board,  and other regulatory and governmental bodies in the United States and other countries where the company does business; capital market conditions and inflation, interest and exchange rates; energy and trading markets, including the timing and extent of changes and volatility in commodity prices; the availability of electric power, natural gas and liquefied natural gas; weather conditions and conservation efforts; war and terrorist attacks; business, regulatory, environmental and legal decisions and requirements; the status of deregulation of retail natural gas and electricity delivery; the timing and success of business development efforts; the resolution of litigation; and other uncertainties, all of which are difficult to predict and many of which are beyond the control of the company.  These risks and uncertainties are further discussed in the reports that Sempra Energy has filed with the Securities and Exchange Commission.  These reports are available through the EDGAR system free-of-charge on the SEC’s website, www.sec.gov, and on the company’s website at www.sempra.com.

Sempra Pipelines & Storage, Sempra Generation, Sempra LNG and RBS Sempra Commodities dba Sempra Energy Solutions and Sempra Energy Trading are not the same companies as the utility, San Diego Gas & Electric (SDG&E) or Southern California Gas Company (SoCalGas), and Sempra Pipelines & Storage, Sempra Generation, Sempra LNG and RBS Sempra Commodities dba Sempra Energy Solutions and Sempra Energy Trading are not regulated by the California Public Utilities Commission.

For further information: Media Contact: Ricardo Moreno, Sempra Pipelines & Storage, (866) 257-1298, Doug Kline, Sempra Energy, (877) 340-8875, www.sempra.com, Financial Contact: Scott Tomayko, Sempra Energy, (877) 736-7727, investor@sempra.com