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<B><FONT SIZE=4><P ALIGN="CENTER">UNITED STATES</P>
<P ALIGN="CENTER">SECURITIES AND EXCHANGE COMMISSION</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">Washington, D.C. 20549</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
</FONT><FONT SIZE=4><P ALIGN="CENTER">FORM 8-K</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">CURRENT REPORT</P>
<P ALIGN="CENTER"></P>
</FONT><P ALIGN="CENTER">PURSUANT TO SECTION 13 OR 15(d) OF THE</P>
<P ALIGN="CENTER">SECURITIES EXCHANGE ACT OF 1934</P>
<FONT SIZE=4><P ALIGN="CENTER"></P>
</B><P ALIGN="CENTER">&nbsp;</P>
</FONT><B><FONT SIZE=2><P ALIGN="CENTER">Date of Report (Date of earliest event reported): November 7, 2002</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
</FONT><FONT SIZE=4><P ALIGN="CENTER">AGL RESOURCES INC.</P>
</B></FONT><FONT SIZE=2><P ALIGN="CENTER">(Exact Name of Registrant as Specified in Charter)</P>
<B><P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P></B></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=730>
<TR><TD WIDTH="35%" VALIGN="TOP" HEIGHT=20><DIR>

<B><FONT SIZE=2><P ALIGN="CENTER">Georgia</DIR>
</B></FONT></TD>
<TD WIDTH="33%" VALIGN="TOP" HEIGHT=20><DIR>

<B><FONT SIZE=2><P ALIGN="CENTER">1-14174</DIR>
</B></FONT></TD>
<TD WIDTH="33%" VALIGN="TOP" HEIGHT=20><DIR>

<B><FONT SIZE=2><P ALIGN="CENTER">58-2210952</DIR>
</B></FONT></TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP"><DIR>

<FONT SIZE=2><P ALIGN="CENTER">(State or Other Jurisdiction Of Incorporation</DIR>
</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP"><DIR>

<FONT SIZE=2><P ALIGN="CENTER">(Commission File No.)</DIR>
</FONT></TD>
<TD WIDTH="33%" VALIGN="TOP"><DIR>

<FONT SIZE=2><P ALIGN="CENTER">(IRS Employer Identification No.)</DIR>
</FONT></TD>
</TR>
</TABLE>
</CENTER></P>

<B><FONT SIZE=2><P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">817 West Peachtree Street, NW, Suite 1000, Atlanta, Georgia 30308</P></B></FONT>
<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=712>
<TR><TD WIDTH="50%" VALIGN="TOP"><DIR>

<FONT SIZE=2><P ALIGN="CENTER">(Address of Principal Executive Offices)</DIR>
</FONT></TD>
<TD WIDTH="50%" VALIGN="TOP"><DIR>

<FONT SIZE=2><P ALIGN="CENTER">(Zip Code)</DIR>
</FONT></TD>
</TR>
</TABLE>
</CENTER></P>

<B><FONT SIZE=2><P ALIGN="CENTER"></P>
</B><P ALIGN="CENTER">&nbsp;</P>
<B><P ALIGN="CENTER">(404) 584-9470</P>
</B><P ALIGN="CENTER">(Registrant's telephone number, including area code)</P>
<B><P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">Not Applicable</P>
</B><P ALIGN="CENTER">(Former name or former address, if changed since last report)</P>
<P ALIGN="CENTER"></P>
<P>&nbsp;</P>
<B><P>&nbsp;</P>
<P>Item 9. Regulation FD Disclosure</P>
</B><P>Materials discussed at the AGL Resources Inc. 2002 Analyst Conference to be held on November 6-8,2002.</P>
</FONT><B><P>Forward-Looking Statements</P>
</B>
<P>Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  The future results and securities values of AGL Resources and its subsidiaries may differ materially from those expressed in the forward-looking statements contained throughout these presentations and in documents filed with the Securities and Exchange Commission.  Many of the factors that will determine these results and values are beyond AGL Resources' ability to control or predict.  The statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital markets conditions; inflation rates; interest rates; energy markets; weather conditions; business and regulatory or legal decisions; the pace of deregulation of natural gas; the timing and success of business development efforts; and other uncertainties and risks.  You are cautioned not to put any undue reliance on any forward-looking statement, and to consult the company's periodic public SEC filings for other risks and factors that could materially impact the company's operations and financial results.</P>
<FONT SIZE=2>
</FONT><FONT SIZE=5><P>&nbsp;</P>
<P>Delivering Value</P>
</FONT>
<P>Paula G. Rosput</P>
<P>Chairman, President and CEO</P>
<P>AGL Resources</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>

<P>&nbsp;</P>
<P>Our Success Has Been Deliberate</P>
<P>[The following data is presented in graphic format]</P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=747>
<TR><TD WIDTH="21%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P ALIGN="RIGHT">Year-to-Date</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P ALIGN="RIGHT">Last Twelve Months</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P ALIGN="RIGHT">Trailing 24 Months</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P ALIGN="RIGHT">Trailing 36 Months</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>AGL Resources</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>6.4%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>13.0%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>16.6%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>34.5%</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>LDC Index</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(2.9)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>1.9%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>9.3%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>6.8%</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>S&amp;P 500</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(22.0)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(18.3)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(34.7)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(34.2)%</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>Large-cap LDC Index</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(5.2)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(1.0)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>5.1%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(0.9)%</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>Mid-cap LDC Index</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>6.0%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>10.3%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>27.5%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>24.4%</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP">
<FONT SIZE=1><P>Small-cap LDC Index</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(19.7)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(12.3)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(19.1)%</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP">
<FONT SIZE=1><P>(12.5)%</FONT></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=5>
<FONT SIZE=1><P>Data includes closing prices through November 1, 2002</FONT></TD>
</TR>
</TABLE>


<P>2</P>

<P>&nbsp;</P>
<P>A Multi-Year Plan That Features:</P>

<UL>
<LI>A fundamentals orientation</LI>
<LI>Management's value philosophy</LI>
<LI>Spectrum of  necessary skill sets</LI>
<LI>Discipline in execution</LI>
<LI>We like to "kick the tires"</LI></UL>


<P>3</P>

<P>&nbsp;</P>
<P>2002 Milestones</P>
<P>[The following data is presented in graphic format]</P>
<P>Improve earnings</P>
<P>Change the Regulatory Paradigm</P>
<P>Accelerate Telecom</P>

<P>Jan</P>

<UL>
<LI>AGLN AT&amp;T Deal Signed</LI></UL>


<P>April</P>

<UL>
<LI>1Q: $0.90 vs. $0.87 First Call</LI>
<LI>AGLC/GPSC establish PBR</LI></UL>


<P>May</P>

<UL>
<LI>Sequent one-year mark (3 Bcf/day)</LI>
<LI>Producer Services Initiated</LI></UL>


<P>June</P>

<UL>
<LI>Completed Atlanta network</LI></UL>


<P>July</P>

<UL>
<LI>2Q: $0.22 vs. $0.20 First Call</LI>
<LI>Credit Default avoided with merchants [Graphic indicates Jun-Oct+)</LI>
<LI>AGLN Emory deal signed</LI></UL>


<P>Aug</P>

<UL>
<LI>Credit Facility Closing</LI>
<LI>AGLN B of A deal signed</LI></UL>


<P>Sept</P>

<UL>
<LI>WNA Approved for VNG</LI>
<LI>AGLN Expands into:</LI></UL>


<UL>
<LI>Kansas City</LI>
<LI>St. Louis</LI>
<LI>Richmond</LI>
<LI>Phoenix</LI></UL>


<P>Oct</P>

<UL>
<LI>3Q: $0.17 vs. $0.14</LI></UL>


<P>4</P>

<P>&nbsp;</P>
<P>What Are The Fundamentals for 2003?</P>

<UL>
<LI>Pervasiveness of financial distress in the industry</LI>
<LI>Volatility of underlying commodity</LI>
<LI>Deepening governmental involvement</LI>
<LI>Understanding value cycle </LI>
<LI>Acquisition ambition tempered by value cycle realities</LI></UL>


<P>5</P>

<P>&nbsp;</P>
<P>Financial Distress in the Industry</P>
<P>[The following data is presented in graphic format]</P>
<P>Market Capitalization Changes (Last 12 Months)</P>
<P>RECENT CREDIT DOWNGRADES</P>
<P>Williams - July 2002 - outlook NEGATIVE</P>
<P>Dynegy - July 2002 - outlook NEGATIVE</P>
<P>Duke Energy - August 2002 - outlook STABLE</P>
<P>Aquila - September 2002 - outlook NEGATIVE</P>
<P>Mirant - October 2002 - outlook NEGATIVE</P>
<P>CenterPoint (Reliant) - November 2002 - outlook NEGATIVE</P>
<P>El Paso - October 2002 - outlook NEGATIVE</P>
<P>Energy East - March 2002 - outlook STABLE</P>
<P>Sempra Energy - March 2002 - outlook STABLE</P>
<P>UGI - September 2002 - outlook STABLE</P>
<P>PGL - September 2002 - outlook NEGATIVE</P>

<P>6</P>

<P>&nbsp;</P>
<P>Financial Distress In the Industry</P>
<P>In millions</P>
<I><P>As of 9/30/02</P></I>
<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=781>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P ALIGN="RIGHT">Gross Receivable</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P ALIGN="RIGHT">Gross Payable</TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=4>
<P>Receivables with netting agreements in place:</TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty is investment grade</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>$87.6</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>$75.8</TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty is non-investment grade</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>11.2</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>16.0</TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty has no external rating</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>2.0</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>13.6</TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=4>
<P>Receivables without netting agreements in place:</TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty is investment grade</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>6.2</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P>16.6</TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty is non-investment grade</TD>
<TD WIDTH="24%" VALIGN="TOP">
<P> - </TD>
<TD WIDTH="24%" VALIGN="TOP">
<P> - </TD>
</TR>
<TR><TD WIDTH="6%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="47%" VALIGN="TOP">
<P>Counterparty has no external rating</TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><P> - </U></TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><P>0.4</U></TD>
</TR>
<TR><TD WIDTH="53%" VALIGN="TOP" COLSPAN=2>
<P>Amount recorded on balance sheet</TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><P>$107.0</U></TD>
<TD WIDTH="24%" VALIGN="TOP">
<U><P>$122.4</U></TD>
</TR>
</TABLE>


<P>Credit support and netting are essential <I>in real time</P>
</I>
<P>7</P>

<P>Distress is Not Unique to Energy Industry</P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=2 WIDTH=734>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17><P></P></TD>
<TD WIDTH="25%" VALIGN="TOP" COLSPAN=2 BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Stock Price</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Shares</B></FONT></TD>
<TD WIDTH="28%" VALIGN="TOP" COLSPAN=2 BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Market Cap</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Value</B></FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Company</B></FONT></TD>
<TD WIDTH="25%" VALIGN="TOP" COLSPAN=2 BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">$/Share</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Outstanding </B></FONT></TD>
<TD WIDTH="28%" VALIGN="TOP" COLSPAN=2 BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">($ Billions)</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Degradation</B></FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17><P></P></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Jan-00</B></FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Recent</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">(Millions)</B></FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Jan-00</B></FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">Recent</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<B><FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">($ Billions)</B></FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Cisco</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">55.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">14.34</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">7,315 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">402.3</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">104.9 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">297.4</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Nortel</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">55.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">2.32</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">3,206 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">176.3</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">7.4 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">168.9</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Alcatel</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">40.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">7.07</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">1,231 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">49.2</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">8.7 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">40.5</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>JDS Uniphase</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">80.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">3.62</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">1,519 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">121.5</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">5.5 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">116.0</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Lucent</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">50.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">2.26</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">3,407 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">170.4</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">7.7 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">162.7</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Ericsson</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">15.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">1.52</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">8,059 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">120.9</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">12.2 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">108.6</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>WorldCom</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">60.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">0.09</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">2,963 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">177.8</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">0.3 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">177.5</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P>Nokia</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">42.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">21.50</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">4,737 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">199.0</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">101.8 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=17>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">97.1</FONT></TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P>Motorola</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">40.00</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">14.70</FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">2,267 </FONT></TD>
<TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">90.7</FONT></TD>
<TD WIDTH="13%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">33.3 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#ffffff" HEIGHT=18>
<FONT FACE="Arial" SIZE=2><P ALIGN="CENTER">57.4</FONT></TD>
</TR>
</TABLE>

<P>Over $1.2 Trillion of stockholders' equity lost in 30 months</P>

<P>8</P>

<P>&nbsp;</P>
<P>Volatility</P>
<P>[Graphic appears here]</P>

<UL>
<LI>Continue to seek regulatory partnerships to dampen effects</LI>
<LI>Recognize that longer-term business prospects lie in managing volatility, rather than retailing it</LI></UL>

<P>[Graphic appears here]</P>

<P>9</P>

<P>&nbsp;</P>
<P>Market Is Becoming More Peak Reliant</P>
<P>[Graphic appears here]</P>

<P>10</P>

<P>&nbsp;</P>
<P>Regulatory Environment</P>

<P>[Graphic appears here]</P>
<P>We continue to invest the resources to do the job right.</P>

<P>11</P>

<P>&nbsp;</P>
<P>[Graphic appears here]</P>

<P>12</P>

<P>Return on Invested Capital<BR>
<FONT SIZE=2>(Based on AGLR Core Earnings)</P>
</FONT>
<P>[Graphic appears here]</P>

<P>The challenge of moving a behemoth</P>

<P>13</P>

<P>&nbsp;</P>
<P>Valuations as Multiple of EBITDA</P>
<P>[The following data is presented in graphic format]</P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=352>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>El Paso/TPC</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>8.9X</TD>
</TR>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>Williams/Transco</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>8.3X</TD>
</TR>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>Mid-American/Kern River</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>7.1X</TD>
</TR>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>Mid-American/NNG</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>7.3X</TD>
</TR>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>Atmos/MS Valley</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>11.4X</TD>
</TR>
<TR><TD WIDTH="74%" VALIGN="TOP">
<P>Piedmont/NCNG</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>12.8X</TD>
</TR>
</TABLE>


<UL>
<LI>Recent decline in valuation from historical precedents</LI>
<LI>Recent pipeline deals acquired at 6.5x - 7.5x LTM EBITDA -- below historical pipeline range of around 8.0x</LI>
<LI>Strategic buyers must be able to make the multiples work!</LI></UL>


<P>14</P>

<P>&nbsp;</P>
<P>Proven Track Record in Consolidation</P>

<UL>
<LI>VNG accretive in nine months, using 100% debt</LI>
<LI>VNG scenarios at 40% equity financing</LI>
<LI>Equity will be a key ingredient in future transactions </LI></UL>


<P>15</P>

<P>&nbsp;</P>
<P>Matching Our Valuation to Likely Opportunities</P>
<P>[The following data is presented in graphic format]</P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=391>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>ATG</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>13.4X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>GAS</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>11.3X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>EAS</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>13.1X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>OKE</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>14.1X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>PGL</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>13.1X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>PNY</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>17.6X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>WGL</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>18.0X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>WGR</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>29.1X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>ATO</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>14.5X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>NJR</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>14.6X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>NWN</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>15.7X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>SUG</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>9.9X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>SWX</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>15.6X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>UGI</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>13.9X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>CGC</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>16.3X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>LG</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>17.1X</TD>
</TR>
<TR><TD WIDTH="35%" VALIGN="TOP">
<P>NUI</TD>
<TD WIDTH="65%" VALIGN="TOP">
<P>11.7X</TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P>Data includes closing prices through October 24, 2002</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
<P>16</P>

</FONT><P>&nbsp;</P>
<P>Strategy for 2003</P>

<UL>
<LI>Measurably improve return on invested capital (ROIC) in base business</LI>
<LI>Increase asset management business</LI>
<LI>Build repeatable multi-city telecom business</LI>
<LI>Execute on opportunities to take advantage of current industry distress</LI>
<LI>Enhance strength of balance sheet</LI></UL>


<P>17</P>

<B><FONT SIZE=5><P>&nbsp;</P>
<P>Financial Overview and Strategy</P>
</B></FONT>
<P>&nbsp;</P>
<P>Richard T. O'Brien</P>
<P>Executive Vice President</P>
<P>and Chief Financial Officer</P>
<P>AGL Resources</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>{AGL Resources logo appears hear}</P>

<B><P>Forward-Looking Statements</P>
</B>
<P>Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  The future results and securities values of AGL Resources and its subsidiaries may differ materially from those expressed in the forward-looking statements contained throughout these presentations and in documents filed with the Securities and Exchange Commission.  Many of the factors that will determine these results and values are beyond AGL Resources' ability to control or predict.  The statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital markets conditions; inflation rates; interest rates; energy markets; weather conditions; business and regulatory or legal decisions; the pace of deregulation of natural gas; the timing and success of business development efforts; and other uncertainties and risks.  You are cautioned not to put any undue reliance on any forward-looking statement, and to consult the company's periodic public SEC filings for other risks and factors that could materially impact the company's operations and financial results.</P>

<B><FONT SIZE=4><P>Financial Management Philosophy</P>


<UL>
</B></FONT><LI>Low-cost asset operator</LI>
<LI>Disciplined financial approach</LI>
<LI>No planes, executive loans, etc.</LI></UL>



<UL>
<LI>Attention to detail</LI>
<LI>Weekly operations and financial assessment</LI>
<LI>Monthly earnings and accounting reviews</LI>
<LI>Frequent strategic reviews and planning sessions</LI></UL>



<UL>
<LI>Risk management</LI>
<LI>Strong risk management capability in all business units</LI>
<LI>Maintain physical, asset-based approach to asset optimization efforts</LI></UL>



<UL>
<LI>Earnings visibility and transparency remain key financial goals for ATG</LI></UL>


<B><P>Third Quarter Financial Results</P>

</B><P>{bar graph depicting}</P>
<I><P>Earnings Per Share</P>

</I><P>2001 $0.09</P>
<P>2002 $0.17</P>

<U><P>Earnings Drivers</P>
</U><B><FONT SIZE=4>

<UL>
</B></FONT><LI>Strong wholesale services performance due to volatility</LI>
<LI>Improved year-over-year results from SouthStar</LI>
<LI>Increased revenues and lower expenses in Distribution Operations</LI>
<LI>Lower interest expense</LI></UL>


<P>&nbsp;</P>
<FONT SIZE=4><P>&nbsp;</P>
</FONT><B><P>YTD 2002 Financial Results</P>

</B><P>{bar graph depicting}</P>
<I><P>Earnings Per Share</P>
</I>
<P>2001 $1.22</P>
<P>2002 $1.28</P>

<U><P>Earnings Drivers</P>
</U>

<UL>
<LI>Lower utility O&amp;M, including depreciation</LI>
<LI>Higher utility revenues (pipeline replacement)</LI>
<LI>Improved contributions from SouthStar</LI>
<LI>Increased EBIT contribution from market opportunities at Sequent</LI>
<LI>Lower interest expense</LI></UL>


<P>&nbsp;</P>
<B><P>EBIT - 2002 vs. 2001 For Quarter Ended September 30 (in millions)</P>
</B>
<P>{waterfall graph appears here}</P>

<P>Prior Year $30.9</P>
<P>AMR ($6.4)</P>
<P>PY Corp SSE Res ($6.0)</P>
<P>Rate Settlement ($1.8)</P>
<P>VNG, CGC volumes ($1.4)</P>
<P>SSE Unbilled Issue $5.7</P>
<P>Wholesale $4.2</P>
<P>Corp. OH/Bad Debt $4.1</P>
<P>PY Etowah W/O $2.6</P>
<P>Pipeline Repl. Rev $2.4</P>
<P>Propane/Networks $2.2</P>
<P>Actual $36.0</P>

<B><P>EBIT - 2002 vs. 2001 For Nine Months Ended September 30 (in millions)</P>
</B>
<P>{waterfall graph appears here}</P>

<P>Prior Year $175.7</P>
<P>Utilipro gain ($10.9)</P>
<P>Corp. Reserves ($8.6)</P>
<P>AMR ($6.4)</P>
<P>PY Storage Adj. ($4.9)</P>
<P>VNG Weather ($3.5)</P>
<P>SouthStar $13.6</P>
<P>Lower DO O&amp;M $9.2</P>
<P>Pipeline Repl. $4.7</P>
<P>Lower Service Co. OH $4.2</P>
<P>PY Etowah W/O $2.2</P>
<P>Propane $1.6</P>
<P>Actual $176.5</P>

<P>&nbsp;</P>
<B><P>Cash Flow Projections (in millions of dollars)</P>
</B>
<P>{bar chart depicting Total Cash Outflow for Investing and Financing}</P>

<P>2002 </P>
<P>$361 Cash Inflow</P>
<P>$313 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)</P>

<P>2003</P>
<P>$320 Cash Inflow</P>
<P>$316 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)</P>

<P>2004 </P>
<P>$350 Cash Inflow</P>
<P>$331 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)</P>

<P>2005</P>
<P>$360 Cash Inflow</P>
<P>$338 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)</P>

<B><P>Cash Flow Strategy</P>
</B>

<UL>
<LI>Company will be cash positive by improving margins</LI>
<LI>Focus on capital efficiency and effectiveness</LI>
<LI>Improved processes around timing/amount of capital spending</LI>
<LI>Improve coverage ratios</LI>
<LI>Continuously improve cash forecasting processes and cash realizations from each business</LI></UL>


<P>&nbsp;</P>
<B><P>Secure Dividend</P>
</B>
<P>{Bar &amp; Line chart depicting Core EPS, DPS, and Payout Ratio}</P>

<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=773>
<TR><TD WIDTH="16%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 1997</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 1998</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 1999</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 2000</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 2001</TD>
<TD WIDTH="15%" VALIGN="TOP">
<P ALIGN="RIGHT">FY 2002F</TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP">
<P>Core EPS</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.37</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.56</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$0.91</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.24</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.50</TD>
<TD WIDTH="15%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.73-1.78</TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP">
<P>DPS</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
<TD WIDTH="15%" VALIGN="TOP">
<P ALIGN="RIGHT">$1.08</TD>
</TR>
<TR><TD WIDTH="16%" VALIGN="TOP">
<P>Payout Ratio</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">79%</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">70%</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">119%</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">87%</TD>
<TD WIDTH="14%" VALIGN="TOP">
<P ALIGN="RIGHT">72%</TD>
<TD WIDTH="15%" VALIGN="TOP">
<P ALIGN="RIGHT">62%</TD>
</TR>
</TABLE>


<P>&nbsp;</P>

<UL>
<LI>We are committed to the security of the dividend</LI>
<LI>Board continues to evaluate future dividend increase</LI></UL>


<P>&nbsp;</P>
<B><P>Earnings Guidance</P>
</B>

<UL>
<LI>2002</LI>
<LI>Revised guidance upward to $1.73 to $1.78 per share (from previous $1.65 to $1.70)</LI>
<LI>Improved expectations reflect strong 3Q and YTD performance</LI></UL>



<UL>
<LI>2003</LI>
<LI>Will provide an update in January after formal budgeting and planning process is complete and approved by the Board</LI></UL>


<P>&nbsp;</P>
<B><P>Achieving Size and Scale</P>
</B>

<UL>
<LI>Financial distress pervades the industry</LI>
<LI>Assets are beginning to be marketed and change hands</LI>
<LI>Recent decline in valuations</LI>
<LI>Focus on LDC and/or pipeline assets in the Southeast</LI>
<LI>Must meet stringent investment criteria</LI>
<LI>Sometimes the deal you don't do is as important as the one you do</LI></UL>


<P>&nbsp;</P>
<B><P>Operational and strategic options using an analytical framework we continue to develop</P>
</B>
<U><P>Current Asset Portfolio</P>

<UL>
</U><LI>Financial pro forma</LI>
<LI>How would new assets fit in?</LI></UL>


<U><P>External Market Conditions</P>

<UL>
</U><LI>What assets are available and attractively priced?</LI>
<LI>Synergies from combination</LI></UL>


<U><P>Internal Considerations</P>

<UL>
</U><LI>Balance sheet issues</LI>
<LI>EPS growth targets</LI>
<LI>Management capabilities</LI></UL>


<U><P>Decision and Financial Analysis Framework</P>

<UL>
</U><LI>Identify internal improvements</LI>
<LI>Prioritize improvement initiatives</LI>
<LI>Screen opportunities</LI>
<LI>Balance sheet considerations</LI></UL>


<U><P>Prioritized Strategic Options</P>

<UL>
</U><LI>Internal Options</LI>
<LI>Benchmark to others</LI>
<LI>Regulatory framework</LI></UL>


<UL>
<LI>External growth</LI>
<LI>Divest/acquire</LI></UL>


<B><P>Approach Business as Portfolio of Opportunities - Buy or Sell</P>
</B>
<P>&nbsp;</P>
<B><P>A Unique Investment Opportunity</P>


<UL>
</B><LI>Premier LDC assets with stable cash flows</LI>
<LI>Reasonable pace of growth in developing non-utility businesses to complement utility earnings</LI>
<LI>Strong, investment-grade credit</LI>
<LI>Attractive dividend yield</LI>
<LI>Improving balance sheet</LI>
<LI>Strong management team that delivers on promises</LI>
<LI>Continuing focus on cost containment and improving return on invested capital</LI>
<LI>Proven track record of organic growth and acquisition consolidation</LI>
<LI>Acquisition upside potential</LI>
<LI>Trade at a discount to peer group</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<FONT SIZE=5><P>Delivering Value<BR>
</FONT><FONT SIZE=2>through Distribution &amp; Pipeline Operations</P>

</FONT><P>Kevin P. Madden</P>
<P>Executive Vice President</P>
<P>AGL Resources</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>
<FONT SIZE=2>
<P>[AGL Resources logo appears here]</P>

</FONT><P>&nbsp;</P>
<P>&nbsp;</P>
<P>Where We Are</P>


<UL>
<LI>Fundamentals of the Business</LI>
<LI>Review of 2002 Goals and Accomplishments</LI>
<LI>2002 Financial Results</LI>
<LI>Strategic Thinking</LI>
<LI>What to Expect in 2003</LI>
<LI>Appendix  (Supplemental Data)</LI></UL>


<P>2</P>

<P>&nbsp;</P>
<P>Fundamentals of the Business</P>


<UL>
<LI>Managing Customer Growth</LI>
<LI>Managing Capital Deployment</LI>
<LI>Changing the Regulatory Paradigm</LI></UL>


<P>3</P>

<P>&nbsp;</P>
<P>Managing Customer Growth </P>
<FONT SIZE=2><P>(All Utilities Combined)</P>
</FONT>
<P>[Graphic appears here - depicts customer count 1995-2002]</P>

<P>4</P>

<P>Managing Our Customer Growth</P>

<UL>
<LI>Regulated Provider</LI>
<LI>Multi-family homes initiatives</LI>
<LI>Working with developers</LI>
<LI>Line extension policies</LI></UL>

<P>5</P>

<P>Managing Capital Deployment</P>

<P>[Graphic depicts capital expenditures expected for FY02 and FY03 broken down into the following categories:  Environmental Response Cost, Pipeline Replacement Program, Distribution/AGLC, Distribution/VNG, IS/T, and Other]</P>
<P>FY 02 Expected is actual at 9/30/02 plus anticipated for 4th quarter</P>

<P>6</P>

<P>&nbsp;</P>
<P>Managing Capital Deployment</P>

<P>Construction Cost Management</P>
<P>[The following data appears in graphic format]</P>
<TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=630>
<TR><TD WIDTH="29%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="71%" VALIGN="TOP" COLSPAN=4>
<P ALIGN="CENTER">Expansion Cost Per Foot of Main</TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P ALIGN="CENTER">1999</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P ALIGN="CENTER">2000</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P ALIGN="CENTER">2001</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P ALIGN="CENTER">2002</TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">
<P>AGLR</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$5.90</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$5.29</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$5.95</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$5.41</TD>
</TR>
<TR><TD WIDTH="29%" VALIGN="TOP">
<P>Benchmark Median</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$9.52</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$12.44</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>$13.07</TD>
<TD WIDTH="18%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>


<P>7</P>

<P>&nbsp;</P>
<P>Changing the Regulatory Paradigm</P>


<UL>
<LI>AGLC - Performance Based Ratemaking</LI></UL>


<UL>
<FONT SIZE=2><LI>Allows for retention of portion of increased earnings resulting from efficiencies and growth</LI>
<LI>Reduces regulatory uncertainty for 3 years</LI>
<LI>Maintains Straight Fixed Variable (SFV) rate design</FONT>  </LI></UL>


<UL>
<LI>VNG - Weather Normalization</LI></UL>


<UL>
<FONT SIZE=2><LI>Protects earnings from asymmetric effect of weather</LI>
<LI>Provides price stability for consumers</LI></UL>


<UL>
</FONT><LI>CGC - Fixed Portion of the Bill</LI></UL>


<UL>
<FONT SIZE=2><LI>Provides certainty and stability for consumers </LI>
<LI>Levels revenue stream through-out the year</LI></UL>

</FONT>
<P>8</P>

<P>&nbsp;</P>
<P>Review of 2002 Goals<BR>
<FONT SIZE=2>We deliver what we promise. . . </P>


<UL>
</FONT><LI>Increase Earnings</LI>
<LI>Georgia</LI></UL>


<UL>
<FONT SIZE=2><LI>Performance Based Rates (PBR)</LI></UL>


<UL>
</FONT><LI>Virginia</LI></UL>


<UL>
<FONT SIZE=2><LI>Weather Normalization (WNA)</LI></UL>


<UL>
</FONT><LI>Tennessee</LI></UL>


<UL>
<FONT SIZE=2><LI>Rate Stabilization</LI>
<LI>Utilization of LNG Facilities</LI></UL>


<P>9</P>
</FONT>
<P>2002 Business Results</P>


<UL>
<LI>EBIT</LI>
<LI>Jurisdictional Rates of Return</LI>
<LI>AGLC Performance Based Rates</LI>
<LI>Classification of Net Assets</LI>
<LI>Cost per Customer</LI></UL>


<P>10</P>

<P>&nbsp;</P>
<P>Comparison of EBIT <BR>
Projected 2002 vs 2001</P>

<P>[Graphic depicts the following information]</P>

<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=511>
<TR><TD VALIGN="TOP" COLSPAN=3>
<P ALIGN="CENTER">$ in Millions</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P ALIGN="CENTER">CY01</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P ALIGN="CENTER">CY02</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>AGLC</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>167.1</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>169.2</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>VNG</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>35.3</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>42.7</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>CGC</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>10.8</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>12.8</TD>
</TR>
</TABLE>
</P>


<P>11</P>

<P>&nbsp;</P>
<P>Authorized Versus Actual Returns</P>

<P>[The following information is presented in graphic format]</P>
<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=553>
<TR><TD VALIGN="TOP" COLSPAN=3>
<P ALIGN="CENTER">AGL Resources Utility Operations</P>
<P ALIGN="CENTER">Return on Equity 12 Months Ended September 30, 2002</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="67%" VALIGN="TOP" COLSPAN=2>
<FONT SIZE=2><P ALIGN="CENTER">Percent of Return</FONT></TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P ALIGN="CENTER">Authorized</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P ALIGN="CENTER">Actual</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="MIDDLE" ROWSPAN=2>
<P>AGLC</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>12.00 (1)</TD>
<TD WIDTH="33%" VALIGN="MIDDLE" ROWSPAN=2>
<P>11.85 (2)</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>11.00 (1)</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>CGC</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>11.06</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>10.53</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">
<P>VNG</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>10.90</TD>
<TD WIDTH="33%" VALIGN="TOP">
<P>8.73 (3)</TD>
</TR>
</TABLE>
</P>
<DIR>
<DIR>

<I><FONT SIZE=2><P>(1)  The authorized ROE is 11.00%.  The top of the earnings band is 12.00%.  The Company can also include 1/2 of VNG Synergies in calculating the return prior to sharing.  </P>
<P>(2)  Represents 5 months under new rates and 7 months under previous rates.</P>
<P>(3)  Based on actual weather.</P>
</I></FONT></DIR>
</DIR>

<P>12</P>

<P>AGLC Performance Based Rates</P>

<P>[Graphic depicts projected Return on Equity for 2002-2005 assuming 1% growth in Revenue and 0% growth in O&amp;M and projected Return on Equity for 2002-2005 assuming 1.5% growth in Revenue and 0% growth in O&amp;M]</P>

<P>13</P>

<P>&nbsp;</P>
<P>Classification of Net Assets</P>
<P>(as of September 30, 2002)</P>

<P>[Graphic depicts assets for AGLC, VNG, CGC and Total broken down into the following categories:  Rate Base, PRP Assets, ERC Assets, and Other]</P>

<P>14</P>

<P>&nbsp;</P>
<P>O &amp; M per Customer <BR>
Projected 2002 vs 2001</P>

<P>[Graphic depicts projected 2002 and 2001 O&amp;M per Customer for AGLC, VNG and CGC]</P>

<P>15</P>

<P>&nbsp;</P>
<P>Strategic Thinking</P>

<P>Peaking - Growing Peak Day Requirement</P>

<P>[Graphic appears here]</P>

<P>16</P>

<P>&nbsp;</P>
<P>AGLR Peaking Leadership Position</P>


<UL>
<LI>Customer needs shifting to peaking</LI>
<LI>Leverage our market expertise to capitalize on the shifting needs</LI>
<LI>Paradigm shift in meeting deliverability by creating options to traditional upstream transport and storage contracts</LI>
<LI>Paradigm shift in solving localized pressure issues; reduces captive investments</LI></UL>


<P>[Map "Existing AGL LNG Plants" appears here]</P>

<P>17</P>

<P>Southeast Pipeline Infrastructure</P>


<UL>
<LI>Cypress - Project on hold</LI>
<LI>Gulf Pines - Project on hold</LI>
<LI>Southeastern Pipeline constraints will lead to bottlenecks and opportunities</LI>
<LI>AGLR infrastructure unique in the Southeast</LI></UL>


<P>[Map "Proposed AGLR Pipeline" appears here]</P>

<P>18</P>

<P>&nbsp;</P>
<P>VNG Pipeline Infrastructure</P>


<UL>
<LI>Columbia's Homestead (southern zone) pipeline construction on hold</LI>
<LI>Joint-Use-Pipeline (JUP) strategically located to provide deliverability to five parties (Florida Power, Virginia Power, City of Richmond, Columbia Gas of Va, and VNG)</LI>
<LI>Anticipated supply constraints in the VNG "southern zone" in 2005</LI></UL>


<P>[Map appears here]</P>

<P>19</P>

<P>&nbsp;</P>
<P>Final Observations:  What to Expect in 2003</P>


<UL>
<LI>Stability through regulatory compact</LI>
<LI>Capital deployment</LI></UL>


<UL>
<FONT SIZE=2><LI>Focus our business where we make our greatest return</LI>
<LI>Drilling down on capital</FONT> </LI></UL>


<UL>
<LI>Working to achieve authorized returns and share benefits with customers</LI>
<LI>Continuing opportunities to improve service and develop wholesale asset opportunities</LI></UL>


<P>20</P>

<P>&nbsp;</P>
<P>Appendix   <BR>
(Supplemental Data)</P>


<UL>
<LI>Consolidating Balance Sheets</LI>
<LI>Consolidating Income Statement</LI>
<LI>Components of Rate Base</LI></UL>


<P>21</P>

<P>&nbsp;</P>
<P>Consolidating Balance Sheet </P>
<FONT SIZE=2><P>at September 30, 2002</P>
</FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=2 WIDTH=812>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P ALIGN="CENTER">Distribution Segment</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P ALIGN="CENTER">AGLC</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P ALIGN="CENTER">VNG</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P ALIGN="CENTER">CGC</B></FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=19>
<B><U><FONT SIZE=2><P>ASSETS</B></U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=19><P></P></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Current Assets</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>212,943,869 </FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>97,584,052 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>73,137,694 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>42,222,122 </FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Property, Plant &amp; Equipment</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>2,046,505,669 </FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>1,580,719,446 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>368,098,358 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>97,687,864 </FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Deferred Debits &amp; Other Assets</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>864,239,689 </FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>681,198,010 </FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>181,414,335 </FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>1,627,344 </FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>TOTAL ASSETS</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$3,123,689,227</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$2,359,501,508</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$622,650,388</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$141,537,331 </B></FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=21><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=21><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=21><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21><P></P></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<B><U><FONT SIZE=2><P>LIABILITIES</B></U></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Current Liabilities</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(284,200,693)</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(230,554,892)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(33,400,826)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(20,244,975)</FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Accumulated Deferred Income Taxes</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(319,241,393)</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(292,459,992)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(13,767,417)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(13,013,984)</FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Long-Term Liabilities/Deferred Credits</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(616,619,670)</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(603,118,823)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(13,982,293)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>481,446 </FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Capitalization</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(1,903,627,471)</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(1,233,367,802)</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(561,499,850)</FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(108,759,819)</FONT></TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>TOTAL LIABILITIES</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$(3,123,689,227)</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$(2,359,501,508)</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$(622,650,388)</B></FONT></TD>
<TD WIDTH="17%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$(141,537,331)</B></FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
<P>22</P>

</FONT><P>&nbsp;</P>
<P>Consolidating Income Statement<BR>
<FONT SIZE=2>Twelve Months Ended 9/30/02</P>
</FONT>
<TABLE BORDER CELLSPACING=1 CELLPADDING=2 WIDTH=714>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=41><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=41>
<B><FONT SIZE=2><P ALIGN="CENTER">Distribution Segment</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=41>
<B><FONT SIZE=2><P ALIGN="CENTER">AGLC</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=41>
<B><FONT SIZE=2><P ALIGN="CENTER">VNG</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=41>
<B><FONT SIZE=2><P ALIGN="CENTER">CGC</B></FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=19><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=19><P></P></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Revenue</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>797,142,328</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>519,924,488</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>209,748,067</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>67,469,773</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Cost of Sales</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>226,292,360</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>78,567,355</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>110,138,981</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>37,586,024</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>Operating Margin</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>570,849,968</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>441,357,133</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>99,609,086</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>29,883,749</B></FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>O&amp;M Expenses</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>250,886,155</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>198,007,445</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>42,818,847</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>10,059,863</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Other Expenses</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>106,831,716</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>79,406,133</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>19,706,705</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>7,718,878</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>Operating Income</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>213,132,097</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>163,943,555</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>37,083,534</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>12,105,008</B></FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Other Income</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>10,648,541</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>10,241,726</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>(103,651)</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>510,466</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>EBIT</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>223,780,639</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>174,185,281</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>36,979,883</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<B><FONT SIZE=2><P>12,615,475</B></FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20><P></P></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Interest Expense</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>50,516,089</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>42,034,493</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>8,348,650</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>132,946</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>Income Taxes</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>64,645,667</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>49,498,067</FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>10,219,460</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=20>
<FONT SIZE=2><P>4,928,140</FONT></TD>
</TR>
<TR><TD WIDTH="21%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>NET INCOME</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$108,618,883</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$82,652,721</B></FONT></TD>
<TD WIDTH="20%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$18,411,773</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=21>
<B><FONT SIZE=2><P>$7,554,389</B></FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2>
<P>23</P>

<P>&nbsp;</P>
</FONT><P>Components of Rate Base</P>

<FONT SIZE=2><P>AGL Resources Distribution Operations<BR>
Major Common Elements of Rate Base<BR>
12 Months Ended September 30, 2002 <I>(1)</I><BR>
(Millions)</P></FONT>
<P ALIGN="RIGHT"><TABLE BORDER CELLSPACING=1 CELLPADDING=2 WIDTH=769>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P ALIGN="CENTER">AGLC</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P ALIGN="CENTER">CGC</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P ALIGN="CENTER">VNG</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P ALIGN="CENTER">Distribution Operations Total</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22><P></P></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP" COLSPAN=2 HEIGHT=22>
<FONT SIZE=2><P>Utility Plant</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>2,276.9</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>151.6</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>524.3</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>2,952.9</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP" COLSPAN=2 HEIGHT=22>
<FONT SIZE=2><P>Less:</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22><P></P></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>Accumulated Provision for Depreciation</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>795.7</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>58.4</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>169.0</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>1,023.2</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>Contributions in Aid of Construction</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>47.2</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>2.2</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>-</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>49.4</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>Accumulated Deferred Income Taxes</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>246.1</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>9.0</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>3.9</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>259.0</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=22><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>Other</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>3.0</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>2.6</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>9.9</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>15.5</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP" COLSPAN=2 HEIGHT=22>
<FONT SIZE=2><P>Balance</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>1,185.1</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>79.4</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>341.4</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>1,605.9</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP" COLSPAN=2 HEIGHT=22>
<FONT SIZE=2><P>Cash Working Capital</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>(58.0)</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>16.1</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>10.2</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=22>
<FONT SIZE=2><P>(31.7)</FONT></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP" COLSPAN=2 HEIGHT=36>
<FONT SIZE=2><P>Total Rate Base</FONT></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=36>
<FONT SIZE=2><P>1,127.1</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=36>
<FONT SIZE=2><P>95.5</FONT></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=36>
<FONT SIZE=2><P>351.6</FONT></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=36>
<FONT SIZE=2><P>1,574.2</FONT></TD>
</TR>
<TR><TD WIDTH="3%" VALIGN="TOP" HEIGHT=23><P></P></TD>
<TD WIDTH="46%" VALIGN="TOP" HEIGHT=23><P></P></TD>
<TD WIDTH="11%" VALIGN="TOP" HEIGHT=23><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=23><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=23><P></P></TD>
<TD WIDTH="15%" VALIGN="TOP" HEIGHT=23><P></P></TD>
</TR>
<TR><TD VALIGN="TOP" COLSPAN=6 HEIGHT=23>
<I><FONT FACE="Arial" SIZE=1><P>(1)  Averaging the average of 12 months of rate base balances results in an average amount which is less than the period end balances.</I></FONT></TD>
</TR>
</TABLE>
</P>


<P>24</P>

<P>&nbsp;</P>
<FONT SIZE=5><P>Delivering Value</P>
</FONT><FONT SIZE=2><P>through Wholesale Services</P>

</FONT><P>Robert M. Flavin</P>
<P>Dana A. Grams</P>
<P>Patrick J. Strange</P>
<P>Sequent Energy Management</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>

</FONT><P>&nbsp;</P>
<FONT SIZE=4><P>Sequent Overview</P>
</FONT><FONT SIZE=2>
</FONT><P>Robert M. Flavin</P>
<P>Executive Vice President</P>
<P>Sequent Energy Management</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>
</FONT>
<P>&nbsp;</P>
<P>What a Difference a Year Makes...</P>

<UL>
<LI>Volatility</LI>
<LI>Competition</LI>
<LI>Credit</LI>
<LI>Regulatory Environment</LI></UL>


<P>3</P>

<P>&nbsp;</P>
<P>Merchant Energy Markets: <BR>
What's the Same?<BR>
<I>The Need for a Middle Man</P>
</I>

<UL>
<LI>Markets are very complex</LI>
<LI>Relationships are important</LI>
<LI>Supply and transportation balancing</LI>
<LI>Credit judgment</LI>
<LI>Continuing demand for services</LI></UL>


<P>4</P>

<P>Merchant Energy Markets: <BR>
What's Different?</P>


<UL>
<LI>Markets are more available</LI>
<LI>Margins are better</LI>
<LI>More room to grow</LI>
<LI>Greater available talent pool</LI>
<LI>Positive effects of volatility</LI></UL>


<P>Events have vindicated our strategy</P>

<P>5</P>

<P>&nbsp;</P>
<P>AGLR/Sequent's Approach</P>

<P>What We Do</P>

<UL>
<FONT SIZE=2><LI>Based on assets</LI>
<LI>Focused on specific geographies</LI>
<LI>Strong relationships</LI>
<LI>Utility empathy</LI>
<LI>Good corporate discipline</LI></UL>

</FONT>
<P>What We Don't Do</P>

<UL>
<FONT SIZE=2><LI>Pure speculation</LI>
<LI>Round trip trades</LI>
<LI>Have long-dated mark-to-model accounting</LI></UL>

</FONT>
<P>6</P>

<P>&nbsp;</P>
<P>Sequent's Business Infrastructure</P>

<P>[Graphic depicts Sequent's office structure]</P>


<UL>
<LI>Front Office:  responsible for pricing, marketing, trade origination/capture, and scheduling.</LI>
<LI>Middle Office:  responsible for trade support, trade confirmation, contract administration, portfolio validation, and policy compliance.</LI>
<LI>Back Office:  responsible for management reporting, trade settlement, and accounting.</LI></UL>


<P>7</P>

<FONT SIZE=4><P>Asset Management Activities</P>
</FONT>
<P>Dana A. Grams</P>
<P>Vice President Asset Management</P>
<P>Sequent Energy Management</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>

</FONT><P>&nbsp;</P>
<P>Sequent Asset <BR>
Management Activities</P>


<UL>
<LI>Transportation and Logistics (place)</LI>
<LI>Storage (time)</LI>
<LI>Supply and Distribution</LI>
<LI>Services</LI></UL>


<P>9</P>

<P>&nbsp;</P>
<P>Wholesale Market Hubs</P>

<P>[Map appears here]</P>

<P>10</P>

<P>&nbsp;</P>
<P>[Map appears here]</P>

<P>11</P>

<P>&nbsp;</P>
<P>Futures Pricing</P>
<P>NYMEX Natural Gas</P>

<P>[Graphic appears here]</P>

<P>12</P>

<P>&nbsp;</P>
<P>Futures Pricing</P>
<P>NYMEX Natural Gas</P>

<P>[Graphic appears here]</P>

<P>13</P>

<P>&nbsp;</P>
<P>Futures Pricing</P>
<P>NYMEX Natural Gas</P>

<P>[Graphic appears here]</P>

<P>14</P>

<P>&nbsp;</P>
<P>Typical Example of </P>
<P>Storage Arbitrage*</P>


<UL>
<LI>Inject Gas into storage in May</LI>
<LI>Withdraw Gas and Sell to Market in January</LI></UL>


<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=406>
<TR><TD WIDTH="61%" VALIGN="TOP">
<U><P>Arbitrage</U></TD>
<TD WIDTH="39%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>May 02 NYMEX</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$3.00</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>May 02 Physical Basis</TD>
<TD WIDTH="39%" VALIGN="TOP">
<U><P>-.03</U></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$2.97</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="39%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>January 03 NYMEX</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$3.80</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>January 03 Physical Basis</TD>
<TD WIDTH="39%" VALIGN="TOP">
<U><P>-.03</U></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$3.77</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="39%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Margin&#9;</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$0.80</TD>
</TR>
</TABLE>
</P>


<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=405>
<TR><TD WIDTH="61%" VALIGN="TOP">
<U><P>Cost and Fees</U></TD>
<TD WIDTH="39%" VALIGN="TOP">
<P ALIGN="CENTER">$/MMBtu</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Transportation to Storage</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$0.07</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Injection Fee</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$0.10</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Withdrawal Fee</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$0.05</TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Time Value of Money</TD>
<TD WIDTH="39%" VALIGN="TOP">
<U><P>$0.12</U></TD>
</TR>
<TR><TD WIDTH="61%" VALIGN="TOP">
<P>Total Costs</TD>
<TD WIDTH="39%" VALIGN="TOP">
<P>$0.34</TD>
</TR>
</TABLE>
</P>


<P>*Not differentiated by jurisdiction</P>

<P>15</P>

<P>&nbsp;</P>
<FONT SIZE=4><P>Gas Supply and Distribution</P>
</FONT>
<P>Patrick J. Strange</P>
<P>Vice President Supply and Distribution</P>
<P>Sequent Energy Management</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>
</FONT>
<P>Sequent's Supply and Distribution Activities</P>


<UL>
<LI>Gas Supply (acquisition/aggregation)</LI>
<LI>Transportation and Storage</LI>
<LI>Marketing</LI></UL>


<P>17</P>

<P>&nbsp;</P>
<P>Sequent Counterparties</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=738>
<TR><TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>Producers</UL>
</TD>
<TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>Pipelines</UL>
</TD>
<TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>Markets</UL>
</TD>
</TR>
<TR><TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>Adams Resources</LI>
<LI>Amerada Hess</LI>
<LI>Petrofina</LI>
<LI>Anadarko</LI>
<LI>Bass Enterprises</LI>
<LI>BP Amoco</LI>
<LI>Conoco Phillips</LI>
<LI>ExxonMobil</LI>
<LI>Houston Exploration</LI>
<LI>Hunt Exploration</LI>
<LI>Swift Energy</LI>
<LI>Total Fina</LI>
<LI>Unocal</LI></UL>

</TD>
<TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>ANR</LI>
<LI>Bridgeline</LI>
<LI>Centerpoint</LI>
<LI>Columbia Gas</LI>
<LI>Columbia Gulf</LI>
<LI>Destin</LI>
<LI>Dominion Transmission</LI>
<LI>East Tennessee</LI>
<LI>Florida Gas</LI>
<LI>Gulf South</LI>
<LI>Kinder Morgan Texas</LI>
<LI>Tennessee Gas</LI>
<LI>Texas Gas</LI>
<LI>Transco</LI></UL>


<UL>
<LI>Southern Natural</UL>
</TD>
<TD WIDTH="33%" VALIGN="TOP">

<UL>
<LI>Alabama Gas Corp.</LI>
<LI>Ashland</LI>
<LI>Baltimore Gas &amp; Electric</LI>
<LI>Bethlehem Steel</LI>
<LI>Carolina Power &amp; Light</LI>
<LI>Columbia Gas</LI>
<LI>Delmarva</LI>
<LI>Entergy</LI>
<LI>Florida Power</LI>
<LI>International Paper</LI>
<LI>Michigan Consolidated</LI>
<LI>New Jersey Natural</LI>
<LI>PCS Nitrogen</LI>
<LI>SCANA</LI></UL>

</TD>
</TR>
</TABLE>

<P>&nbsp;</P>
<P>18</P>

<P>&nbsp;</P>
<P>Natural Gas Storage Is An Important Part of Our Business</P>

<P>[Map appears here]</P>

<P>19</P>

<P>&nbsp;</P>
<P>Transportation Logistics</P>

<P>"The sum of the parts is greater than the whole"</P>

<P>[Map appears here]</P>

<P>20</P>

<P>&nbsp;</P>
<FONT SIZE=4><P>Looking Forward</P>
</FONT>
<P>Robert M. Flavin</P>
<P>Executive Vice President</P>
<P>Sequent Energy Management</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>
</FONT>
<P>&nbsp;</P>
<P>Future Directions: <BR>
Business Development</P>


<UL>
<LI>Filling the void for customers</LI>
<LI>Deepening contractual asset base</LI>
<LI>Developing relationships with strong counterparties</LI>
<LI>Maintaining the right risk/return profile</LI></UL>


<P>22</P>

<P>&nbsp;</P>
<P>Formula for Success: <BR>
Industry Factors to Watch</P>


<UL>
<LI>Value and volatility of natural gas</LI></UL>


<UL>
<FONT SIZE=2><LI>Natural gas supply</LI>
<LI>Seasonality (hot summer/cold winters)</LI>
<LI>Market disruptions (hurricanes)</LI></UL>


<UL>
</FONT><LI>Market dislocations</LI>
<LI>Price and volatility of competitive fuels</LI></UL>


<P>23</P>

<P>&nbsp;</P>
<P>Formula for Success: <BR>
Financial Resources</P>


<UL>
<LI>Required working capital</LI></UL>


<UL>
<FONT SIZE=2><LI>Provided by cash flow much of the year or short term borrowings from AGLR under money pool arrangement</LI>
<LI>$15 million Bank One line of credit covers margining on the commodity futures exchange</LI>
<LI>Typical month's working capital is minimal</LI></UL>


<UL>
</FONT><LI>Fixed capital deployment</LI></UL>


<UL>
<FONT SIZE=2><LI>Depreciation and Amortized items "negligible" at approximately $3 million</LI></UL>

</FONT>
<P>24</P>

<P>Wholesale Services Receivables/Payables</P>
<FONT SIZE=2></FONT>
<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=682>
<TR><TD WIDTH="52%" VALIGN="TOP">
<I><FONT SIZE=2><P>In millions</I></FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Gross Receivable</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P ALIGN="CENTER">Gross Payable</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Contracts with netting agreements in place:</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterparty is investment grade</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>$87.6</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>$75.8</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterpart is non-investment grade</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>11.2</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>16.0</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterparty has no external rating</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>2.0</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>13.6</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Contracts without netting agreements in place:</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="24%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterparty is investment grade</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>6.2</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>16.6</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterpart is non-investment grade</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>-</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>-</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Counterparty has no external rating</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>-</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>0.4</FONT></TD>
</TR>
<TR><TD WIDTH="52%" VALIGN="TOP">
<FONT SIZE=2><P>Amount recorded on balance sheet</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>107.0</FONT></TD>
<TD WIDTH="24%" VALIGN="TOP">
<FONT SIZE=2><P>$122.4</FONT></TD>
</TR>
</TABLE>
</P>

<FONT SIZE=2>
<I><P>As of 09/30/02</P>
</I>
<P>25</P>

</FONT><P>&nbsp;</P>
<P>Formula for Success: <BR>
Financial Resources</P>


<UL>
<LI>Required working capital</LI></UL>


<UL>
<LI>Provided by cash flow much of the year or short term borrowings from AGLR under money pool arrangement</LI>
<LI>$15 million Bank One line of credit covers margining on the commodity futures exchange</LI>
<LI>Typical month's working capital is minimal</LI></UL>


<UL>
<LI>Fixed capital deployment</LI></UL>


<UL>
<LI>Depreciation and Amortized items "negligible" at approximately $3 million</LI></UL>


<P>26</P>

<P>&nbsp;</P>
<P>Wholesale Services </P>
<P>Financial Performance</P>

<P ALIGN="LEFT"><TABLE BORDER CELLSPACING=1 CELLPADDING=9 WIDTH=712>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>(in millions $)</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P ALIGN="CENTER">Total 2001</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P ALIGN="CENTER">First 9 Months 2002</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P ALIGN="CENTER">Combined</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Gross Margin</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>17.6</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>14.9</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>32.5</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Operation Expenses</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>8.8</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>9.8</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>18.6</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Taxes other than income</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>0.1</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>0.3</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>0.4</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Total Operating Exp</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>9.0</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>10.1</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>19.1</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Write off of Etowah LNG</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>-2.6</TD>
<TD WIDTH="26%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>-2.6</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>Other Income</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>0.4</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>0.0</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>0.4</TD>
</TR>
<TR><TD WIDTH="34%" VALIGN="TOP">
<P>EBIT</TD>
<TD WIDTH="18%" VALIGN="TOP">
<P>6.4</TD>
<TD WIDTH="26%" VALIGN="TOP">
<P>4.8</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>11.2</TD>
</TR>
</TABLE>
</P>


<P>27</P>

<P>&nbsp;</P>
<P>Summary</P>


<UL>
<LI>We focus on business fundamentals.  </LI>
<LI>Ours is a simpler business than those who have gone before us, not glamorous or risky.</LI>
<LI>We will grow it consistent with market timing and our ability to maintain a strong control environment.</LI></UL>


<P>28</P>

<P>&nbsp;</P>
<B><FONT SIZE=4><P>&nbsp;</P>
</FONT><FONT SIZE=5><P>Delivering Value through Risk Management</P>
</B></FONT>
<P>Gene Rozgonyi</P>
<P>Chief Risk Officer</P>
<P>AGL Resources</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>{AGL Resources logo appears here}</P>

<P>&nbsp;</P>
<B><P>Enterprise Risk</P>
</B>
<P>Board Level Finance and Risk Management Committee</P>


<UL>

<UL>
<LI>Executive Risk Management Committee</LI></UL>
</UL>



<UL>

<UL>
<LI>Chief Risk Officer</LI></UL>
</UL>


<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">Risk Observation, Reporting, &amp; Recommendations</P>
<P ALIGN="CENTER"></P>
<P ALIGN="CENTER">Weather</P>
<P ALIGN="CENTER">Commodity</P>
<P ALIGN="CENTER">Insurance</P>
<P ALIGN="CENTER">Treasury</P>
<P ALIGN="CENTER">Regulatory</P>
<P ALIGN="CENTER">Operational</P>
<P ALIGN="CENTER">Credit</P>
<P ALIGN="CENTER"></P>
<P>&nbsp;</P>
<B><P>Enterprise Risk</P>


<UL>
</B><LI>Expansive - The enterprise risk initiatives incorporate the efforts of traditional insurance, credit, capital allocation, quality movements, safety, and trading and marketing risk management.</LI>
<LI>Systematic - AGLR's Enterprise risk efforts are conducted thoughtfully and methodically throughout the corporation</LI>
<LI>Specific - The unique nature of each risk is addressed, understood, and managed to provide meaningful information.</LI>
<LI>Awareness - A risk aware culture is promoted in all business units.</LI>
<LI>Evolving - The risk management framework acts to support the continued development of metrics, analysis and observations.</LI>
<LI>Value - The enterprise risk efforts preserve and enhance value by effectively assessing and mitigating factors that affect the activities and earnings of the corporation. </LI></UL>


<P>&nbsp;</P>
<B><P>AGLR "Umbrella" Risk Management Policy</P>
</B>

<UL>
<LI>Identification</LI>
<LI>Definition</LI>
<LI>Purpose</LI>
<LI>Instruments/Activities</LI>
<LI>Measurement Methodology</LI>
<LI>Monitoring</LI>
<LI>Limit Structure</LI>
<LI>Compliance</LI>
<LI>Responsibilities</LI>
<LI>Reporting</LI></UL>


<P>Sequent/Commodity Risk Management Policy</P>

<UL>
<LI>Fair Value Valuation Policy</LI>
<LI>Credit Policy and Procedures</LI></UL>


<P>Operations Risk Management Policy</P>

<P>Interest Rate Risk Management Policy</P>

<P>Credit Risk Management Policy</P>

<P>&nbsp;</P>
<B><P>Earnings at Risk</P>


<UL>
</B><LI>Canvass - all business units for embedded risks.</LI>
<LI>Identify and quantify potential range of uncertainty around specific risks.</LI>
<LI>Create - the unique nature of each risk is addressed, understood, and managed to provide meaningful information.</LI>
<LI>Build Earnings at Risk (EaR) model.</LI>
<LI>Mitigate manageable exposures through the development of action plans.</LI>
<LI>Report findings to Risk Management Committee and Finance &amp; Risk Management Committee.</LI></UL>


<P>&nbsp;</P>
<B><P>Sequent Risk Profile </P>
</B>

<UL>
<LI>Asset backed operations</LI>
<LI>Arbitrage/ back to back transactions</LI>
<LI>Low open position results in a low VaR</LI>
<LI>Price transparency - short tenor transactions</LI>
<LI>Niche one-commodity, one region player - Southeast market</LI>
<LI>Top 10 counterparty exposure A- rated</LI>
<LI>Rolling best-practice diagnostics</LI></UL>


<U><P>Reported Risk Metrics</P>
</U>

<UL>
<LI>P&amp;L daily, monthly, quarterly, year-to-date</LI>
<LI>1 and 20-day VaR</LI>
<LI>Scenario stress testing</LI>
<LI>Credit exposure metrics</LI>
<LI>Limit monitoring</LI></UL>


<P>&nbsp;</P>
<P>{graphic of Sharpe Ratio 2.87}</P>

<P>Sharpe Ratio - Benchmarks</P>

<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=444>
<TR><TD WIDTH="51%" VALIGN="TOP">
<U><P>Mutual Funds:</U></TD>
<TD WIDTH="49%" VALIGN="TOP">
<U><P>Trading Systems:</U></TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<P>Sharpe&gt;0</TD>
<TD WIDTH="49%" VALIGN="TOP">
<P>Sharpe&gt;0</TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<P>Sharpe&gt;1 "Pretty Good"</TD>
<TD WIDTH="49%" VALIGN="TOP">
<P>Sharpe&gt;1 "Very Good"</TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">
<P>Sharpe&gt;2 "Outstanding"</TD>
<TD WIDTH="49%" VALIGN="TOP">
<P>Sharpe&gt;2 "Outstanding"</TD>
</TR>
<TR><TD WIDTH="51%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="49%" VALIGN="TOP">&nbsp;</TD>
</TR>
</TABLE>


<FONT SIZE=2><P>&nbsp;</P>
</FONT><B><P>Summary</P>
</B>

<UL>
<LI>Risk management is real-time and evolving activity</LI>
<LI>AGLR enterprise-wide, touches all business units</LI>
<LI>Deep engagement in business activities</LI>
<LI>On the trading floor daily</LI>
<LI>Driving force for implementing and maintaining best practices</LI>
<LI>Direct reporting to Board Finance and Risk Management Committee</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<FONT SIZE=5><P>Delivering Value<BR>
through Finance</P>
</FONT>
<P>Drew Evans</P>
<P>Vice President and Treasurer</P>
<P>AGL Resources</P>

<FONT SIZE=2><P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>[AGL Resources logo appears here]</P>

</FONT><P>&nbsp;</P>
<P>&nbsp;</P>
<P>Asset Deployment</P>


<UL>
<LI>Regulated businesses represent over 90% of total assets deployed</LI></UL>


<UL>
<FONT SIZE=2><LI>Under regulatory compact in 3 states</LI></UL>


<UL>
</FONT><LI>Wholesale Services has approximately $210 million in assets or 6% of total</LI></UL>


<UL>
<FONT SIZE=2><LI>Primarily storage positions and working capital requirements</LI></UL>


<UL>
</FONT><LI>Energy Investments has approximately $150 million in assets or 4% of total</LI></UL>


<UL>
<FONT SIZE=2><LI>AGL Networks, SouthStar, US Propane </LI></UL>

</FONT>
<P>[The following information is presented as a graphic]</P>
<I><FONT SIZE=2><P>Distribution Operations - 90%</P>
<P>Wholesale Services - 6%</P>
<P>Energy Investments - 4%</P>
</I></FONT>
<P>$3.5 Billion in total Assets</P>

<P>2</P>

<P>&nbsp;</P>
<P>Assets and Liabilities</P>


<UL>
<LI>Nearly $3.5 billion of total assets and liabilities in our business</LI></UL>


<UL>
<FONT SIZE=2><LI>Book value of equity of approximately $760 million</LI>
<LI>Total debt of approximately $1.4 billion</LI>
<LI>Remainder represents AP/AR, deferred credits, income taxes, and accrued liabilities</LI></UL>


<UL>
</FONT><LI>Equates to debt to capitalization of 65%</LI></UL>


<P>[The following information is presented as a graphic]</P>
<I><FONT SIZE=2><P>Debt - $1,390 million</P>
<P>Equity - $760 million</P>
</I></FONT>
<P>3</P>

<P>&nbsp;</P>
<P>Liability Composition</P>


<UL>
<LI>Total liabilities of approximately $1.4 billion</LI>
<LI>Comprised of standard and simple instruments</LI></UL>


<UL>
<FONT SIZE=2><LI>Bank Facility</LI>
<LI>Medium Term Notes</LI>
<LI>Senior Notes</LI>
<LI>Trust Preferred</LI></UL>


<UL>
</FONT><LI>Provides for flexibility across the issuance spectrum</LI></UL>


<P>[The following information is presented as a graphic]</P>
<I><FONT SIZE=2><P>Trust Preferred - $225 million</P>
<P>Senior Notes - $300 million</P>
<P>Medium Term Notes - $545 million</P>
<P>Short Term Debt - $320 million</P>
</I></FONT>
<I><P>As of 3Q02</P>
</I>
<P>4</P>

<P>&nbsp;</P>
<P>Bank Facility</P>

<P ALIGN="CENTER"><CENTER><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=738>
<TR><TD WIDTH="50%" VALIGN="TOP">

<UL>
<LI>Bank Facility Renewed in August</UL>
</TD>
<TD WIDTH="50%" VALIGN="TOP">

<UL>
<LI>Commercial Paper Program</UL>
</TD>
</TR>
<TR><TD WIDTH="50%" VALIGN="TOP">

<UL>
<FONT SIZE=2><LI>$500,000,000 Credit Facility</LI>
<LI>$200,000,000 364-day facility</LI>
<LI>$300,000,000 Three-year facility</LI>
<LI>One year term-out option on the 364-day facility</LI>
<LI>Debt-to-Capitalization not to exceed 70%</LI>
<LI>Minimum Consolidated Net Worth of $586 million, plus 25% of net income and 80% of equity offering proceeds</LI>
<LI>Material Adverse Change clause only at Closing</LI>
<LI>Backstop to commercial paper</UL>
</FONT></TD>
<TD WIDTH="50%" VALIGN="TOP">

<UL>
<FONT SIZE=2><LI>Very well subscribed</LI>
<LI>Paper prices very tightly to benchmarks</LI>
<LI>Goal is to maintain consistent bucketing of maturities to capture benefit in short term rates</LI>
<LI>50% 30-days or less</LI>
<LI>25% 30 to 60 days</LI>
<LI>25% 60 to 90 days</LI>
<LI>Issuance over 2003 has already begun</UL>
</FONT></TD>
</TR>
</TABLE>
</CENTER></P>


<P>5</P>

<P>&nbsp;</P>
<P>Maturity Schedule</P>

<P>[The following information is presented as a graphic]</P>
<P ALIGN="LEFT"><TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=277>
<TR><TD VALIGN="TOP" COLSPAN=2>
<I><P ALIGN="CENTER">Millions</I></TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2002</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$48.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2003</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$30.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2004</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$33.5</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2005</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$42.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2006</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$10.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2011</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$300.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2012</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$15.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2013</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$69.1</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2014</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$7.2</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2015</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$11.2</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2017</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$22.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2019</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$43.5</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2021</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$30.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>2022</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$46.0</TD>
</TR>
<TR><TD WIDTH="49%" VALIGN="TOP">
<P>Thereafter</TD>
<TD WIDTH="51%" VALIGN="TOP">
<P>$362.5</TD>
</TR>
</TABLE>
</P>



<UL>
<LI>Burden of refinancing given current maturity schedule is very light</LI>
<LI>Goal is to allow near term maturities to be absorbed into short term debt</LI>
<LI>Allows for more liquid and better priced instruments to be issued</LI></UL>


<P>6</P>

<P>&nbsp;</P>
<P>Fixed to Floating Mix</P>


<UL>
<LI>Very near targeted levels</LI>
<LI>To increase the percentage of floating in the mix, AGLR entered into a fixed-for-floating swap in Nov. '01</LI></UL>


<UL>
<LI>Currently produces about $900k in positive carry each quarter</LI>
<LI>Currently has a market value in excess of $3 million</LI></UL>


<UL>
<LI>We will take advantage of the historically low yields on corporate bonds</LI></UL>


<P>[The following information is presented as a graphic]</P>
<I><FONT SIZE=2><P>Floating Debt - 28.4%</P>
<P>Fixed Debt - 71.6%</P>
</I></FONT>
<I><P>As of 3Q02</P>
</I>
<P>7</P>

<P>&nbsp;</P>
<P>Contingent Capital</P>


<UL>
<LI>AGLR has contracts with adequate assurance provisions relating to trade credit/payment on behalf of Sequent</LI>
<LI>Normal course of business assurances </LI>
<LI>Small percentage of contracts would require cash collateralization if AGLR were downgraded below investment grade</LI>
<LI>Total capital outflow would be $22.3 million </LI>
<LI>Value is disclosed in recent 10Q and will be reported prospectively</LI></UL>


<P>8</P>

<P>&nbsp;</P>
<P>Ratings</P>


<UL>
<LI>Currently BBB+, Baa1 and BBB+ with S&amp;P, Moody's and Fitch respectively</LI>
<LI>Slightly more levered than the benchmark, AGLR continues to exceed goals established with agencies when VNG was acquired</LI>
<LI>Continue to keep the agencies apprised of our activities</LI></UL>


<P>9</P>

<P>&nbsp;</P>
<P>Pension</P>


<UL>
<LI>Pension asset has suffered same fate as majority of Fortune 500 and is 14 percent smaller than year-end 2001</LI>
<LI>Pension was fully funded at that time</LI>
<LI>Due to decline in asset value and reduction in rate used to discount asset, an unfunded "ABO" may exist at the end of the plan year</LI>
<LI>AGLR is currently looking at alternatives to reduce the impact of this shortfall, including:</LI></UL>


<UL>
<FONT SIZE=2><LI>Funding entire shortfall to reduce impact on common equity</LI>
<LI>Partial funding to allow the asset value to grow</LI></UL>

</FONT>
<P>10</P>

<P>&nbsp;</P>
<P>Summary</P>


<UL>
<LI>Continue to have good access to capital</LI>
<LI>Minimal contingent liabilities</LI>
<LI>Actively manage to maintain solid investment-grade ratings</LI></UL>


<P>11</P>

<FONT SIZE=2><P>&nbsp;</P>
</FONT><B><FONT SIZE=5><P>Delivering Value through AGL Networks</P>
</B></FONT>
<P>Eric Martinez</P>
<P>Executive Vice President</P>
<P>AGL Networks</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>{AGL Resources logo appears here}</P>

<P>&nbsp;</P>
<B><P>Agenda</P>


<UL>
<LI>AGL Network Overview</LI>
<LI>Business Model</LI>
<LI>Strategy and Tactics</LI>
<LI>Why Our Model Will Succeed</LI></UL>



<UL>
<LI>Financials</LI></UL>



<UL>
<LI>Growth</LI></UL>


<P>&nbsp;</P>
<P>AGLN Overview</P>

<P>First, Some Definitions</P>
</B>

<UL>
<I><LI>POP</I> (Point of Presence) - The point at which a line from a long distance carrier (IXC) connects to the line of the local telephone company or to the user directly.</LI>
<I><LI>CO</I> (Central Office) - a telephone company building that houses switching equipment for connecting other subscribers to each other, locally and long distance</LI>
<I><LI>Carrier Hotel</I> - a term for a building that houses many local and long distance telephone companies, usually owned by a "disinterested" third party</LI>
<I><LI>Colocation</I> - a competing phone company providing network connections to several carriers housed together in a server room.</LI>
<I><LI>RBOC</I> (Regional Bell Operating Company) - the dominant local phone carrier within a specific geographic region (i.e. Bell South)</LI>
<I><LI>CLEC </I>(Competitive Local Exchange Carrier) - a local phone company that competes with the ILEC (i.e. MFN, Time Warner Telecom, Level 3, Winstar)</LI></UL>

<I>
</I><P>&nbsp;</P>
<B><P>Signaling Speeds</P>
</B>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=519>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>T-1/DS-1</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>24</TD>
<TD WIDTH="53%" VALIGN="TOP" COLSPAN=2>
<P>Simultaneous Digitized signals</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>DS-3</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>28</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>T-1's</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>45 Mbps</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>OC-3</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>3</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>DS-3</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>155 Mbps</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>OC-3</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>3</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>DS-3</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>155 Mbps</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>OC-12</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>12</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>DS-3's</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>622 Mbps</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>OC-48</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>48</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>DS-3's</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>2,448 Mbps</TD>
</TR>
<TR><TD WIDTH="31%" VALIGN="TOP">
<P>OC-192</TD>
<TD WIDTH="16%" VALIGN="TOP">
<P>192</TD>
<TD WIDTH="22%" VALIGN="TOP">
<P>DS-3's</TD>
<TD WIDTH="32%" VALIGN="TOP">
<P>10,000 Mbps</TD>
</TR>
</TABLE>


<FONT SIZE=2><P>&nbsp;</P>
<P>&nbsp;</P>
</FONT><B><P>Telecomm Schematic</P>
</B>
<B><P>Current Network View</P>


<UL>

<UL>
</B><LI>POP</LI>
<LI>CO</LI>
<LI>Internet</LI>
<LI>COLO</LI>
<LI>Long distance</LI>
<LI>Internet</LI>
<LI>ILEC/CLEO</LI></UL>
</UL>


<UL>

<UL>
<LI>tandem</LI>
<LI>CO</LI>
<LI>POP</LI>
<LI>Long distance</LI></UL>
</UL>


<B><P>Fiber View</P>
</B>
<P>{graphic of metro Atlanta network}</P>

<P>&nbsp;</P>
<B><P>Business Model</P>


<UL>
</B><LI>Infrastructure Provider</LI>
<LI>Conduit</LI>
<LI>Dark Fiber</LI></UL>


<UL>
<LI>Metropolitan Networks</LI>
<LI>Distressed Assets</LI>
<LI>Connectivity to Building Wall - "Revenue Ready"</LI>
<LI>Connectivity to Wireless and Next Generations</LI></UL>


<P>&nbsp;</P>
<P>{Map of metro Atlanta network}</P>

<P>Atlanta Network</P>

<UL>

<UL>
<LI>175 miles</LI>
<LI>8 conduits</LI>
<LI>8 rings</LI></UL>
</UL>


<P>Location</P>

<UL>

<UL>
<LI>Downtown</LI>
<LI>Midtown</LI>
<LI>Buckhead</LI>
<LI>Sandy Springs</LI>
<LI>Galleria</LI>
<LI>Airport</LI>
<LI>Alpharetta</LI></UL>
</UL>


<P>Connected to</P>

<UL>

<UL>
<LI>Carrier hotels</LI>
<LI>POP's</LI>
<LI>LSO's</LI>
<LI>Enterprise Buildings</LI></UL>
</UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>Target Market</P>

<P>Interexchange Carrier</P>
</B>

<UL>
<LI>IXC's (Carriers) preceded development of local infrastructure</LI>
<LI>They rely on their own national backbone for transport and depend on metro access providers for dark fiber rings in the metro core</LI>
<LI>The lack of local fiber is the reason much of the long-haul fiber is unused</LI>
<LI>IXCs and the metro providers will need fiber facilities in the <U>last mile</U> to compete in end-to-end services</LI></UL>


<P>&nbsp;</P>
<B><P>Target Market</P>

<P>Regional Bell Operating</P>
<P>Companies (RBOC's)</P>
</B>

<UL>
<LI>What they require:</LI>

<UL>
<LI>Fiber capacity/connectivity needs vs copper </LI>
<LI>Redundancy</LI>
<LI>Local capabilities for out-of-region RBOCs for their largest customers</LI>
<LI>Out of region RBOC, not relying on in region RBOC, for facilities</LI>
<LI>Infrashare - Large capital investments dispersed amongst several players</LI></UL>
</UL>


<P>&nbsp;</P>
<B><P>Target Market</P>

<P>Enterprise/Institutions</P>
</B>

<UL>
<LI>Data-rich applications are requiring more capacity to move information between users in a timely manner.</LI>

<UL>
<LI>Video conferencing</LI>
<LI>Check imaging and credit card processing</LI>
<LI>Storage Area Networks</LI></UL>
</UL>


<UL>
<LI>Internet traffic grew approximately 100% in 2001. Data traffic now constitutes well over half of all network traffic (vs. voice)</LI>
<LI>Local RBOC infrastructure does not address needs quickly or cost-effectively</LI></UL>


<I><P>Source: Telecommunications Industry Association (TIA), Sept. 2002</P>
</I>
<P>&nbsp;</P>
<B><P>A Balanced Portfolio</P>
</B>
<P>{Pie chart depicting Contract Valuation Year-to-Date 2002}</P>

<P>Enterprise 49%</P>
<P>IXCs 29%</P>
<P>ISPs 17%</P>
<P>Universities 5%</P>

<P>&nbsp;</P>
<B><P>Opportunities for AGL Networks</P>
</B>

<UL>
<LI>In-place assets are available at cents on the dollar</LI>
<LI>Competitors' business strategies and infrastructure are not geared toward dark fiber sales</LI>
<LI>Customers uneasy over bankruptcies of large providers</LI>
<LI>RBOCs' tariff structures and marketing practices do not allow them to be competitive</LI>
<LI>Inexpensive electronics allow enterprise customers to "light" their own networks</LI></UL>


<P>&nbsp;</P>
<B><P>How We Make Money</P>
</B>

<UL>
<LI>All transactions thus far are term leases rather than asset sales, predominantly with upfront cash</LI>
<LI>467 tax code applies, which allows for the receipt of cash up-front, while taxes are paid over the term of the lease</LI>
<LI>Revenue is recognized over the term of the contract</LI>
<LI>Possibility of asset sales remains to anchor incremental markets</LI></UL>


<P>&nbsp;</P>
<B><P>What We Have Learned From Others</P>
</B>

<UL>
<LI>Poor market positioning - No differentiation between "me too" strategies, everyone had to own their own system</LI>
<LI>Overly optimistic demand growth forecasts - High expectations on penetration and up-selling opportunities in all market segments</LI>
<LI>Terrible CAPEX Management - Overspent on assets to implement poorly managed growth creating too much debt load</LI>
<LI>Low barriers to entry - Capital too easily available, enticing market entrants</LI>
<LI>Poor management practices - Limited controls, reliance on continued equity appreciation to cover mistakes, "shoot from the hip" strategies</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>Capital Invested 2002</P>
</B>
<P>{bar graph appears here Q1, Q2, Q3 &amp; Q4 (estimates): Total Year-end CAPEX: $32.5M}</P>

<P>&nbsp;</P>
<B><P>2002 YTD Financial Summary</P>
</B>
<P>{bar graph appears here Earned Revenue, Deferred Revenue, Cash &amp; Capital}</P>

<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=384>
<TR><TD WIDTH="77%" VALIGN="TOP">
<U><P>Totals <I>(in millions of dollars):</I></U></TD>
<TD WIDTH="23%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Earned Revenue</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$1.6</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Deferred Revenue</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$18.9</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Cash</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$13</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Capital</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$22.5</TD>
</TR>
</TABLE>


<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>2002 Year-End Estimate</P>
</B>
<P>{bar graph appears here Earned Revenue, Deferred Revenue, Cash &amp; Capital}</P>

<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=384>
<TR><TD WIDTH="77%" VALIGN="TOP">
<U><P>Totals <I>(in millions of dollars):</I></U></TD>
<TD WIDTH="23%" VALIGN="TOP">&nbsp;</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Earned Revenue</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$1.9</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Deferred Revenue</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$33.9</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Cash</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$34.5</TD>
</TR>
<TR><TD WIDTH="77%" VALIGN="TOP">
<P>Capital</TD>
<TD WIDTH="23%" VALIGN="TOP">
<P>$32.5</TD>
</TR>
</TABLE>


<P>&nbsp;</P>
<B><P>Growth Strategy</P>
</B>

<UL>
<LI>Increase utilization through leasing</LI>
<LI>Penetrate additional markets</LI>
<LI>Create new services</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>Future Growth  - Increase Utilization</P>
</B>
<B><P>Fiber Miles in Inventory</P>

<P>{</B>Pie graph appears here: 96% Available; 4$ Sold}</P>

<P>&nbsp;</P>
<B><P>Future Growth - New Cities</P>

<P>Growth Strategy</P>


<UL>
</B><LI>Turnkey</LI>
<LI>St. Louis</LI>
<LI>Kansas City</LI>
<LI>Richmond</LI></UL>



<UL>
<LI>Anchor Tenet</LI>
<LI>Atlanta</LI>
<LI>Phoenix</LI></UL>



<UL>
<LI>Infrastructure</LI>
<LI>Exploring potential of cities with similar characteristics to Atlanta</LI></UL>


<P>{map of United States appears here: Phoenix, Kansas City, St. Louis, Richmond, and Atlanta}</P>

<P>&nbsp;</P>
<B><P>City Selection Criteria</P>


<UL>
</B><LI>Sun Belt locale, growing from our southeast sphere of influence</LI>
<LI>Tier 1 city or population greater than 2 million</LI>
<LI>Retail Revenue must be greater than $1 billion</LI>
<LI>Competition</LI>
<LI>Footprint</LI>
<LI>Business Plans</LI>
<LI>Companies</LI></UL>


<UL>
<LI>Asset investment</LI>
<LI>Must be able to own conduit and interest in manholes </LI>
<LI>Distressed</LI></UL>


<UL>
<LI>City relations</LI>
<LI>Customers - anchor tenet pulling us there</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<P>{map of metro Phoenix network appears here}</P>

<P>Phoenix Network</P>

<UL>
<LI>60 miles</LI>
<LI>1 conduit</LI>
<LI>3 rings</LI></UL>


<P>Location</P>

<UL>
<LI>Downtown</LI>
<LI>Midtown</LI>
<LI>Airport</LI></UL>


<P>Connected to</P>

<UL>
<LI>Carrier hotels</LI>
<LI>POP's</LI>
<LI>LSO's</LI></UL>


<P>&nbsp;</P>
<B><P>Phoenix vs Atlanta</P>

<U><P>Phoenix</P>

<UL>
</B></U><LI>Entered by buying bankrupt asset</LI>
<LI>Third party provides maintenance</LI>
<LI>60 conduit miles</LI>
<LI>17,280 fiber miles</LI>
<LI>545 businesses over 250 employees</LI>
<LI>10 headquarters of Fortune 1000</LI></UL>


<B><U><P>Atlanta</P>

<UL>
</B></U><LI>Entered by buying bankrupt asset</LI>
<LI>We provide maintenance</LI>
<LI>175 conduit miles</LI>
<LI>Approx. 50,000 fiber miles</LI>
<LI>774 businesses over 250 employees</LI>
<LI>24 headquarters of Fortune 1000</LI></UL>


<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>Future Growth - Services</P>

<P>&nbsp;</P>
<P>Wireless Industry</P>


<UL>
</B><LI>Wireless represents 12% of all calls today, expected to grow to 25% by 2005*</LI>
<LI>Due to higher capacity applications being introduced for wireless devices, bandwidth is growing at 130% per year**</LI>
<LI>Looking for high speed and low speed solutions</LI></UL>


<I><P>*Insight Research Corporation - 4/2002</P>
<P>**CIBC - 2002</P>
</I>
<B><P>Cell Site Express</P>


<UL>
</B><LI>Leverages our existing asset</LI>
<LI>Connect towers straight to the MSCs</LI>
<LI>Sell the equivalent of T1 service to the wireless carriers</LI>
<LI>Sell - Build</LI></UL>


<P>{graph of network}</P>

<P>&nbsp;</P>
<B><P>Opportunities</P>


<UL>
</B><LI>Combination of upfront cash and solid corporate credit enabled us to pursue these opportunities</LI>
<LI>Over time, others can replicate certain aspects of the model</LI>
<LI>Must be one step ahead on:</LI>
<LI>Execution</LI>
<LI>Marketing</LI>
<LI>Service innovation</LI>
<LI>Horizontal integration</LI></UL>


<P>&nbsp;</P>
<B><P>&nbsp;</P>
</B><P>&nbsp;</P>
<B><FONT SIZE=4><P>&nbsp;</P>
</FONT><FONT SIZE=5><P>Delivering Value</P>
</B></FONT>
<P>Paula G. Rosput</P>
<P>Chairman, President and CEO</P>
<P>AGL Resources</P>

<P>Analyst Conference</P>
<P>November 6-8, 2002</P>
<P>Miami, Florida</P>

<P>{AGL Resources logo appears here}</P>

<P>&nbsp;</P>
<B><P>Corporate Governance</P>
</B>
<B><U><P>Board of Directors</P>

<UL>
</B></U><LI>Executive Committee</LI>
<LI>Corporate Responsibility Committee</LI>
<LI>Nominations &amp; Corporate Governance Committee</LI>
<LI>Audit Committee</LI>
<LI>Finance and Risk Management Committee</LI>
<LI>Compensation Committee</LI></UL>


<P>&nbsp;</P>
<B><P>Significant Milestones in Governance</P>
</B>
<P>07/01 Formed Nominations and Corporate Governance Committee</P>
<P>09/01 Formed Risk Management Committee</P>
<P>01/02 CEO Performance Review</P>
<P>08/02 </P>

<UL>

<UL>
<LI>Sarbanes-Oxley Act signed</LI>
<LI>Consultant for Compensation Committee</LI></UL>
</UL>

<P>09/02 Engaging consultant to expand board</P>


<UL>
<LI>Board frequently meets in executive session without management present</LI>
<LI>Deep engagement around asset management</LI>
<LI>Only one insider on board (Paula Rosput)</LI>
<LI>Independent director is chair of Executive Committee</LI></UL>


<P>&nbsp;</P>
<B><P>Next Milestones</P>
</B>

<UL>
<LI>December board planning meeting</LI>
<LI>Will issue guidance in January</LI>
<LI>Late January earnings announcement and file 10-K in late February</LI>
<LI>Annual report mailing mid-March</LI>
<LI>Annual meeting April 16, 2003</LI>
<LI>AGA Update</LI></UL>


<P>&nbsp;</P>
<B><P>Still Building . . . </P>

<P>VALUE</P>

<UL>
<LI>Commercial Sensibility</LI>
<LI>Regulatory Expertise</LI>
<LI>Operational Best Practices</LI></UL>


<P>&nbsp;</P>
<P>SIGNATURE</P>
</B><P>Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.</P>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=9 WIDTH=670>
<TR><TD WIDTH="40%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="60%" VALIGN="TOP">
<B><FONT SIZE=2><P>AGL RESOURCES INC.</B></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="60%" VALIGN="TOP">
<FONT SIZE=2><P>(Registrant)</FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">
<FONT SIZE=2><P>Date:  November 7, 2002</FONT></TD>
<TD WIDTH="60%" VALIGN="TOP">
<U><FONT SIZE=2><P>/s/ Richard T. O'Brien</U></FONT></TD>
</TR>
<TR><TD WIDTH="40%" VALIGN="TOP">&nbsp;</TD>
<TD WIDTH="60%" VALIGN="TOP">
<FONT SIZE=2><P>Executive Vice President and Chief Financial Officer</FONT></TD>
</TR>
</TABLE>

<FONT SIZE=2></FONT></BODY>
</HTML>
[{"type": "8-K", "sequence": "1", "filename": "item9_2002nov7.htm", "description": "NOVEMBER 6, 2002 - ITEM 9", "secsgml_size_bytes": 105047}]
{"company-data": {"conformed-name": "AGL RESOURCES INC", "cik": "0001004155", "assigned-sic": "4924", "irs-number": "582210952", "state-of-incorporation": "GA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-14174", "film-number": "02811730"}, "business-address": {"street1": "817 WEST PEACHTREE ST NW", "street2": "10TH FLOOR", "city": "ATLANTA", "state": "GA", "zip": "30308", "phone": "4045849470"}, "mail-address": {"street1": "817 WEST PEACHTREE ST. N.W.", "street2": "STE 1000", "city": "ATLANTA", "state": "GA", "zip": "30308"}}
SECURITIES AND EXCHANGE COMMISSION
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 7, 2002
AGL RESOURCES INC.
(Exact Name of Registrant as Specified in Charter)
Georgia
1-14174
58-2210952
(State or Other Jurisdiction Of Incorporation
(Commission File No.)
(IRS Employer Identification No.)
817 West Peachtree Street, NW, Suite 1000, Atlanta, Georgia 30308
(Address of Principal Executive Offices)
(Zip Code)
(404) 584-9470
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Item 9. Regulation FD Disclosure
Materials discussed at the AGL Resources Inc. 2002 Analyst Conference to be held on November 6-8,2002.
Forward-Looking Statements
Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  The future results and securities values of AGL Resources and its subsidiaries may differ materially from those expressed in the forward-looking statements contained throughout these presentations and in documents filed with the Securities and Exchange Commission.  Many of the factors that will determine these results and values are beyond AGL Resources' ability to control or predict.  The statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital markets conditions; inflation rates; interest rates; energy markets; weather conditions; business and regulatory or legal decisions; the pace of deregulation of natural gas; the timing and success of business development efforts; and other uncertainties and risks.  You are cautioned not to put any undue reliance on any forward-looking statement, and to consult the company's periodic public SEC filings for other risks and factors that could materially impact the company's operations and financial results.
Delivering Value
Paula G. Rosput
Chairman, President and CEO
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Our Success Has Been Deliberate
[The following data is presented in graphic format]
Year-to-Date
Last Twelve Months
Trailing 24 Months
Trailing 36 Months
AGL Resources
6.4%
13.0%
16.6%
34.5%
LDC Index
(2.9)%
1.9%
9.3%
6.8%
S&P 500
(22.0)%
(18.3)%
(34.7)%
(34.2)%
Large-cap LDC Index
(5.2)%
(1.0)%
5.1%
(0.9)%
Mid-cap LDC Index
6.0%
10.3%
27.5%
24.4%
Small-cap LDC Index
(19.7)%
(12.3)%
(19.1)%
(12.5)%
Data includes closing prices through November 1, 2002
2
A Multi-Year Plan That Features:
A fundamentals orientation
Management's value philosophy
Spectrum of  necessary skill sets
Discipline in execution
We like to "kick the tires"
3
2002 Milestones
[The following data is presented in graphic format]
Improve earnings
Change the Regulatory Paradigm
Accelerate Telecom
Jan
AGLN AT&T Deal Signed
April
1Q: $0.90 vs. $0.87 First Call
AGLC/GPSC establish PBR
May
Sequent one-year mark (3 Bcf/day)
Producer Services Initiated
June
Completed Atlanta network
July
2Q: $0.22 vs. $0.20 First Call
Credit Default avoided with merchants [Graphic indicates Jun-Oct+)
AGLN Emory deal signed
Aug
Credit Facility Closing
AGLN B of A deal signed
Sept
WNA Approved for VNG
AGLN Expands into:
Kansas City
St. Louis
Richmond
Phoenix
Oct
3Q: $0.17 vs. $0.14
4
What Are The Fundamentals for 2003?
Pervasiveness of financial distress in the industry
Volatility of underlying commodity
Deepening governmental involvement
Understanding value cycle
Acquisition ambition tempered by value cycle realities
5
Financial Distress in the Industry
[The following data is presented in graphic format]
Market Capitalization Changes (Last 12 Months)
RECENT CREDIT DOWNGRADES
Williams - July 2002 - outlook NEGATIVE
Dynegy - July 2002 - outlook NEGATIVE
Duke Energy - August 2002 - outlook STABLE
Aquila - September 2002 - outlook NEGATIVE
Mirant - October 2002 - outlook NEGATIVE
CenterPoint (Reliant) - November 2002 - outlook NEGATIVE
El Paso - October 2002 - outlook NEGATIVE
Energy East - March 2002 - outlook STABLE
Sempra Energy - March 2002 - outlook STABLE
UGI - September 2002 - outlook STABLE
PGL - September 2002 - outlook NEGATIVE
6
Financial Distress In the Industry
In millions
As of 9/30/02
Gross Receivable
Gross Payable
Receivables with netting agreements in place:
Counterparty is investment grade
$87.6
$75.8
Counterparty is non-investment grade
11.2
16.0
Counterparty has no external rating
2.0
13.6
Receivables without netting agreements in place:
Counterparty is investment grade
6.2
16.6
Counterparty is non-investment grade
-
-
Counterparty has no external rating
-
0.4
Amount recorded on balance sheet
$107.0
$122.4
Credit support and netting are essential
in real time
7
Distress is Not Unique to Energy Industry
Stock Price
Shares
Market Cap
Value
Company
$/Share
Outstanding
($ Billions)
Degradation
Jan-00
Recent
(Millions)
Jan-00
Recent
($ Billions)
Cisco
55.00
14.34
7,315
402.3
104.9
297.4
Nortel
55.00
2.32
3,206
176.3
7.4
168.9
Alcatel
40.00
7.07
1,231
49.2
8.7
40.5
JDS Uniphase
80.00
3.62
1,519
121.5
5.5
116.0
Lucent
50.00
2.26
3,407
170.4
7.7
162.7
Ericsson
15.00
1.52
8,059
120.9
12.2
108.6
WorldCom
60.00
0.09
2,963
177.8
0.3
177.5
Nokia
42.00
21.50
4,737
199.0
101.8
97.1
Motorola
40.00
14.70
2,267
90.7
33.3
57.4
Over $1.2 Trillion of stockholders' equity lost in 30 months
8
Volatility
[Graphic appears here]
Continue to seek regulatory partnerships to dampen effects
Recognize that longer-term business prospects lie in managing volatility, rather than retailing it
[Graphic appears here]
9
Market Is Becoming More Peak Reliant
[Graphic appears here]
10
Regulatory Environment
[Graphic appears here]
We continue to invest the resources to do the job right.
11
[Graphic appears here]
12
Return on Invested Capital
(Based on AGLR Core Earnings)
[Graphic appears here]
The challenge of moving a behemoth
13
Valuations as Multiple of EBITDA
[The following data is presented in graphic format]
El Paso/TPC
8.9X
Williams/Transco
8.3X
Mid-American/Kern River
7.1X
Mid-American/NNG
7.3X
Atmos/MS Valley
11.4X
Piedmont/NCNG
12.8X
Recent decline in valuation from historical precedents
Recent pipeline deals acquired at 6.5x - 7.5x LTM EBITDA -- below historical pipeline range of around 8.0x
Strategic buyers must be able to make the multiples work!
14
Proven Track Record in Consolidation
VNG accretive in nine months, using 100% debt
VNG scenarios at 40% equity financing
Equity will be a key ingredient in future transactions
15
Matching Our Valuation to Likely Opportunities
[The following data is presented in graphic format]
ATG
13.4X
GAS
11.3X
EAS
13.1X
OKE
14.1X
PGL
13.1X
PNY
17.6X
WGL
18.0X
WGR
29.1X
ATO
14.5X
NJR
14.6X
NWN
15.7X
SUG
9.9X
SWX
15.6X
UGI
13.9X
CGC
16.3X
LG
17.1X
NUI
11.7X
Data includes closing prices through October 24, 2002
16
Strategy for 2003
Measurably improve return on invested capital (ROIC) in base business
Increase asset management business
Build repeatable multi-city telecom business
Execute on opportunities to take advantage of current industry distress
Enhance strength of balance sheet
17
Financial Overview and Strategy
Richard T. O'Brien
Executive Vice President
and Chief Financial Officer
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
{AGL Resources logo appears hear}
Forward-Looking Statements
Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  The future results and securities values of AGL Resources and its subsidiaries may differ materially from those expressed in the forward-looking statements contained throughout these presentations and in documents filed with the Securities and Exchange Commission.  Many of the factors that will determine these results and values are beyond AGL Resources' ability to control or predict.  The statements are necessarily based upon various assumptions involving judgments with respect to the future, including, among others, the ability to achieve synergies and revenue growth; national, international, regional and local economic, competitive and regulatory conditions and developments; technological developments; capital markets conditions; inflation rates; interest rates; energy markets; weather conditions; business and regulatory or legal decisions; the pace of deregulation of natural gas; the timing and success of business development efforts; and other uncertainties and risks.  You are cautioned not to put any undue reliance on any forward-looking statement, and to consult the company's periodic public SEC filings for other risks and factors that could materially impact the company's operations and financial results.
Financial Management Philosophy
Low-cost asset operator
Disciplined financial approach
No planes, executive loans, etc.
Attention to detail
Weekly operations and financial assessment
Monthly earnings and accounting reviews
Frequent strategic reviews and planning sessions
Risk management
Strong risk management capability in all business units
Maintain physical, asset-based approach to asset optimization efforts
Earnings visibility and transparency remain key financial goals for ATG
Third Quarter Financial Results
{bar graph depicting}
Earnings Per Share
2001 $0.09
2002 $0.17
Earnings Drivers
Strong wholesale services performance due to volatility
Improved year-over-year results from SouthStar
Increased revenues and lower expenses in Distribution Operations
Lower interest expense
YTD 2002 Financial Results
{bar graph depicting}
Earnings Per Share
2001 $1.22
2002 $1.28
Earnings Drivers
Lower utility O&M, including depreciation
Higher utility revenues (pipeline replacement)
Improved contributions from SouthStar
Increased EBIT contribution from market opportunities at Sequent
Lower interest expense
EBIT - 2002 vs. 2001 For Quarter Ended September 30 (in millions)
{waterfall graph appears here}
Prior Year $30.9
AMR ($6.4)
PY Corp SSE Res ($6.0)
Rate Settlement ($1.8)
VNG, CGC volumes ($1.4)
SSE Unbilled Issue $5.7
Wholesale $4.2
Corp. OH/Bad Debt $4.1
PY Etowah W/O $2.6
Pipeline Repl. Rev $2.4
Propane/Networks $2.2
Actual $36.0
EBIT - 2002 vs. 2001 For Nine Months Ended September 30 (in millions)
{waterfall graph appears here}
Prior Year $175.7
Utilipro gain ($10.9)
Corp. Reserves ($8.6)
AMR ($6.4)
PY Storage Adj. ($4.9)
VNG Weather ($3.5)
SouthStar $13.6
Lower DO O&M $9.2
Pipeline Repl. $4.7
Lower Service Co. OH $4.2
PY Etowah W/O $2.2
Propane $1.6
Actual $176.5
Cash Flow Projections (in millions of dollars)
{bar chart depicting Total Cash Outflow for Investing and Financing}
2002
$361 Cash Inflow
$313 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)
2003
$320 Cash Inflow
$316 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)
2004
$350 Cash Inflow
$331 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)
2005
$360 Cash Inflow
$338 Cash Outflow (including: Other Cap Ex, Bare Steel Cap Ex, Interest Payments, Dividends, and MGP)
Cash Flow Strategy
Company will be cash positive by improving margins
Focus on capital efficiency and effectiveness
Improved processes around timing/amount of capital spending
Improve coverage ratios
Continuously improve cash forecasting processes and cash realizations from each business
Secure Dividend
{Bar & Line chart depicting Core EPS, DPS, and Payout Ratio}
FY 1997
FY 1998
FY 1999
FY 2000
FY 2001
FY 2002F
Core EPS
$1.37
$1.56
$0.91
$1.24
$1.50
$1.73-1.78
DPS
$1.08
$1.08
$1.08
$1.08
$1.08
$1.08
Payout Ratio
79%
70%
119%
87%
72%
62%
We are committed to the security of the dividend
Board continues to evaluate future dividend increase
Earnings Guidance
2002
Revised guidance upward to $1.73 to $1.78 per share (from previous $1.65 to $1.70)
Improved expectations reflect strong 3Q and YTD performance
2003
Will provide an update in January after formal budgeting and planning process is complete and approved by the Board
Achieving Size and Scale
Financial distress pervades the industry
Assets are beginning to be marketed and change hands
Recent decline in valuations
Focus on LDC and/or pipeline assets in the Southeast
Must meet stringent investment criteria
Sometimes the deal you don't do is as important as the one you do
Operational and strategic options using an analytical framework we continue to develop
Current Asset Portfolio
Financial pro forma
How would new assets fit in?
External Market Conditions
What assets are available and attractively priced?
Synergies from combination
Internal Considerations
Balance sheet issues
EPS growth targets
Management capabilities
Decision and Financial Analysis Framework
Identify internal improvements
Prioritize improvement initiatives
Screen opportunities
Balance sheet considerations
Prioritized Strategic Options
Internal Options
Benchmark to others
Regulatory framework
External growth
Divest/acquire
Approach Business as Portfolio of Opportunities - Buy or Sell
A Unique Investment Opportunity
Premier LDC assets with stable cash flows
Reasonable pace of growth in developing non-utility businesses to complement utility earnings
Strong, investment-grade credit
Attractive dividend yield
Improving balance sheet
Strong management team that delivers on promises
Continuing focus on cost containment and improving return on invested capital
Proven track record of organic growth and acquisition consolidation
Acquisition upside potential
Trade at a discount to peer group
Delivering Value
through Distribution & Pipeline Operations
Kevin P. Madden
Executive Vice President
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Where We Are
Fundamentals of the Business
Review of 2002 Goals and Accomplishments
2002 Financial Results
Strategic Thinking
What to Expect in 2003
Appendix  (Supplemental Data)
2
Fundamentals of the Business
Managing Customer Growth
Managing Capital Deployment
Changing the Regulatory Paradigm
3
Managing Customer Growth
(All Utilities Combined)
[Graphic appears here - depicts customer count 1995-2002]
4
Managing Our Customer Growth
Regulated Provider
Multi-family homes initiatives
Working with developers
Line extension policies
5
Managing Capital Deployment
[Graphic depicts capital expenditures expected for FY02 and FY03 broken down into the following categories:  Environmental Response Cost, Pipeline Replacement Program, Distribution/AGLC, Distribution/VNG, IS/T, and Other]
FY 02 Expected is actual at 9/30/02 plus anticipated for 4th quarter
6
Managing Capital Deployment
Construction Cost Management
[The following data appears in graphic format]
Expansion Cost Per Foot of Main
1999
2000
2001
2002
AGLR
$5.90
$5.29
$5.95
$5.41
Benchmark Median
$9.52
$12.44
$13.07
7
Changing the Regulatory Paradigm
AGLC - Performance Based Ratemaking
Allows for retention of portion of increased earnings resulting from efficiencies and growth
Reduces regulatory uncertainty for 3 years
Maintains Straight Fixed Variable (SFV) rate design
VNG - Weather Normalization
Protects earnings from asymmetric effect of weather
Provides price stability for consumers
CGC - Fixed Portion of the Bill
Provides certainty and stability for consumers
Levels revenue stream through-out the year
8
Review of 2002 Goals
We deliver what we promise. . .
Increase Earnings
Georgia
Performance Based Rates (PBR)
Virginia
Weather Normalization (WNA)
Tennessee
Rate Stabilization
Utilization of LNG Facilities
9
2002 Business Results
EBIT
Jurisdictional Rates of Return
AGLC Performance Based Rates
Classification of Net Assets
Cost per Customer
10
Comparison of EBIT
Projected 2002 vs 2001
[Graphic depicts the following information]
$ in Millions
CY01
CY02
AGLC
167.1
169.2
VNG
35.3
42.7
CGC
10.8
12.8
11
Authorized Versus Actual Returns
[The following information is presented in graphic format]
AGL Resources Utility Operations
Return on Equity 12 Months Ended September 30, 2002
Percent of Return
Authorized
Actual
AGLC
12.00 (1)
11.85 (2)
11.00 (1)
CGC
11.06
10.53
VNG
10.90
8.73 (3)
(1)  The authorized ROE is 11.00%.  The top of the earnings band is 12.00%.  The Company can also include 1/2 of VNG Synergies in calculating the return prior to sharing.
(2)  Represents 5 months under new rates and 7 months under previous rates.
(3)  Based on actual weather.
12
AGLC Performance Based Rates
[Graphic depicts projected Return on Equity for 2002-2005 assuming 1% growth in Revenue and 0% growth in O&M and projected Return on Equity for 2002-2005 assuming 1.5% growth in Revenue and 0% growth in O&M]
13
Classification of Net Assets
(as of September 30, 2002)
[Graphic depicts assets for AGLC, VNG, CGC and Total broken down into the following categories:  Rate Base, PRP Assets, ERC Assets, and Other]
14
O & M per Customer
Projected 2002 vs 2001
[Graphic depicts projected 2002 and 2001 O&M per Customer for AGLC, VNG and CGC]
15
Strategic Thinking
Peaking - Growing Peak Day Requirement
[Graphic appears here]
16
AGLR Peaking Leadership Position
Customer needs shifting to peaking
Leverage our market expertise to capitalize on the shifting needs
Paradigm shift in meeting deliverability by creating options to traditional upstream transport and storage contracts
Paradigm shift in solving localized pressure issues; reduces captive investments
[Map "Existing AGL LNG Plants" appears here]
17
Southeast Pipeline Infrastructure
Cypress - Project on hold
Gulf Pines - Project on hold
Southeastern Pipeline constraints will lead to bottlenecks and opportunities
AGLR infrastructure unique in the Southeast
[Map "Proposed AGLR Pipeline" appears here]
18
VNG Pipeline Infrastructure
Columbia's Homestead (southern zone) pipeline construction on hold
Joint-Use-Pipeline (JUP) strategically located to provide deliverability to five parties (Florida Power, Virginia Power, City of Richmond, Columbia Gas of Va, and VNG)
Anticipated supply constraints in the VNG "southern zone" in 2005
[Map appears here]
19
Final Observations:  What to Expect in 2003
Stability through regulatory compact
Capital deployment
Focus our business where we make our greatest return
Drilling down on capital
Working to achieve authorized returns and share benefits with customers
Continuing opportunities to improve service and develop wholesale asset opportunities
20
Appendix
(Supplemental Data)
Consolidating Balance Sheets
Consolidating Income Statement
Components of Rate Base
21
Consolidating Balance Sheet
at September 30, 2002
Distribution Segment
AGLC
VNG
CGC
ASSETS
Current Assets
212,943,869
97,584,052
73,137,694
42,222,122
Property, Plant & Equipment
2,046,505,669
1,580,719,446
368,098,358
97,687,864
Deferred Debits & Other Assets
864,239,689
681,198,010
181,414,335
1,627,344
TOTAL ASSETS
$3,123,689,227
$2,359,501,508
$622,650,388
$141,537,331
LIABILITIES
Current Liabilities
(284,200,693)
(230,554,892)
(33,400,826)
(20,244,975)
Accumulated Deferred Income Taxes
(319,241,393)
(292,459,992)
(13,767,417)
(13,013,984)
Long-Term Liabilities/Deferred Credits
(616,619,670)
(603,118,823)
(13,982,293)
481,446
Capitalization
(1,903,627,471)
(1,233,367,802)
(561,499,850)
(108,759,819)
TOTAL LIABILITIES
$(3,123,689,227)
$(2,359,501,508)
$(622,650,388)
$(141,537,331)
22
Consolidating Income Statement
Twelve Months Ended 9/30/02
Distribution Segment
AGLC
VNG
CGC
Revenue
797,142,328
519,924,488
209,748,067
67,469,773
Cost of Sales
226,292,360
78,567,355
110,138,981
37,586,024
Operating Margin
570,849,968
441,357,133
99,609,086
29,883,749
O&M Expenses
250,886,155
198,007,445
42,818,847
10,059,863
Other Expenses
106,831,716
79,406,133
19,706,705
7,718,878
Operating Income
213,132,097
163,943,555
37,083,534
12,105,008
Other Income
10,648,541
10,241,726
(103,651)
510,466
EBIT
223,780,639
174,185,281
36,979,883
12,615,475
Interest Expense
50,516,089
42,034,493
8,348,650
132,946
Income Taxes
64,645,667
49,498,067
10,219,460
4,928,140
NET INCOME
$108,618,883
$82,652,721
$18,411,773
$7,554,389
23
Components of Rate Base
AGL Resources Distribution Operations
Major Common Elements of Rate Base
12 Months Ended September 30, 2002
(1)
(Millions)
AGLC
CGC
VNG
Distribution Operations Total
Utility Plant
2,276.9
151.6
524.3
2,952.9
Less:
Accumulated Provision for Depreciation
795.7
58.4
169.0
1,023.2
Contributions in Aid of Construction
47.2
2.2
-
49.4
Accumulated Deferred Income Taxes
246.1
9.0
3.9
259.0
Other
3.0
2.6
9.9
15.5
Balance
1,185.1
79.4
341.4
1,605.9
Cash Working Capital
(58.0)
16.1
10.2
(31.7)
Total Rate Base
1,127.1
95.5
351.6
1,574.2
(1)  Averaging the average of 12 months of rate base balances results in an average amount which is less than the period end balances.
24
Delivering Value
through Wholesale Services
Robert M. Flavin
Dana A. Grams
Patrick J. Strange
Sequent Energy Management
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Sequent Overview
Robert M. Flavin
Executive Vice President
Sequent Energy Management
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
What a Difference a Year Makes...
Volatility
Competition
Credit
Regulatory Environment
3
Merchant Energy Markets:
What's the Same?
The Need for a Middle Man
Markets are very complex
Relationships are important
Supply and transportation balancing
Credit judgment
Continuing demand for services
4
Merchant Energy Markets:
What's Different?
Markets are more available
Margins are better
More room to grow
Greater available talent pool
Positive effects of volatility
Events have vindicated our strategy
5
AGLR/Sequent's Approach
What We Do
Based on assets
Focused on specific geographies
Strong relationships
Utility empathy
Good corporate discipline
What We Don't Do
Pure speculation
Round trip trades
Have long-dated mark-to-model accounting
6
Sequent's Business Infrastructure
[Graphic depicts Sequent's office structure]
Front Office:  responsible for pricing, marketing, trade origination/capture, and scheduling.
Middle Office:  responsible for trade support, trade confirmation, contract administration, portfolio validation, and policy compliance.
Back Office:  responsible for management reporting, trade settlement, and accounting.
7
Asset Management Activities
Dana A. Grams
Vice President Asset Management
Sequent Energy Management
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Sequent Asset
Management Activities
Transportation and Logistics (place)
Storage (time)
Supply and Distribution
Services
9
Wholesale Market Hubs
[Map appears here]
10
[Map appears here]
11
Futures Pricing
NYMEX Natural Gas
[Graphic appears here]
12
Futures Pricing
NYMEX Natural Gas
[Graphic appears here]
13
Futures Pricing
NYMEX Natural Gas
[Graphic appears here]
14
Typical Example of
Storage Arbitrage*
Inject Gas into storage in May
Withdraw Gas and Sell to Market in January
Arbitrage
May 02 NYMEX
$3.00
May 02 Physical Basis
-.03
$2.97
January 03 NYMEX
$3.80
January 03 Physical Basis
-.03
$3.77
Margin
$0.80
Cost and Fees
$/MMBtu
Transportation to Storage
$0.07
Injection Fee
$0.10
Withdrawal Fee
$0.05
Time Value of Money
$0.12
Total Costs
$0.34
*Not differentiated by jurisdiction
15
Gas Supply and Distribution
Patrick J. Strange
Vice President Supply and Distribution
Sequent Energy Management
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Sequent's Supply and Distribution Activities
Gas Supply (acquisition/aggregation)
Transportation and Storage
Marketing
17
Sequent Counterparties
Producers
Pipelines
Markets
Adams Resources
Amerada Hess
Petrofina
Anadarko
Bass Enterprises
BP Amoco
Conoco Phillips
ExxonMobil
Houston Exploration
Hunt Exploration
Swift Energy
Total Fina
Unocal
ANR
Bridgeline
Centerpoint
Columbia Gas
Columbia Gulf
Destin
Dominion Transmission
East Tennessee
Florida Gas
Gulf South
Kinder Morgan Texas
Tennessee Gas
Texas Gas
Transco
Southern Natural
Alabama Gas Corp.
Ashland
Baltimore Gas & Electric
Bethlehem Steel
Carolina Power & Light
Columbia Gas
Delmarva
Entergy
Florida Power
International Paper
Michigan Consolidated
New Jersey Natural
PCS Nitrogen
SCANA
18
Natural Gas Storage Is An Important Part of Our Business
[Map appears here]
19
Transportation Logistics
"The sum of the parts is greater than the whole"
[Map appears here]
20
Looking Forward
Robert M. Flavin
Executive Vice President
Sequent Energy Management
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Future Directions:
Business Development
Filling the void for customers
Deepening contractual asset base
Developing relationships with strong counterparties
Maintaining the right risk/return profile
22
Formula for Success:
Industry Factors to Watch
Value and volatility of natural gas
Natural gas supply
Seasonality (hot summer/cold winters)
Market disruptions (hurricanes)
Market dislocations
Price and volatility of competitive fuels
23
Formula for Success:
Financial Resources
Required working capital
Provided by cash flow much of the year or short term borrowings from AGLR under money pool arrangement
$15 million Bank One line of credit covers margining on the commodity futures exchange
Typical month's working capital is minimal
Fixed capital deployment
Depreciation and Amortized items "negligible" at approximately $3 million
24
Wholesale Services Receivables/Payables
In millions
Gross Receivable
Gross Payable
Contracts with netting agreements in place:
Counterparty is investment grade
$87.6
$75.8
Counterpart is non-investment grade
11.2
16.0
Counterparty has no external rating
2.0
13.6
Contracts without netting agreements in place:
Counterparty is investment grade
6.2
16.6
Counterpart is non-investment grade
-
-
Counterparty has no external rating
-
0.4
Amount recorded on balance sheet
107.0
$122.4
As of 09/30/02
25
Formula for Success:
Financial Resources
Required working capital
Provided by cash flow much of the year or short term borrowings from AGLR under money pool arrangement
$15 million Bank One line of credit covers margining on the commodity futures exchange
Typical month's working capital is minimal
Fixed capital deployment
Depreciation and Amortized items "negligible" at approximately $3 million
26
Wholesale Services
Financial Performance
(in millions $)
Total 2001
First 9 Months 2002
Combined
Gross Margin
17.6
14.9
32.5
Operation Expenses
8.8
9.8
18.6
Taxes other than income
0.1
0.3
0.4
Total Operating Exp
9.0
10.1
19.1
Write off of Etowah LNG
-2.6
-2.6
Other Income
0.4
0.0
0.4
EBIT
6.4
4.8
11.2
27
Summary
We focus on business fundamentals.
Ours is a simpler business than those who have gone before us, not glamorous or risky.
We will grow it consistent with market timing and our ability to maintain a strong control environment.
28
Delivering Value through Risk Management
Gene Rozgonyi
Chief Risk Officer
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
{AGL Resources logo appears here}
Enterprise Risk
Board Level Finance and Risk Management Committee
Executive Risk Management Committee
Chief Risk Officer
Risk Observation, Reporting, & Recommendations
Weather
Commodity
Insurance
Treasury
Regulatory
Operational
Credit
Enterprise Risk
Expansive - The enterprise risk initiatives incorporate the efforts of traditional insurance, credit, capital allocation, quality movements, safety, and trading and marketing risk management.
Systematic - AGLR's Enterprise risk efforts are conducted thoughtfully and methodically throughout the corporation
Specific - The unique nature of each risk is addressed, understood, and managed to provide meaningful information.
Awareness - A risk aware culture is promoted in all business units.
Evolving - The risk management framework acts to support the continued development of metrics, analysis and observations.
Value - The enterprise risk efforts preserve and enhance value by effectively assessing and mitigating factors that affect the activities and earnings of the corporation.
AGLR "Umbrella" Risk Management Policy
Identification
Definition
Purpose
Instruments/Activities
Measurement Methodology
Monitoring
Limit Structure
Compliance
Responsibilities
Reporting
Sequent/Commodity Risk Management Policy
Fair Value Valuation Policy
Credit Policy and Procedures
Operations Risk Management Policy
Interest Rate Risk Management Policy
Credit Risk Management Policy
Earnings at Risk
Canvass - all business units for embedded risks.
Identify and quantify potential range of uncertainty around specific risks.
Create - the unique nature of each risk is addressed, understood, and managed to provide meaningful information.
Build Earnings at Risk (EaR) model.
Mitigate manageable exposures through the development of action plans.
Report findings to Risk Management Committee and Finance & Risk Management Committee.
Sequent Risk Profile
Asset backed operations
Arbitrage/ back to back transactions
Low open position results in a low VaR
Price transparency - short tenor transactions
Niche one-commodity, one region player - Southeast market
Top 10 counterparty exposure A- rated
Rolling best-practice diagnostics
Reported Risk Metrics
P&L daily, monthly, quarterly, year-to-date
1 and 20-day VaR
Scenario stress testing
Credit exposure metrics
Limit monitoring
{graphic of Sharpe Ratio 2.87}
Sharpe Ratio - Benchmarks
Mutual Funds:
Trading Systems:
Sharpe>0
Sharpe>0
Sharpe>1 "Pretty Good"
Sharpe>1 "Very Good"
Sharpe>2 "Outstanding"
Sharpe>2 "Outstanding"
Summary
Risk management is real-time and evolving activity
AGLR enterprise-wide, touches all business units
Deep engagement in business activities
On the trading floor daily
Driving force for implementing and maintaining best practices
Direct reporting to Board Finance and Risk Management Committee
Delivering Value
through Finance
Drew Evans
Vice President and Treasurer
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
[AGL Resources logo appears here]
Asset Deployment
Regulated businesses represent over 90% of total assets deployed
Under regulatory compact in 3 states
Wholesale Services has approximately $210 million in assets or 6% of total
Primarily storage positions and working capital requirements
Energy Investments has approximately $150 million in assets or 4% of total
AGL Networks, SouthStar, US Propane
[The following information is presented as a graphic]
Distribution Operations - 90%
Wholesale Services - 6%
Energy Investments - 4%
$3.5 Billion in total Assets
2
Assets and Liabilities
Nearly $3.5 billion of total assets and liabilities in our business
Book value of equity of approximately $760 million
Total debt of approximately $1.4 billion
Remainder represents AP/AR, deferred credits, income taxes, and accrued liabilities
Equates to debt to capitalization of 65%
[The following information is presented as a graphic]
Debt - $1,390 million
Equity - $760 million
3
Liability Composition
Total liabilities of approximately $1.4 billion
Comprised of standard and simple instruments
Bank Facility
Medium Term Notes
Senior Notes
Trust Preferred
Provides for flexibility across the issuance spectrum
[The following information is presented as a graphic]
Trust Preferred - $225 million
Senior Notes - $300 million
Medium Term Notes - $545 million
Short Term Debt - $320 million
As of 3Q02
4
Bank Facility
Bank Facility Renewed in August
Commercial Paper Program
$500,000,000 Credit Facility
$200,000,000 364-day facility
$300,000,000 Three-year facility
One year term-out option on the 364-day facility
Debt-to-Capitalization not to exceed 70%
Minimum Consolidated Net Worth of $586 million, plus 25% of net income and 80% of equity offering proceeds
Material Adverse Change clause only at Closing
Backstop to commercial paper
Very well subscribed
Paper prices very tightly to benchmarks
Goal is to maintain consistent bucketing of maturities to capture benefit in short term rates
50% 30-days or less
25% 30 to 60 days
25% 60 to 90 days
Issuance over 2003 has already begun
5
Maturity Schedule
[The following information is presented as a graphic]
Millions
2002
$48.0
2003
$30.0
2004
$33.5
2005
$42.0
2006
$10.0
2011
$300.0
2012
$15.0
2013
$69.1
2014
$7.2
2015
$11.2
2017
$22.0
2019
$43.5
2021
$30.0
2022
$46.0
Thereafter
$362.5
Burden of refinancing given current maturity schedule is very light
Goal is to allow near term maturities to be absorbed into short term debt
Allows for more liquid and better priced instruments to be issued
6
Fixed to Floating Mix
Very near targeted levels
To increase the percentage of floating in the mix, AGLR entered into a fixed-for-floating swap in Nov. '01
Currently produces about $900k in positive carry each quarter
Currently has a market value in excess of $3 million
We will take advantage of the historically low yields on corporate bonds
[The following information is presented as a graphic]
Floating Debt - 28.4%
Fixed Debt - 71.6%
As of 3Q02
7
Contingent Capital
AGLR has contracts with adequate assurance provisions relating to trade credit/payment on behalf of Sequent
Normal course of business assurances
Small percentage of contracts would require cash collateralization if AGLR were downgraded below investment grade
Total capital outflow would be $22.3 million
Value is disclosed in recent 10Q and will be reported prospectively
8
Ratings
Currently BBB+, Baa1 and BBB+ with S&P, Moody's and Fitch respectively
Slightly more levered than the benchmark, AGLR continues to exceed goals established with agencies when VNG was acquired
Continue to keep the agencies apprised of our activities
9
Pension
Pension asset has suffered same fate as majority of Fortune 500 and is 14 percent smaller than year-end 2001
Pension was fully funded at that time
Due to decline in asset value and reduction in rate used to discount asset, an unfunded "ABO" may exist at the end of the plan year
AGLR is currently looking at alternatives to reduce the impact of this shortfall, including:
Funding entire shortfall to reduce impact on common equity
Partial funding to allow the asset value to grow
10
Summary
Continue to have good access to capital
Minimal contingent liabilities
Actively manage to maintain solid investment-grade ratings
11
Delivering Value through AGL Networks
Eric Martinez
Executive Vice President
AGL Networks
Analyst Conference
November 6-8, 2002
Miami, Florida
{AGL Resources logo appears here}
Agenda
AGL Network Overview
Business Model
Strategy and Tactics
Why Our Model Will Succeed
Financials
Growth
AGLN Overview
First, Some Definitions
POP
(Point of Presence) - The point at which a line from a long distance carrier (IXC) connects to the line of the local telephone company or to the user directly.
CO
(Central Office) - a telephone company building that houses switching equipment for connecting other subscribers to each other, locally and long distance
Carrier Hotel
- a term for a building that houses many local and long distance telephone companies, usually owned by a "disinterested" third party
Colocation
- a competing phone company providing network connections to several carriers housed together in a server room.
RBOC
(Regional Bell Operating Company) - the dominant local phone carrier within a specific geographic region (i.e. Bell South)
CLEC
(Competitive Local Exchange Carrier) - a local phone company that competes with the ILEC (i.e. MFN, Time Warner Telecom, Level 3, Winstar)
Signaling Speeds
T-1/DS-1
24
Simultaneous Digitized signals
DS-3
28
T-1's
45 Mbps
OC-3
3
DS-3
155 Mbps
OC-3
3
DS-3
155 Mbps
OC-12
12
DS-3's
622 Mbps
OC-48
48
DS-3's
2,448 Mbps
OC-192
192
DS-3's
10,000 Mbps
Telecomm Schematic
Current Network View
POP
CO
Internet
COLO
Long distance
Internet
ILEC/CLEO
tandem
CO
POP
Long distance
Fiber View
{graphic of metro Atlanta network}
Business Model
Infrastructure Provider
Conduit
Dark Fiber
Metropolitan Networks
Distressed Assets
Connectivity to Building Wall - "Revenue Ready"
Connectivity to Wireless and Next Generations
{Map of metro Atlanta network}
Atlanta Network
175 miles
8 conduits
8 rings
Location
Downtown
Midtown
Buckhead
Sandy Springs
Galleria
Airport
Alpharetta
Connected to
Carrier hotels
POP's
LSO's
Enterprise Buildings
Target Market
Interexchange Carrier
IXC's (Carriers) preceded development of local infrastructure
They rely on their own national backbone for transport and depend on metro access providers for dark fiber rings in the metro core
The lack of local fiber is the reason much of the long-haul fiber is unused
IXCs and the metro providers will need fiber facilities in the
last mile
to compete in end-to-end services
Target Market
Regional Bell Operating
Companies (RBOC's)
What they require:
Fiber capacity/connectivity needs vs copper
Redundancy
Local capabilities for out-of-region RBOCs for their largest customers
Out of region RBOC, not relying on in region RBOC, for facilities
Infrashare - Large capital investments dispersed amongst several players
Target Market
Enterprise/Institutions
Data-rich applications are requiring more capacity to move information between users in a timely manner.
Video conferencing
Check imaging and credit card processing
Storage Area Networks
Internet traffic grew approximately 100% in 2001. Data traffic now constitutes well over half of all network traffic (vs. voice)
Local RBOC infrastructure does not address needs quickly or cost-effectively
Source: Telecommunications Industry Association (TIA), Sept. 2002
A Balanced Portfolio
{Pie chart depicting Contract Valuation Year-to-Date 2002}
Enterprise 49%
IXCs 29%
ISPs 17%
Universities 5%
Opportunities for AGL Networks
In-place assets are available at cents on the dollar
Competitors' business strategies and infrastructure are not geared toward dark fiber sales
Customers uneasy over bankruptcies of large providers
RBOCs' tariff structures and marketing practices do not allow them to be competitive
Inexpensive electronics allow enterprise customers to "light" their own networks
How We Make Money
All transactions thus far are term leases rather than asset sales, predominantly with upfront cash
467 tax code applies, which allows for the receipt of cash up-front, while taxes are paid over the term of the lease
Revenue is recognized over the term of the contract
Possibility of asset sales remains to anchor incremental markets
What We Have Learned From Others
Poor market positioning - No differentiation between "me too" strategies, everyone had to own their own system
Overly optimistic demand growth forecasts - High expectations on penetration and up-selling opportunities in all market segments
Terrible CAPEX Management - Overspent on assets to implement poorly managed growth creating too much debt load
Low barriers to entry - Capital too easily available, enticing market entrants
Poor management practices - Limited controls, reliance on continued equity appreciation to cover mistakes, "shoot from the hip" strategies
Capital Invested 2002
{bar graph appears here Q1, Q2, Q3 & Q4 (estimates): Total Year-end CAPEX: $32.5M}
2002 YTD Financial Summary
{bar graph appears here Earned Revenue, Deferred Revenue, Cash & Capital}
Totals
(in millions of dollars):
Earned Revenue
$1.6
Deferred Revenue
$18.9
Cash
$13
Capital
$22.5
2002 Year-End Estimate
{bar graph appears here Earned Revenue, Deferred Revenue, Cash & Capital}
Totals
(in millions of dollars):
Earned Revenue
$1.9
Deferred Revenue
$33.9
Cash
$34.5
Capital
$32.5
Growth Strategy
Increase utilization through leasing
Penetrate additional markets
Create new services
Future Growth  - Increase Utilization
Fiber Miles in Inventory
{
Pie graph appears here: 96% Available; 4$ Sold}
Future Growth - New Cities
Growth Strategy
Turnkey
St. Louis
Kansas City
Richmond
Anchor Tenet
Atlanta
Phoenix
Infrastructure
Exploring potential of cities with similar characteristics to Atlanta
{map of United States appears here: Phoenix, Kansas City, St. Louis, Richmond, and Atlanta}
City Selection Criteria
Sun Belt locale, growing from our southeast sphere of influence
Tier 1 city or population greater than 2 million
Retail Revenue must be greater than $1 billion
Competition
Footprint
Business Plans
Companies
Asset investment
Must be able to own conduit and interest in manholes
Distressed
City relations
Customers - anchor tenet pulling us there
{map of metro Phoenix network appears here}
Phoenix Network
60 miles
1 conduit
3 rings
Location
Downtown
Midtown
Airport
Connected to
Carrier hotels
POP's
LSO's
Phoenix vs Atlanta
Phoenix
Entered by buying bankrupt asset
Third party provides maintenance
60 conduit miles
17,280 fiber miles
545 businesses over 250 employees
10 headquarters of Fortune 1000
Atlanta
Entered by buying bankrupt asset
We provide maintenance
175 conduit miles
Approx. 50,000 fiber miles
774 businesses over 250 employees
24 headquarters of Fortune 1000
Future Growth - Services
Wireless Industry
Wireless represents 12% of all calls today, expected to grow to 25% by 2005*
Due to higher capacity applications being introduced for wireless devices, bandwidth is growing at 130% per year**
Looking for high speed and low speed solutions
*Insight Research Corporation - 4/2002
**CIBC - 2002
Cell Site Express
Leverages our existing asset
Connect towers straight to the MSCs
Sell the equivalent of T1 service to the wireless carriers
Sell - Build
{graph of network}
Opportunities
Combination of upfront cash and solid corporate credit enabled us to pursue these opportunities
Over time, others can replicate certain aspects of the model
Must be one step ahead on:
Execution
Marketing
Service innovation
Horizontal integration
Delivering Value
Paula G. Rosput
Chairman, President and CEO
AGL Resources
Analyst Conference
November 6-8, 2002
Miami, Florida
{AGL Resources logo appears here}
Corporate Governance
Board of Directors
Executive Committee
Corporate Responsibility Committee
Nominations & Corporate Governance Committee
Audit Committee
Finance and Risk Management Committee
Compensation Committee
Significant Milestones in Governance
07/01 Formed Nominations and Corporate Governance Committee
09/01 Formed Risk Management Committee
01/02 CEO Performance Review
08/02
Sarbanes-Oxley Act signed
Consultant for Compensation Committee
09/02 Engaging consultant to expand board
Board frequently meets in executive session without management present
Deep engagement around asset management
Only one insider on board (Paula Rosput)
Independent director is chair of Executive Committee
Next Milestones
December board planning meeting
Will issue guidance in January
Late January earnings announcement and file 10-K in late February
Annual report mailing mid-March
Annual meeting April 16, 2003
AGA Update
Still Building . . .
VALUE
Commercial Sensibility
Regulatory Expertise
Operational Best Practices
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
AGL RESOURCES INC.
(Registrant)
Date:  November 7, 2002
/s/ Richard T. O'Brien
Executive Vice President and Chief Financial Officer