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PORT HURON, Mich., Dec. 31 2004 – LAWFUEL – Best for law news…

PORT HURON, Mich., Dec. 31 2004 – LAWFUEL – Best for law news — SEMCO ENERGY, Inc. (NYSE: SEN) today announced that it has reached a settlement with Atlas
Pipeline Partners, L.P. to resolve a pending American Arbitration Association
proceeding. Atlas brought that proceeding against SEMCO over the termination
of an agreement to sell SEMCO’s Alaska Pipeline Company subsidiary (APC) to
Atlas. APC transmits natural gas from producing areas in Alaska’s Cook Inlet
region to customers of SEMCO’s ENSTAR Natural Gas Company division in
Anchorage and the surrounding area. Atlas initiated the proceeding in July
2004, alleging that SEMCO breached and wrongfully terminated the agreement to
sell APC. In its action, Atlas sought compensatory damages of not less than
$94.3 million.

The settlement finalized on December 31, 2004, calls for SEMCO to pay
Atlas $5.5 million immediately and for both parties to release all APC sale-
related claims. By entering into the settlement, SEMCO and Atlas have not
admitted or conceded any wrongdoing or liability relating to the dispute.
SEMCO and Atlas will each bear their own litigation costs. SEMCO will
continue to own and operate APC.

George A. Schreiber Jr., President and Chief Executive Officer of SEMCO
ENERGY, Inc., commented: “This settlement allows SEMCO to start 2005 without
the uncertainty of the APC situation overhanging the Company’s operations and
strategic development plans. We will continue to focus on enhancing SEMCO’s
profitability and on growing our regulated natural gas distribution
businesses.”

SEMCO ENERGY, Inc. distributes natural gas to more than 392,000 customers
combined in Michigan, as SEMCO ENERGY GAS COMPANY, and in Alaska, as ENSTAR
Natural Gas Company. It also owns and operates businesses involved in propane
distribution, intrastate pipelines and natural gas storage in various regions
of the United States.

British MP George Galloway and his opponent the Daily Telegraph will leave no stone unturned to sort out what could be a spectacular libel case.