For Release: 07/17/2009

Integrys Energy Services of Canada Corp. Signs Agreement to Divest Large Part of its Canadian Natural Gas and Electric Power Contract Portfolio

Divestiture reduces Integrys Energy Group’s collateral requirements by $300 million

Chicago – July 17, 2009 – Integrys Energy Group, Inc. (NYSE: TEG) today announced that Integrys Energy Services of Canada Corp., a subsidiary of its nonregulated subsidiary, Integrys Energy Services, Inc., has signed an agreement to sell nearly all of its Canadian natural gas and electric power contract portfolio to Shell Energy North America (Canada) Inc., a subsidiary of Shell Energy North America (US). The transaction, which requires certain contractual consents and necessary regulatory approvals, is expected to close in the third quarter of 2009.

Upon close, the transaction will result in an incremental reduction of Integrys Energy Group’s collateral requirements by an estimated $300 million.

"This sale is one step on the way to our objective of reducing the collateral requirements and capital investment for Integrys Energy Services," said Charles A. Schrock, President and Chief Executive Officer of Integrys Energy Group. "We are pleased to have reached an agreement with Shell Energy North America at a value that is in keeping with our recovered capital expectations for the full nonregulated segment divestiture. This deal, as part of our structured capital redeployment process, will reduce our collateral requirements, strengthening our balance sheet to support the growth of our core regulated utilities business."

The portion of the Canadian wholesale natural gas operation excluded from this transaction is a 2 Bcf natural gas storage contract, which Integrys plans to divest in a separate transaction.

J.P. Morgan Securities acted as exclusive financial advisor to Integrys Energy Group and Thorndike Landing acted as lead advisor to Integrys Energy Services for this transaction.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. You can identify these statements by the fact that they do not relate strictly to historical or current facts and often include words such as "anticipate," "expect," "intend," and other similar words. Forward-looking statements are beyond the ability of Integrys Energy Group to control and, in many cases, Integrys Energy Group cannot predict what factors would cause actual results to differ materially from those indicated by forward-looking statements. Please see Integrys Energy Group’s periodic reports filed with the Securities and Exchange Commission (including its 10-K and 10-Qs) for a listing of certain factors that could cause actual results to differ materially from those contained in forward-looking statements.

About Integrys Energy Group, Inc.

Integrys Energy Group is a diversified holding company with regulated utility operations operating through six wholly owned subsidiaries, Wisconsin Public Service Corporation, The Peoples Gas Light and Coke Company, North Shore Gas Company, Upper Peninsula Power Company, Michigan Gas Utilities Corporation, and Minnesota Energy Resources Corporation; nonregulated operations serving the competitive energy markets in the United States and Canada through its wholly owned nonregulated subsidiary, Integrys Energy Services; and also a 34% equity ownership interest in American Transmission Company LLC (an electric transmission company operating in Wisconsin, Michigan, Minnesota, and Illinois).

About Shell Energy North America

Houston-based Shell Energy, a wholly owned subsidiary of Royal Dutch Shell plc, (Shell) serves its customers through its regional offices, which are located throughout the United States and Canada. Shell Energy is an integral part of the Shell Trading network of companies and is the primary marketer of Shell’s equity natural gas in North America. As a leader in gas and power marketing, Shell Energy and its subsidiaries, trade and market natural gas, wholesale power, environmental products and risk management products with counterparties and customers throughout the region. As a part of Shell, it leverages Shell’s resources, global reach, employee expertise and financial strength to offer integrated, comprehensive energy solutions tailored to meet the needs of its wide variety of customers including large commercial and industrial users, local gas distribution companies, electric utilities, independent power producers, retail energy aggregators and oil and gas companies. More information about Shell Energy is available at www.shell.com/us/energy.

Shell is one of North America's leading oil and natural gas producers, natural gas marketers, gasoline marketers and petrochemical manufacturers. Operating in Canada since 1911, Shell Canada Limited is one of the largest integrated petroleum companies in the country in which it produces natural gas, natural gas liquids and bitumen, and is Canada’s largest producer of sulphur. In the United States, Shell Oil Company is one of the leading oil and gas producers in the deepwater Gulf of Mexico, and is a recognized pioneer in oil and gas exploration and production technology.

Royal Dutch Shell plc is incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges. Shell companies have operations in more than 100 countries with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects, including wind and solar power.

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