For Release: 12/07/2009

Integrys Energy Services Closes Sale of Wholesale Natural Gas Marketing Business

Integrys Energy Group’s collateral support requirements expected to be reduced by approximately $440 million when two-part transaction is completed in early 2011

Chicago, IL – Integrys Energy Group, Inc. (NYSE: TEG) today announced that its nonregulated subsidiary, Integrys Energy Services, Inc., (Energy Services) on Friday closed the first transaction in the previously announced two-part sale of its wholesale natural gas marketing business. The transaction, which received the required approvals from the Federal Energy Regulatory Commission, does not include or directly affect the retail natural gas and electric marketing business operated by Integrys Energy Services.

The first part of this transaction involved the sale of substantially all of Energy Services' wholesale natural gas marketing business to Sequent Energy Management L.P. (Sequent). The sale is expected to reduce collateral support requirements by $290 million.

The second part of this transaction includes 11.5 Bcf of storage contracts. Between now and April 2011, Integrys Energy Services will provide Sequent with fee-based services related to approximately 8 Bcf of the 11.5 Bcf total retained storage contracts. The remaining 3.5 Bcf of the retained storage will be divested in the normal course of business and is expected to be completed in the first quarter 2010. At the completion of the provision of the fee-based services to the buyer in April 2011, Energy Services anticipates selling the remaining 8 Bcf of the storage contracts, which will result in an expected reduction in collateral support requirements by an additional $150 million.

Other financial terms and conditions are not being disclosed at this time.

The transactions are consistent with the ultimate goals of the Integrys strategy to reduce capital investment and collateral support requirements for Integrys Energy Services. 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 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).

More information about Integrys Energy Group, Inc. is available online at www.integrysgroup.com.

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