King & Spalding Obtains $172 Million Arbitration Award for Sempra Energy

HOUSTON, TX--(Marketwire - October 2, 2007) - King & Spalding, a leading international law firm, announced today that its international arbitration team has earned a key victory for Sempra Energy in the company's claim against the government of Argentina. King & Spalding won $172 million for its client, making this award one of the five largest ever granted by the International Centre for Settlement of Investment Disputes (ICSID), an organization of the World Bank Group.

The dispute arose from the passage of Argentina's so-called "Emergency Law" in January 2002, during the height of Argentina's 2001-2002 economic crisis. The law "pesified" (i.e., converted from U.S. dollars to Argentine pesos) and froze all public utility tariffs, including those of Sempra Energy's interests in two gas distribution companies, Camuzzi Gas del Sur S.A. (CGS) and Camuzzi Gas Pampeana S.A. (CGP). The effect of these measures severally affected both CGS and CGP. Sempra Energy also claimed millions of dollars in unpaid subsidies for the distribution of natural gas.

Sempra Energy claimed that the "Emergency Law" measures and the failure to timely pay the subsidies violated the terms of CGS and CGP's licenses and Argentina's obligations to Sempra Energy under the bilateral investment treaty (BIT) between the United States and Argentina. Argentina defended the measures as justified on the basis of the economic crisis the country faced. The ICSID tribunal accepted Sempra Energy's claim and rejected Argentina's defenses, finding that Argentina's measures violated the provisions in the BIT guaranteeing fair and equitable treatment and the observation of all obligations entered into with regard to Sempra Energy's investment in CGS and CGP.

On September 28, 2007, ICSID awarded $172 million in compensation, including pre-award interest, to Sempra Energy. This award brings to more than $500 million the total amount awarded to firm clients with claims against Argentina.

The Houston-based King & Spalding team representing Sempra Energy was led by partners R. Doak Bishop and Craig S. Miles, who were assisted by associates Roberto J. Aguirre Luzi, Wade M. Coriell and Martin F. Gusy.

King & Spalding has one of the leading international arbitration practices in the world, specializing in oil and gas and energy disputes, foreign investment disputes against governments and disputes involving Latin American projects. American Lawyer's Focus Europe survey in June 2007 ranked King & Spalding second in the world in the number of high-stakes international arbitrations and first overall in investment treaty arbitrations. Lawyers in the firm's international arbitration group have represented major U.S. and foreign companies as well as foreign state-owned companies in arbitrated disputes ranging from one million dollars to more than one billion dollars.

About King & Spalding

King & Spalding is an international law firm with more than 800 lawyers in Atlanta, Charlotte, Dubai, Frankfurt, Houston, London, New York, Riyadh (affiliated office) and Washington, D.C. The firm represents half of the Fortune 100 and in a Corporate Counsel survey in September 2007 was among the top firms representing Fortune 250 companies. For additional information, visit www.kslaw.com.

Contact Information: Contact: Matt Hyams King & Spalding Ph: 212.827.4057