News Release

Feb. 24, 2003

Roadwork Creates Unique Opportunity for PNM to Improve
Tesuque Reliability Without Norton-Tesuque Power Line

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NEWS MEDIA CONTACT Susan Sponar Telephone: (505) 241-2768

Santa Fe: A road-widening project on state Highway 285 north of Santa Fe this spring will allow PNM to strengthen the area's electric system without building the proposed high-voltage Norton-Tesuque power line, company officials said today.

In concert with the roadwork to be done by the New Mexico State Highways and Transportation Department, PNM plans to install a smaller line, known as a distribution line, along Highway 285 to improve electric reliability for Tesuque Pueblo, the Village of Tesuque, and the area of Chupadero. Reliability problems in the Tesuque area are what prompted PNM in 1995 to begin construction of the 11-mile Norton-Tesuque transmission line. That line was to run from PNM's Norton Station, northwest of Santa Fe, to a proposed new substation on Tesuque Pueblo land.

"This is a benefit for all parties involved, including PNM customers in the area, those folks who opposed the new transmission line, and the company itself," said Roger Flynn, PNM's chief operating officer. "When this smaller line is permitted and built, we will be able to improve reliability for these customers without building the Norton-Tesuque transmission line."

Before proposing the Norton-Tesuque project, PNM considered several other options, including running the distribution line along Highway 285. After it became clear these other options were either not feasible or right-of-way could not be obtained, PNM decided to begin construction of the Norton-Tesuque line. After PNM recently learned of the impending work on Highway 285, the company asked the highway department for permission to build the smaller line while road construction is under way. The department has now included PNM's line in its plans for the road project.

A lawsuit regarding the Norton-Tesuque project is currently pending in federal court. PNM today proposed to the parties involved that the lawsuit be withdrawn, Flynn said.

Construction on the new distribution line will begin in April and should be complete in June. Beginning at the intersection of Bishops Lodge Road and Camino Encantado, and ending at the intersection of County Road 22 and Highway 285, the project involves the maintenance and upgrade of 12,500 feet of existing conductor and the installation of 15,500 feet of new cable.

Flynn said the Norton-Tesuque line is unrelated to other transmission projects being considered for Santa Fe and that the company's decision on Norton-Tesuque will not affect those projects.

PNM is the principal subsidiary of PNM Resources, an energy holding company based in Albuquerque. PNM provides natural gas service to 441,000 gas customers and electric utility service to 378,000 customers in New Mexico. The company also sells power on the wholesale market in the Western U.S. PNM Resources stock is traded primarily on the NYSE under the symbol PNM.