(The following statement was released by the rating agency)

Dec 11 - Fitch Ratings has affirmed the outstanding ratings for NiSource

Inc. (NI) and its subsidiaries as fully listed at the end of this

release. The affirmations include NiSource Finance Corp. (NiSource Finance) and

NiSource Capital Markets Inc., NI's two financing subsidiaries and Northern

Indiana Public Service Co. (NIPSCO), an electric and gas utility. The Rating

Outlooks are maintained at Stable. Approximately $7.2 billion of long-term debt

is affected by the rating actions.

KEY RATING DRIVERS: NI's rating and Stable Outlook reflect the low business risk

and consistent operating performance generated by its geographically diverse mix

of regulated operations. Other considerations include the long-term financial

impact of aggressive pipeline and gas utility system modernization programs and

electric environmental capital expenditures, with a substantial portion of

recoveries expected to be received through tracking mechanisms and relatively

weak credit metrics at NI.

FORWARD EXPECTATIONS: NI's financial profile is expected to remain consistent

with its current rating though its current multi-year infrastructure-build

cycle. Fitch projects NI's 2012 debt to EBITDA to be approximately 5.0x.

Typically NI's leverage peaks at the end of the year as a result of seasonal gas

storage purchases at its gas utilities and drops during the following months as

gas costs are recovered. Leverage ratios modestly strengthened during 2012

primarily benefiting from new electric rates effective Dec. 27, 2011, $339

million forward equity sale in September 2012, and the timely financial recovery

under tracking mechanisms of a significant portion of NI's capital expenditures.

LIQUIDITY: NI's liquidity is expected to be adequate. NiSource Finance has a

$1.5 billion revolving credit facility that matures in May 2017. The company

also issues 'F3' rated commercial paper under a $500 CP program that is

backstopped by the revolver. The revolver has one financial covenant which sets

a maximum consolidated debt-to-cap ratio of 70%. The revolver also includes

limitations on liens and restrictions on asset sales. At the end of the third

quarter of 2012 NI had approximately $1.439 billion in net available liquidity.

NI also has a total of $515 million of accounts receivable securitization

facilities as follows: $240 million at Columbia Gas of Ohio; $200 at NIPSCO; and

$75 million at Columbia Gas of Pennsylvania. Upcoming debt maturities at

NiSource Finance include $420 million of notes due 2013 and at NIPSCO $68

million due 2013.

RATING TRIGGERS

Positive: Future developments that may, individually or collectively, lead to a

positive rating action include: reduced regulatory risk with expanded revenue

tracking mechanisms and improving credit metrics through some combination of

earnings growth and/or debt reduction.

Negative: Future developments that may, individually or collectively, lead to a

negative rating action include: unfavorable regulatory decisions and higher than

anticipated leverage which could result should NI not issue adequate equity to

help fund its significant capital program. Debt to EBITDA above 5.5x on a

sustained basis would be a catalyst for a negative rating action.

The following ratings have been affirmed with a Stable Outlook:

NiSource Inc.

--Issuer Default Rating (IDR) at 'BBB-'.

NiSource Finance Corp.

--IDR at 'BBB-';

--Senior unsecured 'BBB-'

--Short term IDR 'F3';

--Commercial paper 'F3.

NiSource Capital Markets

--IDR 'BBB-';

--Senior unsecured 'BBB-'.

Northern Indiana Public Service Co.

--IDR 'BBB-';

--Senior unsecured and revenue bonds 'BBB'.

Additional information is available at 'www.fitchratings.com'. The ratings

above were solicited by, or on behalf of, the issuer, and therefore, Fitch has

been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'Corporate Rating Methodology' (Aug. 8, 2012);

--'2013 Outlook: Natural Gas Pipelines and MLPs' (Nov. 30, 2012);

--'Pipelines, Midstream, and MLP Stats Quarterly - Second Quarter 2012' (Sept.

27, 2012);

--'Marcellus Shale Report: Midstream and Pipeline Sector Challenges and

Opportunities' (June 10, 2012);

--'Top Ten Questions Asked by Pipeline, Midstream, and MLP Investors' (May 1,

2012);

--'Natural Gas Pipelines: Hot Topics' (Oct. 13, 2011).

Applicable Criteria and Related Research:

Corporate Rating Methodology

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=684460

2013 Outlook: Natural Gas Pipelines & MLPs

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=695939

Pipelines, Midstream, and MLP Stats Quarterly -- Second-Quarter 2012

(Second-Quarter Review)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=689669

Marcellus Shale Report: Midstream and Pipeline Sector --

Challenges/Opportunities

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=682755

Top Ten Questions Asked by Pipeline, Midstream and MLP Investors

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=679549

Natural Gas Pipelines: Hot Topics -- Long-Term Trends Affecting Pipeline Risk

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=652851

(New York Ratings Team)

(e-mail: pam.niimi@thomsonreuters.com; Reuters Messaging: pam.niimi.reuters.com@reuters.net; Tel:1-646-223-6330;)

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