MDU Resources Announces Agreement to Acquire South Texas Production As

    Business Editors

    BISMARCK, N.D.--(BUSINESS WIRE)--April 25, 2005--MDU Resources Group, Inc. (NYSE:MDU) announced that, on April 19, 2005, its indirect wholly owned subsidiary, Fidelity Exploration & Production Company (Fidelity), signed Purchase and Sale Agreements to acquire natural gas and oil properties from a Houston-based independent producer for an aggregate cash purchase price of $145 million, subject to accounting and purchase price adjustments customary for oil and natural gas acquisitions of this type.
    The acquisition is expected to close in May 2005, conditional upon completion of a due diligence process, including environmental reviews, and satisfaction of other standard closing conditions. Funds for the acquisition are expected to be provided from a combination of cash on hand and available debt capacity. Upon closing, the company anticipates the acquisition will be accretive to earnings per share and cash flow. The properties being acquired are located in south Texas with primary production from the Frio and Vicksburg formations. The seller will continue to operate one of the production fields and Fidelity will operate the rest of the acquired properties.
    The information in this release includes certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements contained in this release, including those with respect to the anticipated effect of the transaction upon earnings per share and cash flow, are expressed in good faith and are believed by the company to have a reasonable basis. Nonetheless, actual results may differ materially from the projected results expressed in the forward-looking statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include the ability to effectively integrate the acquired properties; fluctuations in natural gas and crude oil prices; fluctuations in commodity price basis differentials; drilling successes in natural gas and oil operations; the ability to contract for or to secure necessary drilling rig contracts and to retain employees to drill for and develop reserves; market demand for, and/or available supplies of, energy products and services; and the effects on operations of extensive environmental laws and regulations. For a discussion of other important factors that could cause actual results to differ materially from those expressed in the forward-looking statements, refer to Part I and Part II, Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations - Risk Factors and Cautionary Statements that May Affect Future Results, in the company's most recent Form 10-K and Form 8-K filed April 19, 2005.

    MDU Resources Group, Inc., a member of the S&P MidCap 400 index, provides value-added natural resource products and related services that are essential to energy and transportation infrastructure. MDU Resources includes natural gas and oil production, construction materials and mining, domestic and international independent power production, electric and natural gas utilities, natural gas pipelines and energy services, and utility services. For more information about MDU Resources, see the company's Web site at www.mdu.com or contact the investor relations department at investor@mduresources.com.

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CONTACT: MDU Resources Group, Inc., Bismarck Warren Robinson, 701-222-7991 or Cathi Christopherson, 701-222-7959

KEYWORD: TEXAS NORTH DAKOTA INDUSTRY KEYWORD: OIL/GAS BANKING ENERGY UTILITIES MERGERS/ACQ SOURCE: MDU Resources Group, Inc.

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