Bay State Gas delcares regular dividends.

WESTBOROUGH, Mass.--(BUSINESS WIRE)--Oct. 24, 1996--The directors of Bay State Gas Company (NYSE: BGC) today declared a regular quarterly dividend of $0.385 per common share payable December 1, 1996 to shareholders of record on November 15, 1996.

The board also declared regular quarterly dividends today on the company's cumulative preferred stocks, all payable, January 1, 1996 to shareholders of record on November 15, 1996.

              Par                Amount
Series        Value              Per Share

$3.80         $ 50               $0.95

5 5/8%        $ 50               $0.7125

$3.25         $ 50               $0.8125

7.2%          $ 50               $0.90

4.70%         $100               $1.17

5%            $100               $1.25

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Bay State Gas Company operates in three energy-related business segments -- Local Transportation, Energy Products & Services, and Energy Ventures. Bay State's Local Transportation business serves almost 300,000 natural gas customers in New England, and geographically, is the largest gas utility in New England, serving the states of Massachusetts, New Hampshire, and Maine. The company's nonregulated Energy Products & Services segment offers energy commodities and related equipment and services to customers throughout New England under the brand name, "EnergyUSA." Bay State's Energy Ventures segment develops businesses and projects which are closely related to the company's core businesses. Additional information about Bay State is available on the World Wide Web at "http://www.bgc.com/bgc/."

CONTACT: Bay State Gas Company

Carol Churchill, 508/836-7370