UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                         Amendment No. 1 on Form 10Q/A
                                    to Form 10-Q
(Mark One)
 X   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
---
EXCHANGE ACT OF 1934

For the quarterly period ended         September 30, 2000
                               -----------------------------------------------

                                                                  OR
     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
---
EXCHANGE ACT OF 1934

For the transition period from                        to
                               ----------------------    ---------------------

                         Commission file number 1-14161
                                    --------

                               KEYSPAN CORPORATION
                              ---------------------
             (Exact name of Registrant as specified in its charter)

              New York                                   11-3431358
-----------------------------                ---------------------------------
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)


                 One MetroTech Center, Brooklyn, New York 11201
              175 East Old Country Road, Hicksville, New York 11801
           -----------------------------------------------------------
               (Address of principal executive offices) (Zip Code)


                            (718) 403-1000 (Brooklyn)
                           (631) 755-6650 (Hicksville)
                          -----------------------------
              (Registrant's telephone number, including area code)


(Former name,former address and former fiscal year, if changed since last
report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X No

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
   Class of Common Stock                        Outstanding at October 26, 2000
---------------------------                    --------------------------------
      $.01 par value                                       134,642,772


<PAGE>

EXPLANATORY NOTE:

           The Company hereby amends Part I of its quarterly report on Form 10-Q
for the period  ended  September  30,  2000 to reflect  the  inclusion  of a new
footnote No. 9, which footnote  includes  summary  financial data of KeySpan Gas
East Corporation, a wholly owned subsidiary of the Company, as required by Staff
Accounting  Bulletin 53. No other changes to the financial  statements set forth
herein have been made.

                      KEYSPAN CORPORATION AND SUBSIDIARIES

                                      INDEX

                   Part I.   FINANCIAL INFORMATION                     Page No.
                                                                       --------

Item 1. Financial Statements

        Consolidated Balance Sheet -
        September 30, 2000 and December 31, 1999                           3

        Consolidated Statement of Income -
        Nine Months Ended September 30, 2000 and 1999                      5

        Consolidated Statement of Cash Flows -
        Nine Months Ended September 30, 2000 and 1999                      6

        Notes to Consolidated Financial Statements                         7

Signatures                                                                17



                                        2

<PAGE>


<TABLE>

                                                      CONSOLIDATED BALANCE SHEET
                                                       (IN THOUSANDS OF DOLLARS)


<CAPTION>

                                                                SEPTEMBER 30, 2000                  December 31, 1999
----------------------------------------------------------------------------------------------------------------------------
                                                                 (Unaudited)                           (Audited)
----------------------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>                         <C>
ASSETS
CURRENT ASSETS
    Cash and temporary cash investments              $                    63,618     $                128,602
    Customer accounts receivable                                         609,890                      425,643
    Other accounts receivable                                            222,478                      235,156
    Allowance for uncollectible accounts                                 (26,281)                     (20,294)
    Special deposits                                                      42,485                       60,863
    Gas in storage, at average cost                                      260,738                      144,256
    Materials and supplies, at average cost                               95,004                       84,813
    Other                                                                 88,629                       98,914
                                                           ---------------------        ---------------------
                                                                       1,356,561                    1,157,953
                                                           ---------------------        ---------------------


EQUITY INVESTMENTS AND OTHER                                             427,557                      391,731
                                                           ---------------------        ---------------------

PROPERTY
    Electric                                                           1,386,206                    1,346,851
    Gas                                                                3,584,690                    3,449,384
    Other                                                                393,252                      375,657
    Accumulated depreciation                                          (1,688,283)                  (1,589,287)
    Gas exploration and production, at cost                            1,346,357                    1,177,916
    Accumulated depletion                                               (582,912)                    (520,509)
                                                           ---------------------        ---------------------
                                                                       4,439,310                    4,240,012
                                                           ---------------------        ---------------------

DEFERRED CHARGES
    Regulatory assets                                                    320,931                      319,167
    Goodwill, net of amortizations                                       350,552                      255,778
    Other                                                                357,610                      366,050
                                                           ---------------------        ---------------------
                                                                       1,029,093                      940,995
                                                           ---------------------        ---------------------

                                                           ---------------------        ---------------------
TOTAL ASSETS                                         $                 7,252,521     $              6,730,691
                                                           =====================        =====================

</TABLE>
               See accompanying Notes to the Consolidated Financial Statements.



                                        3

<PAGE>


<TABLE>
                                                      CONSOLIDATED BALANCE SHEET
                                                      (IN THOUSANDS OF DOLLARS)


<CAPTION>
                                                                            SEPTEMBER 30, 2000                  December 31, 1999
----------------------------------------------------------------------------------------------------------------------------------
                                                                             (Unaudited)                         (Audited)
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                        <C>                                     <C>
LIABILITIES AND CAPITALIZATION

CURRENT LIABILITIES
    Current redemption of preferred stock                       $                    -              $                  363,000
    Accounts payable and accrued expenses                                      670,869                                 645,347
    Commercial paper                                                           382,090                                 208,300
    Dividends payable                                                           61,276                                  61,306
    Taxes accrued                                                               90,195                                  50,437
    Customer deposits                                                           30,552                                  31,769
    Interest accrued                                                            23,879                                  28,093
                                                                     -----------------                       -----------------
                                                                             1,258,861                               1,388,252
                                                                     -----------------                       -----------------

DEFERRED CREDITS AND OTHER LIABILITIES
    Regulatory liabilities                                                      44,350                                  26,618
    Deferred income tax                                                        238,748                                 186,230
    Postretirement benefits and other reserves                                 542,596                                 501,603
    Other                                                                       95,018                                  66,200
                                                                     -----------------                       -----------------
                                                                               920,712                                 780,651
                                                                     -----------------                       -----------------

CAPITALIZATION
    Common stock, $.01 par value, authorized
       450,000,000 shares; outstanding 134,575,028 and
       133,866,077 shares stated at                                          2,987,242                               2,973,388
    Retained earnings                                                          481,658                                 456,882
    Accumulated foreign currency adjustment                                     (6,476)                                  7,714
    Treasury stock purchased                                                  (702,435)                               (722,959)
                                                                     -----------------                       -----------------
      Total common shareholders' equity                                      2,759,989                               2,715,025
    Preferred stock                                                             84,323                                  84,339
    Long-term debt                                                           2,120,752                               1,682,702
                                                                     -----------------                       -----------------
TOTAL CAPITALIZATION                                                         4,965,064                               4,482,066
                                                                     -----------------                       -----------------

MINORITY INTEREST IN SUBSIDIARY COMPANIES                                      107,884                                  79,722
                                                                     -----------------                       -----------------
TOTAL LIABILITIES AND CAPITALIZATION                            $            7,252,521              $                6,730,691
                                                                     =================                       =================
</TABLE>


               See accompanying Notes to the Consolidated Financial Statements.







                                        4

<PAGE>


<TABLE>
                                                   CONSOLIDATED STATEMENT OF INCOME
                                                             (Unaudited)
                                         (IN THOUSANDS OF DOLLARS, EXCEPT PER SHARE AMOUNTS)

<CAPTION>
                                                        THREE MONTHS        Three Months            NINE MONTHS        Nine Months
                                                           ENDED                Ended                  ENDED                Ended
                                                        SEPTEMBER 30,       September 30,          SEPTEMBER 30,       September 30,
                                                            2000                1999                   2000                 1999
--------------------------------------------------------------------------------------------- --------------------------------------
<S>                                                         <C>                 <C>                 <C>                 <C>
REVENUES
Gas Distribution                                       $     292,352 $           208,572  $          1,458,595 $         1,208,254
Electric Services                                            374,517             241,259             1,097,616             606,552
Gas Exploration and Production                                62,748              42,081               169,966             103,622
Energy Related Services and Other                            217,520              46,557               485,161             124,675
                                                          ----------   -----------------    ------------------   -----------------
Total Revenues                                               947,137             538,469             3,211,338           2,043,103
                                                          ----------   -----------------    ------------------   -----------------
OPERATING EXPENSES
Purchased gas for resale                                     140,415              68,195               717,140             498,609
Fuel and purchased power                                     161,086                   -               334,135                   -
Operations and maintenance                                   389,116             293,044             1,123,581             765,221
Depreciation, depletion and amortization                      72,973              63,130               216,364             180,698
Operating taxes                                               91,469              77,317               298,010             258,355
                                                          ----------   -----------------    ------------------   -----------------
Total Operating Expenses                                     855,059             501,686             2,689,230           1,702,883
                                                          ----------   -----------------    ------------------   -----------------

OPERATING INCOME                                              92,078              36,783               522,108             340,220
                                                          ----------   -----------------    ------------------   -----------------

OTHER INCOME AND (DEDUCTIONS)
Income from equity investments                                 4,405               4,268                16,333               9,749
Minority interest                                             (5,952)             (3,035)              (13,747)             (5,226)
Interest income and other                                       (259)              4,585                 6,510              27,679
                                                          ----------   -----------------    ------------------   -----------------
Total Other Income                                            (1,806)              5,818                 9,096              32,202
                                                          ----------   -----------------    ------------------   -----------------
INCOME BEFORE INTEREST CHARGES
  AND INCOME TAXES                                            90,272              42,601               531,204             372,422
                                                          ----------   -----------------    ------------------   -----------------
INTEREST CHARGES                                              42,781              28,045               120,106              98,824
                                                          ----------   -----------------    ------------------   -----------------
INCOME TAXES
    Current                                                    7,579             (23,111)              116,396             (14,886)
    Deferred                                                  25,282              28,651                54,462             113,258
                                                          ----------   -----------------    ------------------   -----------------
Total Income Taxes                                            32,861               5,540               170,858              98,372
                                                          ----------   -----------------    ------------------   -----------------
NET INCOME                                                    14,630               9,016               240,240             175,226
Preferred stock dividend requirements                          1,476               8,688                16,453              26,067
                                                          ----------   -----------------    ------------------   -----------------
EARNINGS FOR COMMON STOCK                              $      13,154 $               328  $            223,787 $           149,159
Foreign currency adjustment                                   (4,760)             (2,281)              (14,190)              3,454
                                                          ----------   -----------------    ------------------   -----------------
COMPREHENSIVE INCOME (LOSS)                            $       8,394 $            (1,953) $            209,597 $           152,613
                                                          ==========   =================    ==================   =================

BASIC AND DILUTED EARNINGS
    PER COMMON SHARE                                      $     0.10  $             0.00   $              1.67  $              1.06
                                                          ==========   =================    ==================   =================
AVERAGE COMMON SHARES OUTSTANDING (000)                      134,335             136,506               133,965             140,079
</TABLE>


               See accompanying Notes to the Consolidated Financial Statements.







                                        5

<PAGE>



<TABLE>
                                                 CONSOLIDATED STATEMENT OF CASH FLOWS
                                                             (Unaudited)
                                                      (IN THOUSANDS OF DOLLARS)

<CAPTION>
                                                              NINE MONTHS         Nine Months
                                                                 ENDED                Ended
                                                             SEPTEMBER 30,        September 30,
                                                                 2000                 1999
------------------------------------------------------- ------------------------------------------
<S>                                                         <C>                 <C>
OPERATING ACTIVITIES
Net Income                                                    240,240 $           175,226
ADJUSTMENTS TO RECONCILE NET INCOME TO
NET CASH PROVIDED BY (USED IN)
OPERATING ACTIVITIES
    Depreciation, depletion and amortization                  216,364             180,698
    Deferred income tax                                        54,462             113,258
    Income from equity investments                            (16,333)             (9,749)
    Dividends from equity investments                          19,568               6,375
CHANGES IN ASSETS AND LIABILITIES
    Accounts receivable                                       (38,759)            155,538
    Materials and supplies, fuel oil and
         gas in storage                                      (128,705)            (18,997)
    Accounts payable and accrued expenses                      27,451            (143,858)
    Interest accrued                                          (12,269)            (11,050)
    Special deposits                                           18,378              55,050
    Prepayments and other                                      86,803             (59,437)
                                                    -----------------    -----------------
Net Cash Provided by Operating Activities                     467,200             443,054
                                                    -----------------    -----------------
INVESTING ACTIVITIES
Capital expenditures                                         (403,611)           (512,991)
Investments                                                  (175,977)                  -
Other                                                           7,599              10,749
                                                    -----------------    ----------------
Net Cash (Used in) Investing Activities                      (571,989)           (502,242)
                                                    -----------------    ----------------
FINANCING ACTIVITIES
Treasury stock issued (purchased)                              20,951            (289,172)
Issuance of commercial paper, net                             173,790             103,950
Issuance of long-term debt                                    463,627              40,523
Payment of long-term debt                                     (37,000)           (397,000)
Payment of preferred stock                                   (363,000)                  -
Preferred stock dividends paid                                (18,600)            (26,067)
Common stock dividends paid                                  (179,049)           (185,375)
Other                                                         (20,914)               (548)
                                                    -----------------    ----------------
Net Cash Provided by (Used in) Financing
    Activities                                                 39,805            (753,689)
                                                    -----------------    ----------------
Net (Decrease) in Cash and
     Temporary Cash Investments                      $        (64,984)           (812,877)
                                                    =================   =================
Cash and temporary cash investments at
    beginning of period                                       128,602 $           942,776
Net (Decrease) in cash and
     temporary cash investments                               (64,984)           (812,877)
                                                    ----------------    -----------------
Cash and Temporary Cash Investments at
    End of Period                                              63,618 $           129,899
                                                    =================   =================
</TABLE>
Temporary cash investments are short-term  marketable  securities purchased with
maturities of three months or less that were carried at cost which  approximates
fair value.
                See accompanying Notes to the Consolidated Financial Statements.




                                        6

<PAGE>



                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     KeySpan Corporation  (referred to in the notes to the Financial  Statements
     as "we", "us", and "our") is a holding company operating two utilities that
     distribute  natural gas to approximately  1.6 million customers in New York
     City and on Long  Island,  making it the fourth  largest  gas  distribution
     company in the United States.  We are also a major, and growing,  generator
     of  electricity.  We own and operate  five large  generating  plants and 42
     smaller  facilities in Nassau and Suffolk Counties on Long Island and lease
     and  operate a major  facility  in Queens  County in New York  City.  Under
     contractual  arrangements,  we provide  power,  electric  transmission-and-
     distribution   services,   billing   and  other   customer   services   for
     approximately  one million  electric  customers  of the Long  Island  Power
     Authority.  Our other  subsidiaries are involved in oil and gas exploration
     and  production;  gas  storage;  wholesale  and  retail  gas  and  electric
     marketing;  appliance  service;  heating,  ventilation and air conditioning
     installation and services; large energy-system ownership,  installation and
     management;  telecommunications; and energy-related internet activities. We
     also invest in, and participate in the development of,  pipelines and other
     energy-related projects, domestically and internationally.


1.  BASIS OF PRESENTATION

     In  our  opinion,  the  accompanying   unaudited   Consolidated   Financial
     Statements  contain  all  adjustments   necessary  to  present  fairly  our
     financial  position  as of  September  30,  2000,  and the  results  of our
     operations  for the three and nine  months  ended  September  30,  2000 and
     September  30, 1999 and cash flows for the nine months ended  September 30,
     2000 and September 30, 1999. The accompanying  financial  statements should
     be read in conjunction with the consolidated financial statements and notes
     included  in our 1999  Annual  Report on Form  10-K.  Income  from  interim
     periods may not be indicative of future results. Certain  reclassifications
     were made to conform  prior period  financial  statements  with the current
     period financial statement presentation.  Other than as noted,  adjustments
     were of a normal, recurring nature.


2.  BUSINESS SEGMENTS

    We have six reportable segments:  Gas Distribution,  Electric Services, Gas
    Exploration and Production, Energy Services, Energy Investments and Other.

    The  Gas   Distribution   segment  consists  of  our  two  gas  distribution
    subsidiaries.  The Brooklyn Union Gas Company d/b/a KeySpan Energy  Delivery
    New York  provides  gas  distribution  services to customers in the New York
    City  Boroughs  of  Brooklyn,  Queens and Staten  Island.  KeySpan  Gas East
    Corporation   d/b/a  KeySpan  Energy   Delivery  Long  Island  provides  gas
    distribution services to customers in the Long Island counties of Nassau and
    Suffolk and the Rockaway Peninsula of the Borough of Queens.

    The Electric  Services  segment  consists of  subsidiaries  that operate the
    electric transmission and distribution system owned by the Long Island Power
    Authority; own and provide capacity to and



                                        7

<PAGE>



    produce  energy for the Long  Island  Power  Authority  from our  generating
    facilities  located on Long  Island;  and manage fuel  supplies for the Long
    Island Power Authority to fuel our Long Island  generating  facilities,  all
    through  long-term  service  contracts having terms that range from eight to
    fifteen years. The Electric Services segment also includes subsidiaries that
    own, lease and operate the 2,168  megawatt  Ravenswood  electric  generation
    facility, located in Queens, New York. Our contract with Consolidated Edison
    Company of New York,  which  provided  Consolidated  Edison with 100% of the
    available  capacity  of the  Ravenswood  facility  on a fixed  monthly  fee,
    expired on April 30,  2000.  We now provide all of the energy,  capacity and
    ancillary  services  related  to the  Ravenswood  facility  to the New  York
    Independent  System Operator.  Currently,  our primary  electric  generation
    customers are the Long Island Power  Authority and the New York  Independent
    System Operator energy markets.

    The  Gas  Exploration  and  Production  segment  is  engaged  in gas and oil
    exploration and production,  and the development and acquisition of domestic
    natural  gas and oil  properties.  This  segment  consists of our 70% equity
    interest in The Houston Exploration  Company, an independent natural gas and
    oil exploration company, as well as KeySpan Exploration and Production, LLC,
    our  wholly  owned  subsidiary  engaged  in a  joint  venture  with  Houston
    Exploration.  On March 31, 2000,  under a pre-existing  credit  arrangement,
    approximately  $80  million  in debt owed by Houston  Exploration  to us was
    converted into common equity of Houston  Exploration.  Upon such conversion,
    our common equity ownership interest in Houston  Exploration  increased from
    64% to the current level of approximately 70%.

     The Energy  Services  segment  primarily  includes  companies  that provide
     energy related services to customers  located within the New York tri-state
     metropolitan area, Rhode Island and Pennsylvania through the following four
     lines of business:  (i) Home Energy Services provides residential customers
     with service and maintenance of energy systems and  appliances,  as well as
     the retail  marketing of natural gas and  electricity  to  residential  and
     small commercial  customers;  (ii) Business Solutions provides professional
     engineering-consulting  and design of energy  systems  for  commercial  and
     industrial  customers,   including   installation  of  plumbing,   heating,
     ventilation and air  conditioning  equipment;  (iii) Commodity  Procurement
     provides management and procurement services for fuel supply and management
     of energy sales,  primarily for and from the Ravenswood facility;  and (iv)
     Telecommunications  Services provides various services to carriers of voice
     and data transmission on Long Island and in New York City.

    Subsidiaries in the Energy Investments segment hold a 20% equity interest in
    the Iroquois Gas Transmission System LP, a pipeline that transports Canadian
    gas supply to markets in the  Northeastern  United States; a 50% interest in
    the Premier  Transmission  Pipeline and a 24.5% interest in Phoenix  Natural
    Gas, both in Northern Ireland;  investments in certain midstream natural gas
    assets in Western Canada owned jointly with Gulf Canada  Resources  Limited,
    through the Gulf Midstream Services Partnership and the ownership of certain
    oil  producing  properties  in  Alberta,   Canada.  These  subsidiaries  are
    primarily accounted for under the equity method. Accordingly,  equity income
    from these  investments is reflected in other income and (deductions) in the
    Consolidated  Statement of Income.  In October 2000, we sold our interest in
    certain oil producing  properties in Alberta,  Canada.  An after-tax gain of
    approximately  $1.3  million  from the sale will be  reported  in the fourth
    quarter of 2000.  Further,  also in October  2000, we acquired the remaining
    50% interest in Gulf Midstream,  making us the sole owner of Gulf Midstream.
    The



                                        8

<PAGE>



    transaction  required us to borrow an additional $48 million from a Canadian
    bank.  For future  financial  reporting  purposes,  the  operations  of Gulf
    Midstream,  which will now be known as KeySpan Energy Canada,  will be fully
    consolidated in our financial statements.

    The  Other  segment  represents  primarily  unallocated  administrative  and
    general expenses, interest income earned on temporary cash investments,  and
    preferred stock dividends.

    The  accounting  policies of the segments are the same as those used for the
    preparation  of the  Consolidated  Financial  Statements.  Our  segments are
    strategic  business  units  that are  managed  separately  because  of their
    different operating and regulatory environments.  At September 30, 2000, the
    total assets of certain  reportable  segments increased from levels reported
    at December  31,  1999 as  follows:  the Energy  Services  segment's  assets
    increased by approximately  $260 million due primarily to the acquisition of
    four  additional  companies  that  provide  energy-related  services and the
    investment in MyHomeKey.com,  Inc. The segment  information  presented below
    reflects amounts reported in the Consolidated  Financial  Statements for the
    three and nine months ended September 30, 2000 and 1999.

<TABLE>
<CAPTION>
                                                                                                       (IN THOUSANDS OF DOLLARS)
-----------------------------------------------------------------------------------------------------------------------------------
                            Gas         Electric    Gas Exploration    Energy      Energy
                        Distribution    Services    and Production     Services    Investments   Other   Eliminations   Consolidated
------------------------------------- ------------- ----------------- ----------- ------------- -------  -------------   ----------
<S>                     <C>           <C>               <C>           <C>            <C>          <C>        <C>           <C>
THREE MONTHS ENDED
SEPTEMBER 30, 2000

Unaffiliated Revenue   $ 292,352 $     374,517 $          62,748 $      215,871 $     1,649       $ -         $    -      $ 947,137
Intersegment Revenue                                                     15,903                              (15,903)             -
Operating Income        (21,542)        73,007            30,985         19,653       (969)       (9,056)          -         92,078
Earnings for
  Common Stock          (28,033)        31,796            13,418          9,636       2,687       (16,350)         -         13,154
Basic and Diluted
  Earnings Per Share    $(0.21)         $0.24             $0.10           $0.07        $0.02      $(0.12)         $-          $0.10

THREE MONTHS ENDED
SEPTEMBER 30, 1999

Unaffiliated Revenue   $ 208,572 $     241,259 $          42,081 $      46,096  $       461     $    -        $    -      $ 538,469
Intersegment Revenue           -             -                 -              -           -          -             -              -
Operating Income        (28,635)        49,392            15,798              -     (1,234)       1,462            -         36,783
Earnings for
  Common Stock          (29,037)        28,164             5,435            116       2,821       (7,171)          -            328
Basic and Diluted
  Earnings Per Share    $(0.21)         $0.21              $0.04           $0.00       $0.02     $ (0.06)      $     -        $0.00
---------------------    ----------- -------------  ----------------- -------------- ------------- ----------- -------------  ------
</TABLE>








                                        9

<PAGE>




<TABLE>
<CAPTION>


                                                                                                       (IN THOUSANDS OF DOLLARS)
-----------------------------------------------------------------------------------------------------------------------------------
                             Gas         Electric     Gas Exploration    Energy       Energy
                         Distribution    Services     and Production     Services    Investments  Other  Eliminations   Consolidated
----------------------- -------------- ------------- ----------------- -----------   ----------- ------   -----------   -----------
<S>                      <C>            <C>                <C>             <C>       <C>            <C>       <C>          <C>
NINE MONTHS ENDED
SEPTEMBER 30, 2000

Unaffiliated Revenue    $ 1,458,595 $   1,097,616 $         169,966 $      480,511 $    4,650      $ -      $    -    $    3,211,338
Intersegment Revenue           -             -               -              48,677       -           -       (48,677)              -
Operating Income            212,688       204,834            72,514         51,958    (4,022)     (15,864)       -           522,108
Earnings for
  Common Stock              101,025       103,316            29,381         25,221      7,877     (43,033)       -           223,787
Basic and Diluted
  Earnings Per Share         $0.75          $0.77             $0.22          $0.19      $0.06      $(0.32)     $ -             $1.67

NINE MONTHS ENDED
SEPTEMBER 30, 1999

Unaffiliated Revenue    $ 1,208,254 $     606,552 $         103,622 $     123,165  $   1,510       $  -     $   -     $    2,043,103
Intersegment Revenue              -             -                 -              -          -         -         -                  -
Operating Income            198,565       112,652            29,879        (4,491)    (3,949)      7,564        -            340,220
Earnings for
  Common Stock               92,873        59,786             9,239        (2,384)      5,937     (16,292)      -            149,159
Basic and Diluted
  Earnings Per Share        $0.66          $0.43              $0.07        $(0.02)      $0.04     $(0.12)     $ -              $1.06
------------------------- -------------- -------------  --------------  -----------   --------  ---------  ------------- -----------

</TABLE>
3.  ENVIRONMENTAL MATTERS

    MANUFACTURED  GAS PLANT SITES: We have identified  thirty-four  manufactured
    gas plant sites that were  historically  owned or operated by KeySpan Energy
    Delivery  New  York  and  KeySpan  Energy  Delivery  Long  Island  (or  such
    companies'  predecessors).  These former sites,  some of which are no longer
    owned by us,  have  been  identified  to the New York  State  Department  of
    Environmental   Conservation   for  inclusion  on  appropriate   waste  site
    inventories.

    We  presently  estimate  that the  remaining  cost of our  manufactured  gas
    plant-related  environmental  cleanup  activities will be approximately $119
    million;  which amount has been accrued as our current best  estimate of our
    aggregate  environmental  liability  for known  sites.  The  currently-known
    conditions  of the former  manufactured  gas plant  sites,  their period and
    magnitude of operation, generally observed cleanup requirements and costs in
    the industry,  current land use and ownership,  and possible reuse have been
    considered  in  establishing  contingency  reserves.  We believe that in the
    aggregate,  the accrued  liability for  investigation and remediation of the
    manufactured gas plant sites  identified  above are reasonable  estimates of
    likely cost within a range of reasonable, foreseeable costs.

    Thirteen of the identified sites are currently the subject of Administrative
    Consent Orders with the Department of Environmental Conservation and another
    site is subject to the negotiation of an Administrative  Consent Order or an
    agreement  under the Department of  Environmental  Conservation's  Voluntary
    Clean-up Program. Our remaining manufactured gas plant sites may



                                       10

<PAGE>



    not become  subject to  Administrative  Consent  Orders in the  future,  and
    accordingly no liability has been accrued for these sites.

    Under prior rate orders,  the Public Service  Commission of the State of New
    York has  allowed  recovery  of costs  related  to  certain  KeySpan  Energy
    Delivery New York manufactured gas plant sites. We believe that current rate
    plans in effect for both Gas Distribution  subsidiaries provide for recovery
    of  environmental  costs  attributable to the Gas Distribution  segment.  At
    September 30, 2000, we had a total  regulatory  asset of  approximately  $98
    million.  Expenditures  incurred to date by us with respect to  manufactured
    gas plant-related activities total approximately $20 million.


4.  LIQUIDITY AND FINANCINGS

    During the nine months ended  September 30, 2000, we issued $1.6 billion and
    repaid $1.4 billion of commercial paper to satisfy working capital needs and
    the mandatory redemption of preferred stock as discussed below. At September
    30,  2000,  we had $382.1  million of  commercial  paper  outstanding  at an
    average annualized interest rate of 6.73%.

    Houston  Exploration  also  issued  and repaid  commercial  paper to satisfy
    working  capital needs during the nine months ended  September 30, 2000. For
    the nine months ended September 30, 2000, Houston  Exploration  borrowed $30
    million  under its credit  facility  with a  commercial  bank and repaid $37
    million of  outstanding  borrowings.  At September  30,  2000,  $174 million
    remained  outstanding  under this facility at a weighted average  annualized
    interest rate of 7.84%. In addition,  during the nine months ended September
    30, 2000, a  subsidiary  in the Energy  Investments  segment  increased  its
    borrowings under a revolving loan agreement with a financial  institution in
    Canada by $33.6 million. At September 30, 2000, $118 million was outstanding
    at a weighted average annualized interest rate of 6.48%.

     In August, we filed a shelf registration  statement with the Securities and
     Exchange  Commission  for  the  issuance  of up to  $1.65  billion  of debt
     securities.  We intend to issue the debt  securities  to replace short term
     borrowings to be entered into in connection with our acquisition of Eastern
     Enterprises  and  EnergyNorth,  Inc.  (See note 5  Acquisition  of  Eastern
     Enterprises.)

    On June 1, 2000, we redeemed, at maturity, all 14,520,000 outstanding shares
    of our 7.95%  Preferred  Stock Series AA. Our  obligation of $370.2  million
    included the mandatory  redemption  price of $25 per share  totaling  $363.0
    million and dividends  payable  totaling $7.2 million.  The  redemption  was
    satisfied  through  utilization of internally  generated  funds and proceeds
    from the issuance of commercial paper.

    KeySpan  Energy  Delivery Long Island filed a shelf  registration  statement
    with  the  Securities  and  Exchange  Commission  in  December  1999 for the
    issuance of up to $600  million of medium  term notes.  On February 1, 2000,
    KeySpan  Energy  Delivery Long Island  issued $400 million  7.875% Notes due
    February 1, 2010.  The net proceeds from the issuance were used to repay our
    treasury for costs in extinguishing  $397 million of promissory notes to the
    Long Island Power Authority



                                       11

<PAGE>



    that   matured  in  June  1999.   The  medium   term  notes  are  fully  and
    unconditionally  guaranteed  by us.  Currently,$200  million of medium  term
    notes remain available for issuance under this shelf registration statement.


5.  ACQUISITION OF EASTERN ENTERPRISES

    On November 4, 1999, we and Eastern Enterprises announced that the companies
    had signed a definitive  merger agreement under which we will acquire all of
    the  common  stock of  Eastern  for  $64.00  per share in cash,  subject  to
    adjustment.  The  Agreement  and Plan of Merger is included as an exhibit to
    our Form 10K for the year ended  December 31, 1999.  The  transaction  has a
    total  value  of  approximately  $2.5  billion  and  will be  accounted  for
    utilizing purchase accounting.

    In connection with the merger, Eastern has amended its merger agreement with
    EnergyNorth,  Inc.  to  provide  for an all cash  acquisition  by Eastern of
    EnergyNorth  shares at a price per share of $61.13,  subject to  adjustment.
    The restructured  EnergyNorth merger is expected to close  contemporaneously
    with the  KeySpan/Eastern  transaction.  The  EnergyNorth  transaction has a
    total value of approximately $250 million.

    We intend to access the financial  markets in the fourth  quarter of 2000 to
    finance   approximately   $2  billion  for  the   Eastern  and   EnergyNorth
    transactions.  We intend to use bridge financing to fund these  transactions
    initially and then replace the bridge  financing with $1.65 billion of long-
    term  debt  securities  as soon as  practicable  thereafter.  The  remaining
    balance  will be financed  through  the  issuance of  commercial  paper.  We
    anticipate issuing several different maturities of long-term debt to balance
    our future debt capital maturity structure.

    We expect pre-tax annual cost savings  resulting from the transactions to be
    approximately  $40 million.  These cost savings  result  primarily  from the
    elimination  of duplicate  corporate and  administrative  programs,  greater
    efficiencies in operations and business processes,  and increased purchasing
    efficiencies.  We expect to achieve the majority of the reductions through a
    variety of programs  which  would  include  hiring  freezes,  attrition  and
    separation programs, including implementation of an early retirement program
    and targeted  severance  programs.  We have begun to initiate  some of these
    programs  and will  report  the  potential  effect of these  initiatives  on
    earnings and cash flow from operations when job positions and cost estimates
    have been finalized.

    Following the closing of these  transactions,  we will become subject to the
    regulation of the Securities and Exchange Commission as a registered holding
    company under the Public Utility Holding Company Act of 1935, as amended. As
    such,  our corporate and financial  activities as well as our  subsidiaries,
    including  such  entities'  ability  to pay  dividends,  will be  subject to
    Securities  and Exchange  Commission  regulation.  The merger is conditioned
    upon the approval of the Securities and Exchange Commission. Shareholders of
    both Eastern and  EnergyNorth,  as well as the New Hampshire  Public Utility
    Commission  (with  respect to Eastern's  acquisition  of  EnergyNorth)  have
    approved the transactions. We anticipate that the transaction will be



                                       12

<PAGE>



    consummated  in the fourth quarter of 2000, but are unable to determine when
    or if the required  Securities  and  Exchange  Commission  approval  will be
    obtained.


6.  NEW YORK STATE INDEPENDENT SYSTEM OPERATOR MATTERS

    We currently realize revenues from our investment in the Ravenswood facility
    through the  wholesale  sale of energy,  capacity  and  ancillary  services.
    Ancillary  services  include  spinning  reserves and non-spinning  reserves
    available  to  replace  energy  that is  unable to be  delivered  due to the
    unexpected loss of a major energy source.

    Due  to  the  increase  in  the   market-clearing   price  of  spinning  and
    non-spinning  reserves  during  the  first  quarter  of  2000,  the New York
    Independent  System  Operator  requested that the Federal Energy  Regulatory
    Commission approve a bid cap on reserves as well as requiring a refunding of
    so-called alleged "excess  payments"  received by sellers into the ancillary
    services market, including the Ravenswood facility and the Long Island Power
    Authority.  Other  market  participants,  including  buyers of reserves  and
    electric  utilities as load serving  entities also filed complaints with the
    Federal Energy  Regulatory  Commission and intervened in the various Federal
    Energy Regulatory Commission  proceedings related to reserves,  and proposed
    alternative remedies.

     On May 31, 2000, the Federal Energy  Regulatory  Commission issued an order
     on reserves that granted  approval of a bid cap for  non-spinning  reserves
     which  includes  payments  for the  opportunity  cost of not making  energy
     sales.  The  other  requests  - such as a bid cap  for  spinning  reserves,
     retroactive  refunds,  recalculation  of reserve prices for March 2000, and
     convening a technical conference and settlement proceeding - were rejected.
     Pursuant  to the May  31,  2000  order,  the New  York  Independent  System
     Operator made its first compliance  filing to the Federal Energy Regulatory
     Commission  on June 15,  2000.  However,  the New York  Independent  System
     Operator and several other market  participants have requested rehearing of
     the May 31, 2000 order.  In  response  to the New York  Independent  System
     Operator request, the Federal Energy Regulatory  Commission has allowed the
     New York Independent System Operator to recalculate prices for reserves for
     the March 2000 period as if the bid cap  approved  effective  April 1, 2000
     had been effective for March,  pending its review on the rehearing requests
     of the May 31, 2000 order.

    On September 5, 2000 New York State  Electric  and Gas  Corporation  filed a
    lawsuit against the New York Independent  System Operator,  in Supreme Court
    Broome County,  seeking  recovery of overcharges  and damages related to the
    New  York  Independent  System  Operator's  administration  of the  reserves
    market. We are not a party to the lawsuit.

    Additionally,  the  wholesale  energy  market  has also  been  the  focus of
    increased  market based pricing.  On June 30, 2000, the New York Independent
    System  Operator  petitioned  the Federal  Energy  Regulatory  Commission to
    approve a $1,300  megawatt/hour  ("MWh") bid cap in the energy  market to be
    effective July 6, 2000 through  October 28, 2000.  The New York  Independent
    System  Operator  requested the bid cap because it believed that there was a
    lack of price responsive  demand and that the start-up  problems  associated
    with implementation of the New



                                       13

<PAGE>



    York Independent  System Operator might cause severe price spikes during the
    summer peak  months.  In  response,  on July 26,  2000,  the Federal  Energy
    Regulatory  Commission issued an order approving a $1,000/MWh bid cap in the
    energy market effective July 26, 2000 through October 28, 2000. The July 26,
    2000  order  also  required  the New York  Independent  System  Operator  to
    identify  certain  "market flaw  problems" and to report them to the Federal
    Energy Regulatory Commission by September 1, 2000.

    On September 8, 2000 the New York Independent  System Operator issued to the
    Federal Energy Regulatory  Commission  revised tariff sheets and a corrected
    combined  compliance  filing and report  related  to  reserve  markets.  The
    compliance  filing proposes tariff changes to become  effective  November 1,
    2000  with the  exception  of the  effective  date for the  payment  of lost
    opportunity  costs to  suppliers of  10-minute  reserves,  where such filing
    proposes an effective date of May 31, 2000. The compliance filing proposed a
    number of  changes,  including  the  gradual  removal  of the bid cap in the
    reserve market from $15.00/MWh on November 1, 2000, to $30.00/MWh on January
    1, 2001 and to eliminate it completely on May 1, 2001. Various parties filed
    comments to the compliance  filing requesting  additional  changes including
    extending  the  $1,000/MWh  energy price cap beyond  October 28,  2000.  The
    compliance  filing and  comments are pending the Federal  Energy  Regulatory
    Commission review.

    We are opposing  the relief  requested  by the New York  Independent  System
    Operator  and the load  serving  entities  and  believe  that  the  ultimate
    resolution  of  these  issues  will  not  have  a  material  effect  on  our
    consolidated financial position or results of operations.


7.  DERIVATIVE FINANCIAL INSTRUMENTS

     In  connection  with our  anticipated  purchase  of  Eastern  (See  Note 5,
     "Acquisition  of Eastern  Enterprises")  and the  anticipated  issuance  of
     long-term  debt  securities  to finance the  acquisition,  we entered  into
     forward  starting  swap  agreements to hedge a portion of the risk that the
     cost of the future issuance of fixed-rate debt may be adversely affected by
     changes in interest rates. Through September 30, 2000, we have entered into
     $1.5 billion of forward starting swap  agreements.  The interest lock rates
     range  from  6.86% to 7.78% and have  maturities  that  range  from 5 to 30
     years. Under a forward starting swap agreement,  we agree to pay or receive
     an amount equal to the difference between the net present value of the cash
     flows for a notional amount of indebtedness  based on the existing yield of
     a  hedging  instrument  at the  date of the  agreement  and at the date the
     agreement is settled. Gains and losses on these agreements will be deferred
     and  amortized  over  the life of the  underlying  debt to be  issued.  The
     notional amounts of the agreements are not exchanged.  We have entered into
     these agreements with more than one major financial institution in order to
     minimize counter party credit risk.



                                       14

<PAGE>



     Based on interest rates  effective as of October 30, 2000, we estimate that
     we may be obligated to pay counterparties  approximately $60 million at the
     time of the issuance of the long-term  debt.  This amount will be amortized
     over the life of the long-term  debt, with maturities that are estimated to
     range from 5 to 30 years. This amount reflects the significant  decrease in
     interest  rates  since we  entered  into the  forward  starting  swap  lock
     agreements.  As a result of the significant  decrease in interest rates, we
     will be able to issue the anticipated long-term debt at lower rates.

    Also  during the  quarter,  we have  engaged in the use of  derivative  swap
    instruments  to fix the  selling  price on a portion of our  estimated  2001
    summer peak electric  energy sales from the  Ravenswood  facility and to fix
    the purchase price of fuel used to generate  electricity.  For the months of
    July and August  2001,  we have hedged the sales  price on 105,600  megawatt
    hours  of  summer  peak  electric  sales  to  protect  against  a  potential
    degradation in market prices during the summer. Under these swap agreements,
    we will receive a fixed price per megawatt hour of  electricity  sold during
    summer peak hours and pay the counter party the then current floating market
    price for peak electric  supply.  We will receive the then current  floating
    market price of peak  electric  energy when the  Ravenswood  facility  sells
    electric  energy  to  the  New  York  Independent  System  Operator.   These
    derivatives are accounted for as hedges. We also have a tolling  arrangement
    with two counter parties under which we have  "locked-in" a profit margin on
    52,800  megawatt hours of summer season sales and 211,200  megawatt hours of
    winter sales. Under these arrangements,  we will receive an up-front fee and
    will pay the counter party,  on a monthly basis,  our realized profit margin
    from the sale of electric energy. As a result of these hedging arrangements,
    we have hedged  approximately  9% of our estimated peak 2001 summer electric
    sales and approximately 6% of our estimated 2001 yearly electric sales.

8.    NEW FINANCIAL ACCOUNTING STANDARDS

     In June 1999, the Financial  Accounting  Standards  Board  ("FASB")  issued
     Statement of Financial  Accounting  Standard ("SFAS") No. 137,  "Accounting
     for  Derivative  Instruments  and  Hedging  Activities  -  Deferral  of the
     Effective  Date of SFAS No. 133." SFAS No. 137 defers the effective date of
     SFAS No.  133 to  fiscal  years  beginning  after  July 15,  2000.  We will
     therefore adopt SFAS No. 133 in the first quarter of fiscal year 2001. SFAS
     No. 133  establishes  accounting  and reporting  standards  for  derivative
     instruments and for hedging activities.

    In June  2000,  the  FASB  issued  SFAS No.  138,  "Accounting  for  Certain
    Derivative Instruments and Certain Hedging Activities - An Amendment of FASB
    Statement  No  133."  SFAS No.  138  amends  the  accounting  and  reporting
    standards of SFAS No. 133 for a number of transactions. The most significant
    amendment  to SFAS 133 as it  relates to our  operations  is that the normal
    purchases and normal sales exception found in SFAS 133 may now be applied to
    contracts that implicitly or explicitly permit net settlement, and contracts
    that have a market mechanism to facilitate net settlement.  Therefore, under
    SFAS  138 our  gas  procurement  contracts  are  not  considered  derivative
    financial instruments.

    All of our  derivative  financial  instruments,  except for an interest rate
    swap, are cash-flow  hedges.  SFAS No. 133 requires that an entity recognize
    all  derivatives  as  either  assets  or  liabilities  in the  statement  of
    financial  position and measure those  instruments  at fair value.  Periodic
    changes  in market  value of  derivatives  which  meet the  definition  of a
    cash-flow   hedge  are  recorded  as   comprehensive   income,   subject  to
    effectiveness,  and then  included  in net  income to match  the  underlying
    hedged transactions.  Our derivative  instruments currently in place qualify
    for hedge



                                       15

<PAGE>



     accounting, and as a result implementation of SFAS No. 133 and SFAS No. 138
     when adopted are not expected to have a material  effect on our net income,
     but could have a  significant  effect on  comprehensive  income  because of
     fluctuations  in the market value of the  derivatives  employed for hedging
     certain risks.

9.         KEYSPAN GAS EAST CORPORATION SUMMARY FINANCIAL DATA

      KeySpan Gas East Corporation d/b/a/ KeySpan Energy Delivery Long Island is
      a wholly owned subsidiary of KeySpan Corporation.  KeySpan Energy Delivery
      Long Island was formed on May 7, 1998 and on May 28, 1998  acquired all of
      the assets  related to the gas  distribution  business  of the Long Island
      Lighting  Company  ("LILCO").  KeySpan  Energy  Delivery  Long  Island has
      established a program for the  issuance,  from time to time, of up to $600
      million  aggregate  principal amount of Medium-Term  Notes,  which will be
      fully and unconditionally  guaranteed by KeySpan Corporation.  (See Note 4
      "Issuance of Long-Term Debt,  Repayment of Notes Payable and  Financing.")
      On February  1, 2000,  KeySpan  Energy  Delivery  Long Island  issued $400
      million of 7.875% Medium Term Notes due 2010.

      The following represents  summarized balance sheet data for KeySpan Energy
Delivery Long Island.
                                                       (IN THOUSANDS OF DOLLARS)
------------------------------------------ -------------------------------------
                                        September 30, 2000     December 31, 1999
------------------------------------------ -------------------------------------
Current assets                             $   294,141              $    358,415
Noncurrent assets                            1,394,346                 1,327,692
Current liabilities                            126,383                   548,331
Noncurrent liabilities
           including long-term debt            885,771                   484,702
Net assets (1)                             $   676,333              $    653,074
------------------------------------------ -------------------------------------

(1) Net Assets  reflect  total assets less current and  noncurrent  liabilities.
Intercompany  accounts  receivable  are included in current assets and long-term
intercompany accounts payable are included in noncurrent liabilities.




Certain common assets which were previously part of LILCO's  operations prior to
May 28, 1998 have been transferred to other subsidiaries of KeySpan  Corporation
(e.g.  common  plant,  inventory,  etc.).  Since May 28,  1998,  KeySpan  Energy
Delivery  Long Island has been charged by  affiliated  companies  for the use of
these assets, resulting in an operating expense of $2.6 million and $8.2 million
for the three and nine months ended September 30, 2000, respectively.

      The following  represents  summarized  income  statement  data for KeySpan
Energy Delivery Long Island.
<TABLE>
<CAPTION>

                                                                                               (IN THOUSANDS OF DOLLARS)
------------------------------- ---------------------- -------------------- --------------------- ----------------------


                                 Three Months Ended    Three Months Ended    Nine Months Ended      Nine Months Ended
                                 September 30, 2000    September 30, 1999    September 30, 2000    September 30, 1999
------------------------------- ---------------------- -------------------- --------------------- ----------------------
<S>                             <C>                    <C>                  <C>                   <C>
Revenues                        $95,229                $72,956              $512,470              $441,228

Operating Income (1)            $(6,847)               $(12,594)            $70,680               $76,241

Net Income (Loss)               $(12,995)              $(15,163)            $23,260               $25,578
------------------------------- ---------------------- -------------------- --------------------- ----------------------
</TABLE>

(1)  Operating  income is defined  as  revenues  less cost of gas and  operating
expenses.  Operating  expenses  include the following  expenses:  operations and
maintenance, depreciation and amortization and operating taxes.

                                       16

<PAGE>


                      KEYSPAN CORPORATION AND SUBSIDIARIES
                                    SIGNATURE

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant has duly caused this report to be signed on behalf of the undersigned
there unto duly authorized.

                               KEYSPAN CORPORATION
                                  (Registrant)







Date: January 10, 2001                         /s/ Gerald Luterman
                                               ---------------------------------
                                                   Gerald Luterman
                                                   Senior Vice President and
                                                   Chief Financial Officer


Date: January 10, 2001                         /s/ Ronald S. Jendras
                                               --------------------------------
                                                   Ronald S. Jendras
                                                   Vice President, Controller
                                                   and Chief Accounting Officer





                                       17