THE
               OREGON ELECTRIC CONSTRUCTION, INC.
                   DEFERRED COMPENSATION PLAN

















                  Effective September 14, 2001


               OREGON ELECTRIC CONSTRUCTION, INC.
                   DEFERRED COMPENSATION PLAN

     This is the Oregon Electric Construction, Inc. Deferred
Compensation Plan (the "Plan"), and is adopted by OREGON ELECTRIC
CONSTRUCTION, INC., an Oregon corporation (the "Company"), for
the purpose of providing an inducement for continued service by
designated key employees of the Company following the purchase of
all of the capital stock of the Company by UTILITY SERVICES,
INC., a Delaware corporation (the "Purchase").  Benefits due
under the Plan constitute a mere promise by the Company to pay
benefits as the Plan provides.  Participants are general
unsecured creditors of the Company with respect to their
benefits, and the Plan is unfunded for tax purposes.  Because the
Plan does not systematically delay the payment of benefits until
retirement or termination of employment, it is not a pension
benefit plan subject to the Employee Retirement Income Security
Act of 1974, as amended.  This document contemplates the
establishment of a trust after the Purchase for the purpose of
holding MDU Shares under this Plan, subject to the claims of the
general creditors of the Company and MDU.

                            ARTICLE I
                 ADOPTION OF PLAN; PARTICIPATION

     The Plan is adopted effective this 14th day of September,
2001; provided, however, that the Plan shall automatically
terminate (and any Account balances shall be forfeited entirely)
on the 30th day thereafter if the Purchase has not then occurred.
Each individual listed on Schedule A shall be a Participant,
provided that such individual is an employee of the Company in
good standing on the Purchase Date.

                           ARTICLE II
                     VESTING AND FORFEITURES

     2.1  Vesting.  Except as provided otherwise in this section,
a Participant shall vest in his or her Account on the Vesting
Date if the Participant does not incur a Termination before the
Vesting Date.  A Participant who, before the Vesting Date, incurs
a Termination shall forfeit the balance in his or her Account
effective on the date of the Termination; provided, however, that
the Account shall not be forfeited if the Termination (i) results
from the Participant's death or total disability before the
Vesting Date or (ii) is involuntary and is not a Termination for
Cause.  A reduction in base salary, and a substantial reduction
in duties or responsibilities, shall each constitute sufficient
reason for the Participant's Termination to be deemed
involuntary, provided the Company has had sufficient notice and
opportunity to correct such a change in the terms of the
Participant's employment.

     2.2  Disposition of Forfeited Shares.  If the MDU Shares
credited to any Account are forfeited pursuant to Section 2.1,
the Company shall notify the Trustee of the forfeiture, and the
Trustee shall forthwith deliver the forfeited shares to MDU's
Secretary.

                           ARTICLE III
                 CREDITS AND CHARGES TO ACCOUNTS

     3.1  Account.  An Account shall be established and
maintained for each Participant, which Account shall be credited
with the dollar amounts set forth opposite the Participant's name
on Schedule A.  On the Purchase Date, the dollar amount credited
to each Participant's Account shall be converted into a number of
whole MDU Shares equal to the quotient of such dollar amount
divided by the MDU Stock Price (as defined in the Stock Purchase
Agreement dated as of September 14, 2001, pursuant to which the
Purchase was consummated), such number rounded up or down in an
appropriate manner determined by the Administrator.  Following
such conversion, and subject to all of the terms and conditions
of this Plan, each Participant shall be entitled to receive the
MDU Shares credited to his Account rather than the dollar amount
set forth in Schedule A.  Each Account shall be charged with
distributions, income taxes and any other amounts required to be
withheld under Section 4.6.

     3.2  Earnings.  Earnings to be credited to an Account shall
be equal to the dividends declared and paid from time to time
with respect to the number of MDU Shares then credited to the
Account.

                           ARTICLE IV
                          DISTRIBUTIONS

     4.1  No Withdrawals.  Except as otherwise provided in this
article, withdrawals are not available from an Account.

     4.2  Timing of Distribution.  Earnings credited to a
Participant's Account shall be distributed forthwith to the
Participant, subject to tax withholding pursuant to Section 4.6.
The MDU Shares credited to a Participant's Account shall be paid
on the Vesting Date if the Participant has not incurred a
Termination before the Vesting Date as described in Section 2.1.

     4.3  Death or Disability.  Should a Participant die or
become totally disabled before incurring a Termination, the
Participant's Account shall vest in full and be paid to his or
her Beneficiary under Article V (or to the Participant, in the
case of disability) as soon as is practicable.

     4.4  Limitation on Distributions to Covered Employees.
Notwithstanding any other provision of this article, if a
Participant is a "covered employee" as defined in Code Section
162(m)(3) at the time of any distribution, the maximum amount
which may be distributed from such a Participant's Account in any
Plan Year shall not exceed $1,000,000, less the amount of
compensation paid to the Participant by the Company in such Plan
Year which is not "performance-based" (as defined in Code Section
162(m)(4)(C)).  Such amount shall be reasonably determined by the
Administrator at the time of the proposed distribution.  Any
amount not distributed to a Participant in a Plan Year as a
result of the limitation set forth in this section shall be
distributed in the next Plan Year, which may again be subject to
the limitation of this section.

     4.5  Payments to Minors and Incompetents.  If any person
entitled to any payment under this Plan is, in the judgment of
the Administrator, incapable of giving receipt for such payment
because of minority, illness, infirmity or other incapacity, the
Administrator may pay the amount due such person to a duly
appointed legal representative, if there is one, or, if none, to
the spouse, children, dependents, or such other persons with whom
the person entitled to payment resides.  Any such payment shall
be a complete discharge of the liability of the Company, MDU and
its Affiliates, and the Plan with respect to such payment.

     4.6  Tax Withholding.  The Company (or Trustee, as the case
may be) shall deduct from any payment or share delivery made
under this Plan an amount equal to, or shares having a value
equal to, all or part of the federal, state and local taxes
required by law to be withheld by the Company (including but not
limited to any amount that may be necessary to satisfy applicable
income tax withholding and employment tax obligations, as well as
the Company's portion of all such applicable taxes), all
garnishments, and any other amounts required to be withheld by
applicable law or court order.

                            ARTICLE V
                    BENEFICIARY DESIGNATIONS

     5.1  Designation of Beneficiary.  Each Participant may
designate, in the form and the manner specified by the
Administrator, a Beneficiary to receive the payment (if any) due
under Article IV at the Participant's death.  The Beneficiary of
a married Participant shall be the Participant's spouse, unless
the Participant designates a Beneficiary other than the spouse
and the spouse consents in writing to the designation in the form
and the manner prescribed by the Administrator.  A Participant
may revoke such designation at any time and substitute therefor
another Beneficiary.  A married Participant may revoke a prior
Beneficiary designation only with the consent of his or her
spouse in the form and the manner prescribed by the
Administrator.  A designated spousal Beneficiary who becomes
divorced from the Participant shall be deemed to have predeceased
the Participant on the date the divorce is final; subject,
however, to redesignation thereafter under this section.

     5.2  Failure To Designate a Beneficiary.  If upon the death
of an unmarried Participant a Beneficiary has not been validly
designated, the Beneficiary shall be the Participant's estate.

                           ARTICLE VI
                TRUST OBLIGATION TO PAY BENEFITS

     6.1  Establishment of Trust.  Immediately following the
Purchase, MDU shall establish a Trust to hold the MDU Shares
credited to all Accounts as described in Section 3.1.  The assets
of any such Trust shall be subject to the claims of MDU's
creditors and the Company's creditors and shall be maintained
pursuant to a separate trust document generally conforming to the
terms of the model trust described in Revenue Procedure 92-64.

     6.2  Benefits Paid From Trust.  Any payment required to be
made under this Plan to a Participant or Beneficiary shall be
paid by the Trustee to the extent of the assets held in the Trust
by the Trustee, and by the Company to the extent the assets in
the Trust are unavailable to pay such amount.

                           ARTICLE VII
                    ADMINISTRATION AND CLAIMS

     7.1  Plan Administration.  The Administrator shall have sole
discretionary responsibility for the operation, interpretation,
and administration of the Plan.  The Company shall make available
to the Administrator all information necessary and appropriate to
the proper administration of the Plan.  Any action taken on any
matter within the discretion of the Administrator shall be final,
conclusive, and binding on all parties.  In order to discharge
its duties hereunder, the Administrator shall have the power and
authority to adopt, interpret, alter, amend or revoke rules
necessary to administer the Plan, to delegate its duties and to
employ such outside professionals as may be required for prudent
administration of the Plan.  The Administrator shall also have
the right within the scope of the Administrator's authority (if a
designee of the Company) to enter into agreements on behalf of
the Company necessary to administer the Plan.  Any Participant
who is acting as Administrator shall not be entitled to make
decisions with respect to his or her own participation and
entitlement to payment under the Plan.

     7.2  Plan Documents.  Upon becoming a Participant the
Company shall provide each Participant (i) a copy of this Plan
document (without Schedule A) and (ii) the information contained
in Schedule A specifying the Participant's award under the Plan.
At no time shall a Participant be entitled to information
relating to awards made to other Participants.

     7.3  Claims Procedures

     (a)  Applicability.  This section sets forth the exclusive
procedures governing benefits under the Plan.  No legal action
may be brought by any person claiming entitlement to benefits
until after the procedures set forth herein have been exhausted.

     (b)  Administrator Computes and Communicates Benefit.  Before a
Participant's Vesting Date, the Administrator shall send to the
affected Participant (or Beneficiary, as the case may be) and to
the Trustee a written notice setting forth the Participant's
Account balance.  Unless the Company notifies the Trustee prior
to the Vesting Date that the Participant has forfeited the
Participant's Account, the Trustee shall deliver the MDU Shares
in Participant's Account (less any amount for taxes described in
Section 4.6) automatically on the Participant's Vesting Date.

     (c)  Claim for Benefits.  Any person claiming entitlement to
benefits for which the Administrator refuses to authorize payment
shall file a written claim for benefits with the Administrator at
the offices of the Company.  The claim must set forth the basis
for the claim and be signed by the claimant.

     (d)  Determination.  Within 60 days of receiving a claim for
benefits, the Administrator shall make a determination on the
claim, and notify the claimant in writing of the determination.
If the claim is approved, the Administrator shall direct the
Trustee to commence payment in accordance with the provisions of
Article IV.  If the claim is denied, in whole or in part, the
Administrator's notice to the claimant shall explain the specific
reasons for the denial, refer to the specific Plan provisions on
which the denial is based, describe any additional material or
information necessary for the claimant to perfect the claim (if
possible), and explain the steps and time limit for requesting
appeal of the determination.

     (e)  Appeal of Determination.  A claimant (or authorized
representative) shall have 60 days in which to file an appeal of
the determination, measured from the date the Administrator's
notice described in paragraph (d) is mailed.  An appeal must (i)
be in writing, (ii) set forth each ground and supporting fact on
which the appeal is based and (iii) provide any other comments
the claimant believes pertinent and helpful to his or her appeal.
When making an appeal, a claimant may review the documents that
were pertinent to the Administrator's denial of the claim.  Any
claimant who fails to file an appeal timely shall be estopped and
barred from any further challenge to the Administrator's
determination to deny the claim.

     (f)  Review by Committee.  Upon receipt of a written appeal, the
Company shall appoint a committee, composed of at least 2
individuals who did not participate in the original denial of the
claim, to conduct a full and fair review of the appeal.  The
committee shall complete its review and decide the appeal within
60 days after the written appeal was received by the Company.  In
conducting its review, the committee may, in its sole discretion,
require the Company or the claimant to submit such additional
documents or other evidence as the committee deems necessary or
appropriate.  The review committee's decision shall be final and
binding on all persons with respect to the claimant's appeal.  If
the appeal is denied in whole or in part, the committee shall
notify the claimant in writing, setting forth the specific
reasons for the denial and the specific plan provisions on which
the denial is based.  The committee shall have the sole
discretion to interpret any provision of the Plan that is
pertinent to the outcome of the appeal.

     7.4  Reimbursement of Costs.  If any person institutes legal
action to enforce any of the provisions of the Plan, the
prevailing party in such legal action shall be reimbursed by the
other party for the prevailing party's costs, including, without
limitation, reasonable fees of attorneys, accountants and similar
advisors, and expert witnesses.

                          ARTICLE VIII
                          MISCELLANEOUS

     8.1  Nontransferability.  The right of a Participant or
Beneficiary to benefits under the Plan shall not be assigned,
alienated, transferred, pledged or encumbered.  Neither the
Company, MDU and its Affiliates, nor the Plan shall be liable for
or subject to the debts or liabilities of a Participant.

     8.2  Binding Effect.  The Plan shall be binding upon and
inure to the benefit of the Company, its successors and assigns,
and the Participant and his or her heirs, executors,
administrators and legal representatives.

     8.3  No Rights Implied.  No Plan provision shall confer upon
any Participant the right to continue as a member of the Board or
as an employee of the Company or MDU and any of its Affiliates.

     8.4  Applicable State Law.  The Plan shall be construed in
accordance with and governed by the laws of the State of Oregon.

     8.5  Entire Agreement.  The Plan constitutes the entire
understanding and agreement with respect to the subject matter
contained herein, and there are no agreements, understandings,
restrictions, representations or warranties among any Participant
or Beneficiary and the Company other than those set forth or
provided for herein.

     8.6  Amendment or Termination of Plan.  The Company may
amend or terminate the Plan at any time; provided, however, that,
except as provided in Article I, no such amendment or termination
shall be effective if it has the effect of eliminating or
reducing a Participant's Account below the balance calculated
under the Plan immediately before giving effect to such amendment
or termination.  In the event the Plan terminates, any residual
assets of the Plan's Trust that are not distributable to any
Participant shall be returned to MDU.

                           ARTICLE IX
                           DEFINITIONS

          The following terms shall have the meanings set forth
in this article, unless a different meaning is plainly required
by the context:

          "Account" means the book entry account established and
maintained for each Participant under Section 3.1.

          "Administrator" means a committee of two or more
individuals as selected to serve by the Board.  If no such
committee exists, then the Administrator means the Board.

          "Affiliate" means any parent corporation (within the
meaning of Code Section 424(e)) or subsidiary corporation (within
the meaning of Code Section 424(f)).

          "Beneficiary" means an individual, trust or other
entity entitled to receive payment on account of a Participant's
death.

          "Board" means the board of directors of the Company.

          "Code" means the Internal Revenue Code of 1986, as
amended.

          "Company" means Oregon Electric Construction, Inc., an
Oregon corporation.

          "Effective Date" means the effective date of this Plan
set forth in Article I.

          "MDU" means MDU Resources Group, Inc., a Delaware
corporation.

          "MDU Share" means one share of the Common Stock, and
the associated preference share purchase rights, of MDU.

          "Participant" means an individual named in Schedule A
until such time as the individual has forfeited or been paid his
or her Account.

          "Plan" means this Oregon Electric Construction, Inc.
Deferred Compensation Plan as set forth herein, as it may be
amended from time to time.

          "Plan Year" means each calendar year.

          "Purchase" means the purchase of the Company by Utility
Services, Inc., a Delaware corporation, pursuant to the Stock
Purchase Agreement referred to in Section 3.1.

          "Purchase Date" means the closing date of the Purchase.

          "Termination" means the Participant terminates
employment with all of (i) MDU, (ii) any Affiliates of MDU
(including the Company) and (iii) any other entity to which
substantially all of the assets of the trade or business of the
Company have been transferred (directly or indirectly).

          "Termination for Cause" means a Termination occasioned
by the Participant's (i) criminal conduct, (ii) failure to
perform duties with the skill, knowledge, and diligence
reasonably expected of personnel in similar positions or refusal
to carry out such reasonable tasks as reasonably directed, (iii)
refusal to perform employment duties on a full-time basis, (iv)
refusal to act in accordance with any lawful instructions of a
more senior employee, or (v) misconduct which could be seriously
damaging to the Company without a reasonable good faith belief by
the Participant that the conduct was in the best interest of the
Company.

          "Trust" means the legal entity created by the Trust
Agreement.

          "Trust Agreement" means the trust instrument entered
into among MDU, the Company and a trustee, as it may be amended
from time to time.

          "Trustee" means the trustee serving from time to time
under the Trust Agreement.

          "Vesting Date" means, for a Participant, the date set
forth opposite the Participant's name on Schedule A.

          IN WITNESS WHEREOF, the Company has caused this Plan to
be executed by a duly authorized officer effective as of the
Effective Date.

                              OREGON ELECTRIC CONSTRUCTION, INC.



                              By:  /s/  GLENN W. PATTERSON
                                 Glenn W. Patterson, President



                           SCHEDULE A



The maximum number of shares that could be issued under this
Plan, as of the Plan's adoption date, was 58,816 shares (not
adjusted for the October 2003 three-for-two stock split).