Nicor Inc.
                                                            Form 10-K
                                                            Exhibit 10.24


Nicor Gas


                            SECURITY PAYMENT PLAN
          As Amended and Restated Effective as of December 31, 1998


A  Security  Payment  Plan is  authorized  for all  Nicor  Gas  employees,  (the
"Company"), each of whom meets the following eligibility conditions:

o  Is in salary grade  Executive 1 or higher,  and reaches age 30 and  completes
   five years of service, or completes ten years of service, and

o  Is employed by the Company at the time of death, or disability  which results
   in retirement from the employ of the Company, as the case may be, and

o Has been employed by the company continuously since December 31, 1998.

Subject to the foregoing the Security Payment Plan provides:

I.    Should an eligible employee become disabled and/or die, the Company
      will pay (A) to the disabled employee, or (B) to the spouse surviving
      an employee who dies before attaining age 55, until such time as the
      employee would have attained age 55, if living, or until the spouse's
      death, or (C) if there be no surviving spouse or should the spouse die
      before the employee would have attained age 55, if living, to the
      employee's children, if any are living on the date of payment, in equal
      shares, a total annual sum equal to retirement benefits based on
      "normal retirement date."  Any payments under this provision will be
      made only to the eligible employee, while living, and be subject to
      income offsets as provided for in Sections V and VI.  If the disabled
      employee dies before attaining age 65, death benefits will be paid to
      the appropriate survivor according to the terms herein described.

      "Disabled"  is  herein  defined  to cover an  eligible  employee  whom the
      Compensation Committee of the Company's Board of Directors deems unable to
      perform  satisfactorily  a  position's  essential  duties  due to  medical
      reasons extending beyond twelve months.

      "Final earnings" as used herein are equal to the employee's highest annual
      salary  rate from the  Company  during  the  60-month  period  immediately
      preceding death or disability retirement.

      "Normal  retirement  date" is  herein  defined  to be the first day of the
      month next following the employee's 65th birthday.

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      "Service"  is  herein  defined  to equal the  years of  service  which the
      employee  would  have  accrued  from the most  recent  date of hire if the
      employee had  continued in the employ of the employer  until the date that
      otherwise would have been the normal retirement date.

      Said benefits are to be calculated as follows:

         A. 1.25% of the first $27,300* of final earnings times years of service
            through 30; plus

         B. 1.80% of the final earnings in excess of $27,300* times years of
            service through 30; plus

         C. 1.25% of the final earnings for each year of service over 30 years.

            *This amount is indexed 5% per year; in 1998 it is $27,300.

      "Spouse"  as used  herein  shall be defined as a member of the  employee's
      household on the date of the  employee's  death,  who married the deceased
      employee in a religious or civil ceremony recognized under the laws of the
      state or country where the marriage was contracted at least one year prior
      to:

         A.    The date of the employee's death, or

         B.    The date of disability retirement,

      whichever shall occur first.

II.   After the date the deceased  eligible employee would have attained age 55,
      the  Company  will pay to the  spouse,  if living,  until death an amount,
      which,  when  added to the  annual  payments  from the  Company's  defined
      benefit Retirement and Supplemental Retirement Plans, will be equal to 50%
      of the benefits as hereinbefore calculated. Payments, if any, to children,
      will cease after the date the eligible  employee  would have  attained age
      55.

III.  Should an  eligible  employee  die after  attaining  age 55,  whether as a
      result of prior  disability  or not,  but  before  attaining  age 65,  the
      Company will pay to the spouse, until death, an annual amount, which, when
      added to the annual payments from the Company's defined benefit Retirement
      and Supplemental  Retirement Plans will be equal to 50% of the benefits as
      calculated under Section I, above.

IV.   Payments  under  this Plan  shall be made in equal  monthly  or  quarterly
      installments.


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V.    A. Payments made to the spouse or children of an eligible employee
         under the Illinois Workers' Compensation Act, or other similar awards
         (excluding Social Security Act benefits) which result from government
         programs  financed or paid for (in whole or in part) through employer
         contributions,  will reduce payments under the Plan dollar-for-dollar.

      B. Payment made to a disabled employee or eligible survivor under
         disability retirement benefits from the Company's defined benefit
         Retirement and Supplemental  Retirement  Plans,  Early  Retirement
         benefits from said Retirement Plan, the Company's Long-Term  Disability
         Plan, awards under the Illinois  Workers'  Compensation Act, or other
         similar awards which result from  government  programs  financed or
         paid for (in whole or in part) through employer  contributions,  will
         reduce payments under this Plan dollar-for-dollar.

VI.   Should a spouse be receiving payments from the Security Payment Plan prior
      to the date the deceased eligible employee would have attained age 55 and
      also be receiving  payments  from the Company's  defined  benefit
      Retirement  and Supplemental  Retirement Plans, then the benefits
      calculated under Section I, above, will be reduced by such payments from
      the said Retirement Plans.