AGREEMENT


                                 By and Between


                       KeySpan Energy Trading Services LLC


                                       and

                           Coral Energy Holding, L.P.




                              Dated: April 1, 2000



<PAGE>




<TABLE>
                                TABLE OF CONTENTS
                                -----------------
<CAPTION>
SECTION                                                                              SECTION NUMBER
--------                                                                             --------------
<S>                                                                                         <C>

Recitals

Purpose                                                                                       1

Scope                                                                                         2

Definitions                                                                                   3

Joint Oversight Committee                                                                     4

KeySpan Energy Trading-Related Transactions                                                   5

CORAL-Related Transactions                                                                    6

KeySpan Energy Trading Book                                                                   7

CORAL Book                                                                                    8

KeySpan Energy Trading Shareholder Targets                                                    9

Contract Years                                                                                10

CORAL Guarantees KeySpan Energy Trading Shareholder Targets                                   11

Sharing of Gains/Losses From KeySpan Energy Trading Book                                      12

Costs of Rendering Services Under the Agreement                                               13

Sharing of Gains/Losses From CORAL Book                                                       14

Responsibility for Penalty Payments                                                           15

Reporting By Parties and Reconciliation of Accounts                                           16

Settlement of Transactions at Expiration or Termination of Agreement                          17
           A.        CORAL Book
           B.        KeySpan Energy Trading Book
           C.        Pro Rating for Early Termination
</TABLE>



<PAGE>





<TABLE>
                                TABLE OF CONTENTS
                                -----------------
<CAPTION>
SECTION                                                                                 SECTION NUMBER

<S>                                                                                         <C>
Exclusivity                                                                                  18
Payments                                                                                     19

Effective Date and Term of Agreement                                                         20

Termination by KeySpan Energy Trading                                                        21

Termination by CORAL                                                                         22

Termination for Bankruptcy Event                                                             23

Notice Required for Early Termination                                                        24

Access to Records                                                                            25

Support from KeySpan Energy Trading                                                          26

Support from CORAL                                                                           27

Representations                                                                              28

Conflicts Waiver                                                                             29

Transactions and Relationships Outside this Agreement                                        30

Limitation of Liability                                                                      31

Indemnification                                                                              32
           A.        Indemnification by KeySpan Energy Trading
           B.        Indemnification by CORAL

Confidentiality                                                                              33

Notices and Communications                                                                   34

Miscellaneous                                                                                35

Governing Law and Jurisdiction                                                               36
Other Services                                                                               37
</TABLE>


<PAGE>





<TABLE>
                                TABLE OF CONTENTS
                                -----------------
<CAPTION>
SECTION                                                                                      SECTION NUMBER

<S>                                                                                                 <C>
Affiliate Services                                                                                   38

Sole Engagement                                                                                      39

Force Majeure                                                                                        40

Severability                                                                                         41

Use of Name                                                                                          42

Insurance                                                                                            43
           A.        CORAL Insurance
                     (i)       Coverage
                     (ii)      Insurance Notification
                     (iii)     Insurance No Limit
                     (iv)      CORAL Option to Self Insure
                     (v)       Subcontractor Compliance
           B.        KeySpan Energy Trading Insurance

Section Headings                                                                                     44

Waiver     45

No Relationship Created                                                                              46

Survival of Obligations                                                                              47
</TABLE>


<PAGE>



                                    AGREEMENT

           This  Agreement  (the  "Agreement"),  dated April 1, 2000,  is by and
between KEYSPAN ENERGY TRADING  SERVICES LLC ("KeySpan Energy  Trading"),  a New
York  limited  liability  company  with  offices at 100 East Old  Country  Road,
Hicksville, New York 11801, and CORAL ENERGY HOLDING, L.P. ("CORAL"), a Delaware
limited partnership with offices at Suite 700, 909 Fannin Street, Houston, Texas
77010. KeySpan Energy Trading and CORAL are individually  referred to herein, as
the context requires, as a "Party" and collectively as the "Parties."

                                    RECITALS

           KeySpan Energy Trading is a subsidiary of KeySpan  Corporation  d/b/a
KeySpan Energy, provides fuel management services to its affiliates The Brooklyn
Union Gas Company d/b/a  Brooklyn Union and KeySpan Gas East  Corporation  d/b/a
Brooklyn  Union of Long Island and  provides  fuel  management  services to LIPA
pursuant to the EMA; and
           CORAL is currently providing certain asset management  assistance and
certain risk management  advisory services to KeySpan Energy Trading with regard
to the management of the energy assets of Brooklyn Union of Long Island and fuel
and energy  management for LIPA pursuant to a separate  agreement (the "Alliance
Agreement").  In  addition,  CORAL is  currently  providing  certain  technology
hosting services to KeySpan Energy Trading pursuant to a separate agreement (the
"Hosting  Agreement ") which Hosting  Agreement will continue in accordance with
its terms; and
           KeySpan  Energy  Trading  wishes to  contract  with CORAL for certain
asset  management  assistance and risk management  advisory  services to enhance
collaboration  of  supply,  trading,  and  risk  management  activities  for the
management of the energy assets of Brooklyn Union, Brooklyn Union of Long Island
and fuel and energy management for LIPA; and
           CORAL wishes to contract with KeySpan  Energy Trading to provide such
           services;

     NOW  THEREFORE,  in  consideration  of the mutual  promises  and  covenants
contained  herein,  and for other good and valuable  consideration,  the Parties
hereby agree as follows:





<PAGE>



1.         Purpose

           Pursuant  to this  Agreement,  which will  supersede  and replace the
Alliance Agreement,  CORAL and KeySpan Energy Trading collaborate to (a) develop
a strategy  to enhance  utilization  of all energy  supply,  transportation  and
storage  contracts  of Brooklyn  Union and Brooklyn  Union of Long  Island,  (b)
employ  CORAL's  industry  knowledge and  expertise  regarding  risk  management
methodologies  and trading  activities  with  respect to fuel oil,  natural gas,
electricity and emission credits, (c) enhance KeySpan Energy Trading's knowledge
and understanding of the energy marketplace and the available products, services
and  information  technology  to  facilitate  energy  transactions,  (d) enhance
CORAL's  knowledge and  understanding  of the Northeast  energy market,  and (e)
engage in "arms  length"  energy  transactions  for the  mutual  benefit  of the
Parties, their shareholders,  customers, and Coral's partners, as applicable and
as further described in this Agreement.

2.         Scope

           CORAL  will  assist  KeySpan  Energy  Trading  in  the   origination,
structuring, valuation, and execution of energy-related transactions related to,
among  other  things,  the  storage,  transportation,  transmission,  sale,  and
purchase of natural gas, fuel oil, electricity and emission credits.  CORAL will
share with KeySpan Energy Trading its knowledge of these  activities  including,
but not  limited  to,  the  structuring  and  decision-making  process  enabling
implementation of these activities and the monitoring,  tracking, and evaluation
of the results thereof.  CORAL personnel (i.e., a minimum of four staff members)
will work with KeySpan Energy Trading  personnel at KeySpan Energy Trading's New
York  offices.  CORAL  shall  assign  additional  CORAL  personnel  who  will be
responsible  for all  activities  relating to the  nominating  and scheduling of
natural gas supplies for KeySpan Energy Trading's  regulated natural gas utility
affiliates  (i.e.,  Brooklyn Union and Brooklyn  Union of Long Island),  KeySpan
Energy  Trading's on- and off-system fuel management  transactions,  and KeySpan
Energy Trading's other off-system gas transactions.  KeySpan Energy Trading will
provide all information to CORAL on a timely basis in order for CORAL to perform
such  nominating  and  scheduling  activities.  CORAL will follow KeySpan Energy
Trading's  lawful   instructions  in  such  regard,   and  to  the  extent  such
instructions are not provided by KeySpan Energy




<PAGE>



Trading  on a  timely  basis,  CORAL  will be under  no  obligation  and have no
liability  with regard to  nominations  and  scheduling for which it receives no
instructions from KeySpan Energy Trading.
           CORAL shall  confirm all gas supplies  purchased  for Brooklyn  Union
sales  customers,  shall provide  KeySpan  Energy  Trading with daily gas supply
confirmation  reports in sufficient  detail to satisfy  KeySpan  Energy  Trading
requirements and will assist KeySpan Energy Trading  personnel in confirming gas
for electric  generation  for LIPA.  The  confirmation  activities  performed on
behalf of Brooklyn  Union shall continue until such time as required by Brooklyn
Union.  The target date for  Brooklyn  Union to confirm its gas supplies is June
30,  2000.  In the event the target  date needs to be  extended  beyond June 30,
2000, KeySpan Energy Trading will provide CORAL with notice of such modification
to the  target  date by no later than June 1,  2000.  CORAL  will not,  however,
perform gas scheduling and confirmation  activities  relating to  transportation
marketer  gas,  and  will  not be  provided  with  information  associated  with
individual  marketer  supplies on the Brooklyn  Union or Brooklyn  Union of Long
Island systems.
           CORAL will  perform  deal  entry,  pathing  and other data entry into
KeySpan Energy  Trading's GMS system licensed to KeySpan Energy Trading by Altra
Software Services, Inc. ("Altra"),  provided that KeySpan Energy Trading obtains
written approval from Altra to allow CORAL to perform the foregoing duties,  and
KeySpan Energy Trading  obtains and pays for a sufficient  number of licenses to
satisfy CORAL's  requirements to perform such functions.  If at any time Altra's
written approval is rescinded or CORAL's duties hereunder  conflict with CORAL's
license  agreements  with Altra,  CORAL will suspend  performing such duties and
CORAL and KeySpan  Energy  Trading will mutually  agree on a course of action to
take.
           CORAL will  perform the  reconciliation  of gas supplier and pipeline
invoices.  CORAL will also  prepare and send the  invoices  for  KeySpan  Energy
Trading's  off-system gas sales and provide KeySpan Energy Trading copies of all
invoices and reports  sufficient for KeySpan Energy Trading to process,  record,
pay,  and/or  collect  costs and revenues  relating to KeySpan  Energy  Trading-
Related Transactions.  Through this Agreement,  KeySpan Energy Trading and CORAL
may engage in KeySpan Energy Trading-Related Transactions (as defined in Section
5) and CORAL-Related  Transactions (as defined in Section 6). It is contemplated
that this relationship will enhance the




<PAGE>



value of and  facilitate  increased  utilization  of all of  Brooklyn  Union and
Brooklyn Union of Long Island's energy contracts, thereby reducing costs through
lower fuel prices and increased  off-system  sales credits and enhancing the net
margin contribution for KeySpan's shareholders and CORAL's partners.
           CORAL  and  KeySpan   Energy  Trading  shall  record  and  track  the
energy-related transactions and activities that each manages,  respectively. The
criteria  for  determining  whether a certain  energy-  related  transaction  or
activity will be managed by CORAL or KeySpan Energy Trading is set forth in this
Agreement.  The  Parties  will  periodically  report to each  other,  as further
described  in this  Agreement,  regarding  the gains and  losses,  revenues  and
expenses, and Incentive Revenues resulting from the energy-related  transactions
and  activities  that they manage  pursuant to this  Agreement.  This  Agreement
contemplates a sharing of Incentive  Revenues and net margin  contributions from
these  energy-related  transactions  by  the  Parties,  as  set  forth  in  this
Agreement.
           NOTHING IN THIS AGREEMENT  SHALL BE CONSTRUED TO BE A  RELINQUISHMENT
OF KEYSPAN ENERGY TRADING'S CONTROL OVER THE ENERGY CONTRACTS AND ASSETS THAT IT
MANAGES.
3.         Definitions

           For purposes of this  Agreement,  the following  terms shall have the
           meanings set forth  below:

     Ancillary  Services - Operating reserves provided by the KeySpan generation
     facilities that serve LIPA pursuant to the PSA.

     Base Gas - Non-working inventory storage gas.

     BNY - Brooklyn Navy Yard Cogeneration Partners, L.P.

     BNY Agreement - The Second Revised Fuel Management  Agreement between LILCO
     and BNY, dated September 25, 1996, and all subsequent amendments,  assigned
     to KeySpan.

     Book - An account for reporting Incentive Revenues, net margin contribution
     (gain  or loss)  and  margins  above  cost  attributed  to  KeySpan  Energy
     Trading-Related Transactions and CORAL Related-Transactions and activities.

     CORAL Book - As set forth in Section 8, the book of business  maintained by
     CORAL with respect to CORAL Energy-Related Transactions.




<PAGE>



     CORAL-Related  Transactions - Those energy transactions which are specified
     in Section 6 of this Agreement.

     Costs for Rendering Services - An agreed upon amount  representing  CORAL's
     costs as determined  under Section 13 and as recovered by CORAL through the
     sharing of Excess Gain pursuant to Section 12.

     Electric Incentive - The revenue or loss from the incentive or disincentive
     resulting    from   the   revised    System   Power   Supply    Performance
     Incentive/Disincentive in Appendix B of the EMA.

     EMA - The Energy Management  Agreement by and between LILCO and LIPA, dated
     June 26, 1997.

     Energy  Management Fee - The fee for KeySpan Energy  Trading's  services as
     set forth in the EMA.

     Energy  Manager - The manager of LIPA's fuel  requirements  as set forth in
     the EMA.

     Fuel Incentive - The revenue or loss from the  incentives or  disincentives
     resulting  from the Fuel  Purchase  Performance  Incentive/Disincentive  in
     Appendix A of the EMA.

     Incentive  Maximums  - The limit as set  forth in the EMA that  effectively
     caps  the  maximum  revenue  or  loss  available  for  sharing  under  this
     Agreement.

     Incentive  Revenues - The EMA Gas/Oil  Incentive  and  Electric  Incentive,
     collectively.

     KeySpan - KeySpan  Corporation  d/b/a KeySpan Energy,  formerly  MarketSpan
     Corporation, and/or its subsidiaries.

     KeySpan  Gas East  Corporation  d/b/a  Brooklyn  Union  of Long  Island - A
     subsidiary of KeySpan  Corporation and successor to LILCO for the provision
     of gas service in the jurisdictional territory formerly served by LILCO.

     KeySpan  Energy  Trading  Book - As set  forth  in  Section  7, the book of
     business  maintained  by KeySpan  Energy  Trading  with  respect to KeySpan
     Energy Trading-Related Transactions.

     KeySpan Energy Trading-Related  Transactions - Energy-related  transactions
     as defined in Section 5.

     KeySpan  Transaction - The combination of LILCO and KeySpan effective as of
     May 29, 1998  pursuant to the Amended and  Restated  Agreement  and Plan of
     Exchange and Merger between




<PAGE>



     The Brooklyn  Union Gas Company and LILCO,  dated as of June 26,  1997,  as
     amended by the Amendment,  Assignment and Assumption Agreement by and among
     The Brooklyn Union Gas Company,  LILCO, and KeySpan,  dated as of September
     29, 1997.

     LILCO - Long  Island  Lighting  Company  as it  existed  prior  to the LIPA
     Transaction.

     LIPA - Long Island Lighting  Company d/b/a LIPA, a wholly-owned  subsidiary
     of Long Island Power Authority (a corporate  municipal  instrumentality  of
     the State of New York).

     LIPA Agreement - The Agreement and Plan of Merger,  dated June 16, 1997, by
     and among BL Holding Corp., LILCO, LIPA and LIPA Acquisition Corp.

     LIPA  Transaction  - The merger  effective as of May 29, 1998 of LILCO with
     LIPA  Acquisition   Corp.,  a  New  York  corporation  and  a  wholly-owned
     subsidiary  of LIPA, at which time KeySpan  became the  successor  party to
     LILCO's interest in, among other things, the EMA and the PSA.

     NYSPSC - Public Service Commission of the State of New York

     Off-System Gas Sales or Off-System  Sales of Gas - The sale and/or delivery
     of natural gas by KeySpan  Energy  Trading on behalf of  Brooklyn  Union or
     Brooklyn Union of Long Island to parties located outside of the natural gas
     jurisdictional  territory  serviced by Brooklyn Union and Brooklyn Union of
     Long Island.

     Off-System  Sales of  Electricity  - The sale  and/or  delivery of electric
     energy,  including electric ancillary services by KeySpan Energy Trading on
     behalf of LIPA to parties  located  outside of the electric  jurisdictional
     territory formerly serviced by LILCO.

     PSA - Power Supply Agreement between LILCO and LIPA, dated June 26, 1997.

     Term - The term of this Agreement as set forth in Section 20.

4.         Joint Oversight Committee

           CORAL  and  KeySpan  Energy  Trading  shall  form a  Joint  Oversight
Committee  ("Committee") for the purpose of setting  strategies and oversight of
implementation  to enhance the value of the  assets,  contracts  and  incentives
managed by KeySpan  Energy  Trading for inclusion in the KeySpan  Energy Trading
Book as well as those  managed by CORAL for  inclusion  in the CORAL  Book.  The
focus of the Committee is to direct the Parties toward a mutually agreed




<PAGE>



platform for growth.  The Committee will meet  quarterly to monitor  performance
and make course  adjustments  to the agreed  goals.  In addition,  the Committee
shall be the forum for (i)  adjusting  the amount of the Contract  Year 2001 and
Contract Year 2002 CORAL  guaranty,  if warranted,  as provided for in Section 9
and for (ii) setting  CORAL's Costs for Rendering  Services under this Agreement
for such  contract  years  pursuant to Section 13. The  Committee  will  conduct
quarterly meetings,  and call any special meetings that are necessary to discuss
performance  results,  to project  expected  future  revenues  and  margins,  to
identify and resolve issues affecting the successful  performance of the Parties
under this Agreement,  to discuss transaction strategies and to resolve disputes
between the Parties.
           The Committee shall be composed of two representatives from CORAL and
two  representatives  from  KeySpan.  Each Party  shall  submit the names of its
designees  to the  other  Party  for  approval,  with  such  approval  not to be
unreasonably   withheld.   If  written  notice  of  objection  to  a  designated
representative is not received by the designating Party within ten (10) business
days  of   transmitting   the   designation  of  such   representative   to  the
non-designating Party, such designated  representative will be deemed acceptable
to  the   non-designating   Party.  The  Parties  may  change  their  designated
representatives  to the  Committee  at any time during the Term by  transmitting
such designation to the non-designating Party.
5.         KeySpan Energy Trading-Related Transactions

           KeySpan  Energy  Trading  shall  enter into and manage the  following
energy-related  transactions,  relating  solely to those assets  KeySpan  Energy
Trading  manages for Brooklyn Union and Brooklyn Union of Long Island,  the fuel
and system power  management  services  KeySpan Energy Trading  provides to LIPA
under the EMA,  which are hereby  defined  as  "KeySpan  Energy  Trading-Related
Transactions:"

     a.   Off-System Gas Sales, excluding sales of Base Gas;

     b.   Service  provided  under fuel  management  agreements to third parties
          other than LIPA;

     c.   Sales of emission  credits and related  transactions  to parties other
          than LIPA or to LIPA  pursuant to LIPA's right of first  refusal under
          the PSA, excluding the transfer, sale, or




<PAGE>



donation of emission  credits  pursuant to any agreement or  settlement  entered
into between KeySpan and any government entity or not-for-profit entity;

           d.        Off-System Sales of Electricity and Ancillary Services;

           e.        Electric Incentive;

           f.        Fuel Incentive; and

           g.        EMA Management Fee.

           In addition,  CORAL and KeySpan  Energy  Trading may  mutually  agree
during the Term to exclude certain  transactions from the KeySpan Energy Trading
Book and from being classified as a KeySpan Energy Trading-Related Transaction.

6.         CORAL-Related Transactions

           The  transactions  set  forth  in  this  Section  6  include  CORAL's
activities in physical and financial energy markets and are herein  collectively
defined as "CORAL-Related Transactions":

     a.   CORAL's  sales of natural  gas,  electricity,  fuel oil,  and emission
          credits  to  KeySpan  Energy  Trading,  on behalf of  Brooklyn  Union,
          Brooklyn Union of Long Island and LIPA;

     b.   CORAL's   transactional   activities   related   to   KeySpan   Energy
          Trading-Related  Transactions;

     c.   CORAL's transactional  activities related to any sales or purchases of
          natural gas, electricity, fuel oil, and emission credits between CORAL
          and KeySpan  Energy  Trading,  on behalf of Brooklyn  Union,  Brooklyn
          Union  of  Long   Island  and  LIPA,   provided   that   CORAL-Related
          Transactions shall not include the term contracts, as amended, between
          Shell Gas Trading and The Brooklyn  Union Gas Company,  dated  October
          20, 1987 and October 18, 1990  respectively,  which have been assigned
          to a  Coral  affiliate,  or any of  CORAL's  transactional  activities
          relating to such contracts; and

     d.CORAL financial transactions relating to KeySpan Energy Trading's hedging
          activities.




<PAGE>



           In addition,  CORAL and KeySpan  Energy  Trading may  mutually  agree
during the Term to  exclude  certain  transactions  from the CORAL Book and from
being classified as a CORAL- Related Transaction.

7.         KeySpan Energy Trading Book

           The KeySpan Energy  Trading Book records the net margin  contribution
allocated to KeySpan shareholders from the gains and losses derived from KeySpan
Energy Trading-Related Transactions.  The portion of the net margin contribution
allocated  to  KeySpan's   shareholders  from  KeySpan  Energy   Trading-Related
Transactions is determined as follows:

           1. Gas Off-System Sales Net Margin - KeySpan  shareholders'  share of
           the   margin    contribution    (gain/loss)   from   KeySpan   Energy
           Trading-Related  Transactions  involving  Off-  System Gas Sales,  as
           approved  by the  NYSPSC,  excluding  gas  originally  purchased  for
           generation unless and until KeySpan  shareholders share in the margin
           contribution  (gain/loss)  from the sale of gas originally  purchased
           for generation under the EMA or an amendment thereto.  Such margin is
           calculated as (i) gas sales revenue plus  applicable  hedging  gains,
           less  (ii)  all  relevant  costs   including   allocated  gas  costs,
           applicable  taxes,  applicable  hedging  costs and  losses,  variable
           transportation costs, and fixed costs incrementally incurred pursuant
           to such  transactions;  and

          2. Fuel Management  Agreement Margin - KeySpan  shareholders' share of
          the margin  contribution  (gain/loss) for services provided under fuel
          management  agreements  with BNY, Trigen and NYPA, and any future fuel
          management  agreements  entered  into by KeySpan  Energy  Trading with
          third parties during the Term, all as approved by the NYSPSC. The term
          "BNY  Margin"  shall mean  KeySpan  shareholders'  share of the margin
          received from the BNY  Agreement.  The BNY margin is calculated as (i)
          demand and  variable  charges  paid by BNY less $3 million;  plus (ii)
          KeySpan  shareholders'  share of the margin  contribution  (gain/loss)
          from  the  shared   BNY  fuel  cost   savings;   plus  (iii)   KeySpan
          shareholders'  share of the margin  contribution  (gain/loss) from the
          remarketing  of Excess BNY Gas as defined in the BNY  Agreement.  NYPA
          Margin shall mean the KeySpan  shareholders'  share of the margin from
          the NYPA fuel  management  agreement,  currently  one  hundred  (100%)
          percent





<PAGE>



           of the revenue.  Trigen  Margin shall mean the KeySpan  shareholders'
           share of the margin from the Trigen fuel  management  agreement.  The
           margin from such  agreement is  calculated as (i) demand and variable
           charges  paid by  Trigen  less  (ii)  all  relevant  costs  including
           allocated gas costs,  applicable taxes,  applicable hedging costs and
           losses,  variable  transportation costs and fixed costs incrementally
           incurred pursuant to such  transaction;

          3.  Emission  Credits  Margin - KeySpan's  shareholders'  share of the
          margin  contribution  (gain/loss) from KeySpan Energy  Trading-Related
          Transactions   involving   sales  of  emission   credits  and  related
          transactions,  as set forth in the PSA.  Such margin is  calculated as
          (i) the revenue received for such sales plus applicable  hedging gains
          less (ii) the costs of such credits including  applicable  transaction
          costs (e.g.,  broker fees,  taxes) and  applicable  hedging  costs and
          losses associated with such transactions; and

          4.  Off-system  Sales of Electricity  and Ancillary  Services Margin -
          KeySpan  shareholders'  share of the margin  contribution  (gain/loss)
          from KeySpan Energy Trading- Related Transactions involving off-system
          sales of electricity  and Ancillary  Services as set forth in the EMA.
          Such margin is calculated as (i) electric and ancillary  sales revenue
          plus  applicable  hedging  gains,  less (ii) the  incremental  cost of
          energy for such sales including any other costs or charges  (including
          applicable taxes and applicable  hedging costs and losses) incurred to
          produce and deliver the electricity  and/or  ancillary  services.  The
          incremental  costs shall include startup and no-load  operation costs,
          if applicable.  If any of these basic sharing  arrangements change due
          to NYSPSC  order or  subsequent  amendments  to the EMA,  PSA,  or BNY
          Agreement, the Parties agree that the Committee will review changes to
          the sharing  provisions,  the CORAL guaranty  amount and related CORAL
          costs to  render  service  in this  Agreement  that are  necessary  to
          comport with such orders or amendments;  provided  however,  that such
          changed provisions shall preserve,  to the extent reasonably possible,
          the rights and obligations of the Parties under this Agreement. To the
          extent the Parties  cannot  mutually agree to such  revisions,  within
          thirty (30) days of the date of such amendment or orders,




<PAGE>



          a Party may elect to terminate  this  Agreement  by  providing  notice
          pursuant to the provisions of Section 24 hereof.

           KeySpan    Energy   Trading   shall   manage   all   KeySpan   Energy
Trading-Related Transactions.

8.         CORAL Book

           The CORAL Book records the net margin contribution from the gains and
losses derived from CORAL-Related Transactions.  The CORAL Book reflects the net
margin contribution realized by CORAL from CORAL-Related Transactions.
           CORAL shall execute and manage transactions for the CORAL Book.
9.         KeySpan Energy Trading Shareholder Targets

           KeySpan  Energy  Trading  Shareholder  Targets  are based on  KeySpan
shareholders'   share  of  the  margins  from  KeySpan  Energy   Trading-Related
Transactions as described in Section 6.

     During the Term,  KeySpan  Energy  Trading  Shareholder  Target  will be as
     follows:

               a.   Calendar year 2000 - $25,063,000;

               b.   Calendar year 2001 - the greater of (i)  $25,063,000 or (ii)
                    KeySpan  shareholders'  share of the actual margins realized
                    from  KeySpan  Energy  Trading-   Related   Transactions  in
                    calendar year 2000, not to exceed a cap of $31,328,750; and

               c.   Calendar  year 2002 - the greater of (i)  $6,265,750 or (ii)
                    one-fourth  (1/4)  of  KeySpan  shareholders'  share  of the
                    actual margins realized from KeySpan Energy  Trading-Related
                    Transactions  in calendar year 2001,  not to exceed a cap of
                    $7,832,188.

           KeySpan  Energy Trading and CORAL,  through the  Committee,  mutually
agree to review the KeySpan Energy Trading Shareholder Target, the corresponding
cap  used  for the  calculation  of such  target,  and the  corresponding  CORAL
guaranty of such target,  for Calendar Years 2000,  2001 and 2002. The Committee
shall take into account any extraordinary market conditions or events including,
but  not  limited  to,  regulatory,  contractual  and  market  changes,  and any
extraordinary corporate event or transaction involving KeySpan Energy Trading or
its affiliates that will affect the targets in the relevant  calendar year(s) to
determine (i) if such  extraordinary  changes have occurred  whereby  conditions
existed in Calendar Years 2000 or 2001 that will not be replicated in the




<PAGE>



subsequent  Calendar Year thereby  warranting a reduction to the KeySpan  Energy
Trading Shareholder Targets as set forth in subsections b and c of this Section,
or (ii) if such  extraordinary  changes have occurred  whereby  conditions  will
exist in Calendar  Years 2001 or 2002  thereby  warranting  an increase to, or a
waiver of, the cap to be applied to the  setting of the KeySpan  Energy  Trading
Shareholder Targets as set forth in subsections b and c of this Section.

10.        Contract Years
           --------------

During the term of this Agreement, the Contract Years will be as follows:

          a.   Contract Year 2000 - April 1, 2000 through December 31, 2000;

          b.   Contract  Year 2001 - January 1, 2001 through  December 31, 2001;
               and

          c.   Contract Year 2002 - January 1, 2002 through March 31, 2002.

11.        CORAL Guarantees KeySpan Energy Trading Shareholder Targets

           CORAL hereby  guarantees to pay to KeySpan Energy Trading the KeySpan
Energy Trading  Shareholder Target for each Contract Year as set forth herein on
a prorated basis as applicable.  For Contract Year 2000, CORAL guarantees to pay
to KeySpan Energy Trading the prorated amount of $17,531,100.  For calendar year
2001,  CORAL  guarantees  to pay to KeySpan  Energy  Trading the KeySpan  Energy
Trading  Shareholder Target for Calendar Year 2001 and Calendar Year 2002 as set
forth in Section 9 above.

12.        Sharing of Gains/Losses From KeySpan Energy Trading Book

           At the end of each Contract Year, the gains and losses in the KeySpan
Energy  Trading  Book will be netted to produce an overall net gain or loss.  If
the KeySpan Energy Trading Book reflects an overall net loss,  CORAL will pay to
KeySpan Energy Trading the full amount of its guaranteed  KeySpan Energy Trading
Shareholder  Target for the  applicable  Contract  Year.  If the KeySpan  Energy
Trading  Book  reflects  an  overall  net  gain,  but such net gain is below the
guaranteed KeySpan Energy Trading Shareholder Target for the applicable Contract
Year,  CORAL will pay to KeySpan  Energy  Trading the  difference  between  such
overall  net gain and the  KeySpan  Energy  Trading  Shareholder  Target for the
applicable Contract Year. If the KeySpan Energy Trading Book reflects an overall
net gain that  exceeds the KeySpan  Energy  Trading  Shareholder  Target for the
applicable Contract Year, CORAL and KeySpan Trading will




<PAGE>



share the amount of the overall net gain that exceeds the KeySpan Energy Trading
Shareholder Target for the applicable  Contract Year ("Excess Gain").  CORAL and
KeySpan  Energy  Trading  shall share the Excess Gain sixty (60%)  percent/forty
(40%) percent, respectively, until such point when CORAL has recovered its Costs
for Rendering  Services under this  Agreement for the applicable  Contract Year.
Thereafter,  CORAL and KeySpan  Energy  Trading shall share the remainder of the
Excess  Gain,  if any,  fifty (50%)  percent/fifty  (50%)  percent.  All amounts
payable by CORAL to KeySpan Energy Trading or by KeySpan Energy Trading to CORAL
shall be paid within sixty (60) days from the end of each Contract Year, subject
to the provisions of Sections 10 and 16.

13.        Costs of Rendering Services Under the Agreement

           CORAL  and  KeySpan  Energy  Trading  agree  that  CORAL's  Costs for
Rendering  Services under this Agreement for each calendar year,  2000, 2001 and
2002, is $1,775,000 which,  prorated for Contract Year 2000, is $1,332,000,  and
prorated for Contract Year 2002, is $443,000.  The Parties  mutually  agree that
the  Committee  can  consider  modifying  the Costs for  Rendering  Services for
Contract  Year 2001 and Contract Year 2002 if a Party can  demonstrate  that the
Costs for Rendering Services for a Contract Year is not a reasonable  estimation
of the costs  CORAL will incur to provide  services  under this  Agreement.  The
Costs for Rendering  Services sets out the amount to recovered through the sixty
(60%)  percent/forty  (40%) percent  sharing  mechanism  pursuant to Section 12,
without regard to the actual cost to provide services in the applicable Contract

Year. 14. Sharing of Gains/Losses From CORAL Book

           At the end of each Contract Year under this Agreement,  the gains and
losses in the CORAL Book will be netted to produce an overall  net gain or loss.
If the CORAL Book contains an overall net gain, CORAL and KeySpan Energy Trading
shall share the overall net gain fifty (50%) percent/fifty (50%) percent. If the
CORAL Book  contains an overall net loss,  KeySpan is not obligated to CORAL for
any amount of the net loss.  All  amounts  payable  by CORAL to  KeySpan  Energy
Trading shall be paid within sixty (60) days from the end of each Contract Year.

15. Responsibility for Penalty Payments




<PAGE>



     Unless  otherwise  agreed to in  advance  by both  Parties,  any  penalties
incurred by KeySpan  Energy  Trading with respect to the KeySpan  Energy Trading
Book will not be subject to sharing with CORAL.  Unless  otherwise  agreed to in
advance by both  Parties,  any  penalties  incurred by CORAL with respect to the
CORAL  Book  will  not be  subject  to  sharing  with  KeySpan  Energy  Trading.
Notwithstanding the foregoing, CORAL shall pay all penalties incurred by KeySpan
that  resulted  from CORAL  actions or  omissions in  performing  the service of
scheduling natural gas deliveries as set forth in Section 2 above, provided that
CORAL shall not be obligated to pay such penalties if any of CORAL's  actions or
omissions were due to (i) following  instructions from KeySpan Energy Trading or
(ii) the  failure  of KeySpan  Energy  Trading  to  provide  CORAL  with  timely
nomination and scheduling instructions.

16.        Reporting By Parties and Reconciliation of Accounts

     The CORAL  Book and the  KeySpan  Energy  Trading  Book  shall be  reviewed
monthly by CORAL and KeySpan  personnel,  respectively.  Reports  concerning the
CORAL  Book  shall be  provided  monthly  based on a  mark-to-market  accounting
procedures. Reports concerning the KeySpan Energy Trading Book shall be provided
monthly  based on accrual  accounting  procedures  or, if deemed  acceptable  by
KeySpan's accountants at the time of the review, mark-to-market accounting. Each
month, the Parties will provide mutually agreed upon reports to the other Party.
Such reports shall include,  among other things,  activity to date, revenues and
expenses and net margin contribution.

17.        Settlement of Transactions at Expiration or Termination of Agreement

          Upon  expiration of the Term or  termination  of this  Agreement,  the
     following  procedures  shall be  implemented  to  settle  the  transactions
     contemplated herein:

           A.        CORAL Book

          Coral will  mark-to-market all existing positions except  transactions
     that the Parties had mutually agreed  previously to continue sharing in the
     gains and losses beyond the expiration or termination of this Agreement and
     will  implement the  allocation of gains and losses set forth in Section 14
     of this Agreement.




<PAGE>



           Unless the Parties have mutually agreed prior to the  commencement of
an individual  transaction  to continue  sharing the gains and losses beyond the
expiration or termination of this Agreement, there will be no further sharing of
gains and losses from the CORAL-Related Transactions.
           In the  event the  Parties  had  mutually  agreed  previously  for an
individual  transaction  to  continue  sharing  the gains and losses  beyond the
expiration or  termination  of this  Agreement,  the Parties shall also mutually
agree to such sharing mechanism and payment terms related thereto.
           In the  event the  Parties  had  mutually  agreed  previously  for an
individual  transaction  to  continue  sharing  the gains and losses  beyond the
expiration or termination of this  Agreement,  upon further mutual  agreement of
the Parties and at a mutually  agreed upon  price,  one Party may  purchase  the
other  Party's  entire  future  interest  (or  cash  out)  in the  CORAL-Related
Transaction.  After any such purchase, such transaction will no longer be deemed
a  CORAL-Related  Transaction and the Party whose interest was purchased will no
longer have any  responsibility  to maintain any obligation  under,  or right to
share in the net margin resulting from, any such  transaction  after the date of
such purchase.

           B.        KeySpan Energy Trading Book

           At the  expiration  or  termination  of this  Agreement,  the KeySpan
Energy  Trading  Book will  close and the gains and losses  will be  distributed
pursuant to Section 12.  Unless the Parties  have  mutually  agreed prior to the
commencement  of an  individual  transaction  to continue  sharing the gains and
losses beyond the expiration or termination of this Agreement,  there will be no
further  sharing of gains and losses  from the  KeySpan  Energy  Trading-Related
Transactions.
           In the  event the  Parties  had  mutually  agreed  previously  for an
individual  transaction  to  continue  sharing  the gains and losses  beyond the
expiration or  termination  of this  Agreement,  the Parties shall also mutually
agree to such sharing mechanism.
           In the  event the  Parties  had  mutually  agreed  previously  for an
individual  transaction  to  continue  sharing  the gains and losses  beyond the
expiration or termination,  and upon further mutual agreement of the Parties and
at a mutually agreed upon price, one Party may purchase the other Party's entire
future interest (or cash out) in the KeySpan Energy Trading-Related Transaction.





<PAGE>



After any such  purchase,  such  transaction  will no longer be deemed a KeySpan
Energy Trading-  Related  Transaction and the Party whose interest was purchased
will no longer have any  responsibility  to maintain any  obligation  under,  or
right to share in the net margin resulting from, any such transaction  after the
date of such  purchase.  The  KeySpan  Energy  Trading  Book will be adjusted to
reflect any mandated accounting changes,  NYSPSC regulations,  and modifications
in the LIPA Agreement, EMA and PSA.

           C.        Reconciliation of Accounts

               (i) At the expiration or termination of this  Agreement,  KeySpan
          Energy   Trading   will   estimate  the  margin   contribution   on  a
          mark-to-market   basis  of  any  KeySpan   Energy   Trading-   Related
          Transaction  in which CORAL will continue to retain an interest  after
          the expiration or termination of this Agreement. To the extent CORAL's
          share of such margin contribution would reduce the payment CORAL would
          make  to  KeySpan  Energy  Trading  under  Section   16C(iv)  of  this
          Agreement,  such  payment  will be reduced  by  CORAL's  share of such
          margin  contribution.  To the  extent  the  addition  of  this  margin
          contribution  to the KeySpan  Energy  Trading  Book would result in an
          increase in KeySpan Energy Trading's net payment to CORAL as described
          below in Section 16C(iv),  such margin  contribution will not be added
          to the payment by KeySpan Energy Trading,  and any appropriate payment
          will be made quarterly as prescribed in Section 16C(iii) below. To the
          extent the net margin contribution that otherwise would have been paid
          by CORAL to KeySpan  Energy  Trading has been reduced,  KeySpan Energy
          Trading  will reduce by an amount  equal to such  reduction  (on a net
          present  value  basis),  payments  otherwise  owed CORAL  pursuant  to
          Section 16C(iii) below.

               (ii)   Upon  the   termination   of  any  such   KeySpan   Energy
          Trading-Related  Transaction in question,  KeySpan Energy Trading will
          reconcile  the  actual  margin  contribution,  any  reductions  in the
          payment by CORAL to KeySpan Energy Trading  pursuant to Section 16C(i)
          above, and any reductions in quarterly payments made by KeySpan Energy
          Trading to CORAL pursuant to Section 16C(i), so that net payments will
          be  equal to what  they  would  have  been  for  such  KeySpan  Energy
          Trading-Related  Transaction  if the  payments  were made as described
          below in Section 16C(iii). KeySpan Energy Trading will notify CORAL in
          writing, and any net




<PAGE>



margin  contribution  owed by KeySpan  Energy  Trading to CORAL,  or by CORAL to
KeySpan Energy Trading will be paid within sixty (60) days of the termination of
each such KeySpan Energy Trading-Related Transaction.

               (iii)  With  respect  to  any  KeySpan   Energy   Trading-Related
          Transaction  in which CORAL will continue to retain an interest  after
          the  expiration or  termination of this  Agreement,  assuming  accrual
          accounting treatment,  the net margin contribution  resulting from the
          transaction  after expiration or termination of this Agreement will be
          calculated  quarterly  and will be  allocated  as  described  above in
          Section 12 and a disbursement  of funds will be made within sixty (60)
          days after the end of each quarter.

               (iv) At the expiration or termination  of this  Agreement,  after
          all  Incentive  Revenues  and  net  margin   contributions  have  been
          allocated  and offset as described in this  Agreement,  subject to (1)
          the  limitations on the sharing of net losses as described in Sections
          12 and 14 (2) the  guaranty  payment by CORAL as described in Sections
          11 and 16D and (3) any  change  in  CORAL's  costs to  render  service
          hereunder  pursuant  to  Sections  13 and 16D  hereof,  monies will be
          disbursed  as  follows:  there  will  be a  netting  of  the  Parties'
          positions  in the  KeySpan  Energy  Trading  Book  with  the  Parties'
          positions in the CORAL Book,  and any net amount due to one Party will
          be paid by the other Party within sixty (60) days of the expiration of
          this Agreement.

           D.        Pro Rating for Early Termination

     To the extent this Agreement  terminates for any reason prior to the end of
the Term, the guaranty  payable by CORAL for each Contract Year will be reduced,
pro  rata,  to the  date of  such  termination.  To the  extent  this  Agreement
terminates  prior  to the end of its  Term,  CORAL's  costs  to  render  service
hereunder  shall be reduced pro rata for the  applicable  Contract  Year, to the
date of termination.

18.        Exclusivity

           KeySpan Energy  Trading  agrees that during the Term,  KeySpan Energy
Trading will not,  without the prior  written  consent of CORAL,  enter into, or
participate  in, an alliance with any other person or entity,  whether within or
outside of the United States, for the purpose of (i) sharing any




<PAGE>



revenues,  margins  or money  associated  with  KeySpan  Energy  Trading-Related
Transactions,  and (ii) sharing energy market  information and  collaborating to
construct and implement a  comprehensive  strategy to enhance the utilization of
the physical  energy assets traded by KeySpan Energy Trading in the  competitive
energy market,  unless such alliance would become effective after the expiration
of the Term.  During the Term, as evidenced by this  Agreement,  KeySpan  Energy
Trading  hereby  enters into an exclusive  arrangement  for the type of services
provided by CORAL  hereunder,  and KeySpan Energy Trading shall not enter into a
competing  form of  arrangement,  contract or  relationship  with any commercial
bank, investment bank, trading house,  brokerage firm, financial consulting firm
or other person for the services to be provided by CORAL  hereunder  without the
prior written consent of CORAL.

19.        Payments

           All  payments  by and  between  the  Parties  shall be made in United
States dollars and shall be made net of any sales, use, excise,  transfer, gross
receipts,  capital gains,  or similar taxes (but not including  taxes imposed or
based upon net  income) to the extent  applicable.  If such taxes are imposed on
any payment,  KeySpan Energy Trading or CORAL, as the case may be, shall pay any
amounts to the other Party as shall be required so that the net amount  received
by CORAL and KeySpan  Energy Trading is the amount that CORAL and KeySpan Energy
Trading  would have  received had such taxes been  included as a cost before the
allocations  of the CORAL Book and KeySpan  Energy Trading Book had been made as
described  herein.  Any  amounts  payable by one party to the other  pursuant to
Sections  12,  14 and 17 may be  netted  and  offset  against  each  other.

20.        Effective Date and Term of Agreement

           This Agreement shall be effective as of April 1, 2000 (the "Effective
Date") and subject to the  provisions  for  termination  provided  herein,  this
Agreement shall continue through March 31, 2002 (the "Term").

21.        Termination by KeySpan Energy Trading

           KeySpan  Energy  Trading  shall  have  the  right to  terminate  this
Agreement if: (i) CORAL fails to pay any amounts due to KeySpan  Energy  Trading
from CORAL  pursuant to this  Agreement and such breach is not cured within five
(5) days following written notice from KeySpan Energy




<PAGE>



Trading;  (ii) CORAL otherwise  breaches this Agreement in any material respect,
and such breach is not cured within thirty (30) days  following  written  notice
from KeySpan Energy Trading;  (iii) any representations  made by CORAL hereunder
are false or  misleading  immediately  upon written  notice from KeySpan  Energy
Trading;  or (iv)  KeySpan is directed to terminate  or  materially  modify this
Agreement by a state or federal regulatory agency having  jurisdiction over such
matters.

22.        Termination by CORAL

     CORAL  shall have the right to  terminate  this  Agreement,  in whole or in
part,  if: (i) KeySpan Energy Trading fails to pay to CORAL amounts due to CORAL
from KeySpan  Energy  Trading  pursuant to this Agreement and such breach is not
cured with five (5) days  following  written  notice  from CORAL;  (ii)  KeySpan
Energy Trading  otherwise  breaches this  Agreement in any material  respect and
such breach is not cured within thirty (30) days  following  written notice from
CORAL;  (iii) any  representations  made by KeySpan Energy Trading hereunder are
false or misleading immediately upon written notice from CORAL; or (iv) CORAL is
directed to terminate  this  Agreement by a state or federal  regulatory  agency
having jurisdiction over such matters.

23.        Termination for Bankruptcy Event

           In the event that a  Bankruptcy  Event  occurs with respect to either
KeySpan  Energy  Trading or CORAL,  the other Party may terminate this Agreement
immediately  upon giving written notice to the other Party,  provided that CORAL
will  continue to provide the services set forth in the fourth,  fifth and sixth
sentences of paragraph 1 of Section 2,  paragraph 2 of Section 2, paragraph 3 of
Section 2 and paragraph 4 of Section 2 for an additional  ninety (90) days after
such termination for a mutually agreed upon fee.  "Bankruptcy  Event" shall, for
the  purposes  of this  Agreement,  mean with  respect to any  entity  that such
entity:  (i) becomes  insolvent or is unable to pay its debts as they become due
or admits in writing  its  inability  generally  to pay its debts as they become
due; (ii) makes a general assignment, arrangement or composition with or for the
benefit  of its  creditors;  (iii)  institutes  or has  instituted  against it a
proceeding  seeking a judgment of  insolvency  or bankruptcy or any other relief
under any bankruptcy or insolvency law or other similar law affecting creditors'
rights,  or a petition is presented for its winding-up or  liquidation,  and, in
the case of any such proceeding or petition  instituted or presented against it,
such proceeding or petition (a) results in a




<PAGE>



judgment of  insolvency  or bankruptcy or the entry of an order of relief or the
making of an order for its  winding-up or  liquidation  or (b) is not dismissed,
discharged,  stayed or  restrained  in each case  within  sixty (60) days of the
institution  or  presentation  thereof;  (iv) has a  resolution  passed  for its
winding-up,  official  management  or  liquidation  (other  than  pursuant  to a
consolidation,  amalgamation  or  merger),  (v) seeks or becomes  subject to the
appointment of an administrator,  provisional liquidator, conservator, receiver,
trustee,  custodian or other similar official for it or for all or substantially
all its assets;  (vi) causes or is subject to any event with respect to it that,
under the applicable laws of any jurisdiction, has an analogous effect to any of
the events specified in clauses (i) to (v) inclusive;  or (vii) takes any action
in furtherance  of, or indicating its consent to,  approval of, or  acquiescence
in, any of the foregoing acts.

24.        Notice Required for Early Termination

           A Party that elects to terminate this Agreement  pursuant to Sections
7, 21, 22 or 40, must do so by providing  ninety (90) days written notice to the
other Party.  After written notice has been served, the Agreement will terminate
on the last day of the calendar month in which the ninetieth day falls.

25.        Access to Records

           CORAL agrees to maintain detailed books, records, and accounts of the
affairs of CORAL in such a manner so as to permit  KeySpan Energy Trading or its
representatives  to ascertain  all  CORAL-Related  Transactions.  Subject to the
confidentiality  obligations  of the  Parties,  CORAL shall  permit any officer,
employee or agent of KeySpan Energy Trading,  with reasonable  notification,  to
inspect  such books and records of CORAL,  and discuss the affairs and  accounts
with  representatives of CORAL during normal business hours throughout the Term,
and for a  period  of one year  after  the  expiration  or  termination  of this
Agreement.
           KeySpan Energy Trading agrees to maintain  detailed  books,  records,
and accounts of the affairs of KeySpan  Energy Trading in such a manner so as to
permit CORAL to ascertain all KeySpan Energy Trading Energy-Related Transactions
and the Incentive Revenues.  Subject to the  confidentiality  obligations of the
Parties,  KeySpan Energy Trading shall permit any officer,  employee or agent of
CORAL, with reasonable notification, to inspect such books and records of




<PAGE>



KeySpan   Energy   Trading,   and  discuss  the   affairs  and   accounts   with
representatives   of  KeySpan  Energy  Trading  during  normal   business  hours
throughout  the Term,  and for a period  of one year  after  the  expiration  or
termination of this Agreement.

26.        Support from KeySpan Energy Trading

           KeySpan  Energy  Trading agrees to cooperate with CORAL in connection
with CORAL's  performance  of its  obligations  hereunder  and to furnish  CORAL
within a reasonable time with information  reasonably  requested by CORAL during
the Term.  KeySpan Energy Trading recognizes and confirms that in performing its
obligations,  CORAL (i) will be relying  on data and  instructions  provided  by
KeySpan Energy Trading with respect to KeySpan Energy Trading's operations, (ii)
will not  independently  verify the  accuracy or  completeness  of such data and
instructions  provided  by  KeySpan  Energy  Trading,  and (iii) does not assume
responsibility for, or for independently  verifying the accuracy or completeness
thereof.   CORAL  accepts  no  responsibility  for  any  erroneous  analyses  or
conclusions which flow from any inaccuracy or incompleteness of such information
or instructions provided by KeySpan Energy Trading, provided that such erroneous
analyses or  conclusions  are the direct result of the  inaccurate or incomplete
information or  instructions  provided by KeySpan Energy  Trading;  and provided
further  that  CORAL  shall  be  responsible   for   accurately   compiling  and
incorporating  assumptions,  projections  and figures in CORAL's  valuations and
models. Any report of CORAL may be based in part on the information  referred to
above and may be in such form as CORAL  shall  determine.  CORAL may qualify any
section in any report in such manner as CORAL believes appropriate.
           KeySpan  Energy  Trading  agrees  to ensure  the  timely  review  and
execution of KeySpan Energy Trading-Related Transactions. KeySpan Energy Trading
shall  use  reasonable  efforts  to  have  KeySpan  Energy  Trading's  officers,
accountants  and other  advisors  cooperate so that CORAL may have timely access
(at  reasonable and  convenient  times and as KeySpan Energy Trading  reasonably
deems  necessary for the purposes and scope of this Agreement) to KeySpan Energy
Trading's  officers,  accountants and other advisors as reasonably  requested by
CORAL for purposes of this  engagement  within normal  business hours of KeySpan
Energy Trading subject to the  Confidentiality  Agreement referred to in Section
33 hereof. CORAL shall notify KeySpan Energy Trading in




<PAGE>



writing  if  CORAL,  in  its  judgment,  is not  receiving  adequate  or  timely
information  from KeySpan Energy Trading or if CORAL has not had adequate access
to KeySpan Energy Trading's officers, accountants or other advisors.
           KeySpan Energy Trading will timely pay any person or entity rendering
services,  goods or materials to KeySpan Energy Trading in connection  with this
Agreement  and will not allow any  liens to be placed on any CORAL  property  in
connection with nonpayment of any such person or entity.

27.        Support from CORAL

           The Parties  acknowledge  that the  ultimate  success of the Parties'
objectives under this Agreement is dependent upon the amount of support provided
by CORAL personnel hereunder.  CORAL shall provide the services,  training,  and
other  activities  which are  described  in this  Agreement  at its own cost and
expense, subject to Section 13 hereof.
           CORAL  will  assign a  sufficient  number  of staff,  with  requisite
expertise so that CORAL can perform its obligations under this Agreement,  to be
available to KeySpan  Energy  Trading for  assistance and counsel with regard to
KeySpan Energy Trading-Related Transactions and CORAL- Related Transactions, all
at CORAL's  expense,  subject to  Section  13 hereof.  Specifically,  CORAL will
provide  full-time  personnel as mutually  deemed  necessary  at KeySpan  Energy
Trading's  offices and CORAL's  offices to assist  KeySpan Energy Trading in the
origination,   structuring,   and  execution  of  energy-related  and  financial
instrument  transactions.  CORAL will also  provide  sufficient  personnel  with
natural  gas,  fuel oil,  electricity  and  emission  trading  expertise to work
closely with  KeySpan  Energy  Trading's  risk  management  personnel at KeySpan
Energy  Trading's  offices and at CORAL's offices to achieve the stated purposes
of this Agreement. CORAL will also work with KeySpan Energy Trading personnel at
KeySpan Energy Trading's offices, or as necessary at CORAL's offices, to enhance
the knowledge of KeySpan Energy Trading personnel in the origination, structure,
decision making, execution and risk management of CORAL-Related Transactions.
           CORAL  will  perform  its   obligations   hereunder  in  a  diligent,
professional, and workmanlike manner, consistent with industry practice.




<PAGE>



           CORAL will timely pay any person or entity rendering services,  goods
or  materials  to CORAL for use in  performance  of its  obligations  under this
Agreement  and will not allow any liens to be placed on any KeySpan  property in
connection with nonpayment of any such person or entity.
           CORAL shall cause all of its  personnel  involved  in  providing  the
services  contemplated by this Agreement to KeySpan Energy Trading shall observe
and  comply  with  all  of  KeySpan  Energy  Trading's  operating  and  security
requirements  and  procedures  of which they are  advised,  informed,  or become
aware.

28.        Representations

     a.   KeySpan Energy Trading represents and warrants to CORAL that:

          (i)  KeySpan Energy Trading is duly formed,  validly existing,  and in
               good standing under the laws of the  jurisdiction  in which it is
               organized;

          (ii) This Agreement has been duly  authorized,  executed and delivered
               by  KeySpan  Energy  Trading  and  constitutes  a  legal,  valid,
               binding, and enforceable agreement of KeySpan Energy Trading;

          (iii)The person  executing  this Agreement on behalf of KeySpan Energy
               Trading has full power and authority to do so;

          (iv) KeySpan  Energy Trading is not relying on any  representation  of
               CORAL  (written  or  oral)  except  as to  those  representations
               explicitly set forth herein;

          (v)  The execution and delivery of this Agreement and the  performance
               of the obligations under this Agreement by KeySpan Energy Trading
               do not violate any provision of the  documents  pursuant to which
               KeySpan  Energy  Trading is organized  or, to the best of KeySpan
               Energy  Trading's  knowledge,  any contract or other agreement to
               which  KeySpan  Energy  Trading  is a party or by  which  KeySpan
               Energy Trading is bound, or any statute, or any rule, regulation,
               or order of any governmental or regulatory  authority  applicable
               to KeySpan Energy Trading;

          (vi) KeySpan Energy  Trading  presently is unaware of any policies and
               restrictions   that  would  prohibit   KeySpan  Energy  Trading's
               activities as applicable to this




<PAGE>



               Agreement,   including  without   limitation  such  policies  and
               restrictions  as may be imposed by agreement  or  applicable
               laws or regulations;

          (vii)KeySpan  Energy  Trading  is  entering  into  this  Agreement  as
               principal and not as an undisclosed agent for any  non-affiliated
               entity;

          (viii) KeySpan Energy  Trading,  to the best of its  knowledge,  is an
               "eligible swap  participant" as defined in the Regulations of the
               U.S. Commodity Futures Trading Commission, 17 CFR 35.1;

          (ix) KeySpan  Energy  Trading  has  entered  into  this  Agreement  in
               conjunction  with its line of  business or the  financing  of its
               business;

          (x)  KeySpan Energy Trading is acting on its own behalf,  and has made
               its own independent decisions to enter into this Agreement and as
               to whether the activities and obligations  contemplated hereunder
               are  appropriate  for it  based  upon its own  judgment  and upon
               advice from such advisors as it has deemed necessary;

          (xi) KeySpan  Energy  Trading  is not  relying  on  any  communication
               (written or oral) of CORAL as advice or as a  recommendation.  It
               is understood that  information and  explanations  related to the
               terms and  conditions of this  Agreement  shall not be considered
               advice or a  recommendation  to enter into this  Agreement or the
               activities or obligations contemplated hereunder;

          (xii)KeySpan  Energy Trading has not received from CORAL any assurance
               or guarantee as to the expected results of this Agreement and the
               activities  or  obligations  contemplated  hereunder,  except  as
               specifically addressed herein;

          (xiii)  KeySpan   Energy   Trading  is  capable  of   evaluating   and
               understanding   (on  its  own  behalf  or   through   independent
               professional  advice),  and understands  and accepts,  the terms,
               conditions   and  risks  of  the   activities   and   obligations
               contemplated  by  this  Agreement  and  it  is  also  capable  of
               assuming, and assumes, such risks;




<PAGE>



          (xiv)CORAL is not acting as a fiduciary for KeySpan  Energy Trading in
               respect  of  this  Agreement  or the  activities  or  obligations
               contemplated hereunder; and

          (xv) This  Agreement  constitutes  an  arms-length  agreement  between
               KeySpan Energy Trading and CORAL. KeySpan Energy Trading, and the
               representative(s)  of KeySpan Energy Trading acting on its behalf
               in connection with entering into this Agreement,  understand that
               entering into OTC derivative transactions involves special risks,
               including   taxation,   market,   illiquidity,   basis  (location
               differential),  credit risks, and risks of counter-party  default
               or failure of  performance  due to force majeure or other causes.
               However,   it  is  understood  that:  (1)  nothing  herein  shall
               constitute a representation  by KeySpan Energy Trading that CORAL
               has  authority  to enter  into  OTC  derivative  transactions  or
               transactions  on the New  York  Mercantile  Exchange  on  KeySpan
               Energy's  behalf,  and (2)  nothing  herein  shall  constitute  a
               representation  by KeySpan  Energy  Trading that  KeySpan  Energy
               Trading has authority  granted to it by the Board of Directors of
               KeySpan  to  enter  into  any  OTC  derivative   transactions  or
               transactions on the New York Mercantile Exchange.

          b. CORAL represents and warrants to KeySpan Energy Trading that:

               (i)  CORAL is duly formed, validly existing, and in good standing
                    under the laws of the jurisdiction in which it is organized;

               (ii) This  Agreement  has  been  duly  authorized,  executed  and
                    delivered by CORAL and constitutes a legal, valid,  binding,
                    and enforceable agreement of CORAL;

               (iii)The person  executing  this Agreement on behalf of CORAL has
                    full power and authority to do so;

               (iv) The  execution  and  delivery  of  this  Agreement  and  the
                    performance of the obligations under this Agreement by CORAL
                    do not violate any provision of




<PAGE>



               the  documents  pursuant  to  which  CORAL is  organized,  or any
                    contract or other  agreement to which CORAL is a party or by
                    which  CORAL  is  bound,  or  any  statute,   or  any  rule,
                    regulation,  or  order  of any  governmental  or  regulatory
                    authority applicable to CORAL;

               (v)  CORAL  has  expertise  in the  area of risk  management  and
                    trading;

               (vi) CORAL has not  received  from  KeySpan  Energy  Trading  any
                    assurance or  guarantee  as to the expected  results of this
                    Agreement  and the  activities or  obligations  contemplated
                    hereunder;

               (vii)CORAL  will  maintain a staff  sufficient  in number so that
                    CORAL may perform its  obligations to KeySpan Energy Trading
                    in accordance with the terms of this Agreement; and

               (viii) All  persons  rendering  services  to CORAL for use in the
                    performance of its obligations under this Agreement have the
                    requisite  expertise,  knowledge,  and training  relating to
                    matters  which are the  subject  of this  Agreement  so that
                    CORAL may perform its  obligations  in  accordance  with the
                    terms of this Agreement.

           c.  KeySpan  Energy  Trading  agrees to indemnify  and save  harmless
CORAL,  its  partners,  subsidiaries,  employees and agents from and against any
claims or losses,  including any and all expenses,  costs, reasonable attorneys'
fees,  settlements,  judgments  or  awards  incurred  by  CORAL,  its  partners,
subsidiaries,  employees and agents in the defense of any such claims or lawsuit
or  CORAL's  having to return to KeySpan  any  amounts  paid by  KeySpan  Energy
Trading to CORAL  hereunder if (a) the execution and delivery of this  Agreement
and the  performance of the  obligations  under this Agreement by KeySpan Energy
Trading violates any provision of the documents pursuant to which KeySpan Energy
Trading is organized, or any contract or other agreement to which KeySpan Energy
Trading is a party or by which KeySpan Energy Trading is bound,  or any statute,
or any rule,  regulation,  or order of any governmental or regulatory  authority
applicable to KeySpan Energy Trading; or (b) KeySpan Energy Trading has policies
and restrictions that prohibit KeySpan Energy Trading's activities as applicable
to this Agreement, including without limitation such




<PAGE>



policies and  restrictions  as may be imposed by agreement or applicable laws or
regulations.  KeySpan Energy  Trading's  indemnity  obligations in the preceding
sentence are not subject to the  limitation of liability set forth in Section 31
of this  Agreement  which  provides that  liability  shall not exceed the liable
Party's share of net positive margin, if any, from the other Party's Book.

29.        Conflicts Waiver

           KeySpan  Energy Trading and CORAL  acknowledge  and accept that CORAL
and KeySpan Energy Trading,  and persons connected with CORAL and KeySpan Energy
Trading, may have an interest in, or a conflict of duty regarding, a transaction
or matter  which is the  subject  of this  Agreement.  While such  interests  or
conflicts  may or may not be  disclosed  by one  Party  to the  other,  the mere
existence of such  interests or conflicts will not be deemed to affect or impact
CORAL's  or  KeySpan  Energy  Trading's  obligations  hereunder,  to the  extent
described in this Section.
           CORAL and  KeySpan  Energy  Trading  shall not have a duty to refrain
from engaging directly or indirectly in the same or similar business  activities
or  lines  of  business  as  the  energy-related  transactions,  subject  to any
applicable  terms and conditions of exclusivity  set forth in Section 18 of this
Agreement,  and to the fullest extent permitted by applicable law, neither CORAL
nor any of its partners, officers or directors shall be liable to KeySpan Energy
Trading for breach of any  fiduciary  duty by reason of any such  activities  of
CORAL or of such  partners'  participation  therein and neither  KeySpan  Energy
Trading nor any of its officers or directors shall be liable to CORAL for breach
of any fiduciary duty by reason of any such activities of KeySpan Energy Trading
or of such officers' or directors' participation therein.

30.        Transactions and Relationships Outside this Agreement

           KeySpan Energy Trading  acknowledges  and agrees that it engages,  or
may in the future engage, in other dealings with CORAL on an arms-length  basis,
and that any duties which CORAL may owe to KeySpan Energy Trading as a result of
the relationship established and governed by this Agreement do not extend to, or
otherwise affect, such other arms-length relationships.
           KeySpan Energy Trading acknowledges that CORAL may render services to
other clients and institutions with respect to, and CORAL and such other clients
and institutions may enter into,




<PAGE>



hedging,  derivative,  and physical or other transactions which are the same as,
similar  to, or  different  from those which CORAL  contemplates  entering  into
pursuant  to this  Agreement,  and that CORAL shall be in all  respects  free to
carry  on such  activities  as if this  Agreement  did not  exist,  even if such
activities  involve  taking action  inconsistent  with that presented to KeySpan
Energy Trading by CORAL hereunder, provided that whatever CORAL does for a third
party does not impair  CORAL's  obligations to KeySpan Energy Trading under this
Agreement.

31.        Limitation of Liability

           Except as provided in this Agreement,  CORAL makes no representations
or  warranties,  express or implied,  as to the  merchantability,  fitness for a
particular  purpose or otherwise  with respect to its  obligations  set forth in
this Agreement,  any services,  recommendations,  or advice rendered pursuant to
this Agreement, or any energy-related  transaction entered into pursuant to this
Agreement,  and CORAL neither assumes nor authorizes any person to assume for it
any  other  warranty  or  liability  in  connection  with  this  Agreement,  its
obligations  hereunder,  any  services,   recommendations,  or  advice  provided
hereunder,  or any such  energy-related  transaction.  IN NO EVENT SHALL  EITHER
PARTY BE  LIABLE  TO THE  OTHER  PARTY FOR  INCIDENTAL,  INDIRECT,  SPECIAL,  OR
CONSEQUENTIAL DAMAGES, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH
DAMAGES. EXCEPT WITH RESPECT TO LIABILITY ARISING OUT OF OR RESULTING FROM GROSS
NEGLIGENCE,  INTENTIONAL OR WILLFUL MISCONDUCT, OR DISHONEST ACTS, THE LIABILITY
OF EITHER PARTY TO THE OTHER PARTY SHALL NOT EXCEED THE LIABLE  PARTY'S SHARE OF
NET POSITIVE  MARGIN,  IF ANY,  FROM THE OTHER  PARTY'S BOOK  DETERMINED  AT THE
EXPIRATION OR TERMINATION OF THIS AGREEMENT.

           Without  limiting the foregoing in any way,  KeySpan  Energy  Trading
acknowledges that any  mark-to-market  valuations or models that may be provided
to it by CORAL are compilations of assumptions, projections and figures provided
by  KeySpan  Energy  Trading  or others,  and  agrees  that CORAL  shall have no
responsibility to verify the accuracy,  completeness or reasonableness of any of
those  projections  or figures or the  assumptions  provided  by KeySpan  Energy
Trading on which




<PAGE>



the  valuations  and models are based,  provided that CORAL shall be responsible
for accurately  compiling and incorporating  such  assumptions,  projections and
figures in such valuations or models.
           KeySpan Energy Trading  confirms that it will rely exclusively on its
own  counsel,   accountants   and  other  similar  expert  advisors  for  legal,
accounting, tax and other similar expert advice.

32.        Indemnification

           A.        Indemnification by KeySpan Energy Trading

           KeySpan Energy  Trading agrees to indemnify and save harmless  CORAL,
its partners,  subsidiaries,  employees, and agents from and against any claims,
lawsuits or losses, including any and all expenses, costs, reasonable attorneys'
fees,  settlements,  judgments  or  awards  incurred  by  CORAL,  its  partners,
subsidiaries,  employees, and agents in the defense of any such claim or lawsuit
arising  out  of  or  resulting  from  KeySpan  Energy  Trading   following  any
recommendation  made by CORAL with  respect to matters  which are the subject of
this Agreement except if due to or involving the gross  negligence,  intentional
or  willful  misconduct,  or  dishonest  acts of CORAL or any  person  or entity
rendering  services,  goods or materials to CORAL for use in the  performance of
CORAL's  obligations  hereunder,  provided  that  CORAL  has  complied  with the
material provisions of this Agreement,  and further provided that this indemnity
shall not relieve CORAL of its obligations under this Agreement or liability for
damages on account of breach, subject to the terms of Section 31 above.
           KeySpan Energy  Trading agrees to indemnify and save harmless  CORAL,
its partners, subsidiaries, employees, and agents from and against any claims or
losses,  including  any and all expenses,  costs,  reasonable  attorneys'  fees,
settlements,  judgments or awards incurred by CORAL, its partners, subsidiaries,
employees and agents in the defense of any such claim or lawsuit: (i) for injury
to  persons  or  damage  to  property  arising  out  of or  resulting  from  the
negligence,  gross negligence,  intentional or willful misconduct,  or dishonest
acts of  KeySpan  Energy  Trading or any  person or entity  rendering  services,
goods,  or materials to KeySpan Energy Trading for use in the performance of its
obligations  under  this  Agreement,  to the  extent  of the  negligence,  gross
negligence, intentional or willful misconduct, or dishonest acts attributable to
KeySpan Energy




<PAGE>



Trading or any such person or entity rendering services,  goods, or materials to
KeySpan Energy Trading for use in the performance of its obligations  under this
Agreement;  or (ii) which  arise out of a claim or  allegation  by any person or
entity rendering services, goods, or materials to KeySpan Energy Trading for use
in the  performance  of this  Agreement  that  there is an  amount  due for such
services, goods, or materials.
           The indemnity set forth in the second paragraph of this Section 32.A.
shall not be subject to the  limitation  of liability set forth in Section 31 of
this Agreement which provides that liability shall not exceed the liable Party's
share of net positive margin, if any, from the other Party's Book, if and to the
extent  the claim or loss is  covered  by  insurance  as set forth in Section 43
hereof.  Further, if the claim or loss giving rise to the indemnity set forth in
the second  paragraph  of this Section  32.A.  arises out of or results from the
gross  negligence,  intentional  or willful  misconduct,  or  dishonest  acts of
KeySpan Energy Trading or any person or entity  rendering  services,  goods,  or
materials  to  KeySpan  Energy  Trading  for  use  in  the  performance  of  its
obligations  hereunder,  as  provided  in  Section  31 of this  Agreement,  such
indemnity is not subject to the  limitation of liability set forth in Section 31
of this  Agreement  which  provides that  liability  shall not exceed the liable
Party's share of net positive  margin,  if any, from the other Party's Book, and
shall not be  limited  to the  amount  of any  insurance  coverage  set forth in
Section 43 of this Agreement.
           KeySpan Energy Trading shall indemnify and save harmless  CORAL,  its
partners,  subsidiaries,  employees,  and agents from and against any penalties,
fines, or forfeitures imposed by a governmental authority or expenses associated
therewith  (including,  without  limitation,  litigation  costs  and  reasonable
attorneys'  fees)  arising  out of or  resulting  from any failure or refusal by
KeySpan  Energy  Trading  to comply  with any law,  statute,  regulation,  rule,
ordinance,  order,  injunction,  writ,  decree  or  award of any  government  or
political  subdivision thereof, or any agency,  authority,  bureau,  commission,
department  or  instrumentality   thereof,  or  any  court,  applicable  to  the
performance of KeySpan Energy Trading' s obligations under this Agreement.

           B.        Indemnification by CORAL




<PAGE>



           CORAL agrees to indemnify  and save harmless  KeySpan,  its officers,
directors,  employees,  and  agents  from and  against  any  claims,  or losses,
including any and all expenses,  costs,  reasonable attorneys fees, settlements,
judgments or awards incurred by KeySpan, its officers, directors,  employees and
agents in the defense of any such claim or lawsuit: (i) for injury to persons or
damage to  property  arising  out of or  resulting  from the  negligence,  gross
negligence, willful or intentional misconduct, or dishonest acts of CORAL or any
person or entity rendering services, goods, or materials to CORAL for use in the
performance of its obligations hereunder, to the extent of the negligence, gross
negligence, willful or intentional misconduct, or dishonest acts attributable to
CORAL or any such person or entity  rendering  services,  goods, or materials to
CORAL for use in the performance of its obligations  under this Agreement;  (ii)
for any  financial  losses that can be  identified  as resulting  from the gross
negligence, intentional or willful misconduct, or dishonest acts of CORAL or any
person or entity rendering services,  goods or materials to CORAL for use in the
performance of CORAL's  obligations  hereunder in connection with KeySpan Energy
Trading's  following  any  recommendation  made or  advice  given by CORAL  with
respect to matters which are the subject of this Agreement; or (iii) which arise
out of a claim or allegation by any person or entity rendering services,  goods,
or materials to CORAL for use in the  performance of its  obligations  hereunder
that there is an amount due for such services, goods, or materials.
           The indemnity set forth in the first  paragraph of this Section 32.B.
shall not be subject to the  limitation  of liability set forth in Section 31 of
this Agreement which provides that liability shall not exceed the liable Party's
share of net positive margin, if any, from the other Party's Book, if and to the
extent  the claim or loss is  covered  by  insurance  as set forth in Section 43
hereof.  Further, if the claim or loss giving rise to the indemnity set forth in
the first  paragraph  of this  Section  32.B.  arises out of or results from the
gross negligence,  intentional or willful misconduct, or dishonest acts of CORAL
or any person or entity rendering services, goods, or materials to CORAL for use
in the  performance of its obligations  hereunder,  as provided in Section 31 of
this Agreement, such indemnity is not subject to the limitation of liability set
forth in Section 31 of this Agreement  which  provides that liability  shall not
exceed the liable Party's share of net positive margin, if any, from




<PAGE>



the other Party's Book,  and shall not be limited to the amount of any insurance
coverage set forth in Section 43 of this Agreement.
           CORAL  shall  indemnify  and save  harmless  KeySpan,  its  officers,
directors,  employees,  and agents  from and against any  penalties,  fines,  or
forfeitures imposed by a governmental authority or expenses associated therewith
(including, without limitation, litigation costs and reasonable attorneys' fees)
arising out of or resulting  from any failure or refusal by CORAL to comply with
any law, statute,  regulation,  rule, ordinance, order, injunction, writ, decree
or award of any  government  or political  subdivision  thereof,  or any agency,
authority,  bureau,  commission,  department or instrumentality  thereof, or any
court,   applicable  to  the  performance  of  CORAL's  obligations  under  this
Agreement.

33.        Confidentiality

     At the execution of this Agreement,  CORAL and KeySpan Energy shall execute
a  Confidentiality  Agreement  which sets forth the terms upon which the Parties
must treat confidential information provided or disclosed to each other pursuant
to this  Agreement.  The  Confidentiality  Agreement is hereby  incorporated  by
reference and copies are annexed as Appendix A.

34.        Notices and Communications

           Any   notice,   consent,   authorization,   determination   or  other
communication  required or permitted to be given or made  hereunder  shall be in
writing and shall be sufficiently given or made if:

          (a)  mailed by U.S.  certified or registered  mail,  postage  prepaid,
               return- receipt requested; or

          (b)  telecopied to the  facsimile  number set forth below and followed
               by a copy delivered in accordance with Section 34(a) or 34(c); or

          (c)  delivered by nationally  recognized express or overnight courier;
               and

           If to KeySpan Energy Trading addressed to it at:
           ------------------------------------------------

                     KeySpan Energy Trading Services LLC
                     100 East Old Country Road




<PAGE>



                     Hicksville, New York 11801
                     Attn:     Mr. Charles A. Daverio
                               President
                     Fax:      (516) 545-5467

           If to CORAL addressed to it at:
           ------------------------------

                     CORAL Energy, L.P.
                     909 Fannin Street - Suite 700
                     Houston, Texas 77010
                     Attn:     Ms. Linda Downs
                               Vice President
                     Fax:      (713) 265-5475

     Notices shall be deemed effective when received.  Each Party may change its
address and  facsimile  number for  purposes of this Section 34 by notice to the
other Party pursuant hereto.

35.        Miscellaneous

           Except as  expressly  otherwise  provided  in Section 33 above,  this
Agreement  constitutes the entire agreement  between the Parties with respect to
the matters  addressed  herein,  supersedes all prior  letters,  correspondence,
conversations, agreements, understandings, and negotiations or discussions, both
written and oral,  express or  implied,  between  the  Parties  with  respect to
matters addressed herein and cannot be amended or otherwise modified orally, but
only by a written instrument executed by the Parties setting forth such changes.
No Party may transfer or assign any rights or obligations  hereunder (whether by
merger,  conversion,  liquidation,  operation of law, or otherwise)  without the
prior written consent of the other Party. This Agreement shall be binding on the
Parties' successors (whether by merger,  conversion,  liquidation,  operation of
law, or otherwise) and permitted assigns.
           To the extent there is an extraordinary corporate transaction such as
a merger,  consolidation,  sale of  assets,  or  similar  transaction  involving
KeySpan,  KeySpan Energy Trading or some other entity  affiliated with either of
the foregoing  during the Term, the Parties agree to discuss any changes to this
Agreement  that may be  necessary,  including  but not limited to,  changing the
scope,  sharing  provisions  and the CORAL  guaranty and costs to render service
hereunder. To the extent there is




<PAGE>



an extraordinary corporate transaction such as a merger, consolidation,  sale of
assets, or similar  transaction  involving CORAL or some other entity affiliated
with either of the  foregoing  during the Term,  the CORAL's  successor  remains
bound to all of CORAL's obligations hereunder.

36.        Governing Law and Jurisdiction

     The Agreement will be governed by and construed in accordance with the laws
of the State of New York  without  regard to the  conflicts  of laws  provisions
thereof.

37.        Other Services

           Nothing in this  Agreement  is intended to obligate or commit  either
Party to purchase any services  from,  enter into any further  agreements  with,
provide any financing to,  purchase any securities  from, or enter into any cap,
swap or other derivative or hedging transaction with, the other Party, except as
specifically provided herein.
           Nothing in this Agreement shall be construed giving either express or
implied  authority to CORAL or any person or entity to represent  KeySpan Energy
Trading in any transaction with any person or entity for any purpose,  except as
granted consistent with the scope of this Agreement as described in Section 2.

38.        Affiliate Services

           KeySpan  Energy Trading  acknowledges  and  understands  that CORAL's
obligations  hereunder  may be  performed  by CORAL  personnel,  or  independent
contractors of CORAL.  CORAL will remain  responsible for the performance of its
obligations hereunder, regardless whether its obligations are performed directly
by CORAL personnel or by contractors,  and KeySpan Energy Trading agrees to look
solely to CORAL for such  performance.  Subject to the terms of this  Agreement,
including,   without  limitation,   the  confidentiality   requirements  of  the
Confidentiality  Agreement  and  Section  33  above,  CORAL may (i)  employ  the
services  of agents  or  contractors,  (ii)  share  any  information  (including
non-public  information)  with such agents or contractors  and receive from such
agents or contractors any relevant information, and (iii) staff the project with
such employees of itself and its agents or  contractors as it deems  appropriate
(and remove any such  employees  from the  project as it shall deem  appropriate
from  time  to  time).  Subject  to  the  confidentiality  requirements  of  the
Confidentiality Agreement and Section 33 above, KeySpan




<PAGE>



Energy  Trading  acknowledges  that the  employees  of CORAL  and its  agents or
contractors  who staff the  project  may  rotate  in and out of the  project  as
needed. CORAL will not make substitutions of team members without the consent of
KeySpan Energy Trading which consent will not be unreasonably withheld.

39.        Sole Engagement

           KeySpan Energy Trading  recognizes  that CORAL has been retained only
for the purposes set forth in this Agreement,  and that such engagement of CORAL
hereunder is not deemed to be on behalf of and is not intended to confer  rights
individually  upon any corporate  member of KeySpan  Energy Trading or any other
person as against CORAL. Unless otherwise expressly agreed by the Parties,  only
KeySpan  Energy  Trading  is  authorized  to rely  upon  the  services  of CORAL
hereunder,  the  deliverables or products  hereof,  or any statements,  reports,
advice, opinions or conduct by CORAL.

40.        Force Majeure

           If either  Party is  rendered  unable,  wholly  or in part,  by force
majeure to carry out its  obligations  (other than  payment and other  financial
obligations)  under this  Agreement,  it is agreed that the  obligations  of the
Parties,  insofar as they are affected by such force majeure, shall be suspended
during the continuance of any inability so caused,  but for no longer period. As
used herein,  "force majeure" means any cause not reasonably  within the control
of the Party  claiming  suspension by reason of force majeure and which,  by the
exercise of due diligence, such Party was unable to prevent or overcome.
           If CORAL  declares  force majeure  hereunder,  and such force majeure
event lasts  longer  than thirty (30)  consecutive  days,  then  KeySpan  Energy
Trading may  terminate  this  Agreement  by  providing  written  notice to CORAL
pursuant to the provisions of Section 24 hereof.

     If KeySpan Energy Trading declares force majeure hereunder,  and such force
majeure  event lasts longer than thirty (30)  consecutive  days,  then CORAL may
terminate this  Agreement by providing  written notice to KeySpan Energy Trading
pursuant to the provisions of Section 24 hereof.

41.        Severability




<PAGE>



           Whenever  possible,   each  provision  of  this  Agreement  shall  be
interpreted  in such manner as to be effective and valid under  applicable  law.
Any  provision  of this  Agreement  that is  invalid or  unenforceable  shall be
ineffective  to the  extent  of  such  invalidity  or  unenforceability  without
invalidating or rendering unenforceable the remaining provisions hereof, and any
such invalidity or unenforceability shall not invalidate or render unenforceable
the remaining provisions hereof. 42. Use of Name
           CORAL will not use KeySpan's name or any abbreviation thereof for any
advertising,  promotions,  trade displays or other  commercial  purposes without
prior  written  consent of KeySpan  nor shall  CORAL use  KeySpan's  logo or any
adaptation thereof for any such purposes without such consent.

43.        Insurance
           A.        CORAL Insurance
                     (i)       Coverage

                               CORAL  (and  all its  subcontractors)  shall,  at
                     their own  expense,  procure  and  maintain  the  following
                     minimum  insurance  in forms and with  reputable  insurance
                     companies:

                               Workers' Compensation  Insurance covering CORAL's
                     (and its  subcontractors')  employees  in  accordance  with
                     statutory  requirements and Employer's  Liability Insurance
                     with a minimum limit of $1,000,000 each occurrence.

                               Commercial General Liability  Insurance including
                     Personal   Injury,   Contractual,    Contingent,   Products
                     Liability,  Independent  Contractors,  Broad Form  Property
                     Damages and coverage,  with the following minimum limits of
                     liability:
                                 $1,000,000 per occurrence Combined Single Limit
                                 $2,000,000 General aggregate

                         Umbrella  Liability.  A following form umbrella  policy
                    shall be in force  with  Commercial  General  Liability  and
                    Employer's Liability policies scheduled:




<PAGE>



                         Limits required:  $3,000,000 per occurrence/aggregate

                     (ii)      Insurance Notification

                     Within  ninety  (90)  days  of the  effective  date of this
           Agreement,  CORAL shall  deliver a Certificate  of Insurance  showing
           that the insurance  outlined above is in force and that not less than
           fifteen  (15) days  notice  will be given to KeySpan  Energy  Trading
           prior to  cancellation,  termination  or material  alteration of said
           insurance.  KeySpan  Corporation and its affiliates shall be named as
           an  additional  insured  on such  certificates.  The  Certificate  of
           Insurance  should be delivered to KeySpan  Corporation,  175 East Old
           Country Road, Hicksville, New York 11801; Attention: Risk Management;
           Telephone No. (516) 545-5166.

                     (iii)     Insurance No Limit

                     The  insurance  requirements  as set  forth  are  to  fully
           protect  KeySpan  Energy  Trading  from any and all  claims  by third
           parties,  including  employees  of CORAL or its agents,  contractors,
           subcontractors,  and invitees. Said insurance,  however, in no manner
           relieves or releases CORAL, its agents, contractors,  subcontractors,
           or  invitees  from,  or  limits  their  liability  as to any  and all
           obligations herein assumed.  If such insurance is available only on a
           claims-made  basis,  then  the  dates  of  coverage   (including  the
           retroactive  date) and the time period  within which any claim can be
           filed will be so stated on the  Certificate  of  Insurance  and CORAL
           shall not permit any gaps in  coverage to occur.  CORAL shall  notify
           KeySpan  Energy  Trading in writing of all claims arising out of this
           Agreement within twenty-four (24) hours after the occurrence thereof.
           Such notice  shall not  relieve  any Party of any of its  obligations
           under  this  Agreement,  nor be  construed  to be  other  than a mere
           notification.

                     (iv)      Option to Self Insure

                     CORAL and/or its subcontractors  may, at their option, self
           insure all or part of their  required  coverage  and  limits.  In the
           event that CORAL decides to exercise this option,  CORAL will provide
           KeySpan  Energy  Trading with a letter  stating that CORAL and/or its
           subcontractors are/is exercising such option.

                     (v)       Subcontractor Compliance




<PAGE>



          CORAL shall ensure that all of its  subcontractors  are in  compliance
     with these insurance provisions at all times.

           B.        KeySpan Energy Trading Insurance

     KeySpan  Energy  Trading shall provide  reciprocal  insurance  coverage and
limits while KeySpan Energy Trading's employees are in training on CORAL's site.
KeySpan  Energy  Trading  may,  at its  option,  self insure all or part of said
coverage  and  limits.  In the event  that  KeySpan  Energy  Trading  decides to
exercise this option,  KeySpan  Energy  Trading will provide CORAL with a letter
stating that the option is being exercised.

44.        Section Headings

     Section  headings  herein are for  convenience  only and shall not limit or
modify the provisions hereof.

45.        Waiver

           The  failure  of either  Party to  object  to or to take  affirmative
action with  respect to any conduct of the other Party which is in  violation of
the terms of this Agreement  shall not be construed as a waiver  thereof,  or of
any future breach or subsequent  wrongful conduct. No waiver of any of the terms
of this  Agreement  shall be valid  unless it is in writing and is signed by the
Party against whom such waiver is asserted.

46.        No Relationship Created

           No agency, partnership,  joint venture or other joint relationship is
created by this Agreement.

47.        Survival of Obligations

           Those provisions  which by their nature would survive  termination or
expiration of this Agreement and which will enable the Parties to exercise their
rights and fulfill their  obligations  under this Agreement  including,  without
limitation,  the  obligations  set forth in Sections 17,  28(c),  31, 32 and 33,
shall survive termination or expiration of this Agreement.


           IN WITNESS HEREOF, the Parties have executed this Agreement as of the
date first herein written.




<PAGE>



CORAL ENERGY HOLDING, L.P.                   KEYSPAN ENERGY TRADING SERVICES LLC

By:        _______________________           By:     ___________________________

Name:      _______________________           Name:   ___________________________

Title:     _______________________           Title:  ___________________________


                         GUARANTY BY KEYSPAN CORPORATION
                         -------------------------------

           The  undersigned  hereby  guarantees  performance  by KeySpan  Energy
Trading Services LLC of its obligations under the foregoing Agreement.

KEYSPAN CORPORATION

By:        ______________________

Name:      ______________________

Title:     ______________________

Date:      ______________________