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                              AMENDATORY AGREEMENT NO. 5

                                         TO

                 AGREEMENT FOR THE SALE AND PURCHASE OF NATURAL GAS
                                      between
                         CHUGACH ELECTRIC ASSOCIATION, INC.
                                        AND
                              MARATHON OIL COMPANY

                              dated September 26, 1988


         WHEREAS,  Chugach Electric  Association,  Inc.  (Chugach) and Marathon
Oil Company  (Marathon) entered into an Agreement for the Sale and Purchase of
Natural Gas (Agreement) dated September 26, 1988;
         WHEREAS, the Agreement has heretofore been amended four times; and
         WHEREAS, Chugach and Marathon desire to modify further the Agreement
for the benefit of both parties;
         NOW,  THEREFORE,  in consideration of the promises and mutual
agreements herein contained,  the parties do covenant and agree as follows:

         Section A. The  definition of Bernice  Lake Power Plant in Section
14(h) of the Agreement  shall include but not be limited to Chugachs portion of
 the capability and output of the Nikiski  cogeneration  facility,  which
facility  consists  in part of a forty  megawatt  (40 MW)  gas-fired  generating
  unit  owned  by  Alaska  Electric Generation & Transmission,  Inc.  (AEG&T)
and located on the east side of Cook Inlet,  Alaska near Nikiski on the
Kenai Peninsula.

         Section B. If and to the extent that  Marathon  supplies gas to Chugach
from the Swanson  River Field for use by Chugach as fuel for Chugachs  portion
of the  capability  and output of the Nikiski  cogeneration  facility owned by
AEG&T,  then the Agreement  shall be modified in the  following  respects for
any such Swanson River Field gas:
                  (1) For  purposes  of  Section  7(b) of the  Agreement  and
         Section  2(b)(5) of Exhibit F of the Agreement,  the upper  limit of
         the  acceptable  range for the  heating  value of Swanson  River Field
         gas shall be 1090 (rather than 1050) Btu per cubic foot,  expressed at
         14.65 pounds per square inch  absolute, 60 degrees Fahrenheit
         (dry basis).
                  (2)  Section 3 (Gas  Quality)  of Exhibit F of the
         Agreement  shall be modified as follows for
         Swanson  River  Field gas:  As a  non-operator  of the  Swanson  River
         Field and gas  storage  reservoir, Marathon  can not  guarantee  the
         quality of the gas  delivered to Chugach  from this  location.
         However, Marathon  will endeavor to provide  Chugach on a monthly
         basis with an analysis  provided by the Operator of the Swanson River
         gas field and storage reservoir.
                  (3) Section 3 (Gas  Pressure)  of Exhibit F of the  Agreement
         shall be modified as follows for Swanson  River Field gas:  Gas shall
         be  delivered  to Chugach at a pressure of not less than four hundred
         (400)  pounds per square inch gauge and not more than one  thousand
         (1000)  pounds per square inch gauge. Gas shall be  delivered  to
         UNOCALs  facility at a pressure  within this stated  range or at the
         pressure required at the inlet of the UNOCAL facility.

         Section  C.  Chugach  and  Marathon  recognize  the  possibility  that
the  steam  output  of the  Nikiski cogeneration  facility may, in some
circumstances,  cease being used as process steam in the production of ammonia
and may instead be harnessed for the  production of electric  power.  Chugach
and Marathon also  recognize  that if this occurs,  and if Chugach (rather than
some other entity)  obtains such  steam-generated  electric  power,  then
such  steam-generated  electric power will in effect displace  electric power
that Chugach would otherwise  produce by operating  Chugachs  gas-fired
generators at Beluga.  As a result of its existing  contractual  obligations to
the Beluga River Field Producers,  Chugach has offered to the Beluga River Field
 Producers gas contract  amendments under which, in such  circumstances,  each
individual Beluga River Field Producer could elect to increase its sales
of gas to Chugach at Beluga in order to offset the  reduction  in such  sales
that  would  otherwise  result  from Chugach  obtaining such  steam-generated
electric  power. If and to the extent that any or all of the Beluga River
Field Producers  accept(s) such contract  amendments  and, in the  circumstances
  contemplated by such  amendments, such  Producer(s)  does/do  in fact elect to
 so  increase  its/their  sales of gas to  Chugach at Beluga,  then (1)
Chugachs  purchases of gas from  Marathon at Beluga will be reduced by the
total amount of such  increased  sales, and (2) Chugach  will  continue to
purchase  from  Marathon all the gas used as fuel for  Chugachs  portion of the
capability and output of the Nikiski cogeneration facility.

         Section D. Chugach will not, without  Marathons  advance written
consent,  exercise its option granted by AEG&T to obtain from  steam-powered
generation  at the Nikiski  cogeneration  facility more energy than that which
can reasonably be produced by a 12 megawatt steam-powered  generator;  provided,
 that if Chugach demonstrates that, in  the  circumstances  then  existing  and
 expected,  Chugach  can  obtain  more  than  12  megawatts  from  such
steam-powered  generation  without  reducing  Marathons  net  sales of gas to
Chugach,  then  Marathon  shall not unreasonably withhold such consent.

         Section  E. For  purposes  of  Section D,  above,  Chugach  shall
determine  the effect of  steam-powered generation at the Nikiski  cogeneration
 facility upon Marathons net sales of gas to Chugach, as follows:  Chugach
shall  notify  Marathon  if  Chugach  desires  to obtain  more  energy  from
such  generation  than that  which can reasonably  be produced by a 12 megawatt
 steam-powered  generator.  The notice shall  further  state (1) the total
volume of gas  delivered to Chugach by Marathon  under the Agreement  during the
 twelve (12) full  calendar  months ended April 30, 1999, as reflected in
Marathons  invoices for those months  (Base Gas);  (2) Chugachs  estimate
for Marathons Share of Chugachs Total Gas  Requirements  under the Agreement
during the twelve (12) full calendar months  beginning  the first day of the
month after  Chugachs  notice,  assuming  that Chugach were to obtain more
energy during such period from steam-powered  generation at the Nikiski
cogeneration  facility than that which can reasonably be produced by a 12
megawatt  steam-powered  generator  (Estimated  Gas);  and (3) Chugachs basis
for the  calculations  and  estimates  in the  notice.  If the  Estimated  Gas
minus the Base Gas is zero or a positive number, then Marathon shall not
unreasonably withhold its consent as provided in Section D, above.

         Section F.  This Amendment will become effective upon approval by the
Alaska Public Utilities Commission.

         Section G. Except for the foregoing  amendments,  all other terms and
conditions of the Agreement  remain in full force and effect.

         IN WITNESS WHEREOF, Chugach and Marathon have caused this

Amendatory Agreement No. 5 to be executed by their authorized representatives.


Chugach Electric Association, Inc.          Marathon Oil Company


By: /s/Eugene N. Bjornstad                  By: /s/ R.G. Becker
Its:  General Manager                       Its: Vice President
Date:  May 19, 1999                         Date:May 24, 1999