UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                    WASHINGTON, D. C.  20549
                            FORM 10-Q

(Mark One)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
     SECURITIES  EXCHANGE ACT OF 1934
     For the quarterly period ended June 30, 1998

                               OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
     SECURITIES EXCHANGE ACT OF 1934
     For the transition period from __________ to ___________
     Commission file number 1-4169

               TEXAS GAS TRANSMISSION CORPORATION
     (Exact name of registrant as specified in its charter)

           Delaware                        61-0405152
     (State or other jurisdiction of     (I.R.S. Employer
     incorporation or organization)     Identification No.)


      3800 Frederica Street, Owensboro, Kentucky         42301
       (Address of principal executive offices)        (Zip Code)

  Registrant's telephone number, including area code: (502) 926-8686


Indicate  by check mark whether the registrant (1) has filed  all
reports  required  to be filed by Section  13  or  15(d)  of  the
Securities  Exchange Act of 1934 during the preceding  12  months
(or  for such shorter period that the registrant was required  to
file  such  reports),  and (2) has been subject  to  such  filing
requirements for the past 90 days.  Yes  X    No_

Indicate the number of shares outstanding of each of the issuer's
classes  of  common  stock,  as of the latest  practicable  date.
1,000 shares as of August 10, 1998

REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS
H(1)(a)  and (b) OF FORM 10-Q AND IS THEREFORE FILING  THIS  FORM
WITH THE REDUCED DISCLOSURE FORMAT.
<PAGE>
        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY

                        TABLE OF CONTENTS



                                                                   Page

                 Part I.  Financial Information

Item 1.  Financial Statements

     Consolidated Balance Sheets - Assets........................      3

     Consolidated Balance Sheets - Liabilities and Stockholder's
       Equity....................................................      4

     Consolidated Statements of Income...........................  5 - 6

     Consolidated Statements of Cash Flows.......................      7

     Condensed Notes to Consolidated Financial Statements........      8

Item 2.  Management's Narrative Analysis of the Results of
           Operations............................................     12
                                
                                
                   Part II.  Other Information

Item 6.  Exhibits and Reports on Form 8-K........................     15

Signature........................................................     16






Certain  matters  discussed in this report, excluding  historical
information, include forward-looking statements.  Although  Texas
Gas   Transmission  Corporation  believes  such   forward-looking
statements are based on reasonable assumptions, no assurance  can
be  given that every objective will be achieved.  Such statements
are  made  in reliance on the "safe harbor" protections  provided
under  the  Private  Securities Reform Act of  1995.   Additional
information about issues that could lead to material  changes  in
performance  is contained in Texas Gas Transmission Corporation's
Annual Report on Form 10-K and 1998 First Quarter Report on  Form
10-Q.
<PAGE>

Item 1.   Financial Statements

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                   CONSOLIDATED BALANCE SHEETS
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                           June 30,       December 31,
                    ASSETS                   1998            1997
<S>                                       <C>             <C>
Current Assets:
 Cash and temporary cash investments       $      229      $      235
 Receivables:
   Trade                                        2,240           2,937
   Affiliates                                     452             284
   Other                                          672           1,945
 Transportation and exchange receivable         8,116           1,890
 Advances to affiliates                        88,721          93,500
 Inventories                                   14,998          15,531
 Deferred income taxes                         14,934          18,179
 Costs recoverable from customers              12,365          16,311
 Gas stored underground                        10,409          11,115
 Other                                          1,153           1,690
   Total current assets                       154,289         163,617

Investments, at cost                            1,006           1,224

Property, Plant and Equipment, at cost:
 Natural gas transmission plant             1,041,176       1,022,654
 Less -- Accumulated depreciation and
   amortization                               112,234          98,649
    Property, plant and equipment, net        928,942         924,005

Other Assets:
 Gas stored underground                        96,695          97,984
 Costs recoverable from customers              49,084          45,504
 Other                                         27,192          24,809
   Total other assets                         172,971         168,297

   Total Assets                            $1,257,208      $1,257,143
</TABLE>                                
                                
                                
                                                               
     The accompanying condensed notes are an integral part of these
                   consolidated financial statements.

<PAGE>
        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                   CONSOLIDATED BALANCE SHEETS
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                
                                             June 30,      December 31,
LIABILITIES AND STOCKHOLDER'S EQUITY           1998           1997
<S>                                        <C>            <C>
Current Liabilities:
 Payables:
   Trade                                    $    4,876     $    2,558
   Affiliates                                   16,323         11,939
   Other                                         4,609          8,302
 Gas Payables:
   Transportation and exchange                   7,771          1,173
   Storage                                       6,322         13,343
 Accrued taxes                                  24,501         21,776
 Accrued interest                                6,557          6,557
 Other accrued liabilities                      40,557         51,517
 Reserve for regulatory and rate matters        19,351         11,319
   Total current liabilities                   130,867        128,484

Long-Term Debt                                 251,300        251,433

Other Liabilities and Deferred Credits:
 Deferred income taxes                         152,575        150,113
 Postretirement benefits other than pensions    38,844         35,683
 Other                                          50,920         49,040
   Total other liabilities and deferred
     credits                                   242,339        234,836

Contingent Liabilities and Commitments            -              -

Stockholder's Equity:
 Common stock, $1.00 par value, 1,000 shares
   authorized, issued and outstanding                1              1
 Premium on capital stock and other paid-in
   capital                                     632,046        636,046
 Retained earnings                                 655          6,343
   Total stockholder's equity                  632,702        642,390

   Total Liabilities and Stockholder's
     Equity                                 $1,257,208     $1,257,143

</TABLE>



 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                CONSOLIDATED STATEMENTS OF INCOME
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                          Three Months Ended June 30,
                                              1998           1997
<S>                                        <C>            <C>
Operating Revenues:
 Gas transportation                         $ 55,367       $ 59,873
 Gas sales                                     4,210          3,643
 Other                                           794             99
   Total operating revenues                   60,371         63,615

Operating Costs and Expenses:
 Cost of gas transportation                    4,366          9,297
 Cost of gas sold                              4,180          3,732
 Operation and maintenance                    16,262         15,362
 Administrative and general                   11,523         13,153
 Depreciation and amortization                10,755         10,669
 Taxes other than income taxes                 3,529          3,630
   Total operating costs and expenses         50,615         55,843

Operating Income                               9,756          7,772

Other (Income) Deductions:
 Interest expense                              5,283          5,009
 Interest income                              (1,513)        (2,268)
 Miscellaneous other income                      (28)          (107)
   Total other deductions                      3,742          2,634

Income Before Income Taxes                     6,014          5,138

Provision for Income Taxes                     2,389          2,048

Net Income                                   $ 3,625       $  3,090

</TABLE>                                
                                                                
                                
                                
                                
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>
        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
                                
                CONSOLIDATED STATEMENTS OF INCOME
                     (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>
                                             Six Months Ended June 30,
                                               1998          1997
<S>                                         <C>           <C>
Operating Revenues:
 Gas transportation                          $ 142,408     $ 156,263
 Gas sales                                       8,388        14,363
 Other                                           1,364           928
   Total operating revenues                    152,160       171,554

Operating Costs and Expenses:
 Cost of gas transportation                     10,441        19,756
 Cost of gas sold                                8,277        14,521
 Operation and maintenance                      28,277        29,695
 Administrative and general                     24,631        28,367
 Depreciation and amortization                  21,284        21,187
 Taxes other than income taxes                   7,665         7,821
   Total operating costs and expenses          100,575       121,347

Operating Income                                51,585        50,207

Other (Income) Deductions:
 Interest expense                               10,579        10,024
 Interest income                                (2,860)       (4,627)
 Miscellaneous other deductions (income)           184          (168)
   Total other deductions                        7,903         5,229

Income Before Income Taxes                      43,682        44,978

Provision for Income Taxes                      17,370        17,898

Net Income                                   $  26,312     $  27,080

</TABLE>                                
                                
                                
                                
                                
                                
                                
                                
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
              CONSOLIDATED STATEMENTS OF CASH FLOWS
                      (Thousands of Dollars)
                           (Unaudited)
<TABLE>
<CAPTION>

                                                 Six Months Ended June 30,
                                                   1998           1997
<S>                                             <C>             <C>
OPERATING ACTIVITIES:
 Net income                                      $ 26,312        $ 27,080
 Adjustments to reconcile to cash provided
  from operations:
   Depreciation and amortization                   21,284          21,187
   Provision for deferred income taxes              5,709            (412)
   Changes in receivables sold                    (14,500)         (8,500)
   Changes in receivables                          10,243          14,386
   Changes in inventories                             533          (1,699)
   Changes in other current assets                   (326)         13,118
   Changes in accounts payable                     (5,138)         (5,197)
   Changes in accrued liabilities                   7,539           5,584
   Other, including changes in noncurrent assets
     and liabilities                                5,373         (20,591)
       Net cash provided by operating activities   57,029          44,956

FINANCING ACTIVITIES:
  Dividends and returns of capital                (36,000)        (50,684)
       Net cash (used in) financing activities    (36,000)        (50,684)

INVESTING ACTIVITIES:
 Property, plant and equipment:
   Capital expenditures, net of AFUDC             (26,508)        (31,091)
   Proceeds from sales and salvage values,
      net of costs of removal                         460              68
 Advances to affiliates, net                        4,779          37,108
 Proceeds from sale of long-term investments          234              37
       Net cash (used in) provided by investing
         activities                               (21,035)          6,122

(Decrease) increase in cash and cash equivalents       (6)            394

Cash and cash equivalents at beginning of period      235             115

Cash and cash equivalents at end of period       $    229        $    509
                                
                                
</TABLE>                                                              
                                
 The accompanying condensed notes are an integral part of these
               consolidated financial statements.
<PAGE>

        TEXAS GAS TRANSMISSION CORPORATION AND SUBSIDIARY
      CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                           (Unaudited)
                                

A.  Corporate Structure and Control, Nature of Operations and
      Basis of Presentation

 Corporate Structure and Control

    Texas  Gas  Transmission Corporation  and  its  wholly  owned
subsidiary, TGT Enterprises, Inc., (collectively, the Company) is
wholly  owned by Williams Gas Pipeline Company, formerly Williams
Interstate  Natural Gas Systems, Inc., which is  a  wholly  owned
subsidiary of The Williams Companies, Inc. (Williams).  Prior  to
May  1,  1997,  the  Company  was a wholly  owned  subsidiary  of
Williams.

 Seasonal Variation

    Operating income may vary by quarter.  Based on current  rate
structure, the Company experiences higher operating income in the
first  and  fourth quarters as compared to the second  and  third
quarters.

  Basis of Presentation

    The consolidated financial statements have been prepared from
the  books and records of the Company without audit, pursuant  to
the   rules  and  regulations  of  the  Securities  and  Exchange
Commission.    Certain   information  and  footnote   disclosures
normally  included in consolidated financial statements  prepared
in  accordance with generally accepted accounting principles have
been   condensed   or   omitted.   The   accompanying   unaudited
consolidated  financial statements include all adjustments,  both
normal  recurring  and  others, which,  in  the  opinion  of  the
Company's  management,  are  necessary  to  present  fairly   its
financial  position  at  June 30, 1998  and  December  31,  1997;
results  of  operations and cash flows for the six  months  ended
June  30, 1998 and 1997; and results of operations for the  three
months   ended  June  30,  1998  and  1997.   These  consolidated
financial  statements  should be read  in  conjunction  with  the
financial  statements,  notes thereto and management's  narrative
analysis contained in the Company's 1997 Annual Report on Form 10-
K and the Company's 1998 First Quarter Report on 10-Q.

   Certain reclassifications have been made in the 1997 financial
statements to conform to the 1998 presentation.

B.  Contingent Liabilities and Commitments

  Regulatory and Rate Matters and Related Litigation

   FERC Order 636

    Effective  November  1,  1993, the Company  restructured  its
business to implement the provisions of Federal Energy Regulatory
<PAGE>
Commission (FERC) Order 636, which, among other things,  required
pipelines   to   unbundle   their  merchant   role   from   their
transportation  services.  FERC  Order  636  also  provides  that
pipelines  should  be  allowed the  opportunity  to  recover  all
prudently  incurred transition costs which, for the Company,  are
primarily  related  to  gas supply realignment  (GSR)  costs  and
unrecovered purchased gas costs. Certain aspects of the Company's
FERC Order 636 restructuring are under appeal.

    In  July  1996,  the United States Court of Appeals  for  the
District  of Columbia issued an order which in part affirmed  and
in  part  remanded FERC Order 636.  On February  27,  1997,  FERC
issued  Order  636-C in response to the court's remand  affirming
that  pipelines may recover all of their GSR costs, but requiring
pipelines to individually propose the percentage of such costs to
be allocated to interruptible transportation services, instead of
a  uniform  10 percent allocation. The Company's GSR  settlement,
discussed  below,  is  not  subject  to  appeal  and  should   be
unaffected  by this Order.  The Order also prospectively  relaxed
the  eligibility requirements for receiving no-notice service and
reduced the right of first refusal matching period from 20  years
to  five  years.  Certain aspects of FERC Order 636-C are subject
to appeal.

    In  September 1995, the Company received FERC approval  of  a
settlement  agreement  which resolves all  issues  regarding  the
Company's  recovery of GSR costs.  The settlement  provides  that
the  Company will recover 100 percent of its GSR costs up to  $50
million, will share in costs incurred between $50 million and $80
million  and will absorb any GSR costs above $80 million.   Under
the settlement, all challenges to these costs, on the grounds  of
imprudence  or  otherwise,  will  be  withdrawn  and  no   future
challenges  will be filed.  Ninety percent of the cost   recovery
is  collected  through demand  surcharges  on the Company's  firm
transportation  rates;  the  remaining  10  percent   should   be
recovered   from   its   interruptible  transportation   service.
Effective  July 1, 1997, the FERC allowed the Company to  suspend
its GSR surcharge applicable to firm transportation (FT) services
due  to the full recovery of incurred GSR costs allocated to firm
services.   The  GSR cost increment included in the interruptible
transportation rates, as well as no-notice and FT overrun  rates,
remains  in effect.  To date, the Company has paid $76.2  million
and  collected $66.1 million, plus interest, related to GSR.  The
Company  expects to pay less than $80 million for its  total  GSR
costs,  primarily as a result of contract terminations,  and  has
provided  reserves for the remaining GSR costs it may be required
to  pay,  as well as a regulatory asset for the estimated  future
amounts recoverable.

   General Rate Issues

    On  April  30,  1997, the Company filed a general  rate  case
(Docket  No.  RP97-344) effective November 1,  1997,  subject  to
refund.   This  rate  case  reflects a requested  annual  revenue
increase  of  approximately $70.9 million, based on filed  rates,
primarily  attributable to increases in the  utility  rate  base,
operating  expenses  and rate of return and related  taxes.   The
Company,  FERC staff, and all intervenors but one have reached  a
proposed  settlement which was filed with the FERC on  March  20,
1998.   On April 28, 1998, the Presiding Administrative Law Judge
issued  an order certifying the settlement to the FERC.  On  July
15,  1998,  the  Commission issued an "Order Approving  Offer  of
Settlement  and  Remanding Case For Hearing."   Applications  for
rehearing of this order are due by August 14, 1998.  The  Company
believes  it  has  provided  an  adequate  reserve  for  amounts,
including interest, which may be refunded to customers.
<PAGE>
   Royalty Claims and Producer Litigation

    In  connection  with the Company's renegotiations  of  supply
contracts  with  producers  to  resolve  take-or-pay  and   other
contract claims, the Company has entered into certain settlements
which  may require the indemnification by the Company of  certain
claims for royalties which a producer may be required to pay as a
result  of such settlements.  The Company has been made aware  of
demands  on  producers for additional royalties and  may  receive
other  demands which could result in claims against  the  Company
pursuant  to  the  indemnification provision in its  settlements.
Indemnification for royalties will depend on, among other things,
the specific lease provisions between the producer and the lessor
and  the  terms  of the settlement between the producer  and  the
Company.   Pursuant  to such an indemnity, in January  1998,  the
Company  reimbursed a producer for approximately $1.7 million  in
costs  paid  to settle a take-or-pay royalty claim.  The  Company
may  file  to recover 75 percent of any such amounts  it  may  be
required to pay pursuant to indemnifications for royalties  under
the  provisions  of  FERC Order 528.  The  Company  has  provided
reserves for the estimated settlement costs of its royalty claims
and litigation.

   Environmental Matters

     As  of  June  30,  1998,  the  Company  had  a  reserve   of
approximately  $1.9 million for estimated costs  associated  with
environmental  assessment and remediation, including  remediation
associated  with the historical use of polychlorinated  biphenyls
and  hydrocarbons.   This  estimate  depends  upon  a  number  of
assumptions  concerning  the scope of remediation  that  will  be
required  at certain locations and the cost of remedial  measures
to   be   undertaken.   The  Company  is  continuing  to  conduct
environmental  assessments  and  is  implementing  a  variety  of
remedial  measures that may result in increases or  decreases  in
the total estimated costs.

    The  Company  currently  is either  named  as  a  potentially
responsible   party  or  has  received  an  information   request
regarding  its  potential involvement at  certain  Superfund  and
state  waste disposal sites.  The anticipated remediation  costs,
if  any,  associated with these sites have been included  in  the
reserve discussed above.

   The Company considers environmental assessment and remediation
costs  and  costs  associated with compliance with  environmental
standards  to be recoverable through rates, as they  are  prudent
costs  incurred in the ordinary course of business.   The  actual
costs  incurred will depend on the actual amount  and  extent  of
contamination discovered, the final cleanup standards mandated by
the  U.S.  Environmental Protection Agency or other  governmental
authorities, and other factors.

   Summary of Contingent Liabilities and Commitments

   While no assurances may be given, the Company does not believe
that the ultimate resolution of the foregoing matters, taken as a
whole  and  after  consideration of  amounts  accrued,  insurance
coverage,   potential   recovery   from   customers   or    other
indemnification  arrangements, will  have  a  materially  adverse
effect  on  the Company's future financial position,  results  of
operations or cash flow requirements.
<PAGE>

C.  Adoption of Accounting Standard

    The Financial Accounting Standards Board has issued Statement
of  Financial  Accounting Standards (SFAS) No. 131,  "Disclosures
about Segments of an Enterprise and Related Information" and SFAS
No.  132,  "Employer's Disclosures About Pension and  Other  Post
Retirement  Benefits," both effective for fiscal years  beginning
after  December  15, 1997.  SFAS Nos. 131 and 132 are  disclosure
oriented; therefore, these pronouncements will not have an effect
on  the  Company's financial position, results of  operations  or
cash flow requirements.

<PAGE>

Item  2.  Management's  Narrative Analysis  of  the  Results  of
            Operations (Filed Pursuant to General Instruction H)

                Financial Analysis of Operations
           Six Months Ended June 30, 1998 Compared to
                 Six Months Ended June 30, 1997


    The Company's gas sales result from requirements to meet  its
pre-Order  636  gas  purchase commitments, substantially  all  of
which  are  managed  by  the Company's gas  marketing  affiliate,
Williams  Energy  Services Company, as exclusive  agent  for  the
Company.   Although the sales and purchase commitments remain  in
the Company's name, their management and any associated profit or
loss  is solely the responsibility of the agent.  Therefore,  the
resulting  sales  and purchases have no impact on  the  Company's
results of operations.

   Operating  income was $1.4 million higher for the  six  months
ended June 30, 1998, than for the six months ended June 30, 1997.
The  increase  in  operating income was due  primarily  to  lower
operation   and  maintenance  expenses  and  lower  general   and
administrative  expenses  partially  offset  by  the  effect   of
favorable  resolutions  in  1997 of certain  contractual  issues.
Compared to 1997, net income was $0.8 million lower due to  lower
interest  income  as a result of lower advances to  Williams  and
lower interest rates, offset by the reasons discussed above.

     Operating   revenues  decreased  $19.4   million   primarily
attributable  to  lower  gas  sales, lower  transportation  costs
charged  to the Company by others and passed through to customers
as  provided in the Company's rates, and the effect of  favorable
resolutions  in  1997  of  certain  contractual  issues.    Total
deliveries  were  391.0 Tbtu and 402.6 Tbtu  for  the  first  six
months of 1998 and 1997, respectively.

       Operating  costs  and  expenses  decreased  $20.8  million
primarily  attributable to lower cost of gas sold and lower  cost
of  gas  transportation,  both of which  are  passed  through  to
customers,  as well as lower operation, maintenance, general  and
administrative expenses.

                                
                Financial Condition and Liquidity

   Through the years, the Company has consistently maintained its
financial  strength  and experienced strong operational  results.
Williams' ownership of the Company further enhances its financial
and  operational strength, as well as allows the Company to  take
advantage  of new opportunities for growth.  The Company  expects
to  access  public  and private capital markets,  as  needed,  to
finance its own capital requirements.

    The Company is a participant with other Williams subsidiaries
in  a  $1  billion credit agreement under which the  Company  may
borrow  up  to  $200  million, subject  to  borrowings  by  other
affiliated  companies.  Interest rates vary with  current  market
conditions.   To  date,  the Company has no  amounts  outstanding
under this facility.
<PAGE>
   The  Company  is  a participant in Williams'  cash  management
program.    The   advances  due  the  Company  by  Williams   are
represented  by  demand  notes payable. Those  amounts  that  the
Company anticipates Williams will repay in the next twelve months
are classified as current assets; any remainder is classified  as
noncurrent.   The interest rate on intercompany demand  notes  is
the  London Interbank Offered Rate on the first day of the  month
plus  an  applicable  margin based on the  current  Standard  and
Poor's Rating of the Borrower.

   The Company's capital expenditures for the first six months of
1998 and 1997 were $26.5 million and $31.1 million, respectively.
Capital  expenditures for 1998 are expected to approximate  $59.2
million.    The   Company's  debt  as  a  percentage   of   total
capitalization at June 30, 1998 and December 31, 1997  was  28.4%
and 28.1%, respectively.

      On July 21, 1997, the Company filed an application with the
FERC  to authorize construction, installation and operation of  a
4,600  horsepower compressor engine and associated facilities  at
its  Haughton  Compressor  Station  in  Louisiana.   The  Company
received  an  order  on  March 17, 1998,  issuing  a  certificate
authorizing  the  construction and operation of facilities.   The
project  is expected to cost approximately $6 million,  which  is
included  in  the 1998 capital expenditure estimate  above.   The
Company proposes to have the facilities in service by November 1,
1998.

    On  April  30,  1997, the Company filed a general  rate  case
(Docket  No.  RP97-344) effective November 1,  1997,  subject  to
refund.   This  rate  case  reflects a requested  annual  revenue
increase  of  approximately $70.9 million, based on filed  rates,
primarily  attributable to increases in the  utility  rate  base,
operating  expenses  and rate of return and related  taxes.   The
Company,  FERC staff, and all intervenors but one have reached  a
proposed  settlement which was filed with the FERC on  March  20,
1998.   On April 28, 1998, the Presiding Administrative Law Judge
issued  an order certifying the settlement to the FERC.  On  July
15,  1998,  the  Commission issued an "Order Approving  Offer  of
Settlement  and  Remanding Case for Hearing."   Applications  for
rehearing of this order are due by August 14, 1998.  The  Company
believes  it  has  provided  an  adequate  reserve  for  amounts,
including interest, which may be refunded to customers.

    Williams, including the Company, has initiated an enterprise-
wide  project to address the year 2000 compliance issue  for  all
technology  hardware  and  software,  external  interfaces   with
customers  and suppliers, operations process control,  automation
and  instrumentation systems, and facility items.  The assessment
phase  of  this  project  is substantially  complete.   Necessary
conversion,  replacement activities, and testing have  begun  and
will  continue through 1999.  The Company has initiated a  formal
communications process with other companies which  the  Company's
systems  interface  with or rely on to determine  the  extent  to
which  those companies are addressing their year 2000 compliance.
Costs  incurred for new software and hardware purchases  will  be
capitalized  and other costs will be expensed as  incurred.   The
Company  considers costs associated with the year 2000 compliance
to  be  prudent costs incurred in the ordinary course of business
and  therefore, recoverable through rates.  The Company estimates
<PAGE>
that the costs, excluding previously planned system replacements,
necessary to complete the project  within  the schedule described
will be immaterial.  The costs of the  project and the completion
dates  are  based  on management's   best  estimates,  which were
derived utilizing numerous assumptions of future events, including
the  continued availability  of  certain  resources,  third party
year   2000 compliance  modification  plans,  and  other factors.
There can  be no  guarantee that these estimates will be achieved,
and  actual results could differ materially from these estimates.

<PAGE>


                   PART II - OTHER INFORMATION



Item 6. Exhibits and Reports on Form 8-K

        (a) Exhibits
               
            * 27.1  Financial Data Schedule for Texas Gas Transmission
                    Corporation for the six months ending June 30, 1998.


        (b) Reports on Form 8-K

            None
        _____________________________

        *  Filed herewith




<PAGE>







                        S I G N A T U R E


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

                               TEXAS GAS TRANSMISSION CORPORATION



DATE: August 11, 1998          BY:  /s/ S. W. Harris

                                       S. W. Harris
                             Controller and Chief Accounting Officer