CNG NONEMPLOYEE DIRECTORS' FEE PLAN
                         ------------------------------------
           
           
           
          1.   Purpose
               -------
           
               The CNG NONEMPLOYEE DIRECTORS' FEE PLAN (the "Plan") of
               Connecticut Natural Gas Corporation (the "Company") is
               established to attract and retain as members of the
               Company's Board of Directors persons who are not full-time
               employees of the Company or any of its subsidiaries but
               whose business experience and judgment can make a valuable
               management contribution to the Company and its subsidiaries. 
               This document amends and restates, effective October 1,
               1996, the Plan which was originally adopted effective
               January 1, 1976.
           
          2.   Directors Covered
               -----------------
           
               As used in the Plan, the term "Director" means any person
               who was elected to the Board of Directors of the Company and
               who is not a full-time employee of the Company or any of its
               subsidiaries.
           
          3.   Deferral of Fees
               ----------------

               (a)  Any Director of the Company, by giving notice to the
                    Secretary of the Company, may elect to defer all or a
                    portion of the payment of the annual retainer and
                    meeting fees which he will earn subsequent to the date
                    on which such notice is given.  Such election may be
                    revoked by the Director giving written notice to the
                    Secretary as to retainer and meeting fees earned
                    subsequent to such revocation.  A Director who makes
                    such an election to defer hereunder shall sometimes be
                    referred to as a "Participant" hereunder.
           
               (b)  All fees deferred pursuant to the Plan shall earn
                    interest at a rate equal to such rates of return on
                    common equity as the Company is authorized from time to
                    time to earn by the Connecticut Department of Public
                    Utility Control (DPUC), commencing January 1, 1982. 
                    Such interest shall be compounded quarterly.  The rate
                    of interest to be accrued hereunder shall be adjusted
                    on the first day of the month next following the date
                    on which any rates newly approved by the DPUC become
                    fully effective.  For the purpose of calculating such
                    interest, current year fees shall be considered earned
                    as of the last day of the calendar quarter in which the
                    services were performed.  If a Director elects a form<PAGE>





                    of payment other than a lump sum, interest shall
                    continue to be credited to the unpaid balance for the
                    duration of the payment period.  For purposes of the
                    Plan, the term "deferred fees" shall include any such
                    interest credited thereon.  Fees so accounted for under
                    this Paragraph 3(b) shall be referred to as "Account A"
                    of this Plan.
           
               (c)  Effective September 29, 1995, the Company has
                    established the CNG Nonemployee Directors' Fee Plan
                    Trust Agreement.  The intent of the Company is to
                    transfer assets to the Trustee of said Trust over a
                    period of time in amounts sufficient to equal the
                    amount of benefits payable under the Plan. 
                    Accordingly, effective September 29, 1995, an "Account
                    B" shall be established for each Participant under the
                    Plan.  Account B shall include any portions of a
                    Participant's Plan balance, from that point forward,
                    for which contributions have been made to the Trust and
                    have been invested in accordance with the Trust
                    Agreement.  Amounts contributed to the Trust and
                    accounted for under Account B shall include fees
                    deferred subsequent to the effective date above;
                    contributions previously deemed made to Account A that
                    are periodically transferred from the Account A
                    balance; and earnings deemed to have been credited to
                    Account A that are periodically transferred from the
                    Account A balance.  This approach shall continue until
                    the Trust is equal in value to the amount of benefits
                    payable under the Plan, at which point all Plan
                    balances will be accounted for under Account B.  A rate
                    of return shall be credited to Account B based on the
                    rate of return on assets invested in the Trust.  An
                    accounting shall be maintained of each Participant's
                    Plan balances allocated to Account A and Account B. 
                    Notwithstanding the foregoing, the Company shall have
                    no obligation to make any contribution to the Trust. 
                    In the event and to the extent that a contribution is
                    not made for such amounts, then the provisions of
                    subparagraph (b) hereof, relating to returns on
                    investments, shall apply until such time as such
                    contributions are made.  Furthermore, any contributions
                    shall be subject to the terms of said Trust Agreement.
           
               (d)  Effective October 1, 1996, a Director shall have the
                    right to, but shall not be required to, indicate to the
                    Trustee of the Trust Agreement the preference of the
                    Director with respect to the investment of amounts
                    allocated to Account B as well as future contributions
                    thereto.  The Trustee may invest such amounts in
                    accordance with the preferences expressed by the
                    Director.  In the event no such indication is given,

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                    the Trustee shall nevertheless continue to invest such
                    amounts allocated to Account B and future contributions
                    thereto on behalf of the Director.  The investment
                    options available to a Director shall include only
                    those investment options as are available to
                    participants in the CNG Employee Savings Plan from time
                    to time, including CNG Common Stock.  All expressions
                    of investment preference by a Director shall be in
                    increments of 5%.  Furthermore, the rules relating to
                    the frequency of changes to the investment of Account B
                    and future contributions thereto shall pattern those
                    applicable under the CNG Employee Savings Plan from
                    time to time.  Currently, such changes are allowed once
                    per calendar quarter.
           
          4.   Payment of Deferred Fees
               ------------------------
           
               (a)  At the time of the election by a Director to defer all
                    or a portion of the fees and retainer earned for the
                    first year for which this Plan is in effect (1976) or,
                    if later, the time of the first election by a Director
                    to defer all or a portion of the fees and retainer
                    hereunder, a Director by written notice to the
                    Secretary shall make an election specifying the terms
                    and conditions of the payment of the deferred fees. 
                    Unless the Company, in its sole discretion, decides to
                    commence payment in a different manner, a Director's
                    deferred fees earned pursuant to the Plan shall be paid
                    in accordance with the Director's aforesaid written
                    election as to the terms and conditions.
           
               (b)  Effective September 29, 1995, except for lump sum
                    distributions, installment payments from the Plan shall
                    be made quarterly, and recorded on the last day of the
                    quarter after earnings are credited.  Thus, in the case
                    of a distribution to be made over ten years for
                    example, installment payments shall be made as follows: 
                    1/40 of the participant's balance the first quarter,
                    1/39 in the second, 1/38 in the third, and so forth. 
                    Such payments shall first be made out of Account A to
                    the extent there is a balance, and then from Account B.
           
               (c)  A Director whose Account B is invested in whole or in
                    part in CNG Common Stock under the Trust Agreement at
                    the time for distribution shall receive the
                    proportionate amount thereof in CNG Common Stock unless
                    the Director elects to receive such amount in cash.
           




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          5.   Miscellaneous
               -------------
            
               (a)  Each Director or former Director entitled to payment of
                    deferred fees hereunder from time to time may name any
                    person or persons (including, without limitation,
                    individuals, estates, trusts, corporations and other
                    legal entities), who may be named contingently or
                    successively, to whom any deferred Directors' fees
                    earned by him and payable to him are to be paid in case
                    of his death before he receives any or all of such
                    deferred Directors' fees.  The person or persons to
                    whom any deceased Director's or former Director's
                    deferred Directors' fees are payable under this
                    paragraph will be referred to as his "beneficiary". 
                    Each designation will revoke all prior designations by
                    the same Director or former Director, shall be in form
                    prescribed by the Company, and will be effective only
                    when filed by the Director or former Director in
                    writing with the Secretary of the Company during his
                    lifetime.  If a Director or former Director dies prior
                    to the time for the commencement of benefits, or after
                    commencement thereof but prior to completion thereof,
                    then any remaining payments, together with interest
                    accrued thereon, shall be made to his beneficiary as
                    soon as practicable thereafter in a lump sum.  If a
                    deceased Director or former Director shall have failed
                    to name a beneficiary in a manner provided above, or if
                    the beneficiary named by a deceased Director or former
                    Director dies before him or before payment of all the
                    Director's or former Director's deferred Director's
                    fees, and no secondary beneficiary has been designated
                    or is then alive, the Company shall direct payment in a
                    single sum of any remaining deferred Director's fees to
                    the Director's or former Director's spouse, if then
                    living; otherwise to the Director's or former
                    Director's living issue, per stirpes; and in the
                    further event that no such issue are then living, then
                    to the legal representative or representatives of the
                    estate of the Director or former Director.

               (b)  Establishment of the Plan and coverage thereunder of
                    any person shall not be construed to confer any right
                    on the part of such person to be nominated for
                    reelection to the Board of Directors of the Company, or
                    to be reelected to the Board of Directors.

               (c)  Payment of deferred Directors' fees will be made only
                    to the person entitled thereto in accordance with the
                    terms of the Plan, and deferred Directors' fees are not
                    in any way subject to the debts or other obligations of
                    persons entitled thereto, and are not subject in any

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                    manner to anticipation, alienation, sale, transfer,
                    assignment, pledge, encumbrance, attachment, or
                    garnishment by creditors of the Director or the
                    Director's beneficiary.  When a person entitled to a
                    payment under the Plan is under legal disability or, in
                    the Company's opinion, is in any way incapacitated so
                    as to be unable to manage his financial affairs, the
                    Company may direct that payment be made to such
                    person's legal representative, or to a relative or
                    friend of such person for his benefit.  Any payment
                    made in accordance with the preceding sentence shall be
                    in complete discharge of the Company's obligation to
                    make such payment under the Plan.

               (d)  Any action required or permitted to be taken by the
                    Company under the terms of the Plan shall be by
                    affirmative vote of a majority of the members of the
                    Board of Directors then in office.

               (e)  The Company shall maintain such records of fees
                    deferred and income (or loss) credited (or charged)
                    thereto, including records of fees deferred for
                    different periods of time and income (or loss) credited
                    (or charged) thereto, as it shall deem necessary or
                    appropriate in order to accomplish the general purposes
                    of the Plan.

               (f)  The Plan shall be construed and its provisions enforced
                    and administered in accordance with the laws of the
                    State of Connecticut, except as such laws may be
                    superseded by any federal law.

               (g)  All payments hereunder shall be paid in cash, or in CNG
                    Common Stock to the extent provided for in subparagraph
                    (c) of Paragraph 4, and may be made either directly by
                    the Company or from the Trust referred to in Paragraph
                    3.  A Director shall have no right, title or interest
                    whatever in and to any investments which the Company
                    may make to aid it in meeting its obligations hereunder
                    and shall have no right, title or interest in any
                    assets of the Trust referred to in Paragraph 3.  The
                    Plan shall be considered to be unfunded.  To the extent
                    that a Director or beneficiary acquires a right to
                    receive payments hereunder, such right shall be that of
                    a general unsecured creditor of the Company.  The Plan
                    constitutes a mere promise by the Company to pay
                    benefits in the future.

               (h)  The provisions of Paragraphs 3(c), 3(d), 4(b) and 4(c)
                    shall not apply to past participants who have already
                    commenced the receipt of payouts under the Plan.


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               6.   Amendments and Discontinuance
                    -----------------------------

               While the Company expects to continue the Plan, it does
               hereby reserve the right to amend or discontinue the Plan at
               any time; provided, however, that any amendment or
               discontinuance of the Plan shall be prospective in operation
               only and shall not affect the payment of any deferred
               Directors' fees theretofore earned by any Directors, or the
               conditions under which any such fees are to be paid or
               forfeited under the Plan, unless the Director affected shall
               expressly consent thereto.









































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                         CNG NONEMPLOYEE DIRECTORS' FEE PLAN
                         ------------------------------------


               Attached hereto is an amendment and restatement of the CNG

          Nonemployee Directors' Fee Plan, which has been adopted by the

          Board of Directors of CNG at its meeting held on July 23, 1996. 

          The undersigned, being a CNG Director who is participating in the

          Plan, hereby declares that he has been informed of the changes

          which have been made to the Plan in the amendment and

          restatement, and hereby expressly consents to the amendment and

          restatement thereto and the changes made therein.

               Dated at                    , Connecticut this       day of  
                             , 1996.


                                        _________________________________
                                        Name of Director


          _________________________     _________________________________
          Witness                       Signature of Director <PAGE>



                         CNG NONEMPLOYEE DIRECTORS' FEE PLAN

                               ELECTION TO PARTICIPATE
                               ------------------------

          I hereby elect to participate in the Connecticut Natural Gas
          Corporation Nonemployee Directors' Fee Plan and defer payment of
          _____ percent of the annual retainer and meeting fees earned by
          me in _______ and subsequent calendar years.  Such deferred
          retainer and meeting fees will be paid to me as indicated below. 
          I understand that I will be permitted to discontinue the Plan by
          revoking this election and any fees earned after such revocation
          will not be deferred.

          _________________________
          Signature

          ____________________
          Date

                                   PAYMENT OPTIONS
                                   ---------------

          Please indicate time and manner of payment.

          1.   When receipt of deferred Directors' fees shall commence:

               _____ A.  Age sixty       _____ C.  Any other age (Describe) 

               _____ B.  Age sixty-five  _____ D.  Upon termination of
                                                    being a Director

          2.   How payment shall be received:

               _____ A.  One lump sum

               _____ B.  Payments over ten years

               _____ C.  Any other manner (Describe)

          3.   Please indicate the beneficiaries to received deferred fees
          and interest in the event of death prior to receipt of all or any
          part of the deferred fees (beneficiary designation may be revoked
          at any time by change form signed and filed with CNG prior to
          death):

          ____________________________, primary beneficiary

          ____________________________  relationship

          ____________________________, secondary beneficiary

          _____________________________ relationship

          _____________________________      _____________________
          Signature                                  Date<PAGE>





                         CNG NONEMPLOYEE DIRECTORS' FEE PLAN
                                CHANGE OF BENEFICIARY


               I hereby revoke any prior designation of beneficiary and

          choose the following beneficiaries to receive deferred fees and

          interest in the event of death prior to the receipt of all or any

          part of the deferred fees under the CNG Nonemployee Directors'

          Fee Plan.  I understand that this form must be signed by me and

          filed with CNG prior to my death in order to be effective.  I

          reserve the right to revoke this designation of beneficiary by

          change form signed and filed with CNG prior to my death.


          ____________________________, primary beneficiary

          ____________________________  relationship

          ____________________________, secondary beneficiary

          _____________________________ relationship


          _____________________________
          Signature

          __________________
          Date















                         CNG NONEMPLOYEE DIRECTORS' FEE PLAN<PAGE>