Contract #:  800423


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS

                  This Service Agreement, made and entered into this 15th
      day of November, 1996, by and between TEXAS EASTERN TRANSMISSION
      CORPORATION, a Delaware Corporation (herein called "Pipeline") and
      CONNECTICUT NATURAL GAS CORPORATION (herein called "Customer", whether
      one or more),

                               W I T N E S S E T H:

                  WHEREAS, Customer is a customer of Algonquin Gas
      Transmission Company ("Algonquin"); and

                  WHEREAS, Algonquin is a customer of Pipeline under certain
      of Pipeline's rate schedules and related service agreements; and

                  WHEREAS, pursuant to the Federal Energy Regulatory
      Commisssion's ("Commission") order issued on July 8, 1994, in Docket
      Nos. RP93-14-000, et al., and 18 C.F.R. Section 284.242, Algonquin is
      assigning on a permanent basis certain of its firm service
      entitlements on Pipeline to certain of Algonquin's direct customers;
      and

                  WHEREAS, Customer's capacity entitlements on Pipeline
      pursuant to this Service Agreement are a result of Algonquin's
      permanent assignment to Customer as described above; and

                  WHEREAS, Customer and Pipeline desire to enter into this
      Service Agreement to reflect such permanent assignment from Algonquin
      to Customer;

                  NOW, THEREFORE, in consideration of the premises and of
      the mutual covenants and agreements herein contained, the parties do
      covenant and agree as follows:


                                     ARTICLE I

                                SCOPE OF AGREEMENT

                  Subject to the terms, conditions and limitations hereof,
      of Pipeline's Rate Schedule CDS, and of the General Terms and
      Conditions, transportation service hereunder will be firm.  Subject to
      the terms, conditions and limitations hereof and of Sections 2.3 and
      2.4 of Pipeline's Rate Schedule CDS, Pipeline shall deliver to those
      points on Pipeline's system as specified in Article IV herein or
      available to Customer pursuant to Section 14 of the General Terms and
      Conditions (hereinafter referred to as Point(s) of Delivery), for
      Customer's account, as requested for any day, natural gas quantities
      up to Customer's MDQ.  Customer's MDQ is as follows:

                       Maximum Daily Quantity (MDQ) 644 dth<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

                  Subject to variances as may be permitted by Sections 2.4
      of Rate Schedule CDS or the General Terms and Conditions, Customer
      shall deliver to Pipeline and Pipeline shall receive, for Customer's
      account, at those points on Pipeline's system as specified in Article
      IV herein or available to Customer pursuant to Section 14 of the
      General Terms and Conditions (hereinafter referred to as Point(s) of
      Receipt) daily quantities of gas equal to the daily quantities
      delivered to Customer pursuant to this Service Agreement up to
      Customer's MDQ, plus Applicable Shrinkage as specified in the General
      Terms and Conditions.  

                  Pipeline shall not be obligated to, but may at its
      discretion, receive at any Point of Receipt on any day a quantity of
      gas in excess of the applicable Maximum Daily Receipt Obligation
      (MDRO), plus Applicable Shrinkage, but shall not receive in the
      aggregate at all Points of Receipt on any day a quantity of gas in
      excess of the applicable MDQ, plus Applicable Shrinkage.  Pipeline
      shall not be obligated to, but may at its discretion, deliver at any
      Point of Delivery on any day a quantity of gas in excess of the
      applicable Maximum Daily Delivery Obligation (MDDO), but shall not
      deliver in the aggregate at all Points of Delivery on any day a
      quantity of gas in excess of the MDQ.

                  In addition to the MDQ and subject to the terms,
      conditions and limitations hereof, Rate Schedule CDS and the General
      Terms and Conditions, Pipeline shall deliver within the Access Area
      under this and all other service agreements under Rate Schedules CDS,
      FT-1, and/or SCT, quantities up to Customer's Operational Segment
      Capacity Entitlements, excluding those Operational Segment Capacity
      Entitlements scheduled to meet Customer's MDQ, for Customer's account,
      as requested on any day.


                                    ARTICLE II

                                TERM OF AGREEMENT 

                  The term of this Service Agreement shall commence on
      September 1, 1994 and shall continue in force and effect  until
      10/31/2012 and year to year thereafter unless this Service Agreement
      is terminated as hereinafter provided.  This Service Agreement may be
      terminated by either Pipeline or Customer upon five (5) years prior
      written notice to the other specifying a termination date of any year
      occurring on or after the expiration of the primary term.  Subject to
      Section 22 of Pipeline's General Terms and Conditions and without
      prejudice to such rights, this Service Agreement may be terminated at
      any time by Pipeline in the event Customer fails to pay part or all of
      the amount of any bill for service hereunder and such failure
      continues for thirty (30) days after payment is due; provided,
      Pipeline gives  thirty (30) days prior written notice to Customer of
      such termination and provided further such termination shall not be
      effective if,


                                         2
                                                                    800423<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

      prior to the date of termination, Customer either pays such
      outstanding bill or furnishes a good and sufficient surety bond
      guaranteeing payment to Pipeline of such outstanding bill.  

                  THE TERMINATION OF THIS SERVICE AGREEMENT WITH A FIXED
      CONTRACT TERM OR THE PROVISION OF A TERMINATION NOTICE BY CUSTOMER
      TRIGGERS PREGRANTED ABANDONMENT UNDER SECTION 7 OF THE NATURAL GAS ACT
      AS OF THE EFFECTIVE DATE OF THE TERMINATION.  PROVISION OF A
      TERMINATION NOTICE BY PIPELINE ALSO TRIGGERS CUSTOMER'S RIGHT OF FIRST
      REFUSAL UNDER SECTION 3.13 OF THE  GENERAL TERMS AND CONDITIONS ON THE
      EFFECTIVE DATE OF THE TERMINATION.

                  Any portions of this Service Agreement necessary to
      correct or cash-out imbalances under this Service Agreement as
      required by the General Terms and Conditions of Pipeline's FERC Gas
      Tariff, Volume No. 1, shall survive the other parts of this Service
      Agreement until such time as such balancing has been accomplished.


                                    ARTICLE III

                                   RATE SCHEDULE

                  This Service Agreement in all respects shall be and remain
      subject to the applicable provisions of Rate Schedule CDS and of the
      General Terms and Conditions of Pipeline's FERC Gas Tariff on file
      with the Federal Energy Regulatory Commission, all of which are by
      this reference made a part hereof.

                  Customer shall pay Pipeline, for all services rendered
      hereunder and for the availability of such service in the period
      stated, the applicable prices established under Pipeline's Rate Sche-
      dule CDS as filed with the Federal Energy Regulatory Commission, and
      as same may hereafter be legally amended or superseded.

                  Customer agrees that Pipeline shall have the unilateral
      right to file with the appropriate regulatory authority and make
      changes effective in (a) the rates and charges applicable to service
      pursuant to Pipeline's Rate Schedule CDS, (b) Pipeline's Rate Schedule
      CDS pursuant to which service hereunder is rendered or (c) any
      provision of the General Terms and Conditions applicable to Rate Sche-
      dule CDS.  Notwithstanding the foregoing, Customer does not agree that
      Pipeline shall have the unilateral right without the consent of
      Customer subsequent to the execution of this Service Agreement and
      Pipeline shall not have the right during the effectiveness of this
      Service Agreement to make any filings pursuant to Section 4 of the
      Natural Gas Act to change the MDQ specified in Article I, to change
      the term of the agreement as specified in Article II, to change
      Point(s) of





                                         3  
                                                                    800423<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

      Receipt specified in Article IV, to change the Point(s) of Delivery
      specified in Article IV, or to change the firm character of the
      service hereunder.  Pipeline agrees that Customer may protest or
      contest the aforementioned filings, and Customer does not waive any
      rights it may have with respect to such filings.


                                    ARTICLE IV

                   POINT(S) OF RECEIPT AND POINT(S) OF DELIVERY

                  The Point(s) of Receipt and Point(s) of Delivery at which
      Pipeline shall receive and deliver gas, respectively, shall be
      specified in Exhibit(s) A and B of the executed service agreement. 
      Customer's Zone Boundary Entry Quantity and Zone Boundary Exit
      Quantity for each of Pipeline's  zones shall be specified in Exhibit C
      of the executed service agreement.

                  Exhibit(s) A, B and C are hereby incorporated as part of
      this Service Agreement for all intents and purposes as if fully copied
      and set forth herein at length.


                                     ARTICLE V

                                     QUALITY 

                  All natural gas tendered to Pipeline for Customer's
      account shall conform to the quality specifications set forth in
      Section 5 of Pipeline's General Terms and Conditions.  Customer agrees
      that in the event Customer tenders for service hereunder and Pipeline
      agrees to accept natural gas which does not comply with Pipeline's
      quality specifications, as expressly provided for in Section 5 of
      Pipeline's General Terms and Conditions, Customer shall pay all costs
      associated with processing of such gas as necessary to comply with
      such quality specifications.  Customer shall execute or cause its
      supplier to execute, if such supplier has retained processing rights
      to the gas delivered to Customer, the appropriate agreements prior to
      the commencement of service for the transportation and processing of
      any liquefiable hydrocarbons and any PVR quantities associated with
      the processing of gas received by Pipeline at the Point(s) of Receipt
      under such Customer's service agreement.  In addition, subject to the
      execution of appropriate agreements, Pipeline is willing to transport
      liquids associated with the gas produced and tendered for
      transportation hereunder.









                                         4
                                                                    800423<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

                                    ARTICLE VI

                                     ADDRESSES

                  Except as herein otherwise provided or as provided in the
      General Terms and Conditions of Pipeline's FERC Gas Tariff, any
      notice, request, demand, statement, bill or payment provided for in
      this Service Agreement, or any notice which any party may desire to
      give to the other, shall be in writing and shall be considered as duly
      delivered when mailed by registered, certified, or regular mail to the
      post office address of the parties hereto, as the case may be, as
      follows:

                  (a) Pipeline:   TEXAS EASTERN TRANSMISSION CORPORATION
                                  5400 Westheimer Court
                                  Houston, TX  77056-5310

                  (b) Customer:   CONNECTICUT NATURAL GAS CORPORATION
                                       P.O. Box 1500
                                       100 Columbus Boulevard
                                       Hartford, CT  06144

      or such other address as either party shall designate by formal
      written notice.


                                    ARTICLE VII

                                    ASSIGNMENTS

                  Any Company which shall succeed by purchase, merger, or
      consolidation to the properties, substantially as an entirety, of
      Customer, or of Pipeline, as the case may be, shall be entitled to the
      rights and shall be subject to the obligations of its predecessor in
      title under this Service Agreement; and either Customer or Pipeline
      may assign or pledge this Service Agreement under the provisions of
      any mortgage, deed of trust, indenture, bank credit agreement,
      assignment, receivable sale, or similar instrument which it has
      executed or may execute hereafter; otherwise, neither Customer nor
      Pipeline shall assign this Service Agreement or any of its rights
      hereunder unless it first shall have obtained the consent thereto in
      writing of the other; provided further, however, that neither Customer
      nor Pipeline shall be released from its obligations hereunder without
      the consent of the other.  In addition, Customer may assign its rights
      to capacity pursuant to Section 3.14 of the General Terms and
      Conditions.  To the extent Customer so desires, when it releases
      capacity pursuant to Section 3.14 of the General Terms and Conditions,
      Customer may require privity between Customer and the Replacement
      Customer, as further provided in the applicable Capacity Release
      Umbrella Agreement.




                                         5
                                                                     800423<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

                                   ARTICLE VIII

                                  INTERPRETATION

                  The interpretation and performance of this Service
      Agreement shall be in accordance with the laws of the State of Texas
      without recourse to the law governing conflict of laws.

                  This Service Agreement and the obligations of the parties
      are subject to all present and future valid laws with respect to the
      subject matter, State and Federal, and to all valid present and future
      orders, rules, and regulations of duly constituted authorities having
      jurisdiction.


                                    ARTICLE IX

                         CANCELLATION OF PRIOR CONTRACT(S)

                  This Service Agreement supersedes and cancels, as of the
      effective date of this Service Agreement, the contract(s) between the
      parties hereto as described below:

                                       None 






























                                         6 
                                                                    800423<PAGE>


                                 SERVICE AGREEMENT
                               FOR RATE SCHEDULE CDS
                                    (Continued)
      

                  IN WITNESS WHEREOF, the parties hereto have caused this
      Service Agreement  to be signed by their respective Presidents, Vice
      Presidents or other duly authorized agents and their respective
      corporate seals to be hereto affixed and attested by their respective
      Secretaries or Assistant Secretaries, the day and year first above
      written.

                                       TEXAS EASTERN TRANSMISSION
      CORPORATION



                                       By  Robert B. Evans
                                          ----------------------------------
                                            Vice President




      ATTEST:


      Robert W. Reed
      -------------------------




                                       CONNECTICUT NATURAL GAS CORPORATION



                                       By Edna M. Karanian
                                         ----------------------------------



      ATTEST:



      R. L. Babcock
      --------------------------


       








                                         7                             800423<PAGE>
<TABLE>
<CAPTION>
                                                           Contract #: 800423

                                                   EXHIBIT A, TRANSPORTATION PATHS
                                              FOR BILLING PURPOSES, DATED            ,
                                          TO THE SERVICE AGREEMENT UNDER RATE SCHEDULE CDS
                                  BETWEEN TEXAS EASTERN TRANSMISSION CORPORATION ("Pipeline"), AND
                                          CONNECTICUT NATURAL GAS CORPORATION ("Customer"),
                                                       DATED                :

      (1)         Customer's firm Point(s) of Receipt:

      <C>            <S>                                  <C>                  <C>                 <C>       <C>       
                                                          Maximum Daily Receipt
                                                               Obligation (plus
                                                                     Applicable
      Point of                                                 Shrinkage) (dth)   Measurement
      Receipt               Description                      ------------------Responsi-bilities    Owner     Operator 
      ---------      -----------------------------                                -----------      --------  ----------
      None

</TABLE>
      (2)         Customer shall have Pipeline's Master Receipt Point List
                  ("MRPL").  Customer hereby agrees that Pipeline's MRPL as
                  revised and published by Pipeline from time to time is
                  incorporated herein by reference.

      Customer hereby agrees to comply with the Receipt Pressure Obligation as
      set forth in Section 6 of Pipeline's General Terms and Conditions at
      such Point(s) of Receipt.



      Transportation          Transportation Path
      Path                    Quantity (Dth/D)
      --------------          --------------------

         M1 to M3                    644



      SIGNED FOR IDENTIFICATION

      PIPELINE:   _________________________

      CUSTOMER:   __________________________

                                         A-1                             800423<PAGE>

                                                       Contract #: 800423


                                  EXHIBIT A, TRANSPORTATION PATHS, Continued
                                      CONNECTICUT NATURAL GAS CORPORATION


      SUPERSEDES EXHIBIT A DATED:  _________





































                                         A-2                             800423<PAGE>


                                                             Contract #:800423

<TABLE>
<CAPTION>
                 EXHIBIT B, POINT(S) OF DELIVERY, DATED            ,
                  TO THE SERVICE AGREEMENT UNDER RATE SCHEDULE CDS
          BETWEEN TEXAS EASTERN TRANSMISSION CORPORATION ("Pipeline"), AND
                  CONNECTICUT NATURAL GAS CORPORATION ("Customer"),
                               DATED                :

           <C>          <S>                           <C>          <C>            <C>            <C>          <C>
                                                      Maximum Daily
                                                      Delivery      Delivery      Measurement
             Point of                                 Obligation    Pressure      Responsi-
             Delivery          Description            ------------- Obligation     bilities       Owner        Operator  
             ---------         -----------               (dth)      ----------    ------------   ------------ ----------
           1.70087       ALGONQUIN - LAMBERTVILLE, NJ     644       AS REQUESTED  TX EAST TRAN   TX EAST TRAN ALGONQUIN
                         HUNTERDON CO. CO., NJ                      BY CUSTOMER,
                                                                    NOT TO EXCEED
                                                                    750 POUNDS PER
                                                                    SQUARE INCH
                                                                    GAUGE 
           2.71078       ALGONQUIN - HANOVER, NJ          644       AS REQUESTED  TX EAST TRAN   TX EAST TRAN ALGONQUIN
                         MORRIS CO. CO., NJ                         BY CUSTOMER,
                                                                    NOT TO
                                                                    EXCEED750
                                                                    POUNDS PER
                                                                    SQUARE INCH
                                                                    GAUGE
           3.79823       AGT-CONNECTICUT NATURAL FOR        0       N/A           N/A            N/A          N/A
                         NOMINATION PURPOSES  
           4.79513       FSS-1 AND SS-1 STORAGE POINT     644       N/A           N/A            N/A          N/A
                                                      04/01-10/31
                                                          644
                                                      11/01-03/31

</TABLE>
     provided, however, that until changed by a subsequent
     Agreement between Pipeline and Customer, Pipeline's
     aggregate maximum daily delivery obligations under this and
     all other firm Service Agreements existing between Pipeline
     and Customer, shall in no event exceed the following:




                                  B-1                      800423r1.cng<PAGE>


<TABLE>
<CAPTION>
                                                 Contract #:  800423

                     EXHIBIT B, POINT(S) OF DELIVERY (Continued)
                         CONNECTICUT NATURAL GAS CORPORATION


                              <S>                                       <C>
                                                                        Aggregate Maximum Daily
                              Point of Delivery                          Delivery Obligation (dth)
                              -----------------                          -------------------------
                              No. 1                                           54,617
                              No. 2                                           31,626
                              No. 4                                            9,506

</TABLE>













      SIGNED FOR IDENTIFICATION

      PIPELINE:                                      

      CUSTOMER:                                      

      SUPERSEDES EXHIBIT B DATED                     
       








                                         B-2                     800423r1.cng
<PAGE>


                                                           Contract #:  800423

                     EXHIBIT B, POINT(S) OF DELIVERY (Continued)
                         CONNECTICUT NATURAL GAS CORPORATION


                                                             Contract #:800423


      EXHIBIT C, ZONE BOUNDARY ENTRY QUANTITY AND ZONE BOUNDARY EXIT QUANTITY,
      DATED ____________________, TO THE SERVICE AGREEMENT UNDER RATE SCHEDULE
      CDS
           BETWEEN TEXAS EASTERN TRANSMISSION CORPORATION ("PIPELINE") AND
      CONNECTICUT NATURAL GAS CORPORATION ("CUSTOMER"), DATED________________:


                            ZONE BOUNDARY ENTRY QUANTITY
                                        Dth/D

                                         To
                                         --

<TABLE>
   <S><C>     <C>   <C>  <C>    <C>    <C>      <C>     <C>      <C>       <C>     <C>      <C>      <C>        <C>        <C>
      FROM    STX   ETX  WLA    ELA    M1-24    M1-30   M1-TXG   M1-TGC    M2-24   M2-30    M2-TXG   M2-TGC     M2         M3
   STX                                                                 18
   ETX                                      78                28
   WLA                                                         8       18
   ELA                                              504
   M1-24                                                                        78
   M1-30                                                                               504
   M1-TXG                                                                                        36
   M1-TGC                                                                                                 37
   M2-24
   M2-30
   M2-TXG
   M2-TGC
   M2                                                                                                                         644
   M3

</TABLE>




                                                                 C-1<PAGE>


                                                           Contract #:  800423

                     EXHIBIT B, POINT(S) OF DELIVERY (Continued)
                         CONNECTICUT NATURAL GAS CORPORATION

<TABLE>
<CAPTION>
                                                                                                                Contract #:800423
                                                        EXHIBIT C (Continued)
                                                 CONNECTICUT NATURAL GAS CORPORATION

                                                     ZONE BOUNDARY EXIT QUANTITY
                                                                Dth/D

                                                                 To
                                                                 --


   <S><C>    <C>    <C>    <C>    <C>     <C>      <C>     <C>      <C>      <C>     <C>      <C>      <C>        <C>      <C>
      FROM   STX    ETX    WLA    ELA     M1-24    M1-30   M1-TXG   M1-TGC   M2-24   M2-30    M2-TXG   M2-TGC     M2       M3
   STX
   ETX
   WLA
   ELA
   M1-24                                                                          78
   M1-30                                                                                 504
   M1-TXG                                                                                          36
   M1-TGC                                                                                                   37
   M2-24
   M2-30
   M2-TXG
   M2-TGC
   M2                                                                                                                         644
   M3

</TABLE>

   SIGNED FOR IDENTIFICATION:

   PIPELINE:                                           

   CUSTOMER:                                            

   SUPERCEDES EXHIBIT C DATED                           
    


                                                                 C-2<PAGE>