Contract #:  800424


                                  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) 851 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                           800424<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 Schedule 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 Schedule 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                           800424<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 and B 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                           800424<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                       800424<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 juris-
      diction.


                                      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                      800424<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
      -------------------------
      Corporate Secretary




                                       CONNECTICUT NATURAL GAS CORPORATION



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



      ATTEST:


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


       










                                          7                      800424<PAGE>
<TABLE>
<CAPTION>
                                                                                                               Contract #: 800424

                                                   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
      Point of                                                       Applicable   Measurement
      Receipt               Description                       Shrinkage) (dth) 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)
      -------------------     ---------------------

          M3 to M3                    851



      SIGNED FOR IDENTIFICATION

      PIPELINE:   _________________________

      CUSTOMER:   __________________________

                                         A-1                         800424<PAGE>

                                                           Contract #: 800424


                           EXHIBIT A, TRANSPORTATION PATHS, Continued
                               CONNECTICUT NATURAL GAS CORPORATION


      SUPERSEDES EXHIBIT A DATED:  _________





































                                         A-2                    800424<PAGE>


<TABLE>
<CAPTION>
                                                             Contract #:800424

                 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     365       AS REQUESTED  TX EAST TRAN   TX EAST TRAN ALGONQUIN
                         HUNTERDON CO. CO., NJ                      BY CUSTOMER,
                                                                    NOT TO EXCEED
                                                                    750 POUNDS PER
                                                                    SQUARE GAUGE 
           2.71078       ALGONQUIN - HANOVER, NJ          486       AS REQUESTED  TX EAST TRAN   TX EAST TRAN ALGONQUIN
                         MORRIS CO. CO., NJ                         BY CUSTOMER,
                                                                    NOT TO
                                                                    EXCEED750
                                                                    POUNDS PER
                                                                    SQUARE GAUGE
           3.79823       AGT-CONNECTICUT NATURAL FOR        0       N/A           N/A            N/A          N/A
                         NOMINATION PURPOSES  
                           
                           
</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                      800424<PAGE>
<TABLE>
<CAPTION>

                                                           Contract #:  800424

                     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


</TABLE>





      SIGNED FOR IDENTIFICATION

      PIPELINE:                                      

      CUSTOMER:                                      

      SUPERSEDES EXHIBIT B DATED                     
       













                                         B-2                       800424<PAGE>