1996

          RESULTS

          COMPENSATION

          PROGRAM









          BLACK HILLS POWER AND LIGHT COMPANY

          WYODAK RESOURCES DEVELOPMENT CORP.

          WESTERN PRODUCTION COMPANY


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                           RESULTS COMPENSATION PROGRAM


       In 1996, the Results Compensation program initiated in 1994 is being
       continued.  This program has significantly enhanced the Corporation's
       compensation philosophy and practice.

       The Results Compensation program is designed to recognize and reward the
       contribution that group performance makes to corporate success when
       budgeted goals are met.  Results Compensation can pay financial rewards
       up to 8 percent of your earnings.


       GROUP PERFORMANCE

       There are several elements that go into determining the success of the
       Corporation.  Some of these elements include: the contributions
       employees make to achieve goals; both on an individual basis and as part
       of a work unit, in addition to the market, general economic conditions,
       quality of management, strategic plans, and regulatory agencies.

       In general, the current merit/base pay system provides individual pay
       opportunities that are competitive in our respective industry and
       geographic location coupled with each company's ability to pay.  The
       emphasis of the Results Compensation program is an added incentive to
       reward group or business unit performance.


       RESULTS COMPENSATION PROGRAM OBJECTIVES

       The Results Compensation program is designed to meet the following
       objectives:

          *   Enhance and broaden the current compensation philosophy and pay
              practice.

          *   Share the results of the Corporation and the business unit with
              the people who contribute to that success.

          *   Motivate work  performance and behavior that supports the
              Corporate and business unit financial goals.

          *   Increase the employee's understanding of the business.
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       RESULTS COMPENSATION GUIDELINES


          *   The program encompasses a one-year period; January 1, 1996,
              through December 31, 1996.  Results Compensation awards, if
              earned and approved, will be paid out in the first quarter of the
              following year.

          *   Regular full-time and regular part-time employees are eligible to
              participate in this program.

          *   An individual employee's Results Compensation award, if any, will
              be paid on gross pay as it appears on the employee's W-2 form.
              This includes regular, overtime, paid time off and other forms of
              premium pay.

          *   An employee who transfers between one of the participating
              companies (BHP, WRDC, WPC, or BHC) during the program year will
              have the Results Compensation award, if approved, based upon
              where the greatest amount of time worked occurred.

          *   The local union IBEW, 1250, elected not to participate in the
              1996 Results Compensation program.

          *   Since the bargaining unit does not participate, an employee who
              transfers to or from a bargaining unit position will receive a
              pro-rated Results Compensation award, if approved, relative to
              the amount of time worked in the non-bargaining unit position and
              gross pay earned in the non-bargaining unit position while
              qualified under the program.

          *   The maximum Results Compensation bonus and award an employee may
              receive is 8 percent.

          *   In determining the bonus percentage to be paid, calculations will
              be rounded to two decimal places (e.g., 1.43%) not rounded to the
              nearest whole percentage amount.

          *   Any participating employee whose employment relationship with the
              Corporation is terminated voluntarily or involuntarily prior to
              the end of the program year will not be eligible for any Results
              Compensation award.  Exceptions would be death, permanent
              disability or retirement.
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       DETERMINING RESULTS COMPENSATION AWARDS


       The Results Compensation program has two key financial goals.  The
       financial goals consist of a business unit goal and a corporate goal.
       Whether a program award is paid and how much any award will be depends
       on how well and to what degree the goals were obtained as evaluated by
       the Board of Directors.

          GOAL 1. FINANCIAL PERFORMANCE OF THE INDIVIDUAL BUSINESS UNIT (BHP,
                 WRDC, WPC) BASED ON OPERATING INCOME.

          Operating income is all business unit revenue, less operating
          expense, before corporate income taxes and interest charges.  This
          measures the financial results of operations.

          Participants may receive up to four percent of their total Results
          Compensation award from this goal; specifics are attached.

          GOAL 2. CORPORATE CONSOLIDATED EARNINGS PER SHARE (EPS) GOAL.

          Earnings Per Share are equal to the total consolidated profit divided
          by the number of shares of Black Hills Corporation common stock owned
          by shareholders.

          Participants may receive up to four percent of their total Results
          Compensation award from the goal.  Since this is a consolidated
          Corporate goal, all employees in the different business units will
          have the same goal.  The specific target goal for 1996 is $1.83 as
          shown in the attached.

          In 1994, the EPS base was established at $1.66.  That base was
          increased by 5% in 1995 to last year's target of $1.743 EPS.
          Consistent with that goal, the EPS target for 1996 has again been
          increased by 5% to the new target goal of $1.83 for 1996.
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       BOARD OF DIRECTORS RETAIN DISCRETION


       This program is not at any time a contract of employment.  The Company
       reserves the right to change this program whenever and in any manner it
       deems appropriate.  Irrespective of changes in the program, no rights
       are vested.  All awards are earned only when and if finally approved by
       the Board of Directors notwithstanding anything contained in the program
       that may be construed to be to the contrary.

       The Board of Directors, in its sole and absolute discretion, may decline
       to approve any award, though the participant may have achieved or
       exceeded threshold and target levels of performance.  Setting a
       threshold or target of performance for any participants does not
       constitute a promise to pay an award even if the participant meets the
       threshold or target of performance.  In determining whether to make an
       award and the amount of the award, the Board of Directors may consider
       criteria other than or in addition to the threshold and target
       performance determined under this program.  Nothing in this program is a
       promise by the Corporation to continue to employ any participant for any
       period of time.