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                                                                    EXHIBIT 99.1

                                                          Exhibit A

Media Contact:

James A. Grasso
V.P., Public & Government Affairs
ProvEnergy
(401) 272-5040, Ext. 2340


FOR IMMEDIATE RELEASE


       DIVISION OF PUBLIC UTILITIES REJECTS ALLEGATIONS OF PREFERENTIAL 
                  TREATMENT OF PROVENERGY MARKETING AFFILIATE


PROVIDENCE, R.I., September 2, 1998: Providence Energy Corporation
("ProvEnergy") (NYSE: PVY) announced today that the Rhode Island Division of
Public Utilities and Carriers (the "Division") yesterday rejected the
allegations of Aurora Natural Gas that ProvEnergy's local gas distribution
company, Providence Gas Company ("ProvGas"), provided advance information and
undue preference in pricing to its marketing affiliate, Providence Energy
Services ("PES"), in violation of state rules regarding deregulation.  James H.
Dodge, the chairman, president and CEO of ProvEnergy, noted that "the Division
determined that there was no evidence of preferential treatment, advance
knowledge or misuse of ProvGas' electronic bulletin board as alleged by Aurora."

However, the Division fined ProvGas a total of $23,000 for what it claims were
23 other violations of its rules.  ProvEnergy strongly disagrees with the
Division's position and will challenge all of the alleged violations, many of
which are minor and technical.  For example, 13 of these alleged violations
concerned the receipt of a monthly ProvGas marketing report by a Providence
Energy Corporation employee -- one violation for each month he saw the report.
However, the Division ruled only that the employee should not have seen the
report, not that there was any misuse of the information, as was alleged by
Aurora.  Five alleged violations concerned what the Division claimed were joint
marketing activities between ProvGas and PES; two violations concerned a
"shared" logo  between ProvEnergy and PES; and one violation described a single
instance when weather service information was provided to PES.  However, it
should be noted that the September 2, 1998 edition of Gas Daily stated that the
Division's Hearing Officer Stephen Scialabba "emphasized that he didn't believe
[ProvGas] was purposely attempting to disregard regulations."

In addition to the fines, the Division ordered a rate refund of $292,000 to
marketers that buy natural gas on the national market and sell it to Rhode
Island commercial and industrial customers, using ProvGas to transport the gas.
The Division claimed that ProvGas should have refused to provide such service
for 571 customers that did not have telemeters in place.  It 
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claimed that providing service without meters resulted in an unfair rate to
these businesses. ProvGas believes that it would have been irresponsible to have
refused transportation service to the 571 businesses involved.

ProvGas made it clear -- in advance -- to all natural gas marketers, as well as
to the Division, that it was impossible to install the necessary meters at the
outset of its business unbundling program due to the overwhelming, and
unexpected, response.  Instead, ProvGas instituted an interim service based on
estimates of usage until the metering systems were installed.  ProvGas believes
it has this right under the PUC's rules and ProvGas' tariff.

ProvGas asserts that the Division's order is unwarranted and that it intends to
appeal and vigorously pursue all options in order to reverse the ruling.

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