SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-K

                  ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended    September 30, 1998 Commission file number 0-367


                               ROANOKE GAS COMPANY
-------------------------------------------------------------------------------

             (Exact name of registrant as specified in its charter)


             Virginia                                     54-0359895
-------------------------------------         ---------------------------------
  (State or other jurisdiction of                      (I.R.S. Employer
  incorporation or organization)                      Identification No.)



    519 Kimball Ave., N.E., Roanoke, VA                      24016
-----------------------------------------     ---------------------------------
 (Address of principal executive offices)                  (Zip Code)


Registrant's telephone number, including area code    (540) 777-4427
                                                   ----------------------------

Securities registered pursuant to Section 12(b) of the Act:           None

Securities registered pursuant to Section 12(g) of the Act:

                                                   Name of Each Exchange on
      Title of Each Class                              Which Registered
----------------------------------            ---------------------------------
                                                          OTC (Nasdaq
   Common Stock, $5 Par Value                          National Market)
----------------------------------            ---------------------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.   Yes X    No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (Section 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [ ]


<PAGE>




State the aggregate market value of the voting stock held by nonaffiliates
of the registrant as of November 27, 1998.       $38,743,495

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the last practicable date.

               Class                          Outstanding at November 27, 1998
--------------------------------------    -------------------------------------
     COMMON STOCK, $5 PAR VALUE                       1,802,023 SHARES


DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the Roanoke Gas Company 1998 Annual Report to Shareholders are
incorporated by reference into Parts II and IV hereof.

Portions of the Proxy Statement for the 1999 Annual Meeting of Shareholders of
Roanoke Gas Company are incorporated by reference into Part III hereof.



<PAGE>



                                     PART I

Item 1.    Business.

           Historical Development

           Roanoke Gas Company ("Roanoke Gas") was organized as a public service
           corporation under the laws of the Commonwealth of Virginia in 1912.
           The principal service of Roanoke Gas was, and continues to be, the
           distribution and sale of natural gas. Commencing in 1972, the
           distribution and sale of propane gas was added to Roanoke Gas' line
           of business. The propane business was transferred to Diversified
           Energy Company, d/b/a Highland Propane Company ("Diversified"), in
           January 1979. Diversified, which is not a public utility, distributes
           and sells propane in Southwestern Virginia and Southern West
           Virginia.

           On May 15, 1987, Roanoke Gas, through a series of merger
           transactions, acquired 100 percent of the outstanding stock of
           Bluefield Gas Company ("Bluefield"), a public service corporation,
           organized in 1944 under the laws of the State of West Virginia and
           principally engaged in the distribution of natural gas in Bluefield,
           West Virginia and surrounding areas, and Gas Service, Inc. ("Gas
           Service"), a nonpublic utility affiliate (through common directors
           and shareholders) of Bluefield, which was engaged in the sale of
           propane in southwestern Virginia and southern West Virginia. After
           obtaining requisite shareholder approval and the approvals of the
           Virginia State Corporation Commission ("Virginia Commission") and the
           West Virginia Public Service Commission ("West Virginia Commission"),
           Gas Service was merged into Diversified, and Bluefield became a
           wholly-owned subsidiary of Roanoke Gas. Bluefield owns all of the
           issued and outstanding stock of Commonwealth Public Service
           Corporation ("Commonwealth"), a small Virginia public service
           corporation organized in 1930 as the subsidiary of a predecessor
           corporation to Bluefield.

           In March 1994, the Highland Gas Marketing division of Diversified was
           established to broker natural gas to several industrial
           transportation customers of Roanoke Gas and Bluefield Gas.

           On September 28, 1998, Roanoke Gas' Board of Directors approved a
           proposal to reorganize Roanoke Gas into a holding company structure
           in which Roanoke Gas shareholders would become shareholders of a new
           holding company called RGC Resources, Inc. ("Resources"). As a result
           of the reorganization: (i) Resources would become a holding company
           owned by the former shareholders of Roanoke Gas; (ii) Resources would
           become the sole owner of the stock of Roanoke Gas, Bluefield and
           Diversified; (iii) Commonwealth's natural gas distribution business
           would be merged into Roanoke Gas; (iv) Roanoke Gas and Bluefield
           would continue to carry


                                        3

<PAGE>




Item 1.    Business. (continued)

           Historical Development (continued)

           on a natural gas distribution business as a subsidiary of Resources;
           and (v) Diversified would continue to carry on its nonutility propane
           business as a subsidiary of Resources.

           On October 16, 1998, Roanoke Gas and Resources have filed a joint
           application with the Securities and Exchange Commission requesting
           approval of the reorganization under Section 10 of the Federal Public
           Utility Holding Company Act of 1935. Resources intends, upon
           consummation and reorganization to file a claim of exemption from all
           provisions of that Act (except with respect to certain acquisitions
           and investments) on the basis that Resources and its material public
           utility subsidiaries are predominantly intrastate in character. Both
           the Virginia Commission and the West Virginia Commission must approve
           or consent to the reorganization. On October 21, 1998, the Company
           filed with the Virginia and West Virginia Commissions applications
           for authorization to undertake the holding company restructuring.
           Such applications currently are pending in both states. The
           reorganization also requires the approval of more than two-thirds of
           the outstanding shares of Roanoke Gas common stock. There can be no
           assurance that Roanoke Gas and Resources will obtain all required
           regulatory or other approvals, or that such approvals will be granted
           on terms acceptable to Roanoke Gas. Detailed information regarding
           the proposed reorganization is set out in Roanoke Gas' Proxy
           Statement for its 1999 Annual Meeting of Shareholders.

           Forward-Looking Statements

           From time to time, Roanoke Gas and its subsidiaries (together, the
           "Company") may publish forward-looking statements relating to such
           matters as anticipated financial performance, business prospects,
           technological developments, new products, research and development
           activities and similar matters. The Private Securities Litigation
           Reform Act of 1995 provides a safe harbor for forward-looking
           statements. In order to comply with the terms of the safe harbor, the
           Company notes that a variety of factors could cause the Company's
           actual results and experience to differ materially from the
           anticipated results or other expectations expressed in the Company's
           forward-looking statements. The risks and uncertainties that may
           affect the operations, performance, development and results of the
           Company's business include the following: (i) obtaining adequate rate
           relief from regulatory authorities on a timely basis; (ii) earning an
           adequate return on invested capital; (iii) increasing expenses and
           labor costs and availability; (iv) price competition from alternate
           fuels; (v) volatility in the price of natural gas and propane; (vi)
           some uncertainty in the


                                        4

<PAGE>



Item 1.    Business. (continued)

           Forward-Looking Statements (continued)

           projected rate of growth of natural gas and propane requirements in
           the Company's service area; (vii) general economic conditions both
           locally and nationally; and (viii) developments in electricity and
           natural gas deregulation and associated industry restructuring. In
           addition, the Company's business is seasonal in character and
           strongly influenced by weather conditions. Extreme changes in winter
           heating degree days from the normal or mean can have significant
           short-term impacts on revenues and gross margin. Management of the
           Company believes that the Company has the resources to deal
           successfully with these issues.

           Services

           The Company maintains an integrated natural gas distribution system.
           Natural gas is purchased from suppliers and distributed to
           residential, commercial and large industrial users through
           underground mains and services. Approximately 90.1 percent of the
           Company's customers are residential, approximately 9.8 percent are
           small commercial users, and the remaining percentage is made up of
           large industrial customers, who received approximately 28 percent of
           the Company's total annual delivered volume in 1998 under the
           Company's interruptible tariff and transportation gas services.

           The Company's natural gas distribution business accounted for
           approximately 87 percent of the total revenues generated by the
           Company in fiscal 1998, and approximately 89 percent and
           approximately 91 percent of the Company's total revenues in fiscals
           1997 and 1996, respectively. The Company's revenues are affected by
           the cost of natural gas, economic conditions in the areas that the
           Company serves and weather conditions. Higher gas costs, which the
           Company is generally able to pass through to customers, may cause
           customers to conserve, or in the case of industrial customers, to use
           alternative energy sources. In recent years, regulatory changes at
           the federal level and excess supply in the natural gas industry
           have led to a national spot market for natural gas and an increase
           in the number of suppliers of natural gas.

           The Company's retail sales are seasonal and temperature-sensitive as
           the majority of the gas sold by the Company is used for heating. For
           the fiscal year ended September 30, 1998, more than 53 percent of the
           Company's total MCF of natural gas sales were made in the four-month
           period of December through March. Retail gas deliveries for fiscal
           1998 were 10,875,481 MCF, as compared to 10,804,045 MCF and
           11,169,948 MCF in fiscals 1997 and 1996, respectively. The Company's
           actual heating degree days in fiscal 1998 were approximately 96
           percent of normal, as compared with

                                        5

<PAGE>




Item 1.    Business. (continued)

           Services (continued)

           approximately 102 percent of normal in fiscal 1997 and approximately
           111 percent of normal in fiscal 1996.

           Suppliers

           Effective November 1, 1993, the natural gas transportation pipelines
           supplying the Company, including Columbia Gas Transmission
           Corporation and Columbia Gulf Transmission Corporation (together
           "Columbia") and East Tennessee Natural Gas Company and Tennessee Gas
           Pipeline (together "East Tennessee"), have operated under Federal
           Energy Regulatory Commission ("FERC") Order 636. Order 636 was the 
           start of a new era in the natural gas industry when the 
           responsibility of gas supply procurement and management was shifted
           from the pipeline companies to the local distribution companies and
           to other "shippers" of natural gas.

           The cornerstone of Order 636 was the "unbundling" of pipeline
           services to provide a number of choices to shippers. The Company now
           chooses who it buys its gas from, how much storage gas to purchase, 
           how much transportation capacity to keep and how much to release. The
           Company constantly monitors its gas requirements to minimize exposure
           to pipeline penalties for insufficient supplies or excessive gas
           injections. The Company's "shipper" responsibilities bring increased 
           scrutiny from the state commissions as they monitor the Company's gas
           purchasing practices to assure that a "least cost with adequate 
           reliability" policy is followed. Accordingly, the Company has worked 
           diligently to ensure that its customers will have an economical and 
           reliable gas supply. Management believes the relationships the 
           Company has built with its suppliers as it constructed a supply 
           portfolio will allow it to continue to attain this goal.

           The Company currently uses long-term (multi-year), mid-term
           (seasonal) and short-term (spot) gas purchases to meet its system
           requirements. The Company has entered into, or is in the process of
           entering into, long-term and mid-term firm supply agreements to cover
           the majority of its firm demand. Long-term and mid-term suppliers
           currently include Amoco Energy Trading, Columbia Energy Services,
           Cabot Oil and Gas, Coral Energy, Engage Energy and Southern Company
           Energy Marketing.

           The Company's firm supply agreements may supply up to 9,691,000 DTH
           of natural gas at varying prices during the period October 1, 1998
           through September 30, 1999.


                                        6

<PAGE>




Item 1.    Business. (continued)

           Suppliers (continued)

           With the growth of the spot gas market, gas prices have developed a
           pronounced seasonal pattern, with summer to winter price swings of
           100 percent or more. The Company tries to take advantage of this
           opportunity by injecting lower-priced summer gas into its liquefied
           natural gas storage facility, which is capable of storing up to
           220,000 DTH for use during peak winter periods. In addition, the
           Company has contracted for storage reserves from Columbia, Tennessee
           Gas pipeline and Virginia Gas Storage Company, with a combined total
           of 2,738,631 DTH of underground storage capacity for Roanoke and 
           Bluefield. These reserves were available for summer 1998 storage
           injections using spot market supply. This storage capacity provides
           supply security with reduced exposure to potential supply
           interruptions. It also offers the Company the flexibility to balance
           supply with its highly variable, weather-sensitive customer
           consumption patterns. In addition, the Company participates in
           pipeline capacity release programs to further minimize the cost of
           firm service to its customers by reselling pipeline capacity not
           needed during the warmer months.

           Columbia continues to be the Company's primary transporter of natural
           gas. Columbia historically has delivered approximately two-thirds of
           Roanoke Gas' gas supply and 100 percent of Bluefield's gas supply.
           The Company currently has another pipeline connection under
           construction to serve the Bluefield location. East Tennessee
           continues to be the Company's other major source of supply.
           Historically, East Tennessee has delivered approximately one-third of
           the Company's natural gas supply to the Roanoke location. The rates
           paid for natural gas transportation and storage services purchased
           from Columbia and East Tennessee are established by tariffs approved
           by the FERC. These tariffs contain flexible pricing provisions,
           which, in some instances, authorize these suppliers to reduce rates
           and charges to meet price competition.

           Having two major pipeline transporters, a shaving facility and a
           number of underground storage options, the Company believes that it
           is well positioned to provide adequate gas supply for future customer
           growth. The Company has been, and intends to continue to be, flexible
           and creative as it markets its own transportation capacity and makes
           its gas purchasing decisions. The Company believes that Order 636 
           provides regulatory stability. Additionally, the increased 
           opportunities available in a deregulated natural gas supply 
           environment may result in additional market forces that establish 
           gas prices and help keep them more consistent and competitive.


                                        7

<PAGE>



Item 1.    Business. (continued)

           Suppliers (continued)

           Diversified has entered into storage and purchase contracts for a
           substantial portion of its winter supply of propane. At September 30,
           1998, Diversified has contracts with five propane suppliers for the
           purchase of up to 6,060,500 gallons of propane at varying prices per
           gallon during the period October 1, 1998 through September 30, 1999.
           Management believes these storage and purchase contracts will help
           alleviate the effects of wholesale price swings during peak sales
           months and provide added supply security.

           In addition to storage contracts, Diversified has 12 storage
           facilities, providing a combined total storage of 504,000 gallons.
           Management believes its propane supply strategies have positioned
           Diversified to provide an adequate propane supply to current 
           customers and allow for future customer growth.

           Competition

           The Company competes with other energy sources such as fuel oil,
           electricity and coal. Competition is intense among the competing
           energy sources and is based primarily on price. This is particularly
           true for industrial applications where sales are at risk to price
           competition in markets which may swing to residual and other fuel
           oils.

           Roanoke Gas and Commonwealth currently hold the only franchises
           and/or certificates of public convenience and necessity to distribute
           natural gas in their respective Virginia service areas. The
           franchises generally extend for multi-year periods and are renewable
           by the municipalities. Certificates of public convenience and
           necessity, which are issued by the Virginia Commission, are of
           perpetual duration, subject to compliance with regulatory standards.

           Bluefield Gas Company holds the only franchise to distribute natural
           gas in its West Virginia service area. Its franchise extends for a
           period of 30 years from August 23, 1979.

           Management anticipates that the Company will be able to renew all of
           its franchises when they expire. There can be no assurance, however,
           that a given jurisdiction will not refuse to renew a franchise or
           will not, in connection with the renewal of a franchise, impose
           certain restrictions or conditions that could adversely affect the
           Company's business operations or financial condition.


                                        8

<PAGE>



Item 1.    Business. (continued)

           Regulation

           Roanoke Gas and its public service subsidiaries are subject to
           regulation at federal and state levels. Federally, the interstate gas
           transmission between Bluefield and Commonwealth is regulated by the
           FERC. At the state level, the Virginia and West Virginia Commissions
           regulate Roanoke Gas and its public service subsidiaries. Such
           regulation includes the prescription of rates and charges at which
           natural gas is sold to customers and the approval of agreements
           between or among affiliated companies involving the provision of
           goods and services and other corporate activities of the Company,
           including mergers, acquisitions and the issuance of securities. The
           Virginia Commission also grants certificates of public convenience
           and necessity to distribute natural gas in counties in the
           Commonwealth of Virginia. Bluefield's West Virginia operations are
           regulated by the West Virginia Commission, which regulates the rates
           at which natural gas may be sold, certain corporate activities of
           Bluefield and pipeline safety.

           Roanoke Gas' and its public service subsidiaries' Virginia and West
           Virginia operations are further regulated by the municipalities and
           localities which grant franchises for the placement of gas
           distribution pipelines and the operation of a gas distribution
           network.

           Both Roanoke Gas and Bluefield operated manufactured gas plants
           (MGPs) as a source of fuel for lighting and heating until the early
           1950's. A by-product of the process was coal tar, and the potential
           exists for on-site tar waste contaminants at former plant sites. The
           extent of contaminants at these sites, if any, is unknown at this
           time. An analysis at the Bluefield site indicates some soil
           contamination. The Company, with concurrence of legal counsel, does
           not believe any events have occurred requiring regulatory reporting.
           Further, the Company has not received any notices of violation or
           liabilities associated with environmental regulations related to the
           MGP sites and is not aware of any off-site contamination or pollution
           as a result of prior operations. Therefore, the Company has no plans
           for subsurface remediation at the MGP sites. Should the Company
           eventually be required to remediate either site, the Company will
           pursue all prudent and reasonable means to recover any related costs,
           including insurance claims and regulatory approval for rate case
           recognition of expenses associated with any work required. A
           stipulated rate case agreement between the Company and the West
           Virginia Public Service Commission recognized the Company's right to
           defer MGP clean-up costs at the Bluefield site, should any be
           incurred, and to seek rate relief for such costs. If the Company
           eventually incurs costs associated with a required clean-up of either
           MGP site, the Company anticipates recording a regulatory asset for
           such clean-up costs to be recovered in future rates. Based on
           anticipated regulatory actions and current practices, management
           believes

                                        9

<PAGE>




Item 1.    Business. (continued)

           Regulation (continued)

           that any costs incurred related to this matter will not have a
           material effect on the Company's consolidated financial condition.

           Employees

           At September 30, 1998, the Company had 158 full-time employees. As of
           that date, approximately 32 percent of the Company's full-time
           employees belonged to the Oil, Chemical and Atomic Workers
           International Union, AFL-CIO Local No. 3-515, which has entered into
           a collective bargaining agreement with the Company. The union has
           been in place at the Company since 1952. A new collective bargaining
           agreement became effective on August 1, 1998. That agreement will
           expire on July 31, 2000. The Company considers its employee relations
           to be satisfactory.

Item 2.    Properties.

           Roanoke Gas owns and operates five metering stations through which it
           measures and regulates the gas being delivered by its suppliers. The
           location and physical description of the properties are as follows:

           Plantation Station - Parcel on Virginia Highway #601 near point of 
           intersection of Hershberger Road (Rt. 623) and Rt. 601 - 1.590 acres.

           J. M. Mason Station - S/E corner of Lakeside Circle and east of Lot
           #4 of Mill Road subdivision just east of Kessler Mill Road - .842
           acres.

           Sugarloaf Station - Parcel fronting on S/L of Rt. 686 and W/L of
           Lynnson Drive - 111 acres.

           Clearbrook Station - Parcel 356' west of Rt. 675 and 0.2 mile south 
           of Rt. 220 - 255 acres.

           Cave Spring Station - N/L Route 221 just west of Route 688 - 3.93
           acres.

           The network of distribution lines includes the cities of Roanoke and
           Salem, the Town of Vinton, and the counties of Roanoke, Montgomery,
           Botetourt and Bedford.

           Located in Botetourt County is a liquefied natural gas storage
           facility which has the capacity to hold 220,000 DTH of natural gas.
           The County issued Industrial Revenue Bonds to finance this facility.
           Roanoke Gas had a twenty-year lease on the facility

                                       10

<PAGE>




Item 2.    Properties. (continued)

           with the option to purchase for a nominal amount. The lease expired
           May 1, 1991, and the facility was purchased by Roanoke Gas.

           Roanoke Gas' general and business offices and the maintenance and 
           service departments are located in Roanoke, Virginia on an 
           irregularly shaped parcel of land running from H. L. Lawson and Son, 
           Inc. south to Norfolk Southern Computer Center fronting on Kimball 
           Avenue to the west to the Norfolk Southern Railway yard.  The land 
           area is 8.3 acres.

           Bluefield Gas Company's main corporate office and warehouse is
           located on 6.09 acres at 4699 East Cumberland Road and consists of a
           one-story metal building with brick front. Bluefield owns a lot at
           800 Pulaski Street, Bluefield, West Virginia. In addition, Bluefield
           owns two lots in the City of Bluefield, West Virginia, comprising
           approximately 1.23 acres, upon which its high pressure regulator
           stations are located.

           In West Virginia, Diversified owns an office, loading platform,
           garage and storage tank facility in Rainelle. The storage facility
           consists of two 18,000-gallon tanks, pumps and related equipment. A
           30,000 gallon storage facility is also located in Ansted.

           Another storage facility, comprising two 30,000 gallon tanks, one
           18,000-gallon tank, pumps and related equipment, is located on
           Bluefield Gas Company's property at 800 Pulaski Street, Bluefield,
           West Virginia.

           In Virginia, Diversified owns and operates nine storage facilities. A
           facility at Thirlane Road, N.W. in Roanoke consists of two 30,000
           gallon tanks. A second facility at Fort Chiswell, Virginia consists
           of two 30,000 gallon tanks. The third facility is located on the
           property of Consolidated Glass in Galax, Virginia and consists of one
           30,000 gallon tank. A fourth storage facility is located in Craig
           County, Virginia, near the town of New Castle, and also consists of
           one 30,000 gallon tank. A fifth facility located in Floyd County,
           Virginia consists of one 30,000 gallon tank. A sixth facility is
           located on the property of Virginia Forging in Botetourt County, near
           the town of Buchanan, and consists of one 30,000 gallon tank. A
           seventh facility is located on the property of Golden West Foods in
           the City of Bedford and consists of one 30,000 gallon tank. An eighth
           facility is located in the City of Buena Vista and consists of two
           30,000 gallon tanks. A ninth facility is located in Allegheny County
           near the town of Low Moor and consists of one 30,000 gallon tank.

           The Company considers present properties adequate. The Company
           intends to construct additional distribution lines as communities
           develop.

                                       11

<PAGE>




Item 3.    Legal Proceedings.

           Not applicable.

Item 4.    Submission of Matters to a Vote of Security Holders.

           There were no matters submitted to a vote of security holders during
           the fourth quarter of the year ended September 30, 1998.

           Executive Officers of the Registrant

           Pursuant to General Instruction G(3) of Form 10-K, the following list
           is included as an unnumbered Item in Part I of this report in lieu of
           being included in the proxy Statement for the Annual Meeting of
           Stockholders to be held on March 31, 1999.

           The names, ages and positions of all of the executive officers of
           Roanoke Gas as of September 30, 1998 are listed below with their
           business experience for the past five years. Officers are appointed
           annually by the Board of Directors at the meeting of directors
           immediately following the Annual Meeting of Stockholders. There are
           no family relationships among these officers, nor any agreement or
           understanding between any officer and any other person pursuant to
           which the officer was selected.

           Previous and present duties and responsibilities:
<TABLE>
<CAPTION>

                               Position and Business
Name and Age                   Experience for Past Five Years
<S>     <C>    <C>    <C>    <C>    <C>    <C>

John B. Williamson, III, 44    February 1998 to present         President & CEO

                               January 1993 to January 1998     Vice President - Rates
                                                                    and Finance

                               April 1992 to January 1993       Director of Rates and Finance

Arthur L. Pendleton, 47        February 1998 to present         Executive Vice President
                                                                    & COO

                               January 1991 to January 1998     Vice President - Operations

Roger L. Baumgardner, 56       January 1986 to present          Vice President, Secretary and
                                                                    Treasurer



                                       12

<PAGE>




Item 4.    Submission of Matters to a Vote of Security Holders.

           Executive Officers of the Registrant (continued)

John S. D'Orazio, 38           February 1998 to present         Vice President - Marketing
                                                                    & New Construction

                               June 1995 to January 1998        Director - Marketing & New
                                                                    Construction

                               February 1995 to June 1995       Service Superintendent

                               June 1993 to February 1995       Distribution Superintendent

</TABLE>


                                       13

<PAGE>



                                     PART II

Item 5.        Market for Registrant's Common Equity and Related Stockholder 
               Matters.

               The information set forth under the caption "Market Price and
               Dividend Information" in the 1998 Annual Report to Shareholders
               is incorporated herein by reference.

Item 6.        Selected Financial Data.

               The information set forth under the caption "Selected Financial
               Data" in the 1998 Annual Report to Shareholders is incorporated
               herein by reference.

Item 7.        Management's Discussion and Analysis of Financial Condition and
               Results of Operations.

               The information set forth under the captions "Review of
               Operations" and "Management's Discussion and Analysis of
               Financial Condition and Results of Operations" in the 1998 Annual
               Report to Shareholders is incorporated herein by reference.

Item 7A.       Quantitative and Qualitative Disclosures About Market Risk.

               Not applicable.

Item 8.        Financial Statements and Supplementary Data.

               The following consolidated financial statements of the registrant
               and the Independent Auditors' Report set forth in the 1998 Annual
               Report to Shareholders are incorporated herein by reference:

               1.     Independent Auditors' Report

               2.     Consolidated Balance Sheets as of September 30, 1998 and 
                      1997

               3.     Consolidated Statements of Earnings for the Years Ended
                      September 30, 1998, 1997 and 1996

               4.     Consolidated Statements of Stockholders' Equity for the
                      Years Ended September 30, 1998, 1997 and 1996

               5.     Consolidated Statements of Cash Flows for the Years Ended
                      September 30, 1998, 1997 and 1996

                                       14

<PAGE>




               6.     Notes to Consolidated Financial Statements as of September
                      30, 1998 and 1997 and Years Ended September 30, 1998, 1997
                      and 1996

Item 9.        Changes in and Disagreements with Accountants on Accounting and
               Financial Disclosure.

               At its meeting on July 28, 1997, the Board of Directors of
               Roanoke Gas Company (the "Company"), upon recommendation of the
               Audit Committee, appointed Deloitte & Touche LLP as independent
               accountants to audit the financial statements of the Company and
               its subsidiaries for the years ending September 30, 1998, 1999
               and 2000. KPMG Peat Marwick LLP ("KPMG") previously had served as
               the Company's certifying accountants since 1990. The Board of
               Directors solicited competitive bids from accountants interested
               in serving as the Company's auditor. From the bids received, the
               Audit Committee recommended Deloitte & Touche LLP to the Board of
               Directors. KPMG's engagement terminated after completion of the
               1997 audit.

               KPMG's auditors' reports on the Company's financial statements
               for the two fiscal years ended September 30, 1997 contained no
               adverse opinion or a disclaimer of opinion, nor were they
               qualified or modified as to uncertainty, audit scope, or
               accounting principles. During Roanoke Gas Company's fiscal years
               ending September 30, 1997 and 1996, there were no disagreements
               with KPMG on any matter of accounting principles or practices,
               financial statement disclosure, or auditing scope or procedure
               which, if not resolved to the satisfaction of KPMG, would have
               caused it to make a reference to the subject matter of the
               disagreement in connection with its auditors' reports.

                                    PART III

Item 10.       Directors and Executive Officers of the Registrant.

               For information with respect to the executive officers of the
               registrant, see "Executive Officers of the Registrant" at the end
               of Part I of this report. For information with respect to the
               Directors of the registrant, see "Election of Directors of
               Roanoke Gas" in the Proxy Statement/Prospectus for the 1999
               Annual Meeting of Shareholders of Roanoke Gas Company, which
               information is incorporated herein by reference. The information
               with respect to compliance with Section 16(a) of the Exchange
               Act, which is set forth under the caption "Section 16(a)
               Beneficial Ownership Reporting Compliance" in the Proxy
               Statement/Prospectus for the 1999 Annual Meeting of Shareholders
               of Roanoke Gas Company, is incorporated herein by reference.


                                       15

<PAGE>



Item 11.       Executive Compensation.

               The information set forth under the captions "Executive
               Compensation," "Report of the Compensation Committee of the Board
               of Directors," "Compensation Committee Interlocks and Insider
               Participation" and "Performance Graph" in the Proxy
               Statement/Prospectus for the 1999 Annual Meeting of Shareholders
               of Roanoke Gas Company, is incorporated herein by reference.

Item 12.       Security Ownership of Certain Beneficial Owners and Management.

               The information pertaining to shareholders beneficially owning
               more than five percent of the registrant's common stock and the
               security ownership of management, which is set forth under the
               captions "The Annual Shareholders Meeting" and "Security
               Ownership of Management" in the Proxy Statement/Prospectus for
               the 1999 Annual Meeting of Shareholders of Roanoke Gas Company,
               is incorporated herein by reference.

Item 13.       Certain Relationships and Related Transactions.

               The information with respect to certain transactions with
               management of the registrant, which is set forth under the
               caption "Transactions with Management" in the Proxy
               Statement/Prospectus for the 1999 Annual Meeting of Shareholders
               of Roanoke Gas Company, is incorporated herein by reference.

                                       16

<PAGE>



                                     PART IV

Item 14.   Exhibits, Financial Statement Schedules and Reports on Form 8-K.

           (a) List of documents filed as part of this report:

                  1.  Financial statements:

                      All financial statements of the registrant as set forth
                      under Item 8 of this Report on Form 10-K.

                  2. Financial statement schedules:

                      All schedules are omitted, as the required information is
                      inapplicable or the information is presented in the
                      consolidated financial statements or related notes
                      thereto.

                  3. Exhibits to this Form 10-K are as follows:

             Exhibit No.       Description

                3 (a)          Articles of Incorporation, as amended, of
                               Roanoke Gas Company (incorporated herein by
                               reference to Exhibit 3(a) of the Annual Report on
                               Form 10-K for the fiscal year ended September 30,
                               1997)

                3 (b)          Bylaws, as amended, of Roanoke Gas Company
                               (incorporated herein by reference to Exhibit 3(b)
                               of the Annual Report on Form 10-K for the fiscal
                               year ended September 30, 1997)

                4 (a)          Specimen copy of certificate for Roanoke Gas
                               Company common stock, $5.00 par value
                               (incorporated herein by reference to Exhibit 4(a)
                               of the Annual Report on Form 10-K for the fiscal
                               year ended September 30, 1992)

                4  (b)         Article I of the Bylaws of Roanoke Gas Company 
                               (included in Exhibit 3(b) hereto)

                4  (c)         Instruments defining the rights of holders of
                               long-term debt (incorporated herein by reference
                               to Exhibit 4(c) of the Annual Report on Form 10-K
                               for the fiscal year ended September 30, 1991)


                                       17

<PAGE>



                10 (a)         Firm Transportation Agreement between East
                               Tennessee Natural Gas Company and Roanoke Gas
                               Company dated November 1, 1993 (incorporated
                               herein by reference to Exhibit 10(a) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (b)         Interruptible Transportation Agreement
                               between East Tennessee Natural Gas Company and
                               Roanoke Gas Company dated July 1, 1991
                               (incorporated herein by reference to Exhibit
                               10(b) of the Annual Report on Form 10-K for the
                               fiscal year ended September 30, 1994)

                10 (c)         NTS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated October 25, 1994 (incorporated herein by
                               reference to Exhibit 10(c) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (d)         SIT Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 30, 1993 (incorporated herein by
                               reference to Exhibit 10(d) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (e)         FSS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(e) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (f)         FTS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(f) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (g)         SST Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(g) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)


                                       18

<PAGE>



                10 (h)         ITS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(h) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (i)         FTS-1 Service Agreement between Columbia Gulf
                               Transmission Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(i) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (j)         ITS-1 Service Agreement between Columbia Gulf
                               Transmission Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(j) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (k)         Gas Transportation Agreement, for use under
                               FT-A rate schedule, between Tennessee Gas
                               Pipeline Company and Roanoke Gas Company dated
                               November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(k) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (l)         Gas Transportation Agreement, for use under
                               IT rate schedule, between Tennessee Gas Pipeline
                               Company and Roanoke Gas Company dated September
                               1, 1993 (incorporated herein by reference to
                               Exhibit 10(l) of the Annual Report on Form 10-K
                               for the fiscal year ended September 30, 1994)

                10 (m)         Gas Storage Contract under rate schedule FS
                               (Production Area) Bear Creek II between Tennessee
                               Gas Pipeline Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(m) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (n)         Gas Storage Contract under rate schedule FS
                               (Production Area) Bear Creek I between
                               Tennessee Gas Pipeline Company and Roanoke Gas
                               Company dated September 1, 1993 (incorporated
                               herein by reference to Exhibit 10(n) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)


                                       19

<PAGE>



                10 (o)         Certificate of Public Convenience and
                               Necessity for Bedford County dated February 21,
                               1966 (incorporated herein by reference to Exhibit
                               10(o) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (p)         Certificate of Public Convenience and
                               Necessity for Roanoke County dated October 19,
                               1965 (incorporated herein by reference to Exhibit
                               10(p) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (q)         Certificate of Public Convenience and
                               Necessity for Botetourt County dated August 30,
                               1966 (incorporated herein by reference to Exhibit
                               10(q) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (r)         Certificate of Public Convenience and
                               Necessity for Montgomery County dated July 8,
                               1985 (incorporated herein by reference to Exhibit
                               10(r) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (s)         Certificate of Public Convenience and
                               Necessity for Tazewell County dated March 25,
                               1968 (incorporated herein by reference to Exhibit
                               10(s) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (t)         Certificate of Public Convenience and Necessity
                               for Franklin County dated September 8, 1964 
                               (incorporated hereing by reference to Exhibit 
                               10(t) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August
                               29, 1990, and amended by Amendment No. 1, filed 
                               with the Commission on September 19, 1990)


                                       20

<PAGE>



                10 (u)         Ordinance of the Town of Bluefield, Virginia
                               dated August 25, 1986 (incorporated herein by
                               reference to Exhibit 10(u) of Registration
                               Statement No. 33-36605, on Form S-2, filed with
                               the Commission on August 29, 1990, and amended by
                               Amendment No. 1, filed with the Commission on
                               September 19, 1990)

                10 (v)         Ordinance of the City of Bluefield, West
                               Virginia dated as of August 23, 1979
                               (incorporated herein by reference to Exhibit
                               10(v) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (w)         Resolution of the Council for the Town of
                               Fincastle, Virginia dated June 8, 1970
                               (incorporated herein by reference to Exhibit
                               10(f) of Registration Statement No. 33-11383, on
                               Form S-4, filed with the Commission on January
                               16, 1987)

                10 (x)         Resolution of the Council for the Town of
                               Troutville, Virginia dated November 4, 1968
                               (incorporated herein by reference to Exhibit
                               10(g) of Registration Statement No. 33-11383, on
                               Form S-4, filed with the Commission on January
                               16, 1987)

                10 (y)*        Consulting Agreement between Albert W.
                               Buckley and Roanoke Gas Company dated February
                               20, 1992 (incorporated herein by reference to
                               Exhibit 10(b)(b) of the Annual Report on Form
                               10-K for the fiscal year ended September 30,
                               1992)

                10 (z)*        Consulting Contract between A. Anson Jamison
                               and Roanoke Gas Company dated March 27, 1990
                               (incorporated herein by reference to Exhibit
                               10(c)(c) of Registration Statement No. 33-36605,
                               on Form S-2, filed with the Commission on August
                               29, 1990, and amended by Amendment No. 1, filed
                               with the Commission on September 19, 1990)

                10 (a)(a)      Contract between Roanoke Gas Company
                               and Diversified Energy Services, Inc. dated
                               December 18, 1978 (incorporated herein by
                               reference to Exhibit 10(e)(e) of Registration
                               Statement No. 33-36605, on Form S-2, filed with
                               the Commission on August 29, 1990, and amended
                               by Amendment No. 1, filed with the Commission
                               on September 19, 1990)


                                       21

<PAGE>



                10 (b) (b)     Service Agreement between Bluefield Gas Company 
                               and Commonwealth Public Service Corporation dated
                               January 1, 1981 (incorporated herein by reference
                               to Exhibit 10(f)(f) of Registration Statement No.
                               33-36605, on Form S-2, filed with the Commission 
                               on August 29, 1990, and amended by Amendment No. 
                               1, filed with the Commission on September 19, 
                               1990)

                10 (c) (c)*    Retirement Payment Agreement between Arthur T. 
                               Ellett and Roanoke Gas Company dated April 6, 
                               1972 (incorporated herein by reference to Exhibit
                               10(g)(g) of Registration Statement No. 33-36605, 
                               on Form S-2, filed with the Commission on August 
                               29, 1990, and amended by Amendment No. 1, filed 
                               with the Commission on September 19, 1990)

                10 (d)(d)*     Consulting Services Agreement between Edward C. 
                               Dunbar and Roanoke Gas Company dated February 25,
                               1991 (incorporated herein by reference to Exhibit
                               10(h)(h) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1991)

                10 (e)(e)*     Consultation Contract between Gordon C. Willis 
                               and Roanoke Gas Company dated April 29, 1991 
                               (incorporated herein by reference to Exhibit 
                               10(i)(i) of the Annual Report on Form 10-K for
                               the fiscal year ended September 30, 1991)

                10 (f)(f)      Gas Storage Contract under rate schedule FS 
                               (Market Area) Portland between Tennessee Gas 
                               Pipeline Company and Roanoke Gas Company dated 
                               November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(k)(k) of the Annual 
                               Report on Form 10-K for the fiscal year ended 
                               September 30, 1994)

                10 (g)(g)      FTS Service Agreement between Columbia Gas 
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(l)(l) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (h)(h)      ITS Service Agreement between Columbia Gas
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(m)(m) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)


                                       22

<PAGE>



                10 (i)(i)      FSS Service Agreement between Columbia Gas 
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(n)(n) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (j)(j)      SST Service Agreement between Columbia Gas
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(o)(o) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (k)(k)      FTS-1 Service Agreement between Columbia Gas
                               Transmission Company and Bluefield Gas Company 
                               dated November 1, 1993 (incorporated herein by 
                               reference to Exhibit 10(p)(p) of the Annual 
                               Report on Form 10-K for the fiscal year ended
                               September 30, 1994)

                10 (l) (l)*    Roanoke Gas Company Key Employee Stock Option 
                               Plan (incorporated herein by reference to Exhibit
                               10(q)(q) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1995)

                10 (m) (m)*    Roanoke Gas Company Stock Bonus Plan 
                               (incorporated herein by reference to Exhibit 
                               10(r)(r) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1995)

                10 (n)(n)      Gas Franchise Agreement between the Town of 
                               Vinton, Virginia, and Roanoke Gas Company dated
                               July 2, 1996 (incorporated herein by reference to
                               Exhibit 10(n)(n) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)

                10 (o)(o)      Gas Franchise Agreement between the City of
                               Salem, Virginia, and Roanoke Gas Company dated 
                               July 9, 1996 (incorporated herein by reference to
                               Exhibit 10(o)(o) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)

                10 (p)(p)      Gas Franchise Agreement between the City of 
                               Roanoke, Virginia, and Roanoke Gas Company dated
                               July 12, 1996(incorporated herein by reference to
                               Exhibit 10(p)(p) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)


                                       23

<PAGE>



                10 (q)(q)*     Consulting Agreement between W. Bolling Izard and
                               Roanoke Gas Company dated January 27, 1997

                10 (r)(r)*     Roanoke Gas Company Restricted Stock Plan for 
                               Outside Directors

                10 (s)(s)      FTA Gas Transportation Agreement effective 
                               November 1, 1998, between East Tennessee Natural 
                               Gas Company and Roanoke Gas Company

                10 (t)(t)      SST Service Agreement effective November 1, 1997,
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (u)(u)      FSS Service Agreement effective April 1, 1997, 
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (v)(v)      FTS Precedent Agreement effective August 7, 1997,
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (w)(w)      Firm Storage Service Agreement effective March 
                               19, 1997, between Virginia Gas Storage Company 
                               and Roanoke Gas Company

                10 (x)(x)      FTS-2 Service Agreement effective February 1, 
                               1994, between Columbia Gulf Transmission Company 
                               and Bluefield Gas Company

                10 (y)(y)      Firm Transportation Agreement effective December 
                               31, 1998, between Phoenix Energy Sales Company 
                               and Bluefield Gas Company

                10 (z)(z)*     Agreement for Consulting Services effective 
                               January 26, 1998, between Frank A. Farmer, Jr. 
                               and Roanoke Gas Company

                10 (a)(a)(a)*  Agreement for Consulting Services effective 
                               January 26, 1998, between John H. Parrott and 
                               Roanoke Gas Company

                13             1998 Annual Report to Shareholders (such report, 
                               except to the extent incorporated herein by 
                               reference, is being furnished for the information

                                       24

<PAGE>



                               of the Commission only and is not to be deemed
                               filed as part of this Annual Report on Form 10-K)

                21             Subsidiaries of the Company (incorporated herein 
                               by reference to Exhibit (22) of Registration 
                               Statement No. 33-36605, on Form S-2, filed with 
                               the Commission on August 29, 1990, and amended
                               by Amendment No. 1, filed with the Commission on
                               September 19, 1990)

                23 (a)         Consent of Deloitte & Touche LLP

                23 (b)         Consent of KPMG Peat Marwick LLP

                27             Financial Data Schedule

                99             Letter of KPMG Peat Marwick LLP (incorporated 
                               herein by reference to Exhibit 99 of the Annual
                               Report on Form 10-K for the fiscal year ended 
                               September 30, 1997)

             *    Management contract or compensatory plan or agreement required
                  to be filed as an Exhibit to this Form 10-K pursuant to Item
                  14(c).

           (b) Reports on Form 8-K:

                None.

                                       25

<PAGE>



                                   SIGNATURES


Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                          ROANOKE GAS COMPANY



                          By:  s/Roger L. Baumgardner         December 9, 1998
                                 Roger L. Baumgardner               Date
                               Vice President, Secretary and
                                    Treasurer



                                       26

<PAGE>


Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the Registrant and
in the capacities and on the dates indicated.

s/John B. Williamson, III      December 9, 1998  President, Chief Executive 
John B. Williamson, III             Date          Officer and Director


s/Roger L. Baumgardner         December 9, 1998  Vice President, Secretary and
Roger L. Baumgardner                Date          Treasurer (Principal 
                                                  Accounting Officer)


s/Lynn D. Avis                 December 9, 1998  Director
Lynn D. Avis                        Date


s/Abney S. Boxley, III         December 9, 1998  Director
Abney S. Boxley, III                Date


s/Frank T. Ellett              December 9, 1998  Director
Frank T. Ellett                     Date


s/Frank A. Farmer, Jr.         December 9, 1998  Director
Frank A. Farmer, Jr.                Date


s/Wilbur L. Hazlegrove         December 9, 1998  Director
Wilbur L. Hazlegrove                Date


s/J. Allen Layman              December 9, 1998  Director
J. Allen Layman                     Date


s/Thomas L. Robertson          December 9, 1998  Director
Thomas L. Robertson                 Date


s/S. Frank Smith               December 9, 1998  Director
S. Frank Smith                      Date

                                       27

<PAGE>


                                 EXHIBIT INDEX


             Exhibit No.       Description

                3 (a)          Articles of Incorporation, as amended, of
                               Roanoke Gas Company (incorporated herein by
                               reference to Exhibit 3(a) of the Annual Report on
                               Form 10-K for the fiscal year ended September 30,
                               1997)

                3 (b)          Bylaws, as amended, of Roanoke Gas Company
                               (incorporated herein by reference to Exhibit 3(b)
                               of the Annual Report on Form 10-K for the fiscal
                               year ended September 30, 1997)

                4 (a)          Specimen copy of certificate for Roanoke Gas
                               Company common stock, $5.00 par value
                               (incorporated herein by reference to Exhibit 4(a)
                               of the Annual Report on Form 10-K for the fiscal
                               year ended September 30, 1992)

                4  (b)         Article I of the Bylaws of Roanoke Gas Company 
                               (included in Exhibit 3(b) hereto)

                4  (c)         Instruments defining the rights of holders of
                               long-term debt (incorporated herein by reference
                               to Exhibit 4(c) of the Annual Report on Form 10-K
                               for the fiscal year ended September 30, 1991)

                10 (a)         Firm Transportation Agreement between East
                               Tennessee Natural Gas Company and Roanoke Gas
                               Company dated November 1, 1993 (incorporated
                               herein by reference to Exhibit 10(a) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (b)         Interruptible Transportation Agreement
                               between East Tennessee Natural Gas Company and
                               Roanoke Gas Company dated July 1, 1991
                               (incorporated herein by reference to Exhibit
                               10(b) of the Annual Report on Form 10-K for the
                               fiscal year ended September 30, 1994)

                10 (c)         NTS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated October 25, 1994 (incorporated herein by
                               reference to Exhibit 10(c) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (d)         SIT Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 30, 1993 (incorporated herein by
                               reference to Exhibit 10(d) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)


<PAGE>



                10 (e)         FSS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(e) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (f)         FTS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(f) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (g)         SST Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(g) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (h)         ITS Service Agreement between Columbia Gas
                               Transmission Corporation and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(h) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (i)         FTS-1 Service Agreement between Columbia Gulf
                               Transmission Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(i) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (j)         ITS-1 Service Agreement between Columbia Gulf
                               Transmission Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(j) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (k)         Gas Transportation Agreement, for use under
                               FT-A rate schedule, between Tennessee Gas
                               Pipeline Company and 
<PAGE>

                               Roanoke Gas Company dated
                               November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(k) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (l)         Gas Transportation Agreement, for use under
                               IT rate schedule, between Tennessee Gas Pipeline
                               Company and Roanoke Gas Company dated September
                               1, 1993 (incorporated herein by reference to
                               Exhibit 10(l) of the Annual Report on Form 10-K
                               for the fiscal year ended September 30, 1994)

                10 (m)         Gas Storage Contract under rate schedule FS
                               (Production Area) Bear Creek II between Tennessee
                               Gas Pipeline Company and Roanoke Gas Company
                               dated November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(m) of the Annual Report
                               on Form 10-K for the fiscal year ended September
                               30, 1994)

                10 (n)         Gas Storage Contract under rate schedule FS
                               (Production Area) Bear Creek I between
                               Tennessee Gas Pipeline Company and Roanoke Gas
                               Company dated September 1, 1993 (incorporated
                               herein by reference to Exhibit 10(n) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (o)         Certificate of Public Convenience and
                               Necessity for Bedford County dated February 21,
                               1966 (incorporated herein by reference to Exhibit
                               10(o) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (p)         Certificate of Public Convenience and
                               Necessity for Roanoke County dated October 19,
                               1965 (incorporated herein by reference to Exhibit
                               10(p) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (q)         Certificate of Public Convenience and
                               Necessity for Botetourt County dated August 30,
                               1966 (incorporated herein by reference to Exhibit
                               10(q) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)
<PAGE>



                10 (r)         Certificate of Public Convenience and
                               Necessity for Montgomery County dated July 8,
                               1985 (incorporated herein by reference to Exhibit
                               10(r) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (s)         Certificate of Public Convenience and
                               Necessity for Tazewell County dated March 25,
                               1968 (incorporated herein by reference to Exhibit
                               10(s) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (t)         Certificate of Public Convenience and Necessity
                               for Franklin County dated September 8, 1964 
                               (incorporated hereing by reference to Exhibit 
                               10(t) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August
                               29, 1990, and amended by Amendment No. 1, filed 
                               with the Commission on September 19, 1990)

                10 (u)         Ordinance of the Town of Bluefield, Virginia
                               dated August 25, 1986 (incorporated herein by
                               reference to Exhibit 10(u) of Registration
                               Statement No. 33-36605, on Form S-2, filed with
                               the Commission on August 29, 1990, and amended by
                               Amendment No. 1, filed with the Commission on
                               September 19, 1990)

                10 (v)         Ordinance of the City of Bluefield, West
                               Virginia dated as of August 23, 1979
                               (incorporated herein by reference to Exhibit
                               10(v) of Registration Statement No. 33-36605, on
                               Form S-2, filed with the Commission on August 29,
                               1990, and amended by Amendment No. 1, filed with
                               the Commission on September 19, 1990)

                10 (w)         Resolution of the Council for the Town of
                               Fincastle, Virginia dated June 8, 1970
                               (incorporated herein by reference to Exhibit
                               10(f) of Registration Statement No. 33-11383, on
                               Form S-4, filed with the Commission on January
                               16, 1987)

                10 (x)         Resolution of the Council for the Town of
                               Troutville, Virginia dated November 4, 1968
                               (incorporated herein by reference to Exhibit
                               10(g) of Registration Statement No. 33-11383, on
                               Form S-4, filed with the Commission on January
                               16, 1987)
<PAGE>



                10 (y)*        Consulting Agreement between Albert W.
                               Buckley and Roanoke Gas Company dated February
                               20, 1992 (incorporated herein by reference to
                               Exhibit 10(b)(b) of the Annual Report on Form
                               10-K for the fiscal year ended September 30,
                               1992)

                10 (z)*        Consulting Contract between A. Anson Jamison
                               and Roanoke Gas Company dated March 27, 1990
                               (incorporated herein by reference to Exhibit
                               10(c)(c) of Registration Statement No. 33-36605,
                               on Form S-2, filed with the Commission on August
                               29, 1990, and amended by Amendment No. 1, filed
                               with the Commission on September 19, 1990)

                10 (a)(a)      Contract between Roanoke Gas Company
                               and Diversified Energy Services, Inc. dated
                               December 18, 1978 (incorporated herein by
                               reference to Exhibit 10(e)(e) of Registration
                               Statement No. 33-36605, on Form S-2, filed with
                               the Commission on August 29, 1990, and amended
                               by Amendment No. 1, filed with the Commission
                               on September 19, 1990)

                10 (b) (b)     Service Agreement between Bluefield Gas Company 
                               and Commonwealth Public Service Corporation dated
                               January 1, 1981 (incorporated herein by reference
                               to Exhibit 10(f)(f) of Registration Statement No.
                               33-36605, on Form S-2, filed with the Commission 
                               on August 29, 1990, and amended by Amendment No. 
                               1, filed with the Commission on September 19, 
                               1990)

                10 (c) (c)*    Retirement Payment Agreement between Arthur T. 
                               Ellett and Roanoke Gas Company dated April 6, 
                               1972 (incorporated herein by reference to Exhibit
                               10(g)(g) of Registration Statement No. 33-36605, 
                               on Form S-2, filed with the Commission on August 
                               29, 1990, and amended by Amendment No. 1, filed 
                               with the Commission on September 19, 1990)

                10 (d)(d)*     Consulting Services Agreement between Edward C. 
                               Dunbar and Roanoke Gas Company dated February 25,
                               1991 (incorporated herein by reference to Exhibit
                               10(h)(h) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1991)

                10 (e)(e)*     Consultation Contract between Gordon C. Willis 
                               and Roanoke Gas Company dated April 29, 1991 
                               (incorporated herein by reference to Exhibit 
                               10(i)(i) of the Annual Report on Form 10-K for
                               the fiscal year ended September 30, 1991)
<PAGE>



                10 (f)(f)      Gas Storage Contract under rate schedule FS 
                               (Market Area) Portland between Tennessee Gas 
                               Pipeline Company and Roanoke Gas Company dated 
                               November 1, 1993 (incorporated herein by
                               reference to Exhibit 10(k)(k) of the Annual 
                               Report on Form 10-K for the fiscal year ended 
                               September 30, 1994)

                10 (g)(g)      FTS Service Agreement between Columbia Gas 
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(l)(l) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (h)(h)      ITS Service Agreement between Columbia Gas
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(m)(m) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (i)(i)      FSS Service Agreement between Columbia Gas 
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(n)(n) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (j)(j)      SST Service Agreement between Columbia Gas
                               Transmission Corporation and Bluefield Gas 
                               Company dated November 1, 1993 (incorporated 
                               herein by reference to Exhibit 10(o)(o) of the
                               Annual Report on Form 10-K for the fiscal year
                               ended September 30, 1994)

                10 (k)(k)      FTS-1 Service Agreement between Columbia Gas
                               Transmission Company and Bluefield Gas Company 
                               dated November 1, 1993 (incorporated herein by 
                               reference to Exhibit 10(p)(p) of the Annual 
                               Report on Form 10-K for the fiscal year ended
                               September 30, 1994)

                10 (l) (l)*    Roanoke Gas Company Key Employee Stock Option 
                               Plan (incorporated herein by reference to Exhibit
                               10(q)(q) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1995)

                10 (m) (m)*    Roanoke Gas Company Stock Bonus Plan 
                               (incorporated herein by reference to Exhibit 
                               10(r)(r) of the Annual Report on Form 10-K for 
                               the fiscal year ended September 30, 1995)


<PAGE>



                10 (n)(n)      Gas Franchise Agreement between the Town of 
                               Vinton, Virginia, and Roanoke Gas Company dated
                               July 2, 1996 (incorporated herein by reference to
                               Exhibit 10(n)(n) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)

                10 (o)(o)      Gas Franchise Agreement between the City of
                               Salem, Virginia, and Roanoke Gas Company dated 
                               July 9, 1996 (incorporated herein by reference to
                               Exhibit 10(o)(o) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)

                10 (p)(p)      Gas Franchise Agreement between the City of 
                               Roanoke, Virginia, and Roanoke Gas Company dated
                               July 12, 1996(incorporated herein by reference to
                               Exhibit 10(p)(p) of Annual Report on Form 10-K 
                               for the fiscal year ended September 30, 1996)

                10 (q)(q)*     Consulting Agreement between W. Bolling Izard and
                               Roanoke Gas Company dated January 27, 1997

                10 (r)(r)*     Roanoke Gas Company Restricted Stock Plan for 
                               Outside Directors

                10 (s)(s)      FTA Gas Transportation Agreement effective 
                               November 1, 1998, between East Tennessee Natural 
                               Gas Company and Roanoke Gas Company

                10 (t)(t)      SST Service Agreement effective November 1, 1997,
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (u)(u)      FSS Service Agreement effective April 1, 1997, 
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (v)(v)      FTS Precedent Agreement effective August 7, 1997,
                               between Columbia Gas Transmission Corporation and
                               Roanoke Gas Company

                10 (w)(w)      Firm Storage Service Agreement effective March 
                               19, 1997, between Virginia Gas Storage Company 
                               and Roanoke Gas Company


<PAGE>



                10 (x)(x)      FTS-2 Service Agreement effective February 1, 
                               1994, between Columbia Gulf Transmission Company 
                               and Bluefield Gas Company

                10 (y)(y)      Firm Transportation Agreement effective December 
                               31, 1998, between Phoenix Energy Sales Company 
                               and Bluefield Gas Company

                10 (z)(z)*     Agreement for Consulting Services effective 
                               January 26, 1998, between Frank A. Farmer, Jr. 
                               and Roanoke Gas Company

                10 (a)(a)(a)*  Agreement for Consulting Services effective 
                               January 26, 1998, between John H. Parrott and 
                               Roanoke Gas Company

                13             1998 Annual Report to Shareholders (such report, 
                               except to the extent incorporated herein by 
                               reference, is being furnished for the information
                               of the Commission only and is not to be deemed
                               filed as part of this Annual Report on Form 10-K)

                21             Subsidiaries of the Company (incorporated herein 
                               by reference to Exhibit (22) of Registration 
                               Statement No. 33-36605, on Form S-2, filed with 
                               the Commission on August 29, 1990, and amended
                               by Amendment No. 1, filed with the Commission on
                               September 19, 1990)

                23 (a)         Consent of Deloitte & Touche LLP

                23 (b)         Consent of KPMG Peat Marwick LLP

                27             Financial Data Schedule

                99             Letter of KPMG Peat Marwick LLP (incorporated 
                               herein by reference to Exhibit 99 of the Annual
                               Report on Form 10-K for the fiscal year ended 
                               September 30, 1997)

             *    Management contract or compensatory plan or agreement required
                  to be filed as an Exhibit to this Form 10-K pursuant to Item
                  14(c).