FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549



                          (X) QUARTERLY REPORT PURSUANT
                            TO SECTION 13 OR 15(d) OF
                           THE SECURITIES EXCHANGE ACT
                                     OF 1934

                For the quarterly period ended September 30, 2002
                                               -------------------

                                       OR

          ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                For the transition period from________to_________

                         Commission File Number 0-10007

                              COLONIAL GAS COMPANY
                    D/B/A KEYSPAN ENERGY DELIVERY NEW ENGLAND
                    -----------------------------------------
             (Exact name of registrant as specified in its charter)


      MASSACHUSETTS                                        04-3480443
      -------------                                       ------------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                         Identification No.)


                 ONE BEACON STREET, BOSTON, MASSACHUSETTS 02108
                 ----------------------------------------------
                    (Address of principal executive offices)
                                   (Zip Code)

                                  617-742-8400
                                  ------------
              (Registrant's telephone number, including area code)


                                      None
                                      ----
               Former name, former address and former fiscal year,
                          if changed since last report.


     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
    ---      ---

Common stock of Registrant  at the date of this report was 100 shares,  all held
by KeySpan New England, LLC.

The Registrant meets the conditions set forth in General Instruction H(1)(a) and
(b) of Form 10-Q and is filing this Form with the reduced disclosure format.


<PAGE>


                          PART I. FINANCIAL INFORMATION
                          -----------------------------

ITEM 1.  FINANCIAL STATEMENTS
-----------------------------

Company or group of companies for which report is filed:

COLONIAL GAS COMPANY
Statements of Operations
<TABLE>
<CAPTION>
                                                                                          (Unaudited)
                                                                                        (In Thousands)
                                                                           For the                               For the
                                                                     Three Months Ended                     Nine Months Ended
                                                                     ------------------                     -----------------
                                                                September 30,      September 30,     September 30,     September 30,
                                                                    2002               2001              2002              2001
                                                                   -------            -------           -------           -------

<S>                                                                <C>                 <C>             <C>               <C>
OPERATING REVENUES                                                  $18,114            $ 19,482         $135,355          $183,716
    Cost of gas sold                                                 11,161              12,919           76,378           120,717
                                                                     ------              ------           ------           -------
    Operating Margin                                                  6,953               6,563           58,977            62,999

OPERATING EXPENSES:
    Operations and maintenance                                        6,196               7,176           21,553            22,283
    Depreciation and amortization                                     4,115               3,643           12,046            11,143
    Amortization of goodwill                                              -               2,334                -             7,001
    Operating taxes                                                     813               1,070            2,957             3,553
                                                                     ------              ------           ------            ------
    Total Operating Expenses                                         11,124              14,223           36,556            43,980
                                                                     ------              ------           ------            ------
OPERATING INCOME (LOSS)                                              (4,171)             (7,660)          22,421            19,019

OTHER INCOME (LOSS), NET                                                 34                  (4)              27               (75)
                                                                      -----                -----          ------             ------

INCOME (LOSS) BEFORE INTEREST EXPENSE
AND INCOME TAXES                                                     (4,137)             (7,664)          22,448            18,944
                                                                     ------              ------           ------            ------
INTEREST EXPENSE:
    Long-term debt                                                    1,868               2,133            5,951             6,382
    Other, including Advance from KeySpan
           and Utility Pool Borrowings                                4,812               4,050           13,181            12,546
    Less - Interest during construction                                 (96)                (22)            (589)              (90)
                                                                      -----               -----           ------            ------
    Total Interest Expense                                            6,584               6,161           18,543            18,838
                                                                     ------               -----           ------            ------

INCOME TAXES:
    Current                                                            (210)             (5,207)          5,084                877
    Deferred                                                         (4,046)                609          (3,704)             1,759
                                                                     ------           ---------          ------              -----
    Total Income Taxes (Benefit)                                     (4,256)             (4,598)          1,380              2,636
                                                                     ------              ------          ------              -----

NET INCOME (LOSS)                                                   $(6,465)            $(9,227)         $2,525            $(2,530)
                                                                    =======              ======          =======            ======
</TABLE>


The accompanying notes are an integral part of these financial statements.


<PAGE>



Colonial Gas Company
Balance Sheets

<TABLE>
<CAPTION>
                                                                                    Unaudited
                                                                                  (In Thousands)

                                                                               September 30,         December 31,
                                                                                   2002                  2001
                                                                                -----------          ------------

ASSETS
    <S>                                                                          <C>                   <C>
     Gas plant, at cost                                                            $420,639             $418,099
     Construction work-in-progress                                                   24,164                9,763
     Less-Accumulated depreciation                                                 (143,926)            (133,127)
                                                                                   --------             --------
                                                                                    300,877              294,735
                                                                                   --------             --------

CURRENT ASSETS:

     Cash and cash equivalents                                                          121                  121
     Accounts receivable                                                             11,633               23,240
     Allowance for uncollectible accounts                                            (2,499)              (3,709)
     Accounts receivable - affiliates                                                12,534               25,713
     Accrued utility revenue                                                          1,594               19,064
     Deferred gas costs                                                              12,850               15,579
     Gas in Storage, at average cost                                                 15,693               16,832
     Materials and supplies, at average cost                                            741                  695
     Prepaid expenses                                                                    72                   72
                                                                                     ------              -------
                                                                                     52,739               97,607
                                                                                     ------              -------


OTHER ASSETS:

     Goodwill                                                                       377,652              377,652
     Deferred charges and other assets                                                6,413                6,998
                                                                                    -------              -------
                                                                                    384,065              384,650
                                                                                    -------              -------

TOTAL ASSETS                                                                       $737,681             $776,992
                                                                                   ========             ========
</TABLE>

The accompanying notes are an integral part of these financial statements.




<PAGE>



Colonial Gas Company
Balance Sheets
<TABLE>
<CAPTION>
                                                                                               Unaudited
                                                                                              (In Thousands)

                                                                                      September 30,      December 31,
                                                                                          2002               2001
                                                                                   -----------------   ----------------

CAPITALIZATION AND LIABILITIES

CAPITALIZATION:
   <S>                                                                                    <C>                <C>
    Common stockholder's investment -
      Common stock, $1 par value -
      Authorized-200,000 shares;outstanding-100 shares                                     $      -           $      -
      Amounts in excess of par value                                                        269,430            269,430
    Retained earnings                                                                        (6,202)             5,272
    Accumulated comprehensive income                                                         (3,433)             (5,281)
                                                                                            -------           --------
      Total common stockholder's investment                                                 259,795            269,421
    Long-term obligations, less current portion                                             105,060            120,205
                                                                                           -------            --------
      Total Capitalization                                                                  364,855            389,626
    Advance from KeySpan                                                                    214,000            200,000
                                                                                            -------            -------
      Total Capitalization and Advance from KeySpan                                         578,855            589,626
                                                                                            -------            -------

CURRENT LIABILITIES:
     Current portion of long-term obligations                                                   171                296
     Note payable utility money pool                                                         66,524             68,517
     Note payable utility money pool-gas inventory financing                                 13,766             21,958
     Accounts payable                                                                         9,382             12,538
     Accrued taxes                                                                               22                821
     Accrued interest                                                                         3,107              8,726
     Other                                                                                      883              1,194
                                                                                            -------            -------
                                                                                             93,855            114,050
                                                                                             ------            -------

OTHER LIABILITIES:
     Deferred income taxes                                                                   32,682             38,322
     Unamortized investment tax credits                                                       2,249              2,402
     Postretirement benefits obligation                                                       7,271              6,770
     Other                                                                                   22,769             25,822
                                                                                             ------            -------
                                                                                             64,971             73,316
                                                                                             ------            -------

TOTAL CAPITALIZATION AND LIABILITIES                                                       $737,681           $776,992
                                                                                           ========           ========

</TABLE>

The accompanying notes are an integral part of these financial statements.


<PAGE>



   Colonial Gas Company
   Statement of Cash Flows
<TABLE>
                                                                                                     Unaudited
                                                                                                   (In Thousands)

                                                                                              For the Nine Months Ended
                                                                                              -------------------------
                                                                                        September 30,       September 30,
                                                                                            2002                 2001
                                                                                       --------------       ---------------
<S>                                                                                       <C>                    <C>
Cash flows from operating activities:
     Net income (Loss)                                                                      $2,525                $(2,530)
     Adjustments to reconcile net income to
         cash provided by operating activities:
         Depreciation and amortization                                                      12,046                 18,144
         Deferred taxes                                                                     (3,704)                 1,759
         Other changes in assets and liabilities:
              Accounts receivable                                                           10,397                 12,401
              Accounts receivable/payable-affiliates                                        13,179                 (7,712)
              Accrued utility revenue                                                       17,470                 19,608
              Deferred gas costs                                                             2,729                  4,261
              Gas in Storage                                                                 1,093                 (7,580)
              Accounts payable                                                              (3,156)               (17,041)
              Accrued taxes                                                                     75                   (170)
              Accrued interest                                                              (5,619)                14,684
              Other                                                                         (4,032)                 3,516
                                                                                            ------                 ------
Cash provided by operating activities                                                       43,003                 39,340
                                                                                           -------                 ------

Cash flows from investing activities:
     Capital expenditures                                                                  (17,818)               (16,836)
                                                                                           -------                -------
Cash used for investing activities                                                         (17,818)               (16,836)
                                                                                           -------                -------

Cash flows from financing activities:
     Repayment of long-term debt                                                           (15,000)                     -
     Repayments of note payable-utility money pool                                          (1,993)               (22,655)
     Repayments of note payable - utility money pool
          -gas inventory financing                                                          (8,192)                   178
     (Repayment) Advance from KeySpan                                                       14,000                (50,000)
     Capital Contribution                                                                        -                 50,000
     Dividend paid to KeySpan                                                              (14,000)                     -
                                                                                           -------                -------
Cash used for financing activities                                                         (25,185)               (22,477)
                                                                                           -------                -------

Increase (decrease) in cash and cash equivalents                                                 -                     27

Cash and cash equivalents at beginning of period                                               121                    124
                                                                                          --------                -------

Cash and cash equivalents at end of period                                               $     121                $   151
                                                                                         =========                =======

</TABLE>


The accompanying notes are an integral part of these financial statements.



<PAGE>



                              COLONIAL GAS COMPANY
                          NOTES TO FINANCIAL STATEMENTS
                                    UNAUDITED

                               September 30, 2002
                               ------------------


1.       Accounting Policies and Other Information
         -----------------------------------------

          Colonial Gas Company  d/b/a KeySpan  Energy  Delivery New England (the
          "Company") is a gas distribution company engaged in the transportation
          and sale of natural  gas to  residential,  commercial  and  industrial
          customers.  The Company's service territory includes 24 municipalities
          located  northwest  of  Boston  and on  Cape  Cod.  The  Company  is a
          wholly-owned subsidiary of KeySpan New England, LLC ("KNE LLC") and an
          indirect wholly-owned subsidiary of KeySpan Corporation ("KeySpan"), a
          registered  holding  company under the Public Utility  Holding Company
          Act of 1935, as amended.

          It is the Company's opinion that the accompanying financial statements
          contain all  adjustments  necessary  to present  fairly its  financial
          position as of September 30, 2002,  and the results of its  operations
          for the three and nine months ended  September  30, 2002 and September
          30, 2001,  as well as cash flows for the nine months  ended  September
          30, 2002 and September 30, 2001.  Interim  results are not necessarily
          indicative of results to be expected for the year, due to the seasonal
          nature of the Company's  operations.  Certain  reclassifications  were
          made to conform  prior period  financial  statements  with the current
          period  financial  statement   presentation.   Other  than  as  noted,
          adjustments were of a normal recurring nature and accounting  policies
          have been applied in a manner consistent with prior periods.

          The  preparation of financial  statements in conformity with generally
          accepted  accounting  principles requires management to make estimates
          and  assumptions  that  affect  the  reported  amounts  of assets  and
          liabilities,  the disclosure of contingent  assets and  liabilities at
          the date of the  financial  statements  and the  reported  amounts  of
          revenues and expenses  during the  reporting  period.  Actual  results
          could differ from those estimates.

          Certain  information  and footnote  disclosures  normally  included in
          financial  statements  prepared in accordance with generally  accepted
          accounting  principles  have been  condensed  or  omitted in this Form
          10-Q.  Therefore these interim financial  statements should be read in
          conjunction  with the Company's  2001 Annual Report filed on Form 10-K
          with the  Securities  and Exchange  Commission.  The December 31, 2001
          financial  statement  information  has been  derived  from the audited
          financial statements.

2.       Recent Accounting Pronouncements
         --------------------------------

          On  January  1, 2002,  the  Company  adopted  Statement  of  Financial
          Accounting Standards ("SFAS") 141, "Business  Combinations",  and SFAS
          142 "Goodwill and Other Intangible Assets".  The key concepts from the
          two  interrelated  Statements  include  mandatory  use of the purchase
          method when accounting for business  combinations,  discontinuance  of
          goodwill  amortization,  a  revised  framework  for  testing  goodwill
          impairment  at a  "reporting  unit"  level,  and new  criteria for the
          identification and potential  amortization of other intangible assets.
          Other changes to existing  accounting  standards involve the amount of
          goodwill to be used in determining the gain or loss on the disposal of
          assets and a  requirement  to test  goodwill for  impairment  at least
          annually.


<PAGE>


          SFAS  142  allows  for  various  valuation  methodologies  to test for
          impairment, including a discounted cash flow method, as compared to an
          undiscounted  cash flow method  utilized under the previous  standard.
          Impairment  is deemed to exist when the  carrying  amount of  goodwill
          exceeds its implied fair value. Upon adoption of SFAS 142, any amounts
          impaired  were to be recorded as a cumulative  effect of an accounting
          change in the Statement of Operations,  and any impairment  thereafter
          will be recorded as an operating  expense.  The  discounted  cash flow
          model  requires  broad   assumptions  and  significant   judgement  by
          management  including,  but not limited to,  projections  of revenues,
          working capital, capital expenditures, taxes and the cost of capital.

          The Company has completed its impairment  tests and determined that no
          impairment  exists.  Fair value was determined using a discounted cash
          flow methodology.  The test for impairment is required to be performed
          upon  adoption  of SFAS 142 and at least  annually  thereafter.  On an
          ongoing basis (absent any impairment indicators),  the Company expects
          to perform impairment tests during the fourth quarter.

          As discussed  above,  amortization  of goodwill has been  discontinued
          effective  January  1,  2002.  For the  three  and nine  months  ended
          September 30, 2001,  goodwill  amortization was $2.3 and $7.0 million,
          respectively.  As required by SFAS 142, below is a  reconciliation  of
          reported net income for the three and nine months ended  September 30,
          2001 and pro-forma net income, for the same periods,  adjusted for the
          discontinuance of goodwill amortization.
<TABLE>
<CAPTION>
           ----------------------------------- ----------------------- -------------------- -------------------- -------------------
                                               Three Months            Three Months         Nine Months          Nine Months
                                               Ended                   Ended                Ended                Ended
                                               September 30, 2002      September 30, 2001   September 30, 2002   September 30, 2001
           ----------------------------------- ----------------------- -------------------- -------------------- -------------------
          <S>                                  <C>                      <C>                 <C>                   <C>
           Net Income (Loss)                   $(6,465)                $ (9,227)            $ 2,525               $(2,530)

           Add back: goodwill amortization
                                                     -                    2,334                   -                 7,001
           ----------------------------------- ----------------------- -------------------- -------------------- -------------------
           Adjusted Net Income (Loss)          $(6,465)                $ (6,893)            $ 2,525               $ 4,471
           ----------------------------------- ----------------------- -------------------- -------------------- -------------------
</TABLE>

          In July of 2001,  the Financial  Accounting  Standards  Board ("FASB")
          issued SFAS 143,  "Accounting for Asset Retirement  Obligations".  The
          Statement  requires  entities  to record the fair value of a liability
          for an  asset  retirement  obligation  in the  period  in  which it is
          incurred.  When the liability is initially  recorded,  the entity will
          capitalize a cost by  increasing  the  carrying  amount of the related
          long-lived  asset.  Over time,  the  liability is accreted to its then
          present value, and the capitalized cost is depreciated over the useful
          life of the related asset. Upon settlement of the liability, an entity
          either settles the obligation for its recorded amount or incurs a gain
          or loss upon  settlement.  The Statement is effective for fiscal years
          beginning after June 15, 2002, with earlier application encouraged. We
          are currently  evaluating the impact, if any, that this Statement will
          have on the results of operations and financial position.


<PAGE>


          SFAS 144,  "Accounting  for the  Impairment  or Disposal of Long-Lived
          Assets," was effective  January 1, 2002, and addresses  accounting and
          reporting for the  impairment or disposal of long-lived  assets.  SFAS
          144 supersedes SFAS 121,  "Accounting for the Impairment of Long-Lived
          Assets and for  Long-Lived  Assets to Be Disposed  Of" and APB Opinion
          30,  "Reporting  the  Results of  Operations-Reporting  the Effects of
          Disposal of a Segment of a Business." SFAS 144 retains the fundamental
          provisions  of SFAS 121 and  expands  the  reporting  of  discontinued
          operations to include all components of an entity with operations that
          can be  distinguished  from the rest of the  entity  and that  will be
          eliminated  from the  ongoing  operations  of the entity in a disposal
          transaction.  The implementation of this Statement,  effective January
          1, 2002, did not have an impact on the Company's results of operations
          and financial position.

          In June of 2002,  the FASB  issued  SFAS  146,  "Accounting  for Costs
          Associated with Exit or Disposal Activities". This Statement addresses
          financial  accounting and reporting for costs  associated with exit or
          disposal  activities  and nullifies  Emerging  Issues Task Force Issue
          94-3, "Liability recognition for Certain Employee Termination Benefits
          and Other Costs to Exit an Activity".  This Statement is effective for
          exit or disposal  activities  initiated  after  December 31, 2002 with
          early application encouraged.

3.       Environmental Matters
         ---------------------

          The Company, like many other companies in the natural gas industry, is
          party to governmental proceedings requiring investigation and possible
          remediation  of former  manufactured  gas plant  ("MGP")  and  related
          sites. The Company may have or share  responsibility  under applicable
          environmental laws for the remediation of one former MGP site and nine
          related  satellite  disposal  sites, as well as one non-MGP site and a
          federal superfund site.

          As of September 30, 2002, the Company  estimates the remaining cost of
          its MGP-related  environmental  cleanup activities to be $2.7 million,
          which amount has been accrued by the Company as a reasonable  estimate
          of probable cost for known sites.  Expenditures  incurred to date with
          respect to these MGP-related activities total $13.3 million.

          By a rate order issued on May 25, 1990, the  Massachusetts  Department
          of  Telecommunications  and Energy (the  "Department")  approved,  for
          ratemaking purposes,  recovery of all prudently incurred environmental
          response  costs  associated  with  former  MGP  related  sites  over a
          seven-year period without carrying charges.

          The Company has  received and  responded  to Requests for  Information
          from the U.S.  Environmental  Protection  Agency  ("EPA")  pursuant to
          Section 104 of the Comprehensive Environmental Response,  Compensation
          and Liability Act  ("CERCLA"),  regarding one federal  superfund  site
          that the EPA is currently investigating.  The Company cannot determine
          the amount of its liability at this time.

4.       Seasonal Aspect
         ---------------

          The gas  distribution  business  is  influenced  by  seasonal  weather
          conditions.  Annual  revenues  are  principally  realized  during  the
          heating season (November 1, through April 30) as a result of the large
          proportion of heating sales in these  months.  In addition,  under its
          seasonal rate  structure,  the rates  charged to customers  during the
          heating  season are higher than the rates  charged  during the rest of
          the year. Accordingly, results of operations are most favorable in the
          first  quarter of the  Company's  fiscal year,  followed by the fourth
          quarter.  Losses  are  generally  incurred  in the  second  and  third
          quarters.

<PAGE>

5.   Related Party Transactions
     --------------------------

          The Company, and all utility subsidiaries of KeySpan, participate in a
          utility money pool established by KeySpan. KeySpan Corporate Services,
          LLC, a subsidiary  service  company of KeySpan,  administers the money
          pool and provides financing to the Company for working capital and gas
          inventory. The money pool is funded, in part, through surplus funds of
          money pool participants. Interest income or expense is recorded by the
          Company for net funds  advanced to or borrowed  from the money pool at
          an interest rate  generally  equal to KeySpan's  short-term  borrowing
          rate.  Interest incurred on gas inventory  financing is recovered from
          gas sales customers through the cost of gas adjustment clause.

6.       Regulation
         ----------

          In 1999, the  Department  approved a rate plan resulting in a ten-year
          freeze of base rates at current levels.  Due to the length of the base
          rate freeze,  the Company was required to discontinue  its application
          SFAS 71 "Accounting for the Effects of Certain Types of Regulation".

          On November 1, 2001,  the  Department  issued an order  requiring  all
          Massachusetts  electric and gas utilities to develop  service  quality
          plans  effective  January 1, 2002. On April 17, 2002,  the  Department
          issued an order approving the Company's  service quality plan that was
          filed with the  Department on March 1, 2002.  Service  quality will be
          tracked and measured against historical benchmarks. The Department may
          assess a  penalty  against a company  that  fails to meet its  service
          quality  benchmarks.  The  penalty  amount  can  be up  to  2% of  the
          Company's  distribution  revenues.  Each measurement  period will be a
          calendar year. The first measurement period began on January 1, 2002.

7.       Derivatives
         -----------

          On April 1, 2002 the Company adopted  Implementation Issue C16 of SFAS
          133, "Accounting for Derivative Instruments and Hedging Activities" as
          amended  and  interpreted  incorporating  SFAS 137 and 138 and certain
          implementation issues (collectively "SFAS 133"). Issue C16 establishes
          new  criteria  that  must be  satisfied  in order for  contracts  that
          combine a forward  contract  and a  purchased  option  contract  to be
          exempted as normal purchases and sales.

          Based upon a review of its physical gas purchase commodity  contracts,
          the  Company  determined  that  certain  contracts  could no longer be
          exempted as normal  purchases  from the  requirements  of SFAS 133. At
          September 30, 2002, the fair value of these  contracts was recorded as
          a $0.6 million liability. All gas and related transportation costs are
          currently  recovered from customers through the gas adjustment clause.
          Therefore, changes in the market value of these contracts are recorded
          as other assets or other liabilities on the Balance Sheet.

8.       Long-Term Debt
         --------------

          On May 20,  2002,  pursuant to a put option  exercised by the holders,
          the Company  repaid $15 million for the 6.81% Series A First  Mortgage
          Secured Medium Term Notes, dated May 19, 1997 that had a maturity date
          of May 19, 2027. The Notes were repaid at par and there was no gain or
          loss  recognized.  The Company  borrowed  the amount  needed to redeem
          these Notes through the utility money pool.

<PAGE>

9.       Gas Supply Contracts
         --------------------

          The Company had a portfolio  management  contract  with El Paso Energy
          Marketing  Company  ("El  Paso")  under  which  El Paso  provided  the
          majority of the city gate  supply  requirements  at market  prices and
          managed certain upstream capacity, underground storage and term supply
          contracts for Colonial.  The agreement with El Paso expired on October
          31,  2002.  The  Company has  negotiated  a new  portfolio  management
          agreement with  Entergy-Koch to replace the expired El Paso agreement.
          The new  agreement  with  Entergy-Koch  began on  November 1, 2002 and
          extends through March 31, 2003.

          The Company  recently  renewed its long-term  capacity  contracts with
          Tennessee  Gas Pipeline for the  transportation  of natural gas to the
          Company's distribution territory.


<PAGE>



          ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS:
          ----------------------


         RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2002


          Net Income  for the nine  months  ended  September  30,  2002 was $2.5
          million,  an increase of $5.0  million  over the $2.5 million net loss
          for the  corresponding  period of the prior  year.  This  increase  is
          primarily due to the discontinuance of goodwill  amortization  offset,
          in part, by a decline in operating margin.

          Operating  revenues for the nine-month period ended September 30, 2002
          declined  $48.4  million,  or 26%,  from the  nine-month  period ended
          September  30,  2001.  The  majority  of  this  decline  was  due to a
          significant decrease in the cost of gas sold to customers. Cost of gas
          sold for the  nine-month  period ended  September  30, 2002  decreased
          $44.3  million,  or 37%,  from 2001.  This  decline  was due to both a
          decrease in throughput  of 13% and a decline in the average  commodity
          price  of gas of 25%.  Decreased  throughput  was  principally  due to
          significantly warmer weather (11%).

          The Company's gas rate  structure  includes a gas  adjustment  clause,
          pursuant  to which gas  costs  are  recovered  in  revenues.  Further,
          variations  between  actual gas costs incurred and gas cost billed are
          deferred and refunded to or collected  from  customers in a subsequent
          period. As a result,  fluctuations in the cost of gas sold have little
          or no impact on operating margin.

          Operating  margin  (revenues less cost of gas sold) for the nine-month
          period ended September 30, 2002 decreased $4 million,  or 6%, from the
          nine-month  period ended September 30, 2001. The decline was primarily
          driven  by warmer  weather  ($5.6  million),  offset,  in part,  by an
          increase of $1.6 million due to customer growth.

          In accordance  with SFAS 142, as of January 1, 2002, the Company is no
          longer amortizing goodwill.  For the nine-month period ended September
          30, 2001, amortization of goodwill was $7 million.

          Income tax expense for the nine-month  period ended September 30, 2002
          decreased  approximately $1.3 million, or 48%, from 2001. The decrease
          is primarily  attributable  to lower pre-tax  earnings before goodwill
          amortization expense.

         LIQUIDITY AND CAPITAL RESOURCES

          As  discussed,  the  Company's  revenues,  earnings  and cash flow are
          highly seasonal.  Since the majority of its revenues are billed during
          the heating  season,  significant  cash flows are generated  from late
          winter to early summer. Alternatively, in preparation for the upcoming
          heating  season  (i.e.   purchasing   and  storing  gas),   short-term
          borrowings are highest during the late fall and early winter.

<PAGE>

          The Company  believes that  projected  cash flow from  operations,  in
          combination  with currently  available  resources (i.e.  utility money
          pool),  is  sufficient  to meet  2002  capital  expenditures,  working
          capital requirements and normal debt repayments.

          On March 31, 2002, the Company  received an additional  advance of $14
          million  from  KeySpan  and then paid a  dividend  to  KeySpan  of $14
          million.

          On May 20, 2002, the Company repaid $15 million for the 6.81% Series A
          First Mortgage  Secured Medium Term Notes.  The Company  financed this
          repayment by borrowing from the money pool. For further  details,  see
          Note 8 to the Financial Statements "Long-Term Debt".

          The Company expects capital  expenditures for 2002 to be approximately
          $25.0 million.  Actual capital  expenditures for the nine-month period
          ending September 30, 2002 were $17.8 million. Capital expenditures are
          largely  for system  expansion  associated  with  customer  growth and
          improvements to the distribution infrastructure.

         FORWARD-LOOKING INFORMATION

          Certain   statements   contained   in  this   Form   10-Q   concerning
          expectations,  beliefs, plans, objectives,  goals, strategies,  future
          events or performance and underlying  assumptions and other statements
          that  are   other   than   statements   of   historical   facts,   are
          "forward-looking  statements" within the meaning of Section 21E of the
          Securities  Exchange  Act of 1934,  as amended.  Without  limiting the
          foregoing, all statements relating to our future outlook,  anticipated
          capital  expenditures,  future cash flows and  borrowings,  pursuit of
          potential future acquisition opportunities and sources of funding, are
          forward-looking  statements.  Such forward-looking  statements reflect
          numerous  assumptions and involve a number of risks and  uncertainties
          and actual results may differ  materially from those discussed in such
          statements.  Among the  factors  that could  cause  actual  results to
          differ  materially are:  general  economic  conditions,  especially in
          Massachusetts;  available sources and cost of fuel;  federal and state
          regulatory  initiatives that increase  competition,  threaten cost and
          investment  recovery,  and impact rate structures;  the ability of the
          Company to successfully reduce its cost structure; inflationary trends
          and  interest  rates;  and other risks  detailed  from time to time in
          other reports and other  documents  filed by the Company with the SEC.
          For any of these statements,  the Company claims the protection of the
          safe harbor for forward-looking  information  contained in the Private
          Securities Litigation Reform Act of 1995, as amended.



<PAGE>



                           PART II. OTHER INFORMATION
                           --------------------------


ITEM 1.  LEGAL PROCEEDINGS
--------------------------

None


Item 4.  Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Within the 90 days prior to the date of this report,  the Company carried out an
evaluation,  under the supervision and with the  participation  of the Company's
management,  including its Chief Operating  Officer and Principal  Financial and
Accounting  Officer,  of the  effectiveness  of the design and  operation of the
Company's disclosure controls and procedures.  The Company's disclosure controls
and procedures are designed to ensure that information  required to be disclosed
by the Company in its periodic SEC filings is recorded,  processed  and reported
within the time periods  specific in the SEC's rules and forms.  Based upon that
evaluation,  the Chief Operating Officer and Principal  Financial and Accounting
Officer  concluded  that the Company's  disclosure  controls and  procedures are
effective  in timely  alerting  them to  material  information  relating  to the
Company required to be included in its periodic SEC filings.

Changes In Internal Controls

There were no significant changes in the Company's internal controls or in other
factors that could significantly affect these controls subsequent to the date of
their evaluation.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

(a)      List of Exhibits

          99.1* Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to
          Section 906 of the Sarbanes-Oxley Act of 2002.

          99.2* Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to
          Section 906 of the Sarbanes-Oxley Act of 2002.

         *Filed Herewith

(b) Reports on Form 8-K

         None



<PAGE>



SIGNATURES
----------



Pursuant to the requirements of the Securities Exchange Act of 1934, the Company
has duly  caused  this  report  to be signed  on its  behalf by the  undersigned
thereunto duly authorized.











                                            Colonial Gas Company
                                  D/B/A KEYSPAN ENERGY DELIVERY NEW ENGLAND
                                  -----------------------------------------
                                                (Registrant)




                                  /s/J.F. Bodanza
                                  --------------------------
                                  J.F. Bodanza, Senior Vice President
                                  Finance, Accounting and Regulatory Affairs
                                  (Principal Financial and Accounting Officer)





Dated: November 14, 2002




<PAGE>





               Certification Pursuant to Rule 13a-14 and 15d-14 of
                     the Securities and Exchange Act of 1934


     I, Nickolas Stavropoulos, certify that:

1.   I have reviewed this quarterly report on Form 10-Q of Colonial Gas Company;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

          a) designed  such  disclosure  controls and  procedures to ensure that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

          b) evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

          c)  presented  in this  quarterly  report  our  conclusions  about the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

          a) all significant deficiencies in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and


<PAGE>


          b) any fraud,  whether or not material,  that  involves  management or
          other  employees  who  have a  significant  role  in the  registrant's
          internal controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date: November 14, 2002



/s/Nickolas Stavropoulos
------------------------
Nickolas Stavropoulos
President and Chief Operating
Officer


<PAGE>


               Certification Pursuant to Rule 13a-14 and 15d-14 of
                     the Securities and Exchange Act of 1934


I, Joseph F. Bodanza, certify that:


1.   I have reviewed this quarterly report on Form 10-Q of Colonial Gas Company;

2.   Based on my knowledge,  this  quarterly  report does not contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this quarterly report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in this  quarterly  report,  fairly  present  in all
     material respects the financial  condition,  results of operations and cash
     flows of the  registrant  as of, and for,  the  periods  presented  in this
     quarterly report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:

          a) designed  such  disclosure  controls and  procedures to ensure that
          material  information  relating  to  the  registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during  the  period in which  this  quarterly
          report is being prepared;

          b) evaluated the effectiveness of the registrant's disclosure controls
          and procedures as of a date within 90 days prior to the filing date of
          this quarterly report (the "Evaluation Date"); and

          c)  presented  in this  quarterly  report  our  conclusions  about the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  registrant's  auditors  and the audit
     committee of  registrant's  board of directors (or persons  performing  the
     equivalent function):

          a) all significant deficiencies in the design or operation of internal
          controls  which could  adversely  affect the  registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  registrant's  auditors any material  weaknesses in
          internal controls; and

<PAGE>


          b) any fraud,  whether or not material,  that  involves  management or
          other  employees  who  have a  significant  role  in the  registrant's
          internal controls; and

6.   The  registrant's  other  certifying  officers and I have indicated in this
     quarterly report whether or not there were significant  changes in internal
     controls  or in other  factors  that could  significantly  affect  internal
     controls  subsequent to the date of our most recent  evaluation,  including
     any corrective actions with regard to significant deficiencies and material
     weaknesses.


Date: November 14, 2002

/s/ Joseph F. Bodanza
---------------------
Joseph F. Bodanza
Senior Vice President, Finance,
Accounting and Regulatory Affairs