UNITED STATES
                    SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  FORM 10-Q

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

For the quarterly period ended                          Commission file number
     September 30, 1998                                        000-23943


                             PETER KIEWIT SONS', INC.
                (Exact name of registrant as specified in its charter)

      Delaware                                       91-1842817
(State of Incorporation)                  (I.R.S. Employer Identification No.)



      Kiewit Plaza, Omaha Nebraska                        68131
(Address of principal executive offices)               (Zip Code)



                                 (402) 342-2052
              (Registrant's telephone number, including area code)

           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 [  ]

           The number of shares outstanding of each of the registrant's classes 
of common stock as of November 16, 1998:

               Title of Class                      Shares Outstanding
         Common Stock, $0.01 par value                 8,928,245




                                 PETER KIEWIT SONS', INC.

                                           Index

                                                                          Page
______________________________________________________________________________

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

Item 1.   Financial Statements.

          Consolidated Condensed Statements of Earnings for the three 
               months and  nine months ended September 30, 1998 and 1997     2
          Consolidated Condensed Balance Sheets as of September 30, 1998 
               and December 27, 1997                                         3
          Consolidated Condensed Statements of Cash Flows for the nine 
               months ended September 30, 1998 and 1997                      4
          Notes to Consolidated Condensed Financial Statements               5

Item 2.   Management's Discussion and Analysis of Financial Condition
               and Results of Operations.                                    9


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

Item 6.   Exhibits and Reports on Form 8-K.                                 14

Signatures                                                                  14

Index to Exhibits                                                           15
______________________________________________________________________________



                           PART I - FINANCIAL INFORMATION

Item 1.          Financial Statements.

                            PETER KIEWIT SONS', INC.

                   Consolidated Condensed Statements of Earnings
                                   (unaudited)






                                         Three Months Ended  Nine Months Ended
                                            September 30,     September 30,
                                          1998        1997   1998        1997
(dollars in millions, except per share data)
______________________________________________________________________________

Revenue                                   $ 963      $ 824   $ 2,533  $ 1,968
Cost of Revenue                            (878)      (754)   (2,347)  (1,784)
                                           ----       ----    ------   ------
                                             85         70       186      184

General and Administrative Expenses         (33)       (31)     (111)    (100)
                                           ----       ----    ------   ------
Operating Earnings                           52         39        75       84

Other Income (Expense):
   Investment Income, net                     3          3         9       10
   Interest Expense, net                     (1)        (2)       (2)      (3)
   Other, net                                21         15        49       50
                                           ----       ----    ------   ------
                                             23         16        56       57
                                           ----       ----    ------   ------
Earnings Before Income Taxes                 75         55       131      141

Provision for Income Taxes                  (30)       (21)      (52)     (57)
                                           ----       ----      ----     ----

Net Earnings                              $  45      $  34   $    79  $    84
                                           ====       ====    ======   ======
Net Earnings per Share:
  Basic                                   $5.13      $3.38   $  9.63  $  8.76
                                           ====       ====    ======   ======

  Diluted                                 $5.08      $3.24   $  9.52  $  8.38
                                           ====       ====    ======   ======

See accompanying notes to consolidated condensed financial statements.

                                   PETER KIEWIT SONS', INC.
                           Consolidated Condensed Balance Sheets

                                               September 30,       December 27,
                                                   1998                1997
(dollars in millions)                           (unaudited)
_______________________________________________________________________________
Assets

Current Assets:
  Cash and cash equivalents                        $  247           $  232
  Marketable securities                                15               26
  Receivables, less allowance of $7 and $9            519              430
  Costs and earnings in excess of
     billings on uncompleted contracts                 90              119
  Investment in construction joint ventures           177              176
  Deferred income taxes                                74               61
  Other                                                15               13
                                                    -----            -----
Total Current Assets                                1,137            1,057

Property, Plant and Equipment, less accumulated 
  depreciation and amortization of $472 and $446      216              197
Other Assets                                          102               87
                                                    -----            -----
                                                   $1,455           $1,341
                                                    =====            =====

Liabilities and Redeemable Common Stock

Current Liabilities:
  Accounts payable, including retainage
    of $45 and $37                                  $  230          $  208
  Current portion of long-term debt                      3               5
  Accrued construction costs and billings in excess
    of revenue on uncompleted contracts                314             217
  Accrued insurance costs                               84              76
  Other                                                 67              73
                                                     -----           -----
Total Current Liabilities                              698             579

Long-term debt, less current portion                    12              22
Other Liabilities                                       84              77
Minority Interest                                       11              11
                                                     -----           -----
      Total Liabilities                                805             689

Redeemable Common Stock ($450 million aggregate
  Redemption value in 1998):
    Common stock, par $0.01 and $0.0625, 8,931,045 
      and 10,132,343 shares outstanding in 1998 and 
      1997, respectively                                -                1
    Additional paid in capital                         165             116
    Foreign currency adjustment                         (9)             (7)
    Net unrealized holding loss                        (11)            (11)
    Retained earnings                                  505             553
                                                     -----            ----
Total Redeemable Common Stock                          650             652
                                                     -----           -----
                                                    $1,455          $1,341
                                                     =====           =====
_____________________________________________________________________________
See accompanying notes to consolidated condensed financial statements.

                                PETER KIEWIT SONS', INC.

                Consolidated Condensed Statements of Cash Flows
                                  (unaudited)




                                                            Nine Months Ended
                                                              September 30,
                                                            -----------------
(dollars in millions)                                       1998        1997
_____________________________________________________________________________

Cash flows from operations:
  Net cash provided by operations                          $ 154        $170

Cash flows from investing activities:
  Proceeds from sales and maturities of
      marketable securities                                   19          51
  Purchases of marketable securities                          (7)        (24)
  Proceeds from sales of property, plant and equipment        21          34
  Distributions from long-term investments                     8           4
  Contributions to long-term investments                      (3)        (20)
  Capital expenditures                                       (75)        (89)
                                                            ----         ---
      Net cash used in investing activities                  (37)        (44)

Cash flows from financing activities: 
  Long-term debt borrowing                                     -           3
  Short-term debt borrowing                                   20          - 
  Payments on short-term debt                                (25)         - 
  Issuance of common stock                                    67          34
  Repurchases of common stock                                (29)         (2)
  Dividends paid                                             (13)        (13)
  Exchange of Class C Stock for Class D Stock, net          (122)        (72)
                                                            ----         ---
      Net cash used in financing activities:                (102)        (50)

Net increase in cash and cash equivalents                     15          76

Cash and cash equivalents at beginning of period             232         173
                                                            ----         ---
Cash and cash equivalents at end of period                 $ 247        $249
                                                            ====         ===
______________________________________________________________________________
See accompanying notes to consolidated condensed financial statements.

                               PETER KIEWIT SONS', INC.

                 Notes to Consolidated Condensed Financial Statements


1.  Basis of Presentation:

Peter Kiewit Sons', Inc. (the "Company") was formed by its former parent, 
Level 3 Communications, Inc. (formerly Peter Kiewit Sons', Inc.) ("Level 3"), 
in connection with a transaction (the "Transaction") intended to separate the 
construction business and the diversified business of Level 3 into two 
independent companies.  On March 31, 1998, pursuant to the terms of a 
Separation Agreement between the Company, Level 3 and certain other parties 
(the "Separation Agreement"), Level 3 consummated the Transaction by: (i) 
transferring 100 shares of the $100 par value common stock ("KCG Stock") of 
Kiewit Construction Group Inc. ("KCG"), representing all of the issued and 
outstanding shares of KCG Stock, as well as certain other assets and 
liabilities related to the construction and mining business which together 
comprised the Construction and Mining Group (the "Construction & Mining 
Group"), to the Company in exchange for 7,677,920 shares of the $.01 par value 
common stock of the Company ("Common Stock") (125 million shares authorized) 
and (ii) distributing 100% of its shares of the Common Stock to the holders of 
Level 3's $0.0625 par value Class C Construction & Mining Group Restricted 
Redeemable Convertible Exchangeable Common Stock ("Class C Stock") as of 
March 31, 1998, in exchange for such shares of Class C Stock.  Prior to the 
Transaction, the Company was a wholly-owned subsidiary of Level 3.  As a result 
of the Transaction, the Company is now owned by the former holders of Level 3's 
Class C Stock.  As the Construction & Mining Group comprised all of the net 
assets and operations of the Company at the time of the Transaction, the 
Construction & Mining Group is the Company's predecessor.  Thus, the term "The 
Company", as used herein, refers to Peter Kiewit Sons', Inc., its predecessor, 
and its consolidated subsidiaries.

The consolidated condensed balance sheet of the Company at December 27, 1997 
has been condensed from the Construction & Mining Group's audited balance sheet 
as of that date.  All other financial statements contained herein are unaudited 
and, in the opinion of management, contain all adjustments (consisting only of 
normal recurring accruals) necessary for a fair presentation of financial 
position and results of operations for the periods presented.  The Company's 
accounting policies and certain other disclosures are set forth in the notes to 
the financial statements of the Construction and Mining Group for the year 
ended December 27, 1997 contained in the Company's Current Report on Form 8-K, 
dated March 27, 1998,  filed April 13, 1998 and amended May 1, 1998.

Receivables at September 30, 1998 and December 27, 1997 include approximately 
$121 million and $114 million, respectively of retainage on uncompleted 
projects, the majority of which is expected to be collected within one year.  
Included in the retainage amounts are $46 million and $44 million of securities 
which are being held by the owners of various construction projects in lieu of 
retainage.

The results of operations for the nine months ended September 30, 1998 are not 
necessarily indicative of the results to be expected for the full year.

When appropriate, items within the consolidated condensed financial statements 
have been reclassified in the previous periods to conform to current year 
presentation.


2.  Earnings Per Share:

Basic earnings per share have been computed using the weighted average number 
of shares outstanding during each period.  Diluted earnings give effect to 
convertible debentures considered to be dilutive common stock equivalents.  
Dilutive potential common shares are calculated in accordance with the "if 
converted" method.  This method assumes that the after-tax interest expense 
associated with the debentures is an addition to income and the debentures are 
converted into equity with the resulting common shares being aggregated with 
the weighted average shares outstanding.

                                        Three Months Ended    Nine Months Ended
                                           September 30,         September 30,
                                          1998       1997       1998      1997
                                         ------------------   -----------------
Net earnings available to common 
  shareholders (in millions)            $   45     $   34     $   79     $   84

Add:  Interest expense, net of tax effect, 
  associated with convertible debentures*   -          -          -          -

Net earnings for diluted shares         $   45     $   34     $   79     $   84

Total number of weighted average shares
  outstanding used to compute basic 
  earnings per share (in thousands)      8,776     10,086      8,167      9,570

Additional dilutive shares assuming 
  conversion of convertible debentures      90        437         90        437

Total number of shares used to compute 
  diluted earnings per share             8,866     10,523      8,257     10,007

Net earnings
  Basic earnings per share              $ 5.13     $ 3.38     $ 9.63     $ 8.76

  Diluted earnings per share            $ 5.08     $ 3.24     $ 9.52     $ 8.38

* Interest expense attributable to convertible debentures was less than $.5 
million  in 1998 and 1997.


3.  Comprehensive Income:

In the first quarter of 1998, the Company adopted Statement of Financial 
Accounting Standards ("SFAS") No. 130, "Reporting Comprehensive Income".  
SFAS 130 establishes new rules for the reporting of comprehensive income and 
its components; however the adoption of the standard had no impact on the 
Company's current or previously reported net income or redeemable common stock.
The standard requires the display and reporting of comprehensive income, which 
includes all changes in stockholders' equity with the exception of additional 
investments by stockholders or distributions to stockholders.  Comprehensive 
income for the Company includes net income, unrealized gains (losses) on 
securities, and foreign currency translation adjustments, which are charged or 
credited to the cumulative translation account within redeemable common stock.  
Comprehensive income for September 30, 1998 and 1997 was as follows:

                                        Three Months Ended    Nine Months Ended
                                          September 30,        September 30, 
(dollars in millions)                    1998        1997      1998       1997
_______________________________________________________________________________

Net Earnings                              $45         $34       $79        $84
Other comprehensive income, before tax:
  Foreign currency translation adjustments (3)         (3)       (3)        (5)
  Unrealized gains (losses) arising
    during period                           -           3         -         (7)
  Income tax (expense) benefit related to 
    items of other comprehensive income     1           -         1          5
                                           --          --        --         --
Comprehensive Income                      $43         $34       $77        $77
                                           ==          ==        ==         ==


4.  Preferred Stock:

The Company has authorized 250,000 shares of no par value Preferred Stock, the 
terms of which shall be determined from time-to-time by the board of 
directors.  No shares of Preferred Stock are currently issued and outstanding.


5.  Other Matters:

The Company is involved in various lawsuits, claims and regulatory proceedings 
incidental to its business.  Management believes that any resulting liability, 
beyond that provided, should not materially affect the Company's financial 
position, future results of operations or future cash flows.

In connection with the Transaction, the Company and Level 3 entered into 
various agreements including a Separation Agreement, a Tax-Sharing Agreement 
and an amended Mine Management Agreement.

The Separation Agreement provides for the allocation of certain risks and 
responsibilities between Level 3 and the Company and for cross-indemnifications 
that are intended to allocate financial responsibility to the Company for 
liabilities arising out of the construction business and to allocate to Level 3 
financial responsibility for liabilities arising out of the non-construction 
businesses.  The Separation Agreement also provides for the payment, by the 
Company, of a majority of the third party costs and expenses associated with 
the Transaction.

Under the Tax Sharing Agreement, with respect to periods, or portions thereof, 
ending on or before the closing date of the Transaction, Level 3 and the 
Company generally will be responsible for paying the taxes relating to such 
periods, including any subsequent adjustments resulting from the 
redetermination of such tax liabilities by the applicable taxing authorities, 
that are allocable to the non-construction businesses and construction 
businesses, respectively.  The Tax Sharing Agreement also provides that Level 3 
and the Company will indemnify the other from certain taxes and expenses that 
would be assessed if the Transaction was determined to be taxable, but solely 
to the extent that such determination arose out of the breach by Level 3 or the 
Company, respectively, of certain representations made to the Internal Revenue 
Service in connection with the ruling issued with respect to the Transaction or 
made in the Tax-Sharing Agreement.  If the Transaction were determined to be 
taxable for any other reason, those taxes ("Transaction Taxes") would be 
allocated 50% to Level 3 and 50% to the Company.  Finally, under certain 
circumstances, Level 3 would make certain liquidated damage payments to the 
Company if the Transaction was determined to be taxable in order to take into 
account the fact that the Transaction is taxable to the holders of Common 
Stock.

Additionally, the Mine Management Agreement, pursuant to which the Company 
provides mine management and related services to Level 3's coal mining 
operations, was amended to provide the Company with a right of offer in the 
event that Level 3 would determine to sell any or all of its coal mining 
properties.  Under the right of offer, Level 3 would be required to offer to 
sell those properties to the Company at the price that Level 3 would seek to 
sell the properties to a third party.  If the Company declined to purchase the 
properties at that price, Level 3 would be free to sell them to a third party 
for an amount greater than or equal to that price. If Level 3 sold the 
properties to a third party, thus terminating the Mine Management Agreement, it 
would be required to pay the Company an amount equal to the discounted present 
value of the Mine Management Agreement, determined, if necessary, by an 
appraisal process.

In September 1997, the Financial Accounting Standards Board issued Statement of 
Financial Accounting Standard No. 131, "Disclosures about Segments of an 
Enterprise and Related Information."  The Company must adopt this statement 
when preparing financial statements for the year ended December 26, 1998.  
Management is reviewing the requirements of this Statement and believes it will 
change the extent of its current business segment disclosure.  This Statement 
does not impact the basic consolidated financial statements; it affects the 
presentation of segment information in the Notes to the Consolidated Financial 
Statements.


Item 2.  Management's Discussion and Analysis of Financial Condition and
         Results of Operations.


This document contains forward looking statements and information that are 
based on the beliefs of management as well as assumptions made by and 
information currently available to the Company.  When used in this document, 
the words "anticipate," "believe," "estimate" and "expect" and similar 
expressions, as they relate to the Company or its management, are intended to 
identify forward-looking statements.  Such statements reflect the current views 
of the Company with respect to future events and are subject to certain risks 
or uncertainties and assumptions.  Should one or more of these risks or 
uncertainties materialize, or should underlying assumptions prove incorrect, 
actual results may vary materially from those described in this document.  The 
Company assumes no responsibility to update forward-looking information 
contained herein.

Results of Operations - Third Quarter 1998 vs. Third Quarter 1997

Revenue from each of the Company's businesses for the three months ended 
September 30, 1998 was (in millions):

                                                   Three Months Ended
                                                      September  30,
                                                   ------------------
                                                   1998          1997
                                                   ----          ----

     Construction                                  $871          $741
     Materials                                       92            83
                                                    ---           ---
                                                   $963          $824
                                                    ===           ===

Construction.  Revenues for the construction business increased $130 million or 
17.5% for the three months ended September 30, 1998 as compared to the same 
time period in 1997. The increase in revenues resulted from several new 
domestic cogeneration facilities and other new projects.  Another major factor 
was the "I-15" project, a $1.4 billion ($780 million the Company's share) 
design-build joint venture to reconstruct 16 miles of interstate through the 
Salt Lake City, Utah area.

Contract backlog at September 30, 1998 was nearly $5 billion of which 2% is 
attributable to foreign operations located primarily in Canada.  Domestic 
projects are spread geographically throughout the U.S.  

Margins on construction projects as a percentage of revenue for the three 
months ended September 30, 1998 decreased slightly to 8.4% from 8.8% for the 
same time period in 1997.  

In September of 1997, a Presidential Decree was issued in Indonesia affecting 
the construction and start-up dates for a number of private power projects.  As 
a result of the Decree and the continued fluctuations in the value of the 
Indonesian currency, several projects in Indonesia for a U.S. client have been 
suspended.  The suspension had no material impact on the Company, as 
substantially all payments have been received for work performed and the costs 
of demobilizing the project were not significant.


Materials.  Revenues for the materials business were up 11%, from $83 million 
to $92 million, for the three months ended September 30, 1998 as compared to 
the same time period in 1997.  Greater sales volume and higher average selling 
prices for aggregates, ready mix concrete and asphalt products resulted in a 
16% increase which was offset by the decrease in revenues from the Oak Mountain 
Coal operations.  The investment in Oak Mountain was sold on June 9, 1998.  The 
Oak Mountain investment was previously written off as an impaired asset in 
December 1997, thus, no gain or loss resulted from the sale.

Margins from materials sales as a percentage of revenue for the three months 
ended September 30, 1998 increased by 7% from the same period in 1997.  The 
increase in margins was attributable to higher average selling prices, 
improvements in the performance of recent acquisitions and the elimination of 
losses from the Oak Mountain Coal operations. 


General and Administrative Expenses.  General and administrative expenses 
increased 6.5% from 1997 for the three month period ended September.  The 
increase was attributable to increased costs related to higher construction and 
materials revenues.  G&A expense, as a percent of revenue, decreased from 3.8% 
in 1997 to 3.4% in 1998 as a proportionate increase in administration costs 
were not necessary to support the Company's revenue growth.


Investment Income, net.  Investment income remained unchanged from the same 
time period in 1997.


Other, net.   Other income is primarily comprised of mine management fee income 
from Level 3 and gains and losses on the disposition of property, plant and 
equipment and other assets.  The mine management fee increased by $3 million 
while an increase in the amount of equipment sold during the third quarter of 
1998 resulted in a $6 million increase in gains from sales.

The mines managed by the Company for Level 3 earn the majority of their 
revenues under long-term contracts.  The remainder of the mines' sales are made 
on the spot market where prices are substantially lower than those of the long-
term contracts.  As the long-term contracts expire over the next two to five 
years, operating earnings at the mines will decrease substantially.  Since the 
mine management fee is based upon the operating earnings of the mines, the fee 
will be similarly affected.


Results of Operations - Nine Months 1998 vs. Nine Months 1997

Revenue from each of the Company's businesses for the nine months ended 
September 30, 1998 was (in millions):

                                                            Nine Months Ended
                                                              September 30,
                                                            -----------------
                                                             1998       1997
                                                             ----       ----

          Construction                                     $2,277     $1,757
          Materials                                           256        211
                                                            -----      -----
                                                            $2,533    $1,968
                                                             =====     =====


Construction.  Revenues for the construction business increased $520 million or 
30% from the same time period in 1997.  $181 million of the increase in 
revenues resulted from several new domestic cogeneration facilities.  Joint 
ventures performing electrical work on railway systems contributed another $80 
million. Another major factor was the "I-15" project, a $1.4 billion ($780 
million the Company's share) design-build joint venture to reconstruct 16 miles 
of interstate through the Salt Lake City, Utah area which contributed $133 
million to the increase.  Several new projects account for the remainder of the 
increase.

Margins on construction projects as a percentage of revenue for the nine months 
ended September 30, 1998 decreased to 7.2% from 9.7% for the same time period 
in 1997. The favorable resolution of project uncertainties, change order 
settlements and bonuses for cost savings and early completion increased margins 
for the first nine months of 1997.  Margins in the first nine months of 1995 
and 1996 were 7.6% and 8.9% respectively.

In September of 1997, a Presidential Decree was issued in Indonesia affecting 
the construction and start-up dates for a number of private power projects.  As 
a result of the Decree and the continued fluctuations in the value of the 
Indonesian currency, several projects in Indonesia for a U.S. client have been 
suspended.  The suspension had no material impact on the Company, as 
substantially all payments have been received for work performed and the costs 
of demobilizing the project were not significant.


Materials.  Revenues for the materials business were up 21%, from $211 million 
to $256 million, for the nine months ended September 30, 1998 as compared to 
the same time period in 1997.  Greater sales volume and higher average selling 
prices for aggregates, ready mix concrete and asphalt products contributed to 
the majority of the increase. The investment in the Oak Mountain Coal Mine was 
sold on June 9, 1998.  The Oak Mountain investment was  previously written off 
as an impaired asset in December 1997.  Thus, no gain or loss resulted from the 
sale.

Margins from materials sales as a percentage of revenue for the nine months 
ended September 30, 1998 increased 2% over the same time period in 1997.  The 
slight increase in margins can be attributed to higher average selling prices 
and improvements in the performance of recent acquisitions.  


General and Administrative Expenses.  General and administrative expenses 
increased 11% in 1998.  The increase was attributable to increased costs 
related to higher Construction and Materials revenues.  G & A expense, as a 
percent of revenue, decreased from 5.1% in 1997 to 4.4% in 1998 as a 
proportionate increase in administration costs were not necessary to support 
the Company's revenue growth.


Investment Income, net.  Investment income remained relatively unchanged from 
the same time period in 1997.


Other, net.   Other income is primarily comprised of mine management fee income 
from Level 3 and gains and losses on the disposition of property, plant and 
equipment and other assets.  The mine management fee increased by $4 million 
while a decrease in the amount of equipment sold during 1998 resulted in a $7 
million decrease in gains from sales.  

The mines managed by the Company for Level 3 earn the majority of their 
revenues under long-term contracts.  The remainder of the mines' sales are made 
on the spot market where prices are substantially lower than those of the long-
term contracts.  As the long-term contracts expire over the next two to five 
years, operating earnings at the mines will decrease substantially.  Since the 
mine management fee is based upon the operating earnings of the mines, the fee 
will be similarly affected.


Financial Condition - September 30, 1998 vs. December 27, 1997

The Company's working capital decreased $39 million or 8% during the first nine 
months of 1998.  The decline was primarily due to cash used when shareholders 
elected to exchange their Class C Stock for Class D Stock, totaling $122 
million, repurchases of Class C Stock of $29 million, dividends of $13 million 
and repayment of short-term debt of $25 million.  In addition, the Company had 
capital expenditures of $75 million.  Partially funding these outflows was $154 
million of cash provided by operations, the issuance of common stock of $67 
million, $12 million in net proceeds from the sale and maturity of marketable 
securities and $21 million in proceeds from the sale of property, plant and 
equipment.

The Company anticipates investing between $50 and $100 million annually in its 
construction business.  In addition to normal spending, the Company expects to 
make significant investments in new construction joint ventures in 1998.  The 
Company continues to explore opportunities to acquire additional businesses.  
Other long-term liquidity uses include the payment of income taxes and 
repurchases of common stock and the payment of dividends, including an $.80 per 
share dividend declared in April and paid in May, 1998.  The Company's current 
financial condition and borrowing capacity together with anticipated cash flows 
from operations should be sufficient for immediate cash requirements and future 
investing activities.

In September 1997, the Financial Accounting Standards Board issued Statement of 
Financial Accounting Standard No. 131, "Disclosures about Segments of an 
Enterprise and Related Information."  The Company must adopt this statement 
when preparing financial statements for the year ended December 26, 1998.  
Management is reviewing the requirements of this Statement and believes it will 
change the extent of its current business segment disclosure.  This Statement 
does not impact the basic consolidated financial statements; it affects the 
presentation of segment information in the Notes to the Consolidated Financial 
Statements.


Year 2000 Update:

General.  The Company's Year 2000 Project ( the "Project") is proceeding on 
schedule.  The Project is comprised of two components:  Internal, which 
includes updating and replacing all computer systems which are not Year 2000 
compliant, and External, which requires developing strategies to protect the 
Company from disruptions caused by third parties not being Year 2000 compliant.


Internal.  The most significant Internal component is the replacement of the 
current mainframe payroll system with a client server-based system.  The new 
system is intended to bring payroll systems into Year 2000 compliance.  All 
other internal systems materially affecting operations have already been 
updated.  The Internal systems component of the Project is expected to be 
completed in mid-1999, well ahead of the Year 2000 deadline.  The Project did 
not delay any other Information System projects as several systems were already 
scheduled to be revised.  The Company does not believe that a backup plan is 
necessary as the project is sufficiently well enough along.  Check writing with 
manual intervention would be in place to handle payroll on a short-term basis 
if the Project was not completed before the Year 2000 deadline.  The Company's 
ability to process payroll and make the associated tax payment, in the long-
term, would be adversely affected if the deadline is not met.


External.  The primary External factor which could have a negative impact on 
The Company's operations is the inability of third party owners to pay the 
Company on a timely basis for work performed as a result of their Year 2000 
problem.  A large portion of the Company's domestic construction work is with 
federal, state and local government agencies.  If these agencies are unable to 
make payments due to their own Internal Year 2000 problems, the Company could 
experience cash flow problems.

Another potentially significant External factor which could have a negative 
impact on the Company's operations is the inability of major equipment 
suppliers to supply the company with the equipment needed to complete various 
construction projects as a result of their Year 2000 problems.  Other major 
purchasing components, primarily permanent materials, have alternative 
procurement sources, in the event that the primary supplier encounters 
problems.


Costs.  The total cost associated with the Project is not expected to be 
material to the Company's financial position. The estimated total cost of the 
Project is approximately $5.9 million, of which $3.1 million has been spent to 
date.


Risks.  The failure to correct a material Internal Year 2000 problem could 
result in the disruption of some normal activities and negatively impact the 
Company's ability to complete projects on a timely basis.  Such failures could 
materially and adversely affect the Company's results of operations, liquidity 
and financial condition.  Due to the general uncertainty inherent in the Year 
2000 problem, resulting in large part from the uncertainty of the Year 2000 
readiness of third party suppliers and owners, the Company is unable to 
determine at this time whether the consequences of External Year 2000 failures 
will have a material impact on the Company's results of operations, liquidity 
or financial condition.  The Project is expected to significantly reduce the 
Company's level of uncertainty about the Year 2000 problem and, in particular, 
about the Year 2000 compliance and readiness of its material third party 
suppliers and owners.  The Company believes that, with the implementation of 
new business systems and completion of the Project as scheduled, the 
possibility of significant interruptions of normal operations should be 
reduced.


Forward Looking Statements.  The discussion of the Company's efforts and 
management's expectations relating to the Year 2000 problem are forward-looking 
statements.  The Company's ability to achieve  Year 2000 compliance and the 
costs associated therewith could be adversely impacted by, among other things, 
the availability and cost of programming and testing resources, the ability of 
third party suppliers and customers to bring their systems into Year 2000 
compliance, and unanticipated problems identified in the implementation of the 
Project.  


                        PART II - OTHER INFORMATION

Item 6.       Exhibits and Reports on Form 8-K.

          (a) Exhibits required by Item 601 of Regulation S-K. 


       Exhibit
       Number           Description
       -------          -----------

         27             Financial Data Schedule


          (b) Reports on Form 8-K.

          No reports on Form 8-K have been filed during the quarter for which 
this report is filed.

                                SIGNATURES

           Pursuant to the requirements 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.

                                                  PETER KIEWIT SONS', INC.






Date: November 16, 1998                           /s/  Kenneth M. Jantz 
                                                  ------------------------
                                                  Kenneth M. Jantz 
                                                  Vice President and 
                                                  Principal Financial Officer

                           PETER KIEWIT SONS', INC.

                               INDEX TO EXHIBITS




          Exhibit
            No.
          -------

             27   Financial Data Schedule (For electronic filing purposes only)





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