CONSENT AND AGREEMENT


         CONSENT AND AGREEMENT,  dated as of April 15, 1991,  between the lender
whose name  appears on the  signature  page  hereof  (the  "Lender")  and ALASKA
PIPELINE COMPANY, an Alaska corporation (the "Company").

     WHEREAS,  the Company has  outstanding  on the date  hereof,  (i)  $144,000
aggregate principal amount of its 8 3/8% Series A Notes due January 1, 1993 (the
"Series A  Notes"),  (ii)  $460,000  aggregate  principal  amount of its 10 1/4%
Series B Notes due  January  1, 1995 (the  "Series B Notes"),  (iii)  $2,100,000
aggregate  principal  amount of its 9.95%  Series D Notes due April 1, 1997 (the
"Series D Notes"),  (iv)  $14,500,000  aggregate  principal amount of its 12.70%
Series F Notes due July 1, 1995 (the "Series F Notes"), (v) $3,000,000 aggregate
principal  amount of its 12.80%  Series G Notes due July 1, 2000 (the  "Series G
Notes"),  and (vi) $8,000,000  aggregate principal amount of its 12.75% Series H
Notes due July 1, 2000 (the  "Series H Notes"  and,  together  with the Series A
Notes, the Series B Notes, the Series D Notes, the Series F Notes and the Series
G Notes, the "Notes");

         WHEREAS,  the  Series A Notes and the  Series B Notes  were  originally
issued  pursuant to a Note Agreement  dated as of August 15, 1972 (as heretofore
amended, the "1972 Note Agreement");

         WHEREAS,  the Series D Notes were originally  issued pursuant to a Note
Agreement  dated as of March 15,  1977 (as  heretofore  amended,  the "1977 Note
Agreement");

         WHEREAS,  the Series F Notes, the Series G Notes and the Series H Notes
were originally issued pursuant to separate Note Agreements dated as of June 17,
1985 (as heretofore  amended,  the "1985 Agreement" and,  together with the 1972
Note Agreement,  the 1975 Note Agreement and the 1977 Note Agreement,  the "Note
Agreements");

         WHEREAS,  the  Lender is the owner and  holder of  certain of the Notes
(the "Lender Notes");

         WHEREAS, the Company and the Lender desire to amend in certain respects
the Note Agreements  pursuant to which the Lender Notes were  originally  issued
(the "Lender Notes");

         WHEREAS, as of the date hereof, Seagull Energy Corporation  ("Seagull")
has outstanding $66,951,512 aggregate principal amount of Intercompany Notes (as
defined in the Lender Note Agreements),  such Intercompany  Notes (the "Existing
Intercompany  Notes")  being more  particularly  described in Exhibit A attached
hereto;

         WHEREAS,  the  Company and Seagull  have  requested  the consent of the
Lender to the execution and delivery by Seagull of new  Intercompany  Notes,  in
exchange for and in replacement  of the Existing  Intercompany  Notes,  such new
Intercompany  Notes (the  "Replacement  Intercompany  Notes") to be identical in
form and substance to the respective Existing  Intercompany Notes being replaced
thereby  except  that each  Replacement  Intercompany  Note  shall  include  the
additional provision set forth in Exhibit B attached hereto; and <PAGE>

         WHEREAS,  the  Company and Seagull  have  requested  the consent of the
Lender to the  execution  and  delivery  by the  Company  and Seagull of a Ninth
Supplemental  Mortgage  in the form of Exhibit C  attached  hereto  (the  "Ninth
Supplemental  Mortgage")  for the  purpose of  supplementing  and  amending  the
Intercompany  Mortgage (as defined in the Lender Note  Agreements)  so as to (i)
permit the inclusion of the provision set forth in Exhibit B attached  hereto in
all Intercompany  Notes issued after the date hereof and (ii) cause Section 3.02
of the  Intercompany  Mortgage to be consistent  with the provision set forth in
Exhibit B attached hereto;

         NOW,  THEREFORE,  in  consideration of the foregoing and other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the Lender and the Company hereby consent and agree as follows:

         1. The  Company  and the Lender  hereby  agree  that  clause (a) of the
definition of  "Consolidated  Adjusted Net Earnings"  contained in Section 14 of
each Lender Note Agreement is amended to read in its entirely as follows:

     "(a) there shall be deducted an amount equal to the excess,  if any, of (i)
the sum of (x) the aggregate amount applied by the Company during such period to
the payment,  redemption,  retirement and purchase of Funded Debt of the Company
(other than any amount payable at the scheduled maturity of any such Funded Debt
or on account of any mandatory or required sinking,  purchase or other analogous
fund with respect to any such Funded Debt) and (y) the aggregate  amount applied
by the  Company  during  such  period to the  repayment  during  such  period of
advances to the Company by Seagull over (ii) the sum of (x) the aggregate amount
of  depreciation  and  amortization  deducted  during such period in determining
Consolidated  Net Income as  Reported,  (y) the  aggregate  principal  amount of
Funded  Debt  incurred  by the  Company  during  such  period for the purpose of
renewing, extending, refinancing, refunding, rearranging or replacing any Funded
Debt taken into account  under  subclause (i) (x) above and (z) the sinking fund
payments made by Seagull to the Company  during such period in  accordance  with
indebtedness  of the  Division  to the  Company  evidenced  by the  Intercompany
Notes;".

         2. The Company and the Lender hereby agree that,  except as hereinabove
amended and modified,  each Lender Note  Agreement  shall continue in full force
and effect.

         3. The Lender  hereby  consents to (a) the  execution  and  delivery by
Seagull of the Replacement Intercompany Notes in exchange for and in replacement
of the Existing  Intercompany  Notes and (b) the  execution  and delivery by the
Company and Seagull of the Ninth Supplemental Mortgage.

<PAGE>

         IN WITNESS WHEREOF, the Company and the Lender have caused this Consent
and Agreement to be executed as of the date first above written.

         ALASKA PIPELINE COMPANY



         By:____________________________________


         THE TRAVELERS INSURANCE COMPANY



         By:____________________________________



<PAGE>



                         Intercompany Notes Outstanding
                              as of April 15, 1991
<TABLE>
<CAPTION>


                                                     Original                      Outstanding
                                                     Principal                      Principal
                            Date                      Amount                          Amount
                      -----------------        ----------------------         -----------------------
<S>                    <C>                     <C>                            <C>

                          01/01/85               $           245,000             $            35,000
                          01/01/85                           320,000                          80,000
                          12/31/84                           900,000                         300,000
                          01/01/85                           760,000                         304,000
                          01/01/85                           165,000                          66,000
                          01/01/85                         1,620,000                         810,000
                          04/01/85                           300,000                         150,000
                          04/01/85                           660,000                         330,000
                          06/01/85                         2,332,650                       2,332,650
                          01/01/85                         2,150,000                       2,150,000
                          07/01/85                        24,300,000                      18,900,000
                          12/31/85                         3,000,000                       2,350,000
                          12/31/86                        10,650,000                       8,290,000
                          12/31/88                         8,000,000                       6,220,000
                          12/31/89                         8,300,000                       7,263,000
                          12/31/90                        12,300,000                      12,300,000
                          12/31/84                         5,070,862                       5,070,862
                                               ======================         =======================
                                                 $        81,073,512             $        66,951,512
                                               ======================         =======================
</TABLE>





<PAGE>

         Anything  in this Note,  the  Mortgage  or  elsewhere  to the  contrary
notwithstanding,  Seagull shall not be personally  liable for the payment of the
principal  of,  premium (if any) or interest  on this Note,  it being  expressly
understood  and agreed that the sole recourse of the holder of this Note for the
payment  hereof  shall be against the  Mortgaged  Property  and that no recourse
(whether under rule of law, statute or constitution or by the enforcement of any
assessment  or penalty or otherwise)  shall be had against  Seagull or any other
Person for the payment of the principal of, premium (if any) or interest on this
Note or for any claim based  hereon or otherwise  in respect  hereof;  provided,
however,  that  nothing in this  paragraph  shall (i) affect the validity of the
indebtedness  evidenced by this Note or the rights of any holder of this Note to
proceed  against the Mortgaged  Property in accordance  with the Mortgage,  (ii)
constitute a waiver of any  indebtedness  or  obligation  evidenced by this Note
(but the same shall continue until paid or discharged), (iii) limit or otherwise
prejudice in any way the right of any holder of this Note to name Seagull or any
owner, holder or transferee of any interest in the Mortgaged Property as a party
defendant in any action or suit for judicial  foreclosure of, or in the exercise
of any other  remedy  available  to such holder with  respect to, the  Mortgaged
Property  so long as no  judgment  in the  nature  of a  deficiency  or  seeking
personally  liability  shall  be  asked  of or (if  obtained)  enforced  against
Seagull.




<PAGE>

================================================================================






                           SEAGULL ENERGY CORPORATION
                                  As Mortgagor





                                       TO




                            ALASKA PIPELINE COMPANY
                                  As Mortgagee



                                  ------------



                           NINTH SUPPLEMENTAL MORTGAGE



                       Dated as of ________________, 1991


                                  ------------











Further  Supplementing and Amending the First Mortgage and Deed of Trust,  dated
as of August 1, 1960,  as  heretofore  supplemented,  amended and  restated by a
Supplemental  Mortgage  dated as of  September  9, 1960,  a Second  Supplemental
Mortgage  dated as of May 1, 1961,  a Third  Supplemental  Mortgage  dated as of
December 15, 1969, a Fifth Supplemental  Mortgage dated as of November 15, 1975,
a  Sixth  Supplemental  Mortgage  dated  as of  December  30,  1977,  a  Seventh
Supplemental  Mortgage  dated as of  January  1, 1984 and an Eight  Supplemental
Mortgage dated as of June 17, 1985.


================================================================================
<PAGE>


NINTH  SUPPLEMENTAL  MORTGAGE,  dated as of  __________________,  1991,  between
SEAGULL ENERGY CORPORATION (the "Company"),  a Texas  corporation,  party of the
first part, and ALASKA PIPELINE COMPANY ("Alaska"), an Alaska corporation, party
of the second part.

                                    RECITALS

     WHEREAS,  Alaska  Public  Service  Corporation  (formerly  named  Anchorage
Natural Gas Corporation and herein called  "Service"),  in order to secure loans
made to it form time to time by Alaska,  executed and  delivered  to Alaska,  as
Mortgagee,  a First  Mortgage  and Deed of Trust dated as of August 1, 1960 (the
"Original Mortgage"),  and three mortgages  supplemental thereto consisting of a
Supplemental  Mortgage  dated as  September  9,  1960 (the  "First  Supplemental
Mortgage"),  a Second Supplemental Mortgage dated as of May 1, 1961 (the "Second
Supplemental  Mortgage") and a Third Supplemental  Mortgage dated as of December
15, 1969 (the "Third Supplemental Mortgage");

         WHEREAS,  effective  February 18, 1972, Alaska Interstate  Company,  an
Alaska corporation ("Interstate"),  acquired all of the assets and business as a
going  concern of Service  and in  connection  therewith  entered  into a Fourth
Supplemental  Mortgage dated as of February 18, 1972 ( the "Fourth  Supplemental
Mortgage")  which,  among other  things,  (a)  provided  for the  assumption  by
Interstate of all  obligations,  warranties  and agreements of Service under the
Secured Notes and the Original  Mortgage as supplemented and amended thereby and
by the First Supplemental  Mortgage,  the Second  Supplemental  Mortgage and the
Third  Supplemental  Mortgage,  and (b) restated the terms and provisions of the
Original  Mortgage,  as  supplemented  and  amended  thereby  and by  the  First
Supplemental   Mortgage,   the  Second  Supplemental   Mortgage  and  the  Third
Supplemental Mortgage;

         WHEREAS,   effective  June  4,  1982,  Interstate  merged  into  ENSTAR
Corporation ("ENSTAR"),  and ENSTAR, as the surviving corporation,  succeeded to
all of  Interstate's  right,  title and  interest to the assets and  business of
Service as a going concern,  and assumed all of Interstate's  obligations  under
(a) the Original Mortgage as theretofore  supplemented,  amended and restated by
the First Supplemental  Mortgage,  the Second Supplemental  Mortgage,  the Third
Supplemental  Mortgage,  the Fourth Supplemental  Mortgage, a Fifth Supplemental
Mortgage dated as of November 15, 1975, a Sixth  Supplemental  Mortgage dated as
of December 30, 1977 and a Seventh Supplemental  Mortgage dated as of January 1,
1984 (the Original  Mortgage,  as so supplemented,  amended and restated by such
seven supplemental  mortgages,  being herein called the "Amended  Mortgage") and
(b) the notes of Interstate secured by the Amended Mortgage;

         WHEREAS,  following  such  merger,  the name of Service  was changed to
ENSTAR Natural Gas Company and its  operations  were  thereafter  conducted as a
division (the "Division") of ENSTAR;

         WHEREAS, effective June 17, 1985, the Company purchased from ENSTAR all
of the outstanding  common stock of Alaska and all of the assets and business as
a going  concern of the  Division  pursuant to an Agreement of Purchase and Sale
dated as of October 30, 1984, as amended by a Supplemental  Agreement  dated may
3, 1985;

<PAGE>

         WHEREAS,  in connection  with such  purchase,  the Company,  and Alaska
entered  into an Eighth  Supplemental  Mortgage,  dated as of June 17, 1985 (the
"Eighth  Supplemental  Mortgage"),  providing,  among other things,  for (i) the
amendment and restatement of the Amended Mortgage and (ii) the assumption by the
Company  all the  obligations,  warranties  and  agreements  of  ENSTAR  and the
Division under the Amended Mortgage;

     WHEREAS,  pursuant to the Amended Mortgage,  as amended and restated by the
Eighth  Supplemental  Mortgage (the  "Mortgage"),  the Company  issued to Alaska
certain  promissory notes of the Company (the  "Replacement  Notes") in exchange
for and in  cancellation  and  replacement  of all  promissory  notes of  ENSTAR
secured by the Mortgage (the "ENSTAR Notes");

         WHEREAS,  the Replacement  Notes were issued in renewal,  extension and
refunding  of the ENSTAR  Notes and the lien created by the Mortgage was carried
forward and  continued  in force and effect for the purpose of  securing,  among
other indebtedness, the indebtedness evidenced by the Replacement Notes;

         WHEREAS,  the  Company  and Alaska  desire to amend  certain  terms and
conditions  contained  in the  Mortgage,  and the Company  desires to convey and
mortgage,  and confirm the  conveyancing  and mortgaging  under the Mortgage and
hereunder, of certain properties heretofore acquired by the Company with respect
to  the  operations  of the  Division  and  not  specifically  described  in the
Mortgage,  and, to that end, the Company desires to make, execute and deliver to
Alaska a Ninth Supplemental Mortgage,  supplemental to the Mortgage, in the form
hereof and for the purposes herein provided, which will secure all the Notes (as
defined in Section 1.01 of the Mortgage);

     WHEREAS,  all  conditions  and  requirements  necessary  to  authorize  the
execution,  acknowledgment and delivery of this Ninth Supplemental  Mortgage and
duly and legally to effect the  modifications  of the  Mortgage  provided for in
this Ninth Supplemental  Mortgage and to make the Mortgage,  as supplemented and
amended hereby,  a valid,  binding and legal  instrument for the security of the
Notes ( as defined in Section 1.01 of the Mortgage),  have been compiled with or
have been done and performed;

         NOW, THEREFORE,  in consideration of the premises and of other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the Company and Alaska hereby act and agree as follows:

                                    ARTICLE I

                         Confirmation of Mortgage, etc.

         In order  further to secure (and the Company  hereby  acknowledges  and
agrees that the lien of the Mortgage is hereby carried  forward and continued in
force and effect for the purpose of  securing)  the payment of the  principal of
and the  premium,  if any,  and  interest  on all Notes at any time  issued  and
outstanding  under the Amended  Mortgage,  as  supplemented  and amended by this
Ninth Supplemental  Mortgage and as further supplemented and amended,  from time
to time, in accordance  with their terms,  and the performance and observance by
the

<PAGE>

Company of all of the  obligations  and  agreements  of the  Company  herein and
therein  contained and the payment of all amounts  payable and to become payable
by the Company  under the Gas Sale  Contract  (as defined in Section 1.01 of the
Mortgage),  the Company (i) has executed and delivered  this Ninth  Supplemental
Mortgage,  (ii) does hereby ratify and confirm its mortgage and pledge to Alaska
of its  property  (other  than  Excepted  Property,  as defined in the  Excepted
Property Clause of the Mortgage,  and any property  heretofore released from the
lien of the Mortgage  pursuant thereto and other than easements,  rights-of-way,
permits, leaseholds,  contracts and agreements which have either expired or been
completed in  accordance  with their  terms)  described in the Mortgage as being
subjected  to the  lien  of the  Mortgage  and  has  granted,  bargained,  sold,
released,  conveyed,  assigned,  transferred,  mortgaged,  pledged, set over and
confirmed,  and (iii) does hereby grant, bargain, sell, release, convey, assign,
transfer, mortgage, pledge, set over and confirm unto Alaska, as Mortgagee under
the Mortgage,  and to its successors  and assigns  forever the real property and
interests in real  property  described in Schedule I attached  hereto and made a
part hereof for all purposes.

                                   ARTICLE II

                          Modifications of the Mortgage


         SECTION  2.1.  Section  2.02  Amended.  Section 2.02 of the Mortgage is
hereby  amended  by  adding  the  following  new  paragraph  to the Form of Note
contained in such Section:

         "Anything  in this Note,  the  Mortgage or  elsewhere  to the  contrary
notwithstanding,  Seagull shall not be personally  liable for the payment of the
principal  of,  premium (if any) or interest  on this Note,  it being  expressly
understood  and agreed that the sole recourse of the holder of this Note for the
payment  hereof  shall be against the  Mortgaged  Property  and that no recourse
(whether under rule of law, statute or constitution or by the enforcement of any
assessment  or penalty or otherwise)  shall be had against  Seagull or any other
Person for the payment of the principal of, premium (if any) or interest on this
Note or for any claim based  hereon or otherwise  in respect  hereof;  provided,
however,  that  nothing in this  paragraph  shall (i) affect the validity of the
indebtedness  evidenced by this Note or the rights of any holder of this Note to
proceed  against the Mortgaged  Property in accordance  with the Mortgage,  (ii)
constitute a waiver of any  indebtedness  or  obligation  evidenced by this Note
(but the same shall continue until paid or discharged), (iii) limit or otherwise
prejudice in any way the right of any holder of this Note to name Seagull or any
owner, holder or transferee of any interest in the Mortgaged Property as a party
defendant in any action or suit for judicial  foreclosure of, or in the exercise
of any other  remedy  available  to such holder with  respect to, the  Mortgaged
Property  so long as no  judgment  in the  nature  of a  deficiency  or  seeking
personally  liability  shall  be  asked  of or (if  obtained)  enforced  against
Seagull."

         SECTION  2.2.  Section  3.02  Amended.  Section 3.02 of the Mortgage is
hereby  amended by replacing  the second  paragraph  thereof with the  following
paragraph:
         "Anything  in this  Mortgage,  the Notes or  elsewhere  to the contrary
notwithstanding,  the Company shall not be personally  liable for the payment of
the principal of, premium (if any) or interest on the Notes (whether Replacement
Notes or  otherwise),  it being  expressly  understood  and agreed that the sole
recourse of the holders of the Notes for the

<PAGE>

payment  thereof  shall be against the  Mortgaged  Property and that no recourse
(whether under rule of law, statute or constitution or by the enforcement of any
assessment  or penalty or  otherwise)  shall be had  against  the Company or any
other Person for the payment of the principal  of,  premium (if any) or interest
on the Notes or for any claim  based  hereon or  otherwise  in respect  thereof;
provided,  however, that nothing in this paragraph shall (i) affect the validity
of the indebtedness evidenced by the Notes or the rights of any holder of a Note
to proceed against the Mortgaged Property in accordance with this Mortgage, (ii)
constitute a waiver of any  indebtedness  or  obligation  evidenced by the Notes
(but the same shall continue until paid or discharged), (iii) limit or otherwise
prejudice  in any way the right of any  holder of a Note to name the  Company or
any owner,  holder or transferee of any interest in the Mortgaged  Property as a
party  defendant  in any action or suit for judicial  foreclosure  of, or in the
exercise of any other  remedy  available  to such  holder  with  respect to, the
Mortgaged  Property  so long as no  judgment  in the nature of a  deficiency  or
seeking personally liability shall be asked of or (if obtained) enforced against
the Company."

                                   ARTICLE III

                            Miscellaneous Provisions

     SECTION  3.1.  Titles,  Headings,  Etc.  The  titles  and  headings  of the
Articles,  Sections and  subdivisions of this Ninth  Supplemental  Mortgage have
been inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way  modify or  restrict  any of the terms or  provisions
hereof.

         SECTION  3.2.  Counterparts.  This Ninth  Supplemental  Mortgage may be
executed in any number of counterparts, each of which shall be an
original, but all of which together shall constitute one instrument.

         IN WITNESS  WHEREOF,  the parties  have caused this Ninth  Supplemental
Mortgage to be executed by their respective  officers thereunto duly authorized,
all as of the day and year first above written.

                           SEAGULL ENERGY CORPORATION



                        By:_____________________________


[Corporate Seal]                                Title:__________________________


Attest:


By:___________________________
           Secretary


<PAGE>


                             ALASKA PIPELINE COMPANY


                          By:__________________________

[Corporate Seal]
                          Title:_______________________

Attest:


By:___________________________
           Secretary


STATE OF TEXAS

COUNTY OF HARRIS

         BEFORE ME, the undersigned  authority,  on this day personally appeared
___________________________,  known  to  me to  be  the  person  whose  name  is
subscribed   to  the   foregoing   instrument,   and  known  to  me  to  be  the
___________________________________  of  SEAGULL  ENERGY  CORPORATION,  a  Texas
corporation,  and  acknowledged  to me that he executed said  instrument for the
purposes  and  consideration  therein  expressed,  and in the  capacity  therein
stated,  as the free and voluntary act and deed of the said  corporation for the
uses and purposes therein mentioned.

         Given under my hand and seal of office this _____ day of  ____________,
1991.




                                             -----------------------------------
                            Notary Public in and for
                                                              the State of Texas

[Notarial Seal]
                                           My Commission Expires:_______________


<PAGE>


STATE  OF TEXAS

COUNTY OF HARRIS

     BEFORE ME,  the  undersigned  authority,  on this day  personally  appeared
______________________________,  known  to me to be the  person  whose  name  is
subscribed   to  the   foregoing   instrument,   and  known  to  me  to  be  the
________________________________   of   ALASKA   PIPELINE   COMPANY,   a   Texas
corporation,  and  acknowledge  to me that the executed said  instrument for the
purposes  and  consideration  therein  expressed,  and in the  capacity  therein
stated,  as the free and voluntary act and deed of the said  corporation for the
uses and purposes therein mentioned.

         Given under my hand and seal of office this ______ day of ____________,
1991.



                                             -----------------------------------
                            Notary Public in and for
                                                              the State of Texas

[Notarial Seal]

                                           My Commission Expires:_______________

<PAGE>

SCHEDULE I

     A. The right, title and interest of the Company in the following easements,
rights-of-way,  permits,  licenses,  servitudes,  leases, grants and rights (all
references  hereafter  made to books and pages being to the  Conveyance and Deed
Records of the respective Recording Districts of the State of Alaska), to wit:

                                   [ To Come]

         B. The  right,  title and  interest  of the  Company  in the  following
permits,  licenses,  franchises  and  grants  over,  in, on and across the lands
described and for the purposed stated therein:

                                    [To Come]

         C. The right,  title and interest of the Company in the following  real
property:

                                    [To Come]