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 Quarter Ended June 30, 1999  Commission File No. 1-5591


                       PENNZENERGY COMPANY
     (Exact name of registrant as specified in its charter)


             Delaware                          74-1597290
 (State or other jurisdiction of incorporation or organization)
              (I.R.S. Employer Identification No.)


                  Pennzoil Place, P.O. Box 4616
                   Houston, Texas  77210-4616
             (Address of principal executive offices)



 Registrant's telephone number, including area code:  (713) 546-
                              6000


     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     .

      Number of shares outstanding of each class of stock, as  of
latest practicable date, July 31, 1999:

     Common stock, par value $0.83-1/3 per share, 48,004,379
shares.
      Preferred  stock,  par  value $1.00  per  share,  1,500,000
shares.


<PAGE>
<PAGE>  2

                         PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

<TABLE>
                                                  PENNZENERGY COMPANY
                                      CONDENSED CONSOLIDATED STATEMENT OF INCOME
                                                      (UNAUDITED)
<CAPTION>
                                                                       Three Months Ended                  Six Months Ended
                                                                             June 30                           June 30
                                                                  ----------------------------      ----------------------------
                                                                     1999             1998             1999             1998
                                                                  -----------      -----------      -----------      -----------
                                                                        (Expressed in thousands except per share amounts)
<S>                                                               <C>              <C>              <C>              <C>
REVENUES
   Natural gas sales                                              $   81,456       $   93,674       $  150,884       $  187,494
   Crude oil, condensate and natural gas liquids sales                57,961           55,395          103,846          115,456
   Investment and other income, net                                   55,955           18,794           67,119           37,277
                                                                  -----------      -----------      -----------      -----------
    Total revenues                                                $  195,372       $  167,863       $  321,849       $  340,227
COSTS AND EXPENSES
   Operating expense                                                  44,139           52,026           90,782          104,749
   General and administrative expense                                 10,705            7,278           19,676           16,126
   Depreciation, depletion and amortization                           63,309           54,387          131,450          109,984
   Exploration expense                                                12,803           19,220           25,921           31,895
   Taxes, other than income                                            7,367            7,897           14,268           15,859
   Interest charges, net                                              31,250           40,242           61,811           79,429
                                                                  -----------      -----------      -----------      -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAX            25,799          (13,187)         (22,059)         (17,815)
Income tax provision (benefit)                                         9,939           (7,189)          (9,174)         (12,165)
                                                                  -----------      -----------      -----------      -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS                              15,860           (5,998)         (12,885)          (5,650)
INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX                         -              14,826             -              24,137
                                                                  -----------      -----------      -----------      -----------
NET INCOME (LOSS)                                                     15,860            8,828          (12,885)          18,487
Preferred stock dividends                                              2,434              757            4,868              757
                                                                  -----------      -----------      -----------      -----------
NET INCOME (LOSS) AVAILABLE TO
   COMMON SHAREHOLDERS                                            $   13,426       $    8,071       $  (17,753)      $   17,730
                                                                  ===========      ===========      ===========      ===========

BASIC AND DILUTED INCOME (LOSS) PER SHARE
   Continuing operations                                          $     0.28       $    (0.14)      $    (0.37)      $    (0.13)
   Discontinued operations                                        $      -         $     0.31       $      -         $     0.50
                                                                  -----------      -----------      -----------      -----------
TOTAL BASIC AND DILUTED INCOME (LOSS) PER SHARE                   $     0.28       $     0.17       $    (0.37)      $     0.37
                                                                  ===========      ===========      ===========      ===========

AVERAGE SHARES OUTSTANDING
   Basic                                                              47,958           47,695           47,923           47,643
                                                                  ===========      ===========      ===========      ===========
   Diluted                                                            48,078           47,695           47,923           47,643
                                                                  ===========      ===========      ===========      ===========
END OF PERIOD SHARES OUTSTANDING                                      47,990           47,727           47,990           47,727
                                                                  ===========      ===========      ===========      ===========

DIVIDENDS PER COMMON SHARE                                        $   0.0625       $     0.25       $   0.1250       $     0.50
                                                                  ===========      ===========      ===========      ===========
<FN>
<F1>
See Notes to Condensed Consolidated Financial Statements.
</FN>
</TABLE>



<PAGE>
<PAGE>  3
                         PART I. FINANCIAL INFORMATION - continued
<TABLE>
                                            PENNZENERGY COMPANY
                         CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                                                (UNAUDITED)
<CAPTION>
                                                           Three Months Ended         Six Months Ended
                                                                 June 30                  June 30
                                                         ----------------------  ------------------------
                                                            1999         1998         1999         1998
                                                         ----------  ----------  -----------  -----------
                                                                     (Expressed in thousands)
<S>                                                      <C>        <C>          <C>          <C>

NET INCOME (LOSS)                                        $  15,860   $   8,828   $  (12,885)  $   18,487

Unrealized gains on marketable securities, net of tax       28,653      (1,902)      55,037       (1,501)
Foreign currency translation adjustment and other             (133)     (2,142)        (252)      (3,017)
                                                         ----------   ---------  -----------  -----------
                                                            28,520      (4,044)      54,785       (4,518)
                                                         ----------   ---------  -----------  -----------
COMPREHENSIVE INCOME                                     $  44,380    $  4,784   $   41,900   $   13,969
                                                         ==========   =========  ===========  ===========

<FN>
<F1>
See Notes to Condensed Consolidated Financial Statements.
</FN>
</TABLE>


<PAGE>
<PAGE>  4

                         PART I. FINANCIAL INFORMATION - continued
<TABLE>
                                             PENNZENERGY COMPANY
                                    CONDENSED CONSOLIDATED BALANCE SHEET
                                                 (UNAUDITED)
<CAPTION>
                                                                               June 30,           December 31,
                                                                                1999                  1998
                                                                            -------------        -------------
                                                                                 (Expressed in thousands)

<S>                                                                         <C>                  <C>
                                                  ASSETS

Current assets
   Cash and cash equivalents                                                $      11,980        $      20,439
   Receivables                                                                     83,795               71,553
   Crude oil and natural gas inventories                                            3,583                4,818
   Materials and supplies                                                          12,869               12,354
   Deferred income tax                                                             10,300               10,300
   Other current assets                                                             6,385                8,955
                                                                            -------------        -------------
        Total current assets                                                      128,912              128,419

Property, plant and equipment, net                                              1,616,916            1,658,734
Marketable securities and other investments                                       684,598              598,462
Other assets                                                                       23,680               31,471
                                                                            -------------        -------------

TOTAL ASSETS                                                                $   2,454,106        $   2,417,086
                                                                            =============        =============

                                   LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities
   Accounts payable and accrued liabilities                                 $      95,046        $     127,495
   Interest accrued                                                                24,738               26,093
   Other current liabilities                                                       25,383               24,889
                                                                            -------------        -------------
        Total current liabilities                                                 145,167              178,477
                                                                            -------------        -------------
Long-term debt
   Exchangeable debentures                                                        740,361              739,258
   Other long-term debt                                                           822,652              797,951
                                                                            -------------        -------------
        Total long-term debt                                                    1,563,013            1,537,209
                                                                            -------------        -------------
Deferred income tax                                                               187,257              167,253
Other liabilities                                                                  94,881               99,362
                                                                            -------------        -------------
TOTAL LIABILITIES                                                               1,990,318            1,982,301
                                                                            -------------        -------------
COMMITMENTS AND CONTINGENCIES

MINORITY INTEREST                                                                  38,399               43,696

SHAREHOLDERS' EQUITY                                                              425,389              391,089
                                                                            -------------        -------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                                  $   2,454,106        $   2,417,086
                                                                            =============        =============

<FN>
<F1>
See Notes to Condensed Consolidated Financial Statements.
</FN>
</TABLE>



<PAGE>
<PAGE>  5

                         PART I. FINANCIAL INFORMATION - continued

<TABLE>
                                               PENNZENERGY COMPANY
                                  CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                                    (UNAUDITED)
<CAPTION>

                                                                                        Six Months Ended June 30
                                                                                   ---------------------------------
                                                                                      1999                  1998
                                                                                   -----------           -----------
                                                                                        (Expressed in thousands)
<S>                                                                                <C>                   <C>
CASH FLOWS FROM OPERATING ACTIVITIES
  Net income (loss)                                                                $  (12,885)           $   18,487
  Adjustments to reconcile net income (loss) to net
    cash provided by operating activities:
      Depreciation, depletion and amortization                                        131,450               109,984
      Dry holes and impairments                                                         3,146                12,353
      Deferred income tax                                                              (9,140)               (7,114)
      Income from discontinued operations, net of tax                                    -                  (24,137)
      Gain on sales of assets                                                         (52,247)               (4,296)
      Other non-cash items                                                              3,945                 8,071
      Changes in operating assets and liabilities                                     (45,764)              (66,054)
                                                                                   -----------           -----------
  Net cash provided by operating activities                                            18,505                47,294
                                                                                   -----------           -----------

CASH FLOWS FROM INVESTING ACTIVITIES
  Capital expenditures                                                                (92,378)             (246,696)
  Purchases of marketable securities and other
    investments, net                                                                     (140)               (1,706)
  Proceeds from sales of assets                                                        57,994                34,954
  Other investing activities                                                            1,495               (20,627)
                                                                                   -----------           -----------
  Net cash used in investing activities                                               (33,029)             (234,075)
                                                                                   -----------           -----------

CASH FLOWS FROM FINANCING ACTIVITIES
  Issuance of notes payable, net                                                       24,516                82,342
  Debt repayments                                                                        -                 (818,000)
  Proceeds from issuance of debt                                                         -                  790,000
  Proceeds from issuance of Preferred Stock                                              -                  147,000
  Dividends paid                                                                      (13,293)              (23,828)
  Other financing activities                                                           (5,158)                5,192
                                                                                   -----------           -----------
  Net cash provided by financing activities                                             6,065               182,706
                                                                                   -----------           -----------

NET CASH PROVIDED BY DISCONTINUED OPERATIONS                                             -                    7,422


NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                   (8,459)                3,347

CASH AND CASH EQUIVALENTS, beginning of period                                         20,439                 9,462
                                                                                   -----------           -----------
CASH AND CASH EQUIVALENTS, end of period                                           $   11,980            $   12,809
                                                                                   ===========           ===========


<FN>
<F1>
See Notes to Condensed Consolidated Financial Statements.
</FN>
</TABLE>



<PAGE>
<PAGE>  6

                         PART I. FINANCIAL INFORMATION - continued

                       PENNZENERGY COMPANY
      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                           (UNAUDITED)


(1)  General -

      The  condensed  consolidated financial statements  included
herein  have been prepared by PennzEnergy Company ("PennzEnergy")
without  audit  and  should  be  read  in  conjunction  with  the
financial   statements  and  the  notes   thereto   included   in
PennzEnergy's  latest  annual report.   The  foregoing  financial
statements  include  only  normal  recurring  accruals  and   all
adjustments  which  PennzEnergy considers necessary  for  a  fair
presentation.  Certain prior period items have been  reclassified
in  the  condensed consolidated financial statements in order  to
conform with the current year presentation.

(2)  Discontinued Operations -

      On  December 30, 1998, PennzEnergy, formerly named Pennzoil
Company,  distributed to its shareholders (the  "Spin-off")  47.8
million  shares  of common stock of its wholly  owned  subsidiary
Pennzoil-Quaker   State   Company   ("Pennzoil-Quaker    State"),
representing all of the shares of Pennzoil-Quaker State owned  by
PennzEnergy.
    Accordingly,  Pennzoil-Quaker State's results  of  operations
are  shown net of tax as discontinued operations in PennzEnergy's
condensed  consolidated statement of income for periods presented
prior  to  the  Spin-off.   After-tax  income  from  discontinued
operations,  taxes  on income from discontinued  operations,  and
revenues related to discontinued operations for the quarter ended
June  30,  1998  were  $ 14.8 million, $10.3 million  and  $464.6
million,  respectively.  For the six months ended June 30,  1998,
after-tax  income from discontinued operations, taxes  on  income
from   discontinued   operations,   and   revenues   related   to
discontinued  operations were $24.1 million, $17.5  million,  and
$838.1 million, respectively.

 (3) New  Accounting Standards -

      In  March 1998, the American Institute of Certified  Public
Accountants  issued  Statement  of  Position  ("SOP")  No.  98-1,
"Accounting  for  the  Costs of Computer  Software  Developed  or
Obtained  for  Internal Use."  The adoption of SOP  No.  98-1  on
January  1, 1999 did not have a material impact on  PennzEnergy's
results of operations.
      In  June  1998,  the Financial Accounting  Standards  Board
("FASB")  issued  Statement  of  Financial  Accounting  Standards
("SFAS")  No.  133,  "Accounting for Derivative  Instruments  and
Hedging  Activities."   SFAS No. 133 establishes  accounting  and
reporting standards requiring that every derivative instrument be
recorded  in  the balance sheet as either an asset  or  liability
measured  at  its  fair value.  Changes in  fair  value  must  be
recognized currently in earnings unless specific hedge accounting
criteria  are  met.   Accounting  for  qualifying  hedges  allows
derivative  gains  and losses to offset related  results  on  the
hedged  item in the income statement, and requires a  company  to
formally  document,  designate, and assess the  effectiveness  of
transactions  that receive hedge accounting.   SFAS  No.  133  is
currently  expected  to be effective for fiscal  years  beginning
after  June 15, 2000 and early adoption is permitted.  The effect
of  adopting  SFAS No. 133 has not been determined,  but  is  not
expected  to  have  a material impact on PennzEnergy's  financial
position or results of operations.

(4)  Proposed Merger with Devon Energy Corporation -

     On  May  19,  1999, PennzEnergy entered into an Amended  and
Restated  Agreement  and Plan of Merger (the "Merger  Agreement")
with Devon Energy Corporation ("Devon").  Under the terms of  the
Merger Agreement, PennzEnergy and Devon will engage in a business
combination  transaction in which PennzEnergy will merge  into  a
"new"  Devon  Energy Corporation ("New Devon"),  incorporated  in
Delaware, and Devon will become a wholly owned subsidiary of  New

<PAGE>
<PAGE>  7

                         PART I. FINANCIAL INFORMATION - continued

Devon.   As  a  result of the transaction, each  share  of  Devon
common stock will be converted into one share of common stock  of
New  Devon  and  each share of PennzEnergy common stock  will  be
converted  into  0.4475  shares of common  stock  of  New  Devon.
PennzEnergy shareholders will own approximately 31 percent of the
combined company and Devon shareholders will own approximately 69
percent.   The percentages will be reduced if New Devon completes
a  planned  public offering of $300 million to  $500  million  of
newly issued shares of New Devon common stock.
     The  transaction is subject to approval by majority vote  of
the  outstanding  shares of both companies  and  other  customary
closing conditions.  PennzEnergy has received notice of the early
termination of the Hart-Scott-Rodino waiting period.  The  merger
is  currently expected to be consumated during the third  quarter
of 1999.

(5)  Debt -

     PennzEnergy has two series of exchangeable debentures.  Each
4.90%  Debenture and 4.95% Debenture is exchangeable into  9.3283
shares  of Chevron Corporation ("Chevron") common stock,  matures
on August 15, 2008 and is not callable until August 15, 2000. The
4.90% Debentures and the 4.95% Debentures are exchangeable at the
option  of  the  holders at any time prior  to  maturity,  unless
previously redeemed, for shares of Chevron common stock.  In lieu
of  delivering  Chevron  common stock, PennzEnergy  may,  at  its
option,  pay to any holder an amount in cash equal to the  market
value  of  the  underlying Chevron common stock  to  satisfy  the
exchange  request.   Changes  in the  fair  value  of  the  4.90%
Debentures  and the 4.95% Debentures associated with fluctuations
in  the  price of Chevron common stock will be recorded in income
if  and  when  the market value of the underlying Chevron  common
stock exceeds $107.20 per share.
     PennzEnergy's $200 million of 9.625% Debentures due November
1999  and $24.5      million borrowed under variable-rate  credit
arrangements  are  classified  as  long-term  debt   based   upon
availability   of  committed  long-term  credit   facilities   to
refinance such amounts and PennzEnergy's intent to maintain  such
commitments in excess of one year.

(6)  Earnings Per Share -

     Earnings  per  share  computations to  reconcile  basic  and
diluted income (loss) from continuing operations consist  of  the
following:


<TABLE>
                                                           Three Months Ended         Six Months Ended
                                                                 June 30                  June 30
                                                         ----------------------  ------------------------
                                                            1999         1998         1999         1998
                                                         ----------  ----------  -----------  -----------
                                                         (Expressed in thousands except per share amounts)
<S>                                                      <C>        <C>          <C>          <C>

Income (loss) from continuing operations                 $  15,860   $  (5,998)  $  (12,885)  $   (5,650)
Less: Preferred stock dividends                              2,434         757        4,868          757
                                                         ----------  ----------  -----------  -----------
Income (loss) from continuing operations available to
      common shareholders                                $  13,426    $ (6,755)  $  (17,753)  $   (6,407)
                                                         ==========  ==========  ===========  ===========
Basic weighted average shares outstanding                   47,958      47,695       47,923       47,643

Effect of dilutive securities (1):
      Options                                                  -           -            -            -
      Awards                                                   120         -            -            -
                                                         ----------  ----------  -----------  -----------
Diluted weighted average shares outstanding                 48,078      47,695       47,923       47,643
                                                         ==========  ==========  ===========  ===========
Income (loss) per share from continuing operations:
      Basic                                              $    0.28   $   (0.14)  $    (0.37)  $    (0.13)
                                                         ==========  ==========  ===========  ===========
      Diluted                                            $    0.28   $   (0.14)  $    (0.37)  $    (0.13)
                                                         ==========  ==========  ===========  ===========

<PAGE>
<PAGE>  8

                         PART I. FINANCIAL INFORMATION - continued

<FN>
<F1> A  weighted average number of options to purchase  4,657,108
     shares of common stock were outstanding for the three months
     ended June 30, 1999 but were not included in the computation
     of  diluted  income per share because the options'  exercise
     prices  were  greater than the average market price  of  the
     common  shares.   A weighted average number  of  options  to
     purchase  3,542,744  shares of common stock  and  awards  of
     147,422  shares  of  common stock were outstanding  for  the
     three  months ended June 30, 1998 but were not  included  in
     the  computation  of  diluted loss per share  because  these
     options and awards would result in an antidilutive per share
     amount.   A  weighted average number of options to  purchase
     4,653,413 and 3,575,784 shares of common stock and awards of
     122,166  and 147,612 shares of common stock were outstanding
     for   the   six  months  ended  June  30,  1999  and   1998,
     respectively,  but were not included in the  computation  of
     diluted  loss  per  share because these options  and  awards
     would result in an antidilutive per share amount.

</FN>
</TABLE>

(7)  Acquisitions and Divestitures -

     On June 30, 1999 PennzEnergy sold approximately 38,200 acres
of land, timber, and  mineral rights located in  Pennsylvania and
New  York to Seneca  Resources  Corporation,  Highland  Land  and
Minerals, Inc. and  Patterson  Lumber Company, Inc. and  received
cash proceeds of $49.5 million. These sales resulted in an after-
tax  gain  of $29.8 million.  Additional cash  proceeds  of  $3.9
million from additional sales of land and timber were received in
July 1999 resulting in an after-tax gain of $2.3 million.

(8)  Related Party Transactions -

     As a result of the Spin-off, PennzEnergy and Pennzoil-Quaker
State  have   an   arrangement   to   share   certain   corporate
administrative services for a  period of up to one year after the
date of the Spin-off.  Fees are paid  based upon  actual costs of
providing these services.



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

Results of  Operations

      PennzEnergy  reported net income of $15.9 million  for  the
second  quarter of 1999 and a net loss of $12.9 million, for  the
six  months ended June 30, 1999, compared to net income of   $8.8
million  and $18.5 million, respectively for the quarter and  six
months  ended  June  30, 1998. After preferred  dividends,  basic
earnings  per  share for the second quarter and six months  ended
June  30, 1999 were $.28 per share and a loss of $.37 per  share,
respectively.  Basic earnings per share for the quarter  and  six
months  ended  June  30, 1998 were $.17 per share  and  $.37  per
share,  respectively,  and included $14.8 million,  or  $.31  per
share  and  $24.1  million, or $.50 per share,  respectively,  of
income from discontinued operations.  Reference is made to Note 2
of Notes to Condensed Consolidated Financial Statements.
      Excluding discontinued operations, the increase  in  pretax
income  for the quarter ended June 30, 1999 compared to the  same
period  in 1998 is primarily due to a gain on the sale of assets,
higher  realized liquids prices and lower interest expense  which
were   partially   offset  by  lower  dividend   income,   higher
depreciation,  depletion and amortization ("DD&A")  rates,  lower
production  volumes and lower realized gas prices.  The  decrease
in  pretax income for the six months ended June 30, 1999 compared
to the same period in 1998 is primarily due to lower realized gas
and  liquids prices, lower production volumes, higher DD&A  rates
and  lower dividend income which were partially offset by a  gain
on the sale of assets and lower interest expense.

<PAGE>
<PAGE>  9

                         PART I. FINANCIAL INFORMATION - continued

     Natural  gas price realizations averaged $1.99 per  thousand
cubic feet ("Mcf") and $1.83      per Mcf, respectively, for  the
quarter and six months ended June 30, 1999, compared to $2.12 per
Mcf  and  $2.09  per Mcf, respectively, for the same  periods  in
1998.  Liquids price realizations averaged $13.31 per barrel  and
$11.32  per barrel for the quarter and six months ended June  30,
1999,  compared  to  $11.00 per barrel  and  $11.70  per  barrel,
respectively, for the same periods in 1998.  Natural gas  volumes
produced for sale were 446.9 million cubic feet ("MMcf") per  day
and  453.3  MMcf per day, respectively, for the quarter  and  six
months  ended June 30, 1999, compared to 481.8 MMcf per  day  and
490.6  MMcf per day, respectively, for the same periods in  1998.
Liquids  production volumes were 47.8 thousand barrels  ("Mbbls")
per day and 50.7 Mbbls per day, respectively, for the quarter and
six  months ended June 30, 1999, compared to 55.3 Mbbls  per  day
and  54.5  Mbbls per day, respectively, for the same  periods  in
1998.
     The  decrease in production volumes for the quarter and  six
months  ended June 30, 1999 compared to the same periods in  1998
is  primarily due to production declines offshore at West Cameron
580.   On  a  barrel of oil equivalent ("boe") basis,  production
declined from 135,600 boe per day and 136,300 boe per day for the
second  quarter and six months ended June 30, 1998, respectively,
to  122,300  boe per day and 126,200 boe per day for  the  second
quarter and six months ended June 30, 1999, respectively.
     On  June  30,  1999,  PennzEnergy sold approximately  36,300
acres  of land, timber and mineral rights located in Pennsylvania
and  New  York to Seneca Resources Corporation and Highland  Land
and  Minerals, Inc. and received proceeds of $47.5 million.  Also
in  June, PennzEnergy sold approximately 1,900 acres of land  and
timber located in Pennsylvania to Patterson Lumber Company, Inc.,
and received cash proceeds of $2.0 million.  These sales resulted
in  an after-tax gain of $29.8 million.  Additional proceeds from
sales  of  land  and timber were received in July  1999  totaling
approximately $3.9 million. These July sales resulted in an after-
tax gain of $2.3 million.
      Operating  costs,  including corporate  overhead,  averaged
$5.59  per  boe and $5.46 per boe for the quarter and six  months
ended  June 30, 1999 compared to $5.44 per boe and $5.54 per  boe
for  the  quarter  and  six months ended June  30,  1998.   Total
operating  and  general  and administrative  expenses  were  $5.0
million  lower in the second quarter of 1999 than in  the  second
quarter of 1998, and $12.0 million lower for the six months ended
June  30,  1999  as compared to the same period last  year.   The
reductions in each of these periods were primarily due  to  lower
offshore workover and platform repair expenses.
      DD&A rates increased from $4.41 per boe and $4.46 per  boe,
respectively, for the quarter and six months ended June 30,  1998
to  $5.69  per boe and $5.75 per boe, respectively, for the  same
periods  in 1999. These increases were primarily due to  negative
oil and gas proved reserve revisions at year-end 1998.
     Capital expenditures for the second quarter of 1999 were $41
million, $89 million below the second quarter of 1998.   For  the
six  months ended June 30, 1999, capital expenditures totaled $92
million,  $154  million  below the  same  period  in  1998.   The
decrease  in  capital expenditures during 1999  was  primarily  a
result  of lower domestic offshore and international spending  in
response to lower commodity prices.
     Onshore  domestically, PennzEnergy is currently  focused  on
accelerating exploration and development of its assets  in  south
Louisiana,  south  Texas  and the Raton Basin  while  working  to
preserve  capital  and reduce overall risk.   At  the  same  time
PennzEnergy  is  emphasizing low-cost,  low-risk  production  and
reserves enhancement on its developed properties.
     In  south  Louisiana  at  the Patterson  and  Redfish  Point
fields,  production  began  on two successful  exploration  wells
completed  in  the second quarter of 1999.  Production  from  the
Patterson  exploration well was temporarily  interrupted  due  to
mechanical problems while producing 15.0 gross MMcf per day,  but
is currently back on line unloading 5.2 gross MMcf per day and 70
gross  barrels  of  condensate per  day.   The  recently  drilled
Redfish  Point well continues to produce 3.3 gross MMcf  per  day
and 850 gross barrels of condensate per day. PennzEnergy holds  a
50% working interest in each of these wells.  A third exploratory
well,  funded  100% by a third party and drilled  in  Plaquemines

<PAGE>
<PAGE>  10

                         PART I. FINANCIAL INFORMATION - continued

Parish,  resulted in a dry hole.  An additional exploration  well
at  the  Patterson field was spudded in August 1999.  Acquisition
of  3-D seismic is nearing completion on PennzEnergy's Quarantine
Bay  field  area with delivery expected in the fourth quarter  of
1999.   Recent  seismic  trades and  acquisitions  will  increase
PennzEnergy's  total 3-D seismic database in south  Louisiana  to
574 square miles.
     In  south  Texas, PennzEnergy is currently  drilling  a  new
fault block on its Haynes lease in Zapata County, upthrown to the
new  Haynes JRS field, established in 1998.  Exploration wildcats
are also underway in Refugio and Zapata Counties.  In the central
Texas Wilcox Trend, 3-D seismic is currently being shot and  will
be  delivered later this year covering PennzEnergy's 23,000  acre
Ray Ranch area in Bee, Goliad and Karnes counties.
     In the Carthage-Bethany area of northeast Texas, PennzEnergy
is currently operating a three-rig drilling program.  PennzEnergy
spudded 11 development wells during the first quarter of 1999 and
another   11  during  the  second  quarter.   An  additional   13
development  wells are scheduled for the remainder of  the  year.
All of the wells drilled in this area during the first six months
of 1999 have been successful.
    On March 22, 1999, PennzEnergy announced a joint venture with
Sonat   Exploration,  Inc.  ("Sonat")  to  develop  the   mineral
interests underlying the Vermejo Park Ranch in the Raton Basin of
northeast  New  Mexico and southern Colorado.   PennzEnergy  will
initially  hold a 25% working interest in the joint  venture  but
will  increase  its  working  interest  to  50%  as  the  project
progresses.  PennzEnergy will also retain a 25% royalty interest.
Sonat  will  bear  all pipeline-related capital expenditures  and
will  pay  up to $10 million to PennzEnergy in progress  bonuses.
The  joint  venture  will  initially be operated  by  Sonat  with
PennzEnergy  taking  over  operations  as  its  working  interest
increases.  PennzEnergy and Sonat expect to drill a minimum of 35
wells in 1999, eight of which were spudded in the second quarter.
The  joint  venture currently expects to drill a  minimum  of  80
wells  in  2000  and  150  wells per year thereafter,  until  the
project  is complete.  Initial pipeline construction is scheduled
for  completion  in  the third quarter of  1999.   The  coal  bed
methane  reserve potential on PennzEnergy's acreage is  estimated
to  be  at  least  one  trillion cubic feet  of  recoverable  gas
reserves.  Initial production is expected to begin in late August
and  increase to a 1999 exit rate of approximately 5.0 gross MMcf
per  day,  restricted  by  third party  pipeline  and  processing
constraints.  PennzEnergy currently holds a before payout working
interest of 25% with a 42.75% net revenue interest.
     Offshore  domestically,  PennzEnergy  is  working  to  lower
overall  capital costs and operating expenses.  PennzEnergy  also
plans  to  remain  active in offshore lease sales  and  acquiring
seismic data in order to build an inventory of prospects for  the
future.
     PennzEnergy has started development of the Garden Banks  161
discovery  as  a two-well subsea facility in 972 feet  of  water.
PennzEnergy holds a 35% working interest and is operator  of  the
block.  Production is expected in the fourth quarter of 1999.   A
third  party  will fund a portion of PennzEnergy's share  of  the
development expenses.  A Minerals Management Service decision  on
a royalty relief application is pending.
     At  Ship  Shoal 198, Halliburton Energy Services funded  and
drilled one new well and recompleted three existing wells under a
production  development agreement with PennzEnergy.  The  current
incremental gas rate associated with this program is 19 net  MMcf
per day.
       Drilling  operations  have been completed  on  the  Shell-
operated Garden Banks 127/128 Enchilada/Chimichanga field.   Both
the A-8 and A-9 wells were successfully completed in 1999 and are
currently  testing at gross rates of 4.2 MMcf per  day  and  19.8
MMcf  per  day,  respectively.  Total gross production  from  the
field is currently 90.3 MMcf per day and 3,500 barrels of liquids
per  day.   PennzEnergy  holds a 20%  working  interest  in  this
subsalt field in 670 feet of water.
     PennzEnergy  is continuing development at the  West  Cameron
580  field with the drilling of the A-4 well. The projected total
depth  of this well was reached in early August.  The well should
be  completed  and on production by October 1.  Expected  initial

<PAGE>
<PAGE>  11

                         PART I. FINANCIAL INFORMATION - continued

production  is  estimated at 30 gross MMcf per day.   PennzEnergy
currently holds an 80% working interest.
     PennzEnergy  recently  completed the drilling  of  the  West
Cameron  533 A-10 well.  This well was completed in  a  600  foot
horizontal  section  in  the 1,500 foot  sand  and  is  currently
producing  13  net MMcf per day.  The success of this  horizontal
well  has  led  to additional opportunities in the  West  Cameron
533/534  area  and additional drilling is being planned  for  the
fourth quarter of 1999.
      Internationally, in May, PennzEnergy (30% working interest)
was  named  as  operator of Block BSeal 4 in the  Sergipe-Alagoas
Basin offshore Brazil. PennzEnergy began a 380 square kilometer 3-
D  seismic acquisition program in July in preparation to drill  a
commitment exploratory well in 2000.
     In  Egypt,  the development plan for North July field  (100%
working interest) was submitted to the Egyptian General Petroleum
Corporation  ("EGPC") in June and approved  in  July  1999.   The
joint  operating  company, Fanar Petroleum Company  ("Fanpetco"),
consisting  of  PennzEnergy  and EGPC  was  formed  in  July.   A
platform  usage  agreement was signed with BP/Amoco  in  July  to
route   the  production  from  North  July  field  through  their
facilities  on  the "July 10" platform.  On the  West  Beni  Suef
concession,  PennzEnergy  is continuing its  seismic  acquisition
program  with the first exploratory well planned for early  2000.
PennzEnergy   relinquished  its  interest  in  the  West   Feiran
concession,  which  resulted  in an  impairment  charge  of  $1.7
million in the second quarter of 1999.
     Offshore Qatar, PennzEnergy (75% working interest) completed
the  acquisition of 200 square kilometers of 3-D seismic  on  the
Block   8  concession  in  April.   The  seismic  data  will   be
interpreted  this  year  and  a commitment  exploratory  well  is
planned for 2000.
     In  the  second quarter, PennzEnergy drilled five  appraisal
wells  in  Lake Maracaibo, Venezuela.  Two of the wells  were  in
block  B2X-70/80 (45% working interest) and three wells  were  on
block  B2X-68/79  (54%  working interest).   Each  of  the  wells
encountered the primary B2X formation as anticipated and  two  of
the  wells  tested  deeper sections with unsatisfactory  results.
Two additional appraisal wells were drilled in July, with all the
appraisal  wells on production by the end of the  third  quarter.
At  the  end  of the second quarter, net production in  Venezuela
averaged 3,000 barrels of oil per day.
     The Azerbaijan International Operating Company ("AIOC"),  in
which  PennzEnergy  has  a  4.8% carried  interest,  exported  an
average  of 84,000 barrels of oil per day for the second quarter.
Daily  oil  production  at  Azeri-Chirag-Gunashli  ("ACG")  field
averaged  92,000 barrels per day for the quarter.  Oil production
is  expected to average approximately 100,000 barrels per day for
the  rest  of 1999, limited by the lack of facilities to evacuate
all  of  the  gas  produced  at ACG.  PennzEnergy  received  $1.3
million in additional net payment for reimbursement of past costs
associated with a gas utilization project for the Gunashli  field
in the second quarter.  These proceeds were recorded as a gain on
sale.

Other

      PennzEnergy's  investment and other  income,  net  for  the
quarter  and  six  months ended June 30, 1999  includes  dividend
income  of $4.3 million and $8.6 million, respectively, from  its
investment in Chevron common stock compared to $10.9 million  and
$21.8 million, respectively, for the quarter and six months ended
June   30,   1998.   In  1998,  PennzEnergy  sold  or   exchanged
approximately  10.7  million shares of Chevron  common  stock  in
conjunction   with   an  exchange  offer  for  its   exchangeable
debentures.
      Net  interest expense for the quarter and six months  ended
June  30,  1999 totaled $31.3         million and $61.8  million,
respectively,  compared  to  $40.2  million  and  $79.4  million,
respectively,  for  the same periods in 1998.   The  decrease  in
interest  expense  was  primarily due to the  reduction  of  debt
associated  with  the  early extinguishment  of  6.5%  and  4.75%
exchangeable debentures and the spin-off of Pennzoil-Quaker State
in 1998.

<PAGE>
<PAGE>  12

                         PART I. FINANCIAL INFORMATION - continued

Capital Resources and Liquidity

      Cash  Flow.  As of June 30, 1999, PennzEnergy had cash  and
cash  equivalents of $12.0 million.  During the six months  ended
June  30, 1999, cash and cash equivalents decreased $8.5 million.
PennzEnergy's  cash  flow  from  operations  before  changes   in
operating  assets  and liabilities and cash  exploration  expense
totaled  $87.0  million for the six months ended June  30,  1999,
compared  to  $132.9 million for the six months  ended  June  30,
1998.
       Debt   Instruments  and  Repayments.    Borrowings   under
PennzEnergy's  variable-rate credit  arrangements  totaled  $24.5
million as of June 30, 1999, all of which has been classified  as
long-term  debt along with $200 million of 9.625% Debentures  due
November  1999 based upon the availability of committed long-term
credit  facilities  to refinance such amounts  and  PennzEnergy's
intent  to  maintain  such commitments in  excess  of  one  year.
PennzEnergy had no outstanding borrowings under its $500  million
committed  revolving  credit facility  at  June  30,  1999.   The
revolving  credit facility contains covenants relating to  liens,
sales  of  assets  and  mergers  and  consolidations,  subsidiary
indebtedness,   acquisitions  and   leverage.    PennzEnergy   is
currently  in  compliance with these covenants in  its  revolving
credit facility.
      Derivative  Instruments.  During  April  1999,  PennzEnergy
entered  into swaps to hedge 18,000 barrels of crude oil per  day
for  May  and  June 1999 at an average of $17.26 per  barrel  and
$17.15   per  barrel,  respectively.   In  addition,  PennzEnergy
entered into swaps to hedge approximately 165 MMcf of natural gas
per  day for May and June 1999 at an average of $2.21 per Mcf and
$2.25  per  Mcf,  respectively.  PennzEnergy  also  entered  into
collar  transactions for 19 MMcf per day of natural gas  for  May
and  June 1999.  The collar transactions fixed a minimum  natural
gas price of $2.16 per Mcf for the two month period and a maximum
price  of $2.30 per Mcf and $2.38 per Mcf for May and June  1999,
respectively.   As a result of these transactions,  PennzEnergy's
revenues  were reduced by $1.8 million in the second  quarter  of
1999.  PennzEnergy does not currently have any of its future  oil
and  gas production hedged.  PennzEnergy did not hedge any of its
crude oil or natural gas production in the first quarter of 1999.

Year 2000

      PennzEnergy  has  completed a review of  its  key  computer
systems and identified a number of systems that would be affected
by the year 2000 compliance issue.  PennzEnergy is undertaking or
has  completed  conversions or upgrades  of  these  non-compliant
financial,  operating, human resources, payroll and seismic  data
systems.  The only conversions and upgrades remaining are  for  a
division order report, a petroleum reserves data extract program,
and  a  billing  system  for a retail gas  operation,  which  are
targeted  for completion by the first of October 1999 or  sooner,
after compliant upgrades are received from the vendors. A vendor-
supplied seismic dataset containing land and contract information
will be converted from a two-digit to a four-digit year when  the
dataset  is  available as a four-digit year from the vendor,  now
scheduled  for  November 1999.  Validation testing  of  financial
support  systems such as tax reporting and reconciliation systems
will  be  completed  by  the end of August  1999.   Upgrades  and
standardization   to   network,   infrastructure,   desktop   and
communications  systems  to  make  these  assets  compliant  were
completed in the second quarter of 1999 following the release  of
compliant  updates from the vendors.  International  as  well  as
domestic   sites   were  included  in  these  assessments.    The
assessment  and remediation of specialized hardware and  software
unique  to an international location was completed by the end  of
the  second quarter of 1999 for all locations with the  exception
of  a drilling information system for one country.  An upgrade to
this  system  was deferred until November 1999 due  to  scheduled
operational  activity.   The only system replacements  that  have
been  accelerated  to  remedy  non-compliance  are  some  of  the
PennzEnergy  voicemail systems and security  systems.   No  major
information technology ("IT") projects have been deferred due  to
year  2000 compliance issues. The validation phase that  consists
of   testing   mission-critical  and  significant   systems   was

<PAGE>
<PAGE>  13

                         PART I. FINANCIAL INFORMATION - continued

essentially  completed by June 1999, with the  exception  of  the
geoscience systems, the retail gas billing system, and  financial
support  systems  mentioned above.  Contingency planning  started
for  the IT systems during the first quarter of 1999 and includes
backup,  standby  and  storage service solutions  to  reduce  the
impact of critical service providers.
       PennzEnergy  also  completed  a  comprehensive  inventory,
assessment,  and renovation of systems and devices with  embedded
chips   in   the   exploration,  production  and   non-production
facilities.  The exploration and production facilities consist of
offshore  platforms, onshore installations, gas plants,  regional
pipelines and a natural gas retail distribution operation.  These
facilities,  which include the processing, storage, and  movement
of  oil  and  natural  gas, have the greatest  inherent  risk  of
production  curtailment since embedded chip systems  control  and
monitor   these  processes.  Several  of  PennzEnergy's   onshore
exploration and production facilities had non-compliant  metering
and control equipment.  These deficiencies have been addressed by
upgrading  or  replacing the non-compliant  portion  of  mission-
critical equipment.  This effort was completed by the end of July
1999.   Non mission-critical production equipment that  may  have
non-compliant   components  is  being  replaced  with   compliant
components  during  normal maintenance and  repair  outages  that
occur  through  1999.  If, for any reason, these systems  do  not
receive maintenance prior to the millennium or are still found to
be non-compliant after the millennium, they will be operated in a
manual  mode  until further renovation and testing is  completed.
In  addition, all currently compliant control systems  that  have
potential  for  environmental, safety, or  business  interruption
impact will be tested during scheduled maintenance.  The majority
of  this  type  of production equipment is used  to  monitor  and
control  production  only.   Nevertheless,  operation  of   these
systems would still be reduced or discontinued if a component  is
found  to  be  non-compliant  in  order  to  prevent  safety  and
environmental problems.  Contingency planning is also underway to
provide alternatives in the event these systems are partially  or
completely  inoperable.  Spare components  are  being  tested  to
ensure compliant systems remain compliant through the maintenance
process.
      PennzEnergy  has  contacted and continues  to  monitor  key
suppliers, banks, customers and other unaffiliated companies that
have business relationships with PennzEnergy to assess their year
2000   compliance  programs.   PennzEnergy  could  be   adversely
affected  by  the  failure  of these  unaffiliated  companies  to
adequately address the year 2000 issue.  This assessment includes
activities  such as face-to-face meetings, reviews of  year  2000
readiness and co-operative testing.  Contingency planning will be
included  in this assessment to identify arrangements to mitigate
the  impact of disruptions from outside sources. This process  is
targeted  for  completion  by the  end  of  September  1999.   In
addition,  PennzEnergy  has implemented  internal  procedures  to
respond  cooperatively to inquiries from regulatory agencies  and
other businesses about its year 2000 program.
      As with most companies, PennzEnergy anticipates more issues
arising from international business partners, especially  in  the
banking, utility, shipping and governmental segments. PennzEnergy
has   reviewed   all   banking  relationships  in   international
locations.   In addition, PennzEnergy is actively involved  in  a
joint industry effort through the American Petroleum Institute to
collectively  address  the  readiness of  their  common  business
partners  such  as  utilities and governmental agencies,  and  to
share  approaches  to  solving  the  specific  problems  of  each
international location.
      If  these steps are not completed successfully in a  timely
manner, PennzEnergy's operations and financial performance  could
be  adversely affected through disruptions in operations.   Costs
associated with such disruptions currently cannot be estimated.
      Both  incremental  historical and  estimated  future  costs
related to the year 2000 issue are not expected to be material to
the  financial results of PennzEnergy for several reasons.   Most
of the renovation is being accomplished with upgrades to existing
software that is under maintenance contracts.  The implementation
of  the major IT systems was not accelerated to remedy year  2000
problems.   Independent quality assurance services and tools  are
being used to assure the reliability of the assessment and costs.

<PAGE>
<PAGE>  14

                         PART I. FINANCIAL INFORMATION - continued

These  services will be supplemented with PennzEnergy  resources.
Costs for all year 2000 activities are estimated to be less  than
$5   million.   This  estimate  does  not  include  PennzEnergy's
potential  share  of  year 2000 costs that  may  be  incurred  by
partnerships and joint ventures in which the company participates
but is not the operator.
      PennzEnergy's existing contingency plan will be modified to
address year 2000 issues by August 1999.  It will be re-evaluated
in  the  fourth  quarter  of 1999, using the  latest  information
available   for   infrastructure  services  such  as   utilities.
Adjustments to this plan will be made based on this information.
     PennzEnergy's year 2000 program was essentially completed by
July 31, 1999, with the exception of the geoscience systems,  the
retail  gas  billing  system,  the validation  of  the  financial
support  systems,  the  land and contract  data  conversion,  and
contingency planning.  Readers are cautioned that forward-looking
statements contained in this year 2000 update should be  read  in
conjunction  with  the company's disclosures under  the  heading:
"Forward-Looking Statements - Safe Harbor Provisions."

Forward-Looking Statements - Safe Harbor Provisions

      This  quarterly report on Form 10-Q of PennzEnergy for  the
quarter  ended  June  30,  1999 contains certain  forward-looking
statements  within the meaning of Section 27A of  the  Securities
Act  of  1933,  as  amended, and Section 21E  of  the  Securities
Exchange  Act  of  1934, as amended, which  are  intended  to  be
covered by the safe harbors created thereby.  To the extent  that
such  statements  are  not recitations of historical  fact,  such
statements  constitute  forward-looking  statements   which,   by
definition,  involve  risks  and uncertainties.   Where,  in  any
forward-looking statements, PennzEnergy expresses an  expectation
or  belief  as  to future results or events, such expectation  or
belief  is  expressed  in  good faith  and  believed  to  have  a
reasonable  basis,  but  there  can  be  no  assurance  that  the
statement of expectation or belief will result or be achieved  or
accomplished.
     The following are factors that could cause actual results or
events  to differ materially from those anticipated, and  include
but  are not limited to: general economic, financial and business
conditions; commodity prices for natural gas and crude  oil;  the
effect   of  weather  on  natural  gas  demand  and  consumption;
competition  for  international drilling  rights;  the  costs  of
exploration  and  development of petroleum reserves;  exploration
risks;  political  risks impacting exploration  and  development;
unanticipated   environmental   liabilities;   changes   in   and
compliance  with governmental regulations; changes in  tax  laws;
and the cost and effects of legal proceedings.










<PAGE>
<PAGE>  15

                         PART II. OTHER INFORMATION

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


(a)  Annual Meeting of Shareholders
          May 6, 1999


(c)  Proposals                     For      Against    Withheld    Abstain

[S]                            [C]          [C]        [C]         [C]
Election of Directors
Robert A. Mosbacher, Jr.       41,215,545         -     974,654       -
Terry L. Savage                41,219,621         -     970,578       -
Robert B. Weaver               41,215,371         -     974,828       -

Approval of Appointment of
Arthur Andersen LLP
As Independent Public
Accountants                    41,804,488     294,361      -        91,350

Amendment of the Restated
Certificate of Incorporation   28,768,209   1,219,492      -       100,451



<PAGE>
<PAGE>  16

Item 6.  Exhibits and Reports on Form 8-K

(a)   Exhibits -

       3    Certificate of Amendment  to the  Restated
      Certificate of Incorporation, as amended through
      May 6, 1999

       27   Financial Data Schedule

(b)   Reports -

   No reports on Form 8-K were filed during the quarter for
   which this report was filed.


<PAGE>
<PAGE>  17
                            SIGNATURE



          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.




                                   PENNZENERGY COMPANY
                                       Registrant




                                   S/N Malcolm R. Rae
                                   Malcolm R. Rae
                                   Controller




August 12, 1999