<PAGE>

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

                           FORM 10-Q

(Mark One)

[X]  QUARTERLY  REPORT  UNDER SECTION  13  OR  15  (d)  OF  THE
     SECURITIES EXCHANGE ACT OF 1934

     For the Quarterly Period Ended September 30, 1998

     OR

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

     For the Transition Period from             to
                                  -----------    -----------

                  Commission File No. 1-12905


                        EEX CORPORATION
    (Exact name of Registrant as specified in its charter)

                             Texas
(State or other jurisdiction of incorporation or organization)

                          75-2421863
             (I.R.S. Employer Identification No.)

     2500 CityWest Blvd., Suite 1400, Houston, Texas 77042
      (Address of principal executive office) (Zip Code)

                        (713) 243-3100
     (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
twelve  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 of Common Stock of Registrant outstanding  as
of November 9, 1998:  127,150,427


<PAGE>

                PART I.  FINANCIAL INFORMATION


Item 1.  Financial Statements



[CAPTION]

                        EEX CORPORATION
  CONDENSED STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)

                                     Three Months Ended    Nine Months Ended
                                        September 30          September 30
                                    -------------------    -----------------

                                        1998     1997        1998    1997
                                        --------------       --------------
                                    (In thousands except per share amounts)
[S]                                  [C]       [C]        [C]       [C]
Revenues
 Natural gas                         $ 22,913  $ 51,175   $100,770  $154,826
 Oil and condensate                    18,487    21,866     56,339    71,230
 Natural gas liquids                      422     2,177      1,467     4,968
 Cogeneration operations                4,159     2,912     10,123     8,387
 Other                                    342       100        698       883
                                     --------  --------   --------  --------
   Total                               46,323    78,230    169,397   240,294
                                     --------  --------   --------  --------
Costs and Expenses
 Production and operating              11,941    12,267     35,495    37,317
 Exploration                           11,345    25,192     37,600    65,213
 Depreciation and amortization         21,771    38,604     77,415   112,353
  Impairment  of producing oil
       and gas properties                       210,202              210,202
  Loss (gain) on sales of property,
       plant & equipment               (3,000)   (8,003)     1,266    (8,003)
 Cogeneration  operations               2,879     2,584      7,679     7,742
 General, administrative and other      6,240    31,939     19,057    48,593
 Taxes, other than income               2,245     4,670      9,636    13,624
                                     --------  --------   --------   --------
   Total                               53,421   317,455    188,148   487,041
                                     --------  --------   --------   --------
Operating (Loss)                       (7,098) (239,225)   (18,751) (246,747)
Other Income (Expense) - Net               73       (79)        59      (150)
Interest Income                            12       383        374       469
Interest and Other Financing Costs     (4,138)   (8,804)   (14,162)  (25,502)
                                     --------- ---------  --------   --------
(Loss) Before Income Taxes            (11,151) (247,725)   (32,480) (271,930)
Income Tax (Benefit)                   (5,699)  (66,190)    (4,127)  (74,665)
Minority Interest                                   (73)    (6,532)      (73)
                                     --------  --------   --------   --------
Net  (Loss)                         $  (5,452)$(181,608)  $(34,885)$(197,338)
                                     ======== =========   ======== =========
Basic and Diluted Net
     (Loss) Per Share              $   (0.04) $   (1.43)  $  (0.28)$   (1.56)
                                     =======  =========   ======== ==========

Weighted  Average Shares
     Outstanding                     126,616    126,641    126,633   126,641
                                     =======  =========   ======== ==========


See accompanying Notes.


<PAGE>

[CAPTION]

                        EEX CORPORATION
  CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)


                                                        Nine Months Ended
                                                          September 30
                                                       -------------------
                                                         1998       1997
                                                       --------   --------
                                                         (In thousands)
[S]                                                 [C]          [C]
OPERATING ACTIVITIES
 Net (loss)                                         $ (34,885)   $(197,338)
 Impairment of producing oil and gas properties                    210,202
 Impairment of undeveloped leasehold                                40,866
 Dry hole cost                                         17,445        7,409
 Depreciation and amortization                         77,415      112,353
 Deferred income tax (benefit)                         (8,678)     (69,534)
 Loss (gain) on sales of property,
     plant and equipment                                1,266       (8,003)
 Other                                                  4,279       14,071
 Changes in current operating assets and liabilities
  Accounts receivable                                  17,299       17,068
  Other current assets                                 (3,685)      (2,477)
  Accounts payable                                    (70,319)      17,915
  Other current liabilities                            (4,691)         355
                                                    ---------    ---------
  Net cash flows from (used in)
     operating activities                              (4,554)     142,887
                                                    ---------    ---------

INVESTING ACTIVITIES
   Additions to property, plant and equipment        (118,133)    (128,522)
 Proceeds from disposition of property,
     plant and equipment                              236,148       61,240
 Changes in property, plant and
     equipment accruals                                 9,485       (3,386)
                                                    ---------    ---------
  Net cash flows from (used in)
     investing activities                             127,500      (70,668)
                                                    ---------    ---------

FINANCING ACTIVITIES
 Borrowings under bank revolving credit agreement     160,000       60,000
 Repayment of borrowings under bank
     revolving  credit   agreement                   (155,000)    (140,000)
 Borrowings under short term financing agreement      167,764      130,900
 Repayments under short term financing agreement     (172,764)    (127,900)
 Redemption of minority interest in preferred
  securities of subsidiary                           (100,000)
 Repayment of Company-Obligated mandatorily
     redeemable preferred securities of subsidiary                (150,000)
 Issuance of minority interests in preferred
     securities of subsidiaries                                    150,000
 Change in temporary advances with 
    affiliated companies                                            13,328
 Change in advances under leasing arrangements                      (5,457)
 Payments of capital lease obligations                 (8,040)      (2,899)
 Issuance of common stock                                                2
                                                    ---------    ---------
    Net cash flows used in financing activities      (108,040)     (72,026)
                                                    ---------    ---------
Net Increase in Cash and Cash Equivalents              14,906          193
Cash and Cash Equivalents at Beginning of Period        3,790        1,358
                                                    ---------    ---------
Cash and Cash Equivalents at End of Period          $  18,696   $    1,551
                                                    =========    =========


See accompanying Notes.


<PAGE>

[CAPTION]

                        EEX CORPORATION
             CONDENSED CONSOLIDATED BALANCE SHEETS
                (September 30, 1998 Unaudited)

                                                 September 30    December 31
                                                     1998            1997
                                                 ------------     ---------
                                                       (In thousands)
[S]                                             [C]             [C]
ASSETS
Current Assets
 Cash and cash equivalents                      $   18,696      $    3,790
 Accounts receivable - trade                        40,626          57,925
 Other                                              15,230          11,545
                                                ----------      ----------
    Total current assets                            74,552          73,260
                                                ----------      ----------
Property, Plant and Equipment (at cost)
 Oil and gas properties
    (successful efforts method)                  1,247,225       1,882,097
 Other                                              19,875          19,581
                                                ----------      ----------
    Total                                        1,267,100       1,901,678
 Less accumulated depreciation
     and amortization                              772,254       1,192,691
                                                ----------      ----------
    Net property, plant and equipment              494,846         708,987
                                                ----------      ----------
Deferred Income Tax Benefit                         28,916          20,238
                                                ----------      ----------

Other Assets                                         4,631           5,304
                                                ----------      ----------
    Total                                       $  602,945      $  807,789
                                                ==========      ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
 Accounts payable - trade                       $   47,782      $  108,616
 Short term borrowings                                               5,000
 Current portion of capital lease obligations       10,813           8,418
 Other                                               5,340          10,031
                                                ----------      ----------
    Total current liabilities                       63,935         132,065
                                                ----------      ----------
Bank Revolving Credit Agreement                     30,000          25,000
                                                ----------      ----------
Capital Lease Obligations                          222,882         233,317
                                                ----------      ----------
Other Liabilities                                   45,851          42,744
                                                ----------      ----------
Minority Interest in Preferred
     Securities of Subsidiary                                      100,000
                                                ----------      ----------
Common Shareholders' Equity
 Common stock (400,000 shares authorized;
  127,150 and 127,059 shares outstanding)            1,272           1,271
 Paid in capital                                   569,289         570,493
 Accumulated deficit                              (328,657)       (293,772)
 Unamortized restricted stock compensation          (1,236)         (2,877)
 Treasury stock                                       (391)           (452)
                                                ----------      ----------
    Common shareholders' equity                    240,277         274,663
                                                ----------      ----------
    Total                                       $  602,945      $  807,789
                                                ==========      ==========

See accompanying Notes.


<PAGE>                               
                        EEX CORPORATION
     Notes to Condensed Consolidated Financial Statements

1.    In the opinion of management, all adjustments (consisting
  only  of  normal  recurring accruals) necessary  for  a  fair
  presentation of the financial position, results of operations
  and  cash flows for the interim periods included herein  have
  been   made.   Certain  items  in  prior  periods  have  been
  reclassified to be consistent with the current presentation.

2.   Basic net income (loss) per share is based on the weighted
  average number of common shares outstanding during the period.
  Diluted net income (loss) per common share, where applicable,
  is  based on the weighted average number of common shares and
  all  dilutive potential common shares outstanding during  the
  period.

3.    In the second quarter of 1998, EEX redeemed at par value,
  all of the outstanding preferred securities of a subsidiary.

4.    The Company maintains a valuation allowance to reduce the
  calculated  deferred  tax asset to net  realizable  value  in
  accordance with Statement of Financial Accounting Standards No.
  109 (SFAS 109). In the third quarter of 1998, EEX increased the
  deferred tax asset by $8.7 million based upon several factors,
  one of which is the taxable income from producing properties in
  Indonesia which will be sheltered by past foreign net operating
  losses. The realization of the remaining deferred tax asset is
  based on expected future earnings and tax planning strategies
  which include planned sales of non-core assets with fair market
  values  in excess of book and tax cost bases, utilization  of
  excess capacity of the Cooper floating production facility and
  pipeline, acceleration of income from shallow water  Gulf  of
  Mexico producing properties received as part of a property swap
  completed  during  the third quarter of 1998,  the  favorable
  impact  from restructuring measures over the last  year,  the
  curtailment of the onshore exploration program and reduction of
  dry hole exposure in the Company's Gulf of Mexico exploration
  program. Although the Company has incurred net taxable losses
  for book purposes in recent years, management believes it  is
  more  likely than not that the Company will generate  taxable
  income  sufficient to realize a portion of the  tax  benefits
  associated with assets which have a tax basis in excess of net
  cost recorded under the successful efforts method of accounting
  used  for  financial  reporting  purposes.  Such  assets  are
  primarily  represented by seismic costs capitalized  for  tax
  purposes  but  expensed under successful efforts  accounting,
  assets impaired under the provisions of SFAS 121 for which no
  tax  deduction  is immediately available and  past  operating
  losses  of  controlled foreign corporations. While management
  believes that future earnings will be significantly enhanced as
  a  result  of  its strategic plan, due to the uncertainty  of
  future  income estimates the additional anticipated  earnings
  benefit from further realization of the additional tax  basis
  has not been fully recognized at this time and is included in
  the valuation allowance of  $65 million at September 30, 1998
  for the Company's deferred tax asset.

<PAGE>

5.   The In June 1998, the Financial Accounting Standards Board
  issued SFAS No. 133, "Accounting for Derivative Instruments and
  Hedging  Activities",  which is effective  for  fiscal  years
  beginning   after  June  15,  1999,  with  earlier   adoption
  encouraged.  This  Statement  requires  companies  to  record
  derivatives  on the balance sheet as assets and  liabilities,
  measured at fair value. Gains or losses resulting from changes
  in  the  values  of those derivatives would be accounted  for
  depending on the use of the derivative and whether it qualifies
  for  hedge  accounting. EEX has not yet determined  what  the
  effect  of SFAS No. 133 will be on results of operations  and
  financial position. EEX will adopt this accounting standard as
  required by January 1, 2000.

6.    Early  in  1998,  EEX entered into two  forward  purchase
  facilities to repurchase shares of its common stock. During the
  third quarter of 1998, EEX initiated several transactions under
  these  facilities. These facilities allow for settlement,  at
  EEX's  option, by physical delivery of the shares to  EEX  in
  exchange for cash or on a net basis in either shares  of  EEX
  common  stock or in cash. For a net basis settlement, to  the
  extent  that  the  market price of EEX's common  stock  on  a
  settlement  date is higher (lower) than the forward  purchase
  price, the net differential is received (paid) by EEX. As  of
  September 30, 1998, transactions under these facilities covered
  approximately $5.5 million or 986,900 shares of  EEX's  stock
  with an average  forward purchase price of $5.57 per share. If
  the agreements were settled on a net basis on the September 30,
  1998 market price of EEX's common stock ($4.88 per share), EEX
  would be obligated to pay approximately $.7 million in cash or
  deliver approximately 141,648 shares.

7.    EEX was named a defendant in two lawsuits filed on August
  3,  1998,  in  Federal  Court for the Northern  and  Southern
  Districts  of Texas.  The suits are on behalf of certain  EEX
  shareholders  and  have  been consolidated  in  the  Northern
  District of Texas (Dallas)and a consolidated amended complaint
  will  be  filed.   The  plaintiffs allege  misrepresentations
  occurred prior to August 4, 1997, concerning the value of the
  Company's assets and reserves.  In addition to EEX, defendants
  include Enserch Corporation, Texas Utilities Company, Degolyer
  &  MacNaughton  and certain present and former  officers  and
  directors of EEX.  No assessment of the claims can be made at
  this time.  EEX intends to vigorously defend the consolidated
  action.

<PAGE>

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

Certain statements in this report, including statements of EEX
Corporation's ("EEX" or the "Company") and management's
expectations, intentions, plans and beliefs, are "forward-
looking statements," within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended, that are subject
to certain events, risks and uncertainties that may be outside
EEX's control.  See "Forward Looking Statements- Uncertainties
and Risks" below.

RESULTS OF OPERATIONS

EEX  reported  a third quarter 1998 net loss of  $5.5  million
($.04 per share), versus a net loss of $182 million ($1.43 per
share)  for  the same period in 1997. Results  for  the  three
months  ended September 30, 1998 included non-recurring  gains
on asset sales ($3 million). Results for the nine months ended
September  30, 1998 included non-recurring amounts for  losses
on  asset  sales ($1.3 million) and costs associated with  the
disposition   of   properties  in  East  Texas   included   in
depreciation and amortization ($6.7 million). Results for  the
quarter and nine months ended September 30, 1997 included non-
recurring  amounts  for  gains on asset  sales  ($8  million);
impairment of producing oil and gas properties ($210 million);
and an unusual charge, included in general, administrative and
other  expenses,  for  reorganization and  restructuring  ($24
million for the quarter and $26 million for nine months).

In  the  following comparisons of results of operations,  1998
and  1997  results  have been adjusted  to  exclude  the  non-
recurring items described above.

QUARTERS ENDED SEPTEMBER 30, 1998 AND 1997 - Revenues for  the
third  quarter  of 1998 were $46 million, a 41% decrease  from
1997  primarily  due  to decreased production  resulting  from
sales  of  non-core properties and third quarter 1998 weather-
related  production shutdowns in the Gulf of  Mexico.  Natural
gas  revenues decreased $28 million (55%) resulting from lower
third  quarter 1998 production ($25 million), and prices ($2.9
million).  The  average natural gas sales price  per  thousand
cubic  feet ("Mcf") was $2.06 in 1998 compared with  $2.32  in
1997.   Natural gas production for 1998 was 11.1 billion cubic
feet ("Bcf"), down from 22 Bcf in 1997. Oil revenues decreased
$3.4  million (15%), reflecting a 30% decrease in the  average
sales price per barrel to $12.58, which was mostly offset by a
20% increase in production primarily due to the Mudi field  in
Indonesia.  Crude  oil production was 1,470  thousand  barrels
("Mbbls")  in  1998 compared to 1,223 MBbls in 1997.  EEX  net
production from the Mudi field for the third quarter  of  1998
was  666  Mbbls, down slightly from 722 Mbbls  in  the  second
quarter  of  1998  due to market constraints  and  operational
factors.

Costs  and expenses from recurring operations were $56 million
in  1998,  compared to $91 million in 1997,  a  38%  decrease.
Operating  expenses  (production and  operating,  general  and
administrative and taxes other than income) were  $20  million
in  1998, 17% lower than 1997, resulting from asset sales  and
the  favorable impact from restructuring measures  implemented
over  the  last year. Production and operating costs for  1998
included $3.3 million for oil production from the Mudi  field.

<PAGE>

Exploration expenses for 1998 decreased 55% from 1997  due  to
curtailment  of  the  onshore exploration program,  change  in
focus  to offshore and international areas and impact  of  the
offshore  exploration joint venture with Enterprise  Oil  Plc.
Exploration  expense for the third quarter  of  1998  includes
$7.1  million for dry holes in both offshore and international
drilling  activities.  Depreciation and amortization  was  $22
million  in  1998, $17 million lower than 1997  due  to  lower
production volumes and the impairment to producing oil and gas
properties recognized in 1997.

Total  interest and other financing costs, including  minority
interest,  were $4.1 million in 1998, a $4.7 million reduction
from 1997, due to the reduction in debt and redemption of  the
minority interest with proceeds of asset sales.

NINE  MONTHS ENDED JUNE 30, 1998 AND 1997 - Revenues for  1998
were  $169  million, a 29% decrease from  1997  due  to  lower
production resulting from sales of non-core properties  and  a
13%  reduction in the sales price per barrel of oil equivalent
to  $13.63. Natural gas revenues decreased $54 million  (35%),
resulting  primarily  from  lower  production  ($48  million).
The  average natural gas sales price per Mcf was $2.28 in 1998
compared with $2.41 in 1997.  Natural gas production for  1998
was  44.3  Bcf,  down  from 64.2 Bcf  in  1997.  Oil  revenues
decreased $15 million (21%), reflecting a 30% decrease in  the
average  sales price per barrel to $13.68, which was partially
offset by a 13% increase in production primarily from the Mudi
field.  Crude oil production for 1998 was 4,119 Mbbls compared
to  3,652  Mbbls in 1997. Production from the Mudi  field  was
1,476 Mbbls.

Costs and expenses from recurring operations were $180 million
in  1998, compared to $258 million in 1997. Operating expenses
(as  defined above) were $64 million in 1998, 12%  lower  than
1997  for  the reasons listed above. Production and  operating
costs for 1998 included $7 millon for oil production from  the
Mudi  field. Exploration expenses for 1998 decreased 42%  from
1997  due to reasons described above. Exploration expense  for
1998  includes  $17  million for dry holes.  Depreciation  and
amortization was $71 million in 1998, $42 million  lower  than
1997  due  to  lower production volumes and the impairment  to
producing oil and gas properties recognized in 1997.

In  the second quarter of 1998, EEX completed the sale of  East
Texas  producing  oil and gas properties to Cross  Timbers  Oil
Company   for   $235  million.   These  properties  represented
approximately 220 billion cubic feet of gas equivalent.   As  a
part  of the sale, EEX retained a volumetric production payment
to satisfy an obligation existing under agreements with Encogen
One  Partners, Ltd.  The effective date of the sale was January
1, 1998.

Results  of operations for the nine months ended September  30,
1998  include  the following revenues, costs and  expenses  and
sales volumes attributable to the East Texas properties:

     Revenues                       Millions  Sales Volume
        Natural gas                   $17.3      8.2 Bcf
        Oil, condensate and liquids     1.5      103 MBbls

     Costs and Expenses
        Production                      1.6
        Depreciation and amortization  15.2
        Taxes, other than income        1.6

<PAGE>

Total  interest and other financing costs, including  minority
interest,  were $21 million, $4.9 million reduced  from  1997,
resulting  from  a  lower  overall  debt  level  in  1998  and
redemption  of the minority interest in the second quarter  of
1998.

HEDGING ACTIVITIES

A  portion  of  the risk associated with fluctuations  in  the
price  of  natural gas and oil is managed through the  use  of
hedging  techniques  such as oil and gas  swaps,  collars  and
futures agreements.  EEX fixed the price on third quarter 1998
production  volumes  of  7.3  Bcf  of  natural  gas  (64%   of
production) at an average price of $2.19 per Mcf and 262 MBbls
of  oil (40% of production) at an average price of $18.53  per
Bbl.   For the first nine months of 1998, EEX fixed the  price
on  25  Bcf  of natural gas (56% of production) at an  average
price  of  $2.36  per  Mcf and 1,269  MBbls  of  oil  (63%  of
production) at an average price of $17.81 per Bbl.   In  total
oil  and  gas price hedging activities increased third quarter
1998  revenues by $1.2 million, compared to a decrease of  $.8
million  for  the third quarter of 1997. For  the  first  nine
months  of  1998  and  1997, oil and  gas  hedging  activities
increased   revenues   by   $7  million   and   $.8   million,
respectively.  At  September 30,  1998,  EEX  had  outstanding
swaps,  collars and futures agreements that were entered  into
as  hedges  extending through December 31, 1999,  to  exchange
payments on 13.2 Bcf of natural gas and 230 MBbls of oil.   At
September  30, 1998, there were $.8 million of net  unrealized
and unrecognized hedging gains based on the difference between
the  strike price and the New York Mercantile Exchange futures
price  for  the applicable trading month.  In addition,  there
were  $.1  million  of realized losses on  hedging  activities
which  were  deferred and will be applied  as  a  decrease  in
revenues in the fourth quarter of 1998 in the applicable month
of physical sale of production.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows and Capital Expenditures

For  the  first nine months of 1998, EEX generated  sufficient
cash  flows from asset sales to fund its capital requirements,
reduce  financings  by  $8 million, redeem  all  of  the  $100
million  of  preferred securities of a subsidiary and  provide
funds  required by operations.  Operating activities  for  the
first nine months of 1998 required cash flows of $4.6 million,
compared   to  $143  million  of  cash  flows  provided   from
operations  in 1997. The requirement in 1998 was a  result  of
changes in current operating assets and liabilities.

The  Company  intends to continue to make substantial  capital
expenditures in the fourth quarter of 1998 and in 1999 for the
exploration  and development of its properties,  primarily  in
the  Gulf  of  Mexico. At present, EEX plans to finance  these
capital expenditures through internally generated cash  flows,
the  sale  of  additional  non-core assets,  borrowings  under
existing  credit  facilities, alliances  with  contractors  to

<PAGE>

assume early capital expenditure requirements and/or offerings
in public or private equity or debt markets.  Borrowings under
EEX's  credit  facilities  may  also  be  used  to  supplement
temporary  cash flow needs.  In September 1998,  EEX  filed  a
Form  S-3  registration statement to register an aggregate  of
$300 million of debt securities, preferred stock, warrants and
common  stock. The registration statement became effective  on
October  13,  1998.   EEX  plans  to  offer  debt  or   equity
securities   registered  under  the  Form  S-3   when   market
conditions are favorable. EEX does not anticipate paying  cash
dividends on its common stock in the foreseeable future.

Capital Structure

EEX  has  scheduled  a  special meeting  of  shareholders  for
December  8, 1998 to vote on a one-for-three reverse split  of
the  Company's outstanding common stock, presently 127 million
shares,  and  to reduce the Company's authorized common  stock
from  400  million shares to 150 million shares.  The  reverse
split,  if approved by shareholders, will not have a  material
effect  on financial position, results of operations  or  cash
flows.

In the second quarter of 1998, EEX redeemed, at par value, all
the  outstanding  preferred securities of  a  subsidiary.  The
dividend rate on these preferred securities was based on LIBOR
plus  a spread of 4% for the quarter ended March 31, 1998,  5%
for the quarter ended June 30, 1998 and was to increase by  1%
quarterly  through December 31, 1998. At September  30,  1998,
debt  represented 53% of total capitalization, as  defined  in
loan  agreements  and  includes  both  capital  and  operating
leases, compared to 50% at December 31, 1997.

YEAR 2000 ISSUE

EEX initiated its Year 2000 Readiness Program in 1998 by
engaging a consultant to perform a preliminary analysis of the
Company's asset inventory and provide strategic guidelines to
ensure EEX's operations are not interrupted by the potential
failure of computer programs to recognize and interpret date
codes correctly in the Year 2000 ("Year 2000 Issue").  A
project team comprised of managers from various departments
reviewed the consultant's conclusions and developed an
organizational approach for the investigation of the Year 2000
Issue.

This approach entails assessment, implementation, certification
and contingency planning phases.  Generally, EEX's strategy
involves the identification of operations and inventory that
may be affected by the Year 2000 Issue, the assessment of
readiness and the risk associated with those items that may
fail to perform, and the implementation of corrective measures
and contingency plans.  To date, EEX has identified software,
hardware and other memory-capable pieces of equipment that may
be affected by the Year 2000 Issue, and is researching
manufacturer/vendor representations regarding their Year 2000
functionality.  Concurrently, EEX is conducting a poll of its
business partners and service providers regarding their Year
2000 readiness. After the results of this poll are known,
contingency plans, which will include actions such as
identifying alternates for those entities that cannot provide
satisfactory levels of assurance, will be formulated. It is
anticipated these contingency plans will be in place by the
third quarter of 1999.

<PAGE>

In general, the equipment situated on EEX-operated offshore
production facilities may be less likely to present Year 2000-
related obstacles since the average age of those facilities is
three years.  Responsibility for Year 2000 readiness with
respect to drilling operations is addressed and delineated
during drilling contract negotiations. The majority of EEX's
hardware and software is covered by maintenance agreements that
ensure the issuance of Year 2000-compliant updates or the
provision of necessary modifications at no additional cost to
EEX.

EEX is currently focused on implementing corrective measures
for those inventory items that have been identified as non-
compliant.  For example, system upgrades and compliance testing
for EEX's financial application system are expected to be
complete in the first quarter of 1999.  Additionally, certain
production facility components will be replaced with Year 2000-
functional substitutes prior to the third quarter of 1999.  To
date, EEX has spent $.1 million on Year 2000 corrective
measures.  Year 2000 costs to EEX cannot be accurately
estimated at this time because EEX has not completed its
assessment of inventory and operations.  No assurances can be
given that business interruptions arising from the Year 2000
Issue will not occur.



RECENT EVENTS

Trade for Shallow Water Properties in the Gulf of Mexico

In  the  third  quarter  of 1998 EEX completed  the  previously
announced  exchange of substantially all of its  Permian  Basin
properties  in  West Texas and Eastern New Mexico  for  shallow
water  properties located off the coast of Texas and Louisiana.
In the trade, which was effective January 1, 1998, EEX received
interests in 24 producing blocks and 30 exploratory blocks  and
$9 million in cash.

Llano Development Plan

EEX  is  planning a phased development approach to exploit  the
potentially sizeable reserves encountered at Llano.  Presently,
there  are  no  proved reserves at Llano. The  phased  approach
begins  with an appraisal well to be drilled during the  fourth
quarter and an early development option that could bring  first
production  on  line  as early as late 2000.   In  addition  to
development drilling at Llano, additional exploration  drilling
is planned on other prospects in the area over the next several
years.  Information provided from early production at Llano and
any  additional  exploration success will be used  to  properly
size the eventual production facilities.

Early  in  the fourth quarter of 1998, the Ocean Voyager  semi-
submersible drilling rig returned to Garden Banks Block 386 and
will begin drilling the first Llano appraisal well. Drilling at
the  Llano #2 well on Block 386 is expected to continue through
the  first  quarter of 1999. The Llano #2 is the  first  of  at
least  two  wells  which  will  be  required  to  evaluate  the
potential size of the reservoir.

<PAGE>
                               
Early  production  options  may  include  utilization  of   the
existing facility currently located on Garden Banks Block  388.
The  Cooper field on Block 388 is producing through a  Floating
Production System ("FPS") and sub-sea pipelines that flow to  a
shallow water facility on Eugene Island Block 315.  With Cooper
field   production  rapidly  declining,  EEX   is   considering
relocating  the FPS from Cooper to the Llano area in  order  to
accelerate  first production by connecting the appraisal  wells
to the existing infrastructure.

Deepwater Exploration Program

In  addition to development activities at Llano, EEX  continues
to pursue an exploration drilling program and to participate in
offshore  lease sales in the deepwater of the Gulf  of  Mexico.
In  the most recent offshore lease sale (Western Gulf of Mexico
Sale # 171), EEX, along with partners, were the high bidders on
four  out of five blocks bid upon. Assuming all these bids  are
awarded,  EEX  will  have  an interest  in  97  blocks  in  the
deepwater Gulf of Mexico.

Drilling operations at the Sheba Prospect on Green Canyon Block
341 in the deepwater of the Gulf of Mexico have been completed.
While  encountering  several  sand  intervals  in  drilling  to
approximately   25,000   feet,   there   were   no   commercial
accumulations of hydrocarbons.  The well has been  plugged  and
the  semi-submersible drilling rig will be used  to  drill  the
first appraisal well at the Company's Llano discovery.

EEX  currently  has deepwater wells drilling on two  prospects:
Elvis  and  Gamera.  The Elvis prospect on  Mississippi  Canyon
block  580  is drilling below 17,000 feet, above the  objective
horizons, which are as deep as 20,000 feet.  The Elvis well  is
expected to reach total depth in November.

The  recently spud Gamera prospect is located in the ultra-deep
waters of Atwater Valley in the Gulf.  The initial objective of
this  well is the Lower Pliocene sand around 16,000 feet.   The
well  is  anticipated  to reach total depth  during  the  first
quarter of 1999.

Gulf of Mexico Shelf Activities

The  shelf  drilling program thus far in 1998 has  resulted  in
five  successes and three dry holes.  EEX is currently drilling
two  additional  shelf  wells which are  expected  to  complete
before  the  end  of  the  year.  A recently  drilled  well  at
Vermilion   37   was  temporarily  abandoned  pending   further
evaluation.  The successful wells will contribute to additional
gas  production at an estimated rate, net to EEX,  of  some  35
million  cubic feet per day.  The largest contributors to  this
rate  will come from South Timbalier Block 217 and West Cameron
Block  204, which are expected to begin producing in the fourth
quarter.  EEX  plans  to  use available surplus  facilities  to
accelerate  the  time from discovery to first  production.   An
existing  platform  on  Brazos  Block  455  was  salvaged   and
reinstalled  in approximately 50 feet of water at West  Cameron
204 and production commenced in early November.

<PAGE>

International Activities

EEX  has a 50% interest in production at the Mudi Field in  the
Tuban   Block  of  Indonesia  and  is  continuing  to  evaluate
additional prospects located within the block.  In Turkey,  the
Company   pursued  two  areas  of  interest   and,   after   an
unsuccessful  exploratory well at the Salt Lake  prospect,  has
relinquished its exploration contracts in Turkey.

NEW ACCOUNTING STANDARD

In  June 1998, the Financial Accounting Standards Board issued
SFAS No. 133,"Accounting    for   Derivative   Instruments  and
Hedging Activities",  which  is effective for fiscal  years 
beginning after  June  15, 1999, with earlier adoption encouraged. 
This Statement  requires  companies to record  derivatives  on  the
balance  sheet  as  assets and liabilities, measured  at  fair
value. Gains or losses resulting from changes in the values of
those derivatives would be accounted for depending on the  use
of   the  derivative  and  whether  it  qualifies  for   hedge
accounting. EEX has not yet determined what the effect of SFAS
No.  133  will  be  on  results of  operations  and  financial
position. EEX will adopt this accounting standard as  required
by January 1, 2000.


Forward Looking Statements -Uncertainties and Risks

Certain  statements  in  this report, including  statements  of
EEX's  and  management's expectations,  intentions,  plans  and
beliefs,  are "forward-looking statements," within the  meaning
of  Section  21E  of the Securities Exchange Act  of  1934,  as
amended,  that  are  subject  to  certain  events,  risks   and
uncertainties that may be outside EEX's control.  These forward-
looking statements include statements of management's plans and
objectives for EEX's future operations and statements of future
economic performance; information regarding drilling schedules,
expected  or  planned production, future production  levels  of
international  and  domestic fields, EEX's capital  budget  and
future  capital requirements, EEX's meeting its future  capital
needs, the level of future expenditures for environmental costs
and  the outcome of regulatory and litigation matters; and  the
assumptions  described in this report underlying such  forward-
looking  statements.  Actual  results  and  developments  could
differ  materially from those expressed in or implied  by  such
statements  due  to  a  number of factors,  including,  without
limitation,  those described in the context  of  such  forward-
looking  statements and the risk factors set  forth  below  and
described  from  time  to  time in EEX's  other  documents  and
reports filed with the Securities and Exchange Commission.

   Exploration  Risk.   Exploration for  oil  and  gas  in  the
deepwater  Gulf  of Mexico and unexplored frontier  areas  have
inherent  and  historically high risk.  As  described  in  this
report,  EEX  is  focusing  on  exploration  opportunities   in
offshore and international areas which will increase associated
risk.    Future  reserve  increases  and  production  will   be
dependent on EEX's success in these exploration efforts and  no
assurances can be given of such success.

      Operational  Risks  and Hazards.   EEX's  operations  are
subject to the risks and uncertainties associated with finding,
acquiring and developing oil and gas properties, and producing,
transporting  and  selling  oil  and  gas.  Operations  may  be
materially  curtailed,  delayed or  canceled  as  a  result  of
numerous   factors,  such  as  accidents,  weather  conditions,
compliance  with  governmental requirements  and  shortages  or

<PAGE>

delays  in  the  delivery of equipment.  Drilling  may  involve
unprofitable efforts, not only with respect to dry  wells,  but
also  with  respect  to wells that are productive  but  do  not
produce  sufficient  net  revenues to  return  a  profit  after
drilling,  operating and other costs.  Various field  operating
hazards   such  as  fires,  explosions,  blow-outs,   equipment
failures,  abnormally  pressured formations  and  environmental
accidents  may  adversely  affect  production  from  successful
wells.   EEX's  ability to sell its oil and gas  production  is
dependent   on  the  availability  and  capacity  of  gathering
systems, pipelines and other forms of transportation.

   Offshore Risks.  EEX's offshore Gulf of Mexico oil  and  gas
reserves include properties located in water depths of 20 to in
excess of 7,000 feet where operations are by their nature  more
difficult  than  drilling  operations  conducted  on  land   in
established producing areas.  Deepwater drilling and operations
require  the  application  of more advanced  technologies  that
involve  a higher risk of mechanical failure and can result  in
significantly    higher   drilling   and    operating    costs.
Furthermore,  offshore operations require a significant  amount
of  time between the time of discovery and the time the gas  or
oil  is  actually marketed, increasing the market risk involved
with such operations.

   Volatility  of  Oil and Gas Markets.  EEX's  operations  are
highly  dependent upon the prices of, and demand for,  oil  and
gas.  These prices have been, and are likely to continue to be,
volatile.  Prices are subject to fluctuations in response to  a
variety of factors that are beyond the control of EEX, such  as
worldwide  economic  and political conditions  as  they  affect
actions  of OPEC and Middle East and other producing countries,
and  the  price and availability of alternative  fuels.   EEX's
hedging  activities with respect to some of its  projected  oil
and gas production, which are designed to protect against price
declines, may prevent EEX from realizing the benefits of  price
increases  above the levels of the hedges and protect  it  from
incurring the detriments of price decreases below the level  of
hedges.   Because the majority of EEX's reserve base is natural
gas  on  an  energy equivalent basis, it is more  sensitive  to
fluctuations in the price of natural gas.

  Estimating Reserves and Future Net Cash Flows.  Uncertainties
are  inherent in estimating quantities and values  of  reserves
and  in  projecting rates of production, net revenues  and  the
timing of development expenditures.  The reserve data represent
estimates only of the recovery of hydrocarbons from underground
accumulations  and  are  often different  from  the  quantities
ultimately  recovered.   Any  downward  adjustment  in  reserve
estimates  could  adversely affect EEX.  Also, any  substantial
decline  due  to long-term price changes in the  projected  net
revenues  resulting from production of reserves  could  have  a
material adverse effect on the Company's financial position and
results of operation.

  Capital Funding.  EEX's access to public or private equity or
debt  markets  may  be  limited by  general  conditions  in  or
volatility of the markets. No assurances can be given that  the
Company will be able to secure funds in these markets, or  that
such funds will be obtained on terms favorable to the Company.


<PAGE>

   Government Regulation.  EEX's business is subject to certain
federal, state and local laws and regulations relating  to  the
drilling  for  the  production of  oil  and  gas,  as  well  as
environmental  and  safety matters.  See "Business  -Government
Regulation "in EEX's Annual Report on Form 10-K.

   International  Operations.  EEX's  interests  in  countries
outside  the  United States are subject to the  various  risks
inherent  in  foreign operations.  These  risks  may  include,
among  other  things, currency restrictions and exchange  rate
fluctuations,  loss of revenue, property and  equipment  as  a
result  of  expropriation, nationalization, war,  insurrection
and  other  political risks, risks of increases in  taxes  and
governmental  royalties,  renegotiations  of  contracts   with
governmental entities, changes in laws and policies  governing
operations  of foreign-based companies and other uncertainties
arising  out  of  foreign  government  sovereignty  over   the
Company's    international    operations.     The    Company's
international  operations may also be  adversely  affected  by
laws  and  policies  of  the United States  affecting  foreign
trade, taxation and investment.  In addition, in the event  of
a  dispute arising from foreign operations, the Company may be
subject to the exclusive jurisdiction of foreign courts or may
not  be  successful  in  subjecting  foreign  persons  to  the
jurisdiction of the courts of the United States.


<PAGE>

[CAPTION]

                        EEX CORPORATION
SUMMARY OF SELECTED OPERATING DATA FOR OIL & GAS PRODUCING ACTIVITIES
                          (UNAUDITED)

                                       Three Months Ended   Nine Months Ended
                                          September 30         September 30
                                      -------------------   ----------------

                                           1998    1997      1998   1997
                                          ------  ------    ------ ------
[S]                                       [C]    [C]       [C]     [C]
Sales Volumes
 Natural gas (MMcf)                       11,112 22,022    44,256  64,173
 Oil and condensate (MBbls)                1,470  1,223     4,119   3,652
 Natural gas liquids (MBbls)                  39    179       141     365
   Total volumes (MBoe) (a)                3,361  5,072    11,636  14,713

Average Sales Price
 Natural gas (per Mcf)                    $ 2.06 $ 2.32    $ 2.28 $  2.41
 Oil and condensate (per Bbl)              12.58  17.88     13.68   19.50
 Natural gas liquids (per Bbl)             10.82  12.16     10.40   13.61
   Total product revenue (per MBoe) (a)    12.44  14.83     13.63   15.70

Cost and Expenses (per MBoe) (a) (b)
  Production  and operating (c)           $ 3.55$  2.42   $  3.05 $  2.54
 Exploration                                3.38   4.97      3.23    4.43
 Depreciation and amortization              6.48   7.61      6.65    7.64
 General, administration and other          1.86   1.52      1.64    1.51
 Taxes, other than income                    .67    .92       .83     .93

Net Wells
 Drilled                                     6.7     16      20.7      45
 Productive                                  5.7      9      16.7      33


(a) Natural  gas  has  been converted to barrel of  oil  equivalents
    (Boe) on the basis of six Mcf equals 1.0 Boe.
(b) Excludes unusual and non-recurring expenses.
(c) Excludes related production, severance and ad valorem taxes.



<PAGE>


                  PART II - OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K

       (a)       Exhibits

           EXHIBIT (27) - Financial Data Schedule

       (b)       Reports on Form 8-K

           Current  Report  on  Form 8-K  dated  September  24,
           1998.  (News release dated September 24, 1998:   EEX
           shareholders to vote on one-for-three reverse  split
           of EEX common stock.)
           
           Current  Report  on  Form 8-K  dated  September  10,
           1998.   (News  release  dated  September  10,  1998:
           Update  on  Llano  development plans  and  deepwater
           exploration program.)
           
           Current Report on Form 8-K dated September 1,  1998.
           (News  release dated September 1, 1998:   Successful
           completion  and  testing of West Cameron  Block  204
           Well No. 1.)



<PAGE>



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.

                                      EEX CORPORATION
                                        (Registrant)






Dated November 11, 1998    By         /s/R. S. Langdon
                           -------------------------------------

                                      R. S. Langdon
                                      Executive Vice President,
                                      Finance and Administration,
                                      and Chief Financial Officer
                                      
                                      
                                      
                                      
                                      
                         The above officer of registrant has signed this
                         report as its duly authorized representative and
                         as its principal financial officer.