SECURITIES AND EXCHANGE COMMISSION

                           Washington, D.C. 20549


                                  FORM 10-Q


              Quarterly Report Under Section 13 or 15(d) of the
                       Securities Exchange Act of 1934


For the Quarter Ended March 31, 1998            Commission File No. 0-1857-3


                          THE BERKSHIRE GAS COMPANY


Massachusetts                                                     04-1731220

115 Cheshire Road, Pittsfield, Massachusetts                      01201-1879


Registrant's telephone number, including Area Code              413:442-1511


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  [ ]


At March 31, 1998, the Registrant had issued and outstanding 2,285,745 
shares of Common Stock, par value $2.50.


                          THE BERKSHIRE GAS COMPANY
           STATEMENTS OF INCOME AND RETAINED EARNINGS - Unaudited
------------------------------------------------------------------------------
                   (In Thousands Except Per Share Amounts)


<TABLE>
<CAPTION>
                                                        Three Months Ended
                                                       3/31/98      3/31/97
                                                       --------     --------

<S>                                                    <C>          <C>
Operating Revenues                                     $ 22,969     $ 21,803
Cost of Gas Sold                                         11,732       10,667
                                                       ---------------------

Operating Margin                                         11,237       11,136
                                                       ---------------------

Other Operating Expenses                                  3,477        3,373
Depreciation                                              1,967        1,901
                                                       ---------------------

      Total                                               5,444        5,274
                                                       ---------------------
Utility Operating Income                                  5,793        5,862
Other Income - Net                                          567          972
                                                       ---------------------

Operating and Other Income                                6,360        6,834
Interest Expense                                          1,129        1,118
Other Taxes                                                 812          784
                                                       ---------------------

      Pre-Tax Income                                      4,419        4,932

Income Taxes                                              1,680        1,890
                                                       ---------------------

NET INCOME                                                2,739        3,042
Retained Earnings at Beginning of Period                  7,688        6,823
                                                       ---------------------

      Total                                              10,427        9,865
                                                       ---------------------

Dividends Declared:
  Preferred Stock                                             4            5
  Common Stock                                              651          614
                                                       ---------------------

Total Dividends                                             655          619
                                                       ---------------------

Retained Earnings at End of Period                     $  9,772     $  9,246
                                                       =====================

Earnings Available for Common Stock                    $  2,735     $  3,037
                                                       ---------------------

Average Shares of Common Stock Outstanding              2,285.7      2,192.9
                                                       ---------------------

Basic and Diluted Earnings Per Share of 
 Common Stock                                          $   1.20     $   1.38
                                                       =====================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



                          THE BERKSHIRE GAS COMPANY
            STATEMENTS OF INCOME AND RETAINED EARNINGS - Unaudited
------------------------------------------------------------------------------
                  (In Thousands Except Per Share Amounts)

<TABLE>
<CAPTION>
                                                         Nine Months Ended
                                                       3/31/98      3/31/97
                                                       --------     --------

<S>                                                    <C>          <C>
Operating Revenues                                     $ 41,626     $ 38,029
Cost of Gas Sold                                         20,758       17,949
                                                       ---------------------

Operating Margin                                         20,868       20,080
                                                       ---------------------

Other Operating Expenses                                  9,498        9,008
Depreciation                                              3,399        3,240
                                                       ---------------------

      Total                                              12,897       12,248
                                                       ---------------------
Utility Operating Income                                  7,971        7,832
Other Income - Net                                        1,666        2,135
                                                       ---------------------

Operating and Other Income                                9,637        9,967
Interest Expense                                          3,387        2,942
Other Taxes                                               1,481        1,410
                                                       ---------------------

      Pre-Tax Income                                      4,769        5,615
Income Taxes                                              1,790        2,157
                                                       ---------------------

NET INCOME                                                2,979        3,458
Retained Earnings at Beginning of Period                  8,739        7,883
                                                       ---------------------

      Total                                              11,718       11,341
                                                       ---------------------

Dividends Declared:
  Preferred Stock                                            12          266
  Common Stock                                            1,934        1,829
                                                       ---------------------

Total Dividends                                           1,946        2,095
                                                       ---------------------

Retained Earnings at End of Period                     $  9,772     $  9,246
                                                       =====================

Earnings Available for Common Stock                    $  2,967     $  3,192
                                                       ---------------------

Average Shares of Common Stock Outstanding              2,255.1      2,176.2
                                                       ---------------------

Basic and Diluted Earnings Per Share of
 Common Stock                                          $   1.32     $   1.47
                                                       =====================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



                          THE BERKSHIRE GAS COMPANY
           STATEMENTS OF INCOME AND RETAINED EARNINGS - Unaudited
------------------------------------------------------------------------------
                   (In Thousands Except Per Share Amounts)


<TABLE>
<CAPTION>
                                                        Twelve Months Ended
                                                       3/31/98        3/31/97
                                                       ---------------------

<S>                                                    <C>          <C>
Operating Revenues                                     $ 52,059     $ 46,915
Cost of Gas Sold                                         26,019       21,918
                                                       ---------------------

Operating Margin                                         26,040       24,997
                                                       ---------------------

Other Operating Expenses                                 12,551       11,842
Depreciation                                              4,179        3,894
                                                       ---------------------

      Total                                              16,730       15,736
                                                       ---------------------
Utility Operating Income                                  9,310        9,261
Other Income - Net                                        1,887        2,253
                                                       ---------------------

Operating and Other Income                               11,197       11,514
Interest Expense                                          4,425        3,698
Other Taxes                                               1,841        1,765
                                                       ---------------------

      Pre-Tax Income                                      4,931        6,051

Income Taxes                                              1,854        2,331
                                                       ---------------------

NET INCOME                                                3,077        3,720
Retained Earnings at Beginning of Period                  9,246        8,397
                                                       ---------------------

      Total                                              12,323       12,117
                                                       ---------------------

Dividends Declared:
  Preferred Stock                                            12          438
  Common Stock                                            2,539        2,433
                                                       ---------------------

Total Dividends                                           2,551        2,871
                                                       ---------------------

Retained Earnings at End of Period                     $  9,772     $  9,246
                                                       =====================

Earnings Available for Common Stock                    $  3,065     $  3,282
                                                       ---------------------

Average Shares of Common Stock Outstanding              2,239.3      2,167.4
                                                       ---------------------

Basic and Diluted Earnings Per Share of
 Common Stock                                          $   1.37     $   1.51
                                                       =====================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



                          THE BERKSHIRE GAS COMPANY
                               BALANCE SHEETS
------------------------------------------------------------------------------
                               (In Thousands)

<TABLE>
<CAPTION>
                                                               March 31,      June 30,
                                                                 1998           1997
                                                              -----------    ---------
                                                              (Unaudited)    (Audited)

<S>                                                            <C>           <C>
ASSETS: 
Utility Plant:
  Utility Plant - at original cost                             $ 105,856     $ 101,983
  Less: Accumulated Depreciation                                  31,051        28,343
                                                               -----------------------

      Utility Plant - Net                                         74,805        73,640
                                                               -----------------------
Other Property:
  Other Property - at original cost                               12,409        11,983
  Less:  Accumulated Depreciation                                  6,350         5,887
                                                               -----------------------

      Other Property - Net                                         6,059         6,096
                                                               -----------------------

Current Assets:
  Cash                                                               447           356
  Accounts Receivable
    Utility Service (less allowance: Mar. 1998-$1,137;
     June 1997-$900)                                              10,676         6,386
    Merchandise & Other (less allowance: Mar. 1998-$108;
     June 1997-$121)                                               1,086           869
    Other Receivables                                                128           332
    Inventories (at the lower of average cost or market):
      Natural Gas                                                  1,105         1,844
      Liquefied Petroleum                                            101           146
      Materials and Supplies                                       1,581         1,675
      Prepayments and Other                                          590           689
                                                               -----------------------
        Total Current Assets                                      15,714        12,297
                                                               -----------------------

Deferred Debits:
  Unamortized Debt Expense                                         2,226         2,302
  Capital Stock Expense                                              287           319
  Environmental Cleanup Costs                                        955           819
  Other                                                            1,423         1,425
                                                               -----------------------
      Total Deferred Debits                                        4,891         4,865
                                                               -----------------------

   Recoverable Environmental Cleanup Costs                         3,290         3,290
                                                               -----------------------

      TOTAL ASSETS                                             $ 104,759     $ 100,188
                                                               =======================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



                          THE BERKSHIRE GAS COMPANY
                               BALANCE SHEETS
------------------------------------------------------------------------------
                               (In Thousands)

<TABLE>
<CAPTION>
                                                           March 31,     June 30,
                                                             1998          1997
                                                          -----------    --------
                                                          (Unaudited)    (Audited)

<S>                                                        <C>           <C>
CAPITALIZATION AND LIABILITIES
Common Shareholders' Equity:
  Common Stock                                             $   5,715     $   5,529
  Premium on Common Stock                                     18,241        17,097
  Retained Earnings                                            9,772         8,739
                                                           -----------------------

Total Common Shareholders' Equity                             33,728        31,365
                                                           -----------------------
Redeemable Cumulative Preferred Stock                            321           363
                                                           -----------------------

Long-Term Debt                                                40,000        40,000
                                                           -----------------------
Current Liabilities:
  Notes Payable to Banks                                       7,825         6,480
  Accounts Payable                                             2,383         3,513
  Other Current Liabilities                                    2,847         4,621
  Taxes Accrued                                                2,526          (96)
  Refundable(Recoverable) Gas Costs                              452       (1,404)
                                                           -----------------------
      Total Current Liabilities                               16,033        13,114
                                                           -----------------------

  Other Liabilities                                            1,799         1,561
                                                           -----------------------

Unamortized Investment Tax Credit                              1,156         1,209
                                                           -----------------------

Deferred Income Taxes                                          8,432         9,286
                                                           -----------------------

Reserve for Recoverable Environmental Cleanup Costs            3,290         3,290
                                                           -----------------------

TOTAL CAPITALIZATION AND LIABILITIES                       $ 104,759     $ 100,188
                                                           =======================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



                          THE BERKSHIRE GAS COMPANY
                    STATEMENTS OF CASH FLOWS - Unaudited
------------------------------------------------------------------------------
                               (In Thousands)


<TABLE>
<CAPTION>
                                                                    Nine Months Ended
                                                                  3/31/98      3/31/97
                                                                  --------     --------

<S>                                                               <C>          <C>
Cash flows from Operating Activities:
  Net Income                                                      $  2,979     $  3,458

Adjustments to Reconcile Net Income to Net Cash Provided by
 Operating Activities:
  Depreciation and Amortization                                      4,125        3,955
  Provision for Losses on Accounts Receivable                          852          728
  Recoverable(Refundable)Gas Costs                                   1,856       (2,845)
  Deferred Income Taxes                                               (854)       1,063
Changes in Assets and Liabilities Which Provided (Used) Cash:
  Accounts Receivable                                               (5,359)      (6,018)
  Other Receivables                                                    204          227
  Inventories                                                          878          678
  Accounts Payable                                                  (1,130)        (546)
  Taxes Accrued                                                      2,621        1,435
  Other                                                             (1,571)       1,107
                                                                  ---------------------

      Total Adjustments                                              1,622         (216)
                                                                  ---------------------
Net Cash Provided by Operating Activities                            4,601        3,242
                                                                  ---------------------
Cash Flows from Investing Activities:
  Construction Expenditures                                         (5,197)      (5,737)
                                                                  ---------------------
Cash Flows from Financing Activities:
  Dividends Paid                                                    (1,946)      (2,095)
  Proceeds from Issuance of Long-Term Debt                               0       16,000
  Proceeds from(Payments on)Notes Payable                            1,345       (2,455)
  Redemption of Preferred Stock                                        (42)      (9,360)
  Proceeds from Other Stock Transactions                             1,330          586
                                                                  ---------------------
  Net Cash Provided by Financing Activities                            687        2,676
                                                                  ---------------------
Net Increase in Cash                                                    91          181
Cash at Beginning of Period                                            356          196
                                                                  ---------------------
Cash at End of Period                                             $    447     $    377
                                                                  ---------------------

Supplemental Disclosures of Cash Flow Information:

  Cash Paid During the Year for:
    Interest(net of amount capitalized)                           $  3,253     $  3,157
                                                                  =====================
    Income Taxes(net of refund)                                   $    352     $      6
                                                                  =====================
</TABLE>


See Independent Accountants' Review Report and Notes to Financial Statements.



The Berkshire Gas Company
Notes to Financial Statements
March 31,1998
----------------------------------------------------------------------------
(Dollars in Thousands Except Share Amounts)

NOTES:

   OTHER FINANCIAL INFORMATION:

      The accompanying unaudited financial statements have been prepared in 
accordance with the instructions to Form 10-Q and do not include all of the 
information and footnotes required by generally accepted accounting 
principles for complete financial statements.  All adjustments, which in the 
opinion of management are necessary for a fair presentation of the 
operations for the interim periods presented, have been made.  These 
adjustments are of a normal recurring nature.  The results of operations for 
such interim periods are not necessarily indicative of results of operations 
for a full year.  These financial statements should be read in conjunction 
with the summary of accounting policies and notes to financial statements 
included in the Company's Annual Report on Form 10-K for the year ended June 
30, 1997.

      The Company received approval on January 30, 1998 from the Massachusetts
Department of Telecommunications and Energy ("DTE") to proceed with the 
process of forming a holding company. The Company's management and Board of 
Directors consider it to be in the best interest of Berkshire Gas and its 
shareholders to adopt a holding company structure.  Berkshire Gas would 
become a wholly-owned subsidiary of a new parent company.  This reorganization
will require shareholder approval. On February 24, 1998, the Company filed 
with the SEC Form S-4 Registration Statement/Proxy. A special meeting of 
shareholders is scheduled for Friday May 8, 1998, for the purpose of voting 
on this reorganization.

      On February 6, 1988, the Company signed an agreement to enter into a 
joint venture with a major energy marketer.  The affiliation will extend 
opportunities to sell a variety of energy services in areas where the 
Company now operates.


NEW ACCOUNTING PRONOUNCEMENT:

      Effective December 31, 1997, the Company, as required, retroactively 
adopted Statement of Financial Accounting Standards No. 128 "Earnings Per 
Share" ("SFAS").  The statement established new standards for computing and 
presenting earnings per share ("EPS") and requires restatement of prior 
years information.  As such, EPS for all prior periods presented has been 
restated to conform with SFAS 128.  Due to the capital structure of the 
Company basic and diluted EPS are equal.

      Statement of Financial Accounting Standards No. 132, "Employers' 
Disclosures about Pensions and other Postretirement Benefits," was issued in 
February, 1998.  SFAS 132 revised employer's disclosures about pension and 
other postretirement benefits, but does not change the measurement or 
recognition of those plans.  The Statement is effective for the Company's 
1999 financial statements, with earlier application permitted.  The impact 
on the Company's disclosures is not expected to be significant.


CONTINGENCIES:

   ENVIRONMENTAL:

      Like other companies in the natural gas industry, the company is a 
party to governmental actions associated with former gas manufacturing 
sites.  Management estimates that expenditures to remediate and monitor 
known environmental sites will range from $3,290 to $12,302. In accordance 
with SFAS No. 5, the Company has recorded the most likely cost of $3,290.  
The Company's unamortized cost at March 31, 1998 was $955 and should be 
recovered over a seven-year period through the Cost of Gas Adjustment Clause 
("CGAC").



        Management's Discussion and Analysis of Financial Condition and
                            Results of Operations

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

Results of Operations - Third Quarter Ended March 31, 1998 versus Third 
Quarter Ended March 31, 1997

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

      Berkshire Gas considers Operating Margin (Operating Margin or Gross 
Profit = Operating Revenues Net of Cost of Gas Sold) to be a more pertinent 
measure of operating results than Operating Revenues.  This is due primarily 
to the fact that revenues include changes in the cost of natural gas which 
must be recovered or returned to customers through the Cost of Gas 
Adjustment Clause.  Consequently, changes in the cost of gas will affect 
revenue levels, but does not have a corresponding affect on income.  
Additionally, margins earned on interruptible gas sold and transported are 
flowed back to the customers and therefore are not included in income.  
Accordingly, the discussion below pertains to Operating Margin.

      Operating Margin increased $101,000 or 0.9%, despite warmer weather, 
from the three months ended March 31, 1997, primarily due to growth in 
commercial volumes and customers.

<TABLE>
<CAPTION>
                                                     1998           1997
                                                  -----------    -----------

<S>                                               <C>            <C>
3 Month Firm MCF Sold & Transported                 2,559,000      2,642,000
3 Month Operating Margin                          $11,237,000    $11,136,000
3 Month Average Operating Margin Per Firm MCF           $4.39          $4.21
</TABLE>

      Other Operating Expenses increased $104,000 or 3.1% from the three 
months ended March 31, 1997.  The increase is primarily due to higher 
professional fees due to the reorganization in response to the deregulation 
of the gas industry, increased costs to upgrade technologies and higher 
medical benefit costs. Partially offsetting these increases are reductions 
in pension costs and meter reading expenses.

      Depreciation Expense increased $66,000 due to an increase in the 
amount of depreciable assets.

      Other Income decreased $405,000 primarily due to lower Propane 
revenues reflecting warmer weather as well as lower margins due to market 
conditions.  Contributing to a lesser extent was lower jobbing revenues and 
less interest income from the undercollection of gas costs from customers 
through the CGAC. 

      Dividends on Common Stock increased $37,000 due to an increase in the 
number of shares reflecting active shareholder participation in the Dividend 
Reinvestment Program ("DRIP").

      The Allowance for Doubtful Accounts on Utility Service Accounts 
Receivable increased by $237,000 since June 30, 1997, reflecting the current 
status of doubtful accounts.


        Management's Discussion and Analysis of Financial Condition and
                            Results of Operations

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

Results of Operations - Nine Months Ended March 31, 1998 versus Nine Months 
Ended March 31, 1997

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

      Operating Margin increased $788,000 or 3.9% as compared with the nine 
months ended March 31, 1997 for the same reasons as discussed in the Third 
Quarter Results.

<TABLE>
<CAPTION>
                                                     1998           1997
                                                  -----------    -----------

<S>                                               <C>            <C>
9 Month Firm MCF Sold & Transported                 4,983,000      4,989,000
9 Month Operating Margin                          $20,868,000    $20,080,000
9 Month Average Operating Margin Per Firm MCF           $4.18          $4.02
</TABLE>

      Other Operating Expenses increased $490,000 or 5.4% from the nine 
months ended March 31, 1997.  The increase is due to  higher Production 
Expenses due to the amortization of environmental cleanup costs, higher 
Transmission and Distribution Expense due to re-allocation of the work force 
and leasing expense due to the change to leasing versus buying vehicles, 
higher costs relating to upgrading information systems, increased collection 
costs, medical benefit costs, as well as higher Administrative and General 
expenses as a result of the reorganization in response to deregulation.  
Partially offsetting these increases were lower pension and meter reading 
expenses.

      Depreciation expense increased $159,000 due to an increase in the 
amount of depreciable assets.

      Other Income decreased $469,000 or 22.0%, and Dividends on Common 
Stock increased $105,000 or 5.7% for the same reasons as discussed in the 
Results of Operations - Third Quarter.

      Due to the increase of long-term debt used to retire the 8.4% 
Preferred Stock series as well as additional short-term borrowings to 
finance gas costs, Interest Expense increased $445,000 which was partially 
offset by a reduction of $254,000 in the requirements for Preferred Stock 
dividends.

      Income Taxes decreased $367,000 or 17.0% due to a decrease in Pre-Tax 
Income.


        Management's Discussion and Analysis of Financial Condition and
                            Results of Operations

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

Results of Operations - Twelve Months Ended March 31, 1998 versus Twelve 
Months Ended March 31, 1997

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

      Earnings available for Common Stock were $3,065,000 for the twelve 
months ended March 31, 1998 as compared to $3,282,000 for 1997.  The 
decrease is primarily due to increased operating expenses and lower other 
income caused by a warmer heating season.

      Operating Margin increased $1,043,000 or 4.2% from the twelve months 
ended March 31, 1997.  The Company increased firm volumes sold and 
transported through growth in customers and usage, which more than offset 
the 7% warmer than normal weather.

<TABLE>
<CAPTION>
                                                      1998          1997
                                                   -----------   -----------

<S>                                                <C>           <C>
12 Month Firm MCF Sold & Transported                 6,424,000     6,348,000
12 Month Operating Margin                          $26,040,000   $24,997,000
12 Month Average Operating Margin Per Firm MCF           $4.05         $3.94
</TABLE>

      Other Operating Expenses rose $709,000 or 6.0% over the twelve months 
ended March 31, 1997.  The increase is due to Higher Production, 
Transmission and Distribution, Customer Accounts and Administrative and 
General Expenses.  These expenses have increased for the same reasons as 
noted above.

      Other Income decreased $366,000 or 16.2% from 1997 primarily due to 
lower Propane revenues as a result of the substantially warmer weather.  
This was partially offset by increased income from Appliance Rentals. 

      Interest Expense increased $727,000 due to the increase in long-term 
debt used to retire the $8,000,000, 8.4% Preferred Stock series and the 
associated debt restructuring expenses.  As a result of this restructuring 
dividends on Preferred Stock decreased by $426,000.  A tax savings of 
$164,000 was realized from this restructuring.

      Dividends declared on Common Stock increased $107,000 due to 
additional shares outstanding through the Company's DRIP.

LIQUIDITY AND CAPITAL RESOURCES - MARCH 31, 1998

      The Company added approximately $5,197,000 to Plant assets during the 
nine months ended March 31, 1998.  These construction expenditures primarily 
represent investments in new and replacement mains and services.

      The capital structure of the Company at March 31, 1998 was 45.6% 
Common Equity, 0.4% Preferred Stock and 54.0% Long-Term Debt.

      Cash flows from operating activities have increased over the nine 
month period ended March 31, 1998, primarily due to the recovery of prior 
period gas costs through the CGAC, partially offset by increases in Accounts 
Receivable.

      The Company initially finances construction expenditures and other 
funding needs primarily with short-term bank borrowings, and to a lesser 
extent with the reinvestment of dividends.  

      The Company continually evaluates its short-term borrowing position 
and based on prevailing interest rates, market conditions, etc., makes 
determinations regarding conversion of short-term borrowings to long-term 
debt or equity.  

      It is management's view that the Company has adequate access to 
capital markets and will have sufficient capital resources, both internal 
and external, to meet anticipated capital requirements.

      Funds for environmental clean-up costs are initially financed through 
short-term borrowings and all such costs will be recovered over a seven year 
period under a ruling issued by the Massachusetts Department of 
Telecommunications and Energy ("DTE"), formerly referred to as the 
Massachusetts Department of Public Utilities ("MDPU").

NEW ACCOUNTING PRONOUNCEMENT:

      Effective December 31, 1997, the Company, as required, retroactively 
adopted Statement of Financial Accounting Standards No. 128 "Earnings Per 
Share " ("SFAS").  The statement established new standards for computing and 
presenting earnings per share ("EPS") and required restatement of prior 
years information.  As such, EPS for all prior periods presented have been 
restated to conform with SFAS 128.  Due to the capital structure of the 
Company basic and diluted EPS are equal. 

      Statement of Financial Accounting Standards No. 132, "Employers' 
Disclosures about Pensions and other Postretirement Benefits," was issued in 
February, 1998.  SFAS 132 revised employer's disclosures about pension and 
other postretirement benefits, but does not change the measurement or 
recognition of those plans.  The Statement is effective for the Company's 
1999 financial statements, with earlier application permitted.  The impact 
on the Company's disclosures is not expected to be significant.


      Cautionary Statement for Purposes of the "Safe Harbor" Provisions
      of the Private Securities Litigation Reform Act of 1995


      This Quarterly Report contains forward-looking statements within the 
meaning of the Private Securities Litigation Reform Act of 1995.  Actual 
results could differ materially from those contemplated by such statements.  
Such statements reflect management's current views, are based on many 
assumptions and are subject to risks and uncertainties.

      Certain important factors which could cause such results to differ 
include risks associated with the Company's maintaining contracts with 
specific customers, government regulation, the increasingly competitive 
nature of the markets in which the Company is engaged, and dependence on key 
personnel.  These factors are not intended to represent a complete list of 
the general or specific risks that may affect the Company.



PART II  -  OTHER INFORMATION

Item 1.     Legal Proceedings
-----------------------------

            No developments during the quarter.

Item 2.     Changes in Securities
---------------------------------

            Not Applicable

Item 3.     Defaults Upon Senior Securities
-------------------------------------------

            Not Applicable

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

            None

Item 5.     Other Information
-----------------------------

            The Company received approval on January 30, 1998 from the DTE 
            to proceed with the process of forming a holding company.  The 
            Company's management and Board of Directors consider it to be in 
            the best interest of Berkshire Gas and its shareholders to adopt 
            a holding company structure.  Berkshire Gas would become a 
            wholly-owned subsidiary of a new parent company.  This 
            reorganization will require shareholder approval. On February 
            24, 1998, the Company filed with the SEC Form S-4 Registration
            Statement/Proxy. A special meeting of shareholders is 
            scheduled for Friday May 8, 1998, for the purpose of voting on 
            this reorganization.

            On February 6, 1988, the Company signed an agreement to enter 
            into a joint venture with a major energy marketer.  The 
            affiliation will extend opportunities to sell a variety of 
            energy services in areas where the Company now operates.

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

           (a)   List of Exhibits
                 Exhibit 27 - Financial Data Schedule

                 Exhibit 99 - Form S-4 Registration Statement/Proxy filed by 
                 Berkshire Energy Resources on February 24, 1998 (File No. 
                 333-46799) and is incorporated herein by reference.



The balance sheet as of March 31, 1998, the related statements of income and 
retained earnings for the three month, nine month and twelve month periods 
ended March 31, 1998 and 1997, and the statements of cash flows for the nine 
month periods ended March 31, 1998 and 1997 have been reviewed, prior to 
filing, by the Registrant's independent public accountants, Deloitte & 
Touche LLP, whose report covering their review of the financial statements 
is presented below.


Deloitte &
   Touche LLP

            City Place                              Telephone:(860) 280-3000
            185 Asylum Street                       Facsimile:(860) 280-3051
            Hartford, Connecticut 06103-3402


INDEPENDENT ACCOUNTANTS' REPORT

The Berkshire Gas Company:

We have reviewed the accompanying balance sheet of The Berkshire Gas Company 
as of March 31, 1998,  the related statements of income and retained 
earnings for the three month, nine month and twelve month periods ended 
March 31, 1998 and 1997, and the statements of cash flows for the nine month 
periods ended March 31, 1998 and 1997.  These financial statements are the 
responsibility of the Company's management.

We conducted our reviews in accordance with standards established by the 
American Institute of Certified Public Accountants.  A review of interim 
financial information consists principally of applying analytical procedures 
to financial data and making inquiries of persons responsible for financial 
and accounting matters.  It is substantially less in scope than an audit 
conducted in accordance with generally accepted auditing standards, the 
objective of which is the expression of an opinion regarding the financial 
statements taken as a whole.  Accordingly, we do not express such an 
opinion.

Based on our reviews, we are not aware of any material modifications that 
should be made to such financial statements for them to be in conformity 
with generally accepted accounting principles.  

We have previously audited, in accordance with generally accepted auditing 
standards, the balance sheet of The Berkshire Gas Company as of June 30, 
1997, and the related statements of income and retained earnings and of cash 
flows for the year then ended (not presented herein); and in our report 
dated August 15, 1997, we expressed an unqualified opinion on those 
financial statements.  In our opinion, the information set forth in the 
accompanying balance sheet as of June 30, 1997 is fairly stated, in all 
material respects, in relation to the balance sheet from which it has been 
derived.

/s/ Deloitte & Touche LLP
April 29, 1998



                                 SIGNATURES
                                 ----------


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



                                        THE BERKSHIRE GAS COMPANY
                                        ------------------------------------
                                        Registrant



                                        /s/ Michael J. Marrone
                                        ------------------------------------
                                        Michael J. Marrone 
                                        Vice President, Treasurer & Chief 
                                        Financial Officer


Dated: April 30, 1998