|                                     |
|------------------------------------------|
|                                     |
| When                recorded return to:  |
|                                     |
| Nicor                Gas                 |
| Attn:                Dave Behrens        |
| 1844                Ferry Road           |
| Naperville,                IL 60653-9600 |
|                                     |
|                                     |
|                                     | Space                Above this Line Reserved for Recorder’s Use                Only |

**Supplemental      Indenture**

**MADE      AS OF DECEMBER 1, 2006, TO BE EFFECTIVE DECEMBER 15, 2006**

**____________________**

**NORTHERN      ILLINOIS GAS COMPANY**

**TO**

**BNY      MIDWEST TRUST COMPANY**

**TRUSTEE      UNDER INDENTURE DATED AS OF**

**JANUARY      1, 1954 **

**AND      **

**SUPPLEMENTAL**

**INDENTURES      THERETO**

**____________________**

**FIRST      MORTGAGE BONDS**

**5.85%      SERIES DUE DECEMBER 15, 2036**

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**Company**
**Trustee**
**Indenture**

**bonds      of this Series**

----

**NORTHERN      ILLINOIS GAS COMPANY**

**First      Mortgage Bond, 5.85% Series due December 15, 2036**

**Company**

So      long      as there is no existing default in the payment of interest on this bond, the      interest so payable on any interest payment date will be paid to the person      in      whose name this bond is registered on May 15 or November 15 (whether or not      a      business day), as the case may be, next preceding such interest payment date.      If      and to the extent that the Company shall default in the payment of interest      due      on such interest payment date, such defaulted interest shall be paid to the      person in whose name this bond is registered on the record date fixed, in      advance, by the Company for the payment of such defaulted      interest.

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | **NORTHERN                ILLINOIS GAS COMPANY** BY:                                                                                                                     *                                                     Vice President*  |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ATTEST:                                                                                                       *                                                      Assistant Secretary* |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |

**BNY      MIDWEST TRUST COMPANY,**

**   TRUSTEE**

*                                        Authorized      Officer*

----

**bonds      of this Series**
**Supplemental      Indenture**
**Indenture**

principal      of or the interest or the premium, if any, on this bond, or the reduction in      the      principal amount hereof or in the rate of interest or the amount of any premium      hereon, or any other modification in the terms of payment of such principal,      interest or premium, which terms of payment are unconditional, or, otherwise      than as permitted by the Indenture, the creation of any lien ranking prior      to or      on a parity with the lien of the Indenture with respect to any of the mortgaged      property, all as more fully provided in the Indenture.

----

**Securities      Act**

----

----

**.        **

**“Make-Whole      Amount”**
*provided*

**“Called      Principal”**

**“Discounted      Value”**

**“Reinvestment      Yield”**
**“Bloomberg”**

----

** **

**“Remaining      Average Life”**

**“Remaining      Scheduled Payments”**
*provided*

**“Settlement      Date”**
**.**

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*Signature      Page Follows*

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| NORTHERN                ILLINOIS GAS COMPANY BY: /s/                GERALD P.                O'CONNOR                                     Gerald                P. O’ConnorVice                President Finance and Treasurer                                                                                                                         |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | ATTEST: BY:                /s/ NEIL J.                MALONEY                                                                                 Neil J. Maloney       Assistant                General Counsel and Assistant         Secretary  |
| BNY                MIDWEST TRUST COMPANY, *as                Trustee* BY:                /s/ L                GARCIA                                                                      Name:                L. GarciaTitle:                Assistant Vice President  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | ATTEST: BY:                /s/                D.G. DONOVAN                                                                           Name:                D. G. DONOVANTitle:                ASSISTANT SECRETARY                                                                                                                                  |

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|   |                       /s/              DAWN M.              OPON                          |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | *Notary                Public*                                                                                                                                                                                                                                                                                                       |

----

STATE      OF      ILLINOIS } SS:

|   |                         /s/              A.              HERNANDEZ                                     |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | *Notary                Public*                                                                                                                                                                                                                                                                                                               |

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**RECORDING      DATA**

| **County**            | **Document                No.**  |
|----------------------------|---------------------------------------|
| Cook                       | 0634231132                            |
| Adams                      | 200207661                             |
| Boone                      | 2006R13647                            |
| Bureau                     | 2006-R07190                           |
| Carroll                    | 2006R-5189                            |
| Champaign                  | 2006R33801                            |
| DeKalb                     | 2006-022746                           |
| DeWitt                     | 217551                                |
| DuPage                     | R2006-235746                          |
| Ford                       | 237644                                |
| Grundy                     | 472045                                |
| Hancock                    | 2006-3829                             |
| Henderson                  | 163193                                |
| Henry                      | 20-0610664                            |
| Iroquois                   | 06R5743                               |
| JoDaviess                  | 332228                                |
| Kane                       | 2006K133305                           |
| Kankakee                   | 2006030672                            |
| Kendall                    | 200600039633                          |
| Lake                       | 2006-00019905                         |
| LaSalle                    | 2006-30915                            |
| Lee                        | 2006008204                            |
| Livingston                 | 576019                                |
| McHenry                    | 2006R0089834                          |
| McLean                     | 2006-00034217                         |
| Mercer                     | 354534                                |
| Ogle                       | 0612757                               |
| Piatt                      | 327574                                |
| Pike                       | 06-4002                               |
| Rock                Island | 2006-29338                            |
| Stephenson                 | 20060081732                           |
| Tazewell                   | 200600028016                          |
| Vermilion                  | 06-15773                              |
| Whiteside                  | 10283-2006                            |
| Will                       | 2006R203956                           |
| Winnebago                  | 0673599                               |
| Woodford                   | 608607                                |