Document:

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                                                                   Exhibit 10.01

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                    EQUITABLE RESOURCES, INC. TRUST AGREEMENT

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                   EQUITABLE RESOURCES, INC. TRUST AGREEMENT

         THIS AGREEMENT made this 1st day of November, 1997 by and between
EQUITABLE RESOURCES, INC. ("Company") and PNC BANK, NATIONAL
ASSOCIATION ("Trustee").

         WHEREAS, Company has adopted the nonqualified deferred compensation
plan listed in Appendix A (the "Plan");

         WHEREAS, Company has incurred or expects to incur liability under the
terms of the Plan with respect to the individuals participating in the Plan (the
"Participants");

         WHEREAS, Company wishes to establish a trust (the "Trust") and to
contribute to the Trust the assets that shall be held therein, subject to the
claims of Company's creditors in the event of Company's insolvency, as herein
defined, until paid to Participants and their beneficiaries in such manner and
at such times as specified in the Plan;

         WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974;
and

         WHEREAS, it is the intention of Company to make contributions to the
Trust to provide itself with a source of funds to assist it in the meeting of
its liabilities under the Plan.

         NOW THEREFORE, the parties do hereby establish the Trust and agree that
the Trust shall be comprised, held and disposed of as follows.

SECTION 1. ESTABLISHMENT OF TRUST.

         (a) Company hereby deposits with Trustee in Trust an amount which shall
become the principal of the Trust to be held, administered and disposed of by
Trustee as provided in this Trust. The Trust hereby established shall be
irrevocable upon acceptance of the initial contribution by the Trustee.

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         (b) The Trust is intended to be a grantor trust, of which Company is
the grantor, within the meaning of subpart E, part I, subchapter J, chapter 1,
subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.

         (c) The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of Company and shall be used exclusively for
the uses and purposes of the Participants and general creditors as herein set
forth. The Participants and their beneficiaries shall have no preferred claim
on, or any beneficial ownership interest in, any assets of the Trust. Any rights
created under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of the Participants and their beneficiaries against Company.
Any assets held by the Trust will be subject to the claims of Company's general
creditors under federal and state law in the event of insolvency, as defined in
Section 3(a) herein.

         (d) Company shall be required to irrevocably deposit cash or other
property to the Trust on a quarterly basis in an amount equal to the amount
deferred by the Participants, plus the amount, if any, of additional amounts
credited to the Participants pursuant to the terms of the Plan. In addition, in
the event of a "change of control" of Company (as defined in Section 13(e) of
this Trust), Company shall, as soon as possible, but in no event longer than 30
days following the change of control, make an irrevocable cash contribution in
an amount equal to the amount deferred by the Participants as of the date of the
change in control minus amounts previously contributed, plus the amounts, if
any, of additional amounts credited to the Participants which have not yet been
contributed pursuant to the terms of the Plan.

SECTION 2.  PAYMENTS TO THE PARTICIPANTS AND THEIR BENEFICIARIES.

         (a) Company shall deliver to Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of each Participant
(and his or her beneficiaries), that provides a formula or other instructions
acceptable to Trustee for determining the amounts so payable, the form in which
such amount is to be paid (as provided for or available under the Plan), and the
time of commencement for payment of such amounts. Except as otherwise provided
herein, Trustee shall make payments to the Participants and their beneficiaries
in accordance with such Payment Schedule. With respect to benefits attributable
to

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Participants and beneficiaries, Company shall be solely responsible for
determining the amounts of income that are taxable and reportable, determining
the nature and amounts of taxes to be withheld and for withholding, remitting
and reporting all such income and taxes to the applicable government entities.
Trustee shall have no duties with respect thereto.

         (b) The entitlement of a Participant or his or her beneficiaries to
benefits under the Plan shall be determined by Company or such party as it shall
designate under the Plan, and any claim for such benefits shall be considered
and reviewed under the procedures set out in the Plan. Company shall notify the
Trustee of such determination and shall direct commencement of payments of such
benefits.

         (c) Company may make payment of benefits directly to the Participants
or their beneficiaries as they become due under the terms of the Plan. Company
shall notify Trustee of its decision to make payment of benefits directly prior
to the time amounts are payable to Participants or their beneficiaries. In
addition, if the principal of the Trust, and any earnings thereon, are not
sufficient to make payments of benefits in accordance with the terms of the
Plan, Company shall immediately make up the balance of each such payment as it
falls due. Trustee shall notify Company when principal and earnings are not
sufficient to make benefit payments.

SECTION 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST BENEFICIARY WHEN
COMPANY IS INSOLVENT.

         (a) Trustee shall cease payment of benefits to the Participants and
their beneficiaries if the Company is Insolvent. Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) Company is unable to pay
its debts as they become due, or (ii) Company is subject to a pending proceeding
as a debtor under the United States Bankruptcy Code.

         (b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of Company under federal and state law as set forth
below.

             (1) The Board of Directors and the Chief Executive Officer of
Company shall have the duty to inform Trustee in writing of Company's
Insolvency. If a person claiming to be a creditor of Company alleges in writing
to Trustee that Company has become Insolvent, Trustee shall

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determine whether Company is Insolvent and, pending such determination, Trustee
shall discontinue payment of benefits to the Participants or their
beneficiaries.

             (2) Unless Trustee has actual knowledge of Company's Insolvency, or
has received notice from Company or a person claiming to be a creditor alleging
that Company is Insolvent, Trustee shall have no duty to inquire whether Company
is Insolvent. Trustee may in all events rely on such evidence concerning
Company's solvency as may be furnished to Trustee and that provides Trustee with
a reasonable basis for making a determination concerning Company's solvency.

             (3) If at any time Trustee has determined that Company is
Insolvent, Trustee shall discontinue payments to the Participants or their
beneficiaries and shall hold the assets of the Trust for the benefit of
Company's general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of the Participants or their beneficiaries to pursue their
rights as general creditors of Company with respect to benefits due under the
Plan or otherwise.

             (4) Trustee shall resume the payment of benefits to the
Participants or their beneficiaries in accordance with Section 2 of this Trust
Agreement only after Trustee has determined that Company is not Insolvent (or is
no longer Insolvent)

         (c) Provided that there are sufficient assets, if Trustee discontinues
the payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to the
Participants or their beneficiaries under the terms of the Plan as certified to
the Trustee by the Company for the period of such discontinuance, less the
aggregate amount of any payments made to the Participants or their beneficiaries
by Company in lieu of the payments provided for hereunder during any such period
of discontinuance.

SECTION 4. PAYMENTS TO COMPANY.

         Except as provided in Section 3 hereof, Company shall have no right or
power to direct Trustee to return to Company or to divert to others any of the
Trust assets before all payment of benefits have been made to the Participants
and their beneficiaries pursuant to the terms of the Plan.

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SECTION 5. INVESTMENT AND ADMINISTRATIVE AUTHORITY.

         (a) The assets OF the Trust may be invested and reinvested in common
and preferred stocks, shares, or certificates of participation issued by
registered investment companies including registered investment companies for
which the Trustee or an affiliate thereof receives compensation for providing
custodial, transfer agency, investment advisory or other services, investment
trusts, common or pooled investment funds, bonds, debentures, insurance and
annuity contracts, limited partnership interests, obligations of governmental
bodies, both domestic and foreign, notes, commercial paper, certificates of
deposit, and other securities or evidences of indebtedness, secured or
unsecured, including variable amount notes, convertible securities of all types
and kinds, interest--bearing savings or deposit accounts with any federally
insured bank or trust company (including Trustee), or any federally insured
savings and loan association, and any other property permitted as trust
investments under applicable law. The Company acknowledges that interests in
registered investment companies are not bank deposits and are not incurred by,
guaranteed by, obligations of, or otherwise supported by the United States of
America, The Federal Deposit Insurance Corporation, PNC Bank, National
Association, or any bank or government entity. Notwithstanding anything to the
contrary, the Company may reserve to itself the right to direct the Trustee as
to the acquisition, retention or disposition of all or any portion of the assets
of the Trust. Upon receipt of a written notice from the Company advising the
Trustee that the Company has reserved such authority, the Trustee shall,
pursuant to such notice, invest all or any portion of the Trust assets
designated in such notice only in accordance with the instructions of the
Company. The Trustee shall be under no duty to question any instruction of the
Company. Any such instruction may be of a continuing nature or otherwise and may
be changed or revoked in writing by the Company at any time. In the absence of
such a written direction, the Trustee shall have the full authority as to the
acquisition, retention or disposition of the assets of the Trust. The Company
may revoke or amend the investment powers that it reserves to itself provided
such revocation or amendment is in writing and is consented to in advance by the
Trustee.

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         (b) Trustee has the power to hold any or all securities or property in
Trustee's name, as Trustee, or in the name of a nominee or nominee of an
affiliate, and in accounts or deposits administered in any location by Trustee
or any affiliate of Trustee. In the event the same are held in its own name or
in the name of a nominee or nominees, suitable designation is to be made upon
the books and records of Trustee that said securities or property are so held as
part of any trusts hereunder.

         (c) In no event may Trustee invest in securities (including stock or
rights to acquire stock) or obligations issued by Company, other than a de
minimis amount held in common investment vehicles in which Trustee invests. All
rights associated with assets of the Trust shall be exercised by Trustee or the
person designated by Trustee, and shall in no event be exercisable by or rest
with the Participant.

SECTION 6. DISPOSITION OF INCOME.

         During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.

SECTION 7. ACCOUNTING BY TRUSTEE

         Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between
Company and Trustee. Within 60 days following the close of each calendar year
and within 60 days after the removal or resignation of Trustee, Trustee shall
deliver to Company a written account of its administration of the Trust during
such year or during the period from the close of the last preceding year to the
date of such removal or resignation, setting forth all investments, receipts,
disbursements and other transactions effected by it, including a description of
all securities and investments purchased and sold with the cost or net proceeds
of such purchases or sales (accrued interest paid or receivable being shown
separately), and showing all cash, securities and other property held in the
Trust at the end of such year or as of the date of such removal or resignation,
as the case may be.

         The Company may approve the account either by written notice of
approval delivered to the Trustee or by failure to object in writing to the
Trustee within 90 days from the date on which the account was delivered to the
Trustee.

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Upon receipt of written approval of the account, or upon the expiration of the
90-day period without written objections, the account shall be approved, and the
Trustee shall be released and discharged with respect to the account as if the
account had been settled and allowed by a decree of a court of competent
jurisdiction. Nothing herein contained, however, shall be deemed to preclude the
Trustee of its right to have its account settled by a court of competent
jurisdiction.

SECTION 8. RESPONSIBILITY OF TRUSTEE.

         (a) Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, provided, however, that
Trustee shall incur no liability to any person for any action taken pursuant to
a direction, request or approval given by Company which is contemplated by, and
in conformity with, the terms of the Plan or this Trust and is given in writing
by Company, and provided further, that the Trustee shall incur no liability to
any person for any action or failure to act taken pursuant to a determination of
the existence or non-existence of an event of Insolvency pursuant to Section 3
hereunder. In the event of a dispute between Company and a party, Trustee may
apply to a court of competent jurisdiction to resolve the dispute.

         (b) If the Trustee undertakes, defends or settles any litigation
arising in connection with this Trust, Company agrees to indemnify the Trustee
against the Trustee's costs, expenses and liabilities (including, without
limitation, reasonable attorneys' fees and expenses) relating thereto and to be
primarily liable for such payments, except to the extent it is judicially
determined that any loss or damage is directly attributable to the Trustee's
(i) failure to exercise the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in a like capacity
and familiar with such matters would use in the conduct of an enterprise of a
like character and like aims, (ii) negligence or willful misconduct or (iii)
violation of applicable law. The Trustee shall provide the Company with advance
written notice of any such litigation. If Company does not pay such cost,
expenses and liabilities in a reasonably timely manner, Trustee may obtain
payment from the Trust.

         (c) Trustee may consult with legal counsel (who may also be counsel for
Company or the Trustee generally) with

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respect to any of its duties or obligations hereunder at the Company's expense
and shall have no liability for any action or failure to act in reasonable
reliance upon advice of such counsel.

         (d) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the Trust,
Trustee shall have no power to name a beneficiary of the policy other than the
Trust, to assign the policy (as distinct from conversion of the policy to a
different form) other than to a successor Trustee, or to loan to any person the
proceeds of any borrowing against such policy.

         (e) Notwithstanding any powers granted to Trustee pursuant to this
Trust Agreement or to applicable law, Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing the
gains therefrom, within the meaning of Section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.

         (f) Trustee, its affiliates, their officers, directors, employees and
agents, shall not be liable for any act or omission of Company, any investment
manager (other than an investment manager affiliated with Trustee), or any
officer, director, employee or agent of any of them (other than an officer,
director, employee or agent of an investment manager affiliated with Trustee).

SECTION 9. COMPENSATION AND EXPENSES OF TRUSTEE.

         Company shall pay all administrative and Trustee's fees and expenses as
shall be agreed upon. If not so paid, the fees and expenses shall be paid from
the Trust.

SECTION 10. RESIGNATION AND REMOVAL OF TRUSTEE.

         (a) Trustee may resign at any time by written notice to Company, which
shall be effective 60 days after receipt of such notice unless Company and
Trustee agree otherwise.

         (b) Trustee may be removed by Company on 60 days notice or upon shorter
notice accepted by Trustee.

         (c) Upon a Change of Control, as defined herein, Trustee may not be
removed by Company for three years.

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         (d) If Trustee resigns within three years of a Change of Control, as
defined herein, Trustee shall select a successor Trustee in accordance with the
provisions of Section 11(b) hereof prior to the effective date of Trustee
resignation or removal.

         (e) Upon resignation or removal of Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within 60 days after receipt of notice
of resignation, removal or transfer, unless Company extends the time limit.

         (f) If Trustee resigns or is removed, a successor shall be appointed in
accordance with Section 11 hereof, by the effective date of resignation or
removal under paragraph(s) (a) or (b) of this section. If no such appointment
has been made, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses of
the Trust.

SECTION 11. APPOINTMENT OF SUCCESSOR.

         (a) If Trustee resigns or is removed in accordance with Section 10(a)
or (b) hereof, Company may appoint any third party, such as a bank trust
department or other party that may be granted corporate trustee powers under
state law, as a successor to replace Trustee upon resignation or removal. The
appointment shall be effective when accepted in writing by the new Trustee, who
shall have all of the rights and powers of the former Trustee, including
ownership rights in the Trust assets. The former Trustee shall execute any
instrument necessary or reasonably requested by Company or the successor Trustee
to evidence the transfer.

         (b) If Trustee resigns pursuant to the provisions of Section 10(d)
hereof and selects a successor Trustee, Trustee may appoint any third party such
as a bank trust department or other party that may be granted corporate trustee
powers under state law. The appointment of a successor Trustee shall be
effective when accepted in writing by the new Trustee. In the event that the
Trustee is required to appoint a successor trustee hereunder, the Company agrees
that the Trustee shall be held harmless from all liability and expenses relating
to such appointment, the indemnification provision in Section 13(d) specifically
shall apply, and if a successor trustee requires indemnification or hold
harmless protection, such

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indemnification or protection will be provided by the Company or any successor
thereto and not the Trustee. Nothing herein contained, however, shall be deemed
to preclude the Trustee from applying to a court of competent jurisdiction for
the appointment of a successor trustee.

SECTION 12. AMENDMENT OR TERMINATION.

         (a) This Trust Agreement may be amended by a written instrument
executed by Trustee and Company. Notwithstanding the foregoing, following a
change of control of the Company, no amendment may be made by the Company which
adversely affects the rights of Participants to benefits under the Plan unless
the amendment is agreed to in writing by more than 75% of the Participants
entitled to the payment of benefits under the Plan as of the date of the
amendment.

         (b) The Trust shall not terminate until the date on which the
Participants and their beneficiaries are no longer entitled to benefits pursuant
to the terms of the Plan. Upon termination of the Trust, any assets remaining in
the Trust shall be returned to Company.

         (c) Upon written approval of more than 75% of the Participants entitled
to the payment of benefits under the Plan, Company may terminate this Trust
prior to the time all benefit payments under the Plan have been made. All assets
in the Trust at termination shall be returned to Company.

         (d) Notwithstanding any other provision in this Trust Agreement, this
Trust Agreement may not be amended within one year after the occurrence of a
Change of Control.

SECTION 13. MISCELLANEOUS.

         (a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.

         (b) Benefits payable to Participants and their beneficiaries under this
Trust Agreement may not be anticipated, assigned (either at law or in equity),
alienated, pledged, encumbered or subjected to attachment, garnishment, levy,
execution or other legal or equitable process.

         (c) This Trust Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania.

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         (d) The Trustee shall be indemnified and saved harmless by the Company
from and against any and all liability to which the Trustee may be subjected in
carrying out its duties under this Agreement (including any liability incurred
as a result of compliance with instructions of the Company, its agents or
employees), except to the extent it is judicially determined that any loss or
damage is directly attributable to the Trustee's (i) failure to exercise the
care, skill, prudence and diligence under the circumstances then prevailing that
a prudent person acting in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character and like aims, (ii)
negligence or willful misconduct or (iii) violation of applicable law. The
indemnification provided to the Trustee shall also apply to any liability
arising from the actions or nonactions or any predecessor trustee or fiduciary
or other fiduciaries of the Plan.

         (e) For purposes of this Trust, Change of Control shall mean any of the
following events (each of such events being herein referred to as a "Change of
Control"):

             (1) The sale or other disposition by the Company of all or
substantially all of its assets to a single purchaser or to a group of
purchasers, other than to a corporation with respect to which, following such
sale or disposition, more than eighty percent (80%) of, respectively, the then
outstanding shares of Company common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election of
the Board of Directors is then owned beneficially, directly or indirectly, by
all or substantially all of the individuals and entities who were the beneficial
owners, respectively, of the outstanding Company common stock and the combined
voting power of the then outstanding voting securities immediately prior to such
sale or disposition in substantially the same proportion as their ownership of
the outstanding Company common stock and voting power immediately prior to such
sale or disposition;

             (2) The acquisition in one or more transactions by any person or
group, directly or indirectly, of beneficial ownership of twenty percent (20%)
or more of the outstanding shares of the Company common stock or the combined
voting power of the then outstanding voting securities of the Company entitled
to vote generally in the election of the Board of Directors; provided, however,
that any acquisition by (1) the Company or any of its subsidiaries, or any
employee benefit plan (or related

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trust) sponsored or maintained by the Company or any of its subsidiaries or (2)
any person that is eligible, pursuant to Rule 13d-1(b) under the Exchange Act
(as such rule is in effect as of November 1, 1995), to file a statement on
Schedule 13G with respect to its beneficial ownership of Company common stock
and other voting securities whether or not such person shall have filed a
statement on Schedule 13G, unless such person shall have filed a statement on
Schedule 13D with respect to beneficial ownership of fifteen percent (15%) or
more of the Company's voting securities, shall not constitute a Change of
Control;

             (3) The Company's termination of its business and liquidation of
its assets;

             (4) There is consummated a merger, consolidation, reorganization,
share exchange, or similar transaction involving the Company, (including a
triangular merger), in any case, unless immediately following such transaction:
(i) all or substantially all of the persons who were the beneficial owners of
the outstanding common stock and outstanding voting securities of the Company
immediately prior to the transaction beneficially own, directly or indirectly,
more than 60% of the outstanding shares of common stock and the combined voting
power of the then outstanding voting securities entitled to vote generally in
the election of directors of the corporation resulting from such transaction
(including a corporation or other person which, as a result of such transaction,
owns the Company or all or substantially all of the Company's assets through one
or more subsidiaries (a "Parent Company")) in substantially the same proportion
as their ownership of the common stock and other voting securities of the
Company immediately prior to the consummation of the transaction, (ii) no person
(other than the Company, any employee benefit plan sponsored or maintained by
the Company or, if reference was made to equity ownership of any Parent Company
for purposes of determining whether clause (i) above is satisfied in connection
with the transaction, such Parent Company) beneficially owns, directly or
indirectly, 20% or more of the outstanding shares of common stock or the
combined voting power of the voting securities entitled to vote generally in the
election of directors of the corporation resulting from such transaction and
(iii) individuals who were members of the Company's Board of Directors
immediately prior to the consummation of the transaction constitute at least a
majority of the members of the board of directors resulting from such
transaction (or, if reference was made to equity ownership of any Parent Company
for purposes of determining whether clause (i) above is satisfied in connection
with the transaction, such Parent Company); or

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             (5) The following individuals cease for any reason to constitute a
majority of the number of directors then serving: individuals who, on the date
hereof, constitute the entire Board of Directors and any new director (other
than a director whose initial assumption of office is in connection with an
actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) whose
appointment or election by the Board or nomination for election by the Company's
shareholders was approved by a vote of a least two-thirds (2/3) of the directors
then still in office who either were directors on the date hereof or whose
appointment, election or nomination for election was previously so approved.

SECTION 14. EFFECTIVE DATE.

         The effective date of this Trust Agreement shall be November 1, 1997.

<TABLE>
<S>                                      <C>
                                         EQUITABLE RESOURCES, INC.

Attest: /s/ David J. Smith               By: /s/ Gregory R. Spencer
       ---------------------------          --------------------------------------------

                                         Name: Gregory R. Spencer
                                              ------------------------------------------

                                         Title: Sr. V.P. & Chief Administrative Officer
                                               -----------------------------------------

                                         PNC BANK,
                                         NATIONAL ASSOCIATION

Attest: /s/ Valerie Washington           By: /s/ Richard S. Larimer
       ---------------------------          --------------------------------------------

                                         Name: Richard S. Larimer
                                              ------------------------------------------

                                         Title: Sr. Vice President
                                               -----------------------------------------
</TABLE>

                                       13<PAGE>   1
                                                                    Exhibit 10.4

                            EQUITABLE RESOURCES, INC.
                              SHORT-TERM BONUS PLAN

         EQUITABLE RESOURCES, INC. (the "Company") hereby establishes this
EQUITABLE RESOURCES, INC. SHORT-TERM BONUS PLAN (the "Plan") as of this 23rd day
of February, 1999, in accordance with the terms provided herein.

         WHEREAS, the Company has maintained various bonus programs for the
benefit of its employees; and

         WHEREAS, the Company desires to consolidate the structure of the bonus
programs to a single, focused initiative which describes the goals of the
Company and the methodology for awarding bonus amounts under the programs; and

         WHEREAS, the terms of this Plan will replace and supersede the relevant
terms of the various bonus programs that exist throughout the Company.

         NOW, THEREFORE, the Company hereby adopts the terms of the Plan as
follows:

SECTION 1.     BONUS PROGRAM STRATEGY. The Company's main purposes in providing
bonus programs are to maintain a competitive level of total cash compensation
and to align the interests of the Company's employees with those of the
Company's shareholders, customers, and with the strategic objectives of the
Company. By placing a portion of employee compensation at risk, the Company can
reward performance based on the overall performance of the Company, the business
segment and the individual contribution of each employee.

SECTION 2.     EFFECTIVE DATE. The Effective Date of this Plan is
January 1, 1999. The plan will remain in effect until formally amended or
terminated in writing by the Company's Chief Executive Officer.

SECTION 3.     ELIGIBILITY. Specific eligibility requirements for each program
under this Plan are proposed by the assigned Business Segment President or
Company Officer and approved by the Corporate Chief Administrative Officer.
Employees that are eligible to participate in a program are notified in writing
of their participation and given a Plan document for their reference.

SECTION 4.     ADMINISTRATION OF THE PLAN. Any program that covers the officers
of the Company shall be administered by the Company's Chief Administrative
Officer, under the general direction of the Company's President and Chief
Executive Officer. The Company's Director of Compensation and Benefits shall
administer all other programs under the general direction of the Company's Chief
Administrative Officer.

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On an annual basis, the Compensation Committee of the Board of Directors must
review and approve the Equitable Resources Corporate Short - Term Bonus Program,
its participants, their bonus targets, the methodology for funding the bonus
pool, and the projected payout under the program. They must also review and
approve all bonus payouts under this program, as well as any proposed amendments
throughout the plan year. Further, all other bonus programs and projected payout
amounts by program must be reviewed by the Compensation Committee on an annual
basis.

SECTION 5.     EFFECT ON INDIVIDUAL PROGRAMS. This Plan shall serve to provide
specific direction to the following bonus programs (collectively referred to as
the "Bonus Programs"):

          o    Equitable Resources Corporate Short-Term Bonus Program
          o    Equitable Utilities Short-Term Bonus Program
          o    Equitable Production - East Short-Term Bonus Program
          o    Equitable Production - Gulf Short-Term Bonus Program
          o    Equitable Services Short-Term Bonus Program

This list is exhaustive of bonus programs throughout the Company. All bonus
programs not listed above are terminated effective December 31, 1998 unless
otherwise approved in writing by the Company's Chief Executive Officer.

SECTION 6.     DEFINITIONS. The following provides the definition of financial
and operational measures used in all Bonus Programs

         (a)      Net Income After Tax. This measure shall be determined by the
                  Chief Financial Officer of the Company. The formula for Net
                  Income After Tax for the Corporate Short Term Bonus Program is
                  as follows:

                           TOTAL REVENUE OF THE COMPANY MINUS TOTAL EXPENSES OF
                           THE COMPANY FOR THE PLAN YEAR.

                  For purposes of this paragraph, Total Revenue shall mean
                  revenue from continuing operations. Income from unusual items
                  as determined by the Company's Chief Financial Officer will be
                  excluded. Expenses shall include interest, taxes, corporate
                  overhead and the accrual charge for the incentive program
                  funding, all of which are also determined by the Chief
                  Financial Officer of the Company. Expenses from unusual items
                  as determined by the Company's Chief Financial Officer will
                  also be excluded. The Chief Executive Officer is responsible
                  for reviewing all unusual items and may recommend their
                  inclusion from financial calculations to the Compensation
                  Committee of the Board of Directors for final approval as
                  he/she may determine to maintain the spirit of the Plan.

                                       2
<PAGE>   3

                  The formula for Net Income After Tax for all other Bonus
                  Programs is total revenue of the business segment minus total
                  expenses using the same methodology described above. An
                  exception, however, is made when calculating the expenses
                  associated with business segment interest and taxes. The
                  process for calculating this exception is described below:

                  In determining Business Segment Net Income, pro forma
                  financials below the Business Segment Earnings Before Interest
                  and Taxes ("EBIT") line will be used. For purposes of
                  calculating Interest and Taxes, the Segment capital structure,
                  tax rate, and interest rate will be fixed at the capital
                  structure, tax rate and interest rate reflected in the
                  respective Segment's final 1999 business plan. Interest will
                  be determined by multiplying 1) the predetermined interest
                  rate, 2) predetermined % debt in the capital structure and 3)
                  the 12-month average actual total capital employed during the
                  year. Taxes will be determined by multiplying the
                  predetermined effective tax rate by the Segment's pre-tax
                  income and then deducting a predetermined amount of investment
                  tax credit amortization. This calculation will be done by the
                  business segment presidents and submitted to the Company's
                  Chief Financial Officer for review and approval. The Company's
                  Chief Financial Officer will determine, for purposes of this
                  Plan, the final business segment Net Income After Tax to be
                  used in determining bonus awards.

         (b)      Company return on total capital as compared to a selected peer
                  group. The return on total capital shall be expressed in
                  quartiles and shall be compared against the return on total
                  capital of a peer group. The corporate peer group shall be
                  selected by the President and Chief Executive Officer of the
                  Company, and the comparison shall be made by the Chief
                  Financial Officer of the Company. The corporate peer group for
                  1999 is as follows: Columbia Energy Group, Consolidated
                  Natural Gas, Energen, KN Energy, MCN Energy Group, National
                  Fuel Gas, Oneok, Questar, Sonat, and Southwestern. The source
                  for return on total capital data for the peer group is
                  published by Value Line.

                  The corporate return on total capital shall be determined in
                  accordance with the following formula:

                  NET INCOME AFTER TAX + (INTEREST X (1 - EFFECTIVE TAX RATE))
                  ------------------------------------------------------------
                   (SHORT AND LONG TERM DEBT + PREFERRED STOCK + BOOK EQUITY)

                  For purposes of this paragraph, all factors in the denominator
                  of the calculation described above shall be calculated by
                  determining each specific factor at the end of December of the
                  previous year and each specific factor at the end of December
                  in the Plan year. The actual number used is calculated by
                  averaging the resulting two numbers for each factor.

                                       3
<PAGE>   4

         (c)      Production. For purposes of this Plan, Production is the
                  operation of delivering crude gas from the bottom of the well
                  bore to separators or field gas processing equipment.

         (d)      Net Income Ratio. The Net Income Ratio is calculated by
                  dividing the actual Net Income, determined as specified in
                  paragraph (a) above, by the Net Income forecasted in the
                  approved business plan.

SECTION 7.     DETERMINATION OF BONUS POOLS. All Bonus Programs shall hereafter
provide bonus amounts that are funded based on bonus pools. The bonus pools
shall be determined by a specific and defined financial measure. An additional,
defined, operational measure may be added at the discretion of the Company's
Chief Executive Officer. The following chart provides the specific financial and
operational measures for each of the approved programs.

------------------------------------------------------------------------------
Short - Term Bonus Program        Financial Measure       Operational Measure
------------------------------------------------------------------------------
Equitable Resources Corporate    Net Income After Tax   Competitive Return on
                                                            Total Capital
------------------------------------------------------------------------------
Equitable Utilities              Net Income After Tax       Not Applicable
------------------------------------------------------------------------------
Equitable Production - East      Net Income After Tax      Production Goals
------------------------------------------------------------------------------
Equitable Production - Gulf      Net Income After Tax      Production Goals
------------------------------------------------------------------------------
Equitable Services               Net Income After Tax       Not Applicable
------------------------------------------------------------------------------

Each bonus pool is funded based on the criteria listed above. The funding of
each program is included in the attachments to this document.

The Compensation Committee of the Board of Directors reserves the right to
adjust the funding of any pool created under this Plan by any amount up to
twenty-five (25%) percent. This adjustment will be based on the impact of
weather and gas, oil and liquids prices. This adjustment may be either positive
or negative.

SECTION 8.     BONUS TARGETS. Each participant under the Plan shall be given a
bonus target that shall be determined based on market competitive levels. Bonus
targets for all Company Officers shall be determined at the beginning of each
plan year and approved by the Compensation Committee of the Board of Directors.
All other bonus targets shall be determined, in consultation with the
appropriate business segment president or corporate officer at the beginning of
each plan year by Compensation and Benefits, and approved by the Chief
Administrative Officer. Actual bonus payments shall be based on overall bonus
pool funding and, for designated participants with specified individual
performance goals, on individual performance.

                                       4
<PAGE>   5

SECTION 9.     PERFORMANCE GOALS. Each exempt level participant must have
specific performance goals developed for his/her position for the subject bonus
year. These performance goals must support the approved business plan and should
identify how the participant will support the specific value drivers established
by executive management. A copy of each participant's performance goals and
objectives must be developed and on file with the appropriate business segment
Human Resources Department by February 15 of the Plan year.

For those participants with specified individual performance goals, any bonus
payment will be determined based on an evaluation of that participant's actual
performance relative to those goals. Performance can be rated as Outstanding,
Successful or Unsatisfactory. The definition of each rating is as follows:

     Performance Level              Performance Definition
     -----------------              ----------------------

     Outstanding                    Performance consistently exceeds
                                    established expectations. Performance at
                                    this level creates new standards
                                    of performance.

     Successful                     Performance meets and often exceeds
                                    established performance expectations.

     Unsatisfactory                 Performance is not meeting expectations in
                                    one or more of the performance criteria
                                    listed above. Performance at this level is a
                                    serious problem and will result in no bonus
                                    payout.

       Based on the employee's performance relative to their objectives,
individual bonus adjustments can be made by the business segment president or
appropriate corporate officer ranging from no bonus to 150% of the bonus target.
The Company's Chief Executive Officer must approve any recommendation to make an
adjustment in excess of 150%. He/she has the final approval of all bonus
adjustments and awards to participants under this Plan.

                                       5
<PAGE>   6

SECTION 10.    DISTRIBUTING THE BONUS POOL. Bonuses are distributed based on
bonus pool funding and individual performance. The distribution is a four-step
process.

(1)      The bonus pool is funded as described in Section 7. If the bonus
         pool is not funded, the process to calculate bonus awards is
         terminated.
(2)      The performance of each employee is reviewed by the business segment
         president and the performance factor described in Section 9 is applied
         to the employee's original bonus target.
(3)      The bonus targets after performance adjustments for each employee are
         totaled. The percent of each employee's adjusted bonus target is
         calculated as a percent of the total bonus targets for all employees.
(4)      The percent assigned to each employee in step 3 is multiplied by the
         total pool generated, resulting in the employee's actual bonus award.

SECTION 11.    POOL DISTRIBUTION FOR SELECTED EMPLOYEES. The distribution of the
pool for selected employees is calculated as follows:

Employees that are direct reports to the Company's Chief Executive Officer and
are Presidents of Equitable business segments will have eighty percent (80%) of
their bonus tied to the performance of the Corporate bonus pool and twenty
percent (20%) of their bonus tied to the performance of their specific business
segment bonus pool. Employees that are direct reports to Business Segment
Presidents will have twenty percent (20%) of their bonus target tied to the
performance of the Corporate bonus pool and eighty percent (80%) of their bonus
tied to the performance of the appropriate business segment bonus pool.

In addition, employees that are direct reports to the Company's Chief Executive
Officer will be required to defer at least twenty percent (20%) of their bonus
into the Company's common stock fund in the Company's Deferred Compensation
Plan. Employees that are direct reports to executives that report directly to
the Company's Chief Executive Officer will be required to defer at least ten
(10%) of their bonus into the Company's common stock fund in the Company's
Deferred Compensation Plan. This deferral will vest equally over a two-year
period beginning one year after the date of deferral. The employee will be asked
to give specific distribution elections as provided under the Deferred
Compensation Plan for all deferrals.

Employees required to defer a percentage of their bonus will be given the
opportunity to defer and invest in Company common stock an additional amount
over the minimum required amount described above. All deferrals over the
required minimum will be matched by the Company with .25 shares of stock
contributed to the employee's account for each share of stock purchased by the
deferral of bonus over the required minimum. These shares vest equally over a
three-year period beginning one year after the date of deferral. The employee
will be asked to give specific distribution elections as provided

                                       6
<PAGE>   7

under the Deferred Compensation Plan for all deferrals. There is no limit on the
number of matching shares.

All shares that are deferred and matched will have dividends applied and
reinvested as appropriate throughout the year. Employees that resign from the
Company forfeit all unvested shares.

Shares described in this section will be used when determining an executive's
overall status regarding meeting their specific stock ownership guidelines. For
purposes of this section, executives are corporate officers that report directly
to the President and Chief Executive Officer.

SECTION 12.    IMPACT ON BENEFIT PLAN. Payments under the Plan shall not be
considered as earnings for purposes of the Company's qualified retirement plans
or any such retirement or benefit plan unless specifically provided for and
defined under the plan.

SECTION 13.    TAX CONSEQUENCES. It is intended that nothing in this Plan shall
change the tax consequences of the Bonus Programs under Federal or State law and
specifically shall not cause the participants in the Bonus Programs to be taxed
currently under the Constructive Receipt or Economic Benefit Doctrines and as
expressed in Sections 451 and 83 of the Internal Revenue Code of 1986, as
amended.

SECTION 14.    CHANGE OF STATUS. The President and Chief Executive Officer may
decide to include or exclude an employee from the Plan under this section at
his/her complete and sole discretion. In making such decisions, he/she may
consider any factors that he/she may consider relevant. The recommendation to
include an employee in the plan must be done by the business segment president
or appropriate corporate officer upon the occurrence of the event described
below. The following guidelines are provided as general information regarding
employee status changes:

         (a)      New Hire, Transfer, Promotion. A newly hired employee or an
                  employee promoted or transferred during the performance year
                  to a position qualifying for participation MAY be recommended
                  for a pro rata award based on the level of participation in
                  his/her previous program and the percentage of the performance
                  year the employee is in the participating position. This
                  includes employees that leave positions that qualify for bonus
                  payments in other Company business segments. These potential
                  payments shall be considered when calculating the employee's
                  bonus target under this Plan.

         (b)      Demotion. No award shall be made to an employee who has been
                  demoted during the performance year because of performance. If
                  the demotion is due to an organizational change, a pro rata
                  award MAY be made, provided the employee otherwise qualifies
                  for an incentive payment.

                                       7
<PAGE>   8

         (c)      Termination. Any employee whose services are terminated during
                  the performance year for reasons of misconduct, failure to
                  perform, or other cause, shall not be considered for an award.
                  If the termination is due to reasons such as reorganization,
                  and not due to the fault of the employee, the employee MAY be
                  considered for a pro rata award.

         (d)      Resignation. An employee who resigns to accept employment
                  elsewhere (including self-employment) before bonuses are paid
                  shall not be considered for an award. If the resignation is
                  due to other reasons (e.g., ill health, disability), the
                  employee MAY be considered for a pro rata award.

         (e)      Death, Disability, Retirement, Leave of Absence and Layoff. An
                  employee whose status as an active employee is changed during
                  the performance year for any reason other than the reasons
                  cited above MAY be considered for a pro rata award. In the
                  event of an employee's death, earned awards for previous plan
                  years ended prior to the employee's death shall be paid to the
                  employee's estate.

SECTION 15.    DISPUTE RESOLUTION. The following is the exclusive procedure to
be followed by all participants in resolving disputes arising from payments made
under this Plan. All disputes relative to a given plan year must be presented to
the Chief Administrative Officer of the Company within thirty (30) days
following the award date for that plan year, or the participant's right to
dispute a payment will be irrevocably waived. Once the Chief Administrative
Officer has been notified of a dispute, he/she will assemble a Compensation
Review Committee (CRC) to review the issue. The CRC will consist of the
following: the Chief Administrative Officer, the manager of the employee with
the dispute, the business segment head, and a peer chosen by the employee with
the dispute. The employee with the concern will be given an opportunity to
present his/her issues to the CRC. A decision will be rendered by the CRC within
ten (10) business days of the meeting. The Chief Administrative Officer will be
responsible for preparing a written version of the decision. This decision may
be appealed to the President and Chief Executive Officer of the Company.
Appealed decisions will be reviewed by the President and Chief Executive Officer
with information requested from appropriate parties as he/she may determine in
his/her sole discretion. The decision made by the President and Chief Executive
Officer regarding the matter is final and binding on all Plan participants.

                                       8
<PAGE>   9

SECTION 16.    AMENDMENT OR TERMINATION OF THIS PLAN. The Company shall have the
right to amend or terminate the Plan at any time by written action approved by
the Company's President and Chief Executive Officer in his/her complete and sole
discretion. The Company shall notify affected employees in writing of any
amendment or Plan termination.

         IN WITNESS WHEREOF, the Company hereby adopts the Plan as of the date
first written above,

ATTEST:                             EQUITABLE RESOURCES, INC.

/s/ Jean F. Marks               By: /s/ Murry S. Gerber
------------------------            --------------------------------------
Jean F. Marks                       Murry S. Gerber

                                Title: President and Chief Executive Officer
                                       -------------------------------------

                                       9
<PAGE>   10

             Equitable Corporate Short - Term Bonus Program Funding

                           Bonus Pool Funding Multiple

-----------------------------------------------------------------------
                            Competitive ROTC Performance
-----------------------------------------------------------------------
 Net Income  4th Quartile  3rd Quartile  2nd Quartile    1st Quartile
 Ratio (1)
-----------------------------------------------------------------------
 < 100%            0             0               0              0
-----------------------------------------------------------------------
   100%          .75          1.00            1.25           1.50
-----------------------------------------------------------------------
   105%          .83          1.25            1.50           1.75
-----------------------------------------------------------------------
   110%          .92          1.50            1.75           2.00
-----------------------------------------------------------------------
   115%         1.00          1.75            2.00           2.25
-----------------------------------------------------------------------
   120%         1.00          2.00            2.25           2.50
-----------------------------------------------------------------------
   125%         1.00          2.25            2.50           2.75
-----------------------------------------------------------------------

(1) Company Actual Net Income divided by Business Plan Net Income

(2) For 1st, 2nd and 3rd quartile performance, the bonus pool multiple continues
    to increase by .25 times for each additional 5% of Net Income Ratio.

                                       10
<PAGE>   11

         Equitable Utilities Short - Term Bonus Program Funding

         ---------------------------------------------------
            Net Income Ratio (1)       Bonus Pool Funding
                                           Multiple (2)
         ---------------------------------------------------
                < 100%                           0
         ---------------------------------------------------
                  100%                        1.00
         ---------------------------------------------------
                  105%                        1.25
         ---------------------------------------------------
                  110%                        1.50
         ---------------------------------------------------
                  115%                        1.75
         ---------------------------------------------------
                  120%                        2.00
         ---------------------------------------------------
                  125%                        2.25
         ---------------------------------------------------

(1) Business Segment Actual Net Income divided by Business Plan Net Income

(2) The bonus pool multiple continues to increase by .25 times for each
    additional 5% of Net Income Ratio.

                                       11
<PAGE>   12

          Equitable Production - East Short-Term Bonus Program Funding

                           Bonus Pool Funding Multiple

     --------------------------------------------------------------
                                         Production
      Net Income Ratio (1)  41.4bcf to < 43.5 bcf   43.5 bcf + (2)
     --------------------------------------------------------------
         < 100%                       0                    0
     --------------------------------------------------------------
           100%                    1.00                 1.50
     --------------------------------------------------------------
           105%                    1.16                 1.75
     --------------------------------------------------------------
           110%                    1.33                 2.00
     --------------------------------------------------------------
           115%                    1.50                 2.25
     --------------------------------------------------------------
           120%                    1.50                 2.50
     --------------------------------------------------------------
           125%                    1.50                 2.75
     --------------------------------------------------------------

(1) Business Segment Actual Net Income divided by Business Plan Net Income

(2) For production performance above 43.5 bcf, the bonus pool multiple continues
    to increase by .25 times for each additional 5% of Net Income Ratio.

                                       12
<PAGE>   13

         Equitable Production - Gulf Short - Term Bonus Program Funding

                           Bonus Pool Funding Multiple

          ---------------------------------------------
                                       Production
          ---------------------------------------------
            Business Segment
               Net Income       < 26.1 bcf  26.1 bcf +
          ---------------------------------------------
               $        1            0         1.00
          ---------------------------------------------
               $1,000,000            0         1.50
          ---------------------------------------------
               $2,000,000 +          0         2.00
          ---------------------------------------------

         Note:      For production performance above 26.1 bcf, the bonus pool
                    will be funded at the discretion of the President and Chief
                    Executive Officer.

                                       13
<PAGE>   14

          Equitable Services Short - Term Bonus Program Funding

          ---------------------------------------------------
             Net Income Ratio (1)       Bonus Pool Funding
                                            Multiple
          ---------------------------------------------------
                 < 100%                           0
          ---------------------------------------------------
                   100%                        1.00
          ---------------------------------------------------
                   122%                        1.25
          ---------------------------------------------------
                   144%                        1.50
          ---------------------------------------------------
                   166%                        1.75
          ---------------------------------------------------
                   188%                        2.00
          ---------------------------------------------------
                   210%                        2.25
          ---------------------------------------------------

(1) Actual Net Income divided by Business Plan Net Income.

                                       14
<PAGE>   15

                            EQUITABLE RESOURCES, INC.
                              SHORT-TERM BONUS PLAN
                                 AMENDMENT NO. 1

         THIS AMENDMENT NO. 1 to the Equitable Resources Short-Term Bonus Plan
(the "Plan") is hereby made this 27th day of October 1999, as provided below.

         WHEREAS, the Plan, as established by the Company effective February 23,
1999, provided for certain calculations to be made in connection with peer group
comparisons; and

         WHEREAS, on October 27, 1999, the Compensation Committee of the
Company's Board of Directors authorized amendment of the Plan to modify certain
aspects of such calculations.

         NOW, THEREFORE, the Plan shall be amended, effective October 27, 1999,
as follows:

         1. The Plan be and hereby is amended by deleting the last two sentences
of the first paragraph of Section 6(b) thereof and substituting the following in
lieu thereof:

                  The corporate peer group is as follows: Columbia Energy Group,
                  Consolidated Natural Gas, Energen, KN Energy, MCN Energy
                  Group, National Fuel Gas, Oneok, Questar, Sonat and
                  Southwestern, to be adjusted by the Chief Financial Officer as
                  he deems appropriate in the event of transactions involving
                  any of the named peer group companies.

         2. The Plan be and hereby is amended by deleting the second and third
sentences of the second paragraph of Section 6(b) thereof (following the
formula) and substituting the following lieu thereof:

                  For purposes of this paragraph, all factors in the denominator
                  of the calculation described above shall be calculated by
                  determining each specific factor at the end of December of the
                  previous year and at the end of each of the four quarters of
                  the Plan year. The actual number used is calculated by
                  averaging the resulting five numbers for each factor.

                                       15
<PAGE>   16

         IN WITNESS WHEREOF, the Company has caused this Amendment No. 1 to be
executed by its officers thereunto authorized as of the day and year first
written above.

                                         EQUITABLE RESOURCES, INC.

                                         /s/ Gregory R. Spencer
                                         ------------------------------------
                                         Gregory R. Spencer
                                         Senior Vice President
                                         and Chief Administrative Officer

ATTEST:

/s/ Jean F. Marks
--------------------------------------
Jean F. Marks

                                       16

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