Filed by:  NiSource Inc.
                    Pursuant to Rule 425 under the Securities Act of 1933

                                  Subject Company:  Columbia Energy Group
                                           Commission File No:  001-01098

        On March 31, 2000, NiSource Inc. announced, in its annual report
   to shareholders, that its merger with Columbia Energy Group (NYSE:CG)
   fulfills its vision to build a super-regional energy company
   positioned to profit from the 60 percent growth rate projected for
   U.S. natural gas consumption by 2020 using new technologies.  The
   following is a transcript of the joint press release issued on March
   31, 2000:

                                PRESS RELEASE
                               MARCH 31, 2000

                                                          [NISOURCE LOGO]

   FOR IMMEDIATE RELEASE
   March 31, 2000

   FOR ADDITIONAL INFORMATION
   Investors:     Dennis Senchak Rae Kozlowski  Media:    Sally Anderson
                  NiSource Inc.  NiSource Inc.            NiSource Inc.
                  219-647-6085   219-647-6083             219-647-6203

   NiSource/Columbia Merger Creates Powerful Platform for Earnings Growth
             Annual Report Cites Strategy Using New Technologies

        MERRILLVILLE, Ind. (March 31, 2000)--NiSource Inc. (NYSE:NI) in
   its annual report today told shareholders its merger with Columbia
   Energy Group (NYSE:CG) fulfills its vision to build a super-regional
   energy company positioned to profit from the 60 percent growth rate
   projected for U.S. natural gas consumption by 2020 using new
   technologies.

    As the largest natural gas distributor east of the Rocky Mountains,
   the combined company will have access to 30 percent of the U.S.
   population consuming 40 percent of the nation's energy. The companies
   announced a definitive merger agreement February 28 under which
   NiSource will acquire all Columbia shares for approximately $6.0
   billion and assume about $2.5 billion in Columbia long-term debt.  The
   new enterprise value would be approximately $13.7 billion.

        "This transaction offers the opportunity to create significant
   shareholder value with lower risk and higher returns," Gary L. Neale,
   NiSource chairman, president and chief executive officer, wrote in his
   letter to shareholders published in the 1999 NiSource Annual Report
   distributed today.  "Although we anticipate that integration costs and
   other first-year expenses will reduce earnings by 10 to 15 cents per
   share in 2001, the combination is expected to add to earnings in 2002
   and beyond.  NiSource also intends to maintain its current dividend
   policy.
                                   -more-


   NISOURCE/COLUMBIA MERGE CREATES--2


        "We expect the transaction to close by the end of 2000, following
   approval by the shareholders of both companies and various regulatory
   commissions," he continued.

        Neale said NiSource business units that are supporting the
   emerging technologies strategy by focusing on new forms of electric
   generation systems powered by natural gas -- ranging from large
   cogeneration systems for industrial users, to microturbines for
   smaller businesses, to compact fuel cells for homes -- performed well
   in 1999.

        "We are developing energy products that will change the way
   electricity is generated and delivered to the factory, to the office,
   to the store and to the home," he explained. "We expect both the fuel
   cell and micro-generation product lines to become key components of
   the nation's future energy supply as economic, energy and
   environmental policies converge to encourage investment in technology
   that is cleaner and more efficient and not dependent on large-scale
   transmission systems."

        Acknowledging that NiSource's effort to acquire Columbia Energy
   Group "began as a contested transaction," Neale said Columbia s Board
   of Directors and senior management now fully support the combination
   and are committed to helping achieve a rapid and seamless integration
   of the two companies.

        Neale said NiSource has obtained a commitment from Credit Suisse
   First Boston and Barclays Bank Plc for a bank facility to finance the
   cash portion of the Columbia purchase price.  Anticipated asset sales
   of more than $1 billion will minimize equity needs and reduce
   leverage.

        "As a result, we fully expect to maintain a strong financial
   profile with solid investment-grade credit ratings," he added.

        Citing a NiSource/Columbia value chain with upstream, commodity
   distribution and downstream links, Neale said upstream opportunities
   are expected enable the combined company to reduce risk and add value
   through integrated capabilities in gas and electric supply, gas
   transportation and storage, asset-based commodity trading and utility
   services.

        "The flexibility embedded in the utilization and operation of our
   combined assets will allow us to create a virtually unlimited number
   of high value energy packages," he explained.  "With distribution
   assets in nine states, pipeline operations in 16 states and the
   largest storage capacity in the U.S., the NiSource/Columbia
   combination provides the greatest optionality opportunities in the
   industry."

                                   -more-


   NISOURCE/COLUMBIA MERGER CREATES--3


        Columbia gas distribution companies in Ohio, Kentucky,
   Pennsylvania, Maryland and Virginia link NiSource gas properties in
   Indiana with those in Massachusetts, New Hampshire and Maine.  The
   combined company also will have 19,000 miles of gas pipelines, 700
   billion cubic feet (bcf) of gas storage, 4,000 megawatts of power
   generation and 965 bcf of proven natural gas reserves.

        Turning to 1999 results as reported January 28, Neale said
   NiSource earnings per share declined 19 per cent from $1.60 in 1998 to
   $1.29 as a result of unseasonably warm winter and fall weather and
   less-than-ideal timing in closing its acquisitions of Bay State Gas
   Company and TPC Corporation. The NiSource stock price also was
   negatively impacted by the battering of energy and utility stock
   prices "as investors rushed to the dot-com startups."

        "Compared to our ten-year track record of outperforming the
   Standard & Poor's 500, our performance in 1999 was clearly below the
   standard we set for ourselves and what you have come to expect," he
   said.

        NiSource also exited a number of non-core businesses and
   facilities inconsistent with its strategic direction in 1999 and saw
   adverse economic conditions negatively impact equity investments,
   mostly in oil and gas development.  These events reduced net income by
   $21.7 million or 17 cents per share.

        NiSource Inc. is a holding company with headquarters in
   Merrillville, Ind., whose primary business is the distribution of
   electricity, natural gas and water in the Midwest and Northeastern
   United States. The company also markets utility services and customer-
   focused resource solutions along a corridor from Texas to Maine.  More
   information about the company is available on the Internet at
   www.nisource.com.

        Columbia Energy Group, based in Herndon, Va., is one of the
   nation's leading energy services companies, with assets of
   approximately $7 billion.  Its operating companies engage in virtually
   all phases of the natural gas business, including exploration and
   production, transmission, storage and distribution, as well as retail
   energy marketing, propane and petroleum product sales, and electric
   power generation. More information about Columbia is available on the
   Internet at www.columbiaenergygroup.com.

                                     ###

        This press release contains certain forward-looking
        statements within the meaning of the federal securities
        laws; these forward-looking statements are subject to
        various risks and uncertainties. The factors that could
        cause actual results to differ materially from the
        projections, forecasts, estimates and expectations discussed
        herein may include factors that are beyond the companies'
        ability to control or estimate precisely, such as estimates
        of future market conditions, the behavior of other market
        participants and the actions of the Federal and State
        regulators. Other factors include, but are not limited to,
        actions in the financial markets, weather conditions,


        economic conditions in the two companies' service
        territories, fluctuations in energy-related commodity
        prices, conversion activity, other marketing efforts and
        other uncertainties. Other risk factors are detailed from
        time to time in the two companies' SEC reports. Readers are
        cautioned not to place undue reliance on these forward-
        looking statements, which speak only as of the date of this
        press release. The companies do not undertake any obligation
        to publicly release any revisions to these forward-looking
        statements to reflect events or circumstances after the date
        of this press release.  Readers are cautioned not to place
        undue reliance on these forward-looking statements, which
        speak only as of the date of this press release.  The
        companies do not undertake any obligation to publicly
        release any revisions to these forward-looking statements to
        reflect events or circumstances after the date of this press
        release.

        NiSource and the new holding company will be filing a
        registration statement, which will contain a joint proxy
        statement/prospectus of NiSource and Columbia Energy, and
        other documents with the Securities and Exchange Commission.
        Investors and security holders are urged to read the joint
        proxy statement/prospectus and any other relevant documents
        filed with the SEC when they become available because they
        will contain important information. Investors and security
        holders will be able to receive the joint proxy
        statement/prospectus and other documents free of charge at
        the SEC's web site, www.sec.gov, from NiSource Investor
        Relations at 801 East 86th Avenue, Merrillville, Indiana
        46410 or from Columbia Investor Relations at 13880 Dulles
        Corner Lane, Herndon, Virginia 20171.