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

                                  Subject Company:  Columbia Energy Group
                                           Commission File No:  333-33896

   On April 4, 2000, Gary L. Neale, Chairman, President and Chief
   Executive Officer of NiSource Inc. and Oliver G. Richard III,
   Chairman, President and Chief Executive Officer of Columbia Energy
   Group issued a joint letter to employees of NiSource Inc. and Columbia
   Energy Group.  The following is a transcript of the joint letter
   issued on April 4, 2000:



       JOINT LETTER TO EMPLOYEES OF NISOURCE AND COLUMBIA ENERGY GROUP
                                APRIL 4, 2000



   [NiSource Logo]                           [Columbia Energy Group Logo]



   April 4, 2000


   Dear NiSource/Columbia Colleagues:

        A few weeks ago, our companies announced a definitive agreement
   for a merger that will create a compelling super-regional force in
   America's energy industry.  This agreement was a first step toward the
   transformation of our organizations into a combined entity that will
   be the largest energy provider east of the Rocky Mountains.

        The merger process officially began with our public announcement,
   but the combination of two organizations as large and complex as
   Columbia and NiSource requires careful planning efforts by people from
   both companies.  Recently, we announced the four leaders of the merger
   transition team.  They and their team are working hard to chart a
   high-level structure for the combined company, and to define the
   transition and integration processes.

        Philosophically, we strongly believe the result of our efforts
   must be a NEW company that carries forward the best of its
   predecessors.  It will not simply be a larger version of NIPSCO, or
   Columbia Gas subsidiaries or Bay State, and the adjustments required
   for its creation will be felt by all companies--not just Columbia and
   its subsidiaries.

        Key milestones in this process are the approval of the merger
   agreement by shareholders and regulatory authorities.  This week we
   filed documents to begin the shareholder approval process.  Coupled







   with filings in the past few days with authorities in Pennsylvania and
   Virginia, this is a good start in the process to gain regulatory
   approvals for the merger at state and federal levels.  Representatives
   of NiSource and Columbia together have met with federal and state
   officials to identify and clarify key issues prior to our official
   filings with their agencies, and will continue to communicate with
   them as appropriate.   These meetings have been very positive.

        As the process moves forward, we know it also can be a time of
   uncertainty and concerns.  We commit to give you clear and timely
   information.  We will communicate decisions, structure and policies--
   significant transition and integration news--as soon as possible.

        In turn, we will look to you to provide input on topics,
   questions and concerns throughout our transition and integration
   process, so that our communications efforts can meet your needs.
   Please feel free to contact your human resources or communications
   staff on these issues.

        During this transition period, until regulatory and shareholder
   approvals are received and the merger is completed, NiSource and
   Columbia will continue to operate as independent companies.  The
   success of our business going forward depends on your ability to meet
   and exceed the day-to-day expectations of our customers, shareholders
   and colleagues.

        We ask for your continued support during this transition period,
   and hope that the information in our merger communications will
   minimize any distractions resulting from rumors and speculation.

        On behalf of NiSource and Columbia management, thank you for your
   support and participation in this time of transformation.


   Sincerely,

        Gary Neale                         Rick Richard
        Chairman, President and            Chairman, President and
        Chief Executive Officer            Chief Executive Officer
        NiSource Inc.                      Columbia Energy Group


        /s/ Gary Neale                     /s/ Rick Richard


                                    # # #


        We have included the following in accordance with federal
   securities laws:

             This letter contains 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 document.  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 the document.

             NiSource and the new holding company have filed a
             registration statement, which contains a joint proxy
             statement/prospectus of NiSource and Columbia, 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
             contain important information.  Investors and security
             holders are able to receive the final joint proxy
             statement/prospectus and other documents free of charge at
             the SEC's web site, www.sec.gov, from NiSource at its web
             site, www.nisource.com, or from Columbia at its web site,
             www.columbiaenergygroup.com.  Information concerning the
             identity of the participants in the solicitation of proxies
             by the NiSource Inc. and Columbia Energy Group boards of
             directors and their direct or indirect interest, by security
             holdings or otherwise, may be obtained from the Secretary of
             NiSource Inc. or the Secretary of Columbia Energy Group at
             the respective addresses listed above.