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

                                  Subject Company:  Columbia Energy Group
                                Registration Statement File No: 333-33896


        On August 22, 2000, NiSource announced that it has appointed the
   key leadership to be in place in Kentucky upon completion of its $6
   billion merger with Columbia Energy Group.  Joe Kelly has been named
   executive vice president and chief operating officer of Columbia Gas
   of Kentucky.  The text of the press release is set forth below.


                            TEXT OF PRESS RELEASE
                               AUGUST 22, 2000


   FOR ADDITIONAL INFORMATION
   Maria Hibbs         Steve Byars
   NiSource Inc.       Columbia Gas of Kentucky
   219-647-6201        859-288-0227


                  NISOURCE ANNOUNCES POST-MERGER LEADERSHIP
             KELLY TO CONTINUE TO LEAD COLUMBIA GAS OF KENTUCKY

        MERRILLVILLE, Ind. (August 22, 2000)   NiSource Inc. has
   appointed the key leadership to be in place in Kentucky upon
   completion of its $6 billion merger with Columbia Energy Group, which
   was announced Feb. 28 and is expected to close by year-end.

        Joe Kelly has been named executive vice president and chief
   operating officer of Columbia Gas of Kentucky.

        "Kentucky continues to play an important role in NiSource's
   strategy to create a super-regional gas distribution powerhouse
   through the Midwest and into the Northeast," said Gary L. Neale,
   NiSource chairman, president and chief executive officer.

        Kelly will continue to report to Robert Skaggs, who was named
   president and chief executive officer for Columbia Gas of Kentucky,
   Columbia Gas of Ohio and Bay State Gas Company. Skaggs will report to
   Jeffrey Yundt, president of Energy Distribution for NiSource.

        "Joe Kelly will continue to provide strong leadership to our
   Kentucky operations," Yundt said. "Joe's commitment to working with
   key stakeholders will prove invaluable during this time of change in
   our industry."

        Columbia Gas of Kentucky serves more than 141,000 customers in 31
   Kentucky counties. The new NiSource will serve more than 3.6 million
   gas and electric customers primarily located in nine states.  Its
   operations will span the high-growth energy corridor that extends from



   the Gulf of Mexico through Chicago to New England, creating the
   largest natural gas distributor east of the Rockies, with wholesale
   and retail electric operations.

        The NiSource/Columbia merger is on target to close by the end of
   2000, pending approval by the U.S. Securities and Exchange Commission.
   The combination was approved by the Federal Energy Regulatory
   Commission in July, following necessary state actions regarding the
   companies' distribution companies in Virginia, Pennsylvania, Maryland,
   Indiana, Kentucky, Massachusetts, Ohio, Maine and New Hampshire.  The
   transaction also recently cleared the waiting period under the Hart-
   Scott-Rodino Antitrust Improvements Act at the U.S. Department of
   Justice and the Federal Trade Commission.  Shareholders of both
   companies approved the merger in June.

        NiSource Inc. (NYSE: NI) 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
   through Chicago to Maine.  More information about the company is
   available on the Internet at www.nisource.com.

        Columbia Energy Group (NYSE: CG), based in Herndon, Va., is one
   of the nation's leading energy services companies.  Its operating
   companies engage in nearly all phases of the natural gas business,
   including exploration and production, transmission, storage and
   distribution, as well as propane and petroleum product sales and
   electric power generation.  More information about Columbia is
   available on the Internet at www.columbiaenergygroup.com.

        This release 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 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 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 territory, fluctuations in energy-related
        commodity prices, conversion activity, other marketing efforts
        and other uncertainties.  These and 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 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
        the document.

        In addition to other documents filed with the Securities and
        Exchange Commission by the two companies, NiSource and the new
        holding company have filed a registration statement, which
        contains a joint proxy statement for NiSource and Columbia Energy
        Group.  The final joint proxy statement/prospectus, dated April
        24, 2000, is available and has been distributed to the companies'
        shareholders.  Investment and security holders are urged to read
        the joint proxy statement/prospectus and other relevant documents
        filed with the SEC because they contain important information.
        Investors and security holders may 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 at its Web
        site, www.nisource.com, or from Columbia Investor Relations at
        13880 Dulles Corner Lane, Herndon, Virginia 20171 or at its Web
        site, www.columbiaenergygroup.com.

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