U5S

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.

FORM U5S

ANNUAL REPORT

For the Fiscal Year Ended September 30, 2000

Filed Pursuant to the

Public Utility Holding Company Act of 1935

by

National Fuel Gas Company

10 Lafayette Square, Buffalo, N.Y. 14203

                            NATIONAL FUEL GAS COMPANY
                            -------------------------

                            FORM U5S - ANNUAL REPORT
                            ------------------------
                  For the Fiscal Year Ended September 30, 2000
                  --------------------------------------------



                                TABLE OF CONTENTS
                                -----------------


                                                                          Page
                                                                          ----

ITEM  1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF
          SEPTEMBER 30, 2000                                                3

ITEM  2.  ACQUISITIONS OR SALES OF UTILITY ASSETS                           9

ITEM  3.  ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF
          SYSTEM SECURITIES                                                 9

ITEM  4.  ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM
          SECURITIES                                                       10

ITEM  5.  INVESTMENTS IN SECURITIES OF NONSYSTEM COMPANIES                 11

ITEM  6.  OFFICERS AND DIRECTORS
          Part   I.  Names, principal business address and
                     positions held as of September 30, 2000               12
          Part  II.  Financial connections as of September 30, 2000        16
          Part III.  Compensation and other related information            16

ITEM  7.  CONTRIBUTIONS AND PUBLIC RELATIONS                               21

ITEM  8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS
          Part   I.  Intercompany sales and services
                     (1)  Salaries of officers of the Registrant           22
                     (2)  Services rendered by Statutory Subsidiaries      23
                     (3)  Services rendered by Registrant                  29
          Part  II.  Contracts to purchase services or goods
                     between any System company and any affiliate          30
          Part III.  Employment of any person by any System
                     company for the performance on a continuing
                     basis of management services                          30

ITEM  9.  WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES               30

ITEM 10.  FINANCIAL STATEMENTS AND EXHIBITS
          Financial Statements (Index)                                     34
          Exhibits                                                         91

SIGNATURE                                                                 101





ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------

                           Number of Common  Percent of    Issuer    Owner's
Name of Company              Shares Owned   Voting Power Book Value Book Value
- ---------------              ------------   ------------ ---------- ----------

Registrant:                                             (Thousands of Dollars)
- ----------
National Fuel Gas Company
(Parent, Company or Registrant)          -            -           -          -

Statutory Subsidiaries:
- ----------------------
 National Fuel Gas Distribution
  Corporation (Distribution
  Corporation) (Note 1)              2,000         100%    $486,493   $486,493
    Unsecured Debt (Note 9)              -            -    $382,000   $382,000

 National Fuel Gas Supply
  Corporation (Supply
  Corporation) (Note 2)          1,013,802         100%    $272,567   $272,567
    Unsecured Debt (Note 9)              -            -    $164,900   $164,900

 Seneca Resources Corporation
  (Seneca Resources) (Note 3)      100,000         100%    $113,213   $113,213
    Unsecured Debt (Note 9)              -            -    $851,300   $851,300
  National Fuel Exploration Corp.
   (NFE)                                           100%    $ 80,505   $ 80,505
   Unsecured Debt (Note 9)               -            -    $153,087   $153,087
  Empire Exploration Company,
    Empire 1983 Drilling
    Program, Empire 1983
    Joint Venture (Note 10)            N/A         N/A     $    970   $    970

 Highland Forest Resources, Inc.
  (Highland) (Note 4)                4,500         100%    $  7,845   $  7,845
  Unsecured Debt (Note 9)                -            -    $ 60,100   $ 60,100

 Data-Track Account Services,
  Inc. (Data-Track) (Note 5)         1,000         100%    $    751   $    751

 Leidy Hub, Inc. (Leidy Hub)
  (Note 6)                           4,000         100%    $    715   $    715

 National Fuel Resources, Inc.
 (NFR) (Note 7)                     10,000         100%    $  5,033   $  3,033
   Unsecured Debt (Note 9)               -            -    $ 33,900   $ 33,900

 Horizon Energy Development, Inc.
  (Horizon) (Notes 8 and 11-12)      4,750         100%    $  4,545   $  4,545
    Unsecured Debt (Note 9)              -            -    $ 98,700   $ 98,700
  Sceptre Power Company *(Note 11)     N/A         100%    $  3,948   $  3,948
  Horizon Energy Holdings, Inc.
   (HEHI)(Note 12)                   2,000         100%    $101,754   $101,754
     Horizon Energy Development
      B.V. (HED B.V.)(Note 12)         400         100%    $101,754   $101,754
      United Energy, a.s. .
       (UE) (Note 12)           16,208,458       84.73%    $ 92,043   $100,780
       Unsecured Debt (Note 9)           -            -    $ 53,309   $ 53,309
       Teplarna Liberec, a.s.
        (TL) (Note 12)                  70          70%    $  8,618   $  7,565





ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------
         (Continued)
         -----------

                           Number of Common  Percent of    Issuer    Owner's
Name of Company              Shares Owned   Voting Power Book Value Book Value
- ---------------              ------------   ------------ ---------- ----------

Registrant:                                             (Thousands of Dollars)
- ----------

       Lounske tepelne
        Hospodarstvi, s.r.o
        (LTH) (Note 12)                N/A         100%    $     49   $     49
       SCT SoftMaker, s.r.o.
        (SM) (Note 12)                 N/A         100%    $     89   $     89
       Teplo Branany, s.r.o. (TB)
        (Note 12)                      N/A          49%    $      1   $      1
       Jablonecka teplarenska
        a realitni, a.s. (JTR)
        (Note 12)                      198       65.78%    $  5,745   $  5,497
        Unsecured Debt (Note 9)          -            -    $  3,443   $  3,443
        ENOP Company, s.r.o.
         (ENOP)(Note 12)               N/A         100%    $    557   $    663
      Horizon Energy Development,
       s.r.o. (HED) (Note 12)          N/A         100%    $  1,964   $  1,964
      Power Development, s.r.o.
       (PD) (Note 12)                  N/A         100%    $  1,240   $  1,240
       Teplarna Kromeriz a.s.
        (Kromeriz) (Note 12)         1,000         100%    $    586   $    586
         Unsecured Debt (Note 9)         -            -    $    142   $    142

 Upstate Energy Inc. (Upstate)
  (Note 13)                          1,000         100%    $   (815)  $   (815)
  Unsecured Debt (Note 9)                -            -    $  6,400   $  6,400

 Seneca Independence Pipeline
  Company (SIP) (Note 14)            1,000         100%    $    908   $    908
  Unsecured Debt (Note 9)                -            -    $ 12,000   $ 12,000

 Niagara Independence Marketing
  Company (NIM) (Note 16)            1,000         100%    $      1   $      1

 NFR Power, Inc. (Note 17)           1,000         100%    $  4,916   $  4,916

Notes:

 (1)    Distribution  Corporation is a public utility that sells natural gas and
        -------------------------
        provides gas transportation service in western New York and northwestern
        Pennsylvania.

 (2)    Supply  Corporation  is engaged  in the  transportation  and  storage of
        -------------------
        natural gas for affiliated and nonaffiliated companies.


 (3)    Seneca  Resources is engaged in the exploration for, and the development
        -----------------
        and purchase of, natural gas and oil reserves in the Gulf Coast of Texas
        and Louisiana, and in California,  Wyoming and in the Appalachian region
        of the United States.  Also,  exploration and production  operations are
        conducted  in the  provinces of Manitoba,  Alberta and  Saskatchewan  in
        Canada by Seneca's  wholly-owned  subsidiary,  National Fuel Exploration
        Corp.  (NFE),  an  Alberta,  Canada  corporation.  In  addition,  Seneca
        Resources is engaged in the  marketing  of timber from its  Pennsylvania
        land holdings.





ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------
         (Continued)
         -----------

 (4)    Highland   operates   several   sawmills   and  kilns  in   northwestern
        --------
        Pennsylvania  and  processes  timber  from  north-central  Pennsylvania,
        primarily high quality hardwoods.

 (5)    Data-Track provides collection services  (principally issuing collection
        ----------
        notices) primarily for the subsidiaries of the Company.

 (6)    Leidy Hub is a New York  corporation  formed to provide  various natural
        ---------
        gas hub services to customers in the eastern United States.

 (7)    NFR is  engaged  in the  marketing  and  brokerage  of  natural  gas and
        ---
        electricity  and the  performance  of  energy  management  services  for
        industrial,  commercial,  public  authority  and  residential  end-users
        throughout the northeastern United States.

 (8)    Horizon was formed to engage in foreign  and  domestic  energy  projects
        -------
        through investment in various business entities (see Notes 11-12).

 (9)    Unsecured debt is presented on pages 7-8.

(10)    In December  1983,  Empire  Exploration,  Inc.  (which was  subsequently
        merged into Seneca  Resources)  established  a drilling  fund  through a
        series of limited  partnerships in which it acts as general partner (See
        File No. 70-6909).  Empire Exploration,  Inc.'s aggregate  investment in
        all three limited partnerships amounted to $970,150.

(11)    Horizon  became  one  of  the  partners  in  Sceptre  Power  Company,  a
        California general partnership,  on September 15, 1995. This partnership
        was  dissolved  as of December  23, 1996 and is  currently  winding down
        operations.

(12)    Horizon owns 100% of the capital  stock of HEHI, a New York  corporation
        which owns 100% of HED B.V. HED B.V. in turn owns 100% of the  ownership
        interests of HED and PD (both Czech  corporations).  PD owns 100% of the
        ownership  interests of Kromeriz  (also a Czech  corporation).  HED B.V.
        owns 84.73% of United Energy,  a.s. (UE)(a corporation  created from the
        merger  of   Severoceske   teplarny,   a.s.   and  Prvni   severozapadni
        teplarenska,  a.s.  during fiscal  2000).  UE owns 100% of the ownership
        interests  of ENOP,  LTH and SM, 70% of the  ownership  interest  of TL,
        65.78%  of the  ownership  interest  of  JTR  and  49% of the  ownership
        interest of TB. All UE  subsidiaries  are Czech  corporations or limited
        liability companies. HED B.V. and its subsidiaries are primarily engaged
        in  district  heating  and  power  generation  operations  in the  Czech
        Republic.

(13)    Upstate is a New York  corporation  engaged  in  wholesale  natural  gas
        -------
        marketing and other energy-related activities.


(14)    SIP, a  Delaware  corporation,  holds a  one-third  general  partnership
        ---
        interest in Independence  Pipeline  Company  (Independence),  a Delaware
        general   partnership.   Independence,   after   receipt  of  regulatory
        approvals  and  upon securing  sufficient  customer  interest,  plans to
        construct and operate the Independence  Pipeline,  a 400-mile interstate
        pipeline system which would  transport about 916,000  dekatherms per day
        of natural gas from Defiance, Ohio to Leidy, Pennsylvania.





ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------
         (Continued)
         -----------


(16)    NIM,  a  Delaware  corporation,  owns a  one-third  general  partnership
        ---
        interest in DirectLink  Gas Marketing  Company,  which  partnership  was
        formed to engage in natural gas  marketing  and related  businesses,  in
        part by subscribing for firm transportation capacity on the Independence
        Pipeline.

(17)    NFR  Power,  Inc.  is a New York  corporation  designated  as an "exempt
        ----------------
        wholesale  generator"  under the Public Utility  Holding  Company Act of
        1935  and  is  developing  or  operating  mid-range   independent  power
        production facilities.






ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------
         (Continued)
         -----------

Note (10) Unsecured Debt
                                                Principal    Issuer      Owner's
Name of Company                                  Amount       Book        Book
   (Issuer)      Security Owned by Registrant     Owed        Value       Value
- ---------------  ----------------------------  ----------   ----------  --------
                                                    (Thousands of Dollars)
                                               ---------------------------------
 Corporation     Intercompany Notes:
                   7.48% Due February 18, 2003   $ 50,000     $ 50,000    $ 50,000
                   7.99% Due February 1, 2004     100,000      100,000     100,000
                   7.46% Due March 30, 2023        49,000       49,000      49,000
                   8.55% Due July 15, 2024         20,000       20,000      20,000
                   7.50% Due June 13, 2025         50,000       50,000      50,000
                   6.26% Due August 12, 2027       30,000       30,000      30,000
                   6.74% System Money Pool(1)      83,000       83,000      83,000
                                               ----------   ----------  ----------
                                                  382,000      382,000     382,000
                                               ----------   ----------  ----------
Supply
 Corporation     Intercompany Notes:
                   7.99% Due February 1, 2004      25,000       25,000      25,000
                   6.95% Due August 1, 2004        50,000       50,000      50,000
                   8.55% Due July 15, 2024         30,000       30,000      30,000
                   6.26% Due August 12, 2027       10,000       10,000      10,000
                   6.74% System Money Pool(1)      49,900       49,900      49,900
                                               ----------   ----------  ----------
                                                  164,900      164,900     164,900
                                               ----------   ----------  ----------
Seneca
 Resources       Intercompany Notes:
                   7.48% Due February 18,2003     100,000      100,000     100,000
                   6.95% Due August 1, 2004        50,000       50,000      50,000
                   6.39% Due May 27, 2008         120,000      120,000     120,000
                   6.18% Due March 1, 2009        100,000      100,000     100,000
                   6.26% Due August 12, 2027       50,000       50,000      50,000
                   6.74% System Money Pool(1)     193,100      193,100     193,100
                   6.69% Line of credit(1)        238,200      238,200     238,200
                                               ----------   ----------  ----------
                                                  851,300      851,300     851,300
                                               ----------   ----------  ----------

NFE                6.69% Line of Credit           153,087      153,087     153,087
                                               ----------   ----------  ----------

Highland           6.74% System Money Pool(1)      60,100       60,100      60,100
                                               ----------   ----------  ----------

Horizon          Intercompany Notes:
                   6.26% Due August 12, 2027       10,000       10,000      10,000
                   6.39% Due May 27, 2008          80,000       80,000      80,000
                   6.74% Line of credit             8,700        8,700       8,700
                                               ----------   ----------  ----------
                                                   98,700       98,700      98,700
                                               ----------   ----------  ----------

UE                 5.95%(2) Payable Quarterly
                    Through June 2006               2,509        2,509       2,509
                   5.59% Short-Term Bank Loan      17,099       17,099      17,099
                   5.835% (3) Payable March 2000-
                    December 2004                  33,701       33,701      33,701
                                               ----------   ----------  ----------
                                                   53,309       53,309      53,309
                                               ----------   ----------  ----------

JTR                8.35% Payable Monthly
                    Through January 2008            1,302        1,302       1,302
                   0.01% Payable Quarterly
                    Through December 2007             382          382         382
                   9.50% Payable Monthly
                    Through March 2001                 10           10          10
                   7.69% Short-Term Bank
                    Loan                            1,203        1,203       1,203
                   Intercompany Note                  546          546         546
                                               ----------   ----------  ----------
                                                    3,443        3,443       3,443
                                               ----------   ----------  ----------






ITEM 1.  SYSTEM COMPANIES AND INVESTMENTS THEREIN AS OF SEPTEMBER 30, 2000
- -------  -----------------------------------------------------------------
         (Concluded)
         -----------


Note (10) Unsecured Debt
                                                Principal    Issuer      Owner's
Name of Company                                  Amount       Book        Book
   (Issuer)      Security Owned by Registrant     Owed        Value       Value
- ---------------  ----------------------------  ----------   ----------  --------
                                                    (Thousands of Dollars)
                                               ---------------------------------


Kromeriz           8.5% Intercompany Note             142          142         142
                                               ----------   ----------  ----------

Upstate            6.74% System Money Pool(1)       6,400        6,400       6,400
                                               ----------   ----------  ----------

SIP                6.74% System Money Pool(1)      12,000       12,000      12,000
                                               ----------   ----------  ----------


NFR                6.74% System Money Pool (1)     33,900       33,900      33,900
                                               ----------   ----------  ----------

                                               $1,819,281   $1,819,281  $1,819,281
                                               ==========   ==========  ==========



 (1)    Interest rate represents  weighted average of all short-term  securities
        outstanding  at  September  30,  2000,  pursuant  to System  money  pool
        arrangement,  S.E.C.  File No. 70-8297  (Release Nos.  25964,  26076 and
        26196).

 (2)    Interest rate is six month PRIBOR (Prague  Interbank  Offered Rate) plus
        0.5%.

 (3)    Interest  rate  per the  debt  agreement  is six  month  PRIBOR  (Prague
        Interbank  Offered  Rate) plus  0.475%.  However,  under the terms of an
        interest rate swap,  which extends until June 2002, UE pays a fixed rate
        of 8.31% and receives a floating rate of six month PRIBOR.









ITEM 2.  ACQUISITIONS OR SALES OF UTILITY ASSETS
- -------  ---------------------------------------

         None during fiscal year ended September 30, 2000.

ITEM 3.  ISSUE, SALE, PLEDGE, GUARANTEE OR ASSUMPTION OF SYSTEM SECURITIES
- ------   -----------------------------------------------------------------

1.   Name of Issuer:  Horizon Energy Development, Inc.
     Description of Security:  Line of Credit Agreement with maximum draw of
                               $40,000,000
     Effective Average Interest Rate:  6.32%
     Name of Person To Whom Issued:  National Fuel Gas Company
     End of Year Balance:  $8,700,000
     Highest Balance During Year:  $32,400,000
     Exemption:  Rule 52

2.   Name of Issuer:  United Energy, a.s., as successor to Prvni severozapadni
                      teplarenska, a.s. (PSZT)
     Description of Security:  Line of Credit Agreement with maximum draw of
                               $40,000,000
     Effective Average Interest Rate:  6 month LIBOR plus 2%
     Name of Person To Whom Issued:  Horizon Energy Development, Inc.
     End of Year Balance:  $0
     Highest Balance During Year:  $22,100,000
     Exemption:  Rule 52

3.   Name of Issuer:  NFR Power, Inc.
     Description of Security:  Line of Credit Agreement with maximum draw of
                               $1,000,000
     Effective Average Interest Rate:  6.245%
     Name of Person To Whom Issued:  National Fuel Resources, Inc.
     End of Year Balance:  $0
     Highest Balance During Year:  $548,833
     Exemption:  Rule 52

4.   Name of Issuer:  National Fuel Exploration Corp.
     Description of Security:  Line of Credit Agreement with maximum draw of
                               $160,000,000
     Effective Average Interest Rate:  6.7%
     Name of Person To Whom Issued:  Seneca Resources Corporation
     End of Year Balance:  $153,086,698
     Highest Balance During Year:  $153,086,698
     Exemption:  Rule 52






ITEM 4.  ACQUISITION, REDEMPTION OR RETIREMENT OF SYSTEM SECURITIES
- -------  ----------------------------------------------------------
         FISCAL YEAR ENDED SEPTEMBER 30, 2000
         ------------------------------------



                                       Name of
                                       Company
                                      Acquiring,        Number of Shares or
                                      Redeeming           Principal Amount
                                     or Retiring    ----------------------------                 Commission
Name of Issuer and Title of Issue     Securities    Acquired  Redeemed   Retired Consideration  Authorization
- ---------------------------------     ----------    --------  --------   ------- -------------  -------------
                                                              (Thousands of Dollars)
                                                    ------------------------------------------
Registered Holding Company:
- --------------------------

    Registrant:
     6.60% Note due
      February 4, 2000                   Registrant                       50,000     50,000     Rule 42

     7.30% Note due
      February 18, 2003                  Registrant   150,000                                   File No. 70-9153


Subsidiaries of Registered Holding Company:
- ------------------------------------------

    Seneca Resources:
     7.48% Note maturing                 Seneca
      February 18, 2003                  Resources    100,000                       100,000     File No. 70-9153

    Distribution Corporation
     7.48% Note maturing                 Distribution
      February 18, 2003                  Corporation   50,000                        50,000     File No. 70-9153

    Distribution Corporation:
     6.71% Note due                      Distribution
      February 4, 2000                   Corporation                      50,000     50,000     Rule 42






ITEM 5.  INVESTMENTS IN SECURITIES OF NONSYSTEM COMPANIES
- -------  ------------------------------------------------

                            Number of                              Aggregate
1. Name of Owner             Persons      Business of Persons      Investment
   -------------            ---------     -------------------      ----------

None.






ITEM 6.  OFFICERS AND DIRECTORS
- -------  ----------------------

Part I.  Names, principal business address and positions held as of September 30, 2000

                                        Names of System Companies with Which Connected
                                        ---------------------------------------------------------------------





                                                             National       National               Highland
                                                             Fuel Gas       Fuel Gas     Seneca     Forest
                                                           Distribution      Supply     Resources  Resources
                                           Registrant          Corp.          Corp.       Corp.*     Inc.
                                       ----------------------------------------------------------------------
B. J. Kennedy          Buffalo, NY (1) | D, COB, CEO, s |      D, COB, s |  D, COB, s | D, COB, s |       s |
- -------------------------------------------------------------------------------------------------------------
B. S. Lee          Des Plaines, IL (2) |          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
G. L. Mazanec          Houston, TX (3) |          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. F. Riordan      Des Plaines, IL (24)|          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
E. T. Mann             Buffalo, NY (1) |          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
R. T. Brady            Buffalo, NY (4) |          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
W. J. Hill             Buffalo, NY (1) |          D, df |              D |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. V. Glynn      Niagara Falls, NY (14)|          D, df |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
P. C. Ackerman         Buffalo, NY (1) |        D, P, s |           D, s |     EVP, s |      D, s |    D, s |
- -------------------------------------------------------------------------------------------------------------
J. R. Peterson         Buffalo, NY (1) |          AS, s |              - |      GC, s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. A. Beck             Houston, TX (5) |              - |              - |          - |   D, P, s |    P, D |
- -------------------------------------------------------------------------------------------------------------
W. M. Petmecky         Houston, TX (5) |              - |              - |          - | SVP, S, s |       S |
- -------------------------------------------------------------------------------------------------------------
D. A. Brown            Houston, TX (5) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
G. E. Klefstad         Houston, TX (5) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
E. E. Wassell          Houston, TX (5) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
J. F. McKnight         Houston, TX (5) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
C. H. Friedrich        Houston, TX (5) |              - |              - |          - |  T, AS, s |       T |
- -------------------------------------------------------------------------------------------------------------
B. L. McMahon      Santa Paula, CA (6) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
A. M. Cellino          Buffalo, NY (1) |           S, s |       VP, S, s |          s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
P. M. Ciprich          Buffalo, NY (1) |              - |      AS, GC, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
W. E. DeForest         Buffalo, NY (1) |              - |      SVP, D, s |          s |         s |       - |
- -------------------------------------------------------------------------------------------------------------
B. H. Hale             Buffalo, NY (1) |              - |              - |  D, SVP, s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
R. J. Kreppel    Williamsville, NY (17)|              - |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. P. Pawlowski        Buffalo, NY (1) |           T, s |   D, SVP, T, s |    T, S, s |         s |       s |
- -------------------------------------------------------------------------------------------------------------
J. R. Pustulka         Buffalo, NY (1) |              - |              s |      VP, s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. D. Ramsdell         Buffalo, NY (1) |              - |          VP, s |          s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
W. A. Ross             Buffalo, NY (1) |              - |              - |   D, VP, s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
D. J. Seeley           Buffalo, NY (1) |              - |      SVP, D, s |    P, D, s |         - |       - |
- -------------------------------------------------------------------------------------------------------------
D. F. Smith            Buffalo, NY (1) |              - |        P, D, s |          s |         D |       - |
- -------------------------------------------------------------------------------------------------------------
R. J. Tanski           Buffalo, NY (1) |              - |       VP, C, s |          s |         s |       s |
- -------------------------------------------------------------------------------------------------------------
G. T. Wehrlin          Buffalo, NY (1) |           C, s |      SVP, D, s |          s |      C, s |       s |
- -------------------------------------------------------------------------------------------------------------
R. W. Wilcox           Buffalo, NY (1) |              - |          VP, s |          s |         s |       s |
- -------------------------------------------------------------------------------------------------------------
C. M. Carlotti            Erie, PA (21)|              - |          VP, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
R. T. Evans            Houston, TX (5) |              - |              - |          - |     VP, s |       - |
- -------------------------------------------------------------------------------------------------------------
T. L. Atkins           Houston, TX (5) |              - |              - |          - |     AC, s |       - |
- -------------------------------------------------------------------------------------------------------------
D. L. DeCarolis        Buffalo, NY (1) |              - |         AVP, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. F. Kronenwetter     Buffalo, NY (1) |              - |         AVP, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
R. E. Klein            Buffalo, NY (1) |              - |          AC, s |          s |         s |       s |
- -------------------------------------------------------------------------------------------------------------
S. Wagner              Buffalo, NY (1) |              - |          AT, s |          s |         s |       s |
- -------------------------------------------------------------------------------------------------------------
B. Heine               Buffalo, NY (1) |              - |         AVP, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
J. Lesch               Buffalo, NY (25)|              - |         AVP, s |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------
D. Wassum              Buffalo, NY (1) |              - |              - |          - |         - |       - |
- -------------------------------------------------------------------------------------------------------------


                                      Position Symbol Key
              ------------------------------------------------------------------------
              COB - Chairman of the Board of Directors   S - Secretary
              CEO - Chief Executive Officer             AS - Assistant Secretary
                P - President                            C - Controller
              EVP - Executive Vice President            AC - Assistant Controller
              SVP - Senior Vice President                D - Director
               VP - Vice President                       s - Salary
              AVP - Assistant Vice President             T - Treasurer
               GC - General Counsel                     AT - Assistant Treasurer
               df - Director's Fees

See page 15 for Notes.















  Data-
  Track      National     Horizon                             Niagara     Seneca
  Account      Fuel       Energy                  Upstate      Indep.     Indep.       NFR
 Services,  Resources,  Development,  Leidy Hub,   Energy    Marketing   Pipeline     Power
   Inc.        Inc.        Inc.**        Inc.       Inc.       Co.***       Co.        Inc.
- ----------------------------------------------------------------------------------------------
        s |         s |           s |         D |        - |     D, COB |    D, COB |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
     D, P |         - |     P, D, s |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |     P, D |       D, P |         - |      - |
- ----------------------------------------------------------------------------------------------
     S, T |      S, T |           - |         - |     D, S |          S |         - |   S, T |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        T |          T |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         s |           - |   D, P, s |        - |          - |   P, S, T |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |       VP, s |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
       VP |   D, P, s |           - |         - |        - |          - |         - |   D, P |
- ----------------------------------------------------------------------------------------------
        - |         s |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          D |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        D |         D |           - |         - |        - |          - |         - |      D |
- ----------------------------------------------------------------------------------------------
        - |         s |     T, S, s |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        D |      D, s |       VP, s |D, S, T, s |        - |          - |         - |      D |
- ----------------------------------------------------------------------------------------------
        - |         s |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         s |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         s |           s |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |           - |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------
        - |         - |      AVP, s |         - |        - |          - |         - |      - |
- ----------------------------------------------------------------------------------------------






 * Officers and directors of Seneca's sole subsidiary are as follows:

National Fuel Exploration Corp.
- -------------------------------
Board of Directors and Officers:
 B. J. Kennedy (Director and Chairman)                        Buffalo, NY (1)
 J. B. McCashin (President)                                   Calgary, Alberta (26)
 D. Conrad (Secretary)                                        Calgary, Alberta (26)
 W. M. Petmecky (Assistant Secretary)                         Houston, TX (5)
 G. W. Burns (Director)                                       Calgary, Alberta (26)
 D. R. Goruk (Director)                                       Calgary, Alberta (26)

** Officers and directors of Horizon's subsidiaries are as follows:

Horizon Energy Holdings, Inc.
- -----------------------------
Board of Directors and Officers:
 P. C. Ackerman (Director and President)                      Buffalo, NY (1)
 B. H. Hale (Vice President)                                  Buffalo, NY (1)
 G. T. Wehrlin (Vice President)                               Buffalo, NY (1)
 R. J. Tanski (Secretary and Treasurer)                       Buffalo, NY (1)

Horizon Energy Development, B.V.
- --------------------------------
Managing Directors:
 B. H. Hale                                                   Buffalo, NY (1)
 G. T. Wehrlin                                                Buffalo, NY (1)
 Intra Beheer B.V.                                            Amsterdam, The Netherlands (8)

Horizon Energy Development, s.r.o.
- ----------------------------------
Managing Director:
 B. H. Hale                                                   Buffalo, NY (1)
Statutory Agents:
 Lubos Jarolimek                                              Prague, Czech Republic (7)
 Ales Novak                                                   Prague, Czech Republic (7)

Power Development, s.r.o.
- -------------------------
Managing Director:
 B. H. Hale                                                   Buffalo, NY (1)

Teplarna Kromeriz, a.s.
- -----------------------
Board of Directors:
 Lubos Jarolimek                                              Prague, Czech Republic (7)
 Jan Masinda                                                  Prague, Czech Republic (7)
 Jiri Hudecek                                                 Kromeriz, Czech Republic (22)

Teplarna Liberec, a.s.
- ----------------------
Board of Directors:
 Jiri Drda                                                    Liberec, Czech Republic (15)
 Lubos Jarolimek                                              Prague, Czech Republic (7)
 Jiri Jezek                                                   Liberec, Czech Republic (15)
 Zdenek Kozesnik                                              Liberec, Czech Republic (15)
 Jan Masinda                                                  Prague, Czech Republic (7)
 Josef Vanzura                                                Most, Czech Republic (19)

SCT SoftMaker, s.r.o.
- ---------------------
Executive:
 Zdenek Tapsik                                                Most, Czech Republic (16)

Lounske tepelne hospodarstvi, s.r.o.
- ------------------------------------
Statutory Agents:
 R. Jiruska                                                   Louny, Czech Republic (23)

Teplo Branany, s.r.o.
- ---------------------
Managing Directors:
 R. Jiruska                                                   Branany, Czech Republic (20)
 V. Krupka                                                    Branany, Czech Republic (20)

Jablonecka teplarenska a realitni, a.s.
- ---------------------------------------
Board of Directors:
 J. Cerovsky                                                  Jablonec, Czech Republic (18)
 Josef Vanzura                                                Most, Czech Republic (19)
 Lubos Jarolimek                                              Prague, Czech Republic (7)
 J. Drabek                                                    Jablonec, Czech Republic (18)
 Zdenek Kozesnik                                              Liberec, Czech Republic (15)
 Ales Novak                                                   Prague, Czech Republic (7)
 Jan Nechvatal                                                Most, Czech Republic (19)
 P. Voboril                                                   Jablonec, Czech Republic (18)

See page 15 for Notes






United Energy, a.s.
- -------------------
Board of Directors:
 Lubos Jarolimek                                              Prague, Czech Republic (7)
 L. Zapletal                                                  Most, Czech Republic (19)
 B. H. Hale                                                   Buffalo, NY (1)
 G. T. Wehrlin                                                Buffalo, NY (1)
 P. C. Ackerman                                               Buffalo, NY (1)
 B. J. Kennedy                                                Buffalo, NY (1)
 R. J. Tanski                                                 Buffalo, NY (1)
 Jiri Sulc                                                    Most, Czech Republic (19)
 E. Volkman                                                   Most, Czech Republic (19)
 Josef Vanzura                                                Most, Czech Republic (19)

ENOP Company, s.r.o.
- --------------------
Statutory Agents:
 Roman Kocar                                                  Most, Czech Republic (19)
 K. Stejskal                                                  Most, Czech Republic (19)
 J. Stepanek                                                  Most, Czech Republic (19)

*** NIM's sole subsidiary is the following general partnership:

DirectLink Gas Marketing Company
- --------------------------------
Management Committee Members:
 D. A. Rowekamp                                               Buffalo, NY (1)
 J. A. Brett                                                  MIDCON (11)
 C. Smith                                                     ANR (12)
 D. Jones                                                     Williams (13)

Notes
 (1) National Fuel Gas Company, 10 Lafayette Square, Buffalo, New York 14203
 (2) Institute  of Gas  Technology,  1700 So.  Mt.  Prospect  Road,  DesPlaines,  IL 60018-1804
 (3) Duke Energy  Corporation,  P.O. Box 1642, Houston, TX 77251-1642
 (4) Moog Inc.,  Plant 24/Seneca at Jamison Rd., East Aurora,  NY 14052-0018
 (5) Seneca Resources Corporation,  1201 Louisiana Street, Suite 400, Houston, Texas 77002
 (6)  Seneca  Resources  Corporation,  P.O.  Box  630,  Santa  Paula,  CA 93061-0630
 (7) Horizon  Energy  Development,  s.r.o.,  Maiselova 15, Praha 1 - Josefov,  11000, Czech Republic
 (8) Intra Beheer B.V., Leidseplein 29, 1017 PS, Amsterdam,  The Netherlands
 (9) NGC Corporation,  1000 Louisiana Street,  Suite 5800, Houston, TX 77002-5050
(10)  NICOR, Inc., 1844 Ferry Road, Naperville, IL 60563-9600
(11)  MGS Marketing Corp., 3200 Southwest Freeway, Houston, TX 77027
(12)  Coastal Gas Marketing DirectLink Corp., 9 Greenway Plaza, 22nd Floor, Houston, TX 77046
(13)  Williams Independence Marketing Company, One Williams Center, Tulsa, Oklahoma 74172
(14)  Maid of the Mist Corporation, 151 Buffalo Avenue, Niagara Falls, New York 14303
(15)  Teplarna Liberec, a.s., Dr. Milady Horakove 641/34a, 460 01 Liberec 4, Czech Republic
(16)  SCT SoftMaker, s.r.o., Seifertova 2179, 434 00 Most, Czech Republic
(17)  National Fuel Resources, Inc., 165 Lawrence Bell Drive, Williamsville, NY 14221
(18)  Jablonecka teplarenska a realitni, a.s., Liberecka 104 Jablonec nad Nisou, Czech Republic
(19)  United Energy, a.s., Komorany, 434 03 Most 3, Czech Republic
(20)  Teplo Branany, s.r.o., Bilinska 76 Branany, Czech Republic
(21)  National Fuel Gas Company, 1100 State Street, Erie, PA 16501
(22)  Teplarna Kromeriz, Na sadkach 3572, Kromeriz, Czech Republic
(23)  Lounske tepelne hospodarstvi, s.r.o., ul. Benese z Loun cp. 185, Louny
(24)  Gas Technology Institute, 1700 So. Mt. Prospect Road, Des Plaines, IL  60018-1804
(25)  National Fuel Gas Distribution Corporation, 365 Mineral Springs Road, Building 3, Buffalo, NY 14210
(26)  National Fuel Exploration Corp., 1000, 550-6th Avenue, S.W., Calgary, Alberta T2P 0S2







Item 6.  OFFICERS AND DIRECTORS (Continued)
- -------  ----------------------------------

Part II.  Financial connections as of September 30, 2000:

                                                 Position Held     Applicable
Name of Officer        Name and Location of      in Financial      Exemption
  or Director          Financial Institution      Institution         Rule
- ---------------        ---------------------     -------------     -------------

R. T. Brady           Manufacturers and Traders
                       Trust Company,
                       Buffalo, New York           Director          70 (a)
                      M&T Bank Corporation,
                       Buffalo, New York           Director          70 (a)

B. J. Kennedy         HSBC USA, Inc.
                       Buffalo, New York           Director          70 (a)

G. L. Mazanec         Northern Trust Bank
                       of Texas,
                       Dallas, Texas               Director          70 (a)

J. V. Glynn           M&T Bank Corporation
                       Buffalo, New York           Director          70 (a)
                      M&T Bank,
                       Buffalo, New York           Director          70 (a)

Part III.  Compensation and other related information:

(a) Compensation of Directors and Executive Officers:

         The  information  required  by  this  item  appears  under  "Directors'
Compensation," and "Executive Compensation," on pages 6 to 7, and pages 9 to 16,
respectively,  of the National Fuel Gas Company Proxy  Statement,  dated January
29, 2001,  included as Exhibit A (3) to this Form U5S and is incorporated herein
by reference.

(b) Interest  of  executive  officers  and  directors  in  securities  of System
    Companies including options or other rights to acquire securities:

         The information required by this item appears under "Security Ownership
of Certain  Beneficial  Owners and Management," on pages 8 and 9 of the National
Fuel Gas Company Proxy  Statement,  dated January 29, 2001,  included as Exhibit
A(3) of this Form U5S and is incorporated herein by reference.

(c)  Contracts and Transactions with System Companies:

         The  following  contracts  and  transactions  with  the  directors  and
executive  officers of National  Fuel Gas Company were  disclosed in the company
Form 10-K fiscal year 2000.

o             Employment  Agreement,  dated  September 17, 1981, with Bernard J.
              Kennedy  (Exhibit 10.4,  Form 10-K for fiscal year ended September
              30, 1994 in File No. 1-3880)

o             Tenth  Amendment to Employment  Agreement with Bernard J. Kennedy,
              effective  September 1, 1999 (Exhibit  10.1,  Form 10-K for fiscal
              year ended September 30, 1999 in File No. 1-3880)

o             Agreement dated August 1, 1986, with Joseph P. Pawlowski  (Exhibit
              10.1,  Form 10-K for fiscal year ended  September  30,1997 in File
              No. 1-3880)





Item 6. OFFICERS AND DIRECTORS (Continued)
- ------  ----------------------------------


o             Agreement  dated August 1, 1986,  with Gerald T. Wehrlin  (Exhibit
              10.2,  Form 10-K for fiscal year ended September 30, 1997, in File
              No. 1-3880)

o             Form of Employment  Continuation  and  Noncompetition  Agreements,
              dated as of December 11, 1998, with Philip C. Ackerman,  Walter E.
              DeForest,  Joseph P. Pawlowski,  Dennis J. Seeley,  David F. Smith
              and Gerald T. Wehrlin  (Exhibit 10.1,  Form 10-Q for the quarterly
              period ended June 30, 1999 in File No. 1-3880)

o             Form of  Employment  Continuation  and  Noncompetition  Agreement,
              dated as of December 11, 1998,  with James A. Beck (Exhibit  10.3,
              Form 10-Q for the quarterly period ended June 30, 1999 in File No.
              1-3880)

o             National  Fuel Gas Company 1983  Incentive  Stock Option Plan,  as
              amended and restated through February 18, 1993 (Exhibit 10.2, Form
              10-Q for the  quarterly  period  ended  March 31, 1993 in File No.
              1-3880)

o             National Fuel Gas Company 1984 Stock Plan, as amended and restated
              through  February  18,  1993  (Exhibit  10.3,  Form  10-Q  for the
              quarterly period ended March 31, 1993 in File No. 1-3880)

o             Amendment to the National Fuel Gas Company 1984 Stock Plan,  dated
              December 11, 1996 (Exhibit  10.7,  Form 10-K for fiscal year ended
              September 30, 1996 in File No. 1-3880)

o             National  Fuel Gas  Company  1993  Award and  Option  Plan,  dated
              February  18,  1993  (Exhibit  10.1,  Form 10-Q for the  quarterly
              period ended March 31, 1993 in File No. 1-3880)

o             Amendment to National Fuel Gas Company 1993 Award and Option Plan,
              dated  October 27, 1995 (Exhibit  10.8,  Form 10-K for fiscal year
              ended September 30, 1995 in File No. 1-3880)

o             Amendment to National Fuel Gas Company 1993 Award and Option Plan,
              dated December 11, 1996 (Exhibit  10.8,  Form 10-K for fiscal year
              ended September 30, 1996 in File No. 1-3880)

o             Amendment to National Fuel Gas Company 1993 Award and Option Plan,
              dated  December 18, 1996  (Exhibit 10, Form 10-Q for the quarterly
              period ended December 31, 1996 in File No. 1-3880)

o             Amended and  Restated  National  Fuel Gas  Company  1997 Award and
              Option  Plan,  as amended and restated  through  February 17, 2000
              (Exhibit 10.1, Form 10-Q for the quarterly  period ended March 31,
              2000 in File No. 1-3880)

o             National Fuel Gas Company Deferred  Compensation  Plan, as amended
              and  restated  through May 1, 1994  (Exhibit  10.7,  Form 10-K for
              fiscal year ended September 30, 1994 in File No. 1-3880)

o             Amendment to the National Fuel Gas Company  Deferred  Compensation
              Plan,  dated  September  19, 1996  (Exhibit  10.10,  Form 10-K for
              fiscal year ended September 30, 1996 in File No. 1-3880)





Item 6. OFFICERS AND DIRECTORS (Continued)
- ------  ----------------------------------


o             Amendment to the National Fuel Gas Company  Deferred  Compensation
              Plan, dated September 27, 1995 (Exhibit 10.9, Form 10-K for fiscal
              year ended September 30, 1995 in File No. 1-3880)

o             National Fuel Gas Company Deferred  Compensation  Plan, as amended
              and restated  through March 20, 1997 (Exhibit 10.3,  Form 10-K for
              fiscal year ended September 30, 1997 in File No. 1-3880)

o             Amendment to National Fuel Gas Company Deferred  Compensation Plan
              dated June 16, 1997 (Exhibit 10.4, Form 10-K for fiscal year ended
              September 30, 1997 in File No. 1-3880)

o             Amendment  No.  2  to  the  National  Fuel  Gas  Company  Deferred
              Compensation  Plan,  dated March 13, 1998 (Exhibit 10.1, Form 10-K
              for fiscal year ended September 30, 1998 in File No. 1-3880)

o             Amendment to the National Fuel Gas Company  Deferred  Compensation
              Plan,  dated  February 18, 1999 (Exhibit  10.1,  Form 10-Q for the
              quarterly period ended March 31, 1999 in File No. 1-3880)

o             National Fuel Gas Company  Tophat Plan,  effective  March 20, 1997
              (Exhibit  10, Form 10-Q for the  quarterly  period  ended June 30,
              1997 in File No. 1-3880)

o             Amendment  No. 1 to the  National  Fuel Gas Company  Tophat  Plan,
              dated April 6, 1998 (Exhibit 10.2, Form 10-K for fiscal year ended
              September 30, 1998 in File No. 1-3880)

o             Amendment  No. 2 to the  National  Fuel Gas Company  Tophat  Plan,
              dated December 10, 1998 (Exhibit 10.1, Form 10-Q for the quarterly
              period ended December 31, 1998 in File No. 1-3880)

o             Death Benefits  Agreement,  dated August 28, 1991, with Bernard J.
              Kennedy (Exhibit 10-TT,  Form 10-K for fiscal year ended September
              30, 1991 in File No. 1-3880)

o             Amendment to Death  Benefit  Agreement  of August 28,  1991,  with
              Bernard J. Kennedy, dated March 15, 1994 (Exhibit 10.11, Form 10-K
              for fiscal year ended September 30, 1995 in File No. 1-3880)

o             Amended and Restated Split Dollar Insurance  Agreement,  effective
              June 15, 2000 among National Fuel Gas Company, Bernard J. Kennedy,
              and Joseph B. Kennedy, as Trustee of the Trust under the Agreement
              dated January 9, 1998 (Exhibit  10.1,  Form 10-Q for the quarterly
              period ended June 30, 2000 in File No. 1-3880)

o             Contingent  Benefit  Agreement  effective  June 15,  2000  between
              National  Fuel Gas Company and Bernard J. Kennedy  (Exhibit  10.2,
              Form 10-Q for the quarterly period ended June 30, 2000 in File No.
              1-3880)

o             Amended and Restated  Split  Dollar  Insurance  and Death  Benefit
              Agreement  dated  September  17,  1997  with  Philip  C.  Ackerman
              (Exhibit 10.5,  Form 10-K for fiscal year ended September 30, 1997
              in File No. 1-3880)

o             Amendment  Number 1 to Amended and Restated Split Dollar Insurance
              and Death  Benefit  Agreement  by and  Between  National  Fuel Gas
              Company and Philip C.  Ackerman,  dated  March 23,  1999  (Exhibit
              10.3,  Form 10-K for fiscal year ended  September 30, 1999 in File
              No. 1-3880)





Item 6. OFFICERS AND DIRECTORS (Continued)
- ------  ----------------------------------


o             Amended and Restated  Split  Dollar  Insurance  and Death  Benefit
              Agreement  dated  September  15,  1997 with  Joseph  P.  Pawlowski
              (Exhibit 10.7,  Form 10-K for fiscal year ended September 30, 1997
              in File No. 1-3880)

o             Amendment  Number 1 to Amended and Restated Split Dollar Insurance
              and Death  Benefit  Agreement  by and  Between  National  Fuel Gas
              Company and Joseph P.  Pawlowski,  dated  March 23, 1999  (Exhibit
              10.5,  Form 10-K for fiscal year ended  September 30, 1999 in File
              No. 1-3880)

o             Second Amended and Restated Split Dollar Insurance Agreement dated
              June 15, 1999 with Gerald T. Wehrlin  (Exhibit 10.6, Form 10-K for
              fiscal year ended September 30, 1999 in File No. 1-3880)

o             Amended and Restated  Split  Dollar  Insurance  and Death  Benefit
              Agreement  dated  September  15,  1997  with  Walter  E.  DeForest
              (Exhibit 10.7,  Form 10-K for fiscal year ended September 30, 1999
              in File No. 1-3880)

o             Amendment  Number 1 to Amended and Restated Split Dollar Insurance
              and Death  Benefit  Agreement  by and  Between  National  Fuel Gas
              Company and Walter E.  DeForest,  dated  March 29,  1999  (Exhibit
              10.8,  Form 10-K for fiscal year ended  September 30, 1999 in File
              No. 1-3880)

o             Amended and Restated  Split  Dollar  Insurance  and Death  Benefit
              Agreement  dated September 15, 1997 with Dennis J. Seeley (Exhibit
              10.9,  Form 10-K for fiscal year ended  September 30, 1999 in File
              No. 1-3880)

o             Amendment  Number 1 to Amended and Restated Split Dollar Insurance
              and Death  Benefit  Agreement  by and  Between  National  Fuel Gas
              Company and Dennis J. Seeley, dated March 29, 1999 (Exhibit 10.10,
              Form 10-K for fiscal  year ended  September  30,  1999 in File No.
              1-3880)

o             Split Dollar Insurance and Death Benefit Agreement dated September
              15, 1997 with Bruce H. Hale (Exhibit  10.11,  Form 10-K for fiscal
              year ended September 30, 1999 in File No. 1-3880)

o             Amendment  Number 1 to Split Dollar  Insurance  and Death  Benefit
              Agreement  by and Between  National  Fuel Gas Company and Bruce H.
              Hale,  dated March 29, 1999 (Exhibit  10.12,  Form 10-K for fiscal
              year ended September 30, 1999 in File No. 1-3880)

o             Split Dollar Insurance and Death Benefit Agreement dated September
              15, 1997 with David F. Smith (Exhibit 10.13,  Form 10-K for fiscal
              year ended September 30, 1999 in File No. 1-3880)

o             Amendment  Number 1 to Split Dollar  Insurance  and Death  Benefit
              Agreement  by and Between  National  Fuel Gas Company and David F.
              Smith,  dated March 29, 1999 (Exhibit 10.14,  Form 10-K for fiscal
              year ended September 30, 1999 in File No. 1-3880)

o             National Fuel Gas Company and Participating Subsidiaries Executive
              Retirement Plan as amended and restated  through  November 1, 1995
              (Exhibit 10.10, Form 10-K for fiscal year ended September 30, 1995
              in File No. 1-3880)

o             National  Fuel Gas Company  and  Participating  Subsidiaries  1996
              Executive  Retirement Plan Trust Agreement (II) dated May 10, 1996
              (Exhibit 10.13, Form 10-K for fiscal year ended September 30, 1996
              in File No. 1-3880)





Item 6. OFFICERS AND DIRECTORS (Concluded)
- ------  ----------------------------------


o             Amendments  to  National   Fuel  Gas  Company  and   Participating
              Subsidiaries  Executive  Retirement  Plan dated September 18, 1997
              (Exhibit 10.9,  Form 10-K for fiscal year ended September 30, 1997
              in File No. 1-3880)

o             Amendments  to the  National  Fuel Gas Company  and  Participating
              Subsidiaries  Executive  Retirement  Plan dated  December 10, 1998
              (Exhibit 10.2,  Form 10-Q for the quarterly  period ended December
              31, 1998 in File No. 1-3880)

o             Amendments  to  National   Fuel  Gas  Company  and   Participating
              Subsidiaries  Executive  Retirement  Plan effective  September 16,
              1999 (Exhibit 10.15, Form 10-K for fiscal year ended September 30,
              1999 in File No. 1-3880)

o             Administrative Rules with Respect to at Risk Awards under the 1993
              Award and Option Plan  (Exhibit  10.14,  Form 10-K for fiscal year
              ended September 30, 1996 in File No. 1-3880)

o             Administrative Rules with Respect to at Risk Awards under the 1997
              Award and Option Plan  (Exhibit  A,  Definitive  Proxy  Statement,
              Schedule 14(A) filed January 14, 2000 in File No. 1-3880)

o             Administrative Rules of the Compensation Committee of the Board of
              Directors of National  Fuel Gas Company,  as amended and restated,
              effective  December  10,  1998  (Exhibit  10.3,  Form 10-Q for the
              quarterly period ended December 31, 1998 in File No. 1-3880)

o             Excerpts of Minutes  from the National  Fuel Gas Company  Board of
              Directors  Meeting of February 20, 1997  regarding the  Retirement
              Benefits  for Bernard J.  Kennedy  (Exhibit  10.10,  Form 10-K for
              fiscal year ended September 30, 1997 in File No. 1-3880)

o             Excerpts of Minutes  from the National  Fuel Gas Company  Board of
              Directors  Meeting of March 20, 1997 regarding the Retainer Policy
              for Non-Employee  Directors  (Exhibit 10.11,  Form 10-K for fiscal
              year ended September 30, 1997 in File No. 1-3880)

(d)    Indebtedness to System Companies:  None

(e)    Participation in Bonus and Profit-Sharing Arrangements and Other Benefits:

        The  information   required  by  this  item  appears  under  "Directors'
        Compensation," and "Executive Compensation," on pages 6 to 7 and pages 9
        to 16,  respectively,  of the National Fuel Gas Company Proxy Statement,
        dated  January 29,  2001,  included as Exhibit A(3) to this Form U5S and
        incorporated herein by reference.

Part III.  Compensation of Directors and Executive Officers (Concluded)

(f)    Rights to Indemnity:

       The information  required by this item appears in Article II, Paragraph 8
       of the  National  Fuel Gas Company  By-Laws as amended  through  June 15,
       2000.  Such  By-Laws are listed as Exhibit  B(1)(ii) to this Form U5S and
       are incorporated herein by reference as indicated.

       The Company also  purchases  directors and officers  liability  insurance
       coverage  with an  annual  aggregate  limit  of  $135  million,  and,  in
       recognition of the scope of the foregoing by-law indemnification, certain
       other errors and  omissions  and general  liability  insurance  coverages
       which are  applicable to all employees as insureds,  including  directors
       and officers.






ITEM 7.  CONTRIBUTIONS AND PUBLIC RELATIONS
- -------  ----------------------------------


                                                                                               Amount
                            Name of Recipient               Accounts Charged Per Books   Fiscal Year Ended
    Name of Company          or Beneficiary       Purpose     of Disbursing Company      September 30, 2000
    ---------------         -----------------     -------   --------------------------   ------------------

Tabulation showing expenditures,  disbursements, or payments during the year, in
money, goods or services, directly or indirectly to or for the account of:

(1) Any political  party,  candidate for public office or holder of such office,
    or any committee or agent therefor:

Distribution Corporation           N/A            *FEDPAC    Misc. Income Deductions        $  5,628

Distribution Corporation           N/A            *NYPAC     Misc. Income Deductions        $  5,504

Distribution Corporation           N/A            *PAPAC     Misc. Income Deductions        $  3,686

Supply Corporation                 N/A            *FEDPAC    Misc. Income Deductions        $  4,254

Supply Corporation                 N/A            *NYPAC     Misc. Income Deductions        $  1,682

Supply Corporation                 N/A            *PAPAC     Misc. Income Deductions        $  1,581

* Company  labor and expenses  relating to  administration  of political  action
funds.

(2) Any citizens group or public relations counsel:

Distribution Corporation    Buffalo-Niagara
                            Enterprise             Civic     Operation Expense              $125,035

Distribution Corporation    32 Beneficiaries       Civic     Operation Expense              $ 15,947

Supply Corporation          Buffalo-Niagara
                            Enterprise             Civic     Operation Expense              $125,035

Supply Corporation          20 Beneficiaries       Civic     Operation Expense              $  8,798

Seneca Resources             2 Beneficiaries       Civic     Operation Expense              $    975

The  information  called  for  by  instruction  2 to  Item 7 was  compiled,  and
memoranda from the applicable  System  Companies were received and are preserved
by the Registrant.






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS
- -------  -----------------------------------------

Part I.  Intercompany sales and services

    (1)    Salaries of officers of the Registrant


                                                           NATIONAL FUEL GAS COMPANY
                                                           -------------------------
                                                          REPORT OF OFFICERS' SALARIES
                                                          ----------------------------
                                                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                  --------------------------------------------

                          Distribution   Supply    Seneca     Leidy                       Data-
                  Parent     Corp.       Corp.    Resources    Hub    Highland  Horizon   Track   NFR     Total
                  ------  ------------   ------   ---------   -----   --------  -------   -----   ---     -----


B. J. Kennedy    $72,093  $296,854      $449,520   $10,602    $   -   $2,120    $ 8,481  $4,240  $4,240  $848,150

P. C. Ackerman    48,450   199,500       199,500    82,650        -    5,700     34,200       -       -   570,000

A. M. Cellino      8,437   106,887        53,426         -        -        -          -       -       -   168,750

J. P. Pawlowski   12,400   149,229        69,832    14,984        -    1,390          -       -     165   248,000

G. T. Wehrlin     12,325    34,349        16,074     3,449    7,395      320    172,550       -      38   246,500







ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I. Intercompany sales and services (Continued)

(2)   Services rendered by Statutory Subsidiaries

                                                       DISTRIBUTION CORPORATION
                                                       ------------------------
                                               REPORT OF INTERCOMPANY SALES AND SERVICES
                                               -----------------------------------------
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                             --------------------------------------------
                                                        (THOUSANDS OF DOLLARS)
                                                        ----------------------

                                                            Common Expenses
                            --------------------------------------------------------------------------

                                                      Corporate     Materials                Accounts
Receiving Company           Executive   Purchasing  Communications  Management  Accounting   Payable
- -----------------           ---------   ----------  --------------  ----------  ----------   -------
Supply Corporation            $529        $234           $160          $23       $1,063       $177
Seneca Resources               399           -              8            -          225          -
UCI                              -           -              -            -            -          -
Highland                        49           -              1            -           21          -
Data-Track                       -           -              -            -            -          -
NFR                              6           -              -            -            2          -
Leidy Hub                        -           -              -            -            -          -
Horizon                          -           -              -            -            -          -
Parent Company                   -           -              -            -            -          -
NIM                              -           -              -            -            -          -
Upstate Energy                   -           -              -            -            -          -
                              ----        ----           ----          ---       ------       ----
                              $983        $234           $169          $23       $1,311       $177
                              ====        ====           ====          ===       ======       ====

                                                            Common Expenses
                            --------------------------------------------------------------------------------------
                              Data           Human                             Government      Benefit
Receiving Company           Processing     Resources     Legal     Finance       Affair        Services     CPR
- -----------------           ----------     ---------     -----     -------     ----------      --------     ---
Supply Corporation             $229          $398        $ 43       $606          $78            $184      $230
Seneca Resources                  -            34          33         98            -             151         -
UCI                               -             -           -          -            -               -         -
Highland                          -             4           4          9            -              19         -
Data-Track                        -             -           -          -            -               -         -
NFR                               -             1           1          1            -               2         -
Leidy Hub                         -             -           -          -            -               -         -
Horizon                           -             -           -          -            -               -         -
Parent Company                    -             -           -          -            -               -         -
NIM                               -             -           -          -            -               -         -
Upstate Energy                    -             -           -          -            -               -         -
                               ----          ----        ----       ----          ---            ----      ----
                               $229          $437        $ 81       $714          $78            $356      $230
                               ====          ====        ====       ====          ===            ====      ====

                               Common Expenses
                            --------------------
                                        Total           Total      Total    Convenience or      Total Service
                                        Common         Clearing    Direct    Accommodation       Rendered By
Receiving Company           Payroll     Expense        Charges*   Charges*    Payments*     Statutory Subsidiaries
- -----------------           -------     -------        --------   --------  --------------  ----------------------
Supply Corporation           $195       $4,149          $4,537     $3,734      $ 8,973             $21,393
Seneca Resources                -          948             172        238        2,022               3,380
UCI                             -            -               -          -           16                  16
Highland                        -          107              20         38          475                 640
Data-Track                      -            -               -          -           50                  50
NFR                             -           13              38         24          280                 355
Leidy Hub                       -            -               -         13           11                  24
Horizon                         -            -               -        478           94                 572
Parent Company                  -            -               4        128          756                 888
NIM                             -            -               -          -           17                  17
Upstate Energy                  -            -               -          -           13                  13
                             ----       ------          ------     ------      -------             -------
                             $195       $5,217          $4,771     $4,653      $12,707             $27,348
                             ====       ======          ======     ======      =======             =======


* Analysis of Clearing  Charges,  Direct Charges & Convenience or  Accommodation
Payments is presented on pages 24 and 25.





ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I. Intercompany sales and services (Continued)

(2)   Services rendered by Statutory Subsidiaries

                                                       DISTRIBUTION CORPORATION
                                                       ------------------------
                                               REPORT OF INTERCOMPANY SALES AND SERVICES
                                               -----------------------------------------
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                             --------------------------------------------
                                                        (THOUSANDS OF DOLLARS)
                                                        ----------------------

                                                            Clearing Charges
                            -------------------------------------------------------------------------------
                            Material                                                           Total
                            Issue &                                       Data    Messenger   Clearing
Receiving Company           Transfer Telecommunications Rental Postage Processing  Expense     Charges
- -----------------           -------- ------------------ ------ ------- ---------- ---------   ---------
Supply Corporation           $1,923         $203          $5    $13      $2,299     $ 94       $4,537
Seneca Resources                  -           45           -      -         126        1          172
UCI                               -            -           -      -           -        -            -
Highland                          -            -           -      -          12        8           20
Data-Track                        -            -           -      -           -        -            -
NFR                               -           27           -      -           2        9           38
Leidy Hub                         -            -           -      -           -        -            -
Horizon                           -            -           -      -           -        -            -
Parent Company                    -            -           -      -           4        -            4
NIM                               -            -           -      -           -        -            -
Upstate Energy                    -            -           -      -           -        -            -
                             ------         ----          --    ---      ------     ----       ------
                             $1,923         $275          $5    $13      $2,443     $112       $4,771
                             ======         ====          ==    ===      ======     ====       ======

                                                            Direct Charges
                            -----------------------------------------------------------------------------------------
                                        Telecom-                             Contract
Receiving Company           Land  MMD  munications  Insurance  Operations  Administration     Safety  Accounting
- -----------------           ----- ---  -----------  ---------  ----------  --------------     ------  ----------
Supply Corporation          $328  $84     $41         $432       $2,058         $59             $-       $ 1
Seneca Resources               -    -       -            -           21           -              -         -
UCI                            -    -       -            -            -           -              -         -
Highland                       -    -       -            -            -           -              -         -
Data-Track                     -    -       -            -            -           -              -         -
NFR                            -    -       -            -            -           -              -         -
Leidy Hub                      -    -       -            -            -           -              -         -
Horizon                        -    -       -            -            -           -              -        65
Parent Company                 -    -       -            -            -           -              1         -
NIM                            -    -       -            -            -           -              -         -
Upstate Energy                 -    -       -            -            -           -              -         -
                            ----  ---     ---         ----       ------         ---             --       ---
                            $328  $84     $41         $432       $2,079         $59             $1       $66
                            ====  ===     ===         ====       ======         ===             ==       ===

                                                            Direct Charges
                            -----------------------------------------------------------------------------------------
                                                Government                         Energy      Rates &
Receiving Company           Legal   Purchasing   Affairs     Finance   Executive   Services   Regulation
- -----------------           -----   ----------  ----------   -------   ---------   --------   ----------
Supply Corporation           $16        $4         $243       $153       $225        $21         $1
Seneca Resources               -         -            -         22        192          -          1
UCI                            -         -            -          -          -          -          -
Highland                       -         -            -         24         14          -          -
Data-Track                     -         -            -          -          -          -          -
NFR                            -         -            -         23          1          -          -
Leidy Hub                      -         -            -          -         13          -          -
Horizon                        -         -            -         55        358          -          -
Parent Company                 -         -            -          1        119          -          -
NIM                            -         -            -          -          -          -          -
Upstate Energy                 -         -            -          -          -          -          -
                             ---        --         ----       ----       ----        ---         --
                             $16        $4         $243       $278       $922        $21         $2
                             ===        ==         ====       ====       ====        ===         ==


                                                            Direct Charges
                            -----------------------------------------------------------------------------------------
                                                                                                         Total
                            Benefit   Transportation                Quality                              Direct
Receiving Company           Services     New York     Engineering  Assurance                             Charges
- -----------------           --------  --------------  -----------  ---------                             -------
Supply Corporation            $ -         $10              $3         $55                                $3,734
Seneca Resources                2           -               -           -                                   238
UCI                             -           -               -           -                                     -
Highland                        -           -               -           -                                    38
Data-Track                      -           -               -           -                                     -
NFR                             -           -               -           -                                    24
Leidy Hub                       -           -               -           -                                    13
Horizon                         -           -               -           -                                   478
Parent Company                  8           -               -           -                                   129
NIM                             -           -               -           -                                     -
Upstate Energy                  -           -               -           -                                     -
                              ---         ---              --         ---                                ------
                              $10         $10              $3         $55                                $4,654
                              ===         ===              ==         ===                                ======






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I.  Intercompany sales and services (Continued)

        (2)     Services rendered by Statutory Subsidiaries (Continued)

                            DISTRIBUTION CORPORATION
                            ------------------------
                ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS
                -------------------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                                                Receiving Company
                     --------------------------------------------------------------------
                     Parent    Supply     Seneca       Data-              Leidy
                     Company Corporation Resources UCI Track Highland NFR  Hub  Horizon
                     ------- ----------- --------- --- ----- -------- ---  ---  -------

Material              $   1     $ 1,131   $    2   $  - $ -    $  -   $  - $ 2   $ -
Rents                     -         179        -      -   -       -      -   -     -
Transportation            -          15        1      -   -       -      -   -     2
Utilities                 -         538       82      -  31       -     23   -     -
Contractors &
 Outside Services       501         840       90      2   9      48     47   8    74
Equipment Purchases
 & Rentals                1         572       13      -   -       -      5   -     2
Employee Benefits         9       3,434        -      -   -       4    104   -     -
Office Expense           16         934       43      1   9       6     47   1    15
Dues & Subscriptions      -         211        -      -   -       -      -   -     -
Other Insurance          27         487    1,743      -   -     340     21   -     -
Injuries & Damages        -          96        3     13   -      74      1   -     -
Other                   192         524       44      -   1       3     32   -     1
Advertising               -           5        1      -   -       -      -   -     -
Postage                   9           -        -      -   -       -      -   -     -
Environmental             -           7        -      -   -       -      -   -     -
                      -----      ------   ------   ---- ---    ----   ---- ---   ---

                      $ 756     $ 8,973   $2,022   $ 16 $50    $475   $280 $11   $94
                      =====     =======   ======   ==== ===    ====   ==== ===   ===



                              Receiving Company
                              -----------------
                                   Upstate
                           NIM     Energy      Total
                           ---     ------      -----

Material                   $ -      $ -       $ 1,136
Rents                        -        -           179
Transportation               -        -            18
Utilities                    -        -           674
Contractors &
 Outside Services           15       12         1,646
Equipment Purchases
 & Rentals                   -        -           593
Employee Benefits            -        -         3,551
Office Expense               2        1         1,075
Dues & Subscriptions         -        -           211
Other Insurance              -        -         2,618
Injuries & Damages           -        -           187
Other                        -        -           797
Advertising                  -        -             6
Postage                      -        -             9
Environmental                -        -             7
                           ---      ---       -------

                           $17      $13       $12,707
                           ===      ===       =======





ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I.  Intercompany sales and services (Continued)

        (2)     Services rendered by Statutory Subsidiaries (Continued)

                               SUPPLY CORPORATION
                               ------------------
                    REPORT OF INTERCOMPANY SALES AND SERVICES
                    -----------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                            Clearing Accounts                     Direct Charges
                   ------------------------------------  ---------------------------------
                               Material         Total
                   Production  Issue &  Rental Clearing            Interstate
Receiving Company   Clearing   Transfer Clear  Charges   Insurance Marketing   Finance
- -----------------   --------   -------- -----  -------   --------- ----------   -------

Distribution Corp.    $  -      $  935  $2,783  $3,718      $17       $ 7       $  -
Seneca Resources       200           3       -     203        -         -          -
Horizon                  -           -       9       9        -         -         51
Highland                 -           -       -       -        -         -          -
Data Track               -           -       -       -        -         -          -
NFR                      -           -       -       -        -         -          -
Leidy Hub                -           -       -       -        -         -          -
Parent Company           -           -      11      11        -         -          -
Upstate Energy           -           -       -       -        -         -          -
                      ----      ------  ------  ------      ---       ---       ----

                      $200      $  938  $2,803  $3,941      $17       $ 7       $ 51
                      ====      ======  ======  ======      ===       ===       ====


                                               Direct Charges Continued
                        ------------------------------------------------------------------
                                                                      Operations,
                                                                     Construction &
                                  Human            Gas                  Customer
Receiving Company  Engineering  Resources  Land  Control  Executive     Service      Legal
- -----------------  -----------  ---------  ----  -------  ---------  --------------  -----

Distribution Corp.   $ 19         $110     $235  $1,190      $186        $1,856       $17
Seneca Resources        -            -       48       -        17            79         -
Horizon                 -            -        -       -       367             -         -
Highland                -            3        -       -         2             -         -
Data Track              -            -        -       -         7             -         -
NFR                     -            1        -       -         7             -         -
Leidy Hub               -            -        -       -         -             -         -
Parent Company          -            2        -       -       124             -         -
Upstate Energy          -            -        -       -         -             -         -
                     ----         ----     ----  ------      ----        ------       ---

                     $ 19         $116     $283  $1,190      $710        $1,935       $17
                     ====         ====     ====  ======      ====        ======       ===

                                                             Total Services
                     Total     Total     Convenience or       Rendered By
                    Direct    Clearing   Accommodation         Statutory
Receiving Company   Charges   Charges      Payments*          Subsidiaries
- -----------------   -------   --------   --------------      ---------------

Distribution Corp.  $3,637     $3,718        $1,789              $ 9,144
Seneca Resources       144        203             7                  354
Horizon                418          9             -                  427
Highland                 5          -             2                    7
Data Track               7          -             1                    8
NFR                      8          -            23                   31
Leidy Hub                -          -             -                    -
Parent Company         126         11            17                  154
Upstate Energy           -          -             -                    -
                    ------     ------        ------              -------

                    $4,345     $3,941        $1,839              $10,125
                    ======     ======        ======              =======


* Analysis of Convenience or Accommodation Payments is presented on page 27.






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I.  Intercompany sales and services (Continued)

        (2)     Services rendered by Statutory Subsidiaries (Continued)

                               SUPPLY CORPORATION
                               ------------------
                ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS
                -------------------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                                          Receiving Company
                      ----------------------------------------------------------
                       Parent   Distribution   Seneca    Horizon
                       Company  Corporation   Resources  Energy   Highland
                       -------  -----------   ---------  ------   --------

Material                 $ -       $  211       $ 2        $-       $ -
Rents                      -            -         -         -         -
Transportation             -            4         -         -         -
Utilities                  -           71         -         -         -
Contractors &
 Outside Services          -          456         1         -         -
Equipment Purchases
 & Rentals                 -          137         -         -         -
Employee Benefits         14          279         2         2         -
Office Expense             -           93         1        (2)        -
Dues & Memberships         -           18         -         -         -
Other                      1          321         1         -         2
Other Insurance            2          199         -         -         -
Postage                    -            -         -         -         -
Advertising                -            -         -         -         -
Environmental              -            -         -         -         -
                         ---       ------       ---        --       ---

                         $17       $1,789       $ 7        $-       $ 2
                         ===       ======       ===        ==       ===


                              Receiving Company
                      -------------------------------
                      Data-                  Upstate
                      Track  NFR  Leidy Hub  Energy       Total
                      -----  ---  ---------  ------       -----

Material               $-    $ -     $-        $-         $  213
Rents                   -      -      -         -              -
Transportation          -      -      -         -              4
Utilities               -      -      -         -             71
Contractors &
 Outside Services       -      -      -         -            457
Equipment Purchases
 & Rentals              -      -      -         -            137
Employee Benefits       1      1      -         -            299
Office Expense          -      -      -         -             92
Dues & Memberships      -      -      -         -             18
Other                   -     22      -         -            347
Other Insurance         -      -      -         -            201
Postage                 -      -      -         -              -
Advertising             -      -      -         -              -
Environmental           -      -      -         -              -
                       --    ---     --        --         ------

                       $1    $23     $-        $-         $1,839
                       ==    ===     ==        ==         ======






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I.  Intercompany sales and services (Continued)

  (2)  Services rendered by Statutory Subsidiaries (Continued)

                                SENECA RESOURCES
                                ----------------
                    REPORT OF INTERCOMPANY SALES AND SERVICES
                    -----------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                                                                            Total
                                                                           Services
                                                         Convenience or  Rendered By
                                   Timber                Accommodation    Statutory
Receiving Company                  Sales     Operations     Payments     Subsidiaries
- -----------------                  -----     ----------     --------     ------------

Supply Corporation                $     -      $  655         $  5         $   660
Highland                           10,227           -            -          10,227
NFR                                     -       1,594          183           1,777
Upstate Energy                          -          89           15             104
Parent Company                          -           -            -               -
NFE                                     -           -           42              42
Horizon                                 -           -            4               4
                                  -------      ------         ----         -------

                                  $10,227      $2,338         $249         $12,814
                                  =======      ======         ====         =======


                ANALYSIS OF CONVENIENCE OR ACCOMMODATION PAYMENTS
                -------------------------------------------------

                                        Receiving Company
                     -----------------------------------------------------
                              Upstate    Supply
                     Horizon  Energy   Corporation   NFR     NFE     Total
                     -------  ------   -----------   ---   --------  -----

Other                  $4       $15        $5        $183     $42    $249
                       --       ---        --        ----     ---    ----

                       $4       $15        $5        $183     $42    $249
                       ==       ===        ==        ====     ===    ====






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Continued)
- -------  -----------------------------------------------------

Part I.  Intercompany sales and services (Concluded)

  (2)  Services rendered by Statutory Subsidiaries (Concluded)


                                    HIGHLAND
                                    --------
                    REPORT OF INTERCOMPANY SALES AND SERVICES
                    -----------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                                                Total Services
                                                  Rendered By
                               Convenience         Statutory
Receiving Company               Payments          Subsidiaries
- -----------------              -----------       --------------

Seneca Resources                  $268                $268

Supply Corporation                   4                   4
                                  ----                ----

                                  $272                $272
                                  ====                ====


                                   DATA-TRACK
                                   ----------
                    REPORT OF INTERCOMPANY SALES AND SERVICES
                    -----------------------------------------
                  FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                  --------------------------------------------
                             (THOUSANDS OF DOLLARS)
                             ----------------------

                                                        Total Services
                                                         Rendered by
                                         Collection       Statutory
Receiving Company                         Services       Subsidiaries
- -----------------                        ----------     ----------------

Distribution Corporation                    $390             $390

NFR                                            5                5
                                            ----             ----


                                            $395             $395
                                            ====             ====


        (3)     Services rendered by Registrant

                No services were rendered for a charge by the  Registrant to any
                of its  subsidiaries  during the fiscal year ended September 30,
                2000.






ITEM 8.  SERVICE, SALES AND CONSTRUCTION CONTRACTS (Concluded)
- -------  -----------------------------------------------------

Part II. Contracts to purchase  services or goods between any System company and
         any affiliate at September 30, 2000:

                 None

Part III.  Employment of any person by any System company for the performance on
           a continuing basis of management services:

                                Description of Contract and         Annual
                Name                 Scope of Services           Consideration
           --------------       ---------------------------      -------------

           Robert Davis         Performs management and            $100,000
                                consulting services for
                                Highland.

           Joseph Maljovec      Performs management and            $ 66,300
                                consulting services for
                                Highland.

ITEM 9.  WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES
- -------  --------------------------------------------------

Part I.           A.       Interests in Foreign Utility Companies

                           1.       United Energy, a.s. and Teplarna Liberec, a.s.

                           (a)      United Energy, a.s. (UE)
                                    Komorany u Mostu
                                    434 03 Most
                                    Czech Republic

                                    Teplarna Liberec, a.s. (TL)
                                    Dr. M. Horakove 641/34a
                                    460 01 Liberec
                                    Czech Republic

                                    UE was formed  during the fiscal  year ended
                                    September  30,  2000  by the  merger  of two
                                    separate    foreign    utility     companies
                                    ultimately   owned  by  National   Fuel  Gas
                                    Company--Severoceske   teplarny,   a.s.  and
                                    Prvni  severozapadni  teplarenska,  a.s.  UE
                                    generates   and   supplies   steam  heat  to
                                    customers  in the  Czech  Republic.  UE also
                                    generates  electric  energy for sale. UE has
                                    been designated as a foreign utility company
                                    because it owns and  operates  a  coal-fired
                                    electric  generation  plant with  generating
                                    capacity of 236 MW and sells the electricity
                                    it produces at  wholesale.  UE has also been
                                    designated  as  a  foreign  utility  company
                                    because  it  owns  a  70%  interest  (common
                                    equity)  in  TL.  TL,  in  turn,   has  been
                                    designated  as  a  foreign  utility  company
                                    because  it owns and  operates a 12 MW steam
                                    powered  electric   generation  turbine  and
                                    sells the produced electricity at wholesale.

                                    Horizon Energy  Development,  Inc. (Horizon)
                                    owns 100% of the  capital  stock of  Horizon
                                    Energy Holdings, Inc. (HEHI) which owns 100%
                                    of  the  capital  stock  of  Horizon  Energy
                                    Development B.V. (HEDBV).  HEDBV owns 84.73%
                                    of the capital stock of UE which owns 70% of
                                    the capital stock of TL.





ITEM 9.  WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
- -------  --------------------------------------------------------------


                           (b)      Horizon  owns 100% of the  capital  stock of
                                    HEHI,   which   investment   was  valued  at
                                    $101,754,000  as of September 30, 2000. HEHI
                                    owns  100% of the  capital  stock of  HEDBV,
                                    which  investment was valued at $101,754,000
                                    as of September 30, 2000.  HEDBV owns 84.73%
                                    of the capital stock of consolidated UE, and
                                    such investment was valued  at  $100,780,000
                                    as of September 30, 2000. UE owns 70% of the
                                    capital stock of TL, and such investment was
                                    valued at  $7,565,000  as of  September  30,
                                    2000.  The  financial  statements of Horizon
                                    and its  subsidiaries  are found on pages 56
                                    through 90 of this Form U5S.

                                    There  are  no  debts  or  other   financial
                                    obligations  of  HEHI,  HEDBV,  UE or TL for
                                    which   there  is   recourse,   directly  or
                                    indirectly,   to  the   registered   holding
                                    company or another system company. There are
                                    no direct or indirect  guaranties  of any of
                                    the securities of UE or TL by the registered
                                    holding   company.   There   have   been  no
                                    transfers  of any  assets  from  any  system
                                    company to TL.

                           (c)      The ratio of debt to common equity of UE was
                                    52.90% as of September  30, 2000.  TL had no
                                    debt  outstanding at September 30, 2000. The
                                    earnings  (loss) of UE and TL for the twelve
                                    months  ended  September  30,  2000  (net of
                                    minority   interest)  were   $7,664,000  and
                                    $(513,000),   respectively.   The  financial
                                    statements  of UE and TL are  found on pages
                                    77 through 86 of this Form U5S.

                           (d)      There  are  management   support  agreements
                                    between Horizon Energy  Development,  s.r.o.
                                    (HED) and UE and TL. Under these agreements,
                                    HED  agrees to provide  management  services
                                    (i.e., strategic,  legal, marketing,  public
                                    relations  and human  resource  services) to
                                    both UE and TL. The agreement  with UE calls
                                    for UE to pay HED CZK 1,975,000 on a monthly
                                    basis.  The  agreement  with TL calls  for a
                                    monthly payment of CZK 750,000 to HED.

                                    There is a service  agreement between UE and
                                    TL calling for TL to pay UE CZK 1,630,000 on
                                    a monthly  basis.  The  services UE provides
                                    are similar to those described above.

                           2.       Teplarna Kromeriz, a.s.

                           (a)      Teplarna Kromeriz, a.s. (Kromeriz)
                                    Na Sadkach 3572
                                    767 01 Kromeriz
                                    Czech Republic

                                    Kromeriz  generates and supplies  steam heat
                                    to customers in the Czech  Republic.  It has
                                    been designated as a foreign utility company
                                    because it has  developed  initial  plans to
                                    add a 38 MW simple-cycle electric generating
                                    unit on its site.

                                    Horizon  owns 100% of the  capital  stock of
                                    HEHI which owns 100% of the capital stock of
                                    HEDBV.  HEDBV  owns  100%  of  the  business
                                    shares of Power Development, s.r.o., (PD) (a
                                    limited  liability  company) which owns 100%
                                    of the capital stock of Kromeriz.





ITEM 9.  WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Continued)
- -------  --------------------------------------------------------------


                           (b)      Horizon  owns 100% of the  capital  stock of
                                    HEHI,   which   investment   was  valued  at
                                    $101,754,000  as of September 30, 2000. HEHI
                                    owns  100% of the  capital  stock of  HEDBV,
                                    which  investment was valued at $101,754,000
                                    as of September 30, 2000. HEDBV owns 100% of
                                    the   business   shares  of  PD,   and  such
                                    investment  was valued at  $1,240,000  as of
                                    September  30,  2000.  PD  owns  100% of the
                                    capital   stock   of   Kromeriz,   and  such
                                    investment  was  valued  at  $586,000  as of
                                    September 30, 2000. The financial statements
                                    of Horizon and its subsidiaries are found on
                                    pages 56 through 90 of this Form U5S.

                                    There  are  no  debts  or  other   financial
                                    obligations of HEHI,  HEDBV,  PD or Kromeriz
                                    for which  there is  recourse,  directly  or
                                    indirectly,   to  the   registered   holding
                                    company or another system company. There are
                                    no direct or indirect  guaranties  of any of
                                    the securities of Kromeriz by the registered
                                    holding   company.   There   have   been  no
                                    transfers  of any  assets  from  any  system
                                    company to Kromeriz.

                           (c)      The  ratio  of  debt  to  common  equity  of
                                    Kromeriz  was  24.23%  as of  September  30,
                                    2000.  Kromeriz posted net income of $11,000
                                    for the twelve  months ended  September  30,
                                    2000.  The financial  statements of Kromeriz
                                    are  found on pages  86  through  90 of this
                                    Form U5S.

                           (d)      There  is  a  management  support  agreement
                                    between   HED  and   Kromeriz.   Under  this
                                    agreement,  HED agrees to provide management
                                    services (i.e., strategic, legal, marketing,
                                    public    relations   and   human   resource
                                    services) to Kromeriz.  The agreement  calls
                                    for  Kromeriz  to  pay HED CZK  210,000 on a
                                    monthly basis.



                  B.       Interests in Exempt Wholesale Generators

                           (a)      NFR Power, Inc. (Power)
                                    165 Lawrence Bell Drive
                                    Suite 120
                                    Williamsville, New York  14221

                                    Power  has  been  designated  as  an  exempt
                                    wholesale  generator  by the Federal  Energy
                                    Regulatory Commission and has acquired a 50%
                                    interest  in  Seneca  Energy  II,  LLC which
                                    generates approximately 11 MW of electricity
                                    by  using   methane  gas  obtained   from  a
                                    landfill owned by an outside party and sells
                                    that  electricity  at  wholesale to a public
                                    utility.  The  Registrant  owns  100% of the
                                    capital stock of Power.

                           (b)      The  Registrant  owns  100%  of the  capital
                                    stock of Power.  As of  September  30, 2000,
                                    such  investment  was valued at  $4,916,000.
                                    The financial  statements of Power are found
                                    on pages 37 through 50 of this Form U5S.

                                    As of  September  30,  2000,  there  were no
                                    debts  or  other  financial  obligations  of
                                    Power for which there was recourse, directly
                                    or  indirectly,  to the  registered  holding
                                    company or another system company.





ITEM 9.  WHOLESALE GENERATORS AND FOREIGN UTILITY COMPANIES (Concluded)
- -------  --------------------------------------------------------------


                                    There are no direct or  indirect  guarantees
                                    of any securities of Power by the registered
                                    holding company other than one guaranty from
                                    National   Fuel  Gas  Company  in  favor  of
                                    KeyCorp  Leasing  in the  maximum  amount of
                                    $5,000,000.  There have been no transfers of
                                    any assets from any system company to Power.

                           (c)      The ratio of debt to common  equity of Power
                                    was in excess of 0% at  September  30, 2000.
                                    Power  posted  a net  loss of  approximately
                                    $26,000   for  the   twelve   months   ended
                                    September 30, 2000 The financial  statements
                                    of Power are found on pages 37 through 50 of
                                    this Form U5S.

                           (d)      There are no services, sales or construction
                                    contracts between Power and any system company.

Part II           Relationship  of Exempt  Wholesale  Generators and Foreign
                  Utility Companies to System Companies

                  Organization charts showing the relationships of Kromeriz, TL,
                  UE and Power to system  companies  are provided as Exhibits
                  H-1, H-2 and H-3 to this Form U5S.

Part III          Aggregate  Investment in Exempt  Wholesale  Generators and
                  Foreign Utility Companies

                  The  Registrant's  aggregate  investment  in exempt  wholesale
                  generators and foreign utility companies at September 30, 2000
                  was $10,020,000 and $108,053,435, respectively, for a total of
                  $118,073,435.  The  aggregate  investment  in foreign  utility
                  companies  and exempt  wholesale  generators  was 21.0% of its
                  aggregate capital investment in Distribution Corporation,  the
                  Registrant's domestic public utility subsidiary. The aggregate
                  investment  amounts  used in this  calculation  represent  the
                  money paid for common stock and long-term or  short-term  debt
                  (including  net money  pool  borrowings)  for  which  there is
                  recourse, directly or indirectly, to National Fuel Gas Company
                  or any subsidiary company thereof.








ITEM 10.  FINANCIAL STATEMENTS AND EXHIBITS
- --------  ---------------------------------

                   NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                   ------------------------------------------
                          INDEX TO FINANCIAL STATEMENTS
                          -----------------------------
                               SEPTEMBER 30, 2000
                               ------------------

                                                                         Page
                                                                         ----

National Fuel Gas Company and Subsidiaries:
Report of Independent Accountants                                         36
Consolidating and Consolidated Balance Sheet at September 30, 2000       37-40
Consolidating and Consolidated Statement of Income for the Fiscal
  Year Ended September 30, 2000                                          41-42
Consolidating and Consolidated Statement of Earnings Reinvested in
  the Business for the Fiscal Year Ended September 30, 2000              43-44
Consolidating and Consolidated Statement of Cash Flows for the
  Fiscal Year Ended September 30, 2000                                   45-48
Consolidating and Consolidated Statement of Comprehensive Income
  for the Fiscal Year Ended September 30, 2000                           49-50

Seneca Resources Corporation:
Consolidating Balance Sheet at September 30, 2000                         51
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                      52
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                            53
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                                54
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                                55

Horizon Energy Development, Inc. and Subsidiaries:
Consolidating Balance Sheet at September 30, 2000                         56
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                      57
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                            58
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                                59
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                                60

Horizon Energy Holdings, Inc.:
Consolidating Balance Sheet at September 30, 2000                         61
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                      62
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                            63
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                                64
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                                65

Horizon Energy Development B.V.:
Consolidating Balance Sheet at September 30, 2000                        66-67
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                     68-69
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                           70-71
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                               72-73
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                               74-75





ITEM 10.  FINANCIAL STATEMENTS AND EXHIBITS (Concluded)
- --------  ---------------------------------------------

                   NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                   ------------------------------------------
                          INDEX TO FINANCIAL STATEMENTS
                          -----------------------------
                               SEPTEMBER 30, 2000
                               ------------------

                                                                         Page
                                                                         ----

United Energy, a.s.:
Consolidating Balance Sheet at September 30, 2000                        76-77
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                     78-79
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                           80-81
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                               82-83
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                               84-85

Power Development, s.r.o. (Power Development):
Consolidating Balance Sheet at September 30, 2000                         86
Consolidating Statement of Income for the Fiscal Year Ended
  September 30, 2000                                                      87
Consolidating Statement of Earnings Reinvested in the Business
  for the Fiscal Year Ended September 30, 2000                            88
Consolidating Statement of Cash Flows for the Fiscal Year
  Ended September 30, 2000                                                89
Consolidating Statement of Comprehensive Income for the Fiscal Year
  Ended September 30, 2000                                                90


Notes to Consolidated Financial Statements                                 *



*    The  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, are incorporated herein by reference.











                        REPORT OF INDEPENDENT ACCOUNTANTS






To the Board of Directors
and Shareholders of
National Fuel Gas Company

In our  opinion,  the  consolidated  financial  statements  listed  in the index
appearing  under  Item 10 on Pages 34 and 35  present  fairly,  in all  material
respects,   the  financial  position  of  National  Fuel  Gas  Company  and  its
subsidiaries  at September  30, 2000,  and the results of their  operations  and
their  cash  flows  for the year  then  ended,  in  conformity  with  accounting
principles  generally accepted in the United States.  These financial statements
are the  responsibility of the Company's  management;  our  responsibility is to
express  an  opinion  on  these  financial  statements  based on our  audit.  We
conducted our audit of these  statements in accordance  with auditing  standards
generally  accepted in the United  States which require that we plan and perform
the audit to obtain reasonable  assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence  supporting the amounts and  disclosures  in the financial  statements,
assessing the  accounting  principles  used and  significant  estimates  made by
management,  and evaluating the overall  financial  statement  presentation.  We
believe  that our audit  provides a reasonable  basis for the opinion  expressed
above.

Our audit was made for the  purpose of  forming  an opinion on the  consolidated
financial statements taken as a whole. The consolidating information on pages 37
through 90 is  presented  for  purposes of  additional  analysis  rather than to
present  financial  position,  results  of  operations  and  cash  flows  of the
individual companies. Accordingly, we do not express an opinion on the financial
position,  results of  operations  and cash flows of the  individual  companies.
However, the consolidating information on pages 37 through 90 has been subjected
to the auditing  procedures  applied in the audit of the consolidated  financial
statements  and, in our opinion,  is fairly  stated in all material  respects in
relation to the consolidated financial statements taken as a whole.



PricewaterhouseCoopers LLP
Buffalo, New York
October 23, 2000





                   NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                           CONSOLIDATING BALANCE SHEET
                              AT SEPTEMBER 30, 2000
                             (THOUSANDS OF DOLLARS)

                                  National    National     Seneca               Highland    Data-Track
                      National    Fuel Gas    Fuel Gas    Resources     Leidy    Forest       Account
                      Fuel Gas  Distribution   Supply    Corporation     Hub,  Resources,    Services,
                      Company      Corp.        Corp.   (Consolidated)   Inc.     Inc.         Inc.
                      --------  ------------  --------   ------------   ------ ---------    ------------
    ASSETS
    ------

PROPERTY, PLANT
  & EQUIPMENT      $      132   $1,296,810   $776,977     $1,436,384    $    -   $68,049        $144
- -------------

Less: Accumulated
 Depreciation,
 Depletion and
 Amortization             128      357,058    302,005        405,908         -     4,067          27
                   ----------   ----------   --------     ----------    ------   -------        ----
                            4      939,752    474,972      1,030,476         -    63,982         117
                   ----------   ----------   --------     ----------    ------   -------        ----

CURRENT ASSETS:
- ---------------
  Cash and Temporary
    Cash Investments       56        2,034        966          8,615        86       298          72
  Notes Receivable
    -Intercompany     685,300            -          -         22,000       800         -         700
  Allowance for
    Uncollectible
    Accounts                -      (10,372)         -            (70)        -         -           -
  Accounts Receivable
    -Intercompany      21,657        5,496     10,027          5,310         4       363         105
  Accounts Receivable     343       61,924     12,086         38,900         -     1,921           -
  Unbilled Utility
    Revenue                 -       24,259          -              -         -         -           -
  Dividends Receivable
    -Intercompany      17,354            -          -              -         -         -           -
  Materials and
    Supplies - at
    average cost            -        4,456      7,752          4,273         -     5,784           -
  Gas Stored
    Underground             -       29,335          -              -         -         -           -
  Unrecovered
    Purchased
    Gas Costs               -       29,681          -              -         -         -           -
  Prepayments             507       15,754      4,839         11,033         -       397           5
                   ----------   ----------   --------     ----------    ------   -------        ----
                      725,217      162,567     35,670         90,061       890     8,763         882
                   ----------   ----------   --------     ----------    ------   -------        ----

OTHER ASSETS:
- ------------
  Recoverable Future
    Taxes                   -       79,254      4,945              -         -         -           -
  Unamortized Debt
    Expense             6,387        9,935      6,079              -         -         -           -
  Other Regulatory
    Assets              5,009       10,141      2,368              -         -         -           -
  Deferred Charges      2,667        1,475      5,662          3,016         -         -           -
  Investment in
    Associated
    Companies         908,872            -         61              -         -         -           -
  Notes Receivable -
    Intercompany      924,000            -          -              -         -         -           -
  Other                14,081       16,372      8,561          1,996         -     1,333           -
                   ----------   ----------   --------     ----------    ------   -------        ----
                    1,861,016      117,177     27,676          5,012         -     1,333           -
                   ----------   ----------   --------     ----------    ------   -------        ----
                   $2,586,237   $1,219,496   $538,318     $1,125,549    $  890   $74,078        $999
                   ==========   ==========   ========     ==========    ======   =======        ====


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.









               Horizon
 National       Energy                 Seneca    Niagara
   Fuel      Development,    Upstate   Indep.    Indep.     NFR    Total Before   Eliminations    Consolidated
Resources,       Inc.        Energy   Pipeline  Marketing  Power,  Eliminations   & Adjustments   Company and
   Inc.     (Consolidated)    Inc.    Company    Company    Inc.   & Adjustments     Dr (Cr)      Subsidiaries
- ----------  --------------   -------  --------  ---------  ------  -------------  -------------   ------------




  $   866      $249,074      $ 990    $    -       $ -     $210     $3,829,637    $         -     $3,829,637




      506        76,472         54         -         -       21      1,146,246              -      1,146,246
  -------      --------      -----    ------       ---     ----     ----------    -----------     ----------
      360       172,602        936         -         -      189      2,683,391              -      2,683,391
  -------      --------      -----    ------       ---     ----     ----------    -----------     ----------



   13,940         5,602         64        89         1      259         32,081             44         32,125

        -             -          -         -         -        -        708,800       (708,800)             -


     (997)         (574)         -         -         -        -        (12,013)             -        (12,013)

    7,739             -          -         -         -      700         51,401        (51,401)             -
   12,350         6,465         18         -         -      133        134,140              -        134,140

        -         2,846          -         -         -        -         27,105              -         27,105

        -             -          -         -         -        -         17,354        (17,354)             -


        -         4,873          -         -         -        -         27,138         (1,993)        25,145

   13,774             -     12,685         -         -        -         55,795              -         55,795


        -             -          -         -         -        -         29,681              -         29,681
     (306)           64          -         -         -        -         32,293              -         32,293
  -------      --------     ------    ------       ---    -----     ----------    -----------     ----------
   46,500        19,276     12,767        89         1    1,092      1,103,775       (779,504)       324,271
  -------      --------     ------    ------       ---    -----     ----------    -----------     ----------



        -             -          -         -         -        -         84,199              -         84,199

        -             -          -         -         -        -         22,401         (2,560)        19,841

        -             -          -         -         -        -         17,518              -         17,518
      108            72      1,359         -         -        -         14,358         (1,861)        12,497


        -             -          -         -         -        -        908,933       (908,933)             -

        -             -          -         -         -        -        924,000       (924,000)             -
      153        10,672          -    13,652         -    3,697         70,516         24,655         95,171
  -------      --------     ------   -------       ---    -----     ----------    -----------     ----------
      261        10,744      1,359    13,652         -    3,697      2,041,926     (1,812,698)       229,226
  -------      --------     ------   -------       ---    -----     ----------    -----------     ----------
  $47,121      $202,622    $15,062   $13,741       $ 1   $4,978     $5,829,092    $(2,592,204)    $3,236,888
  =======      ========    =======   =======       ===   ======     ==========    ===========     ==========






                   NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                           CONSOLIDATING BALANCE SHEET
                              AT SEPTEMBER 30, 2000
                             (THOUSANDS OF DOLLARS)


                                     National   National     Seneca             Highland    Data-Track
                          National   Fuel Gas   Fuel Gas    Resources    Leidy   Forest       Account
                          Fuel Gas Distribution  Supply    Corporation    Hub,  Resources,   Services,
                          Company     Corp.       Corp.   (Consolidated)  Inc.    Inc.          Inc.
                          -------- ------------ --------   ------------ ------- ---------   ----------
CAPITALIZATION
AND LIABILITIES
- ---------------

CAPITALIZATION:
- --------------
  Common Stock $1 Par
    Value; Authorized -
    200,000,000 Shares;
    Issued and
    Outstanding -
    39,329,803 Shares   $   39,330   $        -  $      -    $      -    $    -   $     -     $    -
  Capital Stock of
    Subsidiaries                 -       59,170    25,345         500         4         4          1
  Paid in Capital          452,217      121,669    35,894     104,035     1,365     3,005        499
  Earnings  Reinvested
    in the Business        525,847      305,654   211,328      13,009      (654)    4,836        251
  Accumulated Other
    Comprehensive
    Income                 (29,957)           -         -      (4,331)        -         -          -
                        ----------   ----------  --------    --------    ------   -------       ----
  Total Common
    Stock Equity           987,437      486,493   272,567     113,213       715     7,845        751

  Long-Term Debt,
    Net of Current
    Portion                924,000          259         -           -         -         -          -
  Notes Payable -
    Intercompany                 -      299,000   115,000     420,000         -         -          -
                        ----------   ----------  --------    --------    ------   -------       ----
Total Capitalization     1,911,437      785,752   387,567     533,213       715     7,845        751
                        ----------   ----------  --------    --------    ------   -------       ----

Minority Interest in
  Foreign Subsidiaries           -            -         -           -         -         -          -
                        ----------   ----------  --------    --------    ------   -------       ----

CURRENT AND ACCRUED
LIABILITIES:
- -----------
  Notes Payable to
    Banks and
    Commercial Paper       601,200            -         -           -         -         -          -
  Notes Payable -
    Intercompany            23,500       83,000    49,900     431,300         -    60,100          -
  Current Portion of
    Long-Term Debt               -          712       262       1,747         -         -          -
  Accounts Payable              50       49,170     9,979      17,544         -     1,589         10
  Amounts Payable to
    Customers                    -        9,583         -           -         -         -          -
  Accounts Payable -
    Intercompany               900       13,728     5,534      15,187        36     2,604        193
  Dividends Payable -
    Intercompany                 -        8,700     6,154       2,000         -       400          -
  Other Accruals and
    Current Liabilities     43,244       23,498     9,313       5,548         3       865         17
                        ----------   ----------  --------    --------    ------   -------       ----
                           668,894      188,391    81,142     473,326        39    65,558        220
                        ----------   ----------  --------    --------    ------   -------       ----

DEFERRED CREDITS:
- ----------------
  Accumulated Deferred
    Income  Taxes             (546)     152,669    54,896     112,142       134         9        (60)
  Taxes Refundable to
    Customers                    -       17,085    (2,676)          -         -         -          -
  Unamortized
    Investment Tax
    Credit                       -        9,644       307           -         -         -          -
  Other Deferred
    Credits                  6,452       65,955    17,082       6,868         2       666         88
                        ----------   ----------  --------    --------    ------   -------       ----
                             5,906      245,353    69,609     119,010       136       675         28
                        ----------   ----------  --------    --------    ------   -------       ----
                        $2,586,237   $1,219,496  $538,318  $1,125,549    $  890   $74,078       $999
                        ==========   ==========  ========  ==========    ======   =======       ====

See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.










              Horizon
 National      Energy                 Seneca    Niagara
   Fuel      Development,    Upstate  Indep.     Indep.      NFR    Total Before   Eliminations    Consolidated
Resources,       Inc.        Energy   Pipeline  Marketing   Power,  Eliminations   & Adjustments   Company and
   Inc.     (Consolidated)    Inc.    Company    Company     Inc.   & Adjustments     (Dr) Cr      Subsidiaries
- ----------  --------------  --------  --------  ---------   -----   -------------  -------------   ------------










  $     -       $      -     $     -   $     -     $ -      $  -    $   39,330    $         -     $   39,330

       10              5           1         1       1         1        85,043        (85,043)             -
    3,490         38,246           -         -       -     5,020       765,440       (313,223)       452,217

    1,533         (6,102)       (816)      907       -      (105)    1,055,688       (529,841)       525,847


        -        (27,604)          -         -       -         -       (61,892)        31,935        (29,957)
  -------       --------     -------   -------     ---     -----    ----------    -----------     ----------

    5,033          4,545        (815)      908       1     4,916     1,883,609       (896,172)       987,437



        -         29,364           -         -       -         -       953,622              -        953,622

        -         90,000           -         -       -         -       924,000       (924,000)             -
  -------       --------     -------   -------     ---     -----    ----------    -----------     ----------
    5,033        123,909        (815)      908       1     4,916     3,761,231     (1,820,172)     1,941,059
  -------       --------     -------   -------     ---     -----    ----------    -----------     ----------


        -         23,031           -         -       -         -        23,031              -         23,031
  -------       --------     -------   -------     ---      ----    ----------    -----------     ----------





        -         18,302           -         -       -         -       619,502              -        619,502

   33,900          8,700       6,400    12,000       -         -       708,800       (708,800)             -

        -          8,540           -         -       -         -        11,262              -         11,262
    5,080          9,691           -         -       -        26        93,140         (4,170)        88,970

        -              -           -         -       -         -         9,583              -          9,583

      225          3,378       7,769        84       -        43        49,681        (49,681)             -

      100              -           -         -       -         -        17,354        (17,354)             -

    4,528         (3,076)      1,799      (178)      -        (4)       85,554           (593)        84,961
  -------       --------      ------   -------     ---      ----    ----------    -----------     ----------
   43,833         45,535      15,968    11,906       -        65     1,594,876       (780,598)       814,278
  -------       --------      ------   -------     ---      ----    ----------    -----------     ----------



   (2,803)         9,266         (91)      927       -        (3)      326,542            452        326,994

        -              -           -         -       -         -        14,410              -         14,410


        -              -           -         -       -         -         9,951              -          9,951

    1,058            881           -         -       -         -        99,052          8,113        107,165
  -------       --------      ------   -------     ---    ------    ----------    -----------     ----------
   (1,745)        10,147         (91)      927       -        (3)      449,955          8,565        458,520
  -------       --------      ------   -------     ---    ------    ----------    -----------     ----------
  $47,121       $202,622     $15,062   $13,741     $ 1    $4,978    $5,829,092    $(2,592,204)    $3,236,888
  =======       ========     =======   =======     ===    ======    ==========    ===========     ==========





                                           NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                                               CONSOLIDATING STATEMENT OF INCOME
                                          FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                     (THOUSANDS OF DOLLARS)

                                     National   National     Seneca             Highland   Data-Track
                          National   Fuel Gas   Fuel Gas    Resources    Leidy   Forest      Account
                          Fuel Gas Distribution  Supply    Corporation    Hub,  Resources,  Services,
                          Company     Corp.       Corp.   (Consolidated)  Inc.     Inc.        Inc.
                          -------- ------------ --------   ------------ ------- ---------  -----------


OPERATING REVENUE:       $      -    $846,459   $169,659    $248,396     $  -    $39,073       $395
- -----------------        --------    --------   --------    --------     ----    -------       ----

OPERATING EXPENSE:
- -----------------
  Purchased Gas                 -     454,567      1,214      16,093        -          -          -
  Fuel Used in Heat and
   Electric Generation          -           -          -           -        -          -          -
  Operation                 3,814     159,581     58,455      53,973       37     30,670        373
  Maintenance                   -      13,632      9,751          28        -          -          -
  Property, Franchise &
   Other Taxes                507      56,680     11,688       6,630       (2)       314          -
  Depreciation, Depletion
   and Amortization             2      35,842     23,379      70,591        -      1,086         21
  Income Taxes               (399)     38,362     21,931      22,075       (2)     1,839         19
                         --------    --------   --------    --------     ----    -------       ----
                            3,924     758,664    126,418     169,390       33     33,909        413
                         --------    --------   --------    --------     ----    -------       ----
     Operating Income
      (Loss)               (3,924)     87,795     43,241      79,006      (33)     5,164        (18)
                         --------    --------   --------    --------     ----    -------       ----


OTHER INCOME:
- ------------
  Unremitted Earnings
   of Subsidiaries         57,826           -          -           -        -          -          -
  Dividends from
   Subsidiaries            69,416           -          -           -        -          -          -
  Interest-Intercompany    90,472         171          -       1,213       47          -         42
  Other                       545       1,351        536       2,851      (17)       831          -
                         --------    --------   --------    --------     ----    -------       ----
                          218,259       1,522        536       4,064       30        831         42
                         --------    --------   --------    --------     ----    -------       ----
     Income (Loss) Before
      Interest Charges
      and Minority
      Interest in
      Foreign
      Subsidiaries        214,335      89,317     43,777      83,070       (3)     5,995         24
                         --------    --------   --------    --------     ----     ------       ----


INTEREST CHARGES:
- ----------------
  Interest on Long-Term
   Debt                    61,781           -          -         216        -          -          -
  Interest-Intercompany     1,501      25,428     11,874      42,234        -      3,497          -
  Other Interest           23,846       6,227        736         835        -          1          -
                         --------    --------   --------    --------     ----    -------       ----
                           87,128      31,655     12,610      43,285        -      3,498          -
                         --------    --------   --------    --------     ----    -------       ----
Minority Interest in
 Foreign Subsidiaries           -           -          -           -        -          -          -
                         ---------   --------   --------    --------     ----    -------       ----

Net Income (Loss)
 Available for
 Common Stock            $127,207    $ 57,662   $ 31,167    $ 39,785     $ (3)   $ 2,497       $ 24
                         ========    ========   ========    ========     =====   =======       ====


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.









              Horizon
 National      Energy                 Seneca
   Fuel      Development,    Upstate  Indep.     NFR    Total Before   Eliminations    Consolidated
Resources,       Inc.        Energy   Pipeline  Power,  Eliminations   & Adjustments   Company and
   Inc.     (Consolidated)    Inc.    Company    Inc.   & Adjustments     (Dr) Cr      Subsidiaries
- ----------  --------------   -------  -------   -----   -------------  -------------   ------------


$133,929      $104,736       $4,644    $  -     $305     $1,547,596      $(122,319)    $1,425,277
- --------      --------       ------    ----     ----     ----------      ---------     ----------


 138,005             -        2,889       -        -        612,768        109,151        503,617

   1,854        53,040            -       -        -         54,893              -         54,893
   5,390        25,015        2,031      18      348        339,705         12,772        326,933
       -            40            -       -        -         23,450              -         23,450

     471         2,593           (3)      -        -         78,878              -         78,878

     209        11,110           54       -       21        142,316            146        142,170
  (4,372)       (1,783)        (208)    240      (14)        77,689            621         77,068
 -------      --------       ------    ----     ----     ----------      ----------    ----------
 141,557        90,015        4,763     258      355      1,329,699        122,690      1,207,009
 -------      --------       ------    ----     ----     ----------      ---------     ----------

  (7,628)       14,721         (119)   (258)     (50)       217,897            371        218,268
 -------      --------       ------    ----     ----     ----------      ---------     ----------




       -             -            -       -        -         57,826        (57,826)             -

       -             -            -       -        -         69,416        (69,416)             -
      14            13            -       -        -         91,972        (91,972)             -
     598         2,285            -   1,406       39         10,425            (17)        10,408
 -------      --------       ------   -----     ----     ----------      ---------     ----------
     612         2,298            -   1,406       39        229,639       (219,231)        10,408
 -------      --------       -------  -----     ----     ----------      ---------     ----------





  (7,016)       17,019         (119)  1,148      (11)       447,536       (218,860)       228,676
 -------      --------       ------   -----     ----     ----------      ---------     ----------




       -         5,198            -       -        -         67,195              -         67,195
     752         5,738          247     701        -         91,972         91,972              -
      22         1,417            -       -       15         33,099            209         32,890
 -------      --------       ------    ----     ----     ----------      ---------     ----------
     774        12,353          247     701       15        192,266         92,181        100,085
 -------      --------       ------    ----     ----     ----------      ---------     ----------


       -        (1,384)           -       -        -         (1,384)             -         (1,384)
 -------      --------       ------    ----     ----     ----------      ---------     ----------



 $(7,790)     $  3,282       $ (366)   $447     $(26)    $  253,886      $(126,679)    $  127,207
 ========     ========       ======    ====     ====     ==========      =========     ==========


Basic Earnings Per Common Share
- -------------------------------
  Net Income Available for Common Stock                                                    $ 3.25
                                                                                           ======

Diluted Earnings Per Common Share
- ---------------------------------
  Net Income Available for Common Stock                                                    $ 3.21
                                                                                           ======

Weighted Average Common Shares Outstanding
- ------------------------------------------
  Used in Basic Calculation                                                            39,116,921
                                                                                       ==========
  Used in Diluted Calculation                                                          39,583,100
                                                                                       ==========







                                            NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                                  CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                           FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                      (THOUSANDS OF DOLLARS)


                                     National   National     Seneca             Highland    Data-Track
                          National   Fuel Gas   Fuel Gas    Resources    Leidy   Forest       Account
                          Fuel Gas Distribution  Supply    Corporation    Hub,  Resources,   Services,
                          Company     Corp.       Corp.   (Consolidated)  Inc.     Inc.        Inc.
                          -------- ------------ --------   ------------ ------- ---------   ----------
EARNINGS REINVESTED
- -------------------
IN THE BUSINESS
- ---------------

Balance at Beginning
  of Year                $472,517    $282,792   $204,777    $(18,776)    $(651)   $3,939       $227

Net Income (Loss)
  Available for
  Common Stock            127,207      57,662     31,167      39,785        (3)    2,497         24

Dividends on Common
  Stock (2000 - $1.89
  per share)              (73,877)    (34,800)   (24,616)     (8,000)        -    (1,600)         -
                         --------    --------   --------    --------     -----    ------       ----

Balance at End of Year   $525,847    $305,654   $211,328    $ 13,009     $(654)   $4,836       $251
                         ========    ========   ========    ========     =====    ======       ====



                    At September 30, 2000
                     ---------------------

Intercompany Eliminations:
- -------------------------

Earnings Reinvested in the Business:
  Unremitted Earnings of Subsidiaries
    Since Acquisition                                  $534,667
  Earnings Reinvested in the Business
    of Subsidiaries at Acquisition                        7,095
  Consolidating Adjustment                              (11,921)
                                                       --------
                                                       $529,841

Net Income Available for Common Stock:
  Subsidiaries-Dividends on
    Common Stock                                       $ 69,416
  Unremitted Earnings of Subsidiaries                    57,826
  Consolidating Adjustment                                 (563)
                                                       --------
                                                       $126,679


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.











              Horizon
 National      Energy                 Seneca    Niagara
   Fuel      Development,    Upstate  Indep.     Indep.     NFR    Total Before   Eliminations    Consolidated
Resources,       Inc.        Energy   Pipeline  Marketing  Power,  Eliminations   & Adjustments   Company and
   Inc.     (Consolidated)    Inc.    Company    Company    Inc.   & Adjustments     (Dr) Cr      Subsidiaries
- ---------   --------------   ------   -------   --------   -----   -------------  -------------   ------------




  $9,723       $ (9,384)      $(450)   $460       $  -     $(79)     $ 945,095      $(472,578)      $472,517



  (7,790)         3,282        (366)    447          -      (26)       253,886       (126,679)       127,207



    (400)             -           -       -          -        -       (143,293)        69,416        (73,877)
  ------       --------       -----    ----       ----    -----     ----------      ---------       --------

  $1,533       $ (6,102)      $(816)   $907       $  -    $(105)    $1,055,688      $(529,841)      $525,847
  ======       ========       =====    ====       ====    =====     ==========      =========       ========



                                  ANALYSIS OF INVESTMENTS IN ASSOCIATED COMPANIES AT SEPTEMBER 30, 2000

                             Par or                   Earnings                                  Total Investment
                          Stated Value              Reinvested in   Unremitted   Accumulated     in Associated
                               of          Paid     the Business     Earnings       Other          Companies
                           Subsidiary       in           at            Since     Comprehensive         at
                              Stock       Capital    Acquisition    Acquisition     Income           Equity
                          ------------    -------   -------------   -----------  -------------  ------------

Registrant:
  Distribution
   Corporation             $59,170       $121,669      $4,636        $301,018      $     -         $486,493
  Supply Corporation        25,345         35,833       2,453         208,875            -          272,506
  Seneca Resources             500        104,035           6          13,003       (4,331)         113,213
  Leidy Hub                      4          1,365           -            (654)           -              715
  Highland                       4          3,005           -           4,836            -            7,845
  Data-Track                     1            499           -             251            -              751
  NFR                           10          3,490           -           1,533            -            5,033
  Horizon                        5         38,246           -          (6,102)     (27,604)           4,545
  Upstate                        1              -           -            (816)           -             (815)
  Seneca Independence            1              -           -             907            -              908
  Niagara Independence           1              -           -               -            -                1
  NFR Power, Inc.                1          5,020           -            (105)           -            4,916
  Consolidating
   Adjustment                    -              -           -          11,921          840           12,761
                           -------       --------      ------        --------      -------         --------
                            85,043        313,162       7,095         534,667      (31,095)         908,872
Supply Corporation:
  Seneca Resources               -             61           -               -            -               61
                           -------       --------      ------        --------     --------         --------
                           $85,043       $313,223      $7,095        $534,667     $(31,095)        $908,933
                           =======       ========      ======        ========     ========         ========







                                              NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                                                CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)


                                          National    National    Seneca             Highland    Data-Track
                               National   Fuel Gas    Fuel Gas   Resources    Leidy   Forest       Account
                               Fuel Gas Distribution   Supply   Corporation   Hub,   Resources,   Services,
                               Company     Corp.       Corp.   (Consolidated)  Inc.     Inc.        Inc.
                               -------- ------------ ---------  ------------  ------ ---------    ---------
OPERATING ACTIVITIES:
- ---------------------
Net Income (Loss) Available
  for Common Stock             $127,207   $ 57,662    $31,167     $39,785      $ (3)  $2,497        $24
Adjustments to Reconcile Net
  Income to Net Cash Provided
  by Operating Activities:
   Unremitted Earnings of
    Subsidiaries                (57,826)         -          -           -         -        -          -
   Dividend Income from
     Subsidiaries               (69,416)         -          -           -         -        -          -
   Depreciation, Depletion
    and Amortization                  2     35,842     23,379      70,591         -    1,086         21
   Deferred Income Taxes           (347)    13,203     (2,864)     28,096        14      (69)       (13)
   Minority Interest in Foreign
    Subsidiaries                      -          -          -           -         -        -          -
   Other                          1,042        309        958      (1,851)        -     (443)         -

Change in:
   Receivables and Unbilled
    Utility Revenue                 151    (12,790)      (166)    (10,311)        -       82         35
   Accounts Receivable-
    Intercompany                 (2,125)      (721)      (361)     (3,293)       (1)    (339)        95
   Gas Stored Underground
    and Material and Supplies         -      1,795      2,003         575         -   (4,001)         -
   Unrecovered Purchased Gas Costs    -    (25,105)         -           -         -        -          -
   Prepayments                       67      6,054        (76)     (4,923)        6    2,013         (5)
   Accounts Payable                 (91)     3,812     (2,664)    (23,409)        -    1,490       (155)
   Amounts Payable to Customers       -      3,649          -           -         -        -          -
   Accounts Payable-Intercompany   (168)       (88)    (1,555)      7,864        15    1,137        183
   Other Accruals and Current
    Liabilities                   2,838    (15,149)      (379)      7,685       (82)     820        (70)
   Other Assets                  (2,606)     7,974      3,104       3,603       139        -          -
   Other Liabilities                505     (4,281)     3,270      (3,703)        2     (328)        47
                               --------   --------    -------    --------      ----   ------        ----

   Net Cash Provided by
    (Used in) Operating
    Activities                 $   (767)  $ 72,166    $55,816    $110,709      $ 90   $3,945       $162
                               --------   --------    -------    --------      ----   -------       ---


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.

(Consolidating Statement of Cash Flows continues on pages 47 and 48)










              Horizon
National       Energy                 Seneca   Niagara
  Fuel      Development,    Upstate   Indep.    Indep.     NFR    Total Before                 Consolidated
Resources,      Inc.        Energy   Pipeline  Marketing  Power,  Eliminations  Eliminations   Company and
  Inc.     (Consolidated)    Inc.    Company    Company    Inc.   & Adjustments & Adjustments  Subsidiaries 
- ---------  --------------   ------   -------   --------   -----   ------------- -------------  ------------


 $(7,790)     $ 3,282      $  (366)   $ 447     $   -     $(26)      $253,886    $(126,679)      $127,207




       -            -            -        -         -        -        (57,826)      57,826              -

       -            -            -        -         -        -        (69,416)      69,416              -

     209       11,110           54        -         -       21        142,316         (146)       142,170
  (1,781)       5,235          (91)     475         -        -         41,858            -         41,858

       -        1,384            -        -         -        -          1,384            -          1,384
      23          541            -   (1,406)        -        -           (827)       5,367          4,540



  (2,970)        (722)         (15)       -         -     (118)       (26,825)           -        (26,825)

  (7,359)           -           97        -         -     (700)       (14,707)      14,707              -

  (7,525)       1,165       (9,675)       -         -        -        (15,664)       1,957        (13,707)
       -            -            -        -         -        -        (25,105)           -        (25,105)
     278           23            -        -         -        -          3,436            -          3,436
   3,356        1,297            -        -         -       19        (16,345)         (27)       (16,372)
       -            -            -        -         -        -          3,649            -          3,649
     (23)         188        7,646       41         -     (281)        14,959      (14,959)             -

   4,234       (6,064)       2,021      (95)        -       36         (4,205)        (437)        (4,642)
     169       (1,510)      (1,359)       -         -      (48)         9,466         (929)         8,537
  (3,116)         536           35        -         -        -         (7,033)        (851)        (7,884)
- --------      -------       ------    -----     -----  -------       --------    ---------       --------



$(22,295)     $16,465      $(1,653)   $(538)    $   -  $(1,097)      $233,001    $   5,245       $238,246
- --------      -------      -------    -----     -----  --------      --------    ---------       --------








                                          NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                                            CONSOLIDATING STATEMENT OF CASH FLOWS
                                         FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                    (THOUSANDS OF DOLLARS)


                                         National    National    Seneca              Highland   Data-Track
                              National   Fuel Gas    Fuel Gas   Resources    Leidy    Forest      Account
                              Fuel Gas Distribution   Supply   Corporation    Hub,  Resources,   Services,
                              Company     Corp.       Corp.   (Consolidated)  Inc.     Inc.        Inc.
                              -------- ------------ ---------  ------------  ------ ----------  ----------

INVESTING ACTIVITIES:
- ---------------------
Capital Expenditures         $       -   $(55,799)  $(33,964)   $(157,199)  $    -  $(12,583)    $ (75)
Investment in Subsidiaries,
  Net of Cash Acquired               -          -          -     (123,809)       -         -         -
Dividends Received from
  Subsidiaries                  69,351          -          -            -        -         -         -
Investment in Associated
  Companies                     (5,000)         -          -            -        -         -         -
Investment in Partnerships           -          -          -            -        -         -         -
Change in Notes
  Receivable - Intercompany   (333,000)         -          -       (7,200)    (100)        -      (100)
Other                                -         52         18       10,015        -       969         -
                             ---------   --------   --------     --------   ------  --------     -----

Net Cash Provided by (Used In)
 Investing  Activities        (268,649)   (55,747)   (33,946)    (278,193)    (100)  (11,614)     (175)
                             ---------   --------   --------    ---------   ------  --------     -----

FINANCING ACTIVITIES:
- ---------------------
Change in Notes Payable to
 Banks and Commercial Paper    208,900          -          -            -        -         -         -
Change in Notes
 Payable-Intercompany            6,000     18,700      3,700      280,200        -     9,300         -
Capital Contribution                 -          -          -            -        -         -         -
Net Proceeds from Issuance of
 Long-Term Debt                149,334          -          -            -        -         -         -
Reduction of Long-Term Debt    (50,000)      (365)      (207)    (101,438)       -         -         -
Proceeds from Issuance of
 Common Stock                   20,756          -          -            -        -         -         -
Dividends Paid on Common Stock (73,046)   (34,800)   (24,616)      (8,000)       -    (1,600)        -
Dividends Paid to Minority
  Interest                           -          -          -            -        -         -         -
                             ---------   --------   --------    ---------   ------  --------     -----

Net Cash Provided by (Used in)
 Financing Activities          261,944    (16,465)   (21,123)     170,762        -     7,700         -
                             ---------   --------   --------    ---------   ------  --------     -----

Effect of Exchange Rates
 on Cash                             -          -          -        3,306        -          -         -
                             ----------  --------   --------    ---------    ------  --------     -----

Net Increase (Decrease) in
 Cash and Temporary Cash
 Investments                    (7,472)       (46)       747       6,584       (10)       31       (13)

Cash and Temporary Cash
 Investments at Beginning
 of Year                         7,528      2,080        219       2,031        96       267        85
                             ---------   --------   --------   ---------    ------  --------     -----

Cash and Temporary Cash
 Investments at End of Year  $      56   $  2,034   $    966   $   8,615    $   86  $    298     $  72
                             =========   ========   ========   =========    ======  ========     =====


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.











              Horizon
National       Energy                 Seneca   Niagara
  Fuel      Development,    Upstate   Indep.    Indep.     NFR    Total Before                 Consolidated
Resources,      Inc.        Energy   Pipeline  Marketing  Power,  Eliminations  Eliminations   Company and
  Inc.     (Consolidated)    Inc.    Company    Company    Inc.   & Adjustments & Adjustments  Subsidiaries
- ---------  --------------   ------   -------   ---------  ------  ------------- -------------  ------------ 


 $  (89)     $ (9,767)     $(1,000)  $      -    $  -    $  (50)    $(270,526)    $   1,155     $(269,371)

      -             -            -          -       -         -      (123,809)            -      (123,809)

      -             -            -          -       -         -        69,351       (69,351)            -

      -             -            -          -       -         -        (5,000)        5,000             -
      -             -            -     (1,842)      -    (2,600)       (4,442)            -        (4,442)

  1,400             -            -          -       -         -      (339,000)      339,000             -
      9         3,361           10          -       -    (1,009)       13,425          (142)       13,283
 ------      --------       ------   --------    ----     -----     ---------     ---------     ---------


  1,320        (6,406)        (990)    (1,842)      -    (3,659)     (660,001)      275,662      (384,339)
 ------      --------       ------   --------    ----     -----     ---------     ---------     ---------



      -        17,577            -          -       -         -       226,477             -       226,477

 33,900       (17,900)       2,700      2,400       -         -       339,000      (339,000)            -
      -             -            -          -       -     5,000         5,000        (5,000)            -

      -             -            -          -       -         -       149,334             -       149,334
      -       (15,416)           -          -       -         -      (167,426)            -      (167,426)

      -             -            -          -       -         -        20,756        (6,478)       14,278
   (335)            -            -          -       -         -      (142,397)       69,351       (73,046)

      -          (152)           -          -       -         -          (152)            -          (152)
 ------      --------       ------   --------    ----     -----     ---------     ---------     ---------

 33,565       (15,891)       2,700      2,400       -     5,000       430,592      (281,127)      149,465
 ------      --------       ------   --------    ----     -----     ---------     ---------     ----------


      -        (3,775)           -          -       -         -          (469)            -          (469)
 ------      --------       ------   --------    ----     -----     ---------     ---------     ---------



 12,590        (9,607)          57         20       -       244         3,123          (220)        2,903



  1,350        15,209            7         69       1        15        28,957           264        29,222
 ------      --------       ------   --------    ----     -----     ---------     ---------     ---------


$13,940      $  5,602       $   64   $     89    $  1     $ 259     $  32,080     $      44     $  32,125
=======      ========       ======   ========    ====     =====     =========     =========     =========






                                             NATIONAL FUEL GAS COMPANY AND SUBSIDIARIES
                                          CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                            FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                       (THOUSANDS OF DOLLARS)


                                         National    National    Seneca             Highland    Data-Track
                              National   Fuel Gas    Fuel Gas   Resources    Leidy   Forest       Account
                              Fuel Gas Distribution   Supply   Corporation    Hub,  Resources,   Services,
                              Company     Corp.       Corp.   (Consolidated)  Inc.     Inc.        Inc.
                              -------- ------------ ---------  ------------  ------ ---------    ---------

Net Income (Loss) Available
 for Common Stock             $127,207   $ 57,662   $ 31,167     $ 39,785     $ (3)  $ 2,497       $ 24
                              --------   --------   --------     --------     ----   -------       ----

Other Comprehensive Income
 (Loss), Before Tax:
  Foreign Currency
    Translation Adjustment     (27,463)         -          -       (4,331)       -         -          -
  Unrealized Gain on
    Securities Available
    for Sale Arising During
    the Period                   2,441          -          -            -        -         -          -
Reclassification Adjustment
 for Gains on Securities
 Available for Sale Realized
 in Net Income                    (103)         -          -            -        -         -          -
                              --------   --------   --------     --------     ----   -------       ----
Other Comprehensive Income
  (Loss), Before Tax           (25,125)         -          -       (4,331)       -         -          -
Income Tax Expense Related
  to Unrealized Gain on
  Securities Available
  for Sale Arising During
  the Period                       855          -          -            -        -         -          -
Reclassification Adjustment
 for Income Tax Expense on
 Gains on Securities
 Available for Sale Realized
 In Net Income                     (36)         -          -            -        -         -          -
                              --------   --------   --------     --------     ----   -------       ----
Income Taxes - Net                 819          -          -            -        -         -          -
                              --------   --------   --------     --------     ----   -------       ----
Other Comprehensive Income
  (Loss), Net of Tax           (25,944)         -          -       (4,331)       -         -          -
                              --------   --------   --------     --------     ----   -------       ----

Comprehensive Income (Loss)   $101,263   $ 57,662   $ 31,167     $ 35,454     $ (3)  $ 2,497       $ 24
                              ========   ========   ========     ========     =====  =======       ====


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.











              Horizon
National       Energy                 Seneca   Niagara
  Fuel      Development,    Upstate   Indep.    Indep.     NFR    Total Before  Eliminations   Consolidated
Resources,      Inc.        Energy   Pipeline  Marketing  Power,  Eliminations  & Adjustments  Company and
  Inc.     (Consolidated)    Inc.    Company    Company    Inc.   & Adjustments    (Dr) Cr     Subsidiaries
- ---------  --------------   ------   -------   --------   -----   ------------- -------------  ------------


$(7,790)     $  3,282       $(366)     $447      $  -     $(26)     $253,886      $(126,679)   $ 127,207
- -------      --------       -----      ----      ----     ----      --------      ---------    ---------




      -       (23,132)          -         -         -        -       (54,926)        27,463      (27,463)



      -             -           -         -         -        -          2,441             -        2,441



      -             -           -         -         -        -           (103)            -         (103)
  -----      --------      ------    ------      ----     ----      ---------     ---------     --------

      -       (23,132)          -         -         -        -        (52,588)       27,463      (25,125)




      -             -           -         -         -        -            855             -          855




      -             -           -         -         -        -            (36)            -          (36)
 ------      --------      ------    ------     -----     ----      ---------     ---------     --------
      -             -           -         -         -        -            819             -          819
 ------      --------      ------    ------     -----     ----      ---------     ---------     --------

      -       (23,132)          -         -         -        -        (53,407)       27,463      (25,944)
 ------      --------      ------    ------      ----     ----      ---------     ---------     --------

$(7,790)     $(19,850)     $ (366)   $  447      $  -     $(26)     $ 200,479     $ (99,216)    $101,263
========     ========      ======    ======      ====     ====      =========     =========     ========






                                                     SENECA RESOURCES CORPORATION
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)


                                         Seneca        National                                  Consolidated
                                        Resources        Fuel        Total Before                 Seneca and
                                       Corporation    Exploration    Eliminations  Eliminations   Subsidiary
                                       -----------    -----------    ------------  ------------   ---------- 

ASSETS
- ------

PROPERTY, PLANT & EQUIPMENT           $1,177 646       $258,738      $1,436,384     $       -     $1,436,384
- ---------------------------
 Less: Accumulated  DD&A                 395,939          9,969         405,908             -        405,908
                                      ----------        -------      ----------     ---------     -----------
                                         781,707        248,769       1,030,476             -      1,030,476
                                      ----------        -------      ----------     ---------     ----------
CURRENT ASSETS:
- --------------
 Cash and Temporary Cash Investments       1,912          6,703           8,615             -          8,615
 Allowance for Uncollectible Accounts        (70)             -             (70)            -            (70)
 Notes Receivable - Intercompany          22,000              -          22,000             -         22,000
 Accounts Receivable                      32,079          6,821          38,900             -         38,900
 Accounts Receivable - Intercompany       11,592              -          11,592        (6,282)         5,310
 Materials and Supplies                      673          3,600           4,273             -          4,273
 Prepayments                              10,894            139          11,033             -         11,033
                                      ----------       --------      ----------     ---------     ----------
                                          79,080         17,263          96,343        (6,282)        90,061
                                      ----------       --------      ----------     ---------     ----------
OTHER ASSETS:
- ------------
 Investment in Associated Company         80,505              -          80,505       (80,505)             -
 Deferred Charges                          2,847            169           3,016             -          3,016
 Notes Receivable - Intercompany         153,087              -         153,087      (153,087)             -
 Other Assets                              1,996              -           1,996             -          1,996
                                      ----------       --------      ----------     ---------     ----------
                                         238,435            169         238,604      (233,592)         5,012
                                      ----------       --------      ----------     ---------     ----------
TOTAL ASSETS                          $1,099,222       $266,201      $1,365,423     $(239,874)    $1,125,549
                                      ==========       ========      ==========     =========     ==========

CAPITALIZATION & LIABILITIES
- ----------------------------

CAPITALIZATION:
- --------------
 Common Stock                         $      500       $      -      $      500     $       -     $      500
 Paid - in - Capital                     104,035         78,445         182,480       (78,445)       104,035
 Earnings Reinvested in the Business      13,009          6,391          19,400        (6,391)        13,009
 Accumulated Other
  Comprehensive Income                    (4,331)        (4,331)         (8,662)        4,331         (4,331)
                                      ----------       --------      ----------     ---------     ----------
 Total Common Stock Equity               113,213         80,505         193,718       (80,505)       113,213

 Long-Term Debt, Net of Current
  Portion                                      -              -               -             -              -
 Notes Payable-Intercompany              420,000        153,087         573,087      (153,087)       420,000
                                      ----------       --------      ----------     ---------     ----------

 Total Capitalization                    533,213        233,592         766,805      (233,592)       533,213
                                      ----------       --------      ----------     ---------     ----------

CURRENT AND ACCRUED LIABILITIES:
- -------------------------------
 Current Portion of Long-Term Debt         1,747              -           1,747             -          1,747
 Accounts Payable                          9,220          8,324          17,544             -         17,544
 Notes Payable - Intercompany            431,300              -         431,300             -        431,300
 Accounts Payable - Intercompany          15,187          6,282          21,469        (6,282)        15,187
 Dividends Payable - Intercompany          2,000              -           2,000             -          2,000
 Other Accruals and Current
   Liabilities                             5,254            294           5,548             -          5,548
                                      ----------       --------      ----------     ---------     ----------
                                         464,708         14,900         479,608        (6,282)       473,326
                                      ----------       --------      ----------     ---------     ----------
DEFERRED CREDITS:
- ----------------
 Accumulated Deferred Income Taxes        94,466         17,676         112,142             -        112,142
 Other Deferred Credits                    6,835             33           6,868             -          6,868
                                      ----------       --------      ----------     ---------     ----------
                                         101,301         17,709         119,010             -        119,010
                                      ----------       --------      ----------     ---------     ----------

TOTAL CAPITALIZATION & LIABILITIES    $1,099,222       $266,201      $1,365,423     $(239,874)    $1,125,549
                                      ==========       ========      ==========     =========     ==========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.





                                                         SENECA RESOURCES CORPORATION
                                                      CONSOLIDATING STATEMENT OF INCOME
                                                 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                              (THOUSANDS OF DOLLARS)



                                          Seneca         National                                   Consolidated
                                         Resources         Fuel       Total Before   Eliminations    Seneca and
                                        Corporation    Exploration    Eliminations      (Dr) Cr      Subsidiary
                                        -----------    -----------    ------------      -------      ----------   

       OPERATING REVENUE:                $220,046         $28,350        $248,396       $     -       $248,396
       -----------------                 --------         -------        --------       -------       --------

       OPERATING EXPENSE:
       -----------------
       Purchased Gas                       16,093               -          16,093             -         16,093
       Operation                           46,985           6,988          53,973             -         53,973
       Maintenance                             28               -              28             -             28
       Property, Franchise & Other Taxes    3,666           2,964           6,630             -          6,630
       Depreciation, Depletion and
         Amortization                      66,269           4,322          70,591             -         70,591
       Income Taxes                        17,476           4,599          22,075             -         22,075
                                         --------         -------        --------       -------       --------
                                          150,517          18,873         169,390             -        169,390
                                         --------         -------        --------       -------       --------
       Operating Income (Loss)             69,529           9,477          79,006             -         79,006
                                         --------         -------        --------       -------       --------

       OTHER INCOME:
       ------------
       Unremitted Earnings of
         Subsidiary                         6,391               -           6,391        (6,391)             -
       Interest - Intercompany              4,106               -           4,106        (2,893)         1,213
       Other                                2,786              65           2,851             -          2,851
                                         --------         -------        --------       -------        -------

                                           13,283              65          13,348        (9,284)         4,064
                                         --------         -------        --------       -------        -------

       Income (Loss) Before
         Interest Charges and
         Minority Interest in
         Foreign Subsidiary                82,812           9,542          92,354        (9,284)        83,070
                                         --------         -------         -------       -------        -------

       INTEREST CHARGES:
       ----------------
       Interest on Long-Term Debt             216               -             216             -            216
       Interest - Intercompany             42,234           2,893          45,127         2,893         42,234
       Other Interest                         577             258             835             -            835
                                         --------         -------         -------       -------        -------
                                           43,027           3,151          46,178         2,893         43,285
                                         --------         -------         -------       -------        -------

       Net Income (Loss) Available
         for Common Stock                $ 39,785         $ 6,391         $46,176       $(6,391)       $39,785
                                         ========         =======         =======       =======        =======



       See Notes to  Consolidated  Financial  Statements  included  in Item 8 of
       National Fuel Gas Company's Form 10-K for the fiscal year ended September
       30, 2000, incorporated herein by reference.






                                                     SENECA RESOURCES CORPORATION.
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)


                                    Seneca        National                                     Consolidated
EARNINGS REINVESTED                Resources        Fuel         Total Before   Eliminations    Seneca and
IN THE BUSINESS                   Corporation    Exploration     Eliminations      (Dr) Cr      Subsidiary
- -------------------               ------------   ------------    ------------   ------------   ---------------

Balance at Beginning of Year       $(18,776)       $     -         $(18,776)      $     -       $(18,776)


Net Income (Loss) Available
  for Common Stock                   39,785          6,391           46,176        (6,391)        39,785


Dividends on Common Stock            (8,000)             -           (8,000)            -         (8,000)
                                   --------        -------         --------       -------       --------


Balance at End of Year             $ 13,009        $ 6,391         $ 19,400       $(6,391)      $ 13,009
                                   ========        =======         ========       =======       ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                                     SENECA RESOURCES CORPORATION
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                         Seneca       National      Total Before   Eliminations  Consolidated
                                       Resources        Fuel        Eliminations       and        Seneca and
                                      Corporation    Exploration    & Adjustments  Adjustments    Subsidiary
                                      -----------    -----------    -------------  -----------    ----------  
CASH FLOWS FROM OPERATING ACTIVITIES:
- ------------------------------------
Net Income (Loss)                     $  39,785        $   6,391      $  46,176     $  (6,391)    $  39,785
Adjustments to Reconcile Net Income
  to Net Cash Provided by Operating
  Activities:
 Unremitted Earnings of Subsidiary       (6,391)               -         (6,391)        6,391             -
 Depreciation, Depletion &
  Amortization                           66,269            4,322         70,591             -        70,591
 Deferred Income Taxes                   23,780            4,316         28,096             -        28,096
 Other                                   (1,851)               -         (1,851)            -        (1,851)

Change in:
 Receivables and Unbilled Utility
  Revenue                               (10,658)             347        (10,311)            -       (10,311)
 Accounts Receivable - Intercompany      (9,575)               -         (9,575)        6,282        (3,293)
 Materials and Supplies                     575                -            575             -           575
 Prepayments                             (5,451)             528         (4,923)            -        (4,923)
 Accounts Payable                        (7,135)         (16,649)       (23,784)          375       (23,409)
 Accounts Payable - Intercompany          7,864            6,658         14,522        (6,658)        7,864
 Other Accruals and Current
  Liabilities                             7,327              358          7,685             -         7,685
 Other Assets                             3,603                -          3,603             -         3,603
 Other Liabilities                       (3,715)              12         (3,703)            -        (3,703)
                                      ---------         --------      ---------     ---------     ---------

Net Cash Provided by
  Operating Activities                  104,427            6,283        110,710            (1)      110,709
                                      ---------        ---------      ---------     ---------     ---------

CASH FLOWS FROM INVESTING ACTIVITIES:
- ------------------------------------
Capital Expenditures                   (145,568)         (11,631)      (157,199)            -      (157,199)
Investment in Subsidiaries,
  Net of Cash Acquired                        -         (123,816)      (123,816)            7      (123,809)
Change in Notes
  Receivable - Intercompany            (160,287)               -       (160,287)      153,087        (7,200)
Investment in Associated Company        (78,445)               -        (78,445)       78,445             -
Other                                     9,768              247         10,015             -        10,015
                                      ---------        ---------      ---------     ---------     ---------
Net Cash Used in Investing
  Activities                           (374,532)        (135,200)      (509,732)      231,539      (278,193)
                                      ---------        ---------      ---------     ---------     ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
- ------------------------------------
Change in Notes Payable - Intercompany  280,200          153,087        433,287      (153,087)      280,200
Reduction of Long-Term Debt              (2,213)         (99,225)      (101,438)            -      (101,438)
Dividends Paid on Common Stock           (8,000)               -         (8,000)            -        (8,000)
Capital Contribution                          -           78,445         78,445       (78,445)            -
                                       --------           ------         ------     ---------     ---------

Net Cash Provided by Financing
  Activities                            269,987          132,307        402,294      (231,532)      170,762
                                      ---------        ---------      ---------     ---------     ---------

Effect of Exchange Rates on Cash              -            3,306          3,306             -         3,306
                                      ---------        ---------      ---------     ---------     ---------

Net Increase (Decrease) in Cash
  and Temporary Cash Investments           (118)           6,696          6,578             6         6,584

Cash and Temporary Cash Investments
  at Beginning of Period                  2,030                7          2,037            (6)        2,031
                                      ---------        ---------      ---------     ---------     ---------

Cash and Temporary Cash Investments
  at End of Period                    $   1,912        $   6,703      $   8,615     $       -     $   8,615
                                      =========        =========      =========     =========     =========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                                     SENECA RESOURCES CORPORATION
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)


                                    Seneca        National                                     Consolidated
EARNINGS REINVESTED                Resources        Fuel         Total Before                   Seneca and
IN THE BUSINESS                   Corporation    Exploration     Eliminations   Eliminations    Subsidiary
- -------------------               ------------   ------------    ------------   ------------   ---------------

Net Income Available for
  Common Stock                     $ 39,785        $ 6,391         $ 46,176       $(6,391)      $ 39,785


Other Comprehensive Income (Loss):
  Foreign Currency Translation
    Adjustment                       (4,331)        (4,331)          (8,662)        4,331         (4,331)
                                   --------        -------         --------       -------       --------

Other Comprehensive Income (Loss)    (4,331)        (4,331)          (8,662)        4,331         (4,331)
                                   --------        -------         --------       -------       --------


Comprehensive Income (Loss)        $ 35,454        $ 2,060         $ 37,514       $(2,060)      $ 35,454
                                   ========        =======         ========       =======       ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.





                                           HORIZON ENERGY DEVELOPMENT, INC. AND SUBSIDIARIES
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                          Horizon        Horizon
                                          Energy         Energy      Sceptre                              Consolidated
                                       Development,     Holdings      Power   Total Before                Horizon and
                                           Inc.      (Consolidated)  Company  Eliminations  Eliminations  Subsidiaries
                                       ------------  --------------  -------  ------------  ------------  ------------

ASSETS
- ------

PROPERTY, PLANT & EQUIPMENT             $      -       $249,074      $     -    $249,074      $       -     $249,074
- ---------------------------
 Less: Accumulated  DD&A                       -         76,472            -      76,472              -       76,472
                                        --------       --------      -------    --------      ---------     ---------
                                               -        172,602            -     172,602              -      172,602
                                        --------       --------      -------    --------      ---------     --------
CURRENT ASSETS:
- --------------
 Cash and Temporary Cash Investments          49          5,542           11       5,602              -        5,602
 Allowance for Uncollectible Accounts          -           (574)           -        (574)             -         (574)
 Accounts Receivable - Intercompany        2,785              -            -       2,785         (2,785)           -
 Accounts Receivable                           -          6,455           10       6,465              -        6,465
 Unbilled Utility Revenue                      -          2,846            -       2,846              -        2,846
 Materials and Supplies                        -          4,873            -       4,873              -        4,873
 Prepayments                                   -             64            -          64              -           64
                                        --------       --------      -------    --------      ---------     --------
                                           2,834         19,206           21      22,061         (2,785)      19,276
                                        --------       --------      -------    --------      ---------     --------
OTHER ASSETS:
- ------------
 Investment in Associated Companies      105,702              -            -     105,702       (105,702)           -
 Other Assets                                  -         10,672            -      10,672              -       10,672
 Notes Receivable - Intercompany               -              -            -           -              -            -
 Deferred Charges                             72              -            -          72              -           72
                                        --------       --------      -------    --------      ---------     --------
                                         105,774         10,672            -     116,446       (105,702)      10,744
                                        --------       --------      -------    --------      ---------     --------
TOTAL ASSETS                            $108,608       $202,480      $    21    $311,109      $(108,487)    $202,622
                                        ========       ========      =======    ========      =========     ========

CAPITALIZATION & LIABILITIES
- ----------------------------

CAPITALIZATION:
- --------------
 Common Stock                           $      5       $      2      $     -    $      7      $      (2)    $      5
 Paid - in - Capital                      38,246        114,957            -     153,203       (114,957)      38,246
 Capital Contribution from Horizon             -              -       11,524      11,524        (11,524)           -
 Earnings Reinvested in the Business      (6,102)        13,757       (7,576)         79         (6,181)      (6,102)
 Accumulated Other Comprehensive Income  (27,604)       (26,962)           -     (54,566)        26,962      (27,604)
                                        --------       --------      -------    --------      ---------     --------
Total Common Stock Equity                  4,545        101,754        3,948     110,247       (105,702)       4,545
                                        --------       --------      -------    --------      ---------     --------
 Long-Term Debt, Net of Current
  Portion                                      -         29,364            -      29,364              -       29,364
 Notes Payable-Intercompany               90,000              -            -      90,000              -       90,000
                                        --------       --------      -------    --------      ---------     --------

Total Capitalization                      94,545        131,118        3,948     229,611       (105,702)     123,909
                                        --------       --------      -------    --------      ---------     --------
Minority Interest in Foreign
  Subsidiaries                                 -         23,031            -      23,031              -       23,031
                                        --------       --------      -------    --------      ---------     --------

CURRENT AND ACCRUED LIABILITIES:
- -------------------------------
 Notes Payable - Intercompany              8,700              -            -       8,700              -        8,700
 Notes Payable to Banks                        -         18,302            -      18,302              -       18,302
 Current Portion of Long-Term Debt             -          8,540            -       8,540              -        8,540
 Accounts Payable                            113          9,640           15       9,768            (77)       9,691
 Accounts Payable - Intercompany           3,378          2,708            -       6,086         (2,708)       3,378
 Other Accruals and Current
   Liabilities                             1,732           (885)      (3,923)     (3,076)             -       (3,076)
                                        --------       --------      -------    --------      ---------     --------
                                          13,923         38,305       (3,908)     48,320         (2,785)      45,535
                                        --------       --------      -------    --------      ---------     --------
DEFERRED CREDITS:
- ----------------
 Accumulated Deferred Income Taxes          (740)        10,026          (20)      9,266              -        9,266
 Other Deferred Credits                      880              -            1         881              -          881
                                        --------       --------      -------    --------      ---------     --------
                                             140         10,026          (19)     10,147              -       10,147
                                        --------       --------      -------    --------      ---------     --------

TOTAL CAPITALIZATION & LIABILITIES      $108,608       $202,480      $    21    $311,109      $(108,487)    $202,622
                                        ========       ========      =======    ========      =========     ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.





                                           HORIZON ENERGY DEVELOPMENT, INC. AND SUBSIDIARIES
                                                   CONSOLIDATING STATEMENT OF INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)


                                 Horizon
                                  Energy       Horizon Energy    Sceptre                              Consolidated
                                Development,     Holdings         Power   Total Before  Eliminations  Horizon and
                                    Inc.      (Consolidated)     Company  Eliminations     (Dr) Cr    Subsidiaries
                                -----------   --------------     -------  ------------  ------------  ------------

OPERATING REVENUE:                $    73        $104,784        $     -    $104,857      $  (121)      $104,736
- -----------------                 -------        --------        -------    --------      -------       --------

OPERATING EXPENSE:
- -----------------
Fuel Used in Heat and
  Electric Generation                   -          53,040              -      53,040            -         53,040
Operation                           2,488          22,648              -      25,136          121         25,015
Maintenance                             -              40              -          40            -             40
Property, Franchise & Other Taxes      19           2,574              -       2,593            -          2,593
Depreciation, Depletion and
  Amortization                         (6)         11,116              -      11,110            -         11,110
Income Taxes                       (2,734)            951              -      (1,783)           -         (1,783)
                                  -------        --------        -------    --------      -------       --------
                                     (233)         90,369              -      90,136          121         90,015
                                  -------        --------        -------    --------      -------       --------
Operating Income (Loss)               306          14,415              -      14,721            -         14,721
                                  -------        --------        -------    --------      -------       --------

OTHER INCOME:
- ------------
Unremitted Earnings of
  Subsidiaries                      8,468               -              -       8,468       (8,468)             -
Interest-Intercompany               1,066               -              -       1,066       (1,053)            13
Other                                 500           1,785              -       2,285            -          2,285
                                  -------        --------        -------    --------      -------       --------

                                   10,034           1,785              -      11,819       (9,521)         2,298
                                  -------        --------        -------    --------      -------       --------

Income (Loss) Before
  Interest Charges and
  Minority Interest in
  Foreign Subsidiaries             10,340          16,200              -      26,540       (9,521)        17,019
                                  -------        --------        -------    --------      -------       --------

INTEREST CHARGES:
- ----------------
Interest on Long-Term Debt              -           5,198              -       5,198            -          5,198
Interest-Intercompany               5,738           1,053              -       6,791        1,053          5,738
Other Interest                      1,320              97              -       1,417            -          1,417
                                  -------        --------        -------    --------      -------       --------
                                    7,058           6,348              -      13,406        1,053         12,353
                                  -------        --------        -------    --------      -------       --------
Minority Interest in
  Foreign Subsidiaries                  -          (1,384)             -      (1,384)           -         (1,384)
                                  -------        --------        -------    --------      -------       --------

Net Income (Loss) Available
  for Common Stock                $ 3,282        $  8,468        $     -    $ 11,750      $(8,468)      $  3,282
                                  =======        ========        =======    ========      =======       ========



See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                           HORIZON ENERGY DEVELOPMENT, INC. AND SUBSIDIARIES
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                    Horizon
                                     Energy     Horizon Energy   Sceptre                                Consolidated
EARNINGS REINVESTED               Development,     Holdings       Power     Total Before  Eliminations  Horizon and
IN THE BUSINESS                       Inc.      (Consolidated)   Company    Eliminations     (Dr) Cr    Subsidiaries
- -------------------               ------------  --------------   -------    ------------  ------------  ------------

Balance at Beginning of Year       $ (9,384)       $ 5,289       $(7,576)     $(11,671)      $ 2,287      $ (9,384)


Net Income (Loss) Available
 for Common Stock                     3,282          8,468             -        11,750        (8,468)        3,282
                                   --------        -------       -------      --------       -------      --------


Balance at End of Year             $ (6,102)       $13,757       $(7,576)     $     79       $(6,181)     $ (6,102)
                                   ========        =======       =======      ========       ========     ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                           HORIZON ENERGY DEVELOPMENT, INC. AND SUBSIDIARIES
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                        Horizon
                                         Energy     Horizon Energy  Sceptre  Total Before   Eliminations  Consolidated
                                      Development,     Holdings      Power   Eliminations       and       Horizon and
                                          Inc.      (Consolidated)   Company  & Adjustments  Adjustments  Subsidiaries
                                      ------------  --------------   -------  -------------  -----------  ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
- ------------------------------------
Net Income (Loss)                     $  3,282         $  8,468      $  -      $ 11,750      $ (8,468)      $  3,282
Adjustments to Reconcile Net Income
  to Net Cash Provided by Operating
  Activities:
 Unremitted Earnings of Subsidiaries    (8,468)               -         -        (8,468)        8,468              -
 Depreciation, Depletion &
  Amortization                              (6)          11,116         -        11,110             -         11,110
 Deferred Income Taxes                    (208)           5,443         -         5,235             -          5,235
 Minority Interest in Foreign
  Subsidiaries                               -            1,384         -         1,384             -          1,384
 Other                                       -              541         -           541             -            541

Change in:
 Accounts Receivable - Intercompany      2,048                -         -         2,048        (2,048)            -
 Receivables and Unbilled Utility
  Revenue                                    -             (722)        -          (722)            -           (722)
 Materials and Supplies                      -            1,165         -         1,165             -          1,165
 Prepayments                                 -               23         -            23             -             23
 Accounts Payable                            2              952         -           954           343          1,297
 Accounts Payable - Intercompany           188           (1,705)        -        (1,517)        1,705            188
 Other Accruals and Current
  Liabilities                           (1,504)          (4,560)        -        (6,064)            -         (6,064)
 Other Assets                              (86)          (1,424)        -        (1,510)            -         (1,510)
 Other Liabilities                         560              (24)        -           536             -            536
                                      --------          -------      ----      --------      --------       --------

Net Cash Provided by (Used in)
  Operations                            (4,192)          20,657         -        16,465             -         16,465
                                      --------         --------      ----      --------      --------       --------

CASH FLOWS FROM INVESTING ACTIVITIES:
- ------------------------------------
Capital Expenditures                         -           (9,767)        -        (9,767)            -         (9,767)
Change in Notes
  Receivable - Intercompany             22,100                -         -        22,100       (22,100)             -
Investment in Associated Companies          12                -         -            12           (12)             -
Other                                        -            3,361         -         3,361             -          3,361
                                      --------         --------      ----      --------      --------       --------
Net Cash Provided by (Used in)
  Investing Activities                  22,112           (6,406)        -        15,706       (22,112)        (6,406)
                                      --------         --------      ----      --------      --------       --------

CASH FLOWS FROM FINANCING ACTIVITIES:
- ------------------------------------
Change in Notes Payable to Banks             -           17,577         -        17,577             -         17,577
Change in Notes Payable - Intercompany (17,900)         (22,100)        -       (40,000)       22,100        (17,900)
Return of Capital Contribution               -                -       (12)          (12)           12              -
Reduction of Long-Term Debt                  -          (15,416)        -       (15,416)            -        (15,416)
Dividends Paid to Minority Interest          -             (152)        -          (152)            -           (152)
                                      --------         --------      ----      --------      --------      ---------

Net Cash Provided by (Used in)
  Financing Activities                 (17,900)         (20,091)      (12)      (38,003)       22,112        (15,891)
                                      --------         --------      ----      --------      --------      ---------

Effect of Exchange Rates on Cash             -           (3,775)        -        (3,775)            -         (3,775)
                                      --------         --------      ----      --------      --------       --------

Net Increase (Decrease) in Cash
  and Temporary Cash Investments            20           (9,615)      (12)       (9,607)            -         (9,607)

Cash and Temporary Cash Investments
  at Beginning of Period                    29           15,157        23        15,209             -         15,209
                                      --------         --------      ----      --------      --------       --------

Cash and Temporary Cash Investments
  at End of Period                    $     49         $  5,542      $ 11      $  5,602      $      -       $  5,602
                                      ========         ========      ====      ========      ========       ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                           HORIZON ENERGY DEVELOPMENT, INC. AND SUBSIDIARIES
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                      Horizon
                                       Energy     Horizon Energy  Sceptre   Total Before                 Consolidated
                                    Development,     Holdings      Power    Eliminations   Eliminations  Horizon and
                                        Inc.      (Consolidated)   Company  & Adjustments     (Dr) Cr    Subsidiaries
                                    ------------  --------------  --------  -------------  ------------  ------------

Net Income (Loss) Available for
  Common Stock                        $  3,282      $  8,468        $   -     $ 11,750      $ (8,468)     $  3,282
                                      --------      --------        -----     --------      --------      --------

Other Comprehensive Income (Loss):
  Foreign Currency Translation
    Adjustment                         (23,132)      (23,132)           -      (46,264)       23,132       (23,132)
                                      --------      --------        -----     --------       -------      --------
Other Comprehensive Income (Loss)      (23,132)      (23,132)           -      (46,264)       23,132       (23,132)
                                      --------      --------        -----     --------       -------      --------

Comprehensive Income (Loss)           $(19,850)     $(14,664)       $   -     $(34,514)      $14,664      $(19,850)
                                      --------      --------        -----     --------       -------      --------


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.







                                                        HORIZON ENERGY HOLDINGS
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                   Consolidated
                                          Horizon     Horizon Energy                                  Horizon
                                           Energy    Development B.V.  Total Before                Energy Holdings
                                          Holdings    (Consolidated)   Eliminations  Eliminations  and Subsidiaries
                                          --------    --------------   ------------  ------------  ----------------

ASSETS
- ------

PROPERTY, PLANT & EQUIPMENT                $      -      $249,074        $249,074     $       -        $249,074
- ---------------------------
 Less: Accumulated  DD&A                          -        76,472          76,472             -          76,472
                                           --------      --------        --------     ---------        ---------
                                                  -       172,602         172,602             -         172,602
                                           --------      --------        --------     ---------        --------
CURRENT ASSETS:
- --------------
 Cash and Temporary Cash Investments              -         5,542           5,542             -           5,542
 Allowance for Uncollectible Accounts             -          (574)           (574)            -            (574)
 Accounts Receivable                              -         6,455           6,455             -           6,455
 Unbilled Utility Revenue                         -         2,846           2,846             -           2,846
 Materials and Supplies                           -         4,873           4,873             -           4,873
 Prepayments                                      -            64              64             -              64
                                           --------      --------        --------     ---------        --------
                                                  -        19,206          19,206             -          19,206
                                           --------      --------        --------     ---------        --------
OTHER ASSETS:
- ------------
 Investment in Associated Companies         101,754             -         101,754      (101,754)              -
 Other Assets                                     -        10,672          10,672             -          10,672
                                           --------      --------        --------     ---------        --------
                                            101,754        10,672         112,426      (101,754)         10,672
                                           --------      --------        --------     ---------        --------
TOTAL ASSETS                               $101,754      $202,480        $304,234     $(101,754)       $202,480
                                           ========      ========        ========     =========        ========

CAPITALIZATION & LIABILITIES
- ----------------------------

CAPITALIZATION:
- --------------
 Common Stock                              $      2      $     29        $     31     $     (29)       $      2
 Paid - in - Capital                        114,957       109,822         224,779      (109,822)        114,957
 Earnings Reinvested in the Business         13,757        19,507          33,264       (19,507)         13,757
 Accumulated Other Comprehensive
  Income (Loss)                             (26,962)      (27,604)        (54,566)       27,604         (26,962)
                                           --------      --------        --------     ---------        --------
 Total Common Stock Equity                  101,754       101,754         203,508      (101,754)        101,754

 Long-Term Debt, Net of Current
  Portion                                         -        29,364          29,364             -          29,364
 Notes Payable - Intercompany                     -             -               -             -               -
                                           --------      --------        --------     ---------        --------

 Total Capitalization                       101,754       131,118         232,872      (101,754)        131,118
                                           --------      --------        --------     ---------        --------
Minority Interest in Foreign
  Subsidiaries                                    -        23,031          23,031             -          23,031
                                           --------      --------        --------     ---------        --------

CURRENT AND ACCRUED LIABILITIES:
- -------------------------------
 Notes Payable to Banks                           -        18,302          18,302             -          18,302
 Current Portion of Long-Term Debt                -         8,540           8,540             -           8,540
 Accounts Payable                                 -         9,640           9,640             -           9,640
 Accounts Payable - Intercompany                  -         2,708           2,708             -           2,708
 Other Accruals and Current
   Liabilities                                    -          (885)           (885)            -            (885)
                                           --------      --------        --------     ---------        --------
                                                  -        38,305          38,305             -          38,305
                                           --------      --------        --------     ---------        --------
DEFERRED CREDITS:
- ----------------
 Accumulated Deferred Income Taxes                -        10,026          10,026             -          10,026
 Other Deferred Credits                           -             -               -             -               -
                                           --------      --------        --------     ---------        --------
                                                  -        10,026          10,026             -          10,026
                                           --------      --------        --------     ---------        --------

TOTAL CAPITALIZATION & LIABILITIES         $101,754      $202,480        $304,234     $(101,754)       $202,480
                                           ========      ========        ========     ==========       ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.





                                                        HORIZON ENERGY HOLDINGS
                                                   CONSOLIDATING STATEMENT OF INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                                              Consolidated
                                 Horizon        Horizon Energy                                Horizon Energy
                                  Energy       Development B.V.   Total Before  Eliminations  Holdings and
                                 Holdings       (Consolidated)    Eliminations     (Dr) Cr    Subsidiaries
                                 --------       --------------    ------------     -------    -------------- 

OPERATING REVENUE:                $     -         $104,784          $104,784      $     -       $104,784
- -----------------                 -------         --------          --------      -------       --------

OPERATING EXPENSE:
- -----------------
Fuel Used in Heat and
  Electric Generation                   -           53,040            53,040            -         53,040
Operation                               -           22,648            22,648            -         22,648
Maintenance                             -               40                40            -             40
Property, Franchise & Other Taxes       -            2,574             2,574            -          2,574
Depreciation, Depletion and
  Amortization                          -           11,116            11,116            -         11,116
Income Taxes                            -              951               951            -            951
                                  -------         --------          --------      -------       --------
                                        -           90,369            90,369            -         90,369
                                  -------         --------          --------      -------       --------
Operating Income (Loss)                 -           14,415            14,415            -         14,415
                                  -------         --------          --------      -------       --------

OTHER INCOME:
- ------------
Unremitted Earnings of
  Subsidiaries                      8,468                -             8,468       (8,468)             -
Other                                   -            1,785             1,785            -          1,785
                                  -------         --------          --------      -------       --------

                                    8,468            1,785            10,253       (8,468)         1,785
                                  -------         --------          --------      -------       --------

Income (Loss) Before
  Interest Charges and
  Minority Interest in
  Foreign Subsidiaries              8,468           16,200            24,668       (8,468)        16,200
                                  -------         --------          --------      -------       --------

INTEREST CHARGES:
- ----------------
Interest on Long-Term Debt              -            5,198             5,198            -          5,198
Interest-Intercompany                   -            1,053             1,053            -          1,053
Other Interest                          -               97                97            -             97
                                  -------         --------          --------      -------       --------
                                        -            6,348             6,348            -          6,348
                                  -------         --------          --------      -------       --------
Minority Interest in
  Foreign Subsidiaries                  -           (1,384)           (1,384)           -         (1,384)
                                  -------         --------          --------      -------       --------

Net Income (Loss) Available
  for Common Stock                $ 8,468         $  8,468          $ 16,936      $(8,468)      $  8,468
                                  =======         ========          ========      =======       ========



See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.





                                                        HORIZON ENERGY HOLDINGS
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                Consolidated
                                   Horizon        Horizon Energy                                Horizon Energy
   EARNINGS REINVESTED              Energy       Development B.V.   Total Before  Eliminations  Holdings and
   IN THE BUSINESS                 Holdings       (Consolidated)    Eliminations     (Dr) Cr    Subsidiaries
   ---------------                -----------   -----------------   ------------  ------------  -------------- 

Balance at Beginning of Year     $ 5,289          $11,039          $ 16,328      $(11,039)     $  5,289


Net Income (Loss) Available
 for Common Stock                  8,468            8,468            16,936        (8,468)        8,468
                                 -------          -------          --------      --------      --------


Balance at End of Year           $13,757          $19,507          $ 33,264      $(19,507)     $ 13,757
                                 =======          =======          ========      ========      ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                                        HORIZON ENERGY HOLDINGS
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                   Consolidated
                                        Horizon     Horizon Energy    Total Before                 Horizon Energy
                                         Energy     Development B.V.  Eliminations                 Holdings and
                                        Holdings     (Consolidated)   & Adjustments  Eliminations  Subsidiaries
                                        --------     --------------   -------------  ------------  -------------- 
CASH FLOWS FROM OPERATING ACTIVITIES:
- ------------------------------------
Net Income (Loss)                     $  8,468         $  8,468         $ 16,936      $ (8,468)      $  8,468
Adjustments to Reconcile Net Income
  to Net Cash Provided by Operating
  Activities:
 Unremitted Earnings of Subsidiaries    (8,468)               -           (8,468)        8,468              -
 Depreciation, Depletion &
  Amortization                               -           11,116           11,116             -         11,116
 Deferred Income Taxes                       -            5,443            5,443             -          5,443
 Minority Interest in Foreign
  Subsidiaries                               -            1,384            1,384             -          1,384
 Other                                       -              541              541             -            541

Change in:
 Receivables and Unbilled Utility
  Revenue                                    -             (722)            (722)            -           (722)
 Materials and Supplies                      -            1,165            1,165             -          1,165
 Prepayments                                 -               23               23             -             23
 Accounts Payable                            -              952              952             -            952
 Accounts Payable - Intercompany             -           (1,705)          (1,705)            -         (1,705)
 Other Accruals and Current
  Liabilities                                -           (4,560)          (4,560)            -         (4,560)
 Other Assets                                -           (1,424)          (1,424)            -         (1,424)
 Other Liabilities                           -              (24)             (24)            -            (24)
                                      --------          -------         --------      --------       --------

Net Cash Provided by (Used in)
  Operations                                 -           20,657           20,657             -         20,657
                                      --------         --------         --------      --------       --------

CASH FLOWS FROM INVESTING ACTIVITIES:
- ------------------------------------
Capital Expenditures                         -           (9,767)          (9,767)            -         (9,767)
Other                                        -            3,361            3,361             -          3,361
                                      --------         --------         --------      --------       --------
Net Cash Provided by (Used in)
  Investing Activities                       -           (6,406)          (6,406)            -         (6,406)
                                      --------         --------         --------      --------       --------

CASH FLOWS FROM FINANCING ACTIVITIES:
- ------------------------------------
Change in Notes Payable to Banks             -           17,577           17,577             -         17,577
Change in Notes Payable-Intercompany         -          (22,100)         (22,100)            -        (22,100)
Reduction of Long-Term Debt                  -          (15,416)         (15,416)            -        (15,416)
Dividends Paid to Minority Interest          -             (152)            (152)            -           (152)
                                      --------         --------         --------      --------      ---------

Net Cash Provided by (Used in)
  Financing Activities                       -          (20,091)         (20,091)            -        (20,091)
                                      --------         --------         --------      --------       --------

Effect of Exchange Rates on Cash             -           (3,775)          (3,775)            -         (3,775)
                                      --------         --------         --------      --------       --------

Net Increase (Decrease) in Cash
  and Temporary Cash Investments             -           (9,615)          (9,615)            -         (9,615)

Cash and Temporary Cash Investments
  at Beginning of Period                     -           15,157           15,157             -         15,157
                                      --------         --------         --------      --------       --------

Cash and Temporary Cash Investments
  at End of Period                    $      -         $  5,542         $  5,542      $      -       $  5,542
                                      ========         ========         ========      ========       ========


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.






                                                        HORIZON ENERGY HOLDINGS
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                    Consolidated
                                       Horizon       Horizon Energy    Total Before                 Horizon Energy
                                        Energy      Development B.V.   Eliminations   Eliminations  Holdings and
                                       Holdings      (Consolidated)    & Adjustments     (Dr) Cr    Subsidiaries
                                       --------      --------------    -------------     -------    --------------- 

Net Income Available for
  Common Stock                          $  8,468        $  8,468         $ 16,936      $(8,468)      $  8,468
                                        --------        --------         --------      -------       --------

Other Comprehensive Income (Loss):
  Foreign Currency Translation
    Adjustment                           (23,132)        (23,132)         (46,264)      23,132        (23,132)
                                        --------        --------         --------      -------       --------
Other Comprehensive Income (Loss)        (23,132)        (23,132)         (46,264)      23,132        (23,132)
                                        --------        --------         --------      -------       --------

Comprehensive Income (Loss)             $(14,664)       $(14,664)        $(29,328)     $14,664       $(14,664)
                                        --------        --------         --------      -------       --------


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.







                                                   HORIZON ENERGY DEVELOPMENT, B.V.
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)


                                                     United
                                                  Energy, a.s.       Power
                                                      (UE)         Development        Horizon Energy
                                   Horizon B.V.  (Consolidated)   (Consolidated)    Development, s.r.o.
                                   ------------  --------------   --------------    ------------------- 

ASSETS
- ------

PROPERTY, PLANT & EQUIPMENT         $      -       $247,938           $  917            $  219
- ---------------------------
 Less:  Accumulated DD&A                   -         76,123              194               155
                                    --------       --------           ------            ------
                                           -        171,815              723                64
                                    --------       --------           ------            ------
CURRENT ASSETS:
- --------------
 Cash and Temporary Cash Investments     112          4,153               28             1,249
 Allowance for Uncollectible Accounts      -           (574)               -                 -
 Notes Receivable - Intercompany           -              -                -               142
 Accounts Receivable - Intercompany       60              -                -               140
 Accounts Receivable                       -          6,144              269                42
 Unbilled Utility Revenue                  -          2,846                -                 -
 Materials and Supplies                    -          4,873                -                 -
 Prepayments                               -             37                2                25
                                    --------       --------           ------            ------
                                         172         17,479              299             1,598
                                    --------       --------           ------            ------

OTHER ASSETS:
- ------------
 Investment in Associated Companies  103,984              -                -                 -
 Other                                   103          9,493              702               374
                                    --------       --------           ------            ------
                                     104,087          9,493              702               374
                                    --------       --------           ------            ------
TOTAL ASSETS                        $104,259       $198,787           $1,724            $2,036
                                    ========       ========           ======            ======

CAPITALIZATION & LIABILITIES
- ----------------------------

CAPITALIZATION:
- --------------
 Common Stock                       $     29       $ 59,770           $  760            $1,779
 Paid - in - Capital                 109,822         50,620            1,562                 -
 Earnings Reinvested in
   the Business                       19,507         17,017             (426)              545
Accumulated Other Comprehensive
  Income                             (27,604)       (26,627)            (656)             (360)
                                    --------       --------           ------            ------
Total Common Stock Equity            101,754        100,780            1,240             1,964

Long-Term Debt, Net of Current
 Portion                                   -         29,364                -                 -
                                    --------       --------           ------            ------

Total Capitalization                 101,754        130,144            1,240             1,964
                                    --------       --------           ------            ------

Minority Interest in Foreign
 Subsidiaries                              -         23,031                -                 -
                                    --------       --------           ------            ------

CURRENT AND ACCRUED LIABILITIES:
- -------------------------------
 Notes Payable to Banks                    -         18,302                -                 -
 Notes Payable - Intercompany              -              -              142                 -
 Current Portion of Long-Term Debt         -          8,540                -                 -
 Accounts Payable                          -          9,649              139                53
 Accounts Payable - Intercompany       2,505              -              203                 -
 Other Accruals and Current
  Liabilities                              -           (905)               -                19
                                    --------       --------           ------            ------
                                       2,505         35,586              484                72
                                    --------       --------           ------            ------
DEFERRED CREDITS:
- ----------------
 Accumulated Deferred Income Tax           -         10,026                -                 -
 Other Deferred Credits                    -              -                -                 -
                                    --------       --------           ------            ------
                                           -         10,026                -                 -
                                    --------       --------           ------            ------

TOTAL CAPITALIZATION & LIABILITIES  $104,259       $198,787           $1,724            $2,036
                                    ========       ========           ======            ======


See Notes to Consolidated  Financial  Statements  included in Item 8 of National
Fuel Gas  Company's  Form 10-K for the fiscal  year ended  September  30,  2000,
incorporated herein by reference.












                                     Consolidated
     Total Before                    Horizon B.V.
     Eliminations   Eliminations   and Subsidiaries
     ------------   ------------   ----------------



      $249,074       $       -        $249,074
        76,472               -          76,472
      --------       ---------        --------
       172,602               -         172,602
      --------       ---------        --------

         5,542               -           5,542
          (574)              -            (574)
           142            (142)              -
           200            (200)              -
         6,455               -           6,455
         2,846               -           2,846
         4,873               -           4,873
            64               -              64
      --------       ---------        --------
        19,548            (342)         19,206
      --------       ---------        --------


       103,984        (103,984)              -
        10,672               -          10,672
      --------       ---------        --------
       114,656        (103,984)         10,672
      --------       ---------        --------
      $306,806       $(104,326)       $202,480
      ========       =========        ========




      $ 62,338       $ (62,309)       $     29
       162,004         (52,182)        109,822

        36,643         (17,136)         19,507

       (55,247)         27,643         (27,604)
      --------       ---------        --------
       205,738        (103,984)        101,754


        29,364               -          29,364
      --------       ---------        --------

       235,102        (103,984)        131,118
      --------       ---------        --------


        23,031               -          23,031
      --------       ---------        --------


        18,302               -          18,302
           142            (142)              -
         8,540               -           8,540
         9,841            (201)          9,640
         2,708               -           2,708

          (886)              1            (885)
      --------       ---------        --------
        38,647            (342)         38,305
      --------       ---------        --------

        10,026               -          10,026
             -               -               -
      --------       ---------        --------
        10,026               -          10,026
      --------       ---------        --------

      $306,806       $(104,326)       $202,480
      ========       =========        ========






                                                   HORIZON ENERGY DEVELOPMENT, B.V.
                                                   CONSOLIDATING STATEMENT OF INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                        Power
                                                         UE          Development      Horizon Energy
                                      Horizon B.V.  (Consolidated)  (Consolidated)  Development, s.r.o.
                                      ------------  --------------  --------------  ------------------- 


   OPERATING REVENUE:                  $      -       $103,511          $1,230            $1,556
   -----------------                   --------       --------          ------            ------

   OPERATING EXPENSE:
   -----------------
   Fuel Used in Heat and
    Electric Generation                       -         52,135             905                 -
   Operation                                233         23,179              70               679
   Maintenance                                -              -              28                12
   Property, Franchise & Other Taxes          -          2,462              28                84
   Depreciation, Depletion and
    Amortization                              -         11,068              18                30
   Income Taxes                               -            951               -                 -
                                       --------       --------          ------            ------
                                            233         89,795           1,049               805
                                       --------       --------          ------            ------
   Operating Income (Loss)                 (233)        13,716             181               751
                                       --------       --------          ------            ------

   OTHER INCOME:
   ------------
   Unremitted Earnings of
    Subsidiaries                          8,664              -               -                 -
   Other                                     37          1,659               1                88
                                       --------       --------          ------            ------

                                          8,701          1,659               1                88
                                       --------       --------          ------            ------

   Income (Loss) Before
    Interest Charges and
    Minority Interest in
    Foreign Subsidiaries                  8,468         15,375             182               839
                                       --------       --------          ------            ------

   INTEREST CHARGES:
   ----------------
   Interest on Long-Term Debt                 -          5,198               -                 -
   Interest - Intercompany                    -          1,053               -                 -
   Other Interest                             -             76              21                 -
                                       --------       --------          ------            ------
                                              -          6,327              21                 -
                                       --------       --------          ------            ------
   Minority Interest in
    Foreign Subsidiaries                      -         (1,384)              -                 -
                                       --------       --------          ------            ------

   Net Income (Loss) Available
    for Common Stock                   $  8,468       $  7,664          $  161            $  839
                                       ========       ========          ======            ======


   See Notes to Consolidated Financial Statements included in Item 8 of National
   Fuel Gas  Company's  Form 10-K for the fiscal year ended  September 30, 2000,
   incorporated herein by reference.











                                     Consolidated
     Total Before   Eliminations     Horizon B.V.
     Eliminations      (Dr) Cr     and Subsidiaries
     ------------      -------     ----------------


      $106,297       $ (1,513)        $104,784
      --------       --------         --------



        53,040              -           53,040
        24,161          1,513           22,648
            40              -               40
         2,574              -            2,574

        11,116              -           11,116
           951              -              951
      --------       --------         --------
        91,882          1,513           90,369
      --------       --------         --------
        14,415              -           14,415
      --------       --------         --------



         8,664         (8,664)               -
         1,785              -            1,785
      --------       --------         --------

        10,449         (8,664)           1,785
      --------       --------         --------




        24,864         (8,664)          16,200
      --------       --------         --------


         5,198              -            5,198
         1,053              -            1,053
            97              -               97
      --------       --------         --------
         6,348              -            6,348
      --------       --------         --------

        (1,384)             -           (1,384)
      --------       --------         --------


      $ 17,132       $ (8,664)        $  8,468
      ========       ========         ========






                                                  HORIZON ENERGY DEVELOPMENT, B.V.
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                       Power
                                                          UE         Development      Horizon Energy
                                      Horizon B.V.  (Consolidated)  (Consolidated)  Development, s.r.o.
                                      ------------  --------------  --------------  -------------------

   EARNINGS REINVESTED
   IN THE BUSINESS:
   ---------------

   Balance at Beginning of Year        $ 11,039       $ 10,196           $ (587)           $ (294)

   Net Income (Loss) Available
    For Common Stock                      8,468          7,664              161               839

   Dividends on Common Stock                  -           (843)               -                 -
                                       --------       --------           ------            ------

   Balance at End of Year              $ 19,507       $ 17,017           $ (426)           $  545
                                       ========       ========           ======            ======



   See Notes to Consolidated Financial Statements included in Item 8 of National
   Fuel Gas  Company's  Form 10-K for the fiscal year ended  September 30, 2000,
   incorporated herein by reference.











                                     Consolidated
     Total Before   Eliminations     Horizon B.V.
     Eliminations      (Dr) Cr     and Subsidiaries
     ------------      -------     ----------------




      $ 20,354       $ (9,315)        $ 11,039


        17,132         (8,664)           8,468

          (843)           843                -
      --------       --------         --------

      $ 36,643       $(17,136)        $ 19,507
      ========       ========         ========








                                                   HORIZON ENERGY DEVELOPMENT, B.V.
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                       Power
                                                          UE         Development      Horizon Energy
                                      Horizon B.V.  (Consolidated)  (Consolidated)  Development, s.r.o.
                                      ------------  --------------  --------------  -------------------

   CASH FLOWS FROM
   OPERATING ACTIVITIES:
   --------------------
   Net Income (Loss)                   $  8,468       $  7,664          $  161            $  839
   Adjustments to Reconcile Net
    Income to Net Cash Provided
    by Operating Activities:
    Unremitted Earnings of Subsidiaries  (8,664)             -               -                 -
    Depreciation, Depletion &
     Amortization                             -         11,068              18                30
    Deferred Income Taxes                     -          5,443               -                 -
    Minority Interest in Foreign
     Subsidiaries                             -          1,384               -                 -
    Other                                     -            481            (132)              192

   Change in:
    Accounts Receivable - Intercompany        -              -               -               177
    Receivables and Unbilled Utility
     Revenue                                  -           (574)           (122)              (26)
    Materials and Supplies                    -          1,165               -                 -
    Prepayments                               -             21              (1)                3
    Accounts Payable                          -            767             (89)               98
    Accounts Payable - Intercompany      (1,705)             -               -                 -
    Other Accruals and Current
     Liabilities                              -         (4,545)             18               (33)
    Other Assets                            (18)        (1,406)              -                 -
    Other Liabilities                         -            (24)              -                 -
                                       --------       --------          ------            ------

   Net Cash Provided by (Used in)
    Operating Activities                 (1,919)        21,444            (147)            1,280
                                       --------       --------          ------            ------

   CASH FLOWS FROM INVESTING ACTIVITIES:
   ------------------------------------
   Capital Expenditures                       -         (9,718)            (20)              (29)
   Change in Notes
    Receivable-Intercompany                   -              -               -              (142)
   Dividends Received from Associated
    Company                                 843              -               -                 -
   Other                                      -          3,361               -                 -
                                       --------       --------          ------            ------
   Net Cash Used in Investing
    Activities                              843         (6,357)            (20)             (171)
                                       --------       --------          ------            ------

   CASH FLOWS FROM FINANCING ACTIVITIES:
   ------------------------------------
   Change in Notes Payable to Banks           -         17,577               -                 -
   Change in Notes Payable - Intercompany     -        (22,100)            142                 -
   Reduction of Long-Term Debt                -        (15,416)              -                 -
   Dividends Paid on Common Stock             -           (995)              -                 -
                                       --------       --------          ------            ------
   Net Cash Provided by (Used in)
    Financing Activities                      -        (20,934)            142                 -
                                       --------       --------          ------            ------

   Effect of Exchange Rates on Cash           -         (3,432)             10              (353)
                                       --------       --------          ------            ------

   Net Increase (Decrease) in Cash
    and Temporary Cash Investments       (1,076)        (9,279)            (15)              756

   Cash and Temporary Cash
    Investments at Beginning of Period    1,188         13,432              43               493
                                       --------       --------          ------            ------

   Cash and Temporary Cash
    Investments at End of Period       $    112       $  4,153          $   28            $1,249
                                       ========       ========          ======            ======


   See Notes to Consolidated Financial Statements included in Item 8 of National
   Fuel Gas  Company's  Form 10-K for the fiscal year ended  September 30, 2000,
   incorporated herein by reference.











                                     Consolidated
     Total Before                    Horizon B.V.
     Eliminations   Eliminations   and Subsidiaries
     ------------   ------------   ----------------



      $ 17,132       $ (8,664)        $  8,468



        (8,664)         8,664                -

        11,116              -           11,116
         5,443              -            5,443

         1,384              -            1,384
           541              -              541


           177           (177)               -

          (722)             -             (722)
         1,165              -            1,165
            23              -               23
           776            177              953
        (1,705)             -           (1,705)

        (4,560)             -           (4,560)
        (1,424)             -           (1,424)
           (24)             -              (24)
      --------       --------        ---------


        20,658              -           20,658
      --------       --------        ---------


        (9,767)             -           (9,767)

          (142)           142                -

           843           (843)               -
         3,361              -            3,361
      --------       --------        ---------

        (5,705)          (701)          (6,406)
      --------       --------        ---------


        17,577              -           17,577
       (21,958)          (142)         (22,100)
       (15,416)             -          (15,416)
          (995)           843             (152)
      --------       --------        ---------

       (20,792)           701          (20,091)
      --------       --------        ---------

        (3,775)             -           (3,775)
      --------       --------        ---------


        (9,614)             -           (9,614)


        15,156              -           15,156
      --------       --------        ---------


      $  5,542       $      -        $   5,542
      ========       ========        =========





                                                   HORIZON ENERGY DEVELOPMENT, B.V.
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                       Power
                                                          UE         Development      Horizon Energy
                                      Horizon B.V.  (Consolidated)  (Consolidated)  Development, s.r.o.
                                      ------------  --------------  --------------  -------------------

   Net Income (Loss) Available for
     Common Stock                      $  8,468       $  7,664          $ 161               $839
                                       --------       --------          -----               ----

   Other Comprehensive Income (Loss):
     Foreign Currency Translation
       Adjustment                       (23,132)       (22,367)          (391)              (374)
                                       --------       --------          -----               ----
   Other Comprehensive Income (Loss)    (23,132)       (22,367)          (391)              (374)
                                       --------       --------          -----               ----

   Comprehensive Income (Loss)         $(14,664)      $(14,703)         $(230)              $465
                                       ========       ========          =====               ====


   See Notes to Consolidated Financial Statements included in Item 8 of National
   Fuel Gas  Company's  Form 10-K for the fiscal year ended  September 30, 2000,
   incorporated herein by reference.












                                     Consolidated
     Total Before   Eliminations     Horizon B.V.
     Eliminations      (Dr) Cr     and Subsidiaries
     ------------      -------     ----------------


      $ 17,132        $(8,664)         $  8,468
      --------        -------          --------



       (46,264)        23,132           (23,132)
      --------        -------          --------
       (46,264)        23,132           (23,132)
      --------        -------          --------

      $(29,132)       $14,468          $(14,664)
      ========        =======          ========





                                                          UNITED ENERGY, a.s.
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                      Jablonecka
                                                                     Teplarenska a
                                                         Teplarna    Realitni, as
                                              UE         Liberec        (JTR)           ENOP
                                              --         -------        -----           ----

     ASSETS
     ------

     PROPERTY, PLANT & EQUIPMENT           $223,408     $ 13,189      $ 11,276          $ 65
     ---------------------------
      Less: Accumulated  DD&A                71,809        3,488           798            28
                                           --------     --------      --------          ----
                                            151,599        9,701        10,478          $ 37
                                           --------     --------      --------          ----
     CURRENT ASSETS:
     --------------
      Cash and Temporary Cash Investments     2,060        1,573           502            18
      Allowance for Uncollectible Accounts     (178)        (385)          (11)            -
      Notes Receivable - Intercompany           546            -             -             -
      Accounts Receivable - Intercompany         14            -             -             -
      Accounts Receivable                     3,681        1,584           490           389
      Unbilled Utility Revenue                2,148           61           637             -
      Materials and Supplies                  2,632          694         1,547             -
      Prepayments                                23            8             6             -
                                           --------     --------      --------          ----
                                             10,926        3,535         3,171           407
                                           --------     --------      --------          ----
     OTHER ASSETS:
     ------------
      Notes Receivable - Intercompany             -            -             -             -
      Investment in Associated Companies     13,725            -             -             -
      Other Assets                           10,607       (1,036)         (184)          106
                                           --------     --------      --------          ----
                                             24,332       (1,036)         (184)          106
                                           --------     --------      --------          ----
     TOTAL ASSETS                          $186,857     $ 12,200      $ 13,465          $550
                                           ========     ========      ========          ====

     CAPITALIZATION & LIABILITIES
     ----------------------------

     CAPITALIZATION:
     --------------
      Common Stock                         $ 59,770     $ 17,004      $  5,407          $  3
      Paid - in - Capital                    50,620       (5,723)          854           883
      Earnings Reinvested in the Business    17,017          207           271           (76)
      Accumulated Other Comprehensive
       Income                               (26,627)      (3,923)       (1,035)         (147)
                                           --------     --------      --------         -----
      Total Common Stock Equity             100,780        7,565         5,497           663

      Long-Term Debt, Net of Current
       Portion                               27,883            -         1,481             -
                                           --------     --------      --------          ----

      Total Capitalization                  128,663        7,565         6,978           663
                                           --------     --------      --------          ----
     Minority Interest in Foreign
       Subsidiaries                          16,338        3,705         2,988             -
                                           --------     --------      --------          ----

     CURRENT AND ACCRUED LIABILITIES:
     -------------------------------
      Notes Payable to Banks                 17,099            -         1,203             -
      Notes Payable - Intercompany                -            -           546             -
      Current Portion of Long-Term Debt       8,327            -           213             -
      Accounts Payable                        8,076          314         1,255           (17)
      Accounts Payable - Intercompany            35            -             -             -
      Other Accruals and Current
        Liabilities                            (567)          49          (290)          (97)
                                           --------     --------      --------          ----
                                             32,970          363         2,927          (114)
                                           --------     --------      --------          ----
     DEFERRED CREDITS:
     ----------------
      Accumulated Deferred Income Taxes       8,886          567           572             1
      Other Deferred Credits                      -            -             -             -
                                           --------     --------      --------          ----
                                              8,886          567           572             1
                                           --------     --------      --------          ----

     TOTAL CAPITALIZATION & LIABILITIES    $186,857     $ 12,200      $ 13,465          $550
                                           ========     ========      ========          ====


     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.











                                    Consolidated
       Total Before                    UE and
      Eliminations  Eliminations   Subsidiaries
      ------------  ------------   ------------



        $247,938     $       -       $247,938
          76,123             -         76,123
        --------     ---------       --------
         171,815             -        171,815
        --------     ---------       --------

           4,153             -          4,153
            (574)            -           (574)
             546          (546)             -

              14           (14)             -
           6,144             -          6,144
           2,846             -          2,846
           4,873             -          4,873
              37             -             37
        --------     ---------       --------
          18,039          (560)        17,479
        --------     ---------       --------

               -             -              -
          13,725       (13,725)             -
           9,493             -          9,493
        --------     ---------       --------
          23,218       (13,725)         9,493
        --------     ---------       --------
        $213,072     $ (14,285)      $198,787
        ========     =========       ========




        $ 82,184     $ (22,414)      $ 59,770
          46,634         3,986         50,620
          17,419          (402)        17,017

         (31,732)        5,105        (26,627)
        --------     ---------       --------
         114,505       (13,725)       100,780


          29,364             -         29,364
        --------     ---------       --------

         143,869       (13,725)       130,144
        --------     ---------       --------

          23,031             -         23,031
        --------     ---------       --------


          18,302             -         18,302
             546          (546)             -
           8,540             -          8,540
           9,628            21          9,649
              35           (35)             -

            (905)            -           (905)
        --------     ---------       --------
          36,146          (560)        35,586
        --------     ---------       --------

          10,026             -         10,026
               -             -              -
        --------     ---------       --------
          10,026             -         10,026
        --------     ---------       --------

        $213,072     $ (14,285)      $198,787
        ========     =========       ========








                                                             UNITED ENERGY, a.s.
                                                      CONSOLIDATING STATEMENT OF INCOME
                                                 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                              (THOUSANDS OF DOLLARS)




                                                     Teplarna
                                            UE       Liberec        JTR          ENOP
                                         -------     -------      -------       -----

       OPERATING REVENUE:                $82,706     $15,986      $ 7,941       $3,115
       -----------------                 -------     -------      -------       ------

       OPERATING EXPENSE:
       -----------------
       Fuel Used in Heat and
         Electric Generation              38,830       8,849        4,456            -
       Operation                          17,836       6,583        1,732        3,265
       Property, Franchise & Other Taxes   1,720         323          175          244
       Depreciation, Depletion and
         Amortization                      9,257         909          895            7
       Income Taxes                          618         302          215         (184)
                                         -------     -------      -------      -------
                                          68,261      16,966        7,473        3,332
                                         -------     -------      -------      -------
       Operating Income (Loss)            14,445        (980)         468         (217)
                                         -------     -------      -------      -------

       OTHER INCOME:
       ------------
       Unremitted Earnings of
         Subsidiary                         (506)          -            -            -
       Other                               1,406         222           30            1
                                         -------     -------      -------      -------

                                             900         222           30            1
                                         -------     -------      -------      -------

       Income (Loss) Before
         Interest Charges and
         Minority Interest in
         Foreign Subsidiaries             15,345        (758)         498         (216)
                                         -------     -------      -------      -------

       INTEREST CHARGES:
       ----------------
       Interest on Long-Term Debt          5,042           -          156            -
       Interest - Intercompany             1,053           -            -            -
       Other Interest                         76           -            -            -
                                         -------     -------      -------      -------
                                           6,171           -          156            -
                                         -------     -------      -------      -------
       Minority Interest in
         Foreign Subsidiaries             (1,510)        245         (119)           -
                                         -------     -------      -------      -------

       Net Income (Loss) Available
         for Common Stock                $ 7,664     $  (513)     $   223      $  (216)
                                         =======     =======      =======      =======


       See Notes to  Consolidated  Financial  Statements  included  in Item 8 of
       National Fuel Gas Company's Form 10-K for the fiscal year ended September
       30, 2000, incorporated herein by reference.













                                          Consolidated
            Total Before   Eliminations      UE and
            Eliminations      (Dr) Cr     Subsidiaries
            ------------      -------     ------------

              $109,748      $(6,237)       $103,511
              --------      -------        --------



                52,135            -          52,135
                29,416        6,237          23,179
                 2,462            -           2,462

                11,068            -          11,068
                   951            -             951
              --------      -------        --------
                96,032        6,237          89,795
              --------      -------        --------
                13,716            -          13,716
              --------      -------        --------



                  (506)         506               -
                 1,659            -           1,659
              --------      -------        --------

                 1,153          506           1,659
              --------      -------        --------




                14,869          506          15,375
              --------      -------        --------


                 5,198            -           5,198
                 1,053            -           1,053
                    76            -              76
              --------      -------        --------
                 6,327            -           6,327
              --------      -------        --------

                (1,384)           -          (1,384)
              --------      -------        --------


              $  7,158      $   506        $  7,664
              ========      =======        ========







                                                             UNITED ENERGY, a.s.
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)



       EARNINGS REINVESTED                             Teplarna
       IN THE BUSINESS                       UE        Liberec       JTR         ENOP
       -------------------                --------     --------     -----        ----

       Balance at Beginning of Year       $ 10,196     $   720      $  48        $ 140


       Net Income (Loss) Available
         for Common Stock                    7,664        (513)       223         (216)

       Dividends on Common Stock              (843)          -          -            -
                                          --------     -------      -----        -----


       Balance at End of Year             $ 17,017     $   207      $ 271        $ (76)
                                          ========     =======      =====        =====


       See Notes to  Consolidated  Financial  Statements  included  in Item 8 of
       National Fuel Gas Company's Form 10-K for the fiscal year ended September
       30, 2000, incorporated herein by reference.











                                      Consolidated
        Total Before   Eliminations      UE and
        Eliminations      (Dr) Cr     Subsidiaries
        ------------      -------     ------------

        $ 11,104         $ (908)        $ 10,196



           7,158            506            7,664

            (843)             -             (843)
        --------         ------         --------

        $ 17,419         $ (402)        $ 17,017
        ========         ======         ========








                                                          UNITED ENERGY, a.s.
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)


                                                         Teplarna
                                                UE       Liberec       JTR         ENOP
                                             --------    -------     -------     --------
     CASH FLOWS FROM OPERATING ACTIVITIES:
     ------------------------------------
     Net Income (Loss)                       $  7,664    $   (513)   $   223       $ (216)
     Adjustments to Reconcile Net Income
       to Net Cash Provided by Operating
       Activities:
      Unremitted Earnings of Subsidiaries         506           -          -            -
      Depreciation, Depletion &
       Amortization                             9,257         909        895            7
      Deferred Income Taxes                     4,382         503        556            2
      Minority Interest in Foreign
       Subsidiaries                             1,510        (245)       119            -
      Other                                       547         (59)       (13)           6

     Change in:
      Receivables and Unbilled Utility
       Revenue                                   (998)       (346)       166          604
      Accounts Receivable - Intercompany           40           -          -            -
      Materials and Supplies                      715       1,131       (681)           -
      Prepayments                                  28          (7)         -            -
      Accounts Payable                            335          97        324         (129)
      Accounts Payable - Intercompany             (62)          -          -            -
      Other Accruals and Current
       Liabilities                             (2,902)       (554)      (830)        (259)
      Other Assets                             (1,132)        (39)      (235)           -
      Other Liabilities                           (24)          -          -            -
                                             --------     -------    -------     --------

     Net Cash Provided by (Used in)
       Operating Activities                    19,866         877        524           15
                                             --------    --------    -------     --------

     CASH FLOWS FROM INVESTING ACTIVITIES:
     ------------------------------------
     Capital Expenditures                      (6,893)     (1,120)    (1,703)          (2)
     Change in Notes
       Receivable - Intercompany                 (384)          -          -            -
     Other                                      3,255          37         68            1
                                             --------    --------    -------     --------
     Net Cash Used in Investing
       Activities                              (4,022)     (1,083)    (1,635)          (1)
                                             --------    --------    -------     --------

     CASH FLOWS FROM FINANCING ACTIVITIES:
     ------------------------------------
     Change in Notes Payable to Banks          16,321           -      1,256            -
     Change in Notes Payable - Intercompany   (22,100)          -        546            -
     Reduction of Long-Term Debt              (15,143)          -       (273)           -
     Dividends Paid on Common Stock              (995)          -          -            -
                                             --------    --------    -------     --------

     Net Cash Provided by (Used in)
       Financing Activities                   (21,917)          -      1,529            -
                                             --------    --------    -------     --------

     Effect of Exchange Rates on Cash          (2,780)       (461)      (175)         (16)
                                             --------    --------    -------     --------
     Net Increase (Decrease) in Cash
       and Temporary Cash Investments          (8,853)       (667)       243           (2)

     Cash and Temporary Cash Investments
       at Beginning of Period
       (at Acquisition for JTR)                10,913       2,240        259           20
                                             --------    --------    -------     --------

     Cash and Temporary Cash Investments
       at End of Period                      $  2,060    $  1,573    $   502     $     18
                                             ========    ========    =======     ========


     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.










        Total Before                 Consolidated
        Eliminations                    UE and
        & Adjustments  Eliminations  Subsidiaries
        -------------  ------------  ------------

          $  7,158      $    506       $  7,664



               506          (506)             -

            11,068             -         11,068
             5,443             -          5,443

             1,384             -          1,384
               481             -            481



              (574)            -           (574)
                40           (40)             -
             1,165             -          1,165
                21             -             21
               627           140            767
               (62)           62              -

            (4,545)            -         (4,545)
            (1,406)            -         (1,406)
               (24)            -            (24)
          --------      --------       --------


            21,282           162         21,444
          --------      --------       --------


            (9,718)            -         (9,718)

              (384)          384              -
             3,361             -          3,361
          --------      --------       --------

            (6,741)          384         (6,357)
          --------      --------       --------


            17,577             -         17,577
           (21,554)         (546)       (22,100)
           (15,416)            -        (15,416)
              (995)            -           (995)
          --------      --------      ---------


           (20,388)         (546)       (20,934)
          --------      --------       --------

            (3,432)            -         (3,432)
          --------      --------       --------


            (9,279)            -         (9,279)



            13,432             -         13,432
          --------      --------       --------


          $  4,153      $      -       $  4,153
          ========      ========       ========








                                                          UNITED ENERGY, a.s.
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)



       EARNINGS REINVESTED                              Teplarna
       IN THE BUSINESS                         UE       Liberec      JTR       ENOP
       -------------------                  --------    --------    -----      ----  

       Net Income Available for
         Common Stock                       $  7,664    $  (513)   $    223    $(216)


       Other Comprehensive Income (Loss):
         Foreign Currency Translation
           Adjustment                        (22,367)    (1,920)     (1,183)    (157)
                                            --------    -------    --------    -----

       Other Comprehensive Income (Loss)     (22,367)    (1,920)     (1,183)    (157)
                                            --------    -------    --------    -----


       Comprehensive Income (Loss)          $(14,703)   $(2,433)   $   (960)   $(373)
                                            ========    =======    ========    =====


       See Notes to  Consolidated  Financial  Statements  included  in Item 8 of
       National Fuel Gas Company's Form 10-K for the fiscal year ended September
       30, 2000, incorporated herein by reference.











                                      Consolidated
        Total Before   Eliminations      UE and
        Eliminations      (Dr) Cr     Subsidiaries
        ------------      -------     ------------


          $  7,158       $   506        $  7,664




           (25,627)        3,260         (22,367)
          --------       -------        --------

           (25,627)        3,260         (22,367)
          --------       -------        --------


          $(18,469)      $ 3,766        $(14,703)
          ========       =======        ========








                                                       POWER DEVELOPMENT, S.R.O.
                                                      CONSOLIDATING BALANCE SHEET
                                                         AT SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                               Consolidated
                                                                                                  Power
                                               Power               Total Before                Development
                                            Development  Kromeriz  Eliminations  Eliminations  and Subsidiary
                                            -----------  --------  ------------  ------------  --------------

     ASSETS
     ------

     PROPERTY, PLANT & EQUIPMENT              $    -      $  917      $  917       $     -         $  917
     ---------------------------
      Less: Accumulated  DD&A                      -         194         194             -            194
                                              ------      ------      ------       -------         ------
                                                   -         723         723             -            723
                                              ------      ------      ------       -------         ------
     CURRENT ASSETS:
     --------------
      Cash and Temporary Cash Investments          2          26          28             -             28
      Accounts Receivable - Intercompany         610           -         610          (610)             -
      Accounts Receivable                          -         269         269             -            269
      Prepayments                                  -           2           2             -              2
                                              ------      ------      ------       -------         ------
                                                 612         297         909          (610)           299
                                              ------      ------      ------       -------         ------
     OTHER ASSETS:
     ------------
     Investment in Associated Company            586           -         586          (586)             -
      Other Assets                               115         587         702             -            702
                                              ------      ------      ------       -------         ------
                                                 701         587       1,288          (586)           702
                                              ------      ------      ------       -------         ------

     TOTAL ASSETS                             $1,313      $1,607      $2,920       $(1,196)        $1,724
                                              ======      ======      ======       =======         ======

     CAPITALIZATION & LIABILITIES
     ----------------------------

     CAPITALIZATION:
     --------------
      Common Stock                            $  760      $  634      $1,394       $  (634)        $  760
      Paid - in - Capital                      1,562         354       1,916          (354)         1,562
      Earnings Reinvested in the Business       (426)       (326)       (752)          326           (426)
      Accumulated Other Comprehensive Income    (656)        (76)       (732)           76            (656)
                                              ------      ------      ------       -------          ------
      Total Capitalization                     1,240         586       1,826          (586)         1,240
                                              ------      ------      ------       -------         ------

     CURRENT AND ACCRUED LIABILITIES:
     -------------------------------
      Notes Payable - Intercompany                 -         142         142             -            142
      Accounts Payable                             1          77          78            61            139
      Accounts Payable - Intercompany             72         802         874          (671)           203
                                              ------      ------      ------       -------         ------
                                                  73       1,021       1,094          (610)           484
                                              ------      ------      ------       -------         ------

     TOTAL CAPITALIZATION & LIABILITIES       $1,313      $1,607      $2,920       $(1,196)        $1,724
                                              ======      ======      ======       =======         ======


     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.





                                                       POWER DEVELOPMENT, S.R.O.
                                                   CONSOLIDATING STATEMENT OF INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                           (THOUSANDS OF DOLLARS)

                                                                                            Consolidated
                                                                                               Power
                                        Power                 Total Before   Eliminations   Development
                                     Development   Kromeriz   Eliminations      (Dr) Cr     and Subsidiary
                                     -----------   --------   ------------      -------     --------------

     OPERATING REVENUE:                 $   -       $1,230       $1,230         $   -          $1,230
     -----------------                  -----       ------       ------         -----          ------

     OPERATING EXPENSE:
     -----------------
     Fuel Used in Heat and
       Electric Generation                  -          905          905             -             905
     Operation                           (167)         237           70             -              70
     Maintenance                            -           28           28             -              28
     Property, Franchise & Other Taxes      -           28           28             -              28
     Depreciation, Depletion and
       Amortization                         -           18           18             -              18
                                        -----       ------       ------         -----          ------
                                         (167)       1,216        1,049             -           1,049
                                        -----       ------       ------         -----          ------
     Operating Income (Loss)              167           14          181             -             181
                                        -----       ------       ------         -----          ------

     OTHER INCOME:
     ------------
     Unremitted Earnings of
       Subsidiary                          11            -           11           (11)              -
     Other                                  -            1            1             -               1
                                        -----       ------       ------         -----          ------

                                           11            1           12           (11)              1
                                        -----       ------       ------         -----          ------

     Income (Loss) Before
       Interest Charges                   178           15          193           (11)            182
                                        -----       ------       ------         -----          ------

     INTEREST CHARGES:
     ----------------
     Other Interest                        17            4           21             -              21
                                        -----       ------       ------         -----          ------
                                           17            4           21             -              21
                                        -----       ------       ------         -----          ------
     Net Income (Loss) Available
      for Common Stock                  $ 161       $   11       $  172         $ (11)         $  161
                                        =====       ======       ======         =====          ======



     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.






                                                       POWER DEVELOPMENT, S.R.O.
                                    CONSOLIDATING STATEMENT OF EARNINGS REINVESTED IN THE BUSINESS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                    Consolidated
                                                                                                       Power
     EARNINGS REINVESTED                  Power                       Total Before   Eliminations   Development
     IN THE BUSINESS                   Development     Kromeriz       Eliminations      (Dr) Cr     and Subsidiary
     -------------------               -----------     --------       ------------   ------------   --------------

     Balance at Beginning of Year         $(587)        $(337)           $(924)          $337         $(587)


     Net Income (Loss) Available
       for Common Stock                     161            11              172            (11)          161
                                          -----         -----            -----           ----         -----


     Balance at End of Year               $(426)        $(326)           $(752)          $326         $(426)
                                          =====         =====            =====           ====         =====


     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.






                                                       POWER DEVELOPMENT, S.R.O.
                                                 CONSOLIDATING STATEMENT OF CASH FLOWS
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                   Consolidated
                                                                                                      Power
                                             Power                  Total Before                   Development
                                           Development   Kromeriz   Eliminations    Eliminations   and Subsidiary
                                           -----------   --------   ------------    ------------   --------------
     CASH FLOWS FROM OPERATING ACTIVITIES:
     ------------------------------------
     Net Income (Loss)                       $ 161         $  11        $ 172          $ (11)         $ 161
     Adjustments to Reconcile Net Income
       to Net Cash Provided by Operating
       Activities:
      Unremitted Earnings of Subsidiary        (11)            -          (11)            11              -
      Depreciation, Depletion &
       Amortization                              -            18           18              -             18
      Other                                   (169)           37         (132)             -           (132)

     Change in:
      Accounts Receivable                        -          (122)        (122)             -           (122)
      Prepayments                                -            (1)          (1)             -             (1)
      Accounts Payable                           -           (89)         (89)             -            (89)
      Other Accruals and Current
       Liabilities                               -            18           18              -             18
                                             -----         -----        -----          -----          -----

     Net Cash Provided by (Used in)
       Operating Activities                    (19)         (128)        (147)             -           (147)
                                             -----         -----        -----          -----          -----

     CASH FLOWS FROM INVESTING ACTIVITIES:
     ------------------------------------
     Capital Expenditures                        -           (20)         (20)             -            (20)
                                             -----         -----        -----          -----          -----

     Net Cash Used in Investing
       Activities                                -           (20)         (20)             -            (20)
                                             -----         -----        -----          -----          -----

     CASH FLOWS FROM FINANCING ACTIVITIES:
     ------------------------------------
     Change in Notes Payable - Intercompany      -           142          142              -            142
                                             -----         -----        -----          -----          -----

     Net Cash Provided by
       Financing Activities                      -           142          142              -            142
                                             -----         -----        -----          -----          -----

     Effect of Exchange Rates on Cash           17            (7)          10              -             10
                                             -----         -----        -----          -----          -----

     Net Increase (Decrease) in Cash and
       Temporary Cash Investments               (2)          (13)         (15)             -            (15)

     Cash and Temporary Cash Investments
       at Beginning of Period                    4            39           43              -             43
                                             -----         -----        -----          -----          -----

     Cash and Temporary Cash Investments
       at End of Period                      $   2         $  26        $  28          $   -          $  28
                                             =====         =====        =====          =====          =====


     See  Notes  to  Consolidated  Financial  Statements  included  in Item 8 of
     National Fuel Gas Company's  Form 10-K for the fiscal year ended  September
     30, 2000, incorporated herein by reference.





                                                       POWER DEVELOPMENT, S.R.O.
                                            CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME
                                             FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2000
                                                        (THOUSANDS OF DOLLARS)

                                                                                                   Consolidated
                                                                                                      Power
    EARNINGS REINVESTED                  Power                       Total Before   Eliminations   Development
    IN THE BUSINESS                   Development     Kromeriz       Eliminations      (Dr) Cr     and Subsidiary
    -------------------               -----------     --------       ------------   ------------   --------------

    Net Income (Loss) Available for
      Common Stock                       $ 161         $  11            $ 172           $(11)        $ 161


    Other Comprehensive Income (Loss):
      Foreign Currency Translation
        Adjustment                        (391)          (25)            (416)            25          (391)
                                         -----         -----            -----           ----         -----

    Other Comprehensive Income (Loss)     (391)          (25)            (416)            25          (391)
                                         -----         -----            -----           ----         -----


    Comprehensive Income (Loss)          $(230)        $ (14)           $(244)          $ 14         $(230)
                                         =====         =====            =====           ====         =====


    See  Notes  to  Consolidated  Financial  Statements  included  in  Item 8 of
    National  Fuel Gas Company's  Form 10-K for the fiscal year ended  September
    30, 2000, incorporated herein by reference.







EXHIBITS

   A.    *(1)  Annual Report on Form 10-K for fiscal year ended September 30, 2000
               filed December 15, 2000 (File No. 1-3880).

          (2)  National Fuel Gas Company 2000 Annual Report to Shareholders
               (paper copy submitted under cover of Form SE).

         *(3)  National Fuel Gas Company Proxy Statement, dated and filed
               January 29, 2001 (File No. 1-03880).

   B.    Articles of Incorporation, By-Laws and Partnership Agreements.

         (1)      National Fuel Gas Company

                    *i    Restated Certificate of Incorporation of National Fuel
                          Gas Company,  dated  September  21, 1998 (Exhibit 3.1,
                          Form 10-K for fiscal year ended  September 30, 1998 in
                          File No. 1-3880).

                    ii    National  Fuel Gas Company  By-Laws as amended on June
                          15,  2000.  Designated  as Exhibit  EX-99-1  for EDGAR
                          purposes.

         (2)      National Fuel Gas Distribution Corporation

                    *i    By-Laws,  as amended  March 11, 1998.  (Exhibit  (2)i,
                          designated as Exhibit EX-99-1 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1999.)

                   *ii    Restated Certificate of Incorporation of National Fuel
                          Gas  Distribution  Corporation,   dated  May  9,  1988
                          (Exhibit B-1 in File No. 70-7478).

         (3)      National Fuel Gas Supply Corporation

                    *i    By-Laws, as amended (Exhibit (3)i, Form U5S for fiscal
                          year ended September 30, 1989).

                   *ii    Articles  of   Incorporation  of  United  Natural  Gas
                          Company,  dated February 1, 1886 (Exhibit (3)ii,  Form
                          U5S for fiscal year ended September 30, 1984).

                  *iii    Certificate of Merger and Consolidation  dated January
                          2, 1951  (Exhibit  (3)iii,  Form U5S for  fiscal  year
                          ended September 30, 1984).

                   *iv    Joint  Agreement  and Plan of  Merger,  dated June 18,
                          1974  (Exhibit  (3)iv,  Form U5S for fiscal year ended
                          September 30, 1987).

                    *v    Certificate  of Merger and Plan of Merger of Penn-York
                          Energy   Corporation  and  National  Fuel  Gas  Supply
                          Corporation   dated  April  1,  1994  (Exhibit   (3)v,
                          designated as Exhibit EX-99-3 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1994).



* Incorporated herein by reference as indicated.



EXHIBITS (Continued)

         (4)      Leidy Hub, Inc. (Formerly Enerop Corporation)

                    *i    By-Laws (Exhibit A-15, File No. 70-7478).

                   *ii    Restated   Certificate  of   Incorporation  of  Enerop
                          Corporation  dated October 15, 1993.  (Exhibit  (4)ii,
                          designated as Exhibit Ex-99-2 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1999).

                  *iii    Action  by Board of  Directors  to amend  the  By-Laws
                          dated October 10, 1993 (Exhibit (4)iii,  designated as
                          Exhibit EX-3 for EDGAR  purposes,  Form U5S for fiscal
                          year ended September 30, 1993).

         (5)      Seneca Resources Corporation

                    *i    By-Laws, as amended (Exhibit (5)i, Form U5S for fiscal
                          year ended September 30, 1989).

                   *ii    Articles of  Incorporation of Mars Natural Gas Company
                          dated  March 29,  1913  (Exhibit  (5)ii,  Form U5S for
                          fiscal year ended September 30, 1984).

                  *iii    Secretary's Certificate dated January 4, 1918 (Exhibit
                          (5)iii,  Form U5S for fiscal year ended  September 30,
                          1984).

                   *iv    Articles of  Amendment,  dated March 30, 1955 (Exhibit
                          (5)iv,  Form U5S for fiscal year ended  September  30,
                          1984).

                    *v    Certificate  of  Amendment  changing  name of the Mars
                          Company to Seneca Resources  Corporation,  January 29,
                          1976  (Exhibit  (5)v,  Form U5S for fiscal  year ended
                          September 30, 1984).

                   *vi    Certificate  of  Merger  and Plan of  Merger of Seneca
                          Resources  Corporation  and Empire  Exploration,  Inc.
                          dated April 29, 1994  (Exhibit  (5)vi,  designated  as
                          Exhibit  EX-99-2  for  EDGAR  purposes,  Form  U5S for
                          fiscal year ended September 30, 1994).

                  *vii    Articles  of  Merger  and  Plan of  Merger  of  HarCor
                          Energy,   Inc.   with   and  into   Seneca   Resources
                          Corporation,  filed August 31, 1999.  (Exhibit (5)vii,
                          designated as Exhibit EX-99-3 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1999.)

                 *viii    Certificate  of Ownership  and Merger  merging  HarCor
                          Energy,  Inc. into Seneca Resources  Corporation filed
                          August  31,  1999.  (Exhibit  (5)viii,  designated  as
                          Exhibit  EX-99-4  for  EDGAR  purposes,  Form  U5S for
                          fiscal year ended September 30, 1999.)



* Incorporated herein by reference as indicated.





EXHIBITS (Continued)


         *(6)     Limited Partnership Agreement dated November 28, 1983, between
                  Empire Exploration, Inc. (now Seneca Resources Corporation) as
                  general  partner  and  Herman  P.  Loonsk as  limited  partner
                  (Exhibit  (8),  Form U5S for fiscal year ended  September  30,
                  1984).

         *(7)     Empire 1983 Drilling Program,  Limited Partnership  Agreement,
                  dated  November 28, 1983,  between Empire  Exploration,  Inc.,
                  (now  Seneca  Resources  Corporation)  as general  partner and
                  those parties  collectively  called limited partners  (Exhibit
                  (9), Form U5S for fiscal year ended September 30, 1984).

         *(8)     Empire 1983 Joint  Venture  Agreement  dated  December 6, 1983
                  between  Empire   Exploration,   Inc.  (now  Seneca  Resources
                  Corporation)  and Empire 1983 Drilling  Program (Exhibit (10),
                  Form U5S for fiscal year ended September 30, 1984).

          (9)     Highland Forest Resources, Inc. (formerly known as Highland
                  Land & Minerals, Inc.)

                    *i    Certificate  of  Incorporation,  dated August 19, 1982
                          (Exhibit  (11)i,   Form  U5S  for  fiscal  year  ended
                          September 30, 1985).

                   *ii    By-Laws  (Exhibit  (11) ii,  Form U5S for fiscal  year
                          ended September 30, 1987).

                  *iii    Articles  of  Merger  and Plan of  Merger  of  Utility
                          Constructors, Inc. into Highland Land & Minerals, Inc.
                          filed October 1, 1999. (Exhibit (9)iii,  designated as
                          Exhibit  EX-99-5  for  EDGAR  purposes,  Form  U5S for
                          fiscal year ended September 30, 1999.)

                    iv    Articles  of   Amendment   of  the   Articles  of  the
                          Corporation, dated June 8, 2000. Designated as Exhibit
                          EX-99-2 for EDGAR purposes.

         (10)     Data-Track Account Services, Inc.

                    *i    Restated  Articles  of  Incorporation,  dated March 2,
                          1984 (Exhibit A-1, File No. 70-7512).

                   *ii    By-Laws (Exhibit A-2, File No. 70-7512).

      (11)        National Fuel Resources, Inc.

                    *i    Articles  of  Incorporation,  dated  January  9,  1991
                          (Exhibit  (14)i,  designated  as Exhibit  EX-3(a)  for
                          EDGAR  purposes,   Form  U5S  for  fiscal  year  ended
                          September 30, 1992).

                   *ii    By-Laws (Exhibit (14)ii, designated as Exhibit EX-3(b)
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1992).

* Incorporated herein by reference as indicated.





EXHIBITS (Continued)


      (12)        NFR Power, Inc.

              *i          Certificate of Incorporation, dated December 13, 1995.
                          (Exhibit (13)i, designated as Exhibit EX-3-1 for EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1999.)

             *ii          By-Laws. (Exhibit (13)ii, designated as Exhibit EX-3-2
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1999.)

        (13)      Horizon Energy Development, Inc.

                    *i    Certificate   of    Incorporation    (Exhibit   (13)i,
                          designated as Exhibit EX-3(a) for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1995).

                   *ii    By-Laws (Exhibit (13)ii, designated as Exhibit EX-3(b)
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1995).

        (14)      Horizon Energy Holdings, Inc.

                    *i    Certificate  of  Incorporation  dated  April 1,  1998.
                          (Exhibit (14)i  designated as Exhibit EX99-1 for EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1998).

                   *ii    By-Laws. (Exhibit (14)ii, designated as Exhibit EX99-2
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1998).

         (15)     Horizon Energy Development B.V. (formerly Beheeren-
                  Beleggingmaatschappij Bruwabel B.V.

                    *i    Articles of Incorporation (Exhibit (14), designated as
                          exhibit  EX-99-2  for  EDGAR  purposes,  Form  U5S for
                          fiscal year ended September 30, 1996).

         (16)     Horizon Energy Development, s.r.o. (formerly Power
                  International, s.r.o.)

                    *i    Founding  Notarial  Deed,  dated May 8, 1991  (Exhibit
                          (15)i,   designated  as  Exhibit   EX-99-9  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1996).

                   *ii    Notarial Deed, dated December 2, 1993 (Exhibit (15)ii,
                          designated  as Exhibit  EX-99-10  for EDGAR  purposes,
                          Form U5S/A for fiscal year ended September 30, 1996).

                  *iii    Notarial Deed,  dated June 28, 1996 (Exhibit  (15)iii,
                          designated  as Exhibit  EX-99-11  for EDGAR  purposes,
                          Form U5S/A for fiscal year ended September 30, 1996).

                   *iv    Notarial  Deed,   dated  November  27,  1996  (Exhibit
                          (15)iv,  designated  as  Exhibit  EX-99-12  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1996).

   *  Incorporated herein by reference as indicated





EXHIBITS (Continued)


         (17)     Power Development, s.r.o.

                    *i    Founding  Notarial  Deed,  dated May 4, 1994  (Exhibit
                          (16)i,   designated  as  Exhibit  EX-99-13  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1996).

                   *ii    Notarial  Deed,  dated June 28, 1996 (Exhibit  (16)ii,
                          designated  as Exhibit  EX-99-14  for EDGAR  purposes,
                          Form U5S/A for fiscal year ended September 30, 1996).

                  *iii    Notarial  Deed,   dated  November  27,  1996  (Exhibit
                          (16)iii,  designated  as  Exhibit  EX-99-15  for EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1996).

         (18)     Teplarna Kromeriz a.s.

                    *i    Statutes, dated June 1996 (Exhibit (17), designated as
                          Exhibit  EX-99-16 for EDGAR  purposes,  Form U5S/A for
                          fiscal year ended September 30, 1996).

         (19)  Severoceske Teplarny, a.s.

                    *i    Articles of Association, dated April 24, 1997 (Exhibit
                          (20)i,   designated  as  Exhibit   EX99-11  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1997).

         (20)     Teplarna Liberec, a.s.

                    *i    Founding  Contract,  dated  November 11, 1994 (Exhibit
                          (21)i,   designated  as  Exhibit   EX99-12  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1997).

                   *ii    Notarial  Record,  dated  November  11, 1994  (Exhibit
                          (21)ii,   designated  as  Exhibit  EX99-13  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1997).

                  *iii    Articles  of the  Association,  dated  June  12,  1997
                          (Exhibit  (21)iii,  designated as Exhibit  EX99-14 for
                          EDGAR  purposes,  Form  U5S/A for  fiscal  year  ended
                          September 30, 1997).

         (21)     Zateca teplarenska, a.s.

                    *i    Foundation  Charter,  dated  December 4, 1995 (Exhibit
                          (23)i,   designated  as  Exhibit   EX99-17  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1997).

                   *ii    Articles  of  Association,   dated  December  4,  1995
                          (Exhibit  (23)ii,  designated  as Exhibit  EX99-18 for
                          EDGAR  purposes,  Form  U5S/A for  fiscal  year  ended
                          September 30, 1997).

                  Note:  Zatecka teplarenska, a.s. was sold by Severoceske
                         Teplarny, a.s. during the fiscal year ended September 30,
                         2000.

* Incorporated herein by reference as indicated.





EXHIBITS (Continued)


         (22)     SCT Softmaker, s.r.o.

                    *i    Notarial  Record,  dated  September  24, 1996 (Exhibit
                          (24)i,   designated  as  Exhibit   EX99-19  for  EDGAR
                          purposes,  Form U5S/A for fiscal year ended  September
                          30, 1997).

         (23)     Teplo Branany, s.r.o.

                    *i    Partnership   Agreement,   dated  November  18,  1997.
                          (Exhibit  (28)i,  designated as Exhibit 99-4 for EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1998).

         (24)     Jablonecka teplarenska a realitni, a.s.

                    *i    Articles of Association. (Exhibit (29)i, designated as
                          Exhibit EX99-5 for EDGAR purposes, Form U5S for fiscal
                          year ended September 30, 1998).

         (25)     Lounske tepelne hospodarstvi, s.r.o.

                    *i     Notarial Records, dated November 12, 1998, January 6,
                           1999 and  December  2,  1999.  Designated  as Exhibit
                           EX-99-6 for EDGAR purposes,  Form U5S for fiscal year
                           ended September 30, 1999.

         (26)     Prvni severozapadni teplarenska, a.s.

                    *i    Notarial Record, dated April 28, 1992. (Exhibit (30)i,
                          designated as Exhibit EX99-6 for EDGAR purposes,  Form
                          U5S for fiscal year ended September 30, 1998).

                   *ii    Articles  of   Association,   dated  April  28,  1992.
                          (Exhibit  (30)ii,  designated  as  Exhibit  EX99-7 for
                          EDGAR  purposes,   Form  U5S  for  fiscal  year  ended
                          September 30, 1998).

         (27)     ENOP, s.r.o.

                    *i    Founders  Deed,  dated  December  19,  1995.  (Exhibit
                          (31)i,   designated   as  Exhibit   EX99-8  for  EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1998).

         (28)     United Energy, a.s.

                     i    Notarial Record from Prvni severozapadni teplarenska,
                          a.s., dated September 28, 1998.  Designated as Exhibit
                          EX-99-3 for EDGAR purposes.

                    ii    Notarial Record from Severoceske Teplarny, a.s. dated
                          September 28, 1998.  Designated as Exhibit EX-99-4
                          for EDGAR purposes.

                   iii    Court Resolution Dated December 9, 1999.  Designated
                          as Exhibit EX-99-5 for EDGAR purposes.

                    iv    Court Resolution Dated July 17, 2000.  Designated as
                          Exhibit EX-99-6 for EDGAR purposes.

         (29)     Upstate Energy Inc. (formerly known as Niagara Energy Trading
                  Inc.)

                    *i    Restated   Certificate  of  Incorporation  of  Niagara
                          Energy  Trading  Inc.,  dated May 19,  1998.  (Exhibit
                          (32)i,   designated   as  Exhibit   EX99-9  for  EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1998).

                   *ii    By-Laws as amended August 24, 1999.  (Exhibit  (32)ii,
                          designated as Exhibit EX-99-7 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1999.)



* Incorporated herein by reference as indicated.





EXHIBITS (Continued)

         (30)     Roystone Gas Processing Plant Partnership

                    *i    Facility   Construction,   Ownership   and   Operating
                          Agreement,  dated  November 1, 1994.  (Exhibit  (33)i,
                          designated as Exhibit EX-99-8 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1999.)

                   *ii    Ratification  and Joinder of Roystone  Gas  Processing
                          Plant Facility  Construction,  Ownership and Operating
                          Agreement and Related Agreements,  dated September 30,
                          1999.  (Exhibit (33)ii,  designated as Exhibit EX-99-9
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1999.)

         (31)     Niagara Independence Marketing Company

                    *i    Certificate of Incorporation  dated September 17, 1997
                          (Exhibit (27)i, designated as exhibit EX99-3 for EDGAR
                          purposes, Form U5S for fiscal year ended September 30,
                          1997).

                   *ii    By-Laws  amended  March  11,  1998.  (Exhibit  (33)ii,
                          designated at Exhibit EX99-11 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1998).

                  *iii    Marketing  Partnership  Agreement  among  Coastal  Gas
                          Marketing   DirectLink  Corp.,  MGS  Marketing  Corp.,
                          Niagara  Independence  Marketing  Company and Williams
                          Independence   Marketing   Company  (Exhibit  (27)iii,
                          designated as Exhibit EX-99-5 for EDGAR purposes, Form
                          U5S for fiscal year ended September 30, 1997).

         (32)     Seneca Independence Pipeline Company

                    *i    Certificate of Incorporation of Empire Oklahoma,  Inc.
                          dated April 16, 1996  (Exhibit  (28)i,  designated  as
                          Exhibit  EX-99-6  for  EDGAR  purposes,  Form  U5S for
                          fiscal year ended September 30, 1997).

                   *ii    Certificate    of   Amendment   of    Certificate   of
                          Incorporation of Empire Oklahoma,  Inc. dated July 24,
                          1997 (Exhibit  (28)ii,  designated as exhibit  EX-99-7
                          for EDGAR  purposes,  Form U5S for  fiscal  year ended
                          September 30, 1997).

                  *iii    By-Laws amended September 20, 1999.  (Exhibit (35)iii,
                          designated  as Exhibit  EX-99-10  for EDGAR  purposes,
                          Form U5S for fiscal year ended September 30, 1999.)

         (33)     National Fuel Exploration Corp.

                     i    Certificate   of   Amalgamation    and   Articles   of
                          Amalgamation  dated  June  16,  2000.   Designated  as
                          Exhibit EX-99-7 for EDGAR purposes.

                    ii    By-Laws  No. 1 dated  April 28,  2000.  Designated  as
                          Exhibit EX-99-8 for EDGAR purposes.


* Incorporated herein by reference as indicated.






EXHIBITS (Continued)

   C.    Indentures

         *   Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York (formerly  Irving Trust Company)  (Exhibit 2(b) in
             File No. 2-51796).

         *   Third  Supplemental  Indenture  dated as of  December  1, 1982,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York (formerly  Irving Trust Company)  (Exhibit 4(a)(4)
             in File No. 33-49401).

         *   Tenth  Supplemental  Indenture  dated as of  February  1, 1992,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York  (formerly  Irving Trust  Company)  (Exhibit 4(a),
             Form 8-K dated February 14, 1992 in File No. 1-3880).

         *   Eleventh  Supplemental  Indenture  dated  as of  May  1,  1992,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York  (formerly  Irving Trust  Company)  (Exhibit 4(b),
             Form 8-K dated February 14, 1992 in File No. 1-3880).

         *   Twelfth  Supplemental  Indenture  dated  as of  June  1,  1992,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York  (formerly  Irving Trust  Company)  (Exhibit 4(c),
             Form 8-K dated June 18, 1992 in File No. 1-3880).

         *   Thirteenth  Supplemental  Indenture  dated as of March 1, 1993,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York (formerly Irving Trust Company)  (Exhibit 4(a)(14)
             in File No. 33-49401).

         *   Fourteenth  Supplemental  Indenture  dated as of July 1,  1993,  to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York (formerly Irving Trust Company) (Exhibit 4.1, Form
             10-K for fiscal year ended September 30, 1993 in File No. 1-3880).

         *   Fifteenth  Supplemental  Indenture dated as of September 1, 1996 to
             Indenture dated as of October 15, 1974, between the Company and The
             Bank of New York (formerly Irving Trust Company) (Exhibit 4.1, Form
             10-K for fiscal year ended September 30, 1996 in File No. 1-3880).

         *   Indenture  dated as of October 1, 1999  between the Company and the
             Bank of New York  (Exhibit 4.1, Form 10-K for the fiscal year ended
             September 30, 1999 in File No. 1-3880).

         *   Officers Certificate  Establishing  Medium-Term Notes dated October
             14,  1999  (Exhibit  4.2,  Form  10-K  for the  fiscal  year  ended
             September 30, 1999 in File No. 1-3880).

         *   Amended and Restated  Rights  Agreement  dated as of April 30, 1999
             between  National Fuel Gas Company and HSBC Bank USA (Exhibit 10.2,
             Form 10-Q for the quarterly period ended March 31, 1999 in File No.
             1-3880).


* Incorporated herein by reference as indicated.





EXHIBITS (Continued)


   D.             Tax Allocation Agreement pursuant to Rule 45(c).  Designated
                  as Exhibit EX-99-9 for EDGAR purposes.

   E.   *(1)      Employee  Relocation  Manual filed pursuant to Rule 48(b)
                  (Exhibit  E(1),   designated  as  Exhibit  EX-99-9  for  EDGAR
                  purposes, Form U5S for fiscal year ended September 30, 1997).

        *(2)      National  Fuel  Employee   Computer   Purchase  Program  filed
                  pursuant to Rule 48(b).  (Exhibit E(2),  designated as Exhibit
                  EX99-15  for EDGAR  purposes,  Form U5S for fiscal  year ended
                  September 30, 1998).

         (3)      Independence  Pipeline Company Unaudited Financial  Statements
                  for the quarter and  year-to-date  period  ended  December 31,
                  1999 and the quarter and  year-to-date  period ended September
                  30,  2000  filed  pursuant  to Rule 16.  These  documents  are
                  subject to a request  for  confidential  treatment  under Rule
                  104(b) of the Public Utility Holding Company Act of 1935.

   F.     Schedules of Supporting Items of this Report - None.

   G.     Financial Data Schedules. (Designated as Exhibit EX-27 for EDGAR
          purposes.)

   H.    *(1)    Organization chart showing relationship to Teplarna Kromeriz,
                 a.s., a foreign utility company  (Exhibit H(1), designated as
                 Exhibit EX99-16 for EDGAR purposes, Form U5S for fiscal year
                 ended September 30, 1998).

          (2)    Organization chart showing relationship to United Energy, a.s.,
                 a foreign utility company, formed from the merger of
                 Severoceske teplarny, a.s. and Prvni severozapadni teplarenska,
                 a.s. during fiscal 2000.  Designated as Exhibit EX-99-10 for
                 EDGAR purposes.

         *(3)    Organization chart showing  relationship to NFR Power, Inc., an
                 exempt  wholesale  generator.   (Exhibit  H(4),  designated  as
                 Exhibit  EX99-13 for EDGAR  purposes,  Form U5S for fiscal year
                 ended September 30, 1999.)

   I.     (1)    SCT Audited Financial Statements for the Calendar Year Ended
                 December 31, 1999.  Designated as Exhibit EX-99-11 for EDGAR
                 purposes.

          (2)    TL Audited Financial Statements for the Calendar Year Ended
                 December 31, 1999. Designated as Exhibit EX-99-12 for EDGAR
                 purposes.


* Incorporated herein by reference as indicated.






   EXHIBITS (Concluded)

          (3)    PSZT Audited Financial Statements for the Calendar Year Ended
                 December 31, 1999.  Designated as Exhibit EX-99-13 for EDGAR
                 purposes.

          (4)    Kromeriz Audited Financial Statements for the Calendar Year
                 Ended December 31, 1999.  Designated as Exhibit EX-99-14 for
                 EDGAR purposes.

          (5)    NFR Power, Inc. Audited Financial Statements for the Fiscal
                 Year Ended September 30, 2000.  These financial statements will
                 be filed by amendment when available.

* Incorporated herein by reference as indicated.





                                S I G N A T U R E


         The undersigned System company has duly caused this annual report to be
signed on its behalf by the undersigned  thereunto duly  authorized  pursuant to
the requirements of the Public Utility Holding Company Act of 1935.




                            NATIONAL FUEL GAS COMPANY





                                        By: /s/Joseph P. Pawlowski
                                           -------------------------------
                                            Joseph P. Pawlowski, Treasurer
                                            and Principal Accounting Officer

Date:  January 29, 2001





                                  EXHIBIT INDEX

EX27-1          Financial Data Schedule of National Fuel Gas Company for period
                ending September 30, 2000

EX27-2          Financial Data Schedule of National Fuel Gas Distribution
                Corporation for period ending September 30, 2000

EX99-1          By-Laws, as amended June 15, 2000, of National Fuel Gas Company

EX99-2          Articles of Amendment of the Articles of the Corporation of
                Highland Forest Resources, Inc. dated June 8, 2000

EX99-3          Notarial Record from Prvni severozapadni teplarenska, a.s. dated
                September 30, 1998.

EX99-4          Notarial Record from Severoceske Teplarny as. dated
                September 28, 1998.

EX99-5          Court Resolution Dated December 9, 1999.

EX99-6          Court Resolution Dated July 17, 2000.

EX99-7          Articles of Amalgamation of National Fuel Exploration, Inc.
                dated June 16, 2000

EX99-8          By-Laws No. 1 of National Fuel Exploration, Inc. dated April 28,
                2000

EX99-9          Tax Allocation Agreement pursuant to Rule 45(c)

EX99-10         Organization Chart Showing Relationship to United Energy, a.s.

EX99-11         SCT Audited Financial Statements for the Calendar Year Ended
                December 31, 1999

EX99-12         TL Audited Financial Statements for the Calendar Year Ended
                December 31, 1999

EX99-13         PSZT Audited Financial Statements for the Calendar Year Ended
                December 31, 1999

EX99-14         Kromeriz Audited Financial Statements for the Calendar Year
                Ended December 31, 1999

EX-27

WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

 


<ARTICLE>                                           UT
<LEGEND>
     THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NATIONAL
FUEL GAS  COMPANY'S  CONSOLIDATED  FINANCIAL  STATEMENTS  AND  SCHEDULES  AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.


<MULTIPLIER>                                   1,000

                             
<PERIOD-TYPE>                   12-mos
<FISCAL-YEAR-END>                              SEP-30-2000
<PERIOD-START>                                 OCT-01-1999
<PERIOD-END>                                   SEP-30-2000
<BOOK-VALUE>                                   PER-BOOK
<TOTAL-NET-UTILITY-PLANT>                      2,683,391
<OTHER-PROPERTY-AND-INVEST>                    0
<TOTAL-CURRENT-ASSETS>                         324,271
<TOTAL-DEFERRED-CHARGES>                       12,497
<OTHER-ASSETS>                                 216,729
<TOTAL-ASSETS>                                 3,236,888
<COMMON>                                       39,330
<CAPITAL-SURPLUS-PAID-IN>                      452,217
<RETAINED-EARNINGS>                            525,847
<TOTAL-COMMON-STOCKHOLDERS-EQ>                 987,437
<PREFERRED-MANDATORY>                          0
<PREFERRED>                                    0
<LONG-TERM-DEBT-NET>                           953,622
<SHORT-TERM-NOTES>                             419,502
<LONG-TERM-NOTES-PAYABLE>                      0
<COMMERCIAL-PAPER-OBLIGATIONS>                 200,000
<LONG-TERM-DEBT-CURRENT-PORT>                  11,262
<PREFERRED-STOCK-CURRENT>                      0
<CAPITAL-LEASE-OBLIGATIONS>                    0
<LEASES-CURRENT>                               0
<OTHER-ITEMS-CAPITAL-AND-LIAB>                 665,065
<TOT-CAPITALIZATION-AND-LIAB>                  3,236,888
<GROSS-OPERATING-REVENUE>                      1,425,277
<INCOME-TAX-EXPENSE>                           77,068
<OTHER-OPERATING-EXPENSES>                     1,129,941
<TOTAL-OPERATING-EXPENSES>                     1,207,009
<OPERATING-INCOME-LOSS>                        218,268
<OTHER-INCOME-NET>                             10,408
<INCOME-BEFORE-INTEREST-EXPEN>                 228,676
<TOTAL-INTEREST-EXPENSE>                       100,085
<NET-INCOME>                                   127,207
<PREFERRED-STOCK-DIVIDENDS>                    0
<EARNINGS-AVAILABLE-FOR-COMM>                  127,207
<COMMON-STOCK-DIVIDENDS>                       73,877
<TOTAL-INTEREST-ON-BONDS>                      61,781
<CASH-FLOW-OPERATIONS>                         238,246
<EPS-BASIC>                                    3.25
<EPS-DILUTED>                                  3.21



 

EX-27

WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.

 


<ARTICLE>                                           UT
<LEGEND>
     THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM NATIONAL
FUEL GAS DISTRIBUTION CORPORATION'S FINANCIAL STATEMENTS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.

<MULTIPLIER>                                   1,000

                             
<PERIOD-TYPE>                   12-MOS
<FISCAL-YEAR-END>                              SEP-30-2000
<PERIOD-START>                                 OCT-01-1999
<PERIOD-END>                                   SEP-30-2000
<BOOK-VALUE>                                   PER-BOOK
<TOTAL-NET-UTILITY-PLANT>                      939,752
<OTHER-PROPERTY-AND-INVEST>                    0
<TOTAL-CURRENT-ASSETS>                         162,567
<TOTAL-DEFERRED-CHARGES>                       1,475
<OTHER-ASSETS>                                 115,702
<TOTAL-ASSETS>                                 1,219,496
<COMMON>                                       59,170
<CAPITAL-SURPLUS-PAID-IN>                      121,669
<RETAINED-EARNINGS>                            305,654
<TOTAL-COMMON-STOCKHOLDERS-EQ>                 486,493
<PREFERRED-MANDATORY>                          0
<PREFERRED>                                    0
<LONG-TERM-DEBT-NET>                           299,259
<SHORT-TERM-NOTES>                             83,000
<LONG-TERM-NOTES-PAYABLE>                      0
<COMMERCIAL-PAPER-OBLIGATIONS>                 0
<LONG-TERM-DEBT-CURRENT-PORT>                  712
<PREFERRED-STOCK-CURRENT>                      0
<CAPITAL-LEASE-OBLIGATIONS>                    0
<LEASES-CURRENT>                               0
<OTHER-ITEMS-CAPITAL-AND-LIAB>                 350,032
<TOT-CAPITALIZATION-AND-LIAB>                  1,219,496
<GROSS-OPERATING-REVENUE>                      846,459
<INCOME-TAX-EXPENSE>                           38,362
<OTHER-OPERATING-EXPENSES>                     720,302
<TOTAL-OPERATING-EXPENSES>                     758,664
<OPERATING-INCOME-LOSS>                        87,795
<OTHER-INCOME-NET>                             1,522
<INCOME-BEFORE-INTEREST-EXPEN>                 89,317
<TOTAL-INTEREST-EXPENSE>                       31,655
<NET-INCOME>                                   57,662
<PREFERRED-STOCK-DIVIDENDS>                    0
<EARNINGS-AVAILABLE-FOR-COMM>                  57,662
<COMMON-STOCK-DIVIDENDS>                       34,800
<TOTAL-INTEREST-ON-BONDS>                      0
<CASH-FLOW-OPERATIONS>                         72,166
<EPS-BASIC>                                    0
<EPS-DILUTED>                                  0




 

EX-3

                                                              Amended  2/21/85
                                                                       6/19/86
                                                                       7/07/88
                                                                       6/14/90
                                                                       6/18/92
                                                                       12/8/93
                                                                       6/09/94
                                                                       9/19/96
                                                                       1/01/97
                                                                       3/20/97
                                                                       6/19/97
                                                                       9/18/97
                                                                       9/17/98
                                                                       6/17/99
                                                                       9/16/99
                                                                       2/17/00
                                                                       6/15/00

BY-LAWS

ARTICLE I

Meeting of Stockholders

        1.    Meetings of stockholders may be held at such place, within or without the State of New Jersey, as may be fixed by the Board of Directors and stated in the notice of the meeting.

        2.    In 1999 and thereafter, the annual meeting of stockholders shall be held on the third Thursday in February in each year beginning at ten o’clock in the forenoon, local time, unless such day shall be on a holiday, in which event such meeting shall be held at the same hour on the next succeeding business day. In 1998, the Annual Meeting of Stockholders shall be held on Thursday, February 26, 1998 at ten o’clock in the forenoon, local time.

        3.    Except as otherwise provided by New Jersey law, written notice of the time, place and purpose or purposes of every meeting of stockholders shall be given not less than 10 nor more than 60 days before the date of the meeting, either personally or by mail, to each stockholder of record entitled to vote at the meeting.

        4.    Unless otherwise provided by statute, all Special Meetings shall be called upon the written request of three or more directors or of stockholders owning one-fourth of the capital stock issued and outstanding.

        5.    Unless otherwise provided in the Company’s Certificate of Incorporation or in New Jersey law, (i) the holders of shares entitled to cast a majority of the votes at any meeting of stockholders shall constitute a quorum at such meeting except that the votes that holders of any class or series of shares are entitled to cast shall not be counted in the determination of a quorum for action to be taken at a meeting with respect to which such class or series has no vote, and (ii) the holders of shares of any class or series entitled to cast a majority of the votes of such class or series entitled to vote separately on a specified item of business shall constitute a quorum of such class or series for the transaction of such specified item of business.

               If a quorum shall not be so represented, the stockholders present at any meeting of stockholders shall have power to adjourn the meeting to another time at the same or at another place. If the time and place to which the meeting is adjourned are announced at the meeting at which the adjournment is taken and at the adjourned meeting only such business is transacted as might have been transacted at the original meeting, it shall not be necessary to give notice of the adjourned meeting unless after the adjournment the Board of Directors fixes a new record date for the adjourned meeting. In the event the Board of Directors fixes such a new record date, a notice of the adjourned meeting shall be given to each stockholder of record at the new record date entitled to notice under Article I paragraph 3 of these By-Laws.

         6.     At each election of Directors, the proxies and ballots shall be received and all questions respecting the qualification of voters shall be decided by two inspectors, who shall be appointed by the presiding officer of the meeting; provided however, that no candidate for election as Director shall act as inspector. Such inspectors shall be sworn faithfully to perform their duties and shall report in writing the results of the ballot.,

         7.    A.  Business transacted at an annual meeting of stockholders may include all such business as may properly come before the meeting. Nominations of persons for election to the Board of Directors and the proposal of business to be considered by the stockholders may be made at an annual meeting of stockholders:

                        (i)    pursuant to the Corporation's notice of meeting;

                       (ii)    by or at the direction of the Board of Directors; or

                      (iii)    by any stockholder who was a stockholder of record at the time of giving of notice of the meeting,
                               who is entitled to vote at the meeting and who complies with the notice procedures set forth in this                                Section 7.

               B.    For nominations or other business to be properly brought before an annual meeting by a stockholder, the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation and such other business must otherwise be a proper matter for stockholder action. Such stockholder's notice shall set forth:

                        (i)    as to each person whom the stockholder proposes to nominate for election or reelection as a
                               director:

                                (a)    the name, age, business address of such person,

                                (b)     the principal occupation of employment of such person,

                                (c)    the class and number of shares of the Corporation which are owned beneficially by such
                                         person, and

                                (d)    all other information relating to such person that is required to be disclosed in solicitations of
                                         proxies for election of directors in an election contest, or is otherwise required, in each case
                                         under applicable SEC regulations (as of February 1999, Regulation 14A under the Securities
                                         Exchange Act of 1934, as amended, and Rule 14a-11 thereunder), including such person’s
                                         written consent to being named in the proxy statement as a nominee and to serving as a
                                         director if elected;

                       (ii)     as to any other business that the stockholder proposes to bring before the meeting,
                                a brief description of the business desired to be brought before the meeting, the reasons for
                                conducting such business at the meeting and any material interest in such business of such
                                stockholder and the beneficial owner, if any, on whose behalf the proposal is made; and

                     (iii)     as to the stockholder giving the notice and the beneficial owner, if any, on whose behalf the
                                nomination or proposal is made:

                               (a)    the name and address of such stockholder, as they appear on the Corporation's books, and of
                                       such beneficial owner, and

                               (b)    the class and number of shares of the Corporation which are owned beneficially and of record
                                       by such stockholder and such beneficial owner.

               C.    To be timely, a stockholder's notice under this Section 7 must be delivered to the Secretary at the principal executive offices of the Corporation not less than 110 days prior to the date corresponding to the date on which the Corporation first mailed its proxy materials for the prior year's annual meeting of stockholders; provided, however, that if both:

                        (i)    the date of the annual meeting is changed more than 30 days from the date corresponding to the
                                date of the prior year’s annual meeting; and

                        (ii)    notice (or, if earlier, public disclosure of the date of the annual meeting) is given or made to the
                                stockholders of the Corporation less than 120 days before the date corresponding to the date on
                                which the Corporation first mailed its proxy materials for the prior year’s meeting of stockholders;
                                then

                      (iii)    a stockholder’s notice to be timely must be so received not later than the close of business on
                                the tenth day following the date on which such notice (or, if earlier, such public disclosure of the
                                date of the annual meeting) was mailed or made by the Corporation.

                                In no event shall the public announcement of an adjournment of an annual meeting commence a
                                new time period for the giving of a stockholder’s notice under this Section 7.

               D.    Only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with the procedures set forth in this Section 7. Other than persons nominated by the full Board or any nominating committee thereof, only such persons who are nominated in accordance with the procedures set forth in this Section 7 shall be eligible to serve as directors. The chairman of the meeting shall have the power and duty to determine whether a nomination or any business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with the procedures set forth in this Section 7 and, if any proposed nomination or business is not in compliance with this Section 7, to declare that such defective proposal or nomination shall be disregarded, unless otherwise provided by any applicable law.

               E.    Notwithstanding the foregoing provisions of this Section 7, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 7. Nothing in this Section 7 shall be deemed to affect any rights of:

                        (i)    the stockholders to request inclusion of proposals in the Corporation's proxy statement pursuant
                                to Rule 14a-8 under the Exchange Act; or

                       (ii)    the holders of any series of Preferred Stock to elect directors under specified circumstances.

               F.    Business transacted at a special meeting of the stockholders shall be limited to the purposes set forth in the notice of the special meeting.

               G.    For purposes of this Section 7, the term "public disclosure" shall mean disclosure in a news release reported by the Dow Jones News Service, the Associated Press or a comparable national news service, or in a document publicly filed by the Corporation with the Securities and Exchange Commission pursuant to Section 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended.

         8.     At each meeting of stockholders, the chairman of the meeting shall fix and announce the date and time of the opening and the closing of the polls for each matter upon which the stockholders will vote at the meeting and shall determine the order of business and all other matters of procedure. The Board of Directors may adopt by resolution such rules and regulations for the conduct of meetings of stockholders as it shall deem appropriate. Except to the extent inconsistent with any such rules and regulations as adopted by the Board of Directors, the chairman of the meeting may establish rules, which need not be in writing, to maintain order and safety and for the conduct of the meeting. Without limiting the foregoing, the chairman of the meeting may:

               A.    Determine and declare to the meeting that any business is not properly before the meeting and therefore shall not be considered;

               B.    Restrict attendance at any time to bona fide shareholders of record and their proxies and other persons in attendance at the invitation of the chairman of the meeting;

               C.     Restrict dissemination of solicitation materials and use of audio or visual recording devices at the meeting;

               D.    Adjourn the meeting without a vote of the stockholders, whether or not there is a quorum present; and

               E.    Make rules governing speeches and debate, including time limits and access to microphones.

ARTICLE II

Board of Directors

         1.     The Board of Directors shall consist of (i) such number of directors, not less than seven nor more than eleven, as may be determined from time to time by resolution adopted by the affirmative vote of a majority of the entire Board of Directors, and (ii) such directors as may be elected by vote of the holders of shares of preferred stock, when and as provided in the Certificate of Incorporation of the Company. In order to qualify for election as a director, a nominee must be a shareholder of the Company.

         2.     Subject to the provisions of the Statutes of the State of New Jersey, the Certificate of Incorporation, and the By-Laws of the Corporation, the Board of Directors shall have full and complete management and control of the business and affairs of the Corporation.

         3.     The Board of Directors may hold its meetings or any adjournment thereof either in the State of New Jersey or elsewhere and keep the books of the Corporation at such places within or without the State of New Jersey as the Board of Directors may from time to time determine.

         4.     Meetings of the Board of Directors may be called at the direction of the Chairman of the Board, the President, or any three of the Directors for the time being in office.

         5.     Notice of any meetings of the Board of Directors shall be given to each Director by mailing the same to him at his last known address, as the same appears upon the records of the Corporation at least five days before the meeting or by telegraphing, telephoning or delivering the same to him personally at least one day before the meeting.

         6.     At any meeting of the Board of Directors, there may be transacted without special notice, any business within the powers of the Directors to transact, except that of which the Statutes of the State of New Jersey expressly require special notice shall be given.

         7.     A.    A majority of the Directors in office shall constitute a quorum for the transaction of any business which may properly come before them. If a majority of said Directors shall not be present at any meeting, the Directors present shall have power to adjourn to a day certain, and notice of the adjourned meeting shall be given by mailing the same addressed to each Director at his address as the same appears upon the records of the Corporation, at least two days prior to the adjourned meeting, or by telegraphing, telephoning or delivering the same to him personally at least one day before said adjourned meeting. But, if a majority of the Board of Directors are present, the said meeting, or any adjourned meeting thereof, may be adjourned to a subsequent day; such adjournment may be without notice of such adjournment if such notice is not required by New Jersey Law (as of June 1997, N.J.S.A. 14A:6-10(2)).>

                 B.    Unless a greater vote is required by applicable law or by the Certificate of Incorporation of the Company or these By-laws (including, but not limited to, subparagraph C of this paragraph 7), any action approved by a majority of the votes of directors present at a meeting at which a quorum is present shall be the act of the Board of Directors.

                 C.    Anything in these By-laws to the contrary notwithstanding, any action taken by the Board of Directors pursuant to the terms of any Rights Plan (as hereinafter defined) of the Company shall, unless otherwise provided by the terms of the Rights Plan, be approved by the affirmative vote of three-fourths (3/4ths) of the entire Board of Directors. For purposes of these By-laws, the term "Rights Plan" shall mean any plan pursuant to which shareholders of the Company are, upon the occurrence of certain specified events (including, but not limited to, the acquisition by any person of a specified number of shares of capital stock of the corporation), entitled to purchase shares of capital stock or other securities of either the Company or the acquiring person at a discounted price.

         8.     A.   The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any pending, threatened or completed civil, criminal, administrative or arbitrative action, suit or proceeding, and any appeal therein and any inquiry or investigation which could lead to such action, suit or proceeding (“Proceeding”) by reason of the fact that such person is or was a director or officer of the Corporation, or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, trustee, employee or agent of another foreign or domestic corporation, or of any partnership, joint venture, sole proprietorship, employee benefit plan, trust or other enterprise, whether or not for profit, to the fullest extent permitted and in the manner provided by the laws of the State of New Jersey.

                 B.   Nothing in this paragraph 8 shall restrict or limit the power of the Corporation to indemnify its employees, agents and other persons, to advance expenses (including attorneys' fees) on their behalf and to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation in connection with any Proceeding.

                 C.   The indemnification provided by this paragraph 8 shall not exclude any other rights to which a person seeking indemnification may be entitled under the Certificate of Incorporation, By-Laws, agreement, vote of shareholders or otherwise. The indemnification provided by this paragraph 8 shall continue as to a person who has ceased to be a director or officer, and shall extend to the estate or personal representative of any deceased director or officer.

         9.     A.   Each Director who is not a regular full-time employee of the Corporation or one or more of its subsidiaries, shall be paid an annual fee of $14,000 in cash and 480 shares of the common stock of the Corporation, payable in equal quarterly increments, in advance (i.e., as of the first business day of the quarter). There will be proration of payments during quarters in which such Director has only partial service. Each such share of stock of the Corporation will be non-transferable until the later of two years from its issuance or six months after such Director’s cessation of service.

                 B.   Each Director of the Corporation who is not a regular full-time employee of the Corporation or one or more of its subsidiaries shall also receive a fee of $1,200 for attendance at any meeting of the Board of Directors and a fee of $800 for attendance at any meeting of any committee of the Board of Directors, except that if a Director participates in a committee meeting by telephone, the fee shall be $500. Also a Director who is not a regular full-time employee of the Corporation or one or more of its subsidiaries and who has been appointed as Chairman of any committee of the Board of Directors shall be paid an annual retainer fee of $3,000 for assuming these additional responsibilities. This retainer shall be paid July 1 of each year. Each Director shall be reimbursed for the travel expenses incurred by him or her in attending any meeting of the Board of Directors or any committee of the Board of Directors.

                 C.   Each Director of the Corporation who is not a regular full-time employee of the Corporation or one or more of its subsidiaries shall be paid $600 for each special consultation as a Director that is with or at the request of the Corporation's Chief Executive Officer.

        10.     Any contract or other transaction between the Corporation or a subsidiary of the Corporation and any other entity shall not be void or voidable because a Director of the Corporation is interested therein if the Corporation has complied with the provisions of any then-applicable New Jersey statute(s) necessary or sufficient to make the transaction not void or voidable, including, as of June 1997, N.J.S.A. 14A:6-8(1).

ARTICLE III

Officers

         1.     At the first meeting after the annual election, the Board of Directors shall choose a Chairman of the Board and a President, both of whom shall be members of the Board of Directors, and one or more Vice Presidents, a Secretary, a Treasurer and a Controller, who need not be members of the Board of Directors, and who shall hold their respective offices until others are chosen and qualify in their stead. The offices of Secretary and Treasurer may be filled by the same person.

         2.    In its discretion, the Board of Directors may leave unfilled for such period as it may determine, any office except the offices of the President, Treasurer and Secretary.

         3.     The Chairman of the Board shall be the Chief Executive Officer of the Corporation. He shall preside at all meetings of the Board of Directors and shall, during the recess of the Board of Directors, have general control and management of the affairs and business of the Corporation. The Chairman of the Board shall preside at stockholders’ meetings.

         4.     In addition to the duties and responsibilities specified in the laws of the State of New Jersey and these By-Laws, the President shall perform such other duties as from time to time may be assigned to him or her by the Board of Directors, and shall preside at stockholders’ meetings in the absence of the Chairman of the Board. In the absence of the Chairman of the Board, or in the event that there is a vacancy in the office of the Chairman of the Board, the President shall be the Chief Executive Officer of the Corporation and shall perform all the duties of the Chairman of the Board as well as those of President.

         5.    Each Vice President shall perform such duties as shall from time to time be assigned to him by the Board of Directors, the Chairman of the Board, or the President.

         6.     The Secretary, in addition to his statutory duties, shall give proper notice of all meetings of the stockholders and of the Board of Directors. He shall act as Secretary of all meetings of the stockholders and shall perform such other duties as shall from time to time be assigned to him by the Board of Directors or President.

         7.     The Treasurer, in addition to his statutory duties, shall keep full and accurate accounts of receipts and disbursements of the funds belonging to the Corporation, and shall cause to be deposited all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may from time to time be designated by the Board of Directors. He shall disburse the funds of the Corporation as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the President and Directors whenever they may require it, account of all his transactions as Treasurer, and of the financial condition of the Corporation. He shall perform such other duties as shall be assigned to him by the Board or President, and shall give a bond for the faithful discharge of his duties in such sum and with such surety or sureties as the Board of Directors may from time to time require.

         8.     The Controller shall see that adequate records of all assets, liabilities and transactions of the Corporation are maintained; that adequate audits thereof, are currently and regularly made, and in conjunction with other officers, initiate and enforce measures and procedures whereby the business of the Corporation shall be conducted with maximum efficiency, safety and economy. He shall also perform all such other duties as usually pertain to the office of Controller. He shall be in all matters subject to the control of and responsible to the Board of Directors alone.

         9.     The Board of Directors may from time to time appoint such other officers and agents as they may deem necessary or advisable for the transaction of the business of the Corporation, who shall hold their offices during the pleasure of the Board of Directors and perform such duties as may from time to time be designated or assigned to them by said Board of Directors.

        10.     If the office of the Chairman of the Board, the President, Vice President, Secretary, Treasurer, or Controller or one or more of them becomes vacant for any reason whatsoever, the Board of Directors at any duly convened meeting may, by a majority vote of those present, fill such vacancy and the person elected shall hold office for the unexpired term of such office and until his successor shall be chosen.

        11.     All officers and agents chosen or appointed by the Board of Directors shall be subject to removal by the Board of Directors at any time with or without cause, and in the case of the absence of any officer or agent of the Corporation, or for any other reason that may seem sufficient to the Board of Directors, the said Board of Directors subject to the limitations herein contained and the statutes in such case made and provided, may, without removal, delegate his powers and duties to any other officer or suitable person for such period as it shall deem proper.

        12.     All duly authorized bonds and debentures of the Corporation shall be signed on behalf of the Corporation by its Chairman of the Board or its President, or one of its Vice Presidents or, if so provided by resolution of the Board of Directors, by one or more of such officers and such other officer or officers designated by the Board of Directors; any or all such signatures may be manual or facsimile signatures, the signature on interest coupons attached to any said bonds or debentures shall be a facsimile signature; and the corporate seal or a facsimile of such seal may be impressed, affixed, imprinted or otherwise reproduced on said bonds and debentures and, if attested, shall be attested by the Corporation’s Secretary or Assistant Secretary by manual or facsimile signature. In case any person whose signature (manual or facsimile) appears upon any said bond or debenture or coupons attached thereto shall cease to be an officer of the Corporation, or shall cease to be the officer specified thereon, before the bonds or debentures so signed shall have been authenticated by the trustee under the indenture or other instrument pursuant to which the bonds or debentures are delivered or sold, such bonds or debentures or coupons may nevertheless be adopted by the Corporation, without further action by the Board of Directors, and authenticated and delivered and sold as though the person or persons who so signed or attested such bonds or debentures or coupons had not ceased to be an officer of the Corporation or the officer specified thereof; and any bonds or debentures may be signed as aforesaid; and the seal of the Corporation impressed, affixed, imprinted or otherwise reproduced thereon may be attested on behalf of the Corporation as aforesaid, and coupons attached may be signed as aforesaid by such persons as at the actual date of the execution of the bonds or debentures or coupons shall be the proper officers of the Corporations, although at the time of the date of the bonds or debentures, such persons may not have been officers of the Corporation.

ARTICLE IV

Executive Committee

         1.     The Directors may appoint an executive committee and one or more other committees of not less than three members to be chosen from among the members of the Board of Directors. Such committees may meet at such times and places as the committee shall, by resolution, determine and it shall make its own rules of procedure. A majority of the members of any such committee shall constitute a quorum.

         2.     Except as otherwise provided by Board resolution or statute (as of June 1997, N.J.S.A. 14A:6-9(1)), each such committee shall have and may exercise the power of the Board of Directors in the management of the business and affairs of the Corporation at any time when the Board of Directors are not in session. Each such committee shall, however, be subject to the specific directions of the Board of Directors.

         3.    Each such committee shall keep regular minutes of their transactions and shall cause them to be recorded in books to be kept for that purpose in the office of the Corporation, and shall report the same to the Board of Directors at their regular meetings.

ARTICLE V

Transfer of Shares

         1.     Except as otherwise provided by statute, shares evidenced by certificates shall be transferred on the books of the Corporation only by the holder thereof in person or by his attorney upon the surrender and cancellation of the certificate or certificates of a like number of shares, except in the case of lost or destroyed certificates, and in that case only after the receipt of a satisfactory bond.

         2.     The Board of Directors may appoint a transfer agent and a registrar of transfers, and may, in the case of shares represented by certificates, require all stock certificates to bear the signature of either or both.

ARTICLE VI

Fiscal Year

         1.    The fiscal year of the Corporation shall begin on the 1st day of October in each calendar year and end on the 30th day of September of the next succeeding year.

ARTICLE VII

Dividends and Working Capital

         1.     Before declaring any dividends or making any distribution of profits, the Directors may set apart out of the net profits or out of the surplus of the Corporation as a reserve fund to be used as working capital or for any other proper purpose, such sum or sums as the Directors shall in their discretion deem just and proper and most for the benefit of the Corporation.

         2.    Dividends upon the capital stock of the Corporation when declared shall be payable on dates to be determined by the Board of Directors.

ARTICLE VIII

Closing of Transfer Books and
Fixing A Record Book

         The Board of Directors may close the stock transfer books of the Corporation for a period not exceeding sixty days preceding the date of any meeting of stockholders or the date for payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect.

         In lieu of so closing the stock transfer books, the Board of Directors may fix, in advance, a date, not exceeding sixty days preceding the date of any meeting of stockholders, or the date for the payment of any dividend, or the date for the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, as a record date for the determination of the stockholders entitled to notice of, and to vote at, any such meeting, or entitled to receive payment of any such dividend, or any such allotment of rights, or to exercise the rights in respect to any such change, conversion or exchange of capital stock, and in such case only stockholders of record on the date so fixed shall be entitled to such notice of, and to vote at, such meeting, or to receive payment of such dividend, or allotment of rights or exercise of such rights, as the case may be, and notwithstanding any transfer of any stock on the books of the Corporation after any such record date fixed as aforesaid.

ARTICLE IX

Waiver of Notice

         1.    Any notice required to be given by these By-Laws may be waived by the person entitled thereto.

ARTICLE X

Seal

         1.     The common corporate seal is and until otherwise ordered by the Board of Directors shall be an impression upon paper or wax bearing the words - “NATIONAL FUEL GAS COMPANY, NEW JERSEY, INCORPORATED 1902".

ARTICLE XI

Amendment of By-Laws

         1.     Except as otherwise provided by statute, the Board of Directors shall have power to make, alter or repeal the By-Laws of the Corporation by a vote of a majority of all the Directors at any duly convened meeting of the Board, but any By-Laws so made or otherwise promulgated may be altered or repealed and new By-Laws made by the stockholders at any duly convened meeting thereof.

EX-99

                        PENNSYLVANIA DEPARTMENT OF STATE
                               CORPORATION BUREAU
                         ROOM 308 NORTH OFFICE BUILDING
                                  P.O. BOX 8722
                            HARRISBURG, PA 17105-8722



HIGHLAND FOREST RESOURCES, INC.




     THE  CORPORATION  BUREAU IS HAPPY TO SEND YOU YOUR FILED  DOCUMENT.  PLEASE
NOTE THE FILE DATE AND THE SIGNATURE OF THE SECRETARY OF THE  COMMONWEALTH.  THE
CORPORATION  BUREAU  IS HERE TO  SERVE  YOU AND  WANTS TO  THANK  YOU FOR  DOING
BUSINESS  IN  PENNSYLVANIA.   IF  YOU  HAVE  ANY  QUESTIONS  PERTAINING  TO  THE
CORPORATION BUREAU, CALL (717) 787-1057.

















                                                    ENTITY NUMBER: 0758903
                                                    MICROFILM NUMBER: 2000047

                                                    1165 - 1167





CSC NETWORKS
COUNTER





Microfilm Number __________      Filed with the Department of State JUN 08 2000
Entity Number  758903            /s/ Kim (illegible)
                                 Secretary of the Commonwealth

               ARTICLES OF AMENDMNET-DOMESTIC BUSINESS CORPORATION
                              DSCB:15-1915 (Rev 90)

     In compliance  with the  requirements  of 15 Pa.C.S.  ss. 1915 (relating to
articles of amendment), the undersigned business corporation,  desiring to amend
its Articles, hereby state that:

1.  The name of the corporation is:  Highland Land & Minerals, Inc.

2.    The (a) address of this  corporation's  current  registered office in this
      Commonwealth or (b) name of its commercial  registered office provider and
      the county of venue is (the Department is hereby authorized to correct the
      following information to conform to the records of the Department):


(a)      ________________________________________________________________
            Name and Street       City        State     Zip       County

(b)      c/o: Corporation Service Company                      Dauphin
            Name of Commercial Registered Office Provider        County

     For a corporation  represented by a commercial  registered office provider,
the county in (b) shall be deemed the county in which the corporation is located
for venue and official publication purposes.

3.   The statute by or under which it was incorporated is: _____________________

4.   The date of incorporation is:    August 19, 1982

5.   (Check, and if appropriate complete, one of the following):

     _X_The  amendment   shall  be  effective  upon  filing  these  Articles  of
        Amendment in the Department of State.

     ___ The amendment was shall be effective on:_____________at_______________
                                                    Date             Hour

6.   (Check one of the following):

     __  The amendment was adopted by shareholders (or members) pursuant to 15
         Pa.C.S. 1914(a) and (b).

      X  The amendment was adopted by the board of directors pursuant to 15
     --- Pa.C.S. 1914(c).

7.   (Check, and if appropriate complete, one of the following):

     ___ The  amendment  adopted by the  corporation,  set forth in full,  is as
follows:

       -------------------------------------------------------------------------

     _X_This  amendment  adopted  by the  corporation  is set  forth  in full in
        Exhibit A attached hereto and made a part hereof.

8.   (Check if the amendment restates the Articles):

     ___The restated  Articles of Incorporation  supersede the original Articles
        and all amendments thereto.

     IN TESTIMONY WHEREOF, the undersigned corporation has caused these Articles
of Amendment to be signed by a duly authorized  officer thereof this 30th day of
May, 2000.


                                            Highland Land & Minerals, Inc.
                                              (Name of Corporation)
                                            By:  /s/ J.A. Beck
                                                 (Signature)
                                            Title:  President






200047-1167
                                    EXHIBIT A

                         HIGHLAND LAND & MINERALS, INC.
                          Action by Board of Directors
                               In Lieu of Meeting



     The  undersigned,  being  all the  members  of the  Board of  Directors  of
HIGHLAND  LAND &  Minerals,  INC.  do hereby  consent,  pursuant to Section 9 of
Article II of the By-Laws and  pursuant to Section  1727(b) of the  Pennsylvania
Business  Corporation Law, to the adoption of the following resolution without a
meeting, on written consent:

                Resolved:   That, in accordance with the provisions of
                            15Pa.C.S. 1914(c), the Articles of the
                            Corporation are hereby amended to the
                            effect that the corporate name of Highland
                            Land & Minerals, Inc. shall be changed,
                            effective upon the filing the Articles of
                            Amendment in the Pennsylvania Department
                            of State, to HIGHLAND FOREST RESOURCES, INC.,
                            and

                            That, in all other respects,  said Articles shall be
                            and  remain  in  effect  as such  exist  on the date
                            hereof.

Dated as of May 26, 2000




EX-99
6
0006.txt
NOTARIAL RECORD FROM PRVNI SEVEROZAPADNI


                                    Duplicate

                                 Notarial record

written by me, JUDr.  Jaroslava  Mala of Most in m office at  Moskevska  1/14 in
Most this twenty-eighth day of September nineteen hundred and ninety-eight.

At the request of representatives of Prvni severozapadni teplarenska, a.s.. with
its registered  office in Komorany u Mostu, I have come to the stock corporation
in Komo0any u Mostu today where an extraordinary general meeting of this Company
took place.

I make the following

                                   attestation

regarding the course of deliberations of the Extraordinary General Meeting

1. The  deliberations of the  Extraordinary  General Meeting were opened by Ing.
Stefan  Pallay,  the Deputy  Chairman of the Board of Directors and the Managing
Director of the stock  corporation,  at 10:15 a.m.  He stated that  shareholders
owning 96.22 % of the Company's registered capital were present at the moment of
opening the Extraordinary  General Meeting,  according to the information of the
employees  authorized to tend the  attendance  list. The  Extraordinary  General
Meeting had, thus, a quorum.  Then he introduced  members of the Company's Board
of Directors and the Supervisory  Board. He also stated that the announcement of
the  Extraordinary  General  Meeting with its agenda was  published  pursuant to
Section 184  Subsections 4 and 5 of the  Commercial  Code and Article 20 para. 5
and 6 in national wide daily  newspapers,  namely in  Hospodarske  noviny and in
Mlada fronta Dnes and in the Commercial Bulletin on 26 August 1998. The decisive
day with regard to the attendance at the  Extraordinary  General  Meeting was 21
September 1998. The announcement of the Extraordinary  General Meeting contained
information  that the  shareholders  may study the  merger  documents  listed in
Section 69a  Subsection 7 of the  Commercial  Code, in the Company's  registered
office from 26 August 1998 till the  Extraordinary  General  Meeting on business
days from 10 a m. to 2 p.m..

The merger  project  prepared by the Boards of Directors  of both  participating
companies  (Prvni  severozapadni  teplarenska,  a.s., and Severoceske  teplarny,
a.s.) was published  pursuant to Section 69a Subsection 3 and Section 769 of the
Commercial  Code and Article 59 para.  1 of the Articles of  Association  in the
Commercial  Bulletin  and  pursuant  to Article 59 para.  1 of the  Articles  of
Association in Hospodarske noviny and Mlada fronta Dnes on 26August 1998.

The draft  resolution  of the  Extraordinary  General  Meeting on the merger was
published  pursuant  to  Section  220a  Subsection  9 and  Section  769  of  the
Commercial  Code and  Article 59 para 1 of the  Articles of  Association  in the
Commercial  Bulletin on 26August  1998 and  pursuant to Article 59 para 1 of the
Articles of Association in Hospodarske  noviny and Mlada fronta Dnes on the same
day.

The draft resolution of the Extraordinary  General Meeting that was to decide on
the merger was sent to all known  creditors  of the Company  pursuant to Section
220a para 9 of the Commercial Code on 26 August 1998.






                                     Page 2

The draft  resolution  was sent to 59 creditors of the Company as a hand-to-hand
delivery  by  registered  mail.  None of the  creditors  exercised  his right to
require  a  sufficient  security  of  his  receivables  as to  the  day  of  the
Extraordinary General Meeting.

Then Ing.  Stefan  Pallay  presented  the  agenda of the  Extraordinary  General
Meeting:

 1.      Approval of the Rules of Procedure and Voting,
 2.      Election of a Chairman, Deputy Chairman of the General Meeting, minutes
         clerks, minutes verifiers and vote counters,
 3.      Board of Directors' report on the extraordinary  financial statement as
         of 3O June 1998,
 4.      Supervisory  Board's report on a review of the extraordinary  financial
         statement,
 5.      Approval  of  the  extraordinary  financial  statement  reviewed  by an
         author,
 6.      Board of  Directors'  report  on the  project  of the  merger  of Prvni
         severozapadni teplarenska, a.s. and Severoceske teplarny, as,
 7.      Supervisory  Board's  report on the  result  of a  control  of the work
         related to the merger,
 8.      Decision on the merger of Prvni  severozapadni  teplarenska,  a.s.  and
         Severoceske  teplarny,  a.s. in accordance  with the merger  project of
         both companies,
 9.      Decision on changes in the Articles of Association,
10.      Election of members of the Board of Directors,
11.      Recall and election of Supervisory Board members elected by the General
         Meeting.

The first item on the  agenda  was an  approval  of the Rules of  Procedure  and
Voting at the General  Meeting  that is  enclosed  hereto as  Attachment  1. The
shareholders  received this document upon signing the  shareholders'  attendance
list.

Then the  Extraordinary  General  Meeting  voted on the Rules of  Procedure  and
Voting,  using the voting slip marked as the 1st voting  block After the voting,
Ing. Pallay said that the Rules of Procedure and Voting were approved  according
to the written statement of the vote counters.

Shareholders  having  968,297  shares,  i.e. 100 % shares present at the General
Meeting  supported the motion,  no  shareholder,  i.e. 0% shares  present at the
General Meeting,  voted against the motion,  0 share,  i.e. 0% shares present at
the General Meeting, abstained from voting,

The General  Meeting  approved  the Rules of  Procedure  and Voting  enclosed as
Attachment 1 hereto

2. The second  item on the agenda was an  election o the  Extraordinary  General
Meeting's  bodies.  Ing. Stefan Pallay submitted the following  proposals for an
election of the General Meeting's bodies:  The nominee for the General Meeting's
Chairman was Ing. Lubos Jarolimek,  the nominee for the General Meeting's Deputy
Chairman  was Ing.  Stefan  Pallay,  the  nominees  for minutes  clerks were Ms.
Nadezda  Ruzkova and Ing.  Jaroslav  Prusa,  the nominees for vote counters were
Ing.  Milan Ficek and Ing.  Antonin  Chladek,  the nominees for verifiers of the
minutes were Ing. Ales Novak and Ing. Frantisek Pracny.4

Then the General Meeting took the vote on the submitted motions using the voting
slip marked as the 2nd voting block

After the  voting,  Ing.  Pallay said that  according  to the report of the vote
counters,  Ing.Lubos  Jarolimek  had been  elected  the  Chairman of the General
Meeting.  Shareholders  having 968,297  shares,  i.e. 100% shares present at the
General Meeting,  supported him as a nominee.  No  shareholders,  i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, i.e.
0% shares present at the General Meeting, did not vote

Ing.  Stefan  Pallay was  elected the Deputy  Chairman  of the General  Meeting.
Shareholders  having  968,297  shares,  i.e. 100% shares  present at the General
Meeting, supported him as a nominee. No shareholders,  i.e. 0% shares present at
the General Meeting, voted against this motion, no shareholders,  i.e. 0% shares
present at the General Meeting,  abstained from voting, 0 shares, i.e. 0% shares
present at the General Meeting, did not vote






                                     Page 3

Mrs.  Nadezda  Ruzkova and Ing.  Jaroslav Prusa a were elected minutes clerks of
the Extraordinary General Meeting. Shareholders having 968,297 shares, i.e. 100%
shares  present  at  the  General  Meeting,   supported  them  as  nominees.  No
shareholders,  i.e. 0% shares present at the General Meeting, voted against this
motion,  no  shareholders,  i.e.  0%  shares  present  at the  General  Meeting,
abstained from voting, 0 shares,  i.e. 0% shares present at the General Meeting,
did not vote.

Ing.  Milan Ficek and Ing.  Antonin  Chladek were  elected vote  counters of the
General Meeting. Shareholders having 968,297 shares, i.e. 100% shares present at
the General Meeting, supported them as nominees. No shareholders, i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, i.e.
0% shares present at the General Meeting, did not vote.

Ing. Alesg Novak and Ing Frantisek Pracny were elected  verifiers of the General
Meeting minutes. Shareholders having 968,297 shares, i.e. 100% shares present at
the General  Meeting,  supported  them as nominees.  No  shareholders,  i. e. 0%
shares  present  at  the  General  Meeting,   voted  against  this  motion,   no
shareholders,  i.e. 0% shares  present at the General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote.

3. Ing.  Lubos  Jarolimek,  the elected  Chairman of the  Extraordinary  General
Meeting, started to conduct the deliberations of the General Meeting. He thanked
for the vote of confidence and invited Ing.  Stefan Pallay,  the Deputy Chairman
of the  General  Meeting,  to  present  the  Board of  Directors'  report on the
extraordinary  financial statements as to 30 June 1998, i.e. for the period of 1
January 1998 to 30 June 1998, including the auditor's report.

Ing. Pallay stated among others that the extraordinary  financial statements had
been prepared  pursuant to Section 69a Subsection 7 of the  Commercial  Code and
they had to give a true and fair view of the assets and  liabilities,  financial
position and economic results as to 3OJune 1998

The  auditor  of  MK  Audit,   v.o.s.,   issued  his  statement   regarding  the
extraordinary financial statements "without reservation " on 29 July 1998

The Board of Directors' report recommended the Extraordinary  General Meeting to
approve the extraordinary financial statements as of 30 June 1998.

4. After Ing. Pallay had presented the report, the Chairman of the Extraordinary
General  Meeting asked Ing.  Frantisek  Pracny,  the Chairman of the Supervisory
Board,  to  present  the   Supervisory   Board's  report  on  a  review  of  the
extraordinary  financial  statements  as of 30  June  1998.  According  to  Ing.
Pracny's  report,  the Supervisory  Board reviewed the  extraordinary  financial
statements  for the period of 1 January 1998 to 30 June 1998 and was  acquainted
with the auditor's  statement  "without  reservation  ". He also stated that the
audited  extraordinary  financial statements as of 30 June 1998, i.e. accounting
records and evidence,  were kept in a supportable way and in accordance with the
relevant  laws  and  generally  binding   regulations.   The  Supervisory  Board
recommended  the  Extraordinary  General  Meeting to approve  the  extraordinary
financial statements as of 30 June 1998.

5. The fifth item on the agenda was an  approval  of the  audited  extraordinary
financial statements. The Extraordinary General Meeting voted on this item using
the voting slip marked as the 3rd voting block.

After the voting,  Ing.  Stefan Pallay stated that the  extraordinary  financial
statements  of the Company  were  approved  according  to the report of the vote
counters, as shareholders having 968,297 shares, i.e. 100% shares present at the
General  Meeting,   supported  the  extraordinary   financial   statements.   No
shareholder,  i.e. 0% shares present at the General Meeting,  voted against this
motion, no shareholder, i.e. 0% shares present at the General Meeting, abstained
from voting, 0 shares,  i.e. 0% shares present at the General  Meeting,  did not
vote.

6. The  sixth  item on the  agenda  was the  Board of  Directors'  report on the
project of the merger of Prvni severozapadni teplarenska,  a.s., and Severoceske
teplarny,  a.s. The report was  presented by Ing.  Stefan  Pallay who said among
others that the merger project contains a number of fundamental and crucial data
regarding the  participating  companies'  identification  (business name,  legal
form,  registered office,  Company  Identification  Number,  registered capital,
number of shares), as well as a






                                     Page 4

valuation of the property and liabilities of the Company (property value,  value
of liabilities, net trade capital) and other substantial data, in particular:

a)       Determination of the exchange rate, value of shares and exchange ratio:
         the exchange  ratio of the value of the successor  company share to the
         value of the share of the company to be wound-up, while the rounded-off
         ratio of the values equals 1:0,8. Thus, the shareholders of Severoceske
         teplarny,  a.s., will become shareholders of the legal successor,  i.e.
         Prvni  severozapadni  teplarenska,  a.s.,  and they all  receive  eight
         shares of Prvni  severozapadni  teplarenska,  a.s.,  having the nominal
         value of 100 CZK for each share of Severoceske  teplarny,  a.s., having
         the nominal value of 1,000 CZK,  without undue delay after  Severoceske
         teplarny,  a.s., the wound-up  company,  is deleted from the Commercial
         Register.

b)       The value of the net  trade  capital  of  Severoceske  teplarny,  a.s.,
         falling to shares of Severoceske  teplarny,  a.s., which are subject to
         the share  exchange,  amounts  to  1,834,993,000  CZK  according  to an
         expert's opinion, while the shareholders of Severoceske teplarny, a.s.,
         receive shares of Prvni severozapadni teplarenska,  a.s., the successor
         company, having the total nominal value of 906,623,200 CZK.

c)       The equity of  Severoceske  teplarny,  a.s.,  is  transferred  to Prvni
         severozapadni  teplarenskai,  a.s.,  with  which this  company  will be
         merged.

d)       The registered capital of Prvni severozapadni teplarenska,  a.s., which
         amounted to 1,006,309,  000 CZK before the merger, will be increased by
         906,623,200 CZK due to the merger.  The registered  capital will amount
         to 1,912,932,200 CZK after the merger.

e)       The registered capital of Prvni severozapadni  teplarenska,  a.s., will
         be divided into  1,006,309  shares,  having the nominal  value of 1,000
         CZK, after the merger. Each share having the nominal value of 1,000 CZK
         will be  connected  with ten votes and each share  having  the  nominal
         value of 100 CZK will be connected with one vote.

f)       Reserves  created  by the  dissolved  company  shall not be  charged in
         revenues,  but they  shall  be  posted  in the  value  recorded  in the
         accounting as to the date of the  winding-up  in the  accounting of the
         successor company.

g)       The company to be dissolved shall be wound-up by the General  Meeting's
         decision as to the date of the General Meeting.  31 December 1998 shall
         be  proposed  as the day of  recording  the  merger  in the  Commercial
         Register.  Unless  the  merger  is  recorded  as to that  day,  another
         possible day of recording  the merger shall be the last calendar day of
         each  following  month.  The  day  of  recording  the  changes  in  the
         Commercial Register shall be the merger day.

h)       The number of the Board of Directors'  members in the successor company
         shall increase to ten members,  this provision  shall be in effect from
         the merger day. The number of the  Supervisory  Board's  members in the
         successor company shall increase to five members;  this provision shall
         be in effect from the merger day.

Further  he said among  others  that the  project  of the merger of  Severoceske
teplary,  a.s., and Prvni  severozapadni  teplarenska,  a.s., had been published
together  with the draft  resolution  of the  Extraordinary  General  Meeting in
Hospodarske  noviny  and  Mlada  fronta  Dnes on 26  August  1998.  It was  also
published in the Commercial Bulletin on the same day.

Finally,  Ing.  Stefan  Pallay  said  that  the  Board  of  Directors  of  Prvni
severozapadni teplarenska a.s., recommended to the Extraordinary General Meeting
on the basis of the submitted  merger project  (Attachment No. 2 hereof) and the
draft resolution of the Extraordinary  General Meeting, to approve the merger of
Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,  a.s., in the
extent  and under the  conditions  set in the  merger  project  and in the draft
resolution of the Extraordinary  General Meeting  concerning the merger of these
stock corporations (Attachment No. 3 here of).

7. The Chairman of the Extraordinary General Meeting asked Ing. Frantisek Pracny
to present  the  Supervisory  Board's  report on the results of a control of the
work related to the merger of the companies.  Ing.  Frantisek Pracny stated that
the Ordinary  General  Meeting held on 24 June 1998 had ordered the  Supervisory
Board to control the work  related to the merger of the  companies on an ongoing
basis within its task to review the Board of Directors' competency  performance.
It was to present its results to the General  Meeting that should  decide on the
merger of both companies.  The Supervisory  Board discussed the published merger
project and opinions of independent experts on






                                     Page 5

whose basis the project had been prepared. The Supervisory Board stated that the
expert's  opinions had been prepared by qualified  and duly licensed  experts in
compliance with the valid legal rules.

The Supervisory Board  recommended the Extraordinary  General Meeting to approve
the merger of Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,
a.s.

8.  Then  the  Extraordinary  General  Meeting  voted  on the  merger  of  Prvni
severozapadni  teplarenska a.s., and Severoceske  teplarny,  a.s., in accordance
with the  merger  project  and the draft  resolution  presented  by the Board of
Directors.

It voted using the voting slip marked as the 4th voting block.

After the voting, the Chairman of the Extraordinary  General Meeting stated that
the draft resolution of the  Extraordinary  General Meeting regarding the merger
of Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,  a.s., had
been  approved as proposed by the Board of Directors  according to the report of
the vote counters,  because shareholders having 968,297 shares, i.e. 100% shares
present at the General Meeting,  supported this motion. No shareholder,  i.e. 0%
shares  present  at  the  General  Meeting,   voted  against  this  motion,   no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote.

9. The Chairman of the Extraordinary General Meeting presented item No. 9, which
is an approval of changes in the Articles of Association of the Company. He said
that the  shareholders  had  received  the  comprehensive  draft  changes in the
Articles of Association in writing and the present  Articles of Association upon
signing the  attendance  list. On these grounds the draft changes were not read.
The Extraordinary  General Meeting voted on the changes that are attached hereto
as Attachment No. 4. It used the voting slip marked as the voting block..

After the voting, the Chairman of the Extraordinary  General Meeting stated that
the changes in the Articles of  Association  had been approved  according to the
report of the vote counters as shareholders  having 968,297  shares,  i. e. 100%
shares present at the General  Meeting,  supported this motion.  No shareholder,
i.e. 0% shares  present at the General  Meeting,  voted against this motion,  no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote

10.  The tenth item on the agenda  was an  election  of the Board of  Directors'
members.  The Chairman of the Extraordinary  General Meeting said that the Board
of Directors held on 30 July 1998 had discussed Ing. J Vladimir Prerad's written
request as of 26 June 1998 regarding his resignation from the Board of Directors
of Prvni severozapadni  teplarenska a.s. The Board of Directors decided that the
office performance.  of Ing. Vladimir Prerad would terminate on the day on which
his  resignation  would be discussed by the Board of Directors,  i.e. on 30 July
1998.  The Board of Directors  appointed no substitute  member.  It proposed the
Extraordinary General Meeting to elect Mr. Ronald James Tanski, born on 5 August
1952, residing at 99 Deerhurst Park Boulevard, Kenmore, New York 14217, the USA,
as the  eighth  Board  member.  Mr.  Tanski  was  asked  if he  agreed  with his
candidacy, and he agreed.

Then the Chairman of the Extraordinary General Meeting said that other two Board
members  had to be  elected  with  regard  to an  increased  number  of Board of
Directors' members (10 members) in the successor company. The Board of Directors
proposed the following  members with a deferred  effect,  i.e. as per the day on
which the  decision of the  Commercial  Court  regarding  changes in the company
record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register):

a)       Mr. Josef Vanzura, personal identification number: 430608/102, residing
         at Vysoka Pec, Pysna 4, Chomutov county,

b)       Ing.Emil Volkmann, personal identification number 360822/056,  residing
         at SNP 1863, Louny.

These two nominees  were asked if they agreed with their  candidacy to the Board
of  Directors.   Both  of  them  answered  that  they  agreed.   Afterwards  the
Extraordinary  General Meeting  started voting on the submitted  proposals using
the voting  slip  marked as the 6th voting  block;  where in the first  question
there was the name Ronald James  Tanski,  in the second  question  there was the
name of Josef Vanzura and at the third  question there was the name of lng. Emil
Volkmann






                                     Page 6

After the voting, the Chairman of the Extraordinary  General Meeting stated that
all the nominees were elected. Each of them was supported by shareholders having
968,297 shares, i.e. 100% shares present at the General Meeting. No shareholder,
i.e. 0% shares  present at the General  Meeting,  voted against this motion;  no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote

He also said that except for Mr. Ronald James  Tanski,  the other members of the
Board of Directors,  i.e. Mr. Josef Vanzura and Ing. Emil Volkmann, were elected
members of the Board of Directors with a deferred effect, i.e. as per the day on
which the  decision of the  Commercial  Court  regarding  changes in the company
record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register).

11.  The  eleventh  item on the  agenda  was a  recall  and an  election  of the
Supervisory Board's members elected by the General Meeting.

The Board of  Directors  proposed  the General  Meeting to recall Mr.  Stanislav
Kolar, born on 9 April 1963, residing at Vodickova 25, Prague 1, with a deferred
effect,  i.e.  as per the day on which  the  decision  of the  Commercial  Court
regarding  changes  in  the  company  record  (related  to  the  merger)  in the
Commercial Register would take effect.

Then the  General  Meeting  voted using the voting slip marked as the 7th voting
block

After the voting,  the Chairman of the General  Meeting  informed the  attending
shareholders that Mr. Stanislav Kolar was recalled from the Supervisory Board as
to the day on which the decision of the Commercial  Court  regarding  changes in
the company record (related to the merger) in the Commercial Register would take
effect.  His recall was supported by shareholders  having 968,297  shares,  i.e.
100% shares  present at the General  Meeting.  No  shareholders,  i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, L e.
0% shares present at the General Meeting, did not vote.

12. The next item on the  agenda  was an  election  of the  Supervisory  Board's
members. The Chairman of the Extraordinary  General Meeting said that the number
of the Supervisory Board's members was increased to five members due to a change
in the Articles of Association. Three members had to be still elected, while one
of them should be elected by  employees  of the Company  pursuant to Section 200
Subsection  1 of the  Commercial  Code and Article 39 para 5 of the  Articles of
Association  after the decision of the Commercial Court regarding changes in the
company  record  (related to the merger) in the  Commercial  Register  will take
effect.

The Board of Directors  proposed the Extraordinary  General Meeting to elect two
nominees for the Supervisory Board's members with a deferred effect, i.e. as per
the day on which the decision of the Commercial  Court regarding  changes in the
company  record  (related to the merger) in the  Commercial  Register would take
effect  (deletion of the wound-up  company and entry of changes in the successor
company in the Commercial Register).

These nominees were:

Jaroslav Kubera personal  identification number:  470216/020,  residing at Petra
Bezruce 2656/17, Teplice, Jarmila Folprechtova,  personal identification number:
475901/120, residing at Letna 222, Mimon IV.

Both nominees were asked if they agreed with their candidacy. Since they agreed,
the  Extraordinary  General  Meeting  started  voting on this motion,  using the
voting slip marked as the 8th voting block,  where in the first  question  there
was the name of Jaroslav  Kubera and in the other question there was the name of
Jarmila  Folprechtova.  After the voting,  the  Chairman of the General  Meeting
informed the attending  shareholders  that both nominees were elected members of
the Supendsory Board. Each of them was supported by shareholders  having 968,297
shares, i.e. 100% shares present at the General Meeting.  No shareholders,  i.e.
0% shares  present  at the  General  Meeting,  voted  against  this  motion,  no
shareholders,  i.e. 0% shares  present at the General  Meeting,  abstained  from
voting, 0 shares,  i.e. 0% shares present at the General Meeting,  did not vote.
At the same time,  the  Extraordinary  General  Meeting  decided  that these two
nominees were elected with a deferred  effect,  i.e. as per the day on which the
decision of the Commercial Court regarding changes in the company






                                     Page 7

record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register).

13. Thefollowing attachments are integral parts of this notarial record:
Attachment No. 1: Rules of Procedure and Voting of the General Meeting,
Attachment No. 2: Project of the merger of Severoceske teplarny, a.s.,
and Prvni severozapadni teplarenska, a.s., prepared pursuant to Section 69a
Subsection 3 of the Commercial Code,
Attachment No. 3: Draft resolution of the Extraordinary General Meeting,
presented by the Board of Directors and regarding the merger of Severoceske
teplarny, a.s., and Prvni severozapadni teplarenska, a.s.,
Attachment No. 4: Draft of changes in the Articles of Association,
Attachment No. 5: Expert's opinion No. 1542/1998 of the expert's ledger, as of
17 August 1998:
"Expert's Report pursuant to Section 69a Subsection 4 of the Commercial Code on
a Project of a Merger of Two Companies",
Attachment No. 6.- Expert's opinion No. 40/1998, as of 18 August 1998:
"Expert's  Report  pursuant to Section 69a Subsections 4 and 5 of the Commercial
Code on the Results of a Review of the Merger Project".

Since all the items on the agenda were  discussed,  the  Chairman of the General
Meeting finished the Extraordinary General Meeting at 11:20 am

I, the notary, wrote out this notarial record and signed it in my own hand.

         L.S.

                                                           Jaroslava Mala

                                   notary, in her own hand





EX-99
7
0007.txt
NOTARIAL RECORD FROM SEVEROCESKE TEPLARNY, A.S.


JUDr. Jaroslava Mala, notary seated in Most, Moskevska 1/14
- -----------------------------------------------------------
Page one
                                                               NZ 358/98
                                                                N 362/98








                                   Counterpart


Notarial Record


written by me, JUDr.  Jaroslava Mala, notary public seated in Most, in my office
at Moskevska 1/14 in Most,  September 28, 1998 (this  twenty-eight  of September
nineteen hundred and eighty nine).


At  the  request  of  the   representatives  of  Severoceske   teplarny,   stock
corporation,  seated  in  Most,  J.  Seiferta  2179,  I have  come  today to the
Company's registered office where an extraordinary general meeting of this stock
corporation was held,

I make the following

                                   attestation

regarding the course of deliberations of the Extraordinary General Meeting.

First:  The  deliberations  of the  Extraordinary  Meeting  were opened by Josef
Vanzura,  the Managing  Director and  Vice-Chairman of the Board of Directors at
2.15 p.m. In the beginning he  introduced  the members of the Board of Directors
and of the Supervisory Board of the stock corporation  attending the meeting. He
stated that the  Extraordinary  General  Meeting was convened in compliance with
the Commercial  Code and under the observance of other legal  requirements.  The
announcement of the  Extraordinary  General Meeting was published in Hospodarske
noviny and in  Commercial  Bulletin,  on September 21, 1998. As of this date the
excerpt of shareholders was executed and at the same time the Securities  Center
stopped  the  registration  of  trades  with  shares  until  the  date  when the
Extraordinary General Meeting was held.

Next,  he stated that the  Extraordinary  General  Meeting  was  attended by the
shareholders  having in total  89.7 per cent of shares  (seven  natural  persons
having shares of the total number of one thousand six hundred  forty-two  pieces
and eight legal  entities with the total number of 1,014,517  pieces of shares).
The Extraordinary General Meeting constituted a quorum.






Page two



Then Mr.  Vanzura  informed the  shareholders  attending  the meeting  about the
General Meeting's agenda:

 1.      Opening and control if the General Meeting constitutes a quorum,

 2.      Approval of the Rules of Procedure and Voting of the General Meeting,

 3.      Election of Chairman of the General Meeting, minute clerk, verifiers of
         the minutes and vote tellers,

 4.      Election of the member of the Board of directors,

 5.      Board of Directors'  report on the extraordinary  financial  statements
         prepared as of June, 30, 1998,

 6       Supervisory  Board's  report on the  examination  of the  extraordinary
         financial statements verified by the auditor,

 7.      Approval  of the  extraordinary  financial  statements  verified by the
         auditor,

 8.      Board of Directors'  report on the merger project  between  Severoceske
         teplarny, a.s. and Prvni severozapadni teplarenska, a.s.,

 9.      Supervisory  Board's report on the control results of the work progress
         in merging,

 10.     Resolution on the merger between Severoceske  teplarny,  a.s. and Prvni
         severozapadni  teplarenska  a.s., in compliance with the merger project
         of both companies,

 11.     Approval of the bonuses for the members of the Company's bodies,

 12.     Conclusion of the General Meeting.


Secondly:  The second item on the Agenda of the General Meeting was the approval
of the Rules of Procedure  and Voting of the General  Meeting and  therefore Mr.
Vanzura invited Ing.  Richtr to present the  information  about this document to
the General  Meeting.  Mr. Richtr stated that all  shareholders had received the
text of the Rules of  Procedure  and Voting  enclosed as Annex 1 of the Notarial
Record upon signing the attendance list. He-raised the question if everybody had
one copy available. Due to the fact that the reply was positive, the text of the
Rules      of       Procedure       and       Voting      was      not      read
again.

After voting results having been submitted in writing by the vote tellers,  Ing.
Richtr stated that the Rules of Procedure and Voting of the General Meeting were
approved.  Shareholders having 99.1457% of shares supported the motion,  0.8130%
shares voted against the motion and 0.0413 shares abstained from voting.

The General  Meeting  approved the Rules of Procedure  and Voting of the General
Meeting.

Then Ing. Jaroslav Richtr invited Mr. Josef Vanzura,  Managing Director, to take
the floor again.

Thirdly:  Mr. Josef Vanzura informed the General Meeting about the third item on
the Agenda that was the election of the General Meeting's  bodies.  The Board of
Directors  submitted  the  following  proposal  for an  election  of the General
Meetings  bodies:  The  nominee  for the  General  Meeting's  Chairman  was Ing.
Jaroslav  Richtr,  the nominee for minute clerk was Ing.  Hana  Tvrznikova,  the
nominees for verifiers of the





Page three



minutes were JUDr Vladimir  Janovsky and Alexandr Krista,  the nominees for vote
counters were Ms. Marie Zakova, Mr. Jaroslav Baxa and Ing. Vladislav Sliska. Due
to the fact that nobody  raised any  counter-offer,  the voting was performed by
acclamation.

After the written  results  about the voting  having been  submitted by the vote
tellers,  Ing.  Richtr  stated that the General  Meeting's  bodies were elected.
Shareholders having 9.9597% of shares supported the motion, no shareholder, i.e.
0.00% of shares  voted  against the  motion,  0.0403% of shares  abstained  from
voting.

The General Meeting elected the bodies of the General Meeting as follows:
Ing. Jaroslav Richtr, Chairman of the Extraordinary General Meeting
Minute clerk: Ing. Hana Tvrznikova
Verifiers of the minutes: JUDr Vladimir Janovsky, Mr. Alexandr Krista
Vote counters: Mr. Jaroslav Baxa, Ms. Marie Zakova and Ing. Vladislav Sliska
Afterwards Mr. Josef Vanzura, Managing director, took the floor.

Fourthly:  Ing.  Jaroslav  Richtr  started to conduct the  deliberations  of the
General  Meeting.  He  informed  the  shareholders  about the fourth item on the
Agenda that was the election of the member of the Board of Directors.  The Board
of Directors proposed Mr. Ales Novak,  identification No. 560814/0923,  residing
at U.S.A., 2905 SW Greenway Ave, Portland, Oregon 97201, for the nomination as a
member of the Board of  Directors.  Ing.  Richtr raised a question if anybody of
the shareholders attending the meeting had any comments.  Then he asked Mr. Ales
Novak if he agreed  with his  nomination.  He agreed  and  therefore  voting was
performed using the voting slips.

After the vote  counters'  written  notice about the voting  results having been
submitted,  Ing.  Richtr  stated that due to the fact that several  shareholders
used  voting slip No. 2, some of them used No. 3 and even  somebody  used voting
slip No. 4, the previous voting was cancelled  because the counting of votes had
not been stared yet.

A new voting will be performed  while the  shareholders  use now the voting slip
No. 5. After the written  notice of vote tellers about the voting,  Ing.  Richtr
stated,  that  Mr.  Ales  Novak  became  a member  of the  Board  of  Directors.
Shareholders having 99.1457% of shares supported the motion,  0.7901 % of shares
voted against the motion and 0.0572% of shares abstained from voting.

The  General  Meeting  approved  Ing.  Ales  Novak as a member  of the  Board of
Directors of Severoceske teplarny, a.s.

Fifthly:  Ing.  Jaroslav Richtr informed the General Meeting about the next item
on the agenda - i.e. the Board of Directors  report on  extraordinary  financial
statements prepared as of June 30, 1998.

Mr.  Josef  Vanzura,  Managing  Director,  was invited to present the  mentioned
report.

The  General  Meeting   acknowledged  the  Board  of  Directors  report  on  the
extraordinary financial statements prepared as of June 30, 1998.






Page four



Sixthly: The sixth item on the agenda of the General Meeting was the Supervisory
Board's report on the extraordinary financial statements.  Therefore Ing. Richtr
invited Ing. J.  Nechvatal,  Chairman of the  Supervisory  Board, to present the
report

The  General  Meeting  acknowledged  the  Board  of  Directors'  report  on  the
examination of the extraordinary  financial  statements  prepared as of June 30,
1998.

Seventhly:  The  seventh  item on the  agenda  of the  General  meeting  was the
approval of the extraordinary  financial statements verified by the auditor. The
shareholders voted using voting slip No. 6

After the voting Ing. Richtr announced  15-minute break, i.e. until 2.50 p.m. In
the course of the break counting of votes was performed.

After  15-minute  break Ing.  Richtr  continued.  He announced that based on the
written notice of the vote tellers, the extraordinary  financial statements were
approved.  Shareholders having 98.8090% of shares supported the motion,  1.1751%
of shares voted against the motion and 0.0158% of shares abstained.

The General Meeting approved the extraordinary  financial statements prepared as
of June 30,1998 verified by the auditor.

Eighthly:  Ing. Richtr stated that meanwhile the protest supra the  cancellation
of voting on item No. 4 was raised  Ing.  Richtr  gave the  explanation  to this
matter  and  stated  that  due to the  fact  that  voting  about  item No. 3 was
performed  through  the  acclamation,  voting  slip No. 3 should have been used.
Unfortunately, the commission found out that different slips were thrown into to
the box. Thus he gave the explanation regarding the protest above mentioned. The
protest was enclosed as Annex No. 6

The General  Meeting  acknowledged  the report on the results of  on-going-basis
follow-up of the work progress of merging carried out by the  Supervisory  Board
of  Severoceske  teplarny,  a.s.  on the  basis of the  resolution  taken by the
Ordinary General Meeting held June 25, 1998.

Then the eighth item on the agenda of the General Meeting was proceeded.  It was
the  Board  of  Directors'  report  on  the  merging  project  presented  by Mr.
Jarolimek,  Chairman  of the Board of  Directors.  He stated,  that the  General
Meeting  held in June of this  year,  apart  from the other  things,  ordered to
prepare the project on merging, a project in compliance with the SCT Articles of
Association  as well as with the law.  Therefore the Board of Directors  submits
this  project for the General  Meeting's  approval.  The copy of the project was
available to each  shareholder.  Then all the shareholders  were asked if all of
them were acquainted  with it. Ing.  Jaroslav Richtr took the floor. He informed
about the fact that two protests  regarding item No. 8 were raised. The protests
were enclosed as Annexes No. 7 and 8.

Ninthly: The ninth item on the agenda of the General Meeting was the Supervisory
Board's report  regarding the follow-up of the work progress in merging that was
presented by Ing. Nechvatal.






Page five


The General Meeting acknowledged the Supervisory Board's report on the following
up of the work progress of the merger.

Tenthly:  The tenth item on the agenda of the General Meeting was the resolution
on merging Severoceske teplarny, a.s. with Prvni severozapadni  teplarenska a.s.
in compliance with the merger project  between these two companies.  This report
was presented by Ing.  Richtr.  He informed the General  Meeting about the draft
resolution as published in Hospodarske noviny on August 26, 1998:

"1.      The Extraordinary General Meeting states that:
a)       in  compliance  with all legal  requirements  stated under  section 69a
         subsection 3 of the  Commercial  Code, the project on the merge between
         Severoceske teplarny, a.s. and Prvni severozapadni teplarenska a.s. was
         developed,  while the evaluation of the assets and  liabilities of both
         companies  participating  in merging is supported by expert's  opinions
         prepared by two experts for each participating company. Thee project on
         merging is enclosed to the Minutes of the General Meeting,

b)       the merger project was examined by two, on Severoceske  teplarny,  a.s.
         independent  experts,  that  pursuant to  provisions  under section 69a
         subsections  4 and 5 of  the  Commercial  Code,  prepared  the  written
         reports for the shareholders.  The reports reviewing the merger project
         are enclosed to the minutes of this General Meeting,

c)       in the  registered  seat of the Company  during all working days in the
         period  from  10:00 to 14:00  until the moment  when the  Extraordinary
         General Meeting was started,  each shareholder of Severoceske teplarny,
         a.s.  had the chance to go through  principal  materials of the merger,
         i.e. the project on merging, experts' report, as well as other document
         stated  under  the  provision  of  section  69a,  subsection  7 of  the
         Commercial Code in the given extent and specified  details,  manner and
         in the time stated thereof,

d)       the  draft   resolution  of  the   Extraordinary   General  Meeting  of
         Severoceske  teplarny,   a.s.  was  published  in  Commercial  Bulletin
         pursuant  to  section  220a,  subsection  9,  and  section  769  of the
         Commercial  Code and pursuant to Article  14.4.6 of the Articles of the
         Association  of  Severoceske  teplarny,  a.s.  it was  made  public  in
         Hospodarske noviny,

e)       pursuant to section  220a,  subsection 9 of the  Commercial  Code,  the
         draft  resolution  was  sent  to all  known  creditors  of  Severoceske
         teplarny, a.s.

2.       acknowledges,
a)       the report of  Severoceske  teplarny  Board of  Directors on the merger
         project,

b)       the report on the results of the  follow-up on an ongoing basis related
         to the work progress in merging that was carried out by the Supervisory
         Board of  Severoceske  teplarny,  a.s.  on the basis of the  resolution
         taken by the Ordinary General Meeting held June 25, 1998.

3.       approves
         the merger project in the version published in Commercial  Bulletin and
         in Hospodarske noviny,






Page six



4.       decides
         in compliance  with the  provision  under  section 69,  subsection  32,
         section 187 letter i) of the  Commercial  Code and  pursuant to Article
         7.1.  letter  k) of the  Articles  of the  Association  of  Severoceske
         teplarny, a.s. about the merger between the company of


Severoceske teplarny,  a.s. and the company of Prvni severozapadni  teplarenska,
a.s. under conditions and terms stated in an approved project on merging, that:

         a) the company of Severoceske teplarny,  a.s. shall be wound-up without
         liquidation  as  of  September  28,  1998  and  the  company  of  Prvni
         severozapadni teplarenska, as. shall become its legal successor,

         b)  the  shareholders  of  Severoceske  teplarny,   a.s.  shall  become
         shareholders  of the  legal  successor,  i.e.  of  Prvni  severozapadni
         teplarenska  a.s. and each one share of Severoceske  teplarny,  a.s. of
         the nominal value of CZK 1, 000 (in words:  one thousand  Czech crowns)
         will be  exchanged  for 8  pieces  of  shares  of  Prvni  severozapadni
         teplarenska,  a.s. of the nominal value CZK 100 (in words:  one hundred
         Czech  crowns)  without  undue delay after the deletion of the wound-up
         company of Severoceske teplarny, a.s. from the Commercial Register,

         c) the  value  of net  assets  (shareholders'  equity)  of  Severoceske
         teplarny,  a.s.,  falling to the shares of Severoceske  teplarny,  a.s.
         that  are a  subject-matter  of  the  exchange  of  shares,  represents
         according to expert's opinion CZK 1,834,993, 000 (in words: one billion
         eight hundred  thirty-four million nine hundred  ninety-three  thousand
         Czech  crowns)  while  the  shareholders  of the  company  dissolved  -
         Severoceske  teplarny,  a.s. - will receive the shares of the successor
         company of Prvni severozapadni  teplarenska,  a.s. of the total nominal
         value of CZK  906,623,200  (in words:  nine hundred and six million six
         hundred and twenty-three thousand two hundred Czech crowns).

         d) the assets of the company of Severoceske  teplarny,  a.s. shall pass
         to the Company of Prvni severozapadni teplarenska, a.s. with which this
         company is merging,

5.       orders
a)       the Board of Directors of Severoceske teplarny,  a.s., to submit in the
         coordination  with  the  Board  of  Directors  of  Prvni  severozapadni
         teplarenska,  a.s.,  the  petition  for  the  deletion  of  Severoceske
         teplarny a.s.,  the company to be merged,  as of December 31, 1998 from
         the Commercial Register. Provided the Regional Court in Usti nad Labem,
         due to any reason, shall not issue the resolution on the deletion as of
         this date,  the petition  includes the request for deleting the company
         as of the last date of any following  calendar  month but always on the
         same date when the  changes on Prvni  severozapadni  teplarenska  a.s.,
         with which the company is merging,  will be entered into the Commercial
         Register,

         b) the Board of Directors of Severoceske  teplarny,  a.s to continue in
         the  activities  necessary  for  a  due  transfer  of  all  rights  and
         obligations  related to  Severoceske  teplarny,  a.s. to the  successor
         company - Prvni severozapadni teplarenska, a.s,






Page seven

c)       the  Supervisory  Board of  Severoceske  teplarny,  a.s. to oversee the
         exercise of the powers of the Board of Directors on an ongoing basis in
         order that everything  would pass in compliance with the merger project
         and relevant  provisions of the  Commercial  Code and pursuant to other
         generally binding legal regulations."

After the draft having been read a number of comments,  proposals or  objections
was  raised  that were  enclosed  as  annexes  No. 9 - 20. In most  cases,  they
expressed  disagreement or protest against the merger, the shareholders  request
the share of net  shareholders'  equity.  Then the voting about the merger using
the voting slip No. 7 took the place.

After the  results  of voting  in  writing  having  been  submitted  by the vote
tellers,  the Chairman of the General  Meeting  announced that the resolution on
the  merger  between  Prvni  severozapadni  teplarenska,  a.s.  and  Severoceske
teplarny,  a.s. was approved.  Shareholders  having 98.6261% of shares supported
the  motion,  1.3719% of shares  voted  against the motion and 0.0020% of shares
abstained.


The General  meeting  approved the resolution on the  dissolution of Severoceske
teplarny,  a.s. and about its merger with Prvni  severozapadni  teplarenska a.s.


Eleventhly:  The  eleventh  item on the agenda of the  General  Meeting  was the
approval of bonuses for the Company's bodies.  This report was presented by Ing.
Jaroslav  Richtr.  The  bonuses  to  members  of  the  Board  of  Directors  and
Supervisory  Board were assessed in the monthly amount of CZK 60,000,  in words:
sixty  thousand  Czech  crowns  until  the date of  dissolution  of  Severoceske
teplarny,  a.s. and the Board of Directors was required to determine rules valid
for  the   payment   of   bonuses  to   individual   bodies'  of  the   company.

After the voting on voting slip no. 8 took place. After the results of voting in
writing having been  submitted by the vote tellers,  the Chairman of the General
Meeting announced that the bonuses for the members of the Board of Directors and
the  Supervisory  Board were approved.  Shareholders  having  98.7712% of shares
supported the motion, 1.0763% of shares voted against the motion and 0.1525 % of
shares abstained.


Twelfthly:  The  following  documents  were  enclosed as annexes to the Notarial
Record:

Annex No. 1 - Rules of Procedure and Voting of the General Meeting
Annex No. 2 - Project on merging Severoceske teplarny, a.s. with Prvni
              severozapadni teplarenska, a.s.
Annex No. 3 - Draft resolution of the Extraordinary General meeting of
              Severoceske teplarny, a.s.
Annex No. 4 - Expert's opinion pursuant section 69a, subsections 4 and 5 of the
              Commercial Code
Annex No. 5 - Expert's opinion pursuant section 69a, subsection 4 and 5 of the
              Commercial Code
Annex No. 6 - Protest against voting on item No. 4
Annexes No. 7,8 - Protest related to item No. 8






Page eight



Annexes No. 9 - 19 - Protests related to item No. 10
Annex No. 20 - Protest related to item No. 12

In the  conclusion  of the  General  Meeting,  Mr.  Jarolimek  had the floor and
announced to all who raised protests that individual  explanatory  letters would
be sent to them.

On the  grounds  that all items of the  General  Meeting-were  dealt  with,  Mr.
Jarolimek finished at 12.30 the deliberations.





I, the notory, wrote out this notarial record and signed it in my own hand



                                         L.S. JUDr Jaroslava Mala
                                                  notary, in her own hand






EX-99
8
0008.txt
RESOLUTION DATED DECEMBER 9, 1999


This  resolution  became  legally  effective                     F  25787/98
on  December  9, 1999                                            --------- /633
Regional Court in Usti nad                                       LabemB 239/17
December 9, 1999

Regional Court in Usti nad Labem decided in the legal matter of the proposal for
recording the changes in the stock  corporation  of Severoceske  teplarny,  a.s.
with  the  registered  office  in  Most,  Seifertova  2179,  zip  code  434  01,
identification number 46 70 80 65 into the Commercial register as follows:

In the  Commercial  Register  kept with the Regional  Court in Usti nad Labem in
Section B, Insert number 239

                                is being recorded

The stock corporation Severoceske teplarny, a.s. which was merged with the stock
corporation Prvni  severozapadni  teplarenska a.s. with the registered office in
Komorany u Mostu,  identification number 46708197, on the basis of the decisions
of  Extraordinary  General  Meetings  held on  09/28/1998,  is deleted  from the
Commercial Register as of December 31, 1999.

Legal reason of the deletion: winding-up of the Company without liquidation with
                              the legal successor

Date of recording the changes: December 31, 1999


Advice:    An appeal against this  resolution may be lodged at the High Court in
           Prague,  through  this  Court,  within the period of 15 days from the
           delivery hereof.

Usti nad Labem, December 3, 1999
                                                      JUDr. Jana Souckova, s.s.
Witness: Vera Horakova
                   Round Seal: Regional Court, Usti nad Labem





EX-99
9
0009.txt
RESOLUTION DATED JULY 17, 2000


This resolution became legally effective on
July17, 2000
District Court in Usti nad Labem
on July 17, 2000


                                      COPY
                                                             F 14252/2000
                                                             -----------/ 1068
                                                             B 242/18

                               R e s o l u t i o n

The District Court in Usti nad Labem decided in the legal matter of the proposal
of the record of the change of company  Prvni  severozapadni  teplarenska  a.s.,
registered office Komorany u Mostu,  postal code 434 03, company ID number 46 70
81 97 as follows:

In the  Commercial  Register at the  District  Court in Usti nad Labem,  file B,
insert No,. 242

the Company name:          Prvni severozapadni teplarenska a.s.
Registered office:         Komorany u Mostu, postal code 434 03

                                    is erased

the Company name:    United Energy, a.s.
Registered Office:   Most - Komorany, land-registry No.: 2, postal code 434 03

                                   is recorded

Date of change record:, September 1, 2000

Advice:  An appeal can be filed against this resolution within fifteen days from
         its delivery to the High Court in Prague, by means of this court.


In Usti nad Labem                           July 13, 2000

                                                     JUDr. Jana Souckova, s.s.
                                                              judge

Responsible for correctness:        Vera Horakova

                                   round seal
                        District Court in Usti nad Labem






Hereby I verify that this photocopy  corresponds word for word with the original
of the document,  from which it was created,  consisting of 1 sheet of paper, in
which no changes,  amendments,  inserts or strikes were done, which could weaken
its credibility. This photocopy is complete and contains 1 sheet of paper

In Most, July 18, 2000

Miroslava Pavlova
authorized by JUDr. Jaroslava Mala, notary

round seal - JUDr. Jaroslava Mala, notary in Most





EX-99
10
0010.htm
CERT. OF AMALGAMATION









 PROVINCE OF ALBERTA                )
                                    )
                                    )
                                    )
                                    )
                             TO WIT:)

I, ALYSON F. GOLDMAN, of
the City of Calgary, in the Province of Alberta, a notary public in and for the
Province of Alberta by royal authority duly appointed, do certify that the
paper writings hereto annexed are true photostatic copies of documents produced
and shown to me and purporting to be the CERTIFICATE and ARTICLES OF
AMALGAMATION and REGISTRATION STATEMENT of NATIONAL FUEL EXPLORATION CORP.
evidencing the amalgamation of NATIONAL FUEL EXPLORATION CORP. and TRI LINK
RESOURCES LTD., dated June 16, 2000; issued under the Business Corporations Act
(Alberta), the said copies having been compared by me with the said original
documents, an act whereof being requested I have granted the same under my
notarial form and seal of office to serve and avail as occasion shall or may
require. 

        IN TESTIMONY WHEREOF I have hereunto
 set my hand and affixed my notarial
 seal at the City of Calgary, this 27th day of July, 2000.




            
            
            
            
            
/s/ ALYSON F. GOLDMAN        
            


            
            
            
            
            
A Notary Public in and for the Province

            
            
            
            
            
of Alberta



            
            
            
            
            
ALYSON F. GOLDMAN

            
            
            
            
            
Barrister & Solicitor





CORPORATE ACCESS NUMBER:   208852533




Alberta

BUSINESS CORPORATIONS ACT

CERTIFICATE

OF

AMALGAMATION





NATIONAL FUEL EXPLORATION CORP.

IS THE RESULT OF AN AMALGAMATION FILED ON 2000/06/16.




REGISTRAR OF

CORPORATIONS





Articles of Amalgamation
For
NATIONAL FUEL EXPLORATION CORP.



Classes of Shares:                          THE CORPORATION IS AUTHORIZED TO ISSUE AN
                                            UNLMTED NUMBER OF COMMON SHARES
Restrictions on Share                       NO SHARES OF THE CORPORATION SHALL BE
Transfers:                                  TRANSFERRED WITHOUT THE PRIOR WRITTEN
                                            APPROVAL OF THE BOARD OF DIRECTORS

Number of Directors:
Minimum Number of
Directors:                                  1
Maximum Number of
Directors :                                 10
Restrictions on Business To:                NONE
Restrictions on Business
From:                                       NONE
Other Rules or Provisions:                  SEE SCHEDULE A




                                   Registration Authorized By: ALYSON F. GOLDMAN
                                                               SOLICITOR



 
SCHEDULE A


7.   Other rules or provisions, if any:



(a) 
The number of shareholders of the Corporation exclusive of persons who are in
its employment and exclusive of persons who, having been formerly in the
employment of the Corporation, were, while in that employment, and have
continued after termination of that employment to be, shareholders of the
Corporation, is limited to not more than fifty, two or more persons who are the
joint registered owners of one or more shares being counted as one shareholder.



(b) Any invitation to the public to subscribe for any securities
 of the Corporation shall be prohibited.



(c) 
The directors may appoint from time to time one or more directors within the
limits provided in the Business Corporations Act (Alberta).



(d) Meetings of the shareholders may be held at any place
 within Canada or the United States.



(e) 
The Corporation shall have a lien on the shares registered in the name of the
shareholder or his legal representative for a debt of that shareholder to the
Corporation.




Service Request Number:           2106629
Alberta Corporation Type:         Named Alberta Corporation
Legal Entity Name:                NATIONAL FUEL EXPLORATION CORP.
French Equivalent Name:
Nuans Report Number:
Nuans Report Date:
French Name Nuans Report
Number:
French Name Nuans Report Date:
REGISTERED ADDRESS
Street:                           1900,333 - 7 AVENUE SW
Legal Description:
City:                             CALGARY
Province:                         ALBERTA
Postal Code:                      T2P 2Zl
RECORDS ADDRESS
Street:
Legal Description:
City:
Province:
Postal Code:
ADDRESS FOR SERVICE BY
MAIL
Post Office Box:

City:
Province:
Postal Code:
Internet Mail ID:

Classes Of Shares and any
Maximum Number(within each        THE CORPORATION IS AUTHORIZED TO
CLASS):                           ISSUE AN UNLIMITED NUMBER OF COMMON
                                  SHARES

                                  NO SHARES OF THE CORPORATION SHALL
                                  BE TRANSFERRED WITHOUT THE PRIOR
Restrictions On Share Transfers:  WRITTEN APPROVAL OF THE BOARD
                                  OF DIRECTORS
Minimum Number Of Directors:      1
Maximum Number Of Directors:      10
Restrictions On Business To:      NONE
Restrictions On Business From:    NONE
Other Provisions:                 SEE SCHEDULE A
Professional Endorsement
Provided:

Directors Issue Shares In Series:
Future Dating Required:
Registration Date:                2000/06/16

Directors


Last Name:                        ACKERMAN
First Name:                       PHILIP
Middle Name:                      C.
Street / Box Number:              20 SOUTH NEADOW DRIVE
City:                             ORCHARD PARK
Province:                         NEW YORK
Postal Code:                      14127
Country:
Appointment Date:                 2000/06/16
Resident Canadian:
Named on Stat Dec:
Status:                           Active


Last Name:                        BURNS
First Name:                       GARY
Middle Name:                      W.
Street / Box Number:              BOX 719
City:                             BRAGG CREEK
Province:                         ALBERTA
Postal Code:                      TOL OKO
Country:
Appointment Date:                 2000/06/16
Resident Canadian:                Y
Named on Stat Dec:                Y
Status:                           Active


Last Name:                        GORUK
First Name:                       DENNIS
Middle Name:                      R.
Street / Box Number:              19 COACH GATE WAY SW
City:                             CALGARY
Province:                         ALBERTA
Postal Code:                      T3H 1L7
Country:
Appointment Date:                 2000/06/16
Resident Canadian:                Y
Named on Stat Dec:
Status:                           Active


Last Name:                        KENNEDY
First Name:                       BERNARD
Middle Name:                      J.
Street / Box Number:              33 RUSKIN ROAD
City:                             BUFFALO
Province:                         NEW YORK
Postal Code:                      14226
Country:
Appointment Date:                 2000/06/16
Resident Canadian:
Named on Stat Dec:
Status:                           Active




Amalgamating Corporation - Registered in Alberta

Corporate Access Number         Legal Entity Name

204196406                       TRI LINK RESOURCES LTD.
208777888                       NATIONAL FUEL EXPLORATION CORP.





Court Orders



Order Type Order Date Order Number Judicial District Termination Date






Attachments


Attachment Type                Microfilm Bar Code     Date Recorder
Other Rules or Provisions      Electronic             2000/06/16
Statutory Declaration          10000395000021664      2000/06/16

Registration Authorized By:    ALYSON F. GOLDMAN
                               SOLICITOR



   
 Other Provisions.txt
SCHEDULE A



7.   Other rules or provisions, if any:



(a) The number of
shareholders of the Corporation exclusive of persons who are in its employment
and exclusive of persons who, having been formerly in the employment of the
Corporation, were, while in that employment, and have continued after
termination of that employment to be, shareholders of the Corporation, is
limited to not more than fifty, two or more persons who are the joint-
registered owners of one or more shares being counted as one shareholder.



(b) Any invitation to the public to subscribe for any securities
 of the Corporation shall be prohibited.



(c) The directors may
appoint from time to time one or more directors within the limits provided in
the Business Corporations Act (Alberta).



(d) Meetings of the shareholders may be held at any place
 within Canada or the United States.



(e) The Corporation shall
have a lien on the shares registered in the name of the shareholder or his legal
representative for a debt of that shareholder to the Corporation.



CANADA                   )IN THE MATTER OF THE AMALGAMATION
                         )PURSUANT TO
PROVINCE OF ALBERTA      )SECTION 178(2) OF THE BUSINESS
                         )CORPORITIONS ACT (ALBERTA) OF
TO WIT:                  )NATIONAL FUEL EXPLORATION CORP.
                         )AND TRI LINK RESOURCES LTD.

                      
 STATUTORY DECLARATION

        I, GARY W. BURNS, of Bragg
 Creek, Alberta, DO SOLEMNLY DECLARE THAT:



1. I am a proposed  director  NATIONAL FUEL EXPLORATION  CORP.
 (the  "Amalgamated  Corporation"),  a corporation
proposed to be formed by the amalgamation of National Fuel Exploration Corp.
 and Tri Link Resources Ltd.



2. 
I have conducted such examination of the books and records of both amalgamating
corporations as are necessary to enable me to make the statements herein set
forth.



3. There are reasonable grounds for believing that:



     
     a.   the Amalgamated
 Corporation will be able to pay its liabilities as they become due; and>



     
     b.   the realizable value of the Amalgamated
 Corporation's
assets will not be less than the aggregate of its

     
           liabilities and
 stated capital of all classes.



4. There are reasonable grounds for believing that no creditor
 will be prejudiced by the amalgamation.



     
   AND
I MAKE this solemn declaration conscientiously believing it to be true and
knowing that it is of the same force and effect as if made under oath. 

Calgary, in the Province of Alberta, this    )
16th day of June, 2000.                      )
                                             )
/s/ ANDREA L. WHYTE                          )   /s/ GARY W. BURNS
Notary Public in and for                         GARY W. BURNS
the Province of Alberta

ANDREA L. WHYTE
Student-at-Law









EX-3
11
0011.htm
BY-LAWS









BY-LAW NO. 1

                           
a by-law relating generally

                            to the transaction of the

                             business and affairs of


                
NATIONAL FUEL EXPLORATION CORP.

                                   (the "Corporation")


1  -  INTERPRETATION




1.1    Definitions - In this
by-law and all other by-laws of the Corporation, unless the context requires
otherwise:



(a) 
“the Act” means the Business Corporations Act (Alberta), or any
statute which may be substituted therefore including the regulations made
thereunder as amended from time to time;



(b) 
“articles” means the original or restated articles of incorporation,
articles of amendment, articles of amalgamation, articles of arrangement,
articles of continuance, articles of dissolution, articles of reorganization,
articles of revival, -letters patent, supplementary letters patent, a special
Act and any or let the instrument by which the Corporation is incorporated;



(c)       "board" means the board of directors of the Corporation; and
 "director" means a member of the board;



(d)       "meeting of shareholders" means an annual meeting of
 shareholders or a special meeting of shareholders;



(e)       "non-business day" means Saturday, Sunday and any other
 day that is a holiday as defined in the Interpretation Act (Alberta);



(f) 
“person” includes an individual, sole proprietorship, partnership,
unincorporated association, unincorporated syndicate, unincorporated
organization, trust, body corporate, and a natural person in the capacity of
trustee, executor, administrator, or other legal representative;



(g)       "resident Canadian" means a Canadian citizen ordinarily
 resident in Canada or as otherwise defined in the Act;



(h) 
“unanimous shareholder agreement” means a written agreement among all
the shareholders of the Corporation, or among all such shareholders and one or
More persons who are not shareholders, or a written declaration by a person who
is the beneficial owner of all the issued shares of the Corporation, that
restricts, in whole or in part, the powers of the directors to manage or
supervise the management of the business and affairs of the Corporation, as may
be from time to time amended;



(i) 
words importing the singular number also include the plural and vice-versa; words
 importing a particular gender include all genders;



(j) 
all words used in this by-law and defined in the Act shall have the meanings
given to such words in the Act or in the related Parts thereof.



1.2    Execution in
Counterpart - Any articles, notice, resolution, requisition, statement or
other document required or permitted to be executed by more than one person for
the purposes of the Act may be executed in several documents of like form each
of which is executed by one or more of such persons, and such documents, when
duly executed by all persons required or permitted, as the case may be, to do
so, shall be deemed to constitute one document for the purposes of the Act.



2  -  GENERAL BUSINESS



2.1   Registered Office - The registered office of the Corporation
 shall be in the municipality or geographical township within Alberta as the board may from
 time to time determine.



2.2   Seal - The Corporation may have a seal which shall be adopted
 and may be changed by the board.



2.3   Financial Year -
The financial year of the Corporation shall be determined by the board from time
to time.



2.4   Execution of Instruments - Deeds, transfers, assignments, contracts,
 obligations and other instruments shall be signed on
behalf of the Corporation by two persons,



(a) one of whom holds the office of chairman of the board, president,
 managing director or vice-president or is a director, and



(b) 
the other of whom holds one of the said offices or the office of secretary,
treasurer, assistant secretary or assistant treasurer or any other office
created by by-law or by resolution of the board or is a director.



In addition, the board may from time to time direct the manner in which and the person or
 persons by whom any particular instrument
or class of instruments may or shall be signed.



The secretary or any other
officer or any director may sign certificates and similar instruments (other
than share certificates) on the Corporation’s behalf with respect to any
factual matters relating to the Corporation’s business and affairs,
including certificates verifying copies of the articles, by-laws, resolutions
and minutes of meetings of the Corporation.



2.5   Banking Arrangements -
The banking business of the Corporation, or any part thereof, shall be
transacted with such bank, trust company or other firm or body corporate as the
board may designate, appoint or authorize from time to time and all such banking
business, or any part thereof, shall be transacted on the Corporation’s
behalf by such one or more officers or other persons as the board may designate,
direct or authorize from time to time and to the extent thereby provided.



3 - BORROWING



3.1   Borrowing - Without limit to the powers of the board as
 provided in the Act, the board may from time to time on behalf of
the Corporation:



(a) borrow money upon the credit of the Corporation;



(b) issue, reissue, sell or pledge debt obligations of the Corporation;




(c) to the extent permitted by the Act, give, directly or indirectly,
 financial  assistance to any person by means of a loan, a
guarantee or otherwise to secure the performance of an obligation; and



(d) 
mortgage, hypothecate, pledge or otherwise create a security interest in all or
any property of the Corporation, owned or subsequently acquired, to secure any
obligation of a Corporation.



3.2   Delegation -
Subject to the, Act, the articles, the by-laws and any unanimous shareholder
agreement, the board may from time to time delegate to a director, a committee
of directors or an officer of the Corporation or such other person or persons so
designated by the board all or any of the powers conferred on the board by
section 3.1 or by the Act to such extent and in such manner as the board shall
determine at the time of each such delegation.



4 - DIRECTORS



4.1   Duties of Directors - Subject to any unanimous shareholder
 agreement, the board shall manage or supervise the management of
the business and affairs of the Corporation.



4.2   Qualifications of
Directors - At least half of the directors on the board shall be resident
Canadians but where the Corporation has only one director, that director shall
be a resident Canadian. No person shall be elected or appointed a director if
that person is less than 18 years of age, of unsound mind and has been so found
by a court in Canada or elsewhere, isnot an individual, or has the status of bankrupt.
  A director need not hold shares issued by the Corporation.



4.3   Number of
Directors - The board shall consist of such number of directors as shall be
set out in the articles or as may from time to time be determined in accordance
with the Act. Where the board is empowered by special resolution to determine
the number of directors within a range set out in the articles:



(a) 
the directors may appoint additional directors provided that after such
appointment the total number of directors would not be greater than one and one
third times the number of directors required to have been elected at the last
annual meeting nor greater than the maximum number set out above; and



(b) the number of directors to be elected at the annual meeting
 shall be the, number of directors last determined by the board.



4.4   Consent to Act -
 A person who is elected or appointed a director
 is not a director unless:



(a) he, was present at the meeting when he was elected or appointed
 and did not refuse to act as a director, or



(b) if he was not present at the meeting when he was elected or
 appointed,



      
    (i)   he consented
 to act as a director in writing before his election or appointment or within 10 days after it,
 or

          (ii)   
he has acted as a director pursuant to the election or appointment.

4.5   Quorum - A
majority of the number as determined from time to time in accordance with the
Act shall constitute a quorum for the transaction of business. Where the
Corporation has fewer than three directors, all directors must be present at any
meeting to constitute a quorum for the transaction of business. Notwithstanding
vacancies, a quorum of directors may exercise all the powers of the board.



4.6   Election and
Term - Directors shall be elected by the shareholders at the first meeting
of shareholders after the effective date of this by-law and at each succeeding
annual meeting at which an election of directors is required and shall hold
office until the next annual meeting of shareholders or, if elected for an
expressly stated term, for a term expiring not later than the close of the third
annual meeting of shareholders following the election. The number of directors
to be elected at any such meeting shall be that number most recently determined
in the manner referred to in section 4.3. The election need not be by ballot
unless a ballot is demanded by any shareholder or required by the chairman in
accordance with section 8.17. If an election of directors is not held at an
annual meeting of shareholders at which such election is required, the incumbent
directors shall continue in office until their successors are elected.



4.7    Removal of
Directors - Subject to the provisions of the Act, the shareholders may, by
ordinary resolution passed by a majority of the votes cast at a meeting of
shareholders, remove any director and may at that meeting elect a qualified
person in place of that director for the unexpired term of such director’s
predecessor.



4.8    Ceasing- to Hold
Office - A director may resign as director by delivering a written
resignation to the Corporation and such resignation becomes effective at the
time the resignation is received by the Corporation or the time specified in the
resignation whichever is later, A director shall forthwith cease to hold office
as a director should the director cease to be qualified in accordance with the
Act. Any attempt to amend or terminate any unanimous shareholder agreement
without written consent of all persons who are then directors of the Corporation
shall constitute the immediately effective resignation of all such directors who
have not so consented.



4.9    Vacancies -
Subject to the Act, whenever the board has fewer than the number of members
elected, the directors then in office, if constituting a quorum (and
notwithstanding that the majority of such directors are not resident Canadians),
may appoint a qualified person to the board to hold office for a term expiring
at the close of the next annual meeting of shareholders. Whenever a vacancy
shall occur on the board which results in the board not having a quorum, the
remaining directors shall forthwith call a special meeting of shareholders to
fill the vacancy. If the board falls to call such meeting or if there are no
such directors then in office, any shareholder may call the meeting. Where the
number or the minimum number of directors is increased any vacancy resulting
from such increase shall be filled by election at a special meeting of
shareholders.



4.10    Action by the
Board - Subject to any unanimous shareholder agreement, the board shall
exercise its powers by or pursuant to a by-law or resolution either passed at a
meeting of directors at which a quorum is present and at which a majority of the
directors present are resident Canadians or consented to by the signatures of
all the directors then in office if constituting a quorum. Where a corporation
has fewer than three directors, one of the directors present at a meeting of
directors shall be a resident Canadian. Subject to the Act, the board may
transact business at a meeting of directors where a majority of resident
Canadian directors is not present if a resident Canadian director who is unable
to be ’ present approves in writing or by telephone or other communications
facilities the business transacted at the meeting, and a majority of resident
Canadian directors would have been present had that director been present at the
meeting. Where the Corporation has only one director, that director may
constitute a meeting. 



4.11    Action in
Writing - A resolution in writing, signed by all the directors entitled to
vote on that resolution at a meeting of directors or a committee of directors,
is as valid as if it had been passed at a meeting of directors or a committee of
directors. 



4.12    Meetings by
Telephone - Any director may participate in a meeting of the board by means
of such telephone, electronic, or other communication facilities as permit all
persons participating in the meeting to communicate with each other
simultaneously and instantaneously, if all the directors present at or
participating in the meeting consent to the holding of meetings in such manner.



4.13   Place of Meetings - Meetings of the board may be held at the
 registered office of the Corporation or at any other place within or outside Alberta.

4.14    Calling of
Meetings – Meetings of the board shall be held from time to time at
such place, on such day and at such time as the board, the chairman of the
board, the managing director, the president, the secretary or any two directors
may determine.



4.15    Notice of
Meetings - Notice of the time and place of each meeting of the board shall
be given to each director not less than 48 hours before the time when the
meeting is to be held and need not be in writing.



4.16    First Meeting of
New Board - Provided a quorum of directors is present, each newly elected
board may without notice hold its first meeting following the meeting of
shareholders at which such board is elected.



4.17   Adjourned Meeting - Notice of an adjourned meeting
 of the directors is not required if the time and place of the adjourned
meeting is announced at the original meeting.



4.18    Regular
Meetings - The board may appoint a day or days in any month or months for
regular meetings at a place and hour to be named. A copy of any resolution by
the board fixing the time and place of regular meetings of the board shall be
sent to each-i director forthwith after being passed, but no other, notice shall
be required for any such regular meeting.



4.19    Votes to Govern
- - At all meetings of the board any question shall be decided by a majority of
the votes cast on the question and in the case, of an equality of votes the
chairman of the meeting shall be entitled to a second or casting vote. Any
question at a meeting of the board shall be decided by a show of hands unless a
ballot is required or demanded.



4.20    Chairman and
Secretary - The chairman of the board or, in the absence of the chairman,
the president if a director or, in the, absence of the president, a
vice-president who is a director shall be chairman of any meeting of the board.
If none of the said officers is present, the directors present shall choose one
of their number to be chairman. The secretary of the Corporation shall act as
secretary at any meeting of the board and, if the secretary of the Corporation
be absent, the chairman of the meeting shall appoint a person who need not be a
director to art as secretary of the meeting.



4.21    Remuneration and
Expenses - Subject to any unanimous shareholder agreement, the directors
shall be paid such remuneration for their services as directors as the board may
from time to time authorize. The directors shall also be entitled to be paid in
respect of travelling and other expenses properly incurred by them in attending
meetings of the board or any committee thereof or in otherwise serving the
Corporation. Nothing herein contained shall preclude any director from serving
the Corporation in any other capacity and receiving remuneration therefor.



4.22    Conflict of
Interest - Subject to and in accordance with the provisions of the Act, a
director or officer of the Corporation who is a party to a material contract or
transaction or proposed material contract or transaction with the Corporation,
or is a director or an officer of or has a material interest in, any person who
is a party to a material contract or transaction or proposed material contract
or transaction with the Corporation, shall disclose in writing to the
Corporation or request to have entered in the minutes of meetings of directors
the nature and extent of such interest, and my such director shall refrain from
voting in respect thereof unless otherwise permitted by the Act.



5 - COMMITTEES



5.1    Committees of
Directors - The board may appoint, from their number, a committee or
committees of directors, however designated, and delegate to such committee or
committees any of the powers of the board except powers to:



(a) submit to the shareholders
 any question or matter requiring the approval of the shareholders;



(b) fill a vacancy among the directors or in the office of auditor;




(c) issue securities except in the manner and on the terms
 authorized by the directors;



(d) declare dividends;



(e) purchase, redeem or otherwise acquire shares issued by the
 Corporation, except in the manner and on the terms
                  authorized by the directors;



(f) pay a commission for the sale of shares of the Corporation;



(g) approve a management proxy circular;



(h) approve any annual financial statements; or



(i) adopt, amend or repeal by-laws.



At least half of the members of any such
 committee shall be resident Canadians.



5.2   Transaction of
Business - The powers of a committee of directors may be exercised by a
meeting at which a quorum is present or by resolution in writing signed by all
the members of such committee who would have been entitled to vote on that
resolution at a meeting of the committee. Meetings of such committee may be held
at any place in or outside Alberta and, subject to the provisions of section
4.12 which shall be applicable mutatis mutandis, may be held by means of
telephone or other communications equipment.



5.3   Procedure -
Unless otherwise determined by the board, each committee shall have the power to
fix its quorum at not less than a majority of its members, to elect its chairman
and to regulate its procedure.



so appointed. The board may
specify the duties of such officers and, in accordance with this bylaw and
subject to the provisions of the Act, delegate to such officers powers to Manage
the business and affairs of the Corporation other than any of the powers listed
in section 5.1. Except for a managing director and a chairman of the board, an
officer need not be a director and one person may hold more than one office. The
president or such other officer as the board may designate shall be the chief
executive officer of the Corporation.



6.2    Agents and
Attorneys - The board shall have the power from time to time to appoint
agents or attorneys for the Corporation in or out of Alberta with such powers of
management or otherwise (including the power to sub-delegate) as the board may
determine.



6.3    Conflict of
Interest - An officer shall disclose an interest in any material contract or
transaction or proposed material contract or transaction with the Corporation in
accordance with section 4.22.



7 - PROTECTION OF DIRECTORS AND OFFICERS



7.1    Indemnity of
Directors and Officers - Subject to section 119 of the Act, the Corporation
shall indemnify a director or officer of the Corporation, a former director or
officer of the Corporation or a person who acts or acted at the
Corporation’s request as a director or officer of a body corporate of which
the Corporation is or was a shareholder or creditor, and the heirs and legal
representatives of any such person, against all costs, charges and expenses,
including an amount paid to settle an action or satisfy a judgment, reasonably
incurred by such person in respect of any civil, criminal or administrative
action or proceeding to which the person is made a party by reason of being or
having been a director or officer of such corporation or body corporate, if



(a) the person acted honestly and in good faith with a view
 to the best interests of the Corporation; and



(b) 
in the case of a criminal or administrative action or proceeding that is
enforced by a monetary penalty, the person had reasonable grounds for believing
that the relevant conduct was lawful.



The Corporation may, with
the approval of the court, indemnify a person referred to above in respect of an
action by or on behalf of the Corporation or body corporate to procure a
judgment in its favour, to which the person is made a party by reason of bring
or having been a director or an officer of the Corporation or body corporate,
against all costs, charges and expenses reasonably incurred by that person in
connection with such action if the person fulfills the conditions set out in (a)
and (b) above.



Notwithstanding anything in
this section, a person referred to above is entitled to indemnity from the
Corporation in respect of all costs, charges and expenses reasonably incurred by
that person in connection with the defense of any civil, criminal or
administrative action or proceeding to which the person is made a party by
reason of being or having been a director or officer of the Corporation or body
corporate, if the person seeking indemnity,



(a) was substantially successful on the merits in that person's
 defense of the action or proceeding;



(b) fulfills the conditions set out in (a) and (b) above; and



(c) is fairly and reasonably entitled to indemnity.




7.2    Insurance -
Subject to the Act, the Corporation may purchase and maintain insurance for the
benefit of any person referenced to above against any liability incurred by that
person,



(a) 
in the capacity as a director or officer of the Corporation, except where the
liability relates to that person’s failure to act honestly and in good
faith with a view to the best interests of the, Corporation; or



(b) 
in the capacity as a director or officer of another body corporate where said
person acts or acted in that capacity at the Corporation’s request, except
where the liability relates to that person’s future to act honestly and in
good faith with a view to the best interests of the body corporate.



8 - MEETINGS OF SHAREHOLDERS




8.1   Annual Meetings
- - The annual meeting of shareholders shall be held on such day and at such time
in each year as the board, or the chairman of the board, or the president, in
the absence of the chairman of the board, may from time to time determine, for
the purpose of considering the financial statements and reports required by the
Act to be placed before the annual meeting, electing directors, appointing
auditors and the transaction of such other business as may properly be brought
before the meeting.



8.2   Special Meetings
- - The board shall have power to call a special meeting of shareholders at any
time.



8.3    Resolution in Lieu
of Meeting - Except where a written statement is submitted by a director or
where representations in writing are submitted by an auditor in accordance with
the provisions of the Act, a resolution in writing signed by all the
shareholders entitled to vote on that resolution at a meeting of shareholders is
as valid as if it had been passed at a meeting of the shareholders; and a
resolution in writing dealing with all matters required to be dealt with at a
meeting of shareholders, and signed by all the shareholders entitled to vote at
Such meeting, satisfies all the requirements of the Act relating to meetings of
shareholders.



8.4    Place of
Meetings - Subject to the articles and any unanimous shareholder agreement,
a meeting of shareholders of the Corporation shall be held at such place in or
outside Alberta as the directors determine or, in the absence of such a
determination, at the place where the registered office of the Corporation is
located.



8.5    Notices of
Meetings - Notice of the time and place of every meeting of shareholders
shall be sent not less than 21 days and not more than 50 days before the meeting
to each shareholder entitled to vote at the meeting, to each director and to the
auditor of the Corporation. Notice of a meeting of shareholders at which special
business is to be transacted shall state or be accompanied by a statement of (I)
the nature of that business in sufficient detail to permit the shareholder to
form a reasoned judgment thereon and (ii) the text of any special resolution or
by-law to be submitted to the meeting. All business transacted at a special
meeting of shareholders and all business transacted at an annual meeting of
shareholders, except consideration of the minutes of an earlier meeting, the
financial statements and auditor’s report, election of directors and
reappointment of the incumbent auditor, is deemed to be special business.



8.6    Record Date for
Notice - The board may fix in advance a record date, preceding the date of
any meeting of shareholders by not more than 50 days and not less than 21 days,
for the determination of the shareholders entitled to notice of the meeting,
provided that notice of any such record date is given, not less than 7 days
before such record date, by advertisement in a newspaper published or
distributed in the place where the Corporation has its registered office and in
each place in Canada where it has a transfer agent or where a transfer of the
Corporation’s shares may be recorded, and, where applicable, by written
notice to each stock exchange in Canada on which the Corporation’s shares
are listed for trading unless notice of the record date is waived in writing by
every holder of a share of the class or series affected whose name is set out in
the securities register of the Corporation at the close of business on the day
the directors fix the record date. If no record date is fixed the record date
for the determination of the shareholders entitled to notice of the meeting
shall be at the close of business on the day immediately preceding the day on
which the notice is given.



8.7    Chairman and
Secretary - The chairman of the board or, in the absence of the chairman,
the president or, in the absence of the president, a vice-president shall be
chairman of any meeting of shareholders and, if none of the said officers be
present within 15 minutes after the time appointed for holding the meeting, the
shareholders present and entitled to vote shall choose a chairman from amongst
themselves. The secretary of the Corporation shah act as secretary at any
meeting of shareholders or, if the secretary of the Corporation be absent, the
chairman of the meeting shall appoint some person who need not be a shareholder,
to act as secretary of the meeting.



8.8    Persons Entitled to
be Present - The only persons entitled to be present at a meeting of
shareholders shall be those entitled to vote thereat, the directors and auditors
of the Corporation and others who, although not entitled to vote, are entitled
or required under any provision of the Act or the articles or by-laws to be
present at the meeting. Any other person may be admitted only on the invitation
of the chairman of the meeting or with the consent of the meeting.



8.9    Quorum - A
quorum of shareholders is present at a meeting of shareholders irrespective of
the number of persons actually present at the meeting, if the holders of a
majority of the shares entitled to vote at the meeting, are present in person or
represented by proxy. A quorum need not be present throughout the meeting
provided that a quorum is present at the opening of the meeting.



8.10   Right to Vote - Each share of the Corporation entities
 the holder of it to one vote at a meeting of shareholders.



8.11    Proxies and
Representatives - Every shareholder entitled to vote at a meeting of
shareholders may, by means of a proxy, appoint a proxyholder, and one or more
alternate proxyholders, who need not be shareholders, as that shareholder’s
nominee, to attend and act at the meeting in the manner, to the extent, and with
the authority conferred by the proxy. A proxy shall be in writing executed by
the shareholder or shareholder’s attorney authorized in writing. A body
corporate or association which is a shareholder of the Corporation may be
represented at a meeting of shareholders by any individual authorized by a
resolution of its directors or governing body of the body corporate or
association and such individual may exercise on behalf of the body corporate or
association represented all the powers it could exercise if it were an
individual shareholder. In the case of a proxy appointing a proxyholder to
attend and act at a meeting or meetings of shareholders of an offering
corporation, the proxy ceases to be valid one year from its date. 



8.12    Time for Deposit of
Proxies - The directors may by resolution fix a time not exceeding
forty-eight hours, excluding non-business days, preceding any meeting or
adjourned, meeting of shareholders before which time proxies to be used at that
meeting must be deposited with the Corporation or an agent thereof, and any
period of time so fixed shall be specified in the notice calling the meeting. A
proxy may be used at the meeting only if, prior to the time so specified, it
shall have been deposited with the Corporation or an agent thereof specified in
such notice or, if no such time is specified in such notice, it shall have been
received by the secretary of the Corporation or by the chairman of the meeting
or adjournment thereof prior to the time of voting.



8.13    Joint
Shareholders - Where two or more persons hold the same shares jointly, one
of those holders present or represented by proxy at a meeting of shareholders
may in the absence of the other or others vote such shares, but, if more than
one of such persons are present or represented by proxy, that one of such
persons whose name stands first on the securities register of the Corporation or
that person’s proxy shall alone be entitled to vote such shares.



8.14    Votes to Govern
- - Except as otherwise required by the Act, all questions proposed for the
consideration of shareholders at a meeting of shareholders shall be determined
by the .majority of the votes cast, whether by a show of hands or by ballot, as
the case may be.



8.15    Casting Vote -
In case of an equality of votes at any meeting of shareholders either upon a
show of hands or upon a ballot, the chairman of the meeting shall be entitled to
a second or casting vote. 



8.16    Show of Hands -
Any question at a meeting of shareholders shall be decided by a show of hands
unless a ballot thereon is required or demanded as hereinafter provided. Upon a
show of hands every person who is present and entitled to vote thereon shall
have one vote. Whenever a vote by show of hands shall have been taken upon a
question, unless a ballot thereon is so required or demanded, a declaration by
the chairman of the meeting that the vote upon the question has been carried or
carried by a particular majority or not carried and an entry to that effect in
the minutes of the meeting shall be prima facie evidence of the fact without
proof of the number -or proportion of the votes recorded in favour of at against
any resolution or other proceeding in respect of the said question, and the
resu1t of the vote so taken shall be the decision of the shareholders upon the
said question.



8.17    Ballots - On
any question proposed for consideration at a meeting of shareholders, and
whether or not a show of hands has been taken thereon, the chairman may require,
or any shareholder or proxyholder entitled to vote at the meeting may demand, a
ballot, A ballot so required or demanded shall be taken in such manner as the
chairman shall direct. A requirement or demand for a ballot may be withdrawn at
any time prior to the taking of the ballot. If a ballot is taken each person
present shah be entitled, in respect of the shares which the person is entitled
to vote at the meeting upon the question, to that number of votes provided by
the Act or the articles, and the result of the ballot so taken shall be the
decision of the shareholders upon the said question.



8.18    Adjournment -
If a meeting of shareholders is adjourned for less than 30 days, it shall not be
necessary to give notice of the adjourned meeting, other than by announcement at
the earliest meeting that is adjourned. If a meeting of shareholders is
adjourned by one or more adjournments for an aggregate of 30 days or more,
notice of the adjourned meeting shall be given as for an original meeting.



8.19    One Shareholder
- - Where the Corporation has only one shareholder or only one holder of any class
or series of shares, the shareholder present in person or by proxy constitutes a
meeting.



9  -  SECURITIES



9.1    Options or
Rights - Subject to the provisions of the Act, the articles and any
unanimous shareholder agreement, the board may from time to time issue or grant
options to purchase or rights to acquire unissued shares of the Corporation at
such times and to such persons and for such consideration as the board shall
determine, provided that no share shall be issued until it is fully paid.



9.2    Commissions -
The board may from time to time authorize the Corporation to pay a reasonable
commission to any person in consideration of purchasing or agreeing to purchase
shares of the Corporation, whether from the Corporation or from any other
person, or procuring or agreeing to procure Purchasers for any such shares.



9.3    Securities
Records - The Corporation shall prepare and maintain, at its registered
office or at any other place in Alberta designated by the, board, a securities
register in which it records the securities
issued by it in registered form, showing with respect to each class or series of
securities:



(a) the names, alphabetically arranged, and the latest known
 address of each person who is or has been a security holder;



(b) the number of shares or other securities held by each
 holder; and



(c) the date and particulars of the issue and transfer of
 each security.



9.4    Register of
Transfer - The Corporation shall cause to be kept a register of transfers in
which all transfers of securities issued by the Corporation in registered form
and the date and other particulars of each transfer shall be set out.



9.5    Registration of
Transfer - Subject to the provisions of the Act, no transfer of shares shall
be registered in a securities register except upon presentation of the
certificate representing such shares with a transfer endorsed thereon or
delivered therewith duly executed by the registered holder or by the
holder’s attorney or successor duly appointed, together with such
reasonable assurance or evidence of signature, identification and authority to
transfer as the board may from time to time prescribe, upon payment of all
applicable taxes and any fees prescribed by the board or in accordance with the
Act upon compliance with such restrictions on transfer as are authorized by the
articles and upon satisfaction of any lien referred to in section 9.6.



9.6    Lien for
Indebtedness - Except in the case of any class or series of shares of the
 .Corporation listed on a stock exchange, the Corporation shall have a lien an
the shares registered in the name of a shareholder who is indebted to the
Corporation, to the extent of such indebtedness and such lien may be enforced,
subject to any provision of the articles and to any unanimous shareholder
agreement, by the sale of the shares thereby affected or by any other action,
suit, remedy or proceeding authorized or permitted by law or by equity and,
pending such enforcement, the Corporation may refuse to register a transfer of
the whole or part of such shares.



9.7    Non-recognition of
Trusts - Subject to the provisions of the Act, the Corporation may treat the
registered owner of a share as the person exclusively entitled to vote, to
receive notices, to receive any dividend or other payments in respect thereof
and otherwise to exercise all the rights and powers of an owner of a share.



9.8    Security
Instruments - Every holder of one or more securities of the Corporation
shall be entitled, at the holder’s option, to a security certificate in
respect of the securities held by that person or to a non-transferable written
acknowledgement of that person’s right to obtain a security certificate,
stating the number and class or series of shares held by that person as shown on
the securities register. Security certificates and acknowledgements of a
shareholder’s right to a security certificate, respectively, shall be in
such form as the board may from time to time approve. Unless otherwise ordered
by the board, security certificates shall be signed by any one of:



(a) the chairman of the board, the president, the managing
 director, a vice-president or a director,



or any one of:



(b) the secretary, treasurer, any assistant secretary or
 any assistant treasurer or a director



and need not be under
corporate seal. Signatures of signing officers may be printed or mechanically
reproduced in facsimile. upon security certificates and every such facsimile
shall for all purposes be deemed to be the signature of the officer whose
signature it reproduces and shall be binding upon the Corporation; provided that
at least one director or officer of the Corporation shall manually sign each
certificate (other than a scrip certificate or a certificate representing a
fractional share or a warrant or a promissory note that is not issued under a
trust indenture) in the absence of a manual signature thereon of a duly
appointed transfer agent, registrar, branch transfer agent or issuing or other
authenticating agent of the Corporation or trustee who certifies it in
accordance with a trust indenture. A security certificate executed as aforesaid
shall be valid notwithstanding that an officer whose facsimile signature appears
thereon no longer holds office at the date of issue of the certificate.



9.9    Replacement of
Security Certificates - Subject to the provisions of the Act, the board or
any officer or agent designated by the board may in the discretion of the board
or that person direct the issue of a new security certificate in lieu of and
upon cancellation of a security certificate claimed to have been lost,
apparently destroyed or wrongfully taken on payment of such fee, prescribed by
or in accordance with the Act, and on such terms as to indemnity, reimbursement
of expenses and evidence of loss and of title as the board may from time to time
prescribe, whether generally or in any particular case.



9.10    Joint
Shareholders - If two or more persons are registered as joint holders of any
share, the Corporation shall not be bound to issue more than one certificate in
respect thereof, and delivery of such certificate to one of such persons shall
be sufficient delivery to all of them. Any one of such persons may give
effectual receipts for the certificate issued in respect thereof or for any
dividend, bonus, return of capital or other money payable or warrant issuable in
respect of such share.



9.11    Deceased
Shareholders - In the event of the death of a holder, or of one of the joint
holders, of any share, the Corporation shall not be required to make any entry
in the securities register in respect thereof or to make payment of any
dividends thereon except upon production of all such documents as may be
required by the Act and upon compliance with the reasonable requirements of the
Corporation or transfer agent.



10   -   DIVIDENDS AND RIGHTS



10.1    Dividends -
Subject to the provisions of the Act, the articles and any unanimous shareholder
agreement, the board may from time to time declare dividends payable to the
shareholders according to their respective rights and interests in the
Corporation. Dividends may be paid in money or property or by issuing fully paid
shares or options or rights to acquire fully paid shares of the Corporation.



10.2    Dividend
Cheques - A dividend payable in cash shall be paid by cheque drawn on the
Corporation’s bankers or one of them to the order of each registered holder
of shares of the class or series in respect of which it has been declared and
mailed by prepaid ordinary mail to such registered holder at the address
recorded in the Corporation’s securities register, unless in each case such
holder otherwise directs, In the case of joint holders the cheque shall, unless
such joint holders otherwise direct, be made payable to the order of all of such
joint holders and, if more than one address is recorded in the
Corporation’s security register in respect of such joint holding, the
cheque shall be mailed to the first address so appearing. The mailing of such
cheque as aforesaid, unless the same, is not paid on due presentation, shall
satisfy and discharge the liability for the dividend to the extent of the sum
represented thereby plus the amount of any tax which the Corporation is required
to and does withhold.



10.3    Non-receipt or Loss
of Cheques - In the event of non-receipt or loss of any dividend cheque by
the person to whom it is sent, the Corporation shall issue, to such person a
replacement cheque for a like amount on such terms as to indemnity,
reimbursement of expenses and evidence of non-receipt and of title as the board
may from time to time prescribe, whether generally or in any particular case.



10.4    Record Date for
Dividends and Rights - The board may fix in advance a date as the record
date for the determination of the shareholders entitled to receive payment of a
dividend, entitled to participate in a liquidation or distribution, or for any
other purpose except to receive notice of or to vote at a meeting, but the
record date shall not precede by more than 50 days the particular action to be
taken, Notice of the record date shall be given, not less than 7 days before
such record date, by advertisement in a newspaper published or distributed in
the place where the. Corporation has its registered office and in each place in
Canada where it has a transfer agent or where a transfer of the
Corporation’s shares may be recorded and, where applicable, by written
notice to each stock exchange in Canada on which the Corporation’s shares
are listed for trading, unless notice of the record date is waived in writing by
every holder of a share of the class or series affected whose name is set out in
the securities register of the Corporation at the close of business on the day
the directors fix the record date, If no such record date is fixed, such record
date shall be the close of business on the day on which the directors pass the
resolutions relating thereto.



10.5    Unclaimed
Dividends - Any dividend unclaimed after a period of six years from the date
on which the same has been declared to be payable shall be forfeited and shall
revert to the Corporation.



11   -    NOTICES



11.1    Method of Giving
Notices - Any notice, communication or document (“notice”) to be
given or sent pursuant to the Act, the articles, the by-laws or otherwise to or
on a shareholder, director, officer, auditor or member of a committee of the
board shall be sufficiently given or sent if given or sent by prepaid mail,
prepaid transmitted or recorded communication, or delivered personally to such
person’s latest address as shown on the securities register of the
Corporation or, in the case of a director, if more current, the address as shown
in the most recent notice filed under the Act. A notice shall be deemed to have
been received on the date when it is delivered personally, or if by mail, at the
time it would be delivered in the ordinary course of mail, or on the date of
dispatch of a transmitted or recorded communication. The secretary may change or
cause to be changed the recorded address of any shareholder, director, officer,
auditor or member of a committee of the board in accordance with any information
believed by the secretary to be reliable.



11.2    Notice to Joint
Shareholders - If two or more persons are registered as joint holders of any
share, any notice shall be addressed to all of such joint holders but notice to
one of such persons shall be sufficient notice to all of them.



11.3    Computation of
Time - In computing the date when notice must be sent under any provision
requiring a specified period of days’ notice of any meeting or other event,
the period of days shall commence on the day following the sending of such
notice and shall terminate on the day preceding the date of the meeting or other
event provided that the last day of the period shall not be a non-business day.



11.4    Undelivered
Notices - If any notice given or sent to a shareholder pursuant to section
11.1 is returned on three consecutive occasions because the person cannot be
found, the Corporation shall not be required to give or send any further notice
to such shareholder until the Corporation is informed in writing of the new
address for such person.



11.5    Omissions and
Errors - The accident omission to give or send any notice to any
shareholder, director, officer, auditor or member of a committee of the board or
the non-receipt of any notice by any such person or any error in any notice not
affecting the substance thereof shall not invalidate any action taken at any
meeting held pursuant to such notice or otherwise based, thereon.



11.6    Persons Entitled by
Death or Operation of Law - Every person who, by operation of law, transfer,
death of a shareholder or any other means whatsoever, shall become entitled to
any share, shall be bound by every notice in respect of such share which shall
have been duly given or sent to the shareholder from whom the person derives
title to such share prior to that person’s name and address being entered
on the securities register (whether such notice was given or sent before or
after the happening of the event upon which that person becomes so entitled) and
prior to that person furnishing to the Corporation the proof of authority or
evidence of entitlement prescribed by the Act.



11.7    Waiver of
Notice - Any shareholder (or shareholder’s duly appointed proxyholder),
director, officer, auditor or member of a committee of the board may at any time
waive the giving or sending of any notice, or waive or abridge the time, for any
notice, required to be given to that person under any provision of the Act, the
articles, the, by-laws or otherwise and such waiver or abridgement shall cure
any default in the giving or sending or in, the time of such notice, as the case
may be. Any such waiver or abridgement shall be in writing except a waiver of
notice of a meeting of shareholders or of the board which may be given in any
manner. Attendance of a director at a meeting of directors or of a shareholder
or any other person entitled to attend a meeting of shareholders is a waiver of
notice of the meeting except where such director, shareholder or other person,
as the case may be, attends a meeting for the express purpose of objecting to
the transaction of any business on the grounds that the meeting is not lawfully
called.



        The
foregoing By-law No. I is hereby passed as evidenced by the signatures of all
the directors of the Corporation pursuant to the provisions of the Business
Corporation Act (Alberta).



        DATED this  28th  day  of  April,  2000.





/s/ Philip C. Ackerman          
                
                
                
                
                
     /s/ Alyson F. Goldman       
         

Philip C. Ackerman          
                
                
                
                
                
           Alyson F. Goldman





/s/ Bernard J. Kennedy         
                
                
                
                
                
     /s/ Chris W. Nixon            
   
         

Bernard J. Kennedy          
                
                
                
                
                
          Chris W. Nixon





        The
foregoing By-law No. I is hereby confirmed as evidenced by the signature of the
sole shareholder of the Corporation entitled to vote pursuant to the provisions
of the Business Corporations Act (Alberta).



        DATED this 28th day of April, 2000.





                     
3041765 NOVA SCOTIA COMPANY


                 
/s/ Bernard J. Kennedy









EX-99
12
0012.txt
TAX ALLOCATION AGREEMENT




                        AGREEMENT PURSUANT TO RULE 45 (c)

                  UNDER THE PUBLIC UTILITY HOLDING ACT OF 1935



         WHEREAS,   National  Fuel  Gas  Company  ("National"),   a  corporation
organized  under the laws of the State of New  Jersey and a  registered  holding
company under the Public Utility Holding  Company Act of 1935 ("Act"),  together
with its wholly-owned domestic subsidiaries, listed below:

         National Fuel Gas Distribution Corporation
         National Fuel Gas Supply Corporation
         Seneca Resources Corporation
         Leidy Hub, Inc.
         Highland Forest Resources, Inc.
         Data-Track Account Services, Inc.
         National Fuel Resources, Inc.
         Horizon Energy Development, Inc.
         Seneca Independence Pipeline Company
         Upstate Energy Inc.
         Niagara Independence Marketing Company
         Horizon Energy Holdings, Inc., a wholly-owned subsidiary of Horizon
           Energy Development, Inc.
         NFR Power, Inc.


join annually in the filing of a consolidated federal income tax return; and

         WHEREAS,   it  is  the  intention  of  National  and  its  subsidiaries
(hereinafter  collectively  referred  to as the  "System"),  to enter into a Tax
Agreement for the allocation of current federal income taxes; and
         WHEREAS,  Rule 45 (c) of the Act has been adopted by the Securities and
Exchange  Commission  with the  specific  intention  of  providing  a method  of
allocation of consolidated  federal income taxes by a registered holding company
and its subsidiaries;
         NOW,  THEREFORE,  the System  does hereby  covenant  and agree with one
another that the consolidated current federal income tax liability of the System
shall be  allocated  pursuant to Rule 45 (c) of the Act, so that each company of
the System will benefit mutually from the application of said Rule, as follows:
         FIRST:  There shall be allocated  and preserved to each company the tax
effects of its own capital gains or losses which shall be subject to the capital
gains rate, if applicable, its tax credits,  investment tax credit recapture and
the effects of any other  material  items taxed at different  rates or involving
special  benefits  or  limitations  as may  result  from  an  unexpected  event,
including  changes to the  Internal  Revenue Code which may be  applicable  to a
particular company, including its carry-over amounts to the extent those amounts
are absorbed in the taxable year.
         SECOND:  After giving  effect to the special  allocations  described in
paragraph  First above,  the balance of the current tax  liability of the System
shall  be  allocated  to each  System  company  on the  basis  of each of  their
respective  contributions of corporate taxable income to the total  consolidated
taxable  income of the  System,  excluding  income  subject to  taxation  at the
capital gains rate, if applicable. The tax attributable to such income will have
been separately allocated pursuant to paragraph First above. However, so long as
National has negative  corporate  taxable income,  no portion of the current tax
liability shall be allocated to National as a corporate tax credit. Instead, the
negative corporate taxable income of National shall be allocated to those System
companies which have positive  corporate taxable income, on the basis of each of
these companies'  contribution of positive corporate taxable income to the total
positive  corporate taxable income of the System. The tax allocated to a company
under this  paragraph,  which may be either  positive  or  negative  (except for
National)  shall be equal to the  consolidated  tax  liability  multiplied  by a
fraction, the numerator of which is the positive corporate taxable income of the
Company (as adjusted by National's  negative  corporate taxable income described
in  this  paragraph  Second  above  and in  paragraph  Third);  or the  negative
corporate  taxable  income of the Company  (as  adjusted  in  paragraph  Third),
including any carry-over loss attributable to the Company to the extent absorbed
in the taxable year, and the  denominator of which is the  consolidated  taxable
income of the System (as adjusted in paragraphs First and Third). Companies with
taxable  income  will be  allocated  a tax  liability  under this  method  while
companies with net operating  losses  (except  National) will be allocated a tax
benefit or credit.
         THIRD:  The tax effect of intercompany  transactions  eliminated in the
calculation  of  consolidated  taxable  income  shall  be  eliminated  from  the
corporate  taxable income of the companies  involved in such transactions in the
calculations provided in paragraph Second.
         FOURTH:   Any   consolidated   alternative   minimum   income  tax  and
environmental tax arising from consolidated  alternative  minimum taxable income
(AMTI)  will be  allocated  among  the  companies  on the basis of each of their
respective  contributions  of positive  AMTI to the total  positive  AMTI of the
System.
         FIFTH:  Under the method of allocation  described in  paragraphs  First
through Fourth above, the companies agree that the tax allocated to each company
(except  National) shall not exceed the amount of tax of such company based upon
a separate  return  computed as if such company had always filed its tax returns
on a separate  return  basis.  However,  in computing  the  separate  return tax
liability of a company,  items of  carry-forward,  carry-back  and  intercompany
transactions, to the extent that any or all of these items have been utilized by
the System in a prior taxable year's allocation, will be disregarded in order to
comply with the separate return  limitation  provisions set forth in Rule 45 (c)
of the  Act and  regulations  promulgated  under  Section  1552 of the  Internal
Revenue  Code.  Thus,  to the extent  that a company  receives a tax  benefit or
credit  pursuant to  paragraph  Second  above,  such  benefit or credit would be
applied to reduce any tax credits in future  years to which such  company  might
otherwise  become  entitled under the separate return  limitation  provisions of
Rule 45 (c) of the Act and  regulations  promulgated  under  Section 1552 of the
Internal Revenue Code.
         IT IS FURTHER AGREED by and among the System as follows:
         I.  PAYMENTS:  It is agreed  that those  companies  allocated a current
federal income tax liability under this agreement will pay the Internal  Revenue
Service a portion of that  liability in the amounts and on the dates directed by
National,  as determined and pursuant to the applicable sections of the Internal
Revenue Code.  Another  portion of the current  federal  income tax liability of
those  companies  shall  be  paid  by them to the  other  companies  which  were
allocated a tax benefit.  Such  payments will also be made in the amounts and on
the dates directed by National.
         II.  SEPARATE RETURN  LIABILITY:  The System intends that the result of
         the proposed  method of allocation  and payment will be: (a) No company
         will pay more than its  separate  return  liability as if it had always
         filed  separate  returns.   However,  the  qualifications  set  out  in
         paragraph  Fifth above  concerning the calculation of a separate return
         tax shall apply;  (b) Each company having a net operating loss or other
         net tax benefit will  receive in current  cash  payments the benefit of
         its own net operating loss (except as described in paragraph Second) or
         other net tax  benefits  to the  extent  that the other  companies  can
         utilize  such items to offset the tax  liability  they would  otherwise
         have  on a  separate  return  basis.  III.  EFFECTIVE  DATE:  This  Tax
         Agreement  will be effective for  allocation of the current  income tax
         liability of the system for
the fiscal year 1999 and all subsequent  years until this Tax Agreement shall be
amended in writing by each of the companies which is a party thereto.
         IV. APPROVAL AND  AMENDMENTS:  Any amendments to this Tax Agreement may
be made only with the unanimous  written  consent of all the parties  hereto.  A
copy of this Tax Agreement is being filed as an exhibit to  National's  Form U5S
Annual  Report to the  Securities  and  Exchange  Commission  for the year ended
September 30, 2000.  Any  amendments  to this Tax Agreement  will be filed as an
exhibit  to  National's  Form  U5S for  the  year  when  the  amendment  becomes
effective.  It is  contemplated  that any additional  companies  which hereafter
become  associated  with the  System  shall  have the  option of  joining in and
becoming a party to this Tax Agreement by amendment thereto.
         V. PRIOR AGREEMENTS  SUPERSEDED:  Any prior agreements  relating to the
allocation of income tax liability among the System are superseded.
         IN WITNESS  WHEREOF,  each of the  parties  hereto have caused this Tax
Agreement  to be executed  in its name and on its behalf by one of its  officers
duly authorized, and its corporate seal to be affixed hereto by its Secretary on
this 29th day of January 2001.
                                           NATIONAL FUEL GAS COMPANY

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           NATIONAL FUEL GAS DISTRIBUTION
                                                CORPORATION

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           NATIONAL FUEL GAS SUPPLY
                                                CORPORATION

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           SENECA RESOURCES CORPORATION

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           LEIDY HUB, INC.

                                           By: /s/Gerald T. Wehrlin
                                           ------------------------
                                                Gerald T. Wehrlin
                                                      Treasurer

                                           HIGHLAND FOREST RESOURCES, INC.

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer

                                            DATA-TRACK ACCOUNT SERVICES,
                                              INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer


                                           NATIONAL FUEL RESOURCES, INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer

                                           HORIZON ENERGY DEVELOPMENT,
                                               INC.

                                           By: /s/Ronald J. Tanski
                                           -----------------------
                                                Ronald J. Tanski
                                                      Treasurer


                                           SENECA INDEPENDENCE PIPELINE
                                                COMPANY

                                           By: /s/Walter E. DeForest
                                           -----------------------
                                                Walter E. DeForest
                                                      Treasurer


                                           UPSTATE ENERGY INC.

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           NIAGARA INDEPENDENCE
                                             MARKETING COMPANY

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           HORIZON ENERGY HOLDINGS, INC.

                                           By: /s/Ronald J. Tanski
                                           -----------------------
                                                Ronald J. Tanski
                                                      Treasurer


                                           NFR POWER, INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer





EX-99
13
0013.txt
ORGANIZATION CHART


                                                                   Exhibit H-2


                            National Fuel Gas Company
         Organization Chart of Foreign Utility Company Ownership (FUCO)
                            As of September 30, 2000




                           ---------------------------
                            National Fuel Gas Company
                           ---------------------------

                                                     100%
                       ----------------------------------
                        Horizon Energy Development, Inc.
                       ----------------------------------

                                                     100%
                         -------------------------------
                          Horizon Energy Holdings, Inc.
                         -------------------------------

                                                     100%
                        ---------------------------------
                         Horizon Energy Development B.V.
                        ---------------------------------

                                                   84.73%
                          ----------------------------
                               United Energy, a.s.
                                     (FUCO)
                          ----------------------------

                                                      70%
                            ------------------------
                             Teplarna Liberec, a.s.
                                     (FUCO)
                            ------------------------




Note: Percents reported represent percent of voting power as of September 30,
2000





EX-99
14
0014.txt
AUDITOR'S STATEMENT


                                                                 Exhibit I-1

                              Auditor's statement

Auditors report to the shareholders of Prvni Severozapadni Teplarenska, a.s.,
the legal successor of Severoceske Teplarny, a.s.

We have audited the financial statements of Severoceske  teplarny,  a.s. for the
year ended 31 December  1999.  The Board of  Directors  is  responsible  for the
preparation of the financial statements and for maintaining  accounting which is
complete,  supportable and correct.  Our responsibility is to express an opinion
on the financial  statements  taken as a whole,  based on our audit performed in
accordance  with the CNR Act no.  524/1992 Coll., on Auditors and the Chamber of
Auditors of the Czech Republic and the auditing guidelines issued by the Chamber
of Auditors.

The  auditing  guidelines  require  that we plan and perform the audit to obtain
reasonable  assurance  that  the  financial  statements  are  free  of  material
misstatements.  Our audit includes an examination of the evidence supporting the
financial  statements  with respect to the closed books of the company  wound up
without  liquidation in the  transformation.  Our audit also includes  assessing
whether  the  accounting  policies  used  and  significant   estimates  made  by
management are fair and suitable, as well as evaluating the overall presentation
of the financial  statements.  Our audit  procedures  were carried out on a test
basis and with regard to the principle of materiality. We believe that our audit
provides a reasonable basis for expressing our opinion.

In our  opinion,  the  financial  statements  present  fairly,  in all  material
aspects, the assets,  liabilities,  equity and financial position of Severoceske
teplarny,  a.s., as at 31 December  1999 and the financial  results for the year
then ended in accordance with valid acts and relevant accounting legislation.

In  conclusion  we note that the joint stock  company  Severoceske  teplarny was
deleted from the Registrar of Companies at 31, December 1999 and merged with the
joint stock company Prvni severozapadni teplarenska.

Prague March 26, 2000

Auditing company:                    Statutory auditor:

Consultas - Audit, s.r.o.            Jaroslav Suva
License number 87                    License number 234





                           SEVEROCESKE TEPLARNY, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET


  ASSETS                                    12/31/99           12/31/98
  ------                                   ---------          ---------
                                                     (CZK 000's)
                                            ---------------------------

Total Assets                                2,038,985         1,967,372
                                            =========         =========

Intang. & Tang. Assets & Invest.            1,820,578         1,609,480
                                            ---------         ---------
  Intangible Assets                             4,202             3,216
                                            ---------         ---------
    Software                                    3,256               718
    Intangibles in Progress                       946             2,498
    Advances for Intangibles                        -                 -
                                            ---------         ---------
  Tangible Assets                           1,370,604         1,337,659
                                            ---------         ---------
    Land                                       34,172            33,773
    Building, Halls & Constructions           897,851           927,602
    Sep. Movab. Items & Groups of
     Mov. Items                               359,607           322,639
    Other Tangible Assets                          20                20
    Tangibles in Progress                      73,922            52,341
    Advances for Tangibles                      5,032             1,334
    Adjustment to Acquired Property                 -               (50)
                                            ---------         ---------
  Financial Investment                        445,772           268,605
                                            ---------         ---------
    Major. Sharehol. & Particip.
     Inter. (50%)                             411,523           211,823
    Subst. Sharhol. & Partic.
     Inter. (20-50%)                           34,249            44,249
    Intergroup Loans                                -             5,155
    Other Loans & Financial Investment              -             7,378
                                            ---------         ---------
Current Assets                                214,950           355,981
                                            ---------         ---------
  Inventory                                    44,334            55,203
                                            ---------         ---------
    Materials                                  40,152            42,182
    Work in Progress & Semi-Finished
     Product.                                   4,182            13,021
                                            ---------         ---------
  Long-Term Receivables                        12,601            11,373
                                            ---------         ---------
    Trade and Other Receivables                11,801            10,345
    Other Receivables                             800             1,028
                                            ---------         ---------
  Short-Term Receivables                      143,848           120,704
                                            ---------         ---------
    Trade Receivables                         127,270           109,159
    Receivables From Taxes & Subsidies          7,749             8,590
    Receiv. From Related Comp.
     (Sharehol. 20-50%)                         7,901                 -
    Other Receivables                             928             2,955
                                            ---------         ---------
  Financial Accounts                           14,167           168,701
                                            ---------         ---------
    Cash                                          299               377
    Bank Accounts                              13,868            28,324
    Short-Term Financial Assets                     -           140,000
                                            ---------         ---------
Other Assets                                    3,457             1,911
                                            ---------         ---------
  Temporary Accounts of Assets                  2,272             1,798
                                            ---------         ---------
    Prepaid Expenses                            1,338             1,752
    Unbilled Revenue                              934                46
                                            ---------         ---------
  Contingencies-Gain                            1,185               113






                           SEVEROCESKE TEPLARNY, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET


                                            12/31/99           12/31/98
                                           ---------          ---------
                                                   (CZK 000's)
                                           ----------------------------

Total Capital & Liabilities                2,038,985          1,967,372
                                           =========          =========
Capital                                    1,783,770          1,719,379
                                           ---------          ---------
  Basic Capital                            1,133,279          1,133,279
  Capital Funds                               25,747             25,030
                                           ---------          ---------
  Funds Created From Profit                  130,506            124,105
                                           ---------          ---------
    Legal Reserve Fund                       127,102            121,278
    Statutory and Other Funds                  3,404              2,827
                                           ---------          ---------
  Retained Earnings                          377,309            320,491
  Profit and Loss of Current Accounting
   Period                                    116,929            116,474
                                           ---------          ---------
Liabilities                                  248,231            244,223
                                           ---------          ---------
  Reserves                                         -              9,863
                                           ---------          ---------
    Legal Reserves (i.e. Tax Deductible)           -              9,863
    Other Reserves                                 -                  -
                                           ---------          ---------
  Long-Term Liabilities                          609              1,414
                                           ---------          ---------
  Short-Term Liabilities                      84,623             95,845
                                           ---------          ---------
    Trade Payables                            42,475             60,894
    Payables to Partners and Associations      1,293              2,389
    Payables to Employees                      1,029              1,071
    Social Security Payable                    2,635              2,757
    Taxes Payable                                693                852
    Deferred Taxes                            29,418             20,881
    Other Payables                             7,080              7,001
                                           ---------          ---------
  Bank Loans and Short Term Notes            162,999            137,101
                                           ---------          ---------
    Long-Term Bank Loans                     112,999            137,101
    Short-Term Bank Loans                     50,000                  -

Other Liabilities-Temporary Accounts of
 Liabilities                                   6,984              3,770
                                           ---------          ---------
    Accruals                                     712                232
                                           ---------          ---------
      Accruals                                   712                 75
      Deferred Income                              -                157
                                           ---------          ---------
    Contingencies-Loss                         6,272              3,538





                           SEVEROCESKE TEPLARNY, a.s.
                FINANCIAL STATEMENTS - PROFIT AND LOSS STATEMENT


                                            12/31/99           12/31/98
                                            --------           --------
                                                   (CZK 000's)
                                            ---------------------------


Operation Revenues (A)                       806,393            810,329
                                             -------            -------
  Revenues From Finished Products and
   Services                                  788,442            785,555
  Changes in Inventory                        (8,838)             6,599
  Capitalization (Of Own Work)                26,789             18,175
                                             -------            -------
Consumption From Operation (B)               421,848            461,934
                                             -------            -------
  Consumption of Material and Energy         344,280            373,580
  Services                                    77,568             88,354
                                             -------            -------
Value Added (A)-(B)=(C)                      384,545            348,395
                                             -------            -------
Personnel Expenses                           108,350            103,750
                                             -------            -------
  Wages & Salaries & Earn. Of Part &
   Coop. Members                              78,632             75,098
  Bonus. To Mem. Of Exec. Bodies of
   Companies & Coop.                             648                585
  Social Insurance & Other Expenses           27,238             26,219
  Statutory Social Expenses                    1,832              1,848
                                             -------            -------
Taxes and Fees                                 1,676              1,886
Amortization of Intangibles and
 Depreciation of Tangibles                    81,307             77,727
Rev. From Intangibles & Tangible
 Assets & Material Sold (+)                   24,704             29,903
Net Book Value of Intangible,
 Tangibles and Material Sold (-)              19,352             23,309
Reversal of Reserves & Prepaid Expenses (+)   11,150             24,550
Creation of Reserves & Prepaid Expenses (-)    1,288             10,304
Reversal of Provisions (+)                     5,229              3,746
Creation of Provisions (-)                     7,599              4,925
Other Operational Revenues (+)                   620              1,318
Other Operational Expenses (-)                11,299             13,343
                                             -------            -------
      Net Operating Results (D)              195,377            172,668
                                             -------            -------
Revenues From Sales of Securities and
 Deposits (+)                                    696              1,461
Sold Securities and Deposits (-)              10,300              1,233
Revenues from Financial Investments (+)            -              1,333
Revenues from Short-Term Financial Assets (+)  1,383                102
Interest Revenues (+)                          7,264             21,476
Interest Expenses (-)                         12,930             24,485
Other Financial Revenues (+)                       -                 65
Other Financial Expenses (-)                   4,422              4,615
                                             -------            -------
Transfer of Financial Revenues
Transfer of Financial Expenses
      Net Result From Financial
      Activities (E)                         (18,309)            (5,896)
                                             -------            -------
Income Taxes on Normal Activity (F)          (58,910             55,735
                                             -------            -------
  Due                                         50,372             53,277
  Deferred                                     8,538              2,458
                                             -------            -------
      Net Results After Taxes From Normal
       Activities (D)+(E)-(F)=(G)            118,158            111,037
                                             -------            -------
Extraordinary Revenues (+)                       475              9,541
Extraordinary Expenses (-)                     1,704              1,177
                                             -------            -------
Income Tax on Extraordinary Activity               -              2,927
                                             -------            -------
  Due                                              -              2,927
  Deferred                                         -                  -
                                             -------            -------
      Net Result From Extraordinary
       Activities (H)                         (1,229)             5,437
                                             -------            -------
Income Distribution to Partners
Net Income (Net Loss) for the Account
 Period (G)-(H)                              116,929            116,474
                                             =======            =======
Result of Operations Before Tax              175,839            175,136
                                             =======            =======



                           SEVEROCESKE TEPLARNY, a.s.
                               CASH FLOW STATEMENT
                      For the year ended 31 December 1999

                                                                                         12/31/99     12/31/98
                                                                                         --------     --------
                                                                                                 
Cash and Cash Equivalents at the Beginning of the Accounting Period (A)                   168,701       98,682
                                                                                          -------      -------
Profit/Loss From Normal Activity Before Taxes (B)                                         177,068      166,772
                                                                                          -------      -------
Adjustment by Non-Cash Transactions (C)                                                    90,194       63,904
                                                                                          -------      -------
  Depreciation of Fixed Assets                                                             84,881       79,302
  Change in Provisions, Reserves and Change in Prepayments and Accruals                    (5,240)     (11,467)
  (Profit) Loss From Sale of Fixed Assets                                                   4,887       (5,607)
  Dividends and Profit Revenues                                                                 -       (1,333)
  Interest Expense                                                                          5,666        3,009
                                                                                          -------      -------
Net Cash Flow From Operational Activity (B)+(C)=(D)                                       267,262      230,676
                                                                                          -------      -------
Change in Working Capital (E)                                                             (36,179)      42,328
                                                                                          -------      -------
  Change in Receivables From Operational Activities                                       (27,260)      30,148
  Change in Short-Term Payables From Operational Activities                               (20,988)      19,819
  Change in Inventories Balance                                                            12,069       (7,639)
                                                                                          -------      -------
Net Cash Flow From Oper. Activity Before Taxes (D)+(E)=(F)                                231,083      273,004
                                                                                          -------      -------
Interest Paid (G)                                                                         (12,907)     (24,485)
Interest Received (H)                                                                       6,656       21,408
Tax on Normal Activity and Additional Tax of Prior Years (I)                              (52,594)     (57,598)
Revenues and Expenses Related to Extraordinary Items (J)                                   (1,229)       8,364
                                                                                          -------      -------
  Net Cash Flow From Operational Activity (F)+(G)+(H)+(I)+(J)=(K)                         171,009      220,693
                                                                                          -------      -------
Fixed Asset Acquisition                                                                  (292,252)    (109,119)
Sale of Fixed Assets                                                                       15,639       14,652
Loans to Related Parties                                                                    5,155        2,578
                                                                                          -------      -------
  Net Cash Flow From Investment Activity (L)                                             (271,458)     (91,889)
                                                                                          -------      -------
Change in Long-Term and Short-Term Liabilities (M)                                           (805)        (805)
                                                                                          -------      -------
Impact of Changes in Equity (N)                                                           (53,280)     (59,313)
                                                                                          -------      -------
  Direct Payments Debited to Funds                                                         (1,657)      (1,694)
  Paid-out Dividends and Profit Shares                                                    (51,623)     (57,619)
                                                                                          -------      -------
Dividends and Profit Shares Received (O)                                                        -        1,333
                                                                                          -------      -------
  Net Cash Flow From Financial Activity (M)+(N)+(O)=(P)                                   (54,085)     (58,785)
                                                                                          -------      -------
Net Increase/Decrease in Cash (K)+(L)+(P)=(Q)                                            (154,534)      70,019
                                                                                          -------      -------
Cash and Cash Equivalents as the End of the Accounting Period (A)+(Q)                      14,167      168,701
                                                                                          =======      =======






EX-99
15
0015.txt
AUDITOR'S REPORT FOR TEPLARNA LIBEREC


                                                                  Exhibit I-2

                      Auditors report for shareholders of
                             Teplarna Liberec, a.s.



We have audited the financial statements of Teplarna Liberec,  a.s. for the year
ended  31  December  1999.  The  Board  of  Directors  is  responsible  for  the
preparation of the financial statements and for maintaining  accounting which is
complete,  supportable and correct.  Our responsibility is to express an opinion
on the financial  statements  taken as a whole,  based on our audit performed in
accordance  with the CNR Act no.  524/1992 Coll., on Auditors and the Chamber of
Auditors of the Czech Republic and the auditing guidelines issued by the Chamber
of Auditors.

The  auditing  guidelines  require  that we plan and perform the audit to obtain
reasonable  assurance  that  the  financial  statements  are  free  of  material
misstatements.  Our audit includes an examination of the evidence supporting the
financial  statements  with respect to the closed books of the company  wound up
without  liquidation in the  transformation.  Our audit also includes  assessing
whether  the  accounting  policies  used  and  significant   estimates  made  by
management are fair and suitable, as well as evaluating the overall presentation
of the financial  statements.  Our audit  procedures  were carried out on a test
basis and with regard to the principle of materiality. We believe that our audit
provides a reasonable basis for expressing our opinion.

In our  opinion,  the  financial  statements  present  fairly,  in all  material
aspects,  the assets,  liabilities,  equity and  financial  position of Teplarna
Liberec, a.s. as of 31 December 1999 and the financial results for the year then
ended in accordance with valid acts and relevant accounting legislation.

We have verified  whether the information  about the audited period for the past
period  contained  in the  annual  report  is in  conformity  with  the  audited
financial  statements.  In our  opinion,  this  information  is in all  material
respects is in conformity with the audited financial statements from which it is
taken.


Prague, March 24, 2000

Auditing company:                     Statutory auditor:

Consultas-Audit, s.r.o.               Jaroslav Suva
License number 87                     License number 234




                             TEPLARNA LIBEREC, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET
                                     ASSETS


                                            12/31/99           12/31/98
                                            --------           --------

                                                    (CZK 000's)

Total Assets                                 592,026            578,606
                                             =======            =======
Fixed Assets                                 389,073            381,946
                                             -------            -------
 Intangible Assets                               379                421
                                             -------            -------
  Software                                       316                347
  Patents, Copyrights, Trademarks,
   Tradenames                                     63                 74
                                             -------            -------
 Fixed (Tangible) Assets                     388,694            381,375
                                             -------            -------
  Land                                         7,137              7,070
  Plant (Buildings, Halls and Construction)  122,957            117,831
  Capital Equipment                          251,833            238,131
  Acquisition of Fixed Asset in Progress       5,930             13,476
  Deposits Towards Fixed Acquisitions            837              4,867
                                             -------            -------
 Investments (Financial Assets)                    -                150
                                             -------            -------
  Other Investments                                -                150
                                             -------            -------
Current Assets                               202,454            196,244
                                             -------            -------
  Inventory                                   59,944             66,198
                                             -------            -------
   Raw Materials                              59,944             66,198
   Merchandise                                     -                  -
                                             -------            -------
 Accounts Receivable                          63,324             63,324
                                             -------            -------
  Long-Term Receivables                          481                481
                                             -------            -------
    Trade and Other Receivables                  481                481
                                             -------            -------
  Short-Term Receivables                      62,398             62,843
                                             -------            -------
    Accounts Receivable                       56,387             60,797
    Receivable - Taxes                         5,758              1,959
    Other Accounts Receivable                    253                 87
                                             -------            -------
 Current Liquid Assets                        79,631             66,722
                                             -------            -------
  Petty Cash and Deposits in Transit             139                 97
  Cash in Bank                                 3,992             14,625
  Short-Term Assets                           75,500             52,000
                                             -------            -------
Other Assets - Temporary Debit Accounts          499                416
                                             -------            -------
 Accruals                                        198                315
                                             -------            -------
  Pre-Paid Expenses                               94                152
  Unbilled Revenue                               104                163
                                             -------            -------
 Contingencies and Estimate Pre-Paid Items
 (Debit Balance)                                 301                101






                             TEPLARNA LIBEREC, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET
                         LIABILITIES AND OWNER'S EQUITY


                                            12/31/99           12/31/98
                                            --------           --------
                                                    (CZK 000's)

Total Liabilities and Owner's Equity         592,026             578,606
                                             =======             =======
Owner's Equity                               532,149             529,542
                                             -------             -------
 Capital Stock at Par                        500,000             500,000
 Restricted Retained Earnings                  2,461               2,068
                                             -------             -------
  Statutory Reserve Account                    2,461               2,068
                                             -------             -------
 Retained Earnings                            26,731              19,626
 Net Income or Net Loss                        2,957               7,848
                                             -------             -------
External Sources (Of Money)                   57,329              40,156
                                             -------             -------
 Reserves                                     17,707              12,779
                                             -------             -------
  Tax Deductible Reserves                          -                   -
  Other Reserves                              17,707              12,779
                                             -------             -------
 Liabilities to Subsidiaries                       -               5,155
                                             -------             -------
 Current Liabilities                          39,622              22,222
                                             -------             -------
  Accounts Payable                            31,142              17,138
  Payroll Payable                                988               1,173
  Social Security Payable                      1,376               1,508
  Taxes Payable                                1,541                 407
  Deferred Taxes Payable                       3,121                 686
  Payable to Subsidiaries                          -                   -
  Other Payables                               1,454               1,310
                                             -------             -------
 Bank Loans                                        -                   -
                                             -------             -------
Other Liabilities and Equity - Closing
 Accounts                                      2,548               8,908
                                             -------             -------
 Accrual Accounts                                702               3,290
                                             -------             -------
  Accrued Expenses                               667               3,185
  Unearned Revenue                                35                 105
                                             -------             -------
 Contingencies and Estimated Accrued Items
 (Credit Balance)                              1,846               5,618





                             TEPLARNA LIBEREC, a.s.
                     FINANCIAL STATEMENTS - INCOME STATEMENT



                                            12/31/99           12/31/98
                                            --------           --------
                                                    (CZK 000's)


Revenue (From Sale of Merchandise)               154              3,052
 Cost of Goods Sold (Merchandise)                154              2,897
                                             -------            -------
 Gross Profit on Merchandise Sold (A)              -                155
                                             -------            -------
Revenue (From Sale of Manufactured
 Goods) (B)                                  564,409            589,927
                                             -------            -------
 Revenue (From Sale of Manufactured
  Goods and/or Services)                     564,355            589,848
 Self-Constructed Asset Revenue                   54                 79
                                             -------            -------
Cost of Materials Used in Manufacturing (C)  474,495            495,743
                                             -------            -------
 Raw Materials and Utilities Used            284,859            305,053
 Services Used                               189,636            190,690
                                             -------            -------
Gross Profit on Sales (A)+(B)-(C)             89,914             94,339
                                             -------            -------
Payroll                                       47,041             46,800
                                             -------            -------
 Wages and Salaries                           32,917             32,987
 Board Member Fees and Bonuses                   820                568
 Social Security Expenses                     11,449             11,445
 Fringe Benefits                               1,855              1,800
                                             -------            -------
Taxes and Fees                                    62                 33
Amortization of Intangible and
 Depreciation of Tangible Fixed Assets        29,900             27,992
Moneys Received From Sale of Fixed
 Assets and Raw Materials (+)                    152                503
Net Book Value of Disposed Fixed
 Assets or Raw Materials (-)                     354                331
Clearing of Reserves & Accrued Revenue (+)     4,779              3,854
Creation of Reserves & Accrued Expenses (-)    9,707             12,779
Clearing of Gains on Assets to Operating
 Revenue (+)                                     989              2,699
Clearing of Losses on Assets to Operating
 Expense (-)                                   2,950              2,215
Other Operating Gains (Revenues)(+)            4,408              2,870
Other Operating Expenses (-)                   9,721              3,860
                                             -------            -------
Operating Income (D)                             507             10,255
                                             -------            -------
Moneys Received From Sale of Securities
 Or Direct Investments (+)                         -                  -
Cost (Purchase Price) of Securities and
 Direct Investments Sold (-)                       -                  -
Gains on Investments (+)                           2                 38
Revenues from Short-Term Financial Assets (+)  3,715                 32
Interest Income (+)                            2,360             11,342
Interest Expense (-)                             161              1,015
Other Gains on Investments (+)                     -                  -
Other Expenses on Investments (-)                142              2,306
                                             -------            -------
Profit/loss From Financial Operations (E)      5,774              8,091
                                             -------            -------
Income Tax (F)                                 4,496              9,794
                                             -------            -------
 Payable                                       2,061              9,524
 Deferred                                      2,435                270
                                             -------            -------
Income From Operations (D)+(E)-(F)=(G)         1,785              8,552
                                             -------            -------
Unusual and/or Extraordinary Gain/Income (+)   1,355              1,089
Unusual and/or Extraordinary
 Loss/Expenses (-)                               183              1,793
                                             -------            -------
Unusual Profit/Loss (H)                        1,172               (704)
                                             -------            -------
Net Income/Loss for Fiscal Period (G)+(H)      2,957              7,848
                                             =======            =======
Income Before Tax                              7,453             17,642
                                             =======            =======



                                    CASH FLOW



                                                      12/31/99      12/31/98
                                                      --------      --------

Cash and Cash Equivalents at the Beginning
 of the Accounting Period (A)                           66,722        54,886
                                                       -------       -------
Profit/Loss From Normal Activity Before Taxes (B)        6,281        18,346
                                                       -------       -------
Adjustments by Non-Cash Transactions (C)                30,207        32,551
                                                       -------       -------
 Depreciation of Fixed Assets                           30,701        29,142
 Change in Provisions, Reserves and Change in
  Prepayments and Accruals                               1,449        13,777
  (Profit) Loss From Sale of Fixed Assets                  256           (41)
 Interest Expense                                       (2,199)      (10,327)
Net Cash Flow From Operational Activity Before
 Taxes and Before Changes in Working Capital and
                                                       -------       -------
 Extraordinary Items (B)+(C)=(D)                        36,488        50,897
                                                       -------       -------
Change in Working Capital (E)                           23,225       (15,533)
                                                       -------       -------
 Change in Receivables From Operational Activities       1,613        12,183
 Change in Short-Term Payables From Operational
  Activities                                            19,410       (33,202)
 Change in Inventories Balance                           5,428         5,486
                                                       -------       -------
Net Cash Flow From Operational Activity Before
 Taxes and Extraordinary Items (D)+(E)=(F)              59,713        35,364
                                                       -------       -------
Interest Paid (G)                                         (161)         (947)
Interest Received (H)                                    2,360        11,342
Tax on Normal Activity and Additional Tax of
 Prior Years (I)                                        (6,506)       (1,782)
Revenues and Expenses Related to Extraordinary
 Items (J)                                                 291          (704)
                                                       -------       -------
Net Cash Flow From Operational
 Activity (F)+(G)+(H)+(I)+(J)=(K)                       55,697        43,273
                                                       -------       -------
Fixed Asset Acquisition                                (37,363)      (28,840)
Sale of Fixed Assets                                        80           331
                                                       -------       -------
Net Cash Flow From Investment Activity (L)             (37,283)      (28,509)
                                                       -------       -------
Change in Long-Term and Short-Term Liabilities          (5,155)       (2,578)
Paid-Out Dividends and Profit Shares                      (350)         (350)
                                                       -------       -------
Net Cash Flow From Financial Activity (M)               (5,505)       (2,928)
                                                       -------       -------
Net Increase/Decrease in Cash (K)+(L)+(M)=(N)           12,909        11,836
                                                       -------       -------
Cash and Cash Equivalents at the End of the
 Accounting Period (A)+(N)                              79,631        66,722
                                                       =======       =======





EX-99
16
0016.txt
AUDITOR'S REPORT FOR PRVNI SEVEROZAPADNI


Auditor's Report

1.       AUDITED COMPANY
         ---------------

         Prvni severozapadni teplarenska
         stock corporation
         Komorany u Mostu
         Company Identification Number:  46708197

2.       PERIOD OF THE FINANCIAL STATEMENT
         ---------------------------------

         The  period of 1 January 1999 to 31 December 1999 was audited.

3.       SUBJECT AND PURPOSE OF THE AUDIT
         --------------------------------

         We audited 1999 financial statements and the 1999 Annual Report.

         The purpose of our audit is to find out:

         -    whether the data in the financial statements and the Annual Report
              give  a  true  and  fair  view  of  the  assets  and  liabilities,
              difference between the assets and liabilities,  financial position
              and results of the financial results;

         -    whether  the  accounting  records  are  maintained  in a complete,
              supportable and correct way;

         -    whether the annex to the financial statements includes information
              demonstrating  important events that occurred in the period of the
              financial  statement  date to the  compilation  of this report and
              information  on an  assumption  of an  indefinite  duration of the
              accounting unit if it is jeopardized in any manner.

         The  stocktaking  systems of tangible and intangible  fixed assets were
         examined as far as documentation of their results is concerned.  At the
         same  time,  the  stocktaking  process  itself  and the  system  of the
         stocktaking  organization  were  reviewed  through  a  direct  check of
         selected items.


4.       RESPONSIBILITY DEFINITION
         -------------------------

         The statutory body of the audited  company is  responsible  for keeping
         complete,  supportable and correct accounting  records.  The auditor is
         obliged to draw up a report based on the conducted audit and to express
         his opinion as to the company financial  statements.  The auditor shall
         verify information proving data in the financial statements.

         We conducted our audit in  accordance  with the Act on Auditors and the
         Chamber of Auditors of the Czech  Republic and the auditing  guidelines
         issued by the Chamber of Auditors.

         With regard to the nature of the financial  statements,  we planned and
         executed our audit to obtain  reasonable  assurance  about  whether the
         financial statements are free of material  misstatements whether caused
         by mistake, deliberately or on different grounds.

         The  audit  is  conducted  on a test  basis  and in  accordance  with a
         principle  of the  accounting  data  significance and is  focused  on a
         verification  of completeness  and conclusive  evidence of the data and
         information  in  the  financial  statements,  the  correctness  of  the
         financial  statement  operations and the  adequateness  of the  applied
         accounting  methods.  The auditor also reviews important  estimates and
         decisions of the accounting  unit management that have an impact on the
         financial statements and its whole presentation.

         Our audit  provides a reasonable  basis for our opinion  regarding  the
         financial statements.

5.       AUDITOR'S STATEMENT
         -------------------

         We have  undertaken an audit of the 1999  financial  statements and the
         1999  Annual  Report,  and the  found-out  data  allow  us to make  the
         following conclusion:

         In our opinion,  the financial  statements of the audited  company were
         drawn  up in the  prescribed  extent  and on the  basis  of data in the
         accounting that is kept in accordance with valid laws and regulations.

         The  audited  financial  statements,  in all their  essential  aspects,
         present fairly the assets, liabilities,  equity as to 31 December 1999,
         the financial  position and economic results of the company in the said
         period in  accordance  with the  relevant  legislation.  That is why we
         issue this statement

                       w i t h o u t     q u a l i f i c a t i o n s.

Most, March 24, 2000

Audited by:                  MK Audit, v.o.s.
                             auditor - license No. 113

                             Statutory auditor
                             Ing. Rudolf Mrnka









                                      PSZT
                                  BALANCE SHEET

                                                        12/31/1999           12/31/1998
                                                        ----------           ----------

                                                                   (CZK 000's)
                                                        ---------------------------------
                                                                        

Total Assets                                             5,369,011            5,033,764

         Stock Subscriptions
           Receivable                                            -                    -

         Intangible and Tangible
           Assets and Investments                        4,840,790            4,641,214

         Intangible Assets                                     325                  887
         Tangible Assets                                 4,840,339            4,640,207
         Financial Investment                                  126                  120

         Current Assets                                    441,740              390,574

         Inventory                                          69,124               56,244
         Long-term Receivables                                 175                  175
         Short-term Receivables                            166,633              296,402
         Financial Accounts                                205,808               37,753

         Other Assets                                       86,481                1,976

         Temporary Accounts of Assets                       86,274                1,930
         Contingencies - Gain                                  207                   46

Total Shareholders' Equity and
  Liabilities                                            5,369,011            5,033,764

         Shareholders' equity                            2,374,145            2,237,283

         Registered Capital                              1,006,309            1,006,309
         Capital Funds                                         169                  169
         Funds Created From Profit                         160,952              142,667
         Retained Earnings                               1,067,855              733,146
         Profit and Loss of
          Current Accounting Period                        138,860              354,992

         Liabilities                                     2,973,985            2,766,333

         Reserves                                           43,228               82,635
         Long-term Liabilities                                   -              300,000
         Short-term Liabilities                          1,334,833              787,774
         Bank Loans and Short-term
          Notes                                          1,595,924            1,595,924


     Other Liabilities -
         Temporary Accounts of
         Liabilities                                        20,881               30,148

         Accruals                                                -               22,544
         Contingencies-Loss                                 20,881                7,604









                                      PSZT
                            PROFIT AND LOSS STATEMENT

                                                                  12/31/1999                  12/31/1998
                                                                  ----------                  ----------

                                                                               (CZK 000's)
                                                                  --------------------------------------
                                                                                          

         Operation                                                2,247,940                      2,204,769
          Revenues from Finished Products
           and Services                                           2,247,192                      2,204,300
          Capitalization                                                748                            469
         Consumption from Operation                               1,446,426                      1,050,771

         Value Added                                                801,514                      1,153,998

         Personnel Expenses (-)                                     147,837                        151,416
         Taxes and Fees (-)                                           1,197                          1,076
         Amortization of Intangibles and
          Depreciation of Tangibles (-)                             244,136                        206,700
         Revenues from Intang. and Tang.
          Assets and Materials Sold (+)                              52,202                         58,519
         Net Book Value of Intangibles,
          Tangibles and Material Sold (-)                            43,045                         48,019
         Reversal of Reserves and Prepaid
          Expenses (+)                                               38,964                         86,916
         Creation of Reserves and Prepaid
          Expenses (-)                                                    -                         17,584
         Reversal of Provisions (+)                                     525                         15,237
         Creation of Provisions (-)                                   1,142                         10,577
         Other Operational Revenues (+)                                 100                          2,021
         Other Operational Expenses (-)                              65,977                        411,321

         Net Operating Results (A)                                  389,971                        469,998

         Reversal of Financial Reserves (+)                             443                         71,879
         Creation of Financial Reserves (-)                               -                       (115,115)
         Interest Revenues (+)                                       16,667                          4,227
         Interest Expenses (-)                                      187,462                        163,068
         Other Financial Revenues (+)                                 5,840                        130,811
         Other Financial Expenses (-)                                 1,136                        228,384

         Net Result from Financial
          Activities (B)                                           (165,648)                       (69,420)

         Income Taxes on Normal Activity (C)                         89,175                         45,988

         Net Result After Taxes from
          Normal Activities (A+B-C=D)                               135,148                        354,590

         Extraordinary Revenues (+)                                   4,010                          1,652
         Extraordinary Expenses (-)                                     298                          1,250
         Income Tax on Extraordinary
          Activity (-)                                                    -                              -

         Net Result from Extraordinary
          Activities (E)                                              3,712                            402

         Net Income (Net Loss) for the
          Accounting Period (D+E)                                   138,860                        354,992









                                      PSZT

                                    CASH FLOW

                                                         December 31, 1999
                                                         -----------------

Cash and Cash Equivalents at the Beginning
  of the Accounting Period (A)                              37,753,081.21

Profit/Loss from Normal Activity Before Taxes (B)          224,323,571.27

Adjustments by Non-cash Transactions (C)                   282,158,485.09
  Depreciation of Fixed Assets (+)                         244,573,431.95
  Change in Provisions, Reserves and Change in
    Prepayments and Accruals                              (132,591,434.06)
  (Profit) Loss from Sale of Fixed Assets (+/-)               (618,484.27)
  Interest Expense (+)                                     170,794,971.47

Net Cash Flow from Operational Activity Before
  Taxes and Before Changes in Working Capital
  and Extraordinary Items (B+C=D)                          506,482,056.36

Change in Working Capital (E)                               62,246,877.27
  Change in Receivables from Operational Activities (+/-)  135,445,814.90
  Change in Short-term Payables from Operational
    Activities (+/-)                                       (59,418,352.28)
  Change in Inventories Balance (+/-)                      (13,780,585.35)

Net Cash Flow from Operational Activity Before
  Taxes and Extraordinary Items (D+E=F)                    568,728,933.63

Interest Paid (-)                                         (187,462,063.82)
Interest Received (+)                                       16,667,092.35
Revenues and Expenses Related to Extraordinary Items         3,712,044.90

Net Cash Flow from Operational Activity (G)                401,646,007.06

Fixed Asset Acquisition                                   (444,103,271.88)
Sale of Fixed Assets                                           997,605.20
Net Cash Flow from Investment Activity (H)                (444,105,666.68)

Change in Long-term and Short-term Liabilities             211,513,400.00
Impact of Changes in Equity                                 (1,998,956.06)
  Direct Payments Debited to Funds (-)                      (1,818,956.06)
  Paid-out Dividends and Profit Shares (-)                    (180,000.00)
Dividends and Profit Shares Received (+)                                -

Net Cash Flow from Financial Activity (I)                  209,514,443.94

Net Increase/Decrease in Cash (G+H+I=J)                    168,054,784.32

Cash and Cash Equivalents at the End of the
  Accounting Period (A+J)                                  205,807,865.53





EX-99
17
0017.txt
AUDITOR'S REPORT OF TEPLARNA KROMERIZ




  Auditor's report on audit of financial statements of Teplarna Kromeriz, a.s.

     The  1999  financial  statements  of  Teplarna  Kromeriz,  a.s.,  with  its
registered  office at  Kromeriz,  Na Sadkach  3572,  were audited due to a legal
obligation to provide financial statements audited by an auditor.

     The  ordinary  financial  statements  prepared as to 31 December  1999 were
subject to the audit  pursuant  to Section 14  Subsections  1 and 2 of the Czech
National Council's Act No. 524/1992 Coll.

In our audit, we paid attention to:

- -    a checkout of the balance sheet continuity;

- -    a checkout  of linking of  balances  on  synthetic  accounts to the balance
     sheet and the profit and loss  statement.  This checkout was carried out in
     Microsoft Excel.  After balances of synthetic  accounts had been taken over
     and control statements had been made, no differences were found out.

- -    the system of accounting  procedures and internal audit in 1999 with regard
     to  methodological  and technical  approaches and the compliance with valid
     regulations,  particularly  with  the Act  563/1991  Coll.,  on  Accounting
     Procedures,  and with the ruling of the Federal  Ministry of Finance,  reg.
     No.  V/20-100/1992,  on Account  Classification  and Accounting methods for
     Entrepreneurs, as amended;

- -    a survey  of  balances  discovered  in the  Company's  accounting  as of 31
     December  1999 on accounts of the  Company's  assets and on accounts of its
     liabilities and shareholders' capital;

- -    an evaluation of events that occurred after the financial  statements  date
     and that could have an impact on our auditor's report.

     We conducted  our audit in  accordance  with the  guidelines  issued by the
Chamber  of  Auditors  of  the  Czech  Republic,  and/or  with  requirements  of
international  auditing  standards  ensuring  from  the  responsibility  of  the
Company's  statutory  bodies  for  keeping  complete,  supportable  and  correct
accounting  records,  and  from the  obligation  to have  data in the  financial
statements  audited on a test basis and using the  principles  of  significance.
Accounting documents related to accounting records were audited on a test basis.
No extraordinary survey of any assets was necessary.

     Based on the results of the applied auditing  methods,  we did not find out
any significant  errors or discrepancies  with valid laws and  regulations.  The
carried-out audit entitles us reasonably to issue this statement:

     In our opinion, the financial  statements,  in all their essential aspects,
present  fairly the assets,  liabilities,  equity and the financial  position of
Teplarna Kromeriz, a.s., as to 31 December 1999, and its economic results in the
accounting  period  1999 in  accordance  with  the Act No.  563/1991  Coll.,  on
Accounting, and with respective regulations.


                                             Signature

Bystrice pod Hostynem, June 14, 2000

On behalf of Muller - audit, spol. s.r.o., license No. KACR 140

Ing. Jiri Muller, auditor, decree No. 527, the executive of the company







                            Profit and Loss Statement
                               In its full extent
                             As to December 31, 1999
                      (in whole thousands of Czech crowns)


                                                                   1999                      1998
                                                                   ----                      ----
                                                                                     

Income from sale of goods                                             -                        -
Costs expended on goods sold                                          -                        -
                                                                 ------                   ------
Trade margin                                                          -                        -

Performances                                                     44,215                   53,879
                                                                 ------                   ------
  Income from sale of own products and
    services                                                     44,215                   53,879

Output Consumption                                               42,153                   45,975
                                                                 ------                   ------
  Consumption of material and power                              33,836                   42,960
  Services                                                        8,317                    3,015
                                                                 ------                   ------
Value added                                                       2,062                    7,904

Personal expenses                                                 4,565                    4,997
                                                                 ------                   ------
  Wages expenses                                                  3,381                    3,692
  Expenditure on social security                                  1,184                    1,305

Taxes and payments (-)                                            1,128                       47

Deductions on intangible and tangible
  fixed assets (-)                                                1,444                    1,209
Income from sale of fixed assets and
  Materials (+)                                                       -                      130
Accounting of corrective items in
  operative yields (+)                                              129                      129

Accounting of corrective items in
  operative costs (-)                                                 -                        -
Other operative yields (+)                                           37                       47
Other operative costs (-)                                           126                      516
Operative economic result (A)                                    (5,035)                   1,441

Interest revenues (+)                                               156                      139
Interest expenses (-)                                               103                    1,290
Other financial revenues (+)                                          -                       29
Other financial expenses (-)                                        133                      145

Net result from financial activities (B)                            (80)                  (1,267)

Income taxes on normal activity                                       -                        -
    - due                                                             -                        -
    - deferred                                                        -                        -

Net result after taxes from normal activity
  (A+B =C)                                                       (5,115)                     174

Extraordinary revenues                                                -                      310
Extraordinary expenses                                                -                        -
Income tax on extraordinary activity                                  -                        -
    - due                                                             -                        -
    - deferred                                                        -                        -

Net result from extraordinary activities (D)                        310                      310

Net income (net loss) for the accounting
  Period (C + D)                                                 (5,115)                     484









                                  BALANCE SHEET
                               In its full extent
                             As of December 31, 1999
                      (in whole thousands of Czech crowns)


                                                                   1999                      1998
                                                                   ----                      ----
                                                                                     

ASSETS

Total Assets                                                     44,273                    43,782
                                                                 ======                    ======

  Intangible and Tangible Assets and
    Investments                                                  28,973                    30,288
                                                                 ------                    ------
    Intangible inv. Assets                                            6                         9

    Tangible assets                                              28,967                    30,279
                                                                 ------                    ------
      Land                                                        1,321                     1,321
      Buildings, halls and constructions                         15,228                    15,932
      Separate movable items and sets of
        mov. It.                                                  4,967                     5,704
      Incomplete tangible investments                             8,742                     8,742
      Corrective item for acquired property                      (1,291)                   (1,420)

Current Assets                                                   15,269                    13,464
                                                                 ------                    ------
    Trade Receivables                                            12,313                    10,824
    Receivables from Taxes and Subsidiaries                       1,186                     1,763
    Other Receivables                                                 5                        17
    Cash                                                            162                        74
    Bank Accounts                                                 1,560                       786
    Short-Term Financial Assets                                       -                         -

Other Assets                                                         31                        30
                                                                 ------                    ------
    Temporary Accounts of Assets                                     31                        27
    Contingencies - Gain                                              -                         3

TOTAL LIABILITIES AND CAPITAL                                    44,273                    43,782
                                                                 ======                    ======

  Own capital                                                      (542)                    4,573
                                                                 ------                    ------
    Basic capital                                                17,487                    17,487
    Capital funds                                                     -                         -
    Economic result of past years                               (12,914)                  (13,398)
    Economic result of current acc. period                       (5,115)                      484

  Liabilities                                                    44,734                    39,169
                                                                 ------                    ------
  Short-term liabilities                                         41,334                    35,544
                                                                 ------                    ------
      Trade payables                                              9,153                     7,357
      Payables to employees                                          82                       241
      Social security payable                                       310                       171
      Taxes payable                                                 115                        44
      Payables to related companies
        (shareholdings less than 50%)                            31,666                    27,729
      Other payables                                                  8                         2

    Bank loans and short-term notes                               3,400                     3,625
                                                                 ------                    ------
      Long-term bank loans                                        3,400                     3,625
      Short-term bank loans                                           -                         -

  Other liabilities - temporary accounts of
    liabilities                                                      81                        40
                                                                 ------                    ------
    Contingencies - loss                                             10                        40






                            Teplarna Kromeriz, a.s.
                              CASH FLOW STATEMENT
                      For the year ended 31 December 1999

                                                                            1999
                                                                            ----

                                                                   
Cash and cash equivalents at the beginning of the accounting period        860,136.04
                                                                         ------------
Cash flow from main (operational) activity

Profit/loss from normal activity before taxes                           (5,114,812.04)
                                                                         ------------

Adjustments by non-cash transactions                                     1,431,128.76
  Depreciation of fixed assets                                           1,444,104.30
  Change in provisions, reserves and change in
    prepayments and accruals                                                39,929.13
  (Profit) loss from sale of fixed assets                                           -
  Dividends and profit revenues                                                     -
  Interest Expense                                                         (52,904.67)

Net cash flow from operational activity before taxes and
  before changes in working capital and extraordinary items             (3,683,683.28)
                                                                         ------------

Change in working capital                                                4,497,840.94

  Change in receivables from operational activities                       (936,292.56)
  Change in short-term payables from operational activities              5,434,133.50
  Change in inventories balance                                                     -

Net cash flow from operational activity before taxes
  and extraordinary items                                                  814,157.66
                                                                        ------------

Interest paid                                                               28,528.54
Interest received                                                           38,444.13
Tax on normal activity and additional tax of prior years                    (4,352.00)
Revenues and expenses related to extraordinary items                        16,140.00

Net cash flow from operational activity                                    892,918.33
                                                                         ------------

Cash flow from investment activity

  Fixed asset acquisition                                                    6,612.16
  Sale of fixed assets                                                              -
  Loans to related parties                                                          -

Net cash flow from investment activity                                       6,612.16
                                                                         ------------
Cash flow from financial activity

Change in long-term and short-term liabilities                                      -

Impact of changes in equity                                                         -
  Capital and reserve fund increase                                                 -
  Refund of equity to shareholders                                                  -
  Monetary donations and subsidies to equity and other cash
    contributions of partners and shareholders                                      -
  Settling of loss by shareholders                                                  -
  Direct payments debited to funds                                                  -
  Paid-out dividends and profit shares                                              -

Dividends and profit shares received                                                -

Net cash flow from financial activity                                               -
                                                                         ------------

Net increase/decrease in cash                                              899,530.49
                                                                         ------------

Cash and cash equivalents at the end of the accounting period            1,759,666.53
                                                                         ------------

EX-99

                                    Duplicate

                                 Notarial record

written by me, JUDr.  Jaroslava  Mala of Most in m office at  Moskevska  1/14 in
Most this twenty-eighth day of September nineteen hundred and ninety-eight.

At the request of representatives of Prvni severozapadni teplarenska, a.s.. with
its registered  office in Komorany u Mostu, I have come to the stock corporation
in Komo0any u Mostu today where an extraordinary general meeting of this Company
took place.

I make the following

                                   attestation

regarding the course of deliberations of the Extraordinary General Meeting

1. The  deliberations of the  Extraordinary  General Meeting were opened by Ing.
Stefan  Pallay,  the Deputy  Chairman of the Board of Directors and the Managing
Director of the stock  corporation,  at 10:15 a.m.  He stated that  shareholders
owning 96.22 % of the Company's registered capital were present at the moment of
opening the Extraordinary  General Meeting,  according to the information of the
employees  authorized to tend the  attendance  list. The  Extraordinary  General
Meeting had, thus, a quorum.  Then he introduced  members of the Company's Board
of Directors and the Supervisory  Board. He also stated that the announcement of
the  Extraordinary  General  Meeting with its agenda was  published  pursuant to
Section 184  Subsections 4 and 5 of the  Commercial  Code and Article 20 para. 5
and 6 in national wide daily  newspapers,  namely in  Hospodarske  noviny and in
Mlada fronta Dnes and in the Commercial Bulletin on 26 August 1998. The decisive
day with regard to the attendance at the  Extraordinary  General  Meeting was 21
September 1998. The announcement of the Extraordinary  General Meeting contained
information  that the  shareholders  may study the  merger  documents  listed in
Section 69a  Subsection 7 of the  Commercial  Code, in the Company's  registered
office from 26 August 1998 till the  Extraordinary  General  Meeting on business
days from 10 a m. to 2 p.m..

The merger  project  prepared by the Boards of Directors  of both  participating
companies  (Prvni  severozapadni  teplarenska,  a.s., and Severoceske  teplarny,
a.s.) was published  pursuant to Section 69a Subsection 3 and Section 769 of the
Commercial  Code and Article 59 para.  1 of the Articles of  Association  in the
Commercial  Bulletin  and  pursuant  to Article 59 para.  1 of the  Articles  of
Association in Hospodarske noviny and Mlada fronta Dnes on 26August 1998.

The draft  resolution  of the  Extraordinary  General  Meeting on the merger was
published  pursuant  to  Section  220a  Subsection  9 and  Section  769  of  the
Commercial  Code and  Article 59 para 1 of the  Articles of  Association  in the
Commercial  Bulletin on 26August  1998 and  pursuant to Article 59 para 1 of the
Articles of Association in Hospodarske  noviny and Mlada fronta Dnes on the same
day.

The draft resolution of the Extraordinary  General Meeting that was to decide on
the merger was sent to all known  creditors  of the Company  pursuant to Section
220a para 9 of the Commercial Code on 26 August 1998.






                                     Page 2

The draft  resolution  was sent to 59 creditors of the Company as a hand-to-hand
delivery  by  registered  mail.  None of the  creditors  exercised  his right to
require  a  sufficient  security  of  his  receivables  as to  the  day  of  the
Extraordinary General Meeting.

Then Ing.  Stefan  Pallay  presented  the  agenda of the  Extraordinary  General
Meeting:

 1.      Approval of the Rules of Procedure and Voting,
 2.      Election of a Chairman, Deputy Chairman of the General Meeting, minutes
         clerks, minutes verifiers and vote counters,
 3.      Board of Directors' report on the extraordinary  financial statement as
         of 3O June 1998,
 4.      Supervisory  Board's report on a review of the extraordinary  financial
         statement,
 5.      Approval  of  the  extraordinary  financial  statement  reviewed  by an
         author,
 6.      Board of  Directors'  report  on the  project  of the  merger  of Prvni
         severozapadni teplarenska, a.s. and Severoceske teplarny, as,
 7.      Supervisory  Board's  report on the  result  of a  control  of the work
         related to the merger,
 8.      Decision on the merger of Prvni  severozapadni  teplarenska,  a.s.  and
         Severoceske  teplarny,  a.s. in accordance  with the merger  project of
         both companies,
 9.      Decision on changes in the Articles of Association,
10.      Election of members of the Board of Directors,
11.      Recall and election of Supervisory Board members elected by the General
         Meeting.

The first item on the  agenda  was an  approval  of the Rules of  Procedure  and
Voting at the General  Meeting  that is  enclosed  hereto as  Attachment  1. The
shareholders  received this document upon signing the  shareholders'  attendance
list.

Then the  Extraordinary  General  Meeting  voted on the Rules of  Procedure  and
Voting,  using the voting slip marked as the 1st voting  block After the voting,
Ing. Pallay said that the Rules of Procedure and Voting were approved  according
to the written statement of the vote counters.

Shareholders  having  968,297  shares,  i.e. 100 % shares present at the General
Meeting  supported the motion,  no  shareholder,  i.e. 0% shares  present at the
General Meeting,  voted against the motion,  0 share,  i.e. 0% shares present at
the General Meeting, abstained from voting,

The General  Meeting  approved  the Rules of  Procedure  and Voting  enclosed as
Attachment 1 hereto

2. The second  item on the agenda was an  election o the  Extraordinary  General
Meeting's  bodies.  Ing. Stefan Pallay submitted the following  proposals for an
election of the General Meeting's bodies:  The nominee for the General Meeting's
Chairman was Ing. Lubos Jarolimek,  the nominee for the General Meeting's Deputy
Chairman  was Ing.  Stefan  Pallay,  the  nominees  for minutes  clerks were Ms.
Nadezda  Ruzkova and Ing.  Jaroslav  Prusa,  the nominees for vote counters were
Ing.  Milan Ficek and Ing.  Antonin  Chladek,  the nominees for verifiers of the
minutes were Ing. Ales Novak and Ing. Frantisek Pracny.4

Then the General Meeting took the vote on the submitted motions using the voting
slip marked as the 2nd voting block

After the  voting,  Ing.  Pallay said that  according  to the report of the vote
counters,  Ing.Lubos  Jarolimek  had been  elected  the  Chairman of the General
Meeting.  Shareholders  having 968,297  shares,  i.e. 100% shares present at the
General Meeting,  supported him as a nominee.  No  shareholders,  i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, i.e.
0% shares present at the General Meeting, did not vote

Ing.  Stefan  Pallay was  elected the Deputy  Chairman  of the General  Meeting.
Shareholders  having  968,297  shares,  i.e. 100% shares  present at the General
Meeting, supported him as a nominee. No shareholders,  i.e. 0% shares present at
the General Meeting, voted against this motion, no shareholders,  i.e. 0% shares
present at the General Meeting,  abstained from voting, 0 shares, i.e. 0% shares
present at the General Meeting, did not vote






                                     Page 3

Mrs.  Nadezda  Ruzkova and Ing.  Jaroslav Prusa a were elected minutes clerks of
the Extraordinary General Meeting. Shareholders having 968,297 shares, i.e. 100%
shares  present  at  the  General  Meeting,   supported  them  as  nominees.  No
shareholders,  i.e. 0% shares present at the General Meeting, voted against this
motion,  no  shareholders,  i.e.  0%  shares  present  at the  General  Meeting,
abstained from voting, 0 shares,  i.e. 0% shares present at the General Meeting,
did not vote.

Ing.  Milan Ficek and Ing.  Antonin  Chladek were  elected vote  counters of the
General Meeting. Shareholders having 968,297 shares, i.e. 100% shares present at
the General Meeting, supported them as nominees. No shareholders, i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, i.e.
0% shares present at the General Meeting, did not vote.

Ing. Alesg Novak and Ing Frantisek Pracny were elected  verifiers of the General
Meeting minutes. Shareholders having 968,297 shares, i.e. 100% shares present at
the General  Meeting,  supported  them as nominees.  No  shareholders,  i. e. 0%
shares  present  at  the  General  Meeting,   voted  against  this  motion,   no
shareholders,  i.e. 0% shares  present at the General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote.

3. Ing.  Lubos  Jarolimek,  the elected  Chairman of the  Extraordinary  General
Meeting, started to conduct the deliberations of the General Meeting. He thanked
for the vote of confidence and invited Ing.  Stefan Pallay,  the Deputy Chairman
of the  General  Meeting,  to  present  the  Board of  Directors'  report on the
extraordinary  financial statements as to 30 June 1998, i.e. for the period of 1
January 1998 to 30 June 1998, including the auditor's report.

Ing. Pallay stated among others that the extraordinary  financial statements had
been prepared  pursuant to Section 69a Subsection 7 of the  Commercial  Code and
they had to give a true and fair view of the assets and  liabilities,  financial
position and economic results as to 3OJune 1998

The  auditor  of  MK  Audit,   v.o.s.,   issued  his  statement   regarding  the
extraordinary financial statements "without reservation " on 29 July 1998

The Board of Directors' report recommended the Extraordinary  General Meeting to
approve the extraordinary financial statements as of 30 June 1998.

4. After Ing. Pallay had presented the report, the Chairman of the Extraordinary
General  Meeting asked Ing.  Frantisek  Pracny,  the Chairman of the Supervisory
Board,  to  present  the   Supervisory   Board's  report  on  a  review  of  the
extraordinary  financial  statements  as of 30  June  1998.  According  to  Ing.
Pracny's  report,  the Supervisory  Board reviewed the  extraordinary  financial
statements  for the period of 1 January 1998 to 30 June 1998 and was  acquainted
with the auditor's  statement  "without  reservation  ". He also stated that the
audited  extraordinary  financial statements as of 30 June 1998, i.e. accounting
records and evidence,  were kept in a supportable way and in accordance with the
relevant  laws  and  generally  binding   regulations.   The  Supervisory  Board
recommended  the  Extraordinary  General  Meeting to approve  the  extraordinary
financial statements as of 30 June 1998.

5. The fifth item on the agenda was an  approval  of the  audited  extraordinary
financial statements. The Extraordinary General Meeting voted on this item using
the voting slip marked as the 3rd voting block.

After the voting,  Ing.  Stefan Pallay stated that the  extraordinary  financial
statements  of the Company  were  approved  according  to the report of the vote
counters, as shareholders having 968,297 shares, i.e. 100% shares present at the
General  Meeting,   supported  the  extraordinary   financial   statements.   No
shareholder,  i.e. 0% shares present at the General Meeting,  voted against this
motion, no shareholder, i.e. 0% shares present at the General Meeting, abstained
from voting, 0 shares,  i.e. 0% shares present at the General  Meeting,  did not
vote.

6. The  sixth  item on the  agenda  was the  Board of  Directors'  report on the
project of the merger of Prvni severozapadni teplarenska,  a.s., and Severoceske
teplarny,  a.s. The report was  presented by Ing.  Stefan  Pallay who said among
others that the merger project contains a number of fundamental and crucial data
regarding the  participating  companies'  identification  (business name,  legal
form,  registered office,  Company  Identification  Number,  registered capital,
number of shares), as well as a






                                     Page 4

valuation of the property and liabilities of the Company (property value,  value
of liabilities, net trade capital) and other substantial data, in particular:

a)       Determination of the exchange rate, value of shares and exchange ratio:
         the exchange  ratio of the value of the successor  company share to the
         value of the share of the company to be wound-up, while the rounded-off
         ratio of the values equals 1:0,8. Thus, the shareholders of Severoceske
         teplarny,  a.s., will become shareholders of the legal successor,  i.e.
         Prvni  severozapadni  teplarenska,  a.s.,  and they all  receive  eight
         shares of Prvni  severozapadni  teplarenska,  a.s.,  having the nominal
         value of 100 CZK for each share of Severoceske  teplarny,  a.s., having
         the nominal value of 1,000 CZK,  without undue delay after  Severoceske
         teplarny,  a.s., the wound-up  company,  is deleted from the Commercial
         Register.

b)       The value of the net  trade  capital  of  Severoceske  teplarny,  a.s.,
         falling to shares of Severoceske  teplarny,  a.s., which are subject to
         the share  exchange,  amounts  to  1,834,993,000  CZK  according  to an
         expert's opinion, while the shareholders of Severoceske teplarny, a.s.,
         receive shares of Prvni severozapadni teplarenska,  a.s., the successor
         company, having the total nominal value of 906,623,200 CZK.

c)       The equity of  Severoceske  teplarny,  a.s.,  is  transferred  to Prvni
         severozapadni  teplarenskai,  a.s.,  with  which this  company  will be
         merged.

d)       The registered capital of Prvni severozapadni teplarenska,  a.s., which
         amounted to 1,006,309,  000 CZK before the merger, will be increased by
         906,623,200 CZK due to the merger.  The registered  capital will amount
         to 1,912,932,200 CZK after the merger.

e)       The registered capital of Prvni severozapadni  teplarenska,  a.s., will
         be divided into  1,006,309  shares,  having the nominal  value of 1,000
         CZK, after the merger. Each share having the nominal value of 1,000 CZK
         will be  connected  with ten votes and each share  having  the  nominal
         value of 100 CZK will be connected with one vote.

f)       Reserves  created  by the  dissolved  company  shall not be  charged in
         revenues,  but they  shall  be  posted  in the  value  recorded  in the
         accounting as to the date of the  winding-up  in the  accounting of the
         successor company.

g)       The company to be dissolved shall be wound-up by the General  Meeting's
         decision as to the date of the General Meeting.  31 December 1998 shall
         be  proposed  as the day of  recording  the  merger  in the  Commercial
         Register.  Unless  the  merger  is  recorded  as to that  day,  another
         possible day of recording  the merger shall be the last calendar day of
         each  following  month.  The  day  of  recording  the  changes  in  the
         Commercial Register shall be the merger day.

h)       The number of the Board of Directors'  members in the successor company
         shall increase to ten members,  this provision  shall be in effect from
         the merger day. The number of the  Supervisory  Board's  members in the
         successor company shall increase to five members;  this provision shall
         be in effect from the merger day.

Further  he said among  others  that the  project  of the merger of  Severoceske
teplary,  a.s., and Prvni  severozapadni  teplarenska,  a.s., had been published
together  with the draft  resolution  of the  Extraordinary  General  Meeting in
Hospodarske  noviny  and  Mlada  fronta  Dnes on 26  August  1998.  It was  also
published in the Commercial Bulletin on the same day.

Finally,  Ing.  Stefan  Pallay  said  that  the  Board  of  Directors  of  Prvni
severozapadni teplarenska a.s., recommended to the Extraordinary General Meeting
on the basis of the submitted  merger project  (Attachment No. 2 hereof) and the
draft resolution of the Extraordinary  General Meeting, to approve the merger of
Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,  a.s., in the
extent  and under the  conditions  set in the  merger  project  and in the draft
resolution of the Extraordinary  General Meeting  concerning the merger of these
stock corporations (Attachment No. 3 here of).

7. The Chairman of the Extraordinary General Meeting asked Ing. Frantisek Pracny
to present  the  Supervisory  Board's  report on the results of a control of the
work related to the merger of the companies.  Ing.  Frantisek Pracny stated that
the Ordinary  General  Meeting held on 24 June 1998 had ordered the  Supervisory
Board to control the work  related to the merger of the  companies on an ongoing
basis within its task to review the Board of Directors' competency  performance.
It was to present its results to the General  Meeting that should  decide on the
merger of both companies.  The Supervisory  Board discussed the published merger
project and opinions of independent experts on






                                     Page 5

whose basis the project had been prepared. The Supervisory Board stated that the
expert's  opinions had been prepared by qualified  and duly licensed  experts in
compliance with the valid legal rules.

The Supervisory Board  recommended the Extraordinary  General Meeting to approve
the merger of Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,
a.s.

8.  Then  the  Extraordinary  General  Meeting  voted  on the  merger  of  Prvni
severozapadni  teplarenska a.s., and Severoceske  teplarny,  a.s., in accordance
with the  merger  project  and the draft  resolution  presented  by the Board of
Directors.

It voted using the voting slip marked as the 4th voting block.

After the voting, the Chairman of the Extraordinary  General Meeting stated that
the draft resolution of the  Extraordinary  General Meeting regarding the merger
of Prvni severozapadni  teplarenska,  a.s., and Severoceske teplarny,  a.s., had
been  approved as proposed by the Board of Directors  according to the report of
the vote counters,  because shareholders having 968,297 shares, i.e. 100% shares
present at the General Meeting,  supported this motion. No shareholder,  i.e. 0%
shares  present  at  the  General  Meeting,   voted  against  this  motion,   no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote.

9. The Chairman of the Extraordinary General Meeting presented item No. 9, which
is an approval of changes in the Articles of Association of the Company. He said
that the  shareholders  had  received  the  comprehensive  draft  changes in the
Articles of Association in writing and the present  Articles of Association upon
signing the  attendance  list. On these grounds the draft changes were not read.
The Extraordinary  General Meeting voted on the changes that are attached hereto
as Attachment No. 4. It used the voting slip marked as the voting block..

After the voting, the Chairman of the Extraordinary  General Meeting stated that
the changes in the Articles of  Association  had been approved  according to the
report of the vote counters as shareholders  having 968,297  shares,  i. e. 100%
shares present at the General  Meeting,  supported this motion.  No shareholder,
i.e. 0% shares  present at the General  Meeting,  voted against this motion,  no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote

10.  The tenth item on the agenda  was an  election  of the Board of  Directors'
members.  The Chairman of the Extraordinary  General Meeting said that the Board
of Directors held on 30 July 1998 had discussed Ing. J Vladimir Prerad's written
request as of 26 June 1998 regarding his resignation from the Board of Directors
of Prvni severozapadni  teplarenska a.s. The Board of Directors decided that the
office performance.  of Ing. Vladimir Prerad would terminate on the day on which
his  resignation  would be discussed by the Board of Directors,  i.e. on 30 July
1998.  The Board of Directors  appointed no substitute  member.  It proposed the
Extraordinary General Meeting to elect Mr. Ronald James Tanski, born on 5 August
1952, residing at 99 Deerhurst Park Boulevard, Kenmore, New York 14217, the USA,
as the  eighth  Board  member.  Mr.  Tanski  was  asked  if he  agreed  with his
candidacy, and he agreed.

Then the Chairman of the Extraordinary General Meeting said that other two Board
members  had to be  elected  with  regard  to an  increased  number  of Board of
Directors' members (10 members) in the successor company. The Board of Directors
proposed the following  members with a deferred  effect,  i.e. as per the day on
which the  decision of the  Commercial  Court  regarding  changes in the company
record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register):

a)       Mr. Josef Vanzura, personal identification number: 430608/102, residing
         at Vysoka Pec, Pysna 4, Chomutov county,

b)       Ing.Emil Volkmann, personal identification number 360822/056,  residing
         at SNP 1863, Louny.

These two nominees  were asked if they agreed with their  candidacy to the Board
of  Directors.   Both  of  them  answered  that  they  agreed.   Afterwards  the
Extraordinary  General Meeting  started voting on the submitted  proposals using
the voting  slip  marked as the 6th voting  block;  where in the first  question
there was the name Ronald James  Tanski,  in the second  question  there was the
name of Josef Vanzura and at the third  question there was the name of lng. Emil
Volkmann






                                     Page 6

After the voting, the Chairman of the Extraordinary  General Meeting stated that
all the nominees were elected. Each of them was supported by shareholders having
968,297 shares, i.e. 100% shares present at the General Meeting. No shareholder,
i.e. 0% shares  present at the General  Meeting,  voted against this motion;  no
shareholder,  i.e. 0% shares  present at the  General  Meeting,  abstained  from
voting, 0 shares, i.e. 0% shares present at the General Meeting, did not vote

He also said that except for Mr. Ronald James  Tanski,  the other members of the
Board of Directors,  i.e. Mr. Josef Vanzura and Ing. Emil Volkmann, were elected
members of the Board of Directors with a deferred effect, i.e. as per the day on
which the  decision of the  Commercial  Court  regarding  changes in the company
record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register).

11.  The  eleventh  item on the  agenda  was a  recall  and an  election  of the
Supervisory Board's members elected by the General Meeting.

The Board of  Directors  proposed  the General  Meeting to recall Mr.  Stanislav
Kolar, born on 9 April 1963, residing at Vodickova 25, Prague 1, with a deferred
effect,  i.e.  as per the day on which  the  decision  of the  Commercial  Court
regarding  changes  in  the  company  record  (related  to  the  merger)  in the
Commercial Register would take effect.

Then the  General  Meeting  voted using the voting slip marked as the 7th voting
block

After the voting,  the Chairman of the General  Meeting  informed the  attending
shareholders that Mr. Stanislav Kolar was recalled from the Supervisory Board as
to the day on which the decision of the Commercial  Court  regarding  changes in
the company record (related to the merger) in the Commercial Register would take
effect.  His recall was supported by shareholders  having 968,297  shares,  i.e.
100% shares  present at the General  Meeting.  No  shareholders,  i.e. 0% shares
present at the General Meeting, voted against this motion, no shareholders, i.e.
0% shares present at the General Meeting,  abstained from voting, 0 shares, L e.
0% shares present at the General Meeting, did not vote.

12. The next item on the  agenda  was an  election  of the  Supervisory  Board's
members. The Chairman of the Extraordinary  General Meeting said that the number
of the Supervisory Board's members was increased to five members due to a change
in the Articles of Association. Three members had to be still elected, while one
of them should be elected by  employees  of the Company  pursuant to Section 200
Subsection  1 of the  Commercial  Code and Article 39 para 5 of the  Articles of
Association  after the decision of the Commercial Court regarding changes in the
company  record  (related to the merger) in the  Commercial  Register  will take
effect.

The Board of Directors  proposed the Extraordinary  General Meeting to elect two
nominees for the Supervisory Board's members with a deferred effect, i.e. as per
the day on which the decision of the Commercial  Court regarding  changes in the
company  record  (related to the merger) in the  Commercial  Register would take
effect  (deletion of the wound-up  company and entry of changes in the successor
company in the Commercial Register).

These nominees were:

Jaroslav Kubera personal  identification number:  470216/020,  residing at Petra
Bezruce 2656/17, Teplice, Jarmila Folprechtova,  personal identification number:
475901/120, residing at Letna 222, Mimon IV.

Both nominees were asked if they agreed with their candidacy. Since they agreed,
the  Extraordinary  General  Meeting  started  voting on this motion,  using the
voting slip marked as the 8th voting block,  where in the first  question  there
was the name of Jaroslav  Kubera and in the other question there was the name of
Jarmila  Folprechtova.  After the voting,  the  Chairman of the General  Meeting
informed the attending  shareholders  that both nominees were elected members of
the Supendsory Board. Each of them was supported by shareholders  having 968,297
shares, i.e. 100% shares present at the General Meeting.  No shareholders,  i.e.
0% shares  present  at the  General  Meeting,  voted  against  this  motion,  no
shareholders,  i.e. 0% shares  present at the General  Meeting,  abstained  from
voting, 0 shares,  i.e. 0% shares present at the General Meeting,  did not vote.
At the same time,  the  Extraordinary  General  Meeting  decided  that these two
nominees were elected with a deferred  effect,  i.e. as per the day on which the
decision of the Commercial Court regarding changes in the company






                                     Page 7

record  (related to the  merger) in the  Commercial  Register  would take effect
(deletion of the wound-up company and entry of changes in the successor  company
in the Commercial Register).

13. Thefollowing attachments are integral parts of this notarial record:
Attachment No. 1: Rules of Procedure and Voting of the General Meeting,
Attachment No. 2: Project of the merger of Severoceske teplarny, a.s.,
and Prvni severozapadni teplarenska, a.s., prepared pursuant to Section 69a
Subsection 3 of the Commercial Code,
Attachment No. 3: Draft resolution of the Extraordinary General Meeting,
presented by the Board of Directors and regarding the merger of Severoceske
teplarny, a.s., and Prvni severozapadni teplarenska, a.s.,
Attachment No. 4: Draft of changes in the Articles of Association,
Attachment No. 5: Expert's opinion No. 1542/1998 of the expert's ledger, as of
17 August 1998:
"Expert's Report pursuant to Section 69a Subsection 4 of the Commercial Code on
a Project of a Merger of Two Companies",
Attachment No. 6.- Expert's opinion No. 40/1998, as of 18 August 1998:
"Expert's  Report  pursuant to Section 69a Subsections 4 and 5 of the Commercial
Code on the Results of a Review of the Merger Project".

Since all the items on the agenda were  discussed,  the  Chairman of the General
Meeting finished the Extraordinary General Meeting at 11:20 am

I, the notary, wrote out this notarial record and signed it in my own hand.

         L.S.

                                                           Jaroslava Mala

                                   notary, in her own hand

EX-99

JUDr. Jaroslava Mala, notary seated in Most, Moskevska 1/14
- -----------------------------------------------------------
Page one
                                                               NZ 358/98
                                                                N 362/98








                                   Counterpart


Notarial Record


written by me, JUDr.  Jaroslava Mala, notary public seated in Most, in my office
at Moskevska 1/14 in Most,  September 28, 1998 (this  twenty-eight  of September
nineteen hundred and eighty nine).


At  the  request  of  the   representatives  of  Severoceske   teplarny,   stock
corporation,  seated  in  Most,  J.  Seiferta  2179,  I have  come  today to the
Company's registered office where an extraordinary general meeting of this stock
corporation was held,

I make the following

                                   attestation

regarding the course of deliberations of the Extraordinary General Meeting.

First:  The  deliberations  of the  Extraordinary  Meeting  were opened by Josef
Vanzura,  the Managing  Director and  Vice-Chairman of the Board of Directors at
2.15 p.m. In the beginning he  introduced  the members of the Board of Directors
and of the Supervisory Board of the stock corporation  attending the meeting. He
stated that the  Extraordinary  General  Meeting was convened in compliance with
the Commercial  Code and under the observance of other legal  requirements.  The
announcement of the  Extraordinary  General Meeting was published in Hospodarske
noviny and in  Commercial  Bulletin,  on September 21, 1998. As of this date the
excerpt of shareholders was executed and at the same time the Securities  Center
stopped  the  registration  of  trades  with  shares  until  the  date  when the
Extraordinary General Meeting was held.

Next,  he stated that the  Extraordinary  General  Meeting  was  attended by the
shareholders  having in total  89.7 per cent of shares  (seven  natural  persons
having shares of the total number of one thousand six hundred  forty-two  pieces
and eight legal  entities with the total number of 1,014,517  pieces of shares).
The Extraordinary General Meeting constituted a quorum.






Page two



Then Mr.  Vanzura  informed the  shareholders  attending  the meeting  about the
General Meeting's agenda:

 1.      Opening and control if the General Meeting constitutes a quorum,

 2.      Approval of the Rules of Procedure and Voting of the General Meeting,

 3.      Election of Chairman of the General Meeting, minute clerk, verifiers of
         the minutes and vote tellers,

 4.      Election of the member of the Board of directors,

 5.      Board of Directors'  report on the extraordinary  financial  statements
         prepared as of June, 30, 1998,

 6       Supervisory  Board's  report on the  examination  of the  extraordinary
         financial statements verified by the auditor,

 7.      Approval  of the  extraordinary  financial  statements  verified by the
         auditor,

 8.      Board of Directors'  report on the merger project  between  Severoceske
         teplarny, a.s. and Prvni severozapadni teplarenska, a.s.,

 9.      Supervisory  Board's report on the control results of the work progress
         in merging,

 10.     Resolution on the merger between Severoceske  teplarny,  a.s. and Prvni
         severozapadni  teplarenska  a.s., in compliance with the merger project
         of both companies,

 11.     Approval of the bonuses for the members of the Company's bodies,

 12.     Conclusion of the General Meeting.


Secondly:  The second item on the Agenda of the General Meeting was the approval
of the Rules of Procedure  and Voting of the General  Meeting and  therefore Mr.
Vanzura invited Ing.  Richtr to present the  information  about this document to
the General  Meeting.  Mr. Richtr stated that all  shareholders had received the
text of the Rules of  Procedure  and Voting  enclosed as Annex 1 of the Notarial
Record upon signing the attendance list. He-raised the question if everybody had
one copy available. Due to the fact that the reply was positive, the text of the
Rules      of       Procedure       and       Voting      was      not      read
again.

After voting results having been submitted in writing by the vote tellers,  Ing.
Richtr stated that the Rules of Procedure and Voting of the General Meeting were
approved.  Shareholders having 99.1457% of shares supported the motion,  0.8130%
shares voted against the motion and 0.0413 shares abstained from voting.

The General  Meeting  approved the Rules of Procedure  and Voting of the General
Meeting.

Then Ing. Jaroslav Richtr invited Mr. Josef Vanzura,  Managing Director, to take
the floor again.

Thirdly:  Mr. Josef Vanzura informed the General Meeting about the third item on
the Agenda that was the election of the General Meeting's  bodies.  The Board of
Directors  submitted  the  following  proposal  for an  election  of the General
Meetings  bodies:  The  nominee  for the  General  Meeting's  Chairman  was Ing.
Jaroslav  Richtr,  the nominee for minute clerk was Ing.  Hana  Tvrznikova,  the
nominees for verifiers of the





Page three



minutes were JUDr Vladimir  Janovsky and Alexandr Krista,  the nominees for vote
counters were Ms. Marie Zakova, Mr. Jaroslav Baxa and Ing. Vladislav Sliska. Due
to the fact that nobody  raised any  counter-offer,  the voting was performed by
acclamation.

After the written  results  about the voting  having been  submitted by the vote
tellers,  Ing.  Richtr  stated that the General  Meeting's  bodies were elected.
Shareholders having 9.9597% of shares supported the motion, no shareholder, i.e.
0.00% of shares  voted  against the  motion,  0.0403% of shares  abstained  from
voting.

The General Meeting elected the bodies of the General Meeting as follows:
Ing. Jaroslav Richtr, Chairman of the Extraordinary General Meeting
Minute clerk: Ing. Hana Tvrznikova
Verifiers of the minutes: JUDr Vladimir Janovsky, Mr. Alexandr Krista
Vote counters: Mr. Jaroslav Baxa, Ms. Marie Zakova and Ing. Vladislav Sliska
Afterwards Mr. Josef Vanzura, Managing director, took the floor.

Fourthly:  Ing.  Jaroslav  Richtr  started to conduct the  deliberations  of the
General  Meeting.  He  informed  the  shareholders  about the fourth item on the
Agenda that was the election of the member of the Board of Directors.  The Board
of Directors proposed Mr. Ales Novak,  identification No. 560814/0923,  residing
at U.S.A., 2905 SW Greenway Ave, Portland, Oregon 97201, for the nomination as a
member of the Board of  Directors.  Ing.  Richtr raised a question if anybody of
the shareholders attending the meeting had any comments.  Then he asked Mr. Ales
Novak if he agreed  with his  nomination.  He agreed  and  therefore  voting was
performed using the voting slips.

After the vote  counters'  written  notice about the voting  results having been
submitted,  Ing.  Richtr  stated that due to the fact that several  shareholders
used  voting slip No. 2, some of them used No. 3 and even  somebody  used voting
slip No. 4, the previous voting was cancelled  because the counting of votes had
not been stared yet.

A new voting will be performed  while the  shareholders  use now the voting slip
No. 5. After the written  notice of vote tellers about the voting,  Ing.  Richtr
stated,  that  Mr.  Ales  Novak  became  a member  of the  Board  of  Directors.
Shareholders having 99.1457% of shares supported the motion,  0.7901 % of shares
voted against the motion and 0.0572% of shares abstained from voting.

The  General  Meeting  approved  Ing.  Ales  Novak as a member  of the  Board of
Directors of Severoceske teplarny, a.s.

Fifthly:  Ing.  Jaroslav Richtr informed the General Meeting about the next item
on the agenda - i.e. the Board of Directors  report on  extraordinary  financial
statements prepared as of June 30, 1998.

Mr.  Josef  Vanzura,  Managing  Director,  was invited to present the  mentioned
report.

The  General  Meeting   acknowledged  the  Board  of  Directors  report  on  the
extraordinary financial statements prepared as of June 30, 1998.






Page four



Sixthly: The sixth item on the agenda of the General Meeting was the Supervisory
Board's report on the extraordinary financial statements.  Therefore Ing. Richtr
invited Ing. J.  Nechvatal,  Chairman of the  Supervisory  Board, to present the
report

The  General  Meeting  acknowledged  the  Board  of  Directors'  report  on  the
examination of the extraordinary  financial  statements  prepared as of June 30,
1998.

Seventhly:  The  seventh  item on the  agenda  of the  General  meeting  was the
approval of the extraordinary  financial statements verified by the auditor. The
shareholders voted using voting slip No. 6

After the voting Ing. Richtr announced  15-minute break, i.e. until 2.50 p.m. In
the course of the break counting of votes was performed.

After  15-minute  break Ing.  Richtr  continued.  He announced that based on the
written notice of the vote tellers, the extraordinary  financial statements were
approved.  Shareholders having 98.8090% of shares supported the motion,  1.1751%
of shares voted against the motion and 0.0158% of shares abstained.

The General Meeting approved the extraordinary  financial statements prepared as
of June 30,1998 verified by the auditor.

Eighthly:  Ing. Richtr stated that meanwhile the protest supra the  cancellation
of voting on item No. 4 was raised  Ing.  Richtr  gave the  explanation  to this
matter  and  stated  that  due to the  fact  that  voting  about  item No. 3 was
performed  through  the  acclamation,  voting  slip No. 3 should have been used.
Unfortunately, the commission found out that different slips were thrown into to
the box. Thus he gave the explanation regarding the protest above mentioned. The
protest was enclosed as Annex No. 6

The General  Meeting  acknowledged  the report on the results of  on-going-basis
follow-up of the work progress of merging carried out by the  Supervisory  Board
of  Severoceske  teplarny,  a.s.  on the  basis of the  resolution  taken by the
Ordinary General Meeting held June 25, 1998.

Then the eighth item on the agenda of the General Meeting was proceeded.  It was
the  Board  of  Directors'  report  on  the  merging  project  presented  by Mr.
Jarolimek,  Chairman  of the Board of  Directors.  He stated,  that the  General
Meeting  held in June of this  year,  apart  from the other  things,  ordered to
prepare the project on merging, a project in compliance with the SCT Articles of
Association  as well as with the law.  Therefore the Board of Directors  submits
this  project for the General  Meeting's  approval.  The copy of the project was
available to each  shareholder.  Then all the shareholders  were asked if all of
them were acquainted  with it. Ing.  Jaroslav Richtr took the floor. He informed
about the fact that two protests  regarding item No. 8 were raised. The protests
were enclosed as Annexes No. 7 and 8.

Ninthly: The ninth item on the agenda of the General Meeting was the Supervisory
Board's report  regarding the follow-up of the work progress in merging that was
presented by Ing. Nechvatal.






Page five


The General Meeting acknowledged the Supervisory Board's report on the following
up of the work progress of the merger.

Tenthly:  The tenth item on the agenda of the General Meeting was the resolution
on merging Severoceske teplarny, a.s. with Prvni severozapadni  teplarenska a.s.
in compliance with the merger project  between these two companies.  This report
was presented by Ing.  Richtr.  He informed the General  Meeting about the draft
resolution as published in Hospodarske noviny on August 26, 1998:

"1.      The Extraordinary General Meeting states that:
a)       in  compliance  with all legal  requirements  stated under  section 69a
         subsection 3 of the  Commercial  Code, the project on the merge between
         Severoceske teplarny, a.s. and Prvni severozapadni teplarenska a.s. was
         developed,  while the evaluation of the assets and  liabilities of both
         companies  participating  in merging is supported by expert's  opinions
         prepared by two experts for each participating company. Thee project on
         merging is enclosed to the Minutes of the General Meeting,

b)       the merger project was examined by two, on Severoceske  teplarny,  a.s.
         independent  experts,  that  pursuant to  provisions  under section 69a
         subsections  4 and 5 of  the  Commercial  Code,  prepared  the  written
         reports for the shareholders.  The reports reviewing the merger project
         are enclosed to the minutes of this General Meeting,

c)       in the  registered  seat of the Company  during all working days in the
         period  from  10:00 to 14:00  until the moment  when the  Extraordinary
         General Meeting was started,  each shareholder of Severoceske teplarny,
         a.s.  had the chance to go through  principal  materials of the merger,
         i.e. the project on merging, experts' report, as well as other document
         stated  under  the  provision  of  section  69a,  subsection  7 of  the
         Commercial Code in the given extent and specified  details,  manner and
         in the time stated thereof,

d)       the  draft   resolution  of  the   Extraordinary   General  Meeting  of
         Severoceske  teplarny,   a.s.  was  published  in  Commercial  Bulletin
         pursuant  to  section  220a,  subsection  9,  and  section  769  of the
         Commercial  Code and pursuant to Article  14.4.6 of the Articles of the
         Association  of  Severoceske  teplarny,  a.s.  it was  made  public  in
         Hospodarske noviny,

e)       pursuant to section  220a,  subsection 9 of the  Commercial  Code,  the
         draft  resolution  was  sent  to all  known  creditors  of  Severoceske
         teplarny, a.s.

2.       acknowledges,
a)       the report of  Severoceske  teplarny  Board of  Directors on the merger
         project,

b)       the report on the results of the  follow-up on an ongoing basis related
         to the work progress in merging that was carried out by the Supervisory
         Board of  Severoceske  teplarny,  a.s.  on the basis of the  resolution
         taken by the Ordinary General Meeting held June 25, 1998.

3.       approves
         the merger project in the version published in Commercial  Bulletin and
         in Hospodarske noviny,






Page six



4.       decides
         in compliance  with the  provision  under  section 69,  subsection  32,
         section 187 letter i) of the  Commercial  Code and  pursuant to Article
         7.1.  letter  k) of the  Articles  of the  Association  of  Severoceske
         teplarny, a.s. about the merger between the company of


Severoceske teplarny,  a.s. and the company of Prvni severozapadni  teplarenska,
a.s. under conditions and terms stated in an approved project on merging, that:

         a) the company of Severoceske teplarny,  a.s. shall be wound-up without
         liquidation  as  of  September  28,  1998  and  the  company  of  Prvni
         severozapadni teplarenska, as. shall become its legal successor,

         b)  the  shareholders  of  Severoceske  teplarny,   a.s.  shall  become
         shareholders  of the  legal  successor,  i.e.  of  Prvni  severozapadni
         teplarenska  a.s. and each one share of Severoceske  teplarny,  a.s. of
         the nominal value of CZK 1, 000 (in words:  one thousand  Czech crowns)
         will be  exchanged  for 8  pieces  of  shares  of  Prvni  severozapadni
         teplarenska,  a.s. of the nominal value CZK 100 (in words:  one hundred
         Czech  crowns)  without  undue delay after the deletion of the wound-up
         company of Severoceske teplarny, a.s. from the Commercial Register,

         c) the  value  of net  assets  (shareholders'  equity)  of  Severoceske
         teplarny,  a.s.,  falling to the shares of Severoceske  teplarny,  a.s.
         that  are a  subject-matter  of  the  exchange  of  shares,  represents
         according to expert's opinion CZK 1,834,993, 000 (in words: one billion
         eight hundred  thirty-four million nine hundred  ninety-three  thousand
         Czech  crowns)  while  the  shareholders  of the  company  dissolved  -
         Severoceske  teplarny,  a.s. - will receive the shares of the successor
         company of Prvni severozapadni  teplarenska,  a.s. of the total nominal
         value of CZK  906,623,200  (in words:  nine hundred and six million six
         hundred and twenty-three thousand two hundred Czech crowns).

         d) the assets of the company of Severoceske  teplarny,  a.s. shall pass
         to the Company of Prvni severozapadni teplarenska, a.s. with which this
         company is merging,

5.       orders
a)       the Board of Directors of Severoceske teplarny,  a.s., to submit in the
         coordination  with  the  Board  of  Directors  of  Prvni  severozapadni
         teplarenska,  a.s.,  the  petition  for  the  deletion  of  Severoceske
         teplarny a.s.,  the company to be merged,  as of December 31, 1998 from
         the Commercial Register. Provided the Regional Court in Usti nad Labem,
         due to any reason, shall not issue the resolution on the deletion as of
         this date,  the petition  includes the request for deleting the company
         as of the last date of any following  calendar  month but always on the
         same date when the  changes on Prvni  severozapadni  teplarenska  a.s.,
         with which the company is merging,  will be entered into the Commercial
         Register,

         b) the Board of Directors of Severoceske  teplarny,  a.s to continue in
         the  activities  necessary  for  a  due  transfer  of  all  rights  and
         obligations  related to  Severoceske  teplarny,  a.s. to the  successor
         company - Prvni severozapadni teplarenska, a.s,






Page seven

c)       the  Supervisory  Board of  Severoceske  teplarny,  a.s. to oversee the
         exercise of the powers of the Board of Directors on an ongoing basis in
         order that everything  would pass in compliance with the merger project
         and relevant  provisions of the  Commercial  Code and pursuant to other
         generally binding legal regulations."

After the draft having been read a number of comments,  proposals or  objections
was  raised  that were  enclosed  as  annexes  No. 9 - 20. In most  cases,  they
expressed  disagreement or protest against the merger, the shareholders  request
the share of net  shareholders'  equity.  Then the voting about the merger using
the voting slip No. 7 took the place.

After the  results  of voting  in  writing  having  been  submitted  by the vote
tellers,  the Chairman of the General  Meeting  announced that the resolution on
the  merger  between  Prvni  severozapadni  teplarenska,  a.s.  and  Severoceske
teplarny,  a.s. was approved.  Shareholders  having 98.6261% of shares supported
the  motion,  1.3719% of shares  voted  against the motion and 0.0020% of shares
abstained.


The General  meeting  approved the resolution on the  dissolution of Severoceske
teplarny,  a.s. and about its merger with Prvni  severozapadni  teplarenska a.s.


Eleventhly:  The  eleventh  item on the agenda of the  General  Meeting  was the
approval of bonuses for the Company's bodies.  This report was presented by Ing.
Jaroslav  Richtr.  The  bonuses  to  members  of  the  Board  of  Directors  and
Supervisory  Board were assessed in the monthly amount of CZK 60,000,  in words:
sixty  thousand  Czech  crowns  until  the date of  dissolution  of  Severoceske
teplarny,  a.s. and the Board of Directors was required to determine rules valid
for  the   payment   of   bonuses  to   individual   bodies'  of  the   company.

After the voting on voting slip no. 8 took place. After the results of voting in
writing having been  submitted by the vote tellers,  the Chairman of the General
Meeting announced that the bonuses for the members of the Board of Directors and
the  Supervisory  Board were approved.  Shareholders  having  98.7712% of shares
supported the motion, 1.0763% of shares voted against the motion and 0.1525 % of
shares abstained.


Twelfthly:  The  following  documents  were  enclosed as annexes to the Notarial
Record:

Annex No. 1 - Rules of Procedure and Voting of the General Meeting
Annex No. 2 - Project on merging Severoceske teplarny, a.s. with Prvni
              severozapadni teplarenska, a.s.
Annex No. 3 - Draft resolution of the Extraordinary General meeting of
              Severoceske teplarny, a.s.
Annex No. 4 - Expert's opinion pursuant section 69a, subsections 4 and 5 of the
              Commercial Code
Annex No. 5 - Expert's opinion pursuant section 69a, subsection 4 and 5 of the
              Commercial Code
Annex No. 6 - Protest against voting on item No. 4
Annexes No. 7,8 - Protest related to item No. 8






Page eight



Annexes No. 9 - 19 - Protests related to item No. 10
Annex No. 20 - Protest related to item No. 12

In the  conclusion  of the  General  Meeting,  Mr.  Jarolimek  had the floor and
announced to all who raised protests that individual  explanatory  letters would
be sent to them.

On the  grounds  that all items of the  General  Meeting-were  dealt  with,  Mr.
Jarolimek finished at 12.30 the deliberations.





I, the notory, wrote out this notarial record and signed it in my own hand



                                         L.S. JUDr Jaroslava Mala
                                                  notary, in her own hand

EX-99

This  resolution  became  legally  effective                     F  25787/98
on  December  9, 1999                                            --------- /633
Regional Court in Usti nad                                       LabemB 239/17
December 9, 1999

Regional Court in Usti nad Labem decided in the legal matter of the proposal for
recording the changes in the stock  corporation  of Severoceske  teplarny,  a.s.
with  the  registered  office  in  Most,  Seifertova  2179,  zip  code  434  01,
identification number 46 70 80 65 into the Commercial register as follows:

In the  Commercial  Register  kept with the Regional  Court in Usti nad Labem in
Section B, Insert number 239

                                is being recorded

The stock corporation Severoceske teplarny, a.s. which was merged with the stock
corporation Prvni  severozapadni  teplarenska a.s. with the registered office in
Komorany u Mostu,  identification number 46708197, on the basis of the decisions
of  Extraordinary  General  Meetings  held on  09/28/1998,  is deleted  from the
Commercial Register as of December 31, 1999.

Legal reason of the deletion: winding-up of the Company without liquidation with
                              the legal successor

Date of recording the changes: December 31, 1999


Advice:    An appeal against this  resolution may be lodged at the High Court in
           Prague,  through  this  Court,  within the period of 15 days from the
           delivery hereof.

Usti nad Labem, December 3, 1999
                                                      JUDr. Jana Souckova, s.s.
Witness: Vera Horakova
                   Round Seal: Regional Court, Usti nad Labem

EX-99

This resolution became legally effective on
July17, 2000
District Court in Usti nad Labem
on July 17, 2000


                                      COPY
                                                             F 14252/2000
                                                             -----------/ 1068
                                                             B 242/18

                               R e s o l u t i o n

The District Court in Usti nad Labem decided in the legal matter of the proposal
of the record of the change of company  Prvni  severozapadni  teplarenska  a.s.,
registered office Komorany u Mostu,  postal code 434 03, company ID number 46 70
81 97 as follows:

In the  Commercial  Register at the  District  Court in Usti nad Labem,  file B,
insert No,. 242

the Company name:          Prvni severozapadni teplarenska a.s.
Registered office:         Komorany u Mostu, postal code 434 03

                                    is erased

the Company name:    United Energy, a.s.
Registered Office:   Most - Komorany, land-registry No.: 2, postal code 434 03

                                   is recorded

Date of change record:, September 1, 2000

Advice:  An appeal can be filed against this resolution within fifteen days from
         its delivery to the High Court in Prague, by means of this court.


In Usti nad Labem                           July 13, 2000

                                                     JUDr. Jana Souckova, s.s.
                                                              judge

Responsible for correctness:        Vera Horakova

                                   round seal
                        District Court in Usti nad Labem






Hereby I verify that this photocopy  corresponds word for word with the original
of the document,  from which it was created,  consisting of 1 sheet of paper, in
which no changes,  amendments,  inserts or strikes were done, which could weaken
its credibility. This photocopy is complete and contains 1 sheet of paper

In Most, July 18, 2000

Miroslava Pavlova
authorized by JUDr. Jaroslava Mala, notary

round seal - JUDr. Jaroslava Mala, notary in Most

EX-99

 PROVINCE OF ALBERTA                )
                                    )
                                    )
                                    )
                                    )
                             TO WIT:)

I, ALYSON F. GOLDMAN, of the City of Calgary, in the Province of Alberta, a notary public in and for the Province of Alberta by royal authority duly appointed, do certify that the paper writings hereto annexed are true photostatic copies of documents produced and shown to me and purporting to be the CERTIFICATE and ARTICLES OF AMALGAMATION and REGISTRATION STATEMENT of NATIONAL FUEL EXPLORATION CORP. evidencing the amalgamation of NATIONAL FUEL EXPLORATION CORP. and TRI LINK RESOURCES LTD., dated June 16, 2000; issued under the Business Corporations Act (Alberta), the said copies having been compared by me with the said original documents, an act whereof being requested I have granted the same under my notarial form and seal of office to serve and avail as occasion shall or may require.

        IN TESTIMONY WHEREOF I have hereunto set my hand and affixed my notarial seal at the City of Calgary, this 27th day of July, 2000.

                                                                 /s/ ALYSON F. GOLDMAN                     
                                                                 A Notary Public in and for the Province
                                                                 of Alberta

                                                                 ALYSON F. GOLDMAN
                                                                 Barrister & Solicitor

CORPORATE ACCESS NUMBER:   208852533

Alberta

BUSINESS CORPORATIONS ACT

CERTIFICATE

OF

AMALGAMATION

NATIONAL FUEL EXPLORATION CORP.
IS THE RESULT OF AN AMALGAMATION FILED ON 2000/06/16.

REGISTRAR OF
CORPORATIONS

Articles of Amalgamation
For
NATIONAL FUEL EXPLORATION CORP.

Classes of Shares:                          THE CORPORATION IS AUTHORIZED TO ISSUE AN
                                            UNLMTED NUMBER OF COMMON SHARES
Restrictions on Share                       NO SHARES OF THE CORPORATION SHALL BE
Transfers:                                  TRANSFERRED WITHOUT THE PRIOR WRITTEN
                                            APPROVAL OF THE BOARD OF DIRECTORS

Number of Directors:
Minimum Number of
Directors:                                  1
Maximum Number of
Directors :                                 10
Restrictions on Business To:                NONE
Restrictions on Business
From:                                       NONE
Other Rules or Provisions:                  SEE SCHEDULE A




                                   Registration Authorized By: ALYSON F. GOLDMAN
                                                               SOLICITOR

SCHEDULE A

7.   Other rules or provisions, if any:

(a) The number of shareholders of the Corporation exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Corporation, were, while in that employment, and have continued after termination of that employment to be, shareholders of the Corporation, is limited to not more than fifty, two or more persons who are the joint registered owners of one or more shares being counted as one shareholder.

(b) Any invitation to the public to subscribe for any securities of the Corporation shall be prohibited.

(c) The directors may appoint from time to time one or more directors within the limits provided in the Business Corporations Act (Alberta).

(d) Meetings of the shareholders may be held at any place within Canada or the United States.

(e) The Corporation shall have a lien on the shares registered in the name of the shareholder or his legal representative for a debt of that shareholder to the Corporation.

Service Request Number:           2106629
Alberta Corporation Type:         Named Alberta Corporation
Legal Entity Name:                NATIONAL FUEL EXPLORATION CORP.
French Equivalent Name:
Nuans Report Number:
Nuans Report Date:
French Name Nuans Report
Number:
French Name Nuans Report Date:
REGISTERED ADDRESS
Street:                           1900,333 - 7 AVENUE SW
Legal Description:
City:                             CALGARY
Province:                         ALBERTA
Postal Code:                      T2P 2Zl
RECORDS ADDRESS
Street:
Legal Description:
City:
Province:
Postal Code:
ADDRESS FOR SERVICE BY
MAIL
Post Office Box:

City:
Province:
Postal Code:
Internet Mail ID:

Classes Of Shares and any
Maximum Number(within each        THE CORPORATION IS AUTHORIZED TO
CLASS):                           ISSUE AN UNLIMITED NUMBER OF COMMON
                                  SHARES

                                  NO SHARES OF THE CORPORATION SHALL
                                  BE TRANSFERRED WITHOUT THE PRIOR
Restrictions On Share Transfers:  WRITTEN APPROVAL OF THE BOARD
                                  OF DIRECTORS
Minimum Number Of Directors:      1
Maximum Number Of Directors:      10
Restrictions On Business To:      NONE
Restrictions On Business From:    NONE
Other Provisions:                 SEE SCHEDULE A
Professional Endorsement
Provided:

Directors Issue Shares In Series:
Future Dating Required:
Registration Date:                2000/06/16

Directors


Last Name:                        ACKERMAN
First Name:                       PHILIP
Middle Name:                      C.
Street / Box Number:              20 SOUTH NEADOW DRIVE
City:                             ORCHARD PARK
Province:                         NEW YORK
Postal Code:                      14127
Country:
Appointment Date:                 2000/06/16
Resident Canadian:
Named on Stat Dec:
Status:                           Active


Last Name:                        BURNS
First Name:                       GARY
Middle Name:                      W.
Street / Box Number:              BOX 719
City:                             BRAGG CREEK
Province:                         ALBERTA
Postal Code:                      TOL OKO
Country:
Appointment Date:                 2000/06/16
Resident Canadian:                Y
Named on Stat Dec:                Y
Status:                           Active


Last Name:                        GORUK
First Name:                       DENNIS
Middle Name:                      R.
Street / Box Number:              19 COACH GATE WAY SW
City:                             CALGARY
Province:                         ALBERTA
Postal Code:                      T3H 1L7
Country:
Appointment Date:                 2000/06/16
Resident Canadian:                Y
Named on Stat Dec:
Status:                           Active


Last Name:                        KENNEDY
First Name:                       BERNARD
Middle Name:                      J.
Street / Box Number:              33 RUSKIN ROAD
City:                             BUFFALO
Province:                         NEW YORK
Postal Code:                      14226
Country:
Appointment Date:                 2000/06/16
Resident Canadian:
Named on Stat Dec:
Status:                           Active

Amalgamating Corporation - Registered in Alberta

Corporate Access Number         Legal Entity Name

204196406                       TRI LINK RESOURCES LTD.
208777888                       NATIONAL FUEL EXPLORATION CORP.

Court Orders

Order Type Order Date Order Number Judicial District Termination Date


Attachments

Attachment Type                Microfilm Bar Code     Date Recorder
Other Rules or Provisions      Electronic             2000/06/16
Statutory Declaration          10000395000021664      2000/06/16

Registration Authorized By:    ALYSON F. GOLDMAN
                               SOLICITOR

Other Provisions.txt

SCHEDULE A

7.   Other rules or provisions, if any:

(a) The number of shareholders of the Corporation exclusive of persons who are in its employment and exclusive of persons who, having been formerly in the employment of the Corporation, were, while in that employment, and have continued after termination of that employment to be, shareholders of the Corporation, is limited to not more than fifty, two or more persons who are the joint- registered owners of one or more shares being counted as one shareholder.

(b) Any invitation to the public to subscribe for any securities of the Corporation shall be prohibited.

(c) The directors may appoint from time to time one or more directors within the limits provided in the Business Corporations Act (Alberta).

(d) Meetings of the shareholders may be held at any place within Canada or the United States.

(e) The Corporation shall have a lien on the shares registered in the name of the shareholder or his legal representative for a debt of that shareholder to the Corporation.

CANADA                   )IN THE MATTER OF THE AMALGAMATION
                         )PURSUANT TO
PROVINCE OF ALBERTA      )SECTION 178(2) OF THE BUSINESS
                         )CORPORITIONS ACT (ALBERTA) OF
TO WIT:                  )NATIONAL FUEL EXPLORATION CORP.
                         )AND TRI LINK RESOURCES LTD.

STATUTORY DECLARATION

        I, GARY W. BURNS, of Bragg Creek, Alberta, DO SOLEMNLY DECLARE THAT:

1. I am a proposed director NATIONAL FUEL EXPLORATION CORP. (the "Amalgamated Corporation"), a corporation proposed to be formed by the amalgamation of National Fuel Exploration Corp. and Tri Link Resources Ltd.

2. I have conducted such examination of the books and records of both amalgamating corporations as are necessary to enable me to make the statements herein set forth.

3. There are reasonable grounds for believing that:

           a.   the Amalgamated Corporation will be able to pay its liabilities as they become due; and>

           b.   the realizable value of the Amalgamated Corporation's assets will not be less than the aggregate of its
                 liabilities and stated capital of all classes.

4. There are reasonable grounds for believing that no creditor will be prejudiced by the amalgamation.

         AND I MAKE this solemn declaration conscientiously believing it to be true and knowing that it is of the same force and effect as if made under oath.

Calgary, in the Province of Alberta, this    )
16th day of June, 2000.                      )
                                             )
/s/ ANDREA L. WHYTE                          )   /s/ GARY W. BURNS
Notary Public in and for                         GARY W. BURNS
the Province of Alberta

ANDREA L. WHYTE
Student-at-Law

EX-3

BY-LAW NO. 1

a by-law relating generally
to the transaction of the
business and affairs of

NATIONAL FUEL EXPLORATION CORP.
(the "Corporation")

1  -  INTERPRETATION

1.1    Definitions - In this by-law and all other by-laws of the Corporation, unless the context requires otherwise:

(a) “the Act” means the Business Corporations Act (Alberta), or any statute which may be substituted therefore including the regulations made thereunder as amended from time to time;

(b) “articles” means the original or restated articles of incorporation, articles of amendment, articles of amalgamation, articles of arrangement, articles of continuance, articles of dissolution, articles of reorganization, articles of revival, -letters patent, supplementary letters patent, a special Act and any or let the instrument by which the Corporation is incorporated;

(c) "board" means the board of directors of the Corporation; and "director" means a member of the board;

(d) "meeting of shareholders" means an annual meeting of shareholders or a special meeting of shareholders;

(e) "non-business day" means Saturday, Sunday and any other day that is a holiday as defined in the Interpretation Act (Alberta);

(f) “person” includes an individual, sole proprietorship, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, body corporate, and a natural person in the capacity of trustee, executor, administrator, or other legal representative;

(g) "resident Canadian" means a Canadian citizen ordinarily resident in Canada or as otherwise defined in the Act;

(h) “unanimous shareholder agreement” means a written agreement among all the shareholders of the Corporation, or among all such shareholders and one or More persons who are not shareholders, or a written declaration by a person who is the beneficial owner of all the issued shares of the Corporation, that restricts, in whole or in part, the powers of the directors to manage or supervise the management of the business and affairs of the Corporation, as may be from time to time amended;

(i) words importing the singular number also include the plural and vice-versa; words importing a particular gender include all genders;

(j) all words used in this by-law and defined in the Act shall have the meanings given to such words in the Act or in the related Parts thereof.

1.2    Execution in Counterpart - Any articles, notice, resolution, requisition, statement or other document required or permitted to be executed by more than one person for the purposes of the Act may be executed in several documents of like form each of which is executed by one or more of such persons, and such documents, when duly executed by all persons required or permitted, as the case may be, to do so, shall be deemed to constitute one document for the purposes of the Act.

2  -  GENERAL BUSINESS

2.1   Registered Office - The registered office of the Corporation shall be in the municipality or geographical township within Alberta as the board may from time to time determine.

2.2   Seal - The Corporation may have a seal which shall be adopted and may be changed by the board.

2.3   Financial Year - The financial year of the Corporation shall be determined by the board from time to time.

2.4   Execution of Instruments - Deeds, transfers, assignments, contracts, obligations and other instruments shall be signed on behalf of the Corporation by two persons,

(a) one of whom holds the office of chairman of the board, president, managing director or vice-president or is a director, and

(b) the other of whom holds one of the said offices or the office of secretary, treasurer, assistant secretary or assistant treasurer or any other office created by by-law or by resolution of the board or is a director.

In addition, the board may from time to time direct the manner in which and the person or persons by whom any particular instrument or class of instruments may or shall be signed.

The secretary or any other officer or any director may sign certificates and similar instruments (other than share certificates) on the Corporation’s behalf with respect to any factual matters relating to the Corporation’s business and affairs, including certificates verifying copies of the articles, by-laws, resolutions and minutes of meetings of the Corporation.

2.5   Banking Arrangements - The banking business of the Corporation, or any part thereof, shall be transacted with such bank, trust company or other firm or body corporate as the board may designate, appoint or authorize from time to time and all such banking business, or any part thereof, shall be transacted on the Corporation’s behalf by such one or more officers or other persons as the board may designate, direct or authorize from time to time and to the extent thereby provided.

3 - BORROWING

3.1   Borrowing - Without limit to the powers of the board as provided in the Act, the board may from time to time on behalf of the Corporation:

(a) borrow money upon the credit of the Corporation;

(b) issue, reissue, sell or pledge debt obligations of the Corporation;

(c) to the extent permitted by the Act, give, directly or indirectly, financial assistance to any person by means of a loan, a guarantee or otherwise to secure the performance of an obligation; and

(d) mortgage, hypothecate, pledge or otherwise create a security interest in all or any property of the Corporation, owned or subsequently acquired, to secure any obligation of a Corporation.

3.2   Delegation - Subject to the, Act, the articles, the by-laws and any unanimous shareholder agreement, the board may from time to time delegate to a director, a committee of directors or an officer of the Corporation or such other person or persons so designated by the board all or any of the powers conferred on the board by section 3.1 or by the Act to such extent and in such manner as the board shall determine at the time of each such delegation.

4 - DIRECTORS

4.1   Duties of Directors - Subject to any unanimous shareholder agreement, the board shall manage or supervise the management of the business and affairs of the Corporation.

4.2   Qualifications of Directors - At least half of the directors on the board shall be resident Canadians but where the Corporation has only one director, that director shall be a resident Canadian. No person shall be elected or appointed a director if that person is less than 18 years of age, of unsound mind and has been so found by a court in Canada or elsewhere, isnot an individual, or has the status of bankrupt. A director need not hold shares issued by the Corporation.

4.3   Number of Directors - The board shall consist of such number of directors as shall be set out in the articles or as may from time to time be determined in accordance with the Act. Where the board is empowered by special resolution to determine the number of directors within a range set out in the articles:

(a) the directors may appoint additional directors provided that after such appointment the total number of directors would not be greater than one and one third times the number of directors required to have been elected at the last annual meeting nor greater than the maximum number set out above; and

(b) the number of directors to be elected at the annual meeting shall be the, number of directors last determined by the board.

4.4   Consent to Act - A person who is elected or appointed a director is not a director unless:

(a) he, was present at the meeting when he was elected or appointed and did not refuse to act as a director, or

(b) if he was not present at the meeting when he was elected or appointed,

           (i)   he consented to act as a director in writing before his election or appointment or within 10 days after it, or

          (ii)    he has acted as a director pursuant to the election or appointment.

4.5   Quorum - A majority of the number as determined from time to time in accordance with the Act shall constitute a quorum for the transaction of business. Where the Corporation has fewer than three directors, all directors must be present at any meeting to constitute a quorum for the transaction of business. Notwithstanding vacancies, a quorum of directors may exercise all the powers of the board.

4.6   Election and Term - Directors shall be elected by the shareholders at the first meeting of shareholders after the effective date of this by-law and at each succeeding annual meeting at which an election of directors is required and shall hold office until the next annual meeting of shareholders or, if elected for an expressly stated term, for a term expiring not later than the close of the third annual meeting of shareholders following the election. The number of directors to be elected at any such meeting shall be that number most recently determined in the manner referred to in section 4.3. The election need not be by ballot unless a ballot is demanded by any shareholder or required by the chairman in accordance with section 8.17. If an election of directors is not held at an annual meeting of shareholders at which such election is required, the incumbent directors shall continue in office until their successors are elected.

4.7    Removal of Directors - Subject to the provisions of the Act, the shareholders may, by ordinary resolution passed by a majority of the votes cast at a meeting of shareholders, remove any director and may at that meeting elect a qualified person in place of that director for the unexpired term of such director’s predecessor.

4.8    Ceasing- to Hold Office - A director may resign as director by delivering a written resignation to the Corporation and such resignation becomes effective at the time the resignation is received by the Corporation or the time specified in the resignation whichever is later, A director shall forthwith cease to hold office as a director should the director cease to be qualified in accordance with the Act. Any attempt to amend or terminate any unanimous shareholder agreement without written consent of all persons who are then directors of the Corporation shall constitute the immediately effective resignation of all such directors who have not so consented.

4.9    Vacancies - Subject to the Act, whenever the board has fewer than the number of members elected, the directors then in office, if constituting a quorum (and notwithstanding that the majority of such directors are not resident Canadians), may appoint a qualified person to the board to hold office for a term expiring at the close of the next annual meeting of shareholders. Whenever a vacancy shall occur on the board which results in the board not having a quorum, the remaining directors shall forthwith call a special meeting of shareholders to fill the vacancy. If the board falls to call such meeting or if there are no such directors then in office, any shareholder may call the meeting. Where the number or the minimum number of directors is increased any vacancy resulting from such increase shall be filled by election at a special meeting of shareholders.

4.10    Action by the Board - Subject to any unanimous shareholder agreement, the board shall exercise its powers by or pursuant to a by-law or resolution either passed at a meeting of directors at which a quorum is present and at which a majority of the directors present are resident Canadians or consented to by the signatures of all the directors then in office if constituting a quorum. Where a corporation has fewer than three directors, one of the directors present at a meeting of directors shall be a resident Canadian. Subject to the Act, the board may transact business at a meeting of directors where a majority of resident Canadian directors is not present if a resident Canadian director who is unable to be ’ present approves in writing or by telephone or other communications facilities the business transacted at the meeting, and a majority of resident Canadian directors would have been present had that director been present at the meeting. Where the Corporation has only one director, that director may constitute a meeting.

4.11    Action in Writing - A resolution in writing, signed by all the directors entitled to vote on that resolution at a meeting of directors or a committee of directors, is as valid as if it had been passed at a meeting of directors or a committee of directors.

4.12    Meetings by Telephone - Any director may participate in a meeting of the board by means of such telephone, electronic, or other communication facilities as permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously, if all the directors present at or participating in the meeting consent to the holding of meetings in such manner.

4.13   Place of Meetings - Meetings of the board may be held at the registered office of the Corporation or at any other place within or outside Alberta. 4.14    Calling of Meetings – Meetings of the board shall be held from time to time at such place, on such day and at such time as the board, the chairman of the board, the managing director, the president, the secretary or any two directors may determine.

4.15    Notice of Meetings - Notice of the time and place of each meeting of the board shall be given to each director not less than 48 hours before the time when the meeting is to be held and need not be in writing.

4.16    First Meeting of New Board - Provided a quorum of directors is present, each newly elected board may without notice hold its first meeting following the meeting of shareholders at which such board is elected.

4.17   Adjourned Meeting - Notice of an adjourned meeting of the directors is not required if the time and place of the adjourned meeting is announced at the original meeting.

4.18    Regular Meetings - The board may appoint a day or days in any month or months for regular meetings at a place and hour to be named. A copy of any resolution by the board fixing the time and place of regular meetings of the board shall be sent to each-i director forthwith after being passed, but no other, notice shall be required for any such regular meeting.

4.19    Votes to Govern - - At all meetings of the board any question shall be decided by a majority of the votes cast on the question and in the case, of an equality of votes the chairman of the meeting shall be entitled to a second or casting vote. Any question at a meeting of the board shall be decided by a show of hands unless a ballot is required or demanded.

4.20    Chairman and Secretary - The chairman of the board or, in the absence of the chairman, the president if a director or, in the, absence of the president, a vice-president who is a director shall be chairman of any meeting of the board. If none of the said officers is present, the directors present shall choose one of their number to be chairman. The secretary of the Corporation shall act as secretary at any meeting of the board and, if the secretary of the Corporation be absent, the chairman of the meeting shall appoint a person who need not be a director to art as secretary of the meeting.

4.21    Remuneration and Expenses - Subject to any unanimous shareholder agreement, the directors shall be paid such remuneration for their services as directors as the board may from time to time authorize. The directors shall also be entitled to be paid in respect of travelling and other expenses properly incurred by them in attending meetings of the board or any committee thereof or in otherwise serving the Corporation. Nothing herein contained shall preclude any director from serving the Corporation in any other capacity and receiving remuneration therefor.

4.22    Conflict of Interest - Subject to and in accordance with the provisions of the Act, a director or officer of the Corporation who is a party to a material contract or transaction or proposed material contract or transaction with the Corporation, or is a director or an officer of or has a material interest in, any person who is a party to a material contract or transaction or proposed material contract or transaction with the Corporation, shall disclose in writing to the Corporation or request to have entered in the minutes of meetings of directors the nature and extent of such interest, and my such director shall refrain from voting in respect thereof unless otherwise permitted by the Act.

5 - COMMITTEES

5.1    Committees of Directors - The board may appoint, from their number, a committee or committees of directors, however designated, and delegate to such committee or committees any of the powers of the board except powers to:

(a) submit to the shareholders any question or matter requiring the approval of the shareholders;

(b) fill a vacancy among the directors or in the office of auditor;

(c) issue securities except in the manner and on the terms authorized by the directors;

(d) declare dividends;

(e) purchase, redeem or otherwise acquire shares issued by the Corporation, except in the manner and on the terms authorized by the directors;

(f) pay a commission for the sale of shares of the Corporation;

(g) approve a management proxy circular;

(h) approve any annual financial statements; or

(i) adopt, amend or repeal by-laws.

At least half of the members of any such committee shall be resident Canadians.

5.2   Transaction of Business - The powers of a committee of directors may be exercised by a meeting at which a quorum is present or by resolution in writing signed by all the members of such committee who would have been entitled to vote on that resolution at a meeting of the committee. Meetings of such committee may be held at any place in or outside Alberta and, subject to the provisions of section 4.12 which shall be applicable mutatis mutandis, may be held by means of telephone or other communications equipment.

5.3   Procedure - Unless otherwise determined by the board, each committee shall have the power to fix its quorum at not less than a majority of its members, to elect its chairman and to regulate its procedure.

so appointed. The board may specify the duties of such officers and, in accordance with this bylaw and subject to the provisions of the Act, delegate to such officers powers to Manage the business and affairs of the Corporation other than any of the powers listed in section 5.1. Except for a managing director and a chairman of the board, an officer need not be a director and one person may hold more than one office. The president or such other officer as the board may designate shall be the chief executive officer of the Corporation.

6.2    Agents and Attorneys - The board shall have the power from time to time to appoint agents or attorneys for the Corporation in or out of Alberta with such powers of management or otherwise (including the power to sub-delegate) as the board may determine.

6.3    Conflict of Interest - An officer shall disclose an interest in any material contract or transaction or proposed material contract or transaction with the Corporation in accordance with section 4.22.

7 - PROTECTION OF DIRECTORS AND OFFICERS

7.1    Indemnity of Directors and Officers - Subject to section 119 of the Act, the Corporation shall indemnify a director or officer of the Corporation, a former director or officer of the Corporation or a person who acts or acted at the Corporation’s request as a director or officer of a body corporate of which the Corporation is or was a shareholder or creditor, and the heirs and legal representatives of any such person, against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, reasonably incurred by such person in respect of any civil, criminal or administrative action or proceeding to which the person is made a party by reason of being or having been a director or officer of such corporation or body corporate, if

(a) the person acted honestly and in good faith with a view to the best interests of the Corporation; and

(b) in the case of a criminal or administrative action or proceeding that is enforced by a monetary penalty, the person had reasonable grounds for believing that the relevant conduct was lawful.

The Corporation may, with the approval of the court, indemnify a person referred to above in respect of an action by or on behalf of the Corporation or body corporate to procure a judgment in its favour, to which the person is made a party by reason of bring or having been a director or an officer of the Corporation or body corporate, against all costs, charges and expenses reasonably incurred by that person in connection with such action if the person fulfills the conditions set out in (a) and (b) above.

Notwithstanding anything in this section, a person referred to above is entitled to indemnity from the Corporation in respect of all costs, charges and expenses reasonably incurred by that person in connection with the defense of any civil, criminal or administrative action or proceeding to which the person is made a party by reason of being or having been a director or officer of the Corporation or body corporate, if the person seeking indemnity,

(a) was substantially successful on the merits in that person's defense of the action or proceeding;

(b) fulfills the conditions set out in (a) and (b) above; and

(c) is fairly and reasonably entitled to indemnity.

7.2    Insurance - Subject to the Act, the Corporation may purchase and maintain insurance for the benefit of any person referenced to above against any liability incurred by that person,

(a) in the capacity as a director or officer of the Corporation, except where the liability relates to that person’s failure to act honestly and in good faith with a view to the best interests of the, Corporation; or

(b) in the capacity as a director or officer of another body corporate where said person acts or acted in that capacity at the Corporation’s request, except where the liability relates to that person’s future to act honestly and in good faith with a view to the best interests of the body corporate.

8 - MEETINGS OF SHAREHOLDERS

8.1   Annual Meetings - - The annual meeting of shareholders shall be held on such day and at such time in each year as the board, or the chairman of the board, or the president, in the absence of the chairman of the board, may from time to time determine, for the purpose of considering the financial statements and reports required by the Act to be placed before the annual meeting, electing directors, appointing auditors and the transaction of such other business as may properly be brought before the meeting.

8.2   Special Meetings - - The board shall have power to call a special meeting of shareholders at any time.

8.3    Resolution in Lieu of Meeting - Except where a written statement is submitted by a director or where representations in writing are submitted by an auditor in accordance with the provisions of the Act, a resolution in writing signed by all the shareholders entitled to vote on that resolution at a meeting of shareholders is as valid as if it had been passed at a meeting of the shareholders; and a resolution in writing dealing with all matters required to be dealt with at a meeting of shareholders, and signed by all the shareholders entitled to vote at Such meeting, satisfies all the requirements of the Act relating to meetings of shareholders.

8.4    Place of Meetings - Subject to the articles and any unanimous shareholder agreement, a meeting of shareholders of the Corporation shall be held at such place in or outside Alberta as the directors determine or, in the absence of such a determination, at the place where the registered office of the Corporation is located.

8.5    Notices of Meetings - Notice of the time and place of every meeting of shareholders shall be sent not less than 21 days and not more than 50 days before the meeting to each shareholder entitled to vote at the meeting, to each director and to the auditor of the Corporation. Notice of a meeting of shareholders at which special business is to be transacted shall state or be accompanied by a statement of (I) the nature of that business in sufficient detail to permit the shareholder to form a reasoned judgment thereon and (ii) the text of any special resolution or by-law to be submitted to the meeting. All business transacted at a special meeting of shareholders and all business transacted at an annual meeting of shareholders, except consideration of the minutes of an earlier meeting, the financial statements and auditor’s report, election of directors and reappointment of the incumbent auditor, is deemed to be special business.

8.6    Record Date for Notice - The board may fix in advance a record date, preceding the date of any meeting of shareholders by not more than 50 days and not less than 21 days, for the determination of the shareholders entitled to notice of the meeting, provided that notice of any such record date is given, not less than 7 days before such record date, by advertisement in a newspaper published or distributed in the place where the Corporation has its registered office and in each place in Canada where it has a transfer agent or where a transfer of the Corporation’s shares may be recorded, and, where applicable, by written notice to each stock exchange in Canada on which the Corporation’s shares are listed for trading unless notice of the record date is waived in writing by every holder of a share of the class or series affected whose name is set out in the securities register of the Corporation at the close of business on the day the directors fix the record date. If no record date is fixed the record date for the determination of the shareholders entitled to notice of the meeting shall be at the close of business on the day immediately preceding the day on which the notice is given.

8.7    Chairman and Secretary - The chairman of the board or, in the absence of the chairman, the president or, in the absence of the president, a vice-president shall be chairman of any meeting of shareholders and, if none of the said officers be present within 15 minutes after the time appointed for holding the meeting, the shareholders present and entitled to vote shall choose a chairman from amongst themselves. The secretary of the Corporation shah act as secretary at any meeting of shareholders or, if the secretary of the Corporation be absent, the chairman of the meeting shall appoint some person who need not be a shareholder, to act as secretary of the meeting.

8.8    Persons Entitled to be Present - The only persons entitled to be present at a meeting of shareholders shall be those entitled to vote thereat, the directors and auditors of the Corporation and others who, although not entitled to vote, are entitled or required under any provision of the Act or the articles or by-laws to be present at the meeting. Any other person may be admitted only on the invitation of the chairman of the meeting or with the consent of the meeting.

8.9    Quorum - A quorum of shareholders is present at a meeting of shareholders irrespective of the number of persons actually present at the meeting, if the holders of a majority of the shares entitled to vote at the meeting, are present in person or represented by proxy. A quorum need not be present throughout the meeting provided that a quorum is present at the opening of the meeting.

8.10   Right to Vote - Each share of the Corporation entities the holder of it to one vote at a meeting of shareholders.

8.11    Proxies and Representatives - Every shareholder entitled to vote at a meeting of shareholders may, by means of a proxy, appoint a proxyholder, and one or more alternate proxyholders, who need not be shareholders, as that shareholder’s nominee, to attend and act at the meeting in the manner, to the extent, and with the authority conferred by the proxy. A proxy shall be in writing executed by the shareholder or shareholder’s attorney authorized in writing. A body corporate or association which is a shareholder of the Corporation may be represented at a meeting of shareholders by any individual authorized by a resolution of its directors or governing body of the body corporate or association and such individual may exercise on behalf of the body corporate or association represented all the powers it could exercise if it were an individual shareholder. In the case of a proxy appointing a proxyholder to attend and act at a meeting or meetings of shareholders of an offering corporation, the proxy ceases to be valid one year from its date.

8.12    Time for Deposit of Proxies - The directors may by resolution fix a time not exceeding forty-eight hours, excluding non-business days, preceding any meeting or adjourned, meeting of shareholders before which time proxies to be used at that meeting must be deposited with the Corporation or an agent thereof, and any period of time so fixed shall be specified in the notice calling the meeting. A proxy may be used at the meeting only if, prior to the time so specified, it shall have been deposited with the Corporation or an agent thereof specified in such notice or, if no such time is specified in such notice, it shall have been received by the secretary of the Corporation or by the chairman of the meeting or adjournment thereof prior to the time of voting.

8.13    Joint Shareholders - Where two or more persons hold the same shares jointly, one of those holders present or represented by proxy at a meeting of shareholders may in the absence of the other or others vote such shares, but, if more than one of such persons are present or represented by proxy, that one of such persons whose name stands first on the securities register of the Corporation or that person’s proxy shall alone be entitled to vote such shares.

8.14    Votes to Govern - - Except as otherwise required by the Act, all questions proposed for the consideration of shareholders at a meeting of shareholders shall be determined by the .majority of the votes cast, whether by a show of hands or by ballot, as the case may be.

8.15    Casting Vote - In case of an equality of votes at any meeting of shareholders either upon a show of hands or upon a ballot, the chairman of the meeting shall be entitled to a second or casting vote.

8.16    Show of Hands - Any question at a meeting of shareholders shall be decided by a show of hands unless a ballot thereon is required or demanded as hereinafter provided. Upon a show of hands every person who is present and entitled to vote thereon shall have one vote. Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon is so required or demanded, a declaration by the chairman of the meeting that the vote upon the question has been carried or carried by a particular majority or not carried and an entry to that effect in the minutes of the meeting shall be prima facie evidence of the fact without proof of the number -or proportion of the votes recorded in favour of at against any resolution or other proceeding in respect of the said question, and the resu1t of the vote so taken shall be the decision of the shareholders upon the said question.

8.17    Ballots - On any question proposed for consideration at a meeting of shareholders, and whether or not a show of hands has been taken thereon, the chairman may require, or any shareholder or proxyholder entitled to vote at the meeting may demand, a ballot, A ballot so required or demanded shall be taken in such manner as the chairman shall direct. A requirement or demand for a ballot may be withdrawn at any time prior to the taking of the ballot. If a ballot is taken each person present shah be entitled, in respect of the shares which the person is entitled to vote at the meeting upon the question, to that number of votes provided by the Act or the articles, and the result of the ballot so taken shall be the decision of the shareholders upon the said question.

8.18    Adjournment - If a meeting of shareholders is adjourned for less than 30 days, it shall not be necessary to give notice of the adjourned meeting, other than by announcement at the earliest meeting that is adjourned. If a meeting of shareholders is adjourned by one or more adjournments for an aggregate of 30 days or more, notice of the adjourned meeting shall be given as for an original meeting.

8.19    One Shareholder - - Where the Corporation has only one shareholder or only one holder of any class or series of shares, the shareholder present in person or by proxy constitutes a meeting.

9  -  SECURITIES

9.1    Options or Rights - Subject to the provisions of the Act, the articles and any unanimous shareholder agreement, the board may from time to time issue or grant options to purchase or rights to acquire unissued shares of the Corporation at such times and to such persons and for such consideration as the board shall determine, provided that no share shall be issued until it is fully paid.

9.2    Commissions - The board may from time to time authorize the Corporation to pay a reasonable commission to any person in consideration of purchasing or agreeing to purchase shares of the Corporation, whether from the Corporation or from any other person, or procuring or agreeing to procure Purchasers for any such shares.

9.3    Securities Records - The Corporation shall prepare and maintain, at its registered office or at any other place in Alberta designated by the, board, a securities register in which it records the securities issued by it in registered form, showing with respect to each class or series of securities:

(a) the names, alphabetically arranged, and the latest known address of each person who is or has been a security holder;

(b) the number of shares or other securities held by each holder; and

(c) the date and particulars of the issue and transfer of each security.

9.4    Register of Transfer - The Corporation shall cause to be kept a register of transfers in which all transfers of securities issued by the Corporation in registered form and the date and other particulars of each transfer shall be set out.

9.5    Registration of Transfer - Subject to the provisions of the Act, no transfer of shares shall be registered in a securities register except upon presentation of the certificate representing such shares with a transfer endorsed thereon or delivered therewith duly executed by the registered holder or by the holder’s attorney or successor duly appointed, together with such reasonable assurance or evidence of signature, identification and authority to transfer as the board may from time to time prescribe, upon payment of all applicable taxes and any fees prescribed by the board or in accordance with the Act upon compliance with such restrictions on transfer as are authorized by the articles and upon satisfaction of any lien referred to in section 9.6.

9.6    Lien for Indebtedness - Except in the case of any class or series of shares of the .Corporation listed on a stock exchange, the Corporation shall have a lien an the shares registered in the name of a shareholder who is indebted to the Corporation, to the extent of such indebtedness and such lien may be enforced, subject to any provision of the articles and to any unanimous shareholder agreement, by the sale of the shares thereby affected or by any other action, suit, remedy or proceeding authorized or permitted by law or by equity and, pending such enforcement, the Corporation may refuse to register a transfer of the whole or part of such shares.

9.7    Non-recognition of Trusts - Subject to the provisions of the Act, the Corporation may treat the registered owner of a share as the person exclusively entitled to vote, to receive notices, to receive any dividend or other payments in respect thereof and otherwise to exercise all the rights and powers of an owner of a share.

9.8    Security Instruments - Every holder of one or more securities of the Corporation shall be entitled, at the holder’s option, to a security certificate in respect of the securities held by that person or to a non-transferable written acknowledgement of that person’s right to obtain a security certificate, stating the number and class or series of shares held by that person as shown on the securities register. Security certificates and acknowledgements of a shareholder’s right to a security certificate, respectively, shall be in such form as the board may from time to time approve. Unless otherwise ordered by the board, security certificates shall be signed by any one of:

(a) the chairman of the board, the president, the managing director, a vice-president or a director,

or any one of:

(b) the secretary, treasurer, any assistant secretary or any assistant treasurer or a director

and need not be under corporate seal. Signatures of signing officers may be printed or mechanically reproduced in facsimile. upon security certificates and every such facsimile shall for all purposes be deemed to be the signature of the officer whose signature it reproduces and shall be binding upon the Corporation; provided that at least one director or officer of the Corporation shall manually sign each certificate (other than a scrip certificate or a certificate representing a fractional share or a warrant or a promissory note that is not issued under a trust indenture) in the absence of a manual signature thereon of a duly appointed transfer agent, registrar, branch transfer agent or issuing or other authenticating agent of the Corporation or trustee who certifies it in accordance with a trust indenture. A security certificate executed as aforesaid shall be valid notwithstanding that an officer whose facsimile signature appears thereon no longer holds office at the date of issue of the certificate.

9.9    Replacement of Security Certificates - Subject to the provisions of the Act, the board or any officer or agent designated by the board may in the discretion of the board or that person direct the issue of a new security certificate in lieu of and upon cancellation of a security certificate claimed to have been lost, apparently destroyed or wrongfully taken on payment of such fee, prescribed by or in accordance with the Act, and on such terms as to indemnity, reimbursement of expenses and evidence of loss and of title as the board may from time to time prescribe, whether generally or in any particular case.

9.10    Joint Shareholders - If two or more persons are registered as joint holders of any share, the Corporation shall not be bound to issue more than one certificate in respect thereof, and delivery of such certificate to one of such persons shall be sufficient delivery to all of them. Any one of such persons may give effectual receipts for the certificate issued in respect thereof or for any dividend, bonus, return of capital or other money payable or warrant issuable in respect of such share.

9.11    Deceased Shareholders - In the event of the death of a holder, or of one of the joint holders, of any share, the Corporation shall not be required to make any entry in the securities register in respect thereof or to make payment of any dividends thereon except upon production of all such documents as may be required by the Act and upon compliance with the reasonable requirements of the Corporation or transfer agent.

10  -  DIVIDENDS AND RIGHTS

10.1    Dividends - Subject to the provisions of the Act, the articles and any unanimous shareholder agreement, the board may from time to time declare dividends payable to the shareholders according to their respective rights and interests in the Corporation. Dividends may be paid in money or property or by issuing fully paid shares or options or rights to acquire fully paid shares of the Corporation.

10.2    Dividend Cheques - A dividend payable in cash shall be paid by cheque drawn on the Corporation’s bankers or one of them to the order of each registered holder of shares of the class or series in respect of which it has been declared and mailed by prepaid ordinary mail to such registered holder at the address recorded in the Corporation’s securities register, unless in each case such holder otherwise directs, In the case of joint holders the cheque shall, unless such joint holders otherwise direct, be made payable to the order of all of such joint holders and, if more than one address is recorded in the Corporation’s security register in respect of such joint holding, the cheque shall be mailed to the first address so appearing. The mailing of such cheque as aforesaid, unless the same, is not paid on due presentation, shall satisfy and discharge the liability for the dividend to the extent of the sum represented thereby plus the amount of any tax which the Corporation is required to and does withhold.

10.3    Non-receipt or Loss of Cheques - In the event of non-receipt or loss of any dividend cheque by the person to whom it is sent, the Corporation shall issue, to such person a replacement cheque for a like amount on such terms as to indemnity, reimbursement of expenses and evidence of non-receipt and of title as the board may from time to time prescribe, whether generally or in any particular case.

10.4    Record Date for Dividends and Rights - The board may fix in advance a date as the record date for the determination of the shareholders entitled to receive payment of a dividend, entitled to participate in a liquidation or distribution, or for any other purpose except to receive notice of or to vote at a meeting, but the record date shall not precede by more than 50 days the particular action to be taken, Notice of the record date shall be given, not less than 7 days before such record date, by advertisement in a newspaper published or distributed in the place where the. Corporation has its registered office and in each place in Canada where it has a transfer agent or where a transfer of the Corporation’s shares may be recorded and, where applicable, by written notice to each stock exchange in Canada on which the Corporation’s shares are listed for trading, unless notice of the record date is waived in writing by every holder of a share of the class or series affected whose name is set out in the securities register of the Corporation at the close of business on the day the directors fix the record date, If no such record date is fixed, such record date shall be the close of business on the day on which the directors pass the resolutions relating thereto.

10.5    Unclaimed Dividends - Any dividend unclaimed after a period of six years from the date on which the same has been declared to be payable shall be forfeited and shall revert to the Corporation.

11  -  NOTICES

11.1    Method of Giving Notices - Any notice, communication or document (“notice”) to be given or sent pursuant to the Act, the articles, the by-laws or otherwise to or on a shareholder, director, officer, auditor or member of a committee of the board shall be sufficiently given or sent if given or sent by prepaid mail, prepaid transmitted or recorded communication, or delivered personally to such person’s latest address as shown on the securities register of the Corporation or, in the case of a director, if more current, the address as shown in the most recent notice filed under the Act. A notice shall be deemed to have been received on the date when it is delivered personally, or if by mail, at the time it would be delivered in the ordinary course of mail, or on the date of dispatch of a transmitted or recorded communication. The secretary may change or cause to be changed the recorded address of any shareholder, director, officer, auditor or member of a committee of the board in accordance with any information believed by the secretary to be reliable.

11.2    Notice to Joint Shareholders - If two or more persons are registered as joint holders of any share, any notice shall be addressed to all of such joint holders but notice to one of such persons shall be sufficient notice to all of them.

11.3    Computation of Time - In computing the date when notice must be sent under any provision requiring a specified period of days’ notice of any meeting or other event, the period of days shall commence on the day following the sending of such notice and shall terminate on the day preceding the date of the meeting or other event provided that the last day of the period shall not be a non-business day.

11.4    Undelivered Notices - If any notice given or sent to a shareholder pursuant to section 11.1 is returned on three consecutive occasions because the person cannot be found, the Corporation shall not be required to give or send any further notice to such shareholder until the Corporation is informed in writing of the new address for such person.

11.5    Omissions and Errors - The accident omission to give or send any notice to any shareholder, director, officer, auditor or member of a committee of the board or the non-receipt of any notice by any such person or any error in any notice not affecting the substance thereof shall not invalidate any action taken at any meeting held pursuant to such notice or otherwise based, thereon.

11.6    Persons Entitled by Death or Operation of Law - Every person who, by operation of law, transfer, death of a shareholder or any other means whatsoever, shall become entitled to any share, shall be bound by every notice in respect of such share which shall have been duly given or sent to the shareholder from whom the person derives title to such share prior to that person’s name and address being entered on the securities register (whether such notice was given or sent before or after the happening of the event upon which that person becomes so entitled) and prior to that person furnishing to the Corporation the proof of authority or evidence of entitlement prescribed by the Act.

11.7    Waiver of Notice - Any shareholder (or shareholder’s duly appointed proxyholder), director, officer, auditor or member of a committee of the board may at any time waive the giving or sending of any notice, or waive or abridge the time, for any notice, required to be given to that person under any provision of the Act, the articles, the, by-laws or otherwise and such waiver or abridgement shall cure any default in the giving or sending or in, the time of such notice, as the case may be. Any such waiver or abridgement shall be in writing except a waiver of notice of a meeting of shareholders or of the board which may be given in any manner. Attendance of a director at a meeting of directors or of a shareholder or any other person entitled to attend a meeting of shareholders is a waiver of notice of the meeting except where such director, shareholder or other person, as the case may be, attends a meeting for the express purpose of objecting to the transaction of any business on the grounds that the meeting is not lawfully called.

        The foregoing By-law No. I is hereby passed as evidenced by the signatures of all the directors of the Corporation pursuant to the provisions of the Business Corporation Act (Alberta).

        DATED this 28th day of April, 2000.


/s/ Philip C. Ackerman                                                                                                     /s/ Alyson F. Goldman                 
Philip C. Ackerman                                                                                                           Alyson F. Goldman


/s/ Bernard J. Kennedy                                                                                                    /s/ Chris W. Nixon                          
Bernard J. Kennedy                                                                                                          Chris W. Nixon


        The foregoing By-law No. I is hereby confirmed as evidenced by the signature of the sole shareholder of the Corporation entitled to vote pursuant to the provisions of the Business Corporations Act (Alberta).

        DATED this 28th day of April, 2000.

3041765 NOVA SCOTIA COMPANY

/s/ Bernard J. Kennedy

EX-99

                        AGREEMENT PURSUANT TO RULE 45 (c)

                  UNDER THE PUBLIC UTILITY HOLDING ACT OF 1935



         WHEREAS,   National  Fuel  Gas  Company  ("National"),   a  corporation
organized  under the laws of the State of New  Jersey and a  registered  holding
company under the Public Utility Holding  Company Act of 1935 ("Act"),  together
with its wholly-owned domestic subsidiaries, listed below:

         National Fuel Gas Distribution Corporation
         National Fuel Gas Supply Corporation
         Seneca Resources Corporation
         Leidy Hub, Inc.
         Highland Forest Resources, Inc.
         Data-Track Account Services, Inc.
         National Fuel Resources, Inc.
         Horizon Energy Development, Inc.
         Seneca Independence Pipeline Company
         Upstate Energy Inc.
         Niagara Independence Marketing Company
         Horizon Energy Holdings, Inc., a wholly-owned subsidiary of Horizon
           Energy Development, Inc.
         NFR Power, Inc.


join annually in the filing of a consolidated federal income tax return; and

         WHEREAS,   it  is  the  intention  of  National  and  its  subsidiaries
(hereinafter  collectively  referred  to as the  "System"),  to enter into a Tax
Agreement for the allocation of current federal income taxes; and
         WHEREAS,  Rule 45 (c) of the Act has been adopted by the Securities and
Exchange  Commission  with the  specific  intention  of  providing  a method  of
allocation of consolidated  federal income taxes by a registered holding company
and its subsidiaries;
         NOW,  THEREFORE,  the System  does hereby  covenant  and agree with one
another that the consolidated current federal income tax liability of the System
shall be  allocated  pursuant to Rule 45 (c) of the Act, so that each company of
the System will benefit mutually from the application of said Rule, as follows:
         FIRST:  There shall be allocated  and preserved to each company the tax
effects of its own capital gains or losses which shall be subject to the capital
gains rate, if applicable, its tax credits,  investment tax credit recapture and
the effects of any other  material  items taxed at different  rates or involving
special  benefits  or  limitations  as may  result  from  an  unexpected  event,
including  changes to the  Internal  Revenue Code which may be  applicable  to a
particular company, including its carry-over amounts to the extent those amounts
are absorbed in the taxable year.
         SECOND:  After giving  effect to the special  allocations  described in
paragraph  First above,  the balance of the current tax  liability of the System
shall  be  allocated  to each  System  company  on the  basis  of each of  their
respective  contributions of corporate taxable income to the total  consolidated
taxable  income of the  System,  excluding  income  subject to  taxation  at the
capital gains rate, if applicable. The tax attributable to such income will have
been separately allocated pursuant to paragraph First above. However, so long as
National has negative  corporate  taxable income,  no portion of the current tax
liability shall be allocated to National as a corporate tax credit. Instead, the
negative corporate taxable income of National shall be allocated to those System
companies which have positive  corporate taxable income, on the basis of each of
these companies'  contribution of positive corporate taxable income to the total
positive  corporate taxable income of the System. The tax allocated to a company
under this  paragraph,  which may be either  positive  or  negative  (except for
National)  shall be equal to the  consolidated  tax  liability  multiplied  by a
fraction, the numerator of which is the positive corporate taxable income of the
Company (as adjusted by National's  negative  corporate taxable income described
in  this  paragraph  Second  above  and in  paragraph  Third);  or the  negative
corporate  taxable  income of the Company  (as  adjusted  in  paragraph  Third),
including any carry-over loss attributable to the Company to the extent absorbed
in the taxable year, and the  denominator of which is the  consolidated  taxable
income of the System (as adjusted in paragraphs First and Third). Companies with
taxable  income  will be  allocated  a tax  liability  under this  method  while
companies with net operating  losses  (except  National) will be allocated a tax
benefit or credit.
         THIRD:  The tax effect of intercompany  transactions  eliminated in the
calculation  of  consolidated  taxable  income  shall  be  eliminated  from  the
corporate  taxable income of the companies  involved in such transactions in the
calculations provided in paragraph Second.
         FOURTH:   Any   consolidated   alternative   minimum   income  tax  and
environmental tax arising from consolidated  alternative  minimum taxable income
(AMTI)  will be  allocated  among  the  companies  on the basis of each of their
respective  contributions  of positive  AMTI to the total  positive  AMTI of the
System.
         FIFTH:  Under the method of allocation  described in  paragraphs  First
through Fourth above, the companies agree that the tax allocated to each company
(except  National) shall not exceed the amount of tax of such company based upon
a separate  return  computed as if such company had always filed its tax returns
on a separate  return  basis.  However,  in computing  the  separate  return tax
liability of a company,  items of  carry-forward,  carry-back  and  intercompany
transactions, to the extent that any or all of these items have been utilized by
the System in a prior taxable year's allocation, will be disregarded in order to
comply with the separate return  limitation  provisions set forth in Rule 45 (c)
of the  Act and  regulations  promulgated  under  Section  1552 of the  Internal
Revenue  Code.  Thus,  to the extent  that a company  receives a tax  benefit or
credit  pursuant to  paragraph  Second  above,  such  benefit or credit would be
applied to reduce any tax credits in future  years to which such  company  might
otherwise  become  entitled under the separate return  limitation  provisions of
Rule 45 (c) of the Act and  regulations  promulgated  under  Section 1552 of the
Internal Revenue Code.
         IT IS FURTHER AGREED by and among the System as follows:
         I.  PAYMENTS:  It is agreed  that those  companies  allocated a current
federal income tax liability under this agreement will pay the Internal  Revenue
Service a portion of that  liability in the amounts and on the dates directed by
National,  as determined and pursuant to the applicable sections of the Internal
Revenue Code.  Another  portion of the current  federal  income tax liability of
those  companies  shall  be  paid  by them to the  other  companies  which  were
allocated a tax benefit.  Such  payments will also be made in the amounts and on
the dates directed by National.
         II.  SEPARATE RETURN  LIABILITY:  The System intends that the result of
         the proposed  method of allocation  and payment will be: (a) No company
         will pay more than its  separate  return  liability as if it had always
         filed  separate  returns.   However,  the  qualifications  set  out  in
         paragraph  Fifth above  concerning the calculation of a separate return
         tax shall apply;  (b) Each company having a net operating loss or other
         net tax benefit will  receive in current  cash  payments the benefit of
         its own net operating loss (except as described in paragraph Second) or
         other net tax  benefits  to the  extent  that the other  companies  can
         utilize  such items to offset the tax  liability  they would  otherwise
         have  on a  separate  return  basis.  III.  EFFECTIVE  DATE:  This  Tax
         Agreement  will be effective for  allocation of the current  income tax
         liability of the system for
the fiscal year 1999 and all subsequent  years until this Tax Agreement shall be
amended in writing by each of the companies which is a party thereto.
         IV. APPROVAL AND  AMENDMENTS:  Any amendments to this Tax Agreement may
be made only with the unanimous  written  consent of all the parties  hereto.  A
copy of this Tax Agreement is being filed as an exhibit to  National's  Form U5S
Annual  Report to the  Securities  and  Exchange  Commission  for the year ended
September 30, 2000.  Any  amendments  to this Tax Agreement  will be filed as an
exhibit  to  National's  Form  U5S for  the  year  when  the  amendment  becomes
effective.  It is  contemplated  that any additional  companies  which hereafter
become  associated  with the  System  shall  have the  option of  joining in and
becoming a party to this Tax Agreement by amendment thereto.
         V. PRIOR AGREEMENTS  SUPERSEDED:  Any prior agreements  relating to the
allocation of income tax liability among the System are superseded.
         IN WITNESS  WHEREOF,  each of the  parties  hereto have caused this Tax
Agreement  to be executed  in its name and on its behalf by one of its  officers
duly authorized, and its corporate seal to be affixed hereto by its Secretary on
this 29th day of January 2001.
                                           NATIONAL FUEL GAS COMPANY

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           NATIONAL FUEL GAS DISTRIBUTION
                                                CORPORATION

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           NATIONAL FUEL GAS SUPPLY
                                                CORPORATION

                                           By: /s/Joseph P. Pawlowski
                                           --------------------------
                                                Joseph P. Pawlowski
                                                      Treasurer


                                           SENECA RESOURCES CORPORATION

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           LEIDY HUB, INC.

                                           By: /s/Gerald T. Wehrlin
                                           ------------------------
                                                Gerald T. Wehrlin
                                                      Treasurer

                                           HIGHLAND FOREST RESOURCES, INC.

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer

                                            DATA-TRACK ACCOUNT SERVICES,
                                              INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer


                                           NATIONAL FUEL RESOURCES, INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer

                                           HORIZON ENERGY DEVELOPMENT,
                                               INC.

                                           By: /s/Ronald J. Tanski
                                           -----------------------
                                                Ronald J. Tanski
                                                      Treasurer


                                           SENECA INDEPENDENCE PIPELINE
                                                COMPANY

                                           By: /s/Walter E. DeForest
                                           -----------------------
                                                Walter E. DeForest
                                                      Treasurer


                                           UPSTATE ENERGY INC.

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           NIAGARA INDEPENDENCE
                                             MARKETING COMPANY

                                           By: /s/Calvin H. Friedrich
                                           --------------------------
                                                Calvin H. Friedrich
                                                      Treasurer


                                           HORIZON ENERGY HOLDINGS, INC.

                                           By: /s/Ronald J. Tanski
                                           -----------------------
                                                Ronald J. Tanski
                                                      Treasurer


                                           NFR POWER, INC.

                                           By: /s/William M. Petmecky
                                           --------------------------
                                                William M. Petmecky
                                                      Treasurer

EX-99

                                                                   Exhibit H-2


                            National Fuel Gas Company
         Organization Chart of Foreign Utility Company Ownership (FUCO)
                            As of September 30, 2000




                           ---------------------------
                            National Fuel Gas Company
                           ---------------------------

                                                     100%
                       ----------------------------------
                        Horizon Energy Development, Inc.
                       ----------------------------------

                                                     100%
                         -------------------------------
                          Horizon Energy Holdings, Inc.
                         -------------------------------

                                                     100%
                        ---------------------------------
                         Horizon Energy Development B.V.
                        ---------------------------------

                                                   84.73%
                          ----------------------------
                               United Energy, a.s.
                                     (FUCO)
                          ----------------------------

                                                      70%
                            ------------------------
                             Teplarna Liberec, a.s.
                                     (FUCO)
                            ------------------------




Note: Percents reported represent percent of voting power as of September 30,
2000

EX-99

                                                                 Exhibit I-1

                              Auditor's statement

Auditors report to the shareholders of Prvni Severozapadni Teplarenska, a.s.,
the legal successor of Severoceske Teplarny, a.s.

We have audited the financial statements of Severoceske  teplarny,  a.s. for the
year ended 31 December  1999.  The Board of  Directors  is  responsible  for the
preparation of the financial statements and for maintaining  accounting which is
complete,  supportable and correct.  Our responsibility is to express an opinion
on the financial  statements  taken as a whole,  based on our audit performed in
accordance  with the CNR Act no.  524/1992 Coll., on Auditors and the Chamber of
Auditors of the Czech Republic and the auditing guidelines issued by the Chamber
of Auditors.

The  auditing  guidelines  require  that we plan and perform the audit to obtain
reasonable  assurance  that  the  financial  statements  are  free  of  material
misstatements.  Our audit includes an examination of the evidence supporting the
financial  statements  with respect to the closed books of the company  wound up
without  liquidation in the  transformation.  Our audit also includes  assessing
whether  the  accounting  policies  used  and  significant   estimates  made  by
management are fair and suitable, as well as evaluating the overall presentation
of the financial  statements.  Our audit  procedures  were carried out on a test
basis and with regard to the principle of materiality. We believe that our audit
provides a reasonable basis for expressing our opinion.

In our  opinion,  the  financial  statements  present  fairly,  in all  material
aspects, the assets,  liabilities,  equity and financial position of Severoceske
teplarny,  a.s., as at 31 December  1999 and the financial  results for the year
then ended in accordance with valid acts and relevant accounting legislation.

In  conclusion  we note that the joint stock  company  Severoceske  teplarny was
deleted from the Registrar of Companies at 31, December 1999 and merged with the
joint stock company Prvni severozapadni teplarenska.

Prague March 26, 2000

Auditing company:                    Statutory auditor:

Consultas - Audit, s.r.o.            Jaroslav Suva
License number 87                    License number 234





                           SEVEROCESKE TEPLARNY, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET


  ASSETS                                    12/31/99           12/31/98
  ------                                   ---------          ---------
                                                     (CZK 000's)
                                            ---------------------------

Total Assets                                2,038,985         1,967,372
                                            =========         =========

Intang. & Tang. Assets & Invest.            1,820,578         1,609,480
                                            ---------         ---------
  Intangible Assets                             4,202             3,216
                                            ---------         ---------
    Software                                    3,256               718
    Intangibles in Progress                       946             2,498
    Advances for Intangibles                        -                 -
                                            ---------         ---------
  Tangible Assets                           1,370,604         1,337,659
                                            ---------         ---------
    Land                                       34,172            33,773
    Building, Halls & Constructions           897,851           927,602
    Sep. Movab. Items & Groups of
     Mov. Items                               359,607           322,639
    Other Tangible Assets                          20                20
    Tangibles in Progress                      73,922            52,341
    Advances for Tangibles                      5,032             1,334
    Adjustment to Acquired Property                 -               (50)
                                            ---------         ---------
  Financial Investment                        445,772           268,605
                                            ---------         ---------
    Major. Sharehol. & Particip.
     Inter. (50%)                             411,523           211,823
    Subst. Sharhol. & Partic.
     Inter. (20-50%)                           34,249            44,249
    Intergroup Loans                                -             5,155
    Other Loans & Financial Investment              -             7,378
                                            ---------         ---------
Current Assets                                214,950           355,981
                                            ---------         ---------
  Inventory                                    44,334            55,203
                                            ---------         ---------
    Materials                                  40,152            42,182
    Work in Progress & Semi-Finished
     Product.                                   4,182            13,021
                                            ---------         ---------
  Long-Term Receivables                        12,601            11,373
                                            ---------         ---------
    Trade and Other Receivables                11,801            10,345
    Other Receivables                             800             1,028
                                            ---------         ---------
  Short-Term Receivables                      143,848           120,704
                                            ---------         ---------
    Trade Receivables                         127,270           109,159
    Receivables From Taxes & Subsidies          7,749             8,590
    Receiv. From Related Comp.
     (Sharehol. 20-50%)                         7,901                 -
    Other Receivables                             928             2,955
                                            ---------         ---------
  Financial Accounts                           14,167           168,701
                                            ---------         ---------
    Cash                                          299               377
    Bank Accounts                              13,868            28,324
    Short-Term Financial Assets                     -           140,000
                                            ---------         ---------
Other Assets                                    3,457             1,911
                                            ---------         ---------
  Temporary Accounts of Assets                  2,272             1,798
                                            ---------         ---------
    Prepaid Expenses                            1,338             1,752
    Unbilled Revenue                              934                46
                                            ---------         ---------
  Contingencies-Gain                            1,185               113






                           SEVEROCESKE TEPLARNY, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET


                                            12/31/99           12/31/98
                                           ---------          ---------
                                                   (CZK 000's)
                                           ----------------------------

Total Capital & Liabilities                2,038,985          1,967,372
                                           =========          =========
Capital                                    1,783,770          1,719,379
                                           ---------          ---------
  Basic Capital                            1,133,279          1,133,279
  Capital Funds                               25,747             25,030
                                           ---------          ---------
  Funds Created From Profit                  130,506            124,105
                                           ---------          ---------
    Legal Reserve Fund                       127,102            121,278
    Statutory and Other Funds                  3,404              2,827
                                           ---------          ---------
  Retained Earnings                          377,309            320,491
  Profit and Loss of Current Accounting
   Period                                    116,929            116,474
                                           ---------          ---------
Liabilities                                  248,231            244,223
                                           ---------          ---------
  Reserves                                         -              9,863
                                           ---------          ---------
    Legal Reserves (i.e. Tax Deductible)           -              9,863
    Other Reserves                                 -                  -
                                           ---------          ---------
  Long-Term Liabilities                          609              1,414
                                           ---------          ---------
  Short-Term Liabilities                      84,623             95,845
                                           ---------          ---------
    Trade Payables                            42,475             60,894
    Payables to Partners and Associations      1,293              2,389
    Payables to Employees                      1,029              1,071
    Social Security Payable                    2,635              2,757
    Taxes Payable                                693                852
    Deferred Taxes                            29,418             20,881
    Other Payables                             7,080              7,001
                                           ---------          ---------
  Bank Loans and Short Term Notes            162,999            137,101
                                           ---------          ---------
    Long-Term Bank Loans                     112,999            137,101
    Short-Term Bank Loans                     50,000                  -

Other Liabilities-Temporary Accounts of
 Liabilities                                   6,984              3,770
                                           ---------          ---------
    Accruals                                     712                232
                                           ---------          ---------
      Accruals                                   712                 75
      Deferred Income                              -                157
                                           ---------          ---------
    Contingencies-Loss                         6,272              3,538





                           SEVEROCESKE TEPLARNY, a.s.
                FINANCIAL STATEMENTS - PROFIT AND LOSS STATEMENT


                                            12/31/99           12/31/98
                                            --------           --------
                                                   (CZK 000's)
                                            ---------------------------


Operation Revenues (A)                       806,393            810,329
                                             -------            -------
  Revenues From Finished Products and
   Services                                  788,442            785,555
  Changes in Inventory                        (8,838)             6,599
  Capitalization (Of Own Work)                26,789             18,175
                                             -------            -------
Consumption From Operation (B)               421,848            461,934
                                             -------            -------
  Consumption of Material and Energy         344,280            373,580
  Services                                    77,568             88,354
                                             -------            -------
Value Added (A)-(B)=(C)                      384,545            348,395
                                             -------            -------
Personnel Expenses                           108,350            103,750
                                             -------            -------
  Wages & Salaries & Earn. Of Part &
   Coop. Members                              78,632             75,098
  Bonus. To Mem. Of Exec. Bodies of
   Companies & Coop.                             648                585
  Social Insurance & Other Expenses           27,238             26,219
  Statutory Social Expenses                    1,832              1,848
                                             -------            -------
Taxes and Fees                                 1,676              1,886
Amortization of Intangibles and
 Depreciation of Tangibles                    81,307             77,727
Rev. From Intangibles & Tangible
 Assets & Material Sold (+)                   24,704             29,903
Net Book Value of Intangible,
 Tangibles and Material Sold (-)              19,352             23,309
Reversal of Reserves & Prepaid Expenses (+)   11,150             24,550
Creation of Reserves & Prepaid Expenses (-)    1,288             10,304
Reversal of Provisions (+)                     5,229              3,746
Creation of Provisions (-)                     7,599              4,925
Other Operational Revenues (+)                   620              1,318
Other Operational Expenses (-)                11,299             13,343
                                             -------            -------
      Net Operating Results (D)              195,377            172,668
                                             -------            -------
Revenues From Sales of Securities and
 Deposits (+)                                    696              1,461
Sold Securities and Deposits (-)              10,300              1,233
Revenues from Financial Investments (+)            -              1,333
Revenues from Short-Term Financial Assets (+)  1,383                102
Interest Revenues (+)                          7,264             21,476
Interest Expenses (-)                         12,930             24,485
Other Financial Revenues (+)                       -                 65
Other Financial Expenses (-)                   4,422              4,615
                                             -------            -------
Transfer of Financial Revenues
Transfer of Financial Expenses
      Net Result From Financial
      Activities (E)                         (18,309)            (5,896)
                                             -------            -------
Income Taxes on Normal Activity (F)          (58,910             55,735
                                             -------            -------
  Due                                         50,372             53,277
  Deferred                                     8,538              2,458
                                             -------            -------
      Net Results After Taxes From Normal
       Activities (D)+(E)-(F)=(G)            118,158            111,037
                                             -------            -------
Extraordinary Revenues (+)                       475              9,541
Extraordinary Expenses (-)                     1,704              1,177
                                             -------            -------
Income Tax on Extraordinary Activity               -              2,927
                                             -------            -------
  Due                                              -              2,927
  Deferred                                         -                  -
                                             -------            -------
      Net Result From Extraordinary
       Activities (H)                         (1,229)             5,437
                                             -------            -------
Income Distribution to Partners
Net Income (Net Loss) for the Account
 Period (G)-(H)                              116,929            116,474
                                             =======            =======
Result of Operations Before Tax              175,839            175,136
                                             =======            =======



                           SEVEROCESKE TEPLARNY, a.s.
                               CASH FLOW STATEMENT
                      For the year ended 31 December 1999

                                                                                         12/31/99     12/31/98
                                                                                         --------     --------
                                                                                                 
Cash and Cash Equivalents at the Beginning of the Accounting Period (A)                   168,701       98,682
                                                                                          -------      -------
Profit/Loss From Normal Activity Before Taxes (B)                                         177,068      166,772
                                                                                          -------      -------
Adjustment by Non-Cash Transactions (C)                                                    90,194       63,904
                                                                                          -------      -------
  Depreciation of Fixed Assets                                                             84,881       79,302
  Change in Provisions, Reserves and Change in Prepayments and Accruals                    (5,240)     (11,467)
  (Profit) Loss From Sale of Fixed Assets                                                   4,887       (5,607)
  Dividends and Profit Revenues                                                                 -       (1,333)
  Interest Expense                                                                          5,666        3,009
                                                                                          -------      -------
Net Cash Flow From Operational Activity (B)+(C)=(D)                                       267,262      230,676
                                                                                          -------      -------
Change in Working Capital (E)                                                             (36,179)      42,328
                                                                                          -------      -------
  Change in Receivables From Operational Activities                                       (27,260)      30,148
  Change in Short-Term Payables From Operational Activities                               (20,988)      19,819
  Change in Inventories Balance                                                            12,069       (7,639)
                                                                                          -------      -------
Net Cash Flow From Oper. Activity Before Taxes (D)+(E)=(F)                                231,083      273,004
                                                                                          -------      -------
Interest Paid (G)                                                                         (12,907)     (24,485)
Interest Received (H)                                                                       6,656       21,408
Tax on Normal Activity and Additional Tax of Prior Years (I)                              (52,594)     (57,598)
Revenues and Expenses Related to Extraordinary Items (J)                                   (1,229)       8,364
                                                                                          -------      -------
  Net Cash Flow From Operational Activity (F)+(G)+(H)+(I)+(J)=(K)                         171,009      220,693
                                                                                          -------      -------
Fixed Asset Acquisition                                                                  (292,252)    (109,119)
Sale of Fixed Assets                                                                       15,639       14,652
Loans to Related Parties                                                                    5,155        2,578
                                                                                          -------      -------
  Net Cash Flow From Investment Activity (L)                                             (271,458)     (91,889)
                                                                                          -------      -------
Change in Long-Term and Short-Term Liabilities (M)                                           (805)        (805)
                                                                                          -------      -------
Impact of Changes in Equity (N)                                                           (53,280)     (59,313)
                                                                                          -------      -------
  Direct Payments Debited to Funds                                                         (1,657)      (1,694)
  Paid-out Dividends and Profit Shares                                                    (51,623)     (57,619)
                                                                                          -------      -------
Dividends and Profit Shares Received (O)                                                        -        1,333
                                                                                          -------      -------
  Net Cash Flow From Financial Activity (M)+(N)+(O)=(P)                                   (54,085)     (58,785)
                                                                                          -------      -------
Net Increase/Decrease in Cash (K)+(L)+(P)=(Q)                                            (154,534)      70,019
                                                                                          -------      -------
Cash and Cash Equivalents as the End of the Accounting Period (A)+(Q)                      14,167      168,701
                                                                                          =======      =======

EX-99

                                                                  Exhibit I-2

                      Auditors report for shareholders of
                             Teplarna Liberec, a.s.



We have audited the financial statements of Teplarna Liberec,  a.s. for the year
ended  31  December  1999.  The  Board  of  Directors  is  responsible  for  the
preparation of the financial statements and for maintaining  accounting which is
complete,  supportable and correct.  Our responsibility is to express an opinion
on the financial  statements  taken as a whole,  based on our audit performed in
accordance  with the CNR Act no.  524/1992 Coll., on Auditors and the Chamber of
Auditors of the Czech Republic and the auditing guidelines issued by the Chamber
of Auditors.

The  auditing  guidelines  require  that we plan and perform the audit to obtain
reasonable  assurance  that  the  financial  statements  are  free  of  material
misstatements.  Our audit includes an examination of the evidence supporting the
financial  statements  with respect to the closed books of the company  wound up
without  liquidation in the  transformation.  Our audit also includes  assessing
whether  the  accounting  policies  used  and  significant   estimates  made  by
management are fair and suitable, as well as evaluating the overall presentation
of the financial  statements.  Our audit  procedures  were carried out on a test
basis and with regard to the principle of materiality. We believe that our audit
provides a reasonable basis for expressing our opinion.

In our  opinion,  the  financial  statements  present  fairly,  in all  material
aspects,  the assets,  liabilities,  equity and  financial  position of Teplarna
Liberec, a.s. as of 31 December 1999 and the financial results for the year then
ended in accordance with valid acts and relevant accounting legislation.

We have verified  whether the information  about the audited period for the past
period  contained  in the  annual  report  is in  conformity  with  the  audited
financial  statements.  In our  opinion,  this  information  is in all  material
respects is in conformity with the audited financial statements from which it is
taken.


Prague, March 24, 2000

Auditing company:                     Statutory auditor:

Consultas-Audit, s.r.o.               Jaroslav Suva
License number 87                     License number 234




                             TEPLARNA LIBEREC, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET
                                     ASSETS


                                            12/31/99           12/31/98
                                            --------           --------

                                                    (CZK 000's)

Total Assets                                 592,026            578,606
                                             =======            =======
Fixed Assets                                 389,073            381,946
                                             -------            -------
 Intangible Assets                               379                421
                                             -------            -------
  Software                                       316                347
  Patents, Copyrights, Trademarks,
   Tradenames                                     63                 74
                                             -------            -------
 Fixed (Tangible) Assets                     388,694            381,375
                                             -------            -------
  Land                                         7,137              7,070
  Plant (Buildings, Halls and Construction)  122,957            117,831
  Capital Equipment                          251,833            238,131
  Acquisition of Fixed Asset in Progress       5,930             13,476
  Deposits Towards Fixed Acquisitions            837              4,867
                                             -------            -------
 Investments (Financial Assets)                    -                150
                                             -------            -------
  Other Investments                                -                150
                                             -------            -------
Current Assets                               202,454            196,244
                                             -------            -------
  Inventory                                   59,944             66,198
                                             -------            -------
   Raw Materials                              59,944             66,198
   Merchandise                                     -                  -
                                             -------            -------
 Accounts Receivable                          63,324             63,324
                                             -------            -------
  Long-Term Receivables                          481                481
                                             -------            -------
    Trade and Other Receivables                  481                481
                                             -------            -------
  Short-Term Receivables                      62,398             62,843
                                             -------            -------
    Accounts Receivable                       56,387             60,797
    Receivable - Taxes                         5,758              1,959
    Other Accounts Receivable                    253                 87
                                             -------            -------
 Current Liquid Assets                        79,631             66,722
                                             -------            -------
  Petty Cash and Deposits in Transit             139                 97
  Cash in Bank                                 3,992             14,625
  Short-Term Assets                           75,500             52,000
                                             -------            -------
Other Assets - Temporary Debit Accounts          499                416
                                             -------            -------
 Accruals                                        198                315
                                             -------            -------
  Pre-Paid Expenses                               94                152
  Unbilled Revenue                               104                163
                                             -------            -------
 Contingencies and Estimate Pre-Paid Items
 (Debit Balance)                                 301                101






                             TEPLARNA LIBEREC, a.s.
                      FINANCIAL STATEMENTS - BALANCE SHEET
                         LIABILITIES AND OWNER'S EQUITY


                                            12/31/99           12/31/98
                                            --------           --------
                                                    (CZK 000's)

Total Liabilities and Owner's Equity         592,026             578,606
                                             =======             =======
Owner's Equity                               532,149             529,542
                                             -------             -------
 Capital Stock at Par                        500,000             500,000
 Restricted Retained Earnings                  2,461               2,068
                                             -------             -------
  Statutory Reserve Account                    2,461               2,068
                                             -------             -------
 Retained Earnings                            26,731              19,626
 Net Income or Net Loss                        2,957               7,848
                                             -------             -------
External Sources (Of Money)                   57,329              40,156
                                             -------             -------
 Reserves                                     17,707              12,779
                                             -------             -------
  Tax Deductible Reserves                          -                   -
  Other Reserves                              17,707              12,779
                                             -------             -------
 Liabilities to Subsidiaries                       -               5,155
                                             -------             -------
 Current Liabilities                          39,622              22,222
                                             -------             -------
  Accounts Payable                            31,142              17,138
  Payroll Payable                                988               1,173
  Social Security Payable                      1,376               1,508
  Taxes Payable                                1,541                 407
  Deferred Taxes Payable                       3,121                 686
  Payable to Subsidiaries                          -                   -
  Other Payables                               1,454               1,310
                                             -------             -------
 Bank Loans                                        -                   -
                                             -------             -------
Other Liabilities and Equity - Closing
 Accounts                                      2,548               8,908
                                             -------             -------
 Accrual Accounts                                702               3,290
                                             -------             -------
  Accrued Expenses                               667               3,185
  Unearned Revenue                                35                 105
                                             -------             -------
 Contingencies and Estimated Accrued Items
 (Credit Balance)                              1,846               5,618





                             TEPLARNA LIBEREC, a.s.
                     FINANCIAL STATEMENTS - INCOME STATEMENT



                                            12/31/99           12/31/98
                                            --------           --------
                                                    (CZK 000's)


Revenue (From Sale of Merchandise)               154              3,052
 Cost of Goods Sold (Merchandise)                154              2,897
                                             -------            -------
 Gross Profit on Merchandise Sold (A)              -                155
                                             -------            -------
Revenue (From Sale of Manufactured
 Goods) (B)                                  564,409            589,927
                                             -------            -------
 Revenue (From Sale of Manufactured
  Goods and/or Services)                     564,355            589,848
 Self-Constructed Asset Revenue                   54                 79
                                             -------            -------
Cost of Materials Used in Manufacturing (C)  474,495            495,743
                                             -------            -------
 Raw Materials and Utilities Used            284,859            305,053
 Services Used                               189,636            190,690
                                             -------            -------
Gross Profit on Sales (A)+(B)-(C)             89,914             94,339
                                             -------            -------
Payroll                                       47,041             46,800
                                             -------            -------
 Wages and Salaries                           32,917             32,987
 Board Member Fees and Bonuses                   820                568
 Social Security Expenses                     11,449             11,445
 Fringe Benefits                               1,855              1,800
                                             -------            -------
Taxes and Fees                                    62                 33
Amortization of Intangible and
 Depreciation of Tangible Fixed Assets        29,900             27,992
Moneys Received From Sale of Fixed
 Assets and Raw Materials (+)                    152                503
Net Book Value of Disposed Fixed
 Assets or Raw Materials (-)                     354                331
Clearing of Reserves & Accrued Revenue (+)     4,779              3,854
Creation of Reserves & Accrued Expenses (-)    9,707             12,779
Clearing of Gains on Assets to Operating
 Revenue (+)                                     989              2,699
Clearing of Losses on Assets to Operating
 Expense (-)                                   2,950              2,215
Other Operating Gains (Revenues)(+)            4,408              2,870
Other Operating Expenses (-)                   9,721              3,860
                                             -------            -------
Operating Income (D)                             507             10,255
                                             -------            -------
Moneys Received From Sale of Securities
 Or Direct Investments (+)                         -                  -
Cost (Purchase Price) of Securities and
 Direct Investments Sold (-)                       -                  -
Gains on Investments (+)                           2                 38
Revenues from Short-Term Financial Assets (+)  3,715                 32
Interest Income (+)                            2,360             11,342
Interest Expense (-)                             161              1,015
Other Gains on Investments (+)                     -                  -
Other Expenses on Investments (-)                142              2,306
                                             -------            -------
Profit/loss From Financial Operations (E)      5,774              8,091
                                             -------            -------
Income Tax (F)                                 4,496              9,794
                                             -------            -------
 Payable                                       2,061              9,524
 Deferred                                      2,435                270
                                             -------            -------
Income From Operations (D)+(E)-(F)=(G)         1,785              8,552
                                             -------            -------
Unusual and/or Extraordinary Gain/Income (+)   1,355              1,089
Unusual and/or Extraordinary
 Loss/Expenses (-)                               183              1,793
                                             -------            -------
Unusual Profit/Loss (H)                        1,172               (704)
                                             -------            -------
Net Income/Loss for Fiscal Period (G)+(H)      2,957              7,848
                                             =======            =======
Income Before Tax                              7,453             17,642
                                             =======            =======



                                    CASH FLOW



                                                      12/31/99      12/31/98
                                                      --------      --------

Cash and Cash Equivalents at the Beginning
 of the Accounting Period (A)                           66,722        54,886
                                                       -------       -------
Profit/Loss From Normal Activity Before Taxes (B)        6,281        18,346
                                                       -------       -------
Adjustments by Non-Cash Transactions (C)                30,207        32,551
                                                       -------       -------
 Depreciation of Fixed Assets                           30,701        29,142
 Change in Provisions, Reserves and Change in
  Prepayments and Accruals                               1,449        13,777
  (Profit) Loss From Sale of Fixed Assets                  256           (41)
 Interest Expense                                       (2,199)      (10,327)
Net Cash Flow From Operational Activity Before
 Taxes and Before Changes in Working Capital and
                                                       -------       -------
 Extraordinary Items (B)+(C)=(D)                        36,488        50,897
                                                       -------       -------
Change in Working Capital (E)                           23,225       (15,533)
                                                       -------       -------
 Change in Receivables From Operational Activities       1,613        12,183
 Change in Short-Term Payables From Operational
  Activities                                            19,410       (33,202)
 Change in Inventories Balance                           5,428         5,486
                                                       -------       -------
Net Cash Flow From Operational Activity Before
 Taxes and Extraordinary Items (D)+(E)=(F)              59,713        35,364
                                                       -------       -------
Interest Paid (G)                                         (161)         (947)
Interest Received (H)                                    2,360        11,342
Tax on Normal Activity and Additional Tax of
 Prior Years (I)                                        (6,506)       (1,782)
Revenues and Expenses Related to Extraordinary
 Items (J)                                                 291          (704)
                                                       -------       -------
Net Cash Flow From Operational
 Activity (F)+(G)+(H)+(I)+(J)=(K)                       55,697        43,273
                                                       -------       -------
Fixed Asset Acquisition                                (37,363)      (28,840)
Sale of Fixed Assets                                        80           331
                                                       -------       -------
Net Cash Flow From Investment Activity (L)             (37,283)      (28,509)
                                                       -------       -------
Change in Long-Term and Short-Term Liabilities          (5,155)       (2,578)
Paid-Out Dividends and Profit Shares                      (350)         (350)
                                                       -------       -------
Net Cash Flow From Financial Activity (M)               (5,505)       (2,928)
                                                       -------       -------
Net Increase/Decrease in Cash (K)+(L)+(M)=(N)           12,909        11,836
                                                       -------       -------
Cash and Cash Equivalents at the End of the
 Accounting Period (A)+(N)                              79,631        66,722
                                                       =======       =======

EX-99

Auditor's Report

1.       AUDITED COMPANY
         ---------------

         Prvni severozapadni teplarenska
         stock corporation
         Komorany u Mostu
         Company Identification Number:  46708197

2.       PERIOD OF THE FINANCIAL STATEMENT
         ---------------------------------

         The  period of 1 January 1999 to 31 December 1999 was audited.

3.       SUBJECT AND PURPOSE OF THE AUDIT
         --------------------------------

         We audited 1999 financial statements and the 1999 Annual Report.

         The purpose of our audit is to find out:

         -    whether the data in the financial statements and the Annual Report
              give  a  true  and  fair  view  of  the  assets  and  liabilities,
              difference between the assets and liabilities,  financial position
              and results of the financial results;

         -    whether  the  accounting  records  are  maintained  in a complete,
              supportable and correct way;

         -    whether the annex to the financial statements includes information
              demonstrating  important events that occurred in the period of the
              financial  statement  date to the  compilation  of this report and
              information  on an  assumption  of an  indefinite  duration of the
              accounting unit if it is jeopardized in any manner.

         The  stocktaking  systems of tangible and intangible  fixed assets were
         examined as far as documentation of their results is concerned.  At the
         same  time,  the  stocktaking  process  itself  and the  system  of the
         stocktaking  organization  were  reviewed  through  a  direct  check of
         selected items.


4.       RESPONSIBILITY DEFINITION
         -------------------------

         The statutory body of the audited  company is  responsible  for keeping
         complete,  supportable and correct accounting  records.  The auditor is
         obliged to draw up a report based on the conducted audit and to express
         his opinion as to the company financial  statements.  The auditor shall
         verify information proving data in the financial statements.

         We conducted our audit in  accordance  with the Act on Auditors and the
         Chamber of Auditors of the Czech  Republic and the auditing  guidelines
         issued by the Chamber of Auditors.

         With regard to the nature of the financial  statements,  we planned and
         executed our audit to obtain  reasonable  assurance  about  whether the
         financial statements are free of material  misstatements whether caused
         by mistake, deliberately or on different grounds.

         The  audit  is  conducted  on a test  basis  and in  accordance  with a
         principle  of the  accounting  data  significance and is  focused  on a
         verification  of completeness  and conclusive  evidence of the data and
         information  in  the  financial  statements,  the  correctness  of  the
         financial  statement  operations and the  adequateness  of the  applied
         accounting  methods.  The auditor also reviews important  estimates and
         decisions of the accounting  unit management that have an impact on the
         financial statements and its whole presentation.

         Our audit  provides a reasonable  basis for our opinion  regarding  the
         financial statements.

5.       AUDITOR'S STATEMENT
         -------------------

         We have  undertaken an audit of the 1999  financial  statements and the
         1999  Annual  Report,  and the  found-out  data  allow  us to make  the
         following conclusion:

         In our opinion,  the financial  statements of the audited  company were
         drawn  up in the  prescribed  extent  and on the  basis  of data in the
         accounting that is kept in accordance with valid laws and regulations.

         The  audited  financial  statements,  in all their  essential  aspects,
         present fairly the assets, liabilities,  equity as to 31 December 1999,
         the financial  position and economic results of the company in the said
         period in  accordance  with the  relevant  legislation.  That is why we
         issue this statement

                       w i t h o u t     q u a l i f i c a t i o n s.

Most, March 24, 2000

Audited by:                  MK Audit, v.o.s.
                             auditor - license No. 113

                             Statutory auditor
                             Ing. Rudolf Mrnka









                                      PSZT
                                  BALANCE SHEET

                                                        12/31/1999           12/31/1998
                                                        ----------           ----------

                                                                   (CZK 000's)
                                                        ---------------------------------
                                                                        

Total Assets                                             5,369,011            5,033,764

         Stock Subscriptions
           Receivable                                            -                    -

         Intangible and Tangible
           Assets and Investments                        4,840,790            4,641,214

         Intangible Assets                                     325                  887
         Tangible Assets                                 4,840,339            4,640,207
         Financial Investment                                  126                  120

         Current Assets                                    441,740              390,574

         Inventory                                          69,124               56,244
         Long-term Receivables                                 175                  175
         Short-term Receivables                            166,633              296,402
         Financial Accounts                                205,808               37,753

         Other Assets                                       86,481                1,976

         Temporary Accounts of Assets                       86,274                1,930
         Contingencies - Gain                                  207                   46

Total Shareholders' Equity and
  Liabilities                                            5,369,011            5,033,764

         Shareholders' equity                            2,374,145            2,237,283

         Registered Capital                              1,006,309            1,006,309
         Capital Funds                                         169                  169
         Funds Created From Profit                         160,952              142,667
         Retained Earnings                               1,067,855              733,146
         Profit and Loss of
          Current Accounting Period                        138,860              354,992

         Liabilities                                     2,973,985            2,766,333

         Reserves                                           43,228               82,635
         Long-term Liabilities                                   -              300,000
         Short-term Liabilities                          1,334,833              787,774
         Bank Loans and Short-term
          Notes                                          1,595,924            1,595,924


     Other Liabilities -
         Temporary Accounts of
         Liabilities                                        20,881               30,148

         Accruals                                                -               22,544
         Contingencies-Loss                                 20,881                7,604









                                      PSZT
                            PROFIT AND LOSS STATEMENT

                                                                  12/31/1999                  12/31/1998
                                                                  ----------                  ----------

                                                                               (CZK 000's)
                                                                  --------------------------------------
                                                                                          

         Operation                                                2,247,940                      2,204,769
          Revenues from Finished Products
           and Services                                           2,247,192                      2,204,300
          Capitalization                                                748                            469
         Consumption from Operation                               1,446,426                      1,050,771

         Value Added                                                801,514                      1,153,998

         Personnel Expenses (-)                                     147,837                        151,416
         Taxes and Fees (-)                                           1,197                          1,076
         Amortization of Intangibles and
          Depreciation of Tangibles (-)                             244,136                        206,700
         Revenues from Intang. and Tang.
          Assets and Materials Sold (+)                              52,202                         58,519
         Net Book Value of Intangibles,
          Tangibles and Material Sold (-)                            43,045                         48,019
         Reversal of Reserves and Prepaid
          Expenses (+)                                               38,964                         86,916
         Creation of Reserves and Prepaid
          Expenses (-)                                                    -                         17,584
         Reversal of Provisions (+)                                     525                         15,237
         Creation of Provisions (-)                                   1,142                         10,577
         Other Operational Revenues (+)                                 100                          2,021
         Other Operational Expenses (-)                              65,977                        411,321

         Net Operating Results (A)                                  389,971                        469,998

         Reversal of Financial Reserves (+)                             443                         71,879
         Creation of Financial Reserves (-)                               -                       (115,115)
         Interest Revenues (+)                                       16,667                          4,227
         Interest Expenses (-)                                      187,462                        163,068
         Other Financial Revenues (+)                                 5,840                        130,811
         Other Financial Expenses (-)                                 1,136                        228,384

         Net Result from Financial
          Activities (B)                                           (165,648)                       (69,420)

         Income Taxes on Normal Activity (C)                         89,175                         45,988

         Net Result After Taxes from
          Normal Activities (A+B-C=D)                               135,148                        354,590

         Extraordinary Revenues (+)                                   4,010                          1,652
         Extraordinary Expenses (-)                                     298                          1,250
         Income Tax on Extraordinary
          Activity (-)                                                    -                              -

         Net Result from Extraordinary
          Activities (E)                                              3,712                            402

         Net Income (Net Loss) for the
          Accounting Period (D+E)                                   138,860                        354,992









                                      PSZT

                                    CASH FLOW

                                                         December 31, 1999
                                                         -----------------

Cash and Cash Equivalents at the Beginning
  of the Accounting Period (A)                              37,753,081.21

Profit/Loss from Normal Activity Before Taxes (B)          224,323,571.27

Adjustments by Non-cash Transactions (C)                   282,158,485.09
  Depreciation of Fixed Assets (+)                         244,573,431.95
  Change in Provisions, Reserves and Change in
    Prepayments and Accruals                              (132,591,434.06)
  (Profit) Loss from Sale of Fixed Assets (+/-)               (618,484.27)
  Interest Expense (+)                                     170,794,971.47

Net Cash Flow from Operational Activity Before
  Taxes and Before Changes in Working Capital
  and Extraordinary Items (B+C=D)                          506,482,056.36

Change in Working Capital (E)                               62,246,877.27
  Change in Receivables from Operational Activities (+/-)  135,445,814.90
  Change in Short-term Payables from Operational
    Activities (+/-)                                       (59,418,352.28)
  Change in Inventories Balance (+/-)                      (13,780,585.35)

Net Cash Flow from Operational Activity Before
  Taxes and Extraordinary Items (D+E=F)                    568,728,933.63

Interest Paid (-)                                         (187,462,063.82)
Interest Received (+)                                       16,667,092.35
Revenues and Expenses Related to Extraordinary Items         3,712,044.90

Net Cash Flow from Operational Activity (G)                401,646,007.06

Fixed Asset Acquisition                                   (444,103,271.88)
Sale of Fixed Assets                                           997,605.20
Net Cash Flow from Investment Activity (H)                (444,105,666.68)

Change in Long-term and Short-term Liabilities             211,513,400.00
Impact of Changes in Equity                                 (1,998,956.06)
  Direct Payments Debited to Funds (-)                      (1,818,956.06)
  Paid-out Dividends and Profit Shares (-)                    (180,000.00)
Dividends and Profit Shares Received (+)                                -

Net Cash Flow from Financial Activity (I)                  209,514,443.94

Net Increase/Decrease in Cash (G+H+I=J)                    168,054,784.32

Cash and Cash Equivalents at the End of the
  Accounting Period (A+J)                                  205,807,865.53

EX-99

  Auditor's report on audit of financial statements of Teplarna Kromeriz, a.s.

     The  1999  financial  statements  of  Teplarna  Kromeriz,  a.s.,  with  its
registered  office at  Kromeriz,  Na Sadkach  3572,  were audited due to a legal
obligation to provide financial statements audited by an auditor.

     The  ordinary  financial  statements  prepared as to 31 December  1999 were
subject to the audit  pursuant  to Section 14  Subsections  1 and 2 of the Czech
National Council's Act No. 524/1992 Coll.

In our audit, we paid attention to:

- -    a checkout of the balance sheet continuity;

- -    a checkout  of linking of  balances  on  synthetic  accounts to the balance
     sheet and the profit and loss  statement.  This checkout was carried out in
     Microsoft Excel.  After balances of synthetic  accounts had been taken over
     and control statements had been made, no differences were found out.

- -    the system of accounting  procedures and internal audit in 1999 with regard
     to  methodological  and technical  approaches and the compliance with valid
     regulations,  particularly  with  the Act  563/1991  Coll.,  on  Accounting
     Procedures,  and with the ruling of the Federal  Ministry of Finance,  reg.
     No.  V/20-100/1992,  on Account  Classification  and Accounting methods for
     Entrepreneurs, as amended;

- -    a survey  of  balances  discovered  in the  Company's  accounting  as of 31
     December  1999 on accounts of the  Company's  assets and on accounts of its
     liabilities and shareholders' capital;

- -    an evaluation of events that occurred after the financial  statements  date
     and that could have an impact on our auditor's report.

     We conducted  our audit in  accordance  with the  guidelines  issued by the
Chamber  of  Auditors  of  the  Czech  Republic,  and/or  with  requirements  of
international  auditing  standards  ensuring  from  the  responsibility  of  the
Company's  statutory  bodies  for  keeping  complete,  supportable  and  correct
accounting  records,  and  from the  obligation  to have  data in the  financial
statements  audited on a test basis and using the  principles  of  significance.
Accounting documents related to accounting records were audited on a test basis.
No extraordinary survey of any assets was necessary.

     Based on the results of the applied auditing  methods,  we did not find out
any significant  errors or discrepancies  with valid laws and  regulations.  The
carried-out audit entitles us reasonably to issue this statement:

     In our opinion, the financial  statements,  in all their essential aspects,
present  fairly the assets,  liabilities,  equity and the financial  position of
Teplarna Kromeriz, a.s., as to 31 December 1999, and its economic results in the
accounting  period  1999 in  accordance  with  the Act No.  563/1991  Coll.,  on
Accounting, and with respective regulations.


                                             Signature

Bystrice pod Hostynem, June 14, 2000

On behalf of Muller - audit, spol. s.r.o., license No. KACR 140

Ing. Jiri Muller, auditor, decree No. 527, the executive of the company







                            Profit and Loss Statement
                               In its full extent
                             As to December 31, 1999
                      (in whole thousands of Czech crowns)


                                                                   1999                      1998
                                                                   ----                      ----
                                                                                     

Income from sale of goods                                             -                        -
Costs expended on goods sold                                          -                        -
                                                                 ------                   ------
Trade margin                                                          -                        -

Performances                                                     44,215                   53,879
                                                                 ------                   ------
  Income from sale of own products and
    services                                                     44,215                   53,879

Output Consumption                                               42,153                   45,975
                                                                 ------                   ------
  Consumption of material and power                              33,836                   42,960
  Services                                                        8,317                    3,015
                                                                 ------                   ------
Value added                                                       2,062                    7,904

Personal expenses                                                 4,565                    4,997
                                                                 ------                   ------
  Wages expenses                                                  3,381                    3,692
  Expenditure on social security                                  1,184                    1,305

Taxes and payments (-)                                            1,128                       47

Deductions on intangible and tangible
  fixed assets (-)                                                1,444                    1,209
Income from sale of fixed assets and
  Materials (+)                                                       -                      130
Accounting of corrective items in
  operative yields (+)                                              129                      129

Accounting of corrective items in
  operative costs (-)                                                 -                        -
Other operative yields (+)                                           37                       47
Other operative costs (-)                                           126                      516
Operative economic result (A)                                    (5,035)                   1,441

Interest revenues (+)                                               156                      139
Interest expenses (-)                                               103                    1,290
Other financial revenues (+)                                          -                       29
Other financial expenses (-)                                        133                      145

Net result from financial activities (B)                            (80)                  (1,267)

Income taxes on normal activity                                       -                        -
    - due                                                             -                        -
    - deferred                                                        -                        -

Net result after taxes from normal activity
  (A+B =C)                                                       (5,115)                     174

Extraordinary revenues                                                -                      310
Extraordinary expenses                                                -                        -
Income tax on extraordinary activity                                  -                        -
    - due                                                             -                        -
    - deferred                                                        -                        -

Net result from extraordinary activities (D)                        310                      310

Net income (net loss) for the accounting
  Period (C + D)                                                 (5,115)                     484









                                  BALANCE SHEET
                               In its full extent
                             As of December 31, 1999
                      (in whole thousands of Czech crowns)


                                                                   1999                      1998
                                                                   ----                      ----
                                                                                     

ASSETS

Total Assets                                                     44,273                    43,782
                                                                 ======                    ======

  Intangible and Tangible Assets and
    Investments                                                  28,973                    30,288
                                                                 ------                    ------
    Intangible inv. Assets                                            6                         9

    Tangible assets                                              28,967                    30,279
                                                                 ------                    ------
      Land                                                        1,321                     1,321
      Buildings, halls and constructions                         15,228                    15,932
      Separate movable items and sets of
        mov. It.                                                  4,967                     5,704
      Incomplete tangible investments                             8,742                     8,742
      Corrective item for acquired property                      (1,291)                   (1,420)

Current Assets                                                   15,269                    13,464
                                                                 ------                    ------
    Trade Receivables                                            12,313                    10,824
    Receivables from Taxes and Subsidiaries                       1,186                     1,763
    Other Receivables                                                 5                        17
    Cash                                                            162                        74
    Bank Accounts                                                 1,560                       786
    Short-Term Financial Assets                                       -                         -

Other Assets                                                         31                        30
                                                                 ------                    ------
    Temporary Accounts of Assets                                     31                        27
    Contingencies - Gain                                              -                         3

TOTAL LIABILITIES AND CAPITAL                                    44,273                    43,782
                                                                 ======                    ======

  Own capital                                                      (542)                    4,573
                                                                 ------                    ------
    Basic capital                                                17,487                    17,487
    Capital funds                                                     -                         -
    Economic result of past years                               (12,914)                  (13,398)
    Economic result of current acc. period                       (5,115)                      484

  Liabilities                                                    44,734                    39,169
                                                                 ------                    ------
  Short-term liabilities                                         41,334                    35,544
                                                                 ------                    ------
      Trade payables                                              9,153                     7,357
      Payables to employees                                          82                       241
      Social security payable                                       310                       171
      Taxes payable                                                 115                        44
      Payables to related companies
        (shareholdings less than 50%)                            31,666                    27,729
      Other payables                                                  8                         2

    Bank loans and short-term notes                               3,400                     3,625
                                                                 ------                    ------
      Long-term bank loans                                        3,400                     3,625
      Short-term bank loans                                           -                         -

  Other liabilities - temporary accounts of
    liabilities                                                      81                        40
                                                                 ------                    ------
    Contingencies - loss                                             10                        40






                            Teplarna Kromeriz, a.s.
                              CASH FLOW STATEMENT
                      For the year ended 31 December 1999

                                                                            1999
                                                                            ----

                                                                   
Cash and cash equivalents at the beginning of the accounting period        860,136.04
                                                                         ------------
Cash flow from main (operational) activity

Profit/loss from normal activity before taxes                           (5,114,812.04)
                                                                         ------------

Adjustments by non-cash transactions                                     1,431,128.76
  Depreciation of fixed assets                                           1,444,104.30
  Change in provisions, reserves and change in
    prepayments and accruals                                                39,929.13
  (Profit) loss from sale of fixed assets                                           -
  Dividends and profit revenues                                                     -
  Interest Expense                                                         (52,904.67)

Net cash flow from operational activity before taxes and
  before changes in working capital and extraordinary items             (3,683,683.28)
                                                                         ------------

Change in working capital                                                4,497,840.94

  Change in receivables from operational activities                       (936,292.56)
  Change in short-term payables from operational activities              5,434,133.50
  Change in inventories balance                                                     -

Net cash flow from operational activity before taxes
  and extraordinary items                                                  814,157.66
                                                                        ------------

Interest paid                                                               28,528.54
Interest received                                                           38,444.13
Tax on normal activity and additional tax of prior years                    (4,352.00)
Revenues and expenses related to extraordinary items                        16,140.00

Net cash flow from operational activity                                    892,918.33
                                                                         ------------

Cash flow from investment activity

  Fixed asset acquisition                                                    6,612.16
  Sale of fixed assets                                                              -
  Loans to related parties                                                          -

Net cash flow from investment activity                                       6,612.16
                                                                         ------------
Cash flow from financial activity

Change in long-term and short-term liabilities                                      -

Impact of changes in equity                                                         -
  Capital and reserve fund increase                                                 -
  Refund of equity to shareholders                                                  -
  Monetary donations and subsidies to equity and other cash
    contributions of partners and shareholders                                      -
  Settling of loss by shareholders                                                  -
  Direct payments debited to funds                                                  -
  Paid-out dividends and profit shares                                              -

Dividends and profit shares received                                                -

Net cash flow from financial activity                                               -
                                                                         ------------

Net increase/decrease in cash                                              899,530.49
                                                                         ------------

Cash and cash equivalents at the end of the accounting period            1,759,666.53
                                                                         ------------