Contract Restructuring Letter Agreement

LOGO] TENNESSEE
GAS PIPELINE
an El Paso Energy company
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EXHIBIT 10.49


August 27, 1999


Colonial Gas Company 40 Market Street Lowell, MA 01853-3064


Attention: Mr. Nickolas Stavropoulos via facsimile: (617) 742-0041


RE: CONTRACT RESTRUCTURING LETTER AGREEMENT


Dear Nick:


This Contract Restructuring Letter Agreement ("Letter Agreement") is entered into between Tennessee Gas Pipeline Company ("Tennessee") and Colonial Gas Company ("Colonial"). Whereas, Tennessee and Colonial (being hereinafter individually referred to as a "Party" and collectively referred to as the "Parties"), have agreed upon the terms and conditions under which to extend and amend certain Firm Transportation and Storage Service Agreements ("Firm Agreements") to restructure the firm services received by Colonial from Tennessee (hereinafter referred to as "Contract Restructuring"). The Parties wish to proceed with the Contract Restructuring based on the following terms and principles subject to the execution and regulatory approval of final agreements effectuating the provisions described herein.


1. Primary Point Amendment


Subject to Colonial's participation in an open season to change primary
points in accordance with Article XXVIII, Section 5.7 of the General Terms
and Conditions of Tennessee's FERC Gas Tariff, Tennessee shall allow
Colonial to amend the Firm Agreements identified below to effectuate a
change in primary receipt points from meters located in Zones 00, 0L, and
01 to meter number 07-0018, Tennessee's Northern Storage Withdrawal
(located in Tennessee's Zone 4) to be effective on November 1, 1999;
provided, however, Colonial's rights shall be limited in accordance with
the quantity limitations detailed in Appendix A attached hereto. The
reduction of primary firm receipt meter TQ by the applicable percentages
and resulting quantities from the current primary receipt points in Zones
00, 0L, and 01 shall be implemented pro-rata across the Firm Agreements
identified below at all affected meters. Thus, the currently existing
Zones 00, 0L, and 01 primary receipt points by Firm Agreement shall each
be reduced individually by the applicable amendment percentage and meter
number 07-0018


Contract Restructuring Letter Agreement August 27, 1999 Page 2


shall be increased by the like quantity so that the receipt quantity of
each Firm Agreement is thereby preserved.


In consideration of the merger of Colonial with Eastern Enterprises, Essex
County Gas Company's ("Essex") parent company, Colonial's rights to amend
the Firm Agreements identified below to effectuate a change in primary
receipt points from meters located in Zones 00, 0L, and 01 to meter number
07-0018, Tennessee's Northern Storage Withdrawal (located in Tennessee's
Zone 4) to be effective on November 1, 1999 shall be enlarged as detailed
in Appendix A subject to an election by Essex by September 30, 1999 to
extend 100% of the current MDQ of FT-A Agreement No. 8518 for a Primary
Extended Term of at least three (3) years.


K# 10/31/2003
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Retain 100% of the Firm Agreements 2025 & 435 15%
(Identified in Item 2 below) and
Essex Retains 100% of FT-A Agreement 8518


Retain 100% of the Firm Agreements 2025 & 435 10%
(Identified in Item 2 below) and
Essex Turns back 100% of FT-A Agreement 8518


Appendix A also details the associated buyout amounts by Firm Agreement.
The buyout amounts outlined in Appendix A are equivalent to 60% of the
effective upstream (Zones 00/01 to 04) annual demand charge multiplied by
the applicable amendment quantity. The buyout payment will be due to
Tennessee prior to October 31, 1999.


2. Term


Subject to Colonial's amendment of the Firm Agreements as described in
Item 1 above, Colonial shall elect to extend 100% of the currently
existing Transportation Quantity ("TQ") or Maximum Storage Quantity
("MSQ"), as applicable, of each of the following Firm Agreements pursuant
to Article III, Section 10.5 of the General Terms and Conditions of
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