AGL Energy Services, Inc.
P.O. Box 4569
Atlanta, Georgia 30302-4569
Telephone (404) 584-9470






                                                   January 9, 1997

Mr. John Hritcko, Jr.
Director
Marketing & Regulatory Affairs
Cove Point LNG Limited Partnership
20 Montchanin Road
Wilmington, Delaware 19807-0020

Re: Letter Agreement Concerning FPS-1 Service Agreement
    between Cove Point LNG Limited Partnership ("Operator") and
    Atlanta Gas Light Company ("Buyer") (the "Service Agreement")

Dear Mr. Hritcko:

Appendix A to the Service  Agreement states that Buyer may terminate the Service
Agreement  at the end of the first  Contract  Year (April 15, 1997) by providing
notice to  Operator  no later  than  ninety  (90) days  prior to April 15,  1997
(January 15, 1997).

As you are  aware,  Buyer is in the  process  of  negotiating  a  transportation
agreement  with  a  transporter  ("Transporter")  to  transport  the  quantities
purchased under the Service Agreement for the period from April 15, 1997 through
the remaining  term of the Service  Agreement.  However,  Buyer does not believe
that such negotiations can be completed and a transportation  agreement executed
by  January  15,  1997.  In  order  to give  Buyer  additional  time to reach an
agreement with  Transporter  that would enable Buyer to continue  purchasing gas
under the Service  Agreement  beyond the first Contract Year, Buyer and Operator
hereby  agree to extend the notice date for  termination  to February  15, 1997.
Accordingly,  Paragraph B of Appendix A to the Service Agreement will be deleted
in its  entirety as of January  10, 1997 and  replaced  with the  following  new
Paragraph B:

   "B. Buyer may terminate this  Agreement  effective as of the end of the first
   Contract  Year (April 15,  1997) by  providing  Notice to Operator of Buyer's
   election to terminate no later than February 15, 1997."






Page 2
Mr. John Hritcko, Jr.
January 9,1997

If the terms set forth  herein  reflect  your  understanding  of our  agreement,
please  execute two (2) copies of this letter  agreement  in the space  provided
below and return one (1) fully executed copy to the undersigned.

COVE POINT LNG                            AGL Energy Services, Inc.
LIMITED PARTNERSHIP                       as agent for ATLANTA GAS LIGHT COMPANY

By:/s/ John Hritcko, Jr.                  By: /S/Michael P. Wingo

Title:Director Marketing & Regulatory     Title: VP - AGL Energy Services, Inc.
      Affairs                             

Date: 1/16/97                             Date: 1/9/97