Media contact:  Sam Wilson, (319)326-7278
Investor relations contact:  Lance Cooper,(319)326-7313


                           Monday, Jan. 30, 1995
  
     DAVENPORT, IOWA -- Iowa-Illinois Gas and Electric Company
and Midwest Resources Inc. today announced plans to reduce their
combined work forces by a total of approximately 15 percent in
conjunction with development of a restructured organization to be
effective at the completion of their merger.  The merger,
expected by mid-year, forms MidAmerican Energy Company.
     At the time of the merger announcement in July 1994, a
reduction of about 250 positions was identified related to
elimination of duplicate positions.
     The additional 400 positions recently targeted bring the
total to approximately 650 salaried and union personnel and will
help position MidAmerican as a low-cost provider in the utility
industry.  "The targets we are setting are based upon industry
measures of the top quartile performance for all company
functions," said Russell E. Christiansen, chairman and chief
executive officer of Midwest Resources.  
     The two companies took the first step to reduce the work
forces last summer when they imposed a hiring freeze, which to
date has already reduced employment by about 100 positions
through normal attrition.
     "For MidAmerican to be a top industry performer in the more
competitive utility environment, employment reductions are
necessary," said Christiansen.  "As detailed planning for the new
organization progresses, we expect to develop a new, more
competitive entity with additional efficiencies and services in
place."
     As part of these staff reductions, the companies today
announced an incentive retirement program.  Salaried employees
who will be at least age 55 and have 10 or more years of service
by the end of 1995 are eligible.  Of the 4,200 current full-time
employees of the two companies, as many as 270 salaried employees
will qualify.  Response to the retirement program will determine
what additional reductions may be necessary.
     A new organization is being created for MidAmerican. 
Positions in that organization will be filled through an open
application process.  Employees will apply for positions, which
will be filled based on a match of the position requirements and
employee qualifications.  The two companies have developed a
severance program for those employees who cannot be placed in
jobs within MidAmerican.
     "In the long term, we must develop the strongest, most
competitive organization possible; however, we must also be fair
with employees who leave voluntarily or through severance," said
Stanley J. Bright, chairman and chief executive officer of Iowa-
Illinois.  "Our concern for employees is reflected in the
benefits and opportunities available in the incentive retirement
plan, the open application process and the relocation and
severance packages."
     The companies estimate the incentive retirement program and
severance program will reduce 1995 after-tax earnings of
MidAmerican by approximately $9 million, or 9 cents a share, if
the merger is consummated this year.
     "We believe these actions are necessary for MidAmerican to
successfully compete and provide both customer and shareholder
value in the future," said Bright.  The present value of the net
savings from employment reductions is estimated to be
approximately $230 million.
     On July 27, 1994, Midwest Resources and Iowa-Illinois
announced their intent to merge and create MidAmerican. 
Shareholders of the two companies approved the merger on Dec. 21,
1994.
     The Iowa Utilities Board (IUB), on Jan. 25, 1995, allowed
the merger to go forward.  Nancy Shimanek Boyd, acting
chairperson of the IUB, stated, "There is every reason to believe
this is a positive step for Iowa's rate payers and the state as a
whole."
     The merger still must receive approvals from the Illinois
Commerce Commission and the Federal Energy Regulatory Commission.
In addition, Iowa-Illinois must also receive approval from the
Nuclear Regulatory Commission to transfer the license for the
Quad-Cities Nuclear Power Station.  Iowa-Illinois owns 25 percent
of the plant.
     Iowa-Illinois, headquartered in Davenport, Iowa, has assets
of $1.85 billion.  The utility provides electric service to a
population exceeding 600,000 in central and eastern Iowa and
western Illinois.  The company's non-regulated subsidiary,
InterCoast Energy Company, has more than $520 million of assets
in three major businesses:  oil and natural gas; energy services;
and financial investments.
     Midwest Resources, with assets of $2.6 billion, provides
natural gas and electric service to a population exceeding 1
million in Iowa, Nebraska and South Dakota.  A subsidiary,
Midwest Capital Group Inc., has non-regulated investments.

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