AMENDMENT TO RIGHTS AGREEMENT


                  Amendment, dated as of June 4, 1999 (the "Amendment"), between
PENNSYLVANIA  ENTERPRISES,  INC. (the  "Company"),  and ChaseMellon  Shareholder
Services,  L.L.C.  (as successor to Chemical Bank), as Rights Agent (the "Rights
Agent").

                  WHEREAS,  the  Company  and the Rights  Agent  entered  into a
Rights Agreement, dated as of April 26, 1995 (the "Rights Agreement");

                  WHEREAS, there is not as of the date hereof any Acquiring
Person (as defined in the Rights Agreement); and

                  WHEREAS, the Company desires to amend the Rights Agreement in
 accordance with Section 28;

                  NOW,  THEREFORE,  in  consideration of the premises and mutual
agreements  set forth in the Rights  Agreement and this  Amendment,  the parties
hereby agree as follows:

                  Section 1.  Amendment to  Definition  of  "Acquiring  Person."
Section 1(a) of the Rights  Agreement is amended to add the  following  sentence
after  the  last  sentence  thereof:  "Notwithstanding  the  foregoing,  neither
Southern Union Company  ("Southern")  nor any of its Affiliates  shall become an
Acquiring  Person as a result of (i) the  execution of the  Agreement of Merger,
dated as of June 7, 1999  between  Southern  and the Company (as the same may be
amended from time to time, the "Merger  Agreement") or the  consummation  of the
transactions  contemplated  thereby or (ii) any  mergers  between  Southern  and
subsidiaries of the Company contemplated by the Merger Agreement."

                  Section 2.  Amendment  to Section  7(a).  Section  7(a) of the
Rights  Agreement  is amended by deleting  the word "or"  immediately  preceding
clause (iii) and replacing such word with "," and by adding the following at the
end of clause (iii): "or (iv) such time as a certificate of merger is duly filed
with the  Secretary of State of the State of Delaware and articles of merger and
plan of merger are duly filed with the Secretary of State of the Commonwealth of
Pennsylvania  pursuant to Section 2.2 of the Merger  Agreement  or at such later
effective time as is specified in such documents."

                  Section 3.  Amendment to Section  13(a).  Section 13(a) of the
Rights  Agreement  is amended to add the  following  sentence  at the end of the
section:  "Notwithstanding  the foregoing,  the provisions of this Section 13(a)
shall not apply to the execution of the Merger  Agreement or the consummation of
the transactions contemplated thereby."

                  Section 4. Rights  Agreement as Amended.  The term "Agreement"
as used in the Rights Agreement shall be deemed to refer to the Rights Agreement
as amended hereby.  The foregoing  amendments  shall be effective as of the date
hereof and,  except as set forth herein,  the Rights  Agreement  shall remain in
full force and effect and shall be otherwise unaffected hereby.

                  Section 5. Counterparts. This Amendment may be executed in any
number of counterparts,  and each of such counterparts shall for all purposes be
deemed an original,  but all such counterparts shall together constitute but one
and the same instrument.

                  Section 6. Governing Law. This Amendment shall be deemed to be
a contract made under the laws of the  Commonwealth of Pennsylvania  and for all
purposes shall be governed by and construed in accordance  with the laws of such
Commonwealth  applicable to contracts made and to be performed  entirely  within
such Commonwealth.

                  Section 7.  Descriptive Headings.  Descriptive headings of the
several Sections of the Amendment are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.



                  IN WITNESS  WHEREOF,  the  parties  hereto  have  caused  this
Amendment to be duly executed as of the day and year first above written.


Attest:                                PENNSYLVANIA ENTERPRISES, INC.


      /s/ Donna M. Abdalla             By:    /s/ Thomas F. Karam
Name:     Donna M. Abdalla             Name:      Thomas F. Karam
Title:    Secretary                    Title:     President and CEO

Attest:                                CHASEMELLON SHAREHOLDER
                                           SERVICES, L.L.C., as Rights Agent


      /s/ Marilyn Spisak                      /s/ Kathryn M. Gallagher
Name:     Marilyn Spisak               Name:      Kathryn M. Gallagher
Title:    Vice President               Title:     Vice President