SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )

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/_/ Preliminary Proxy Statement
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Valley Resources, Inc.
(Name of Registrant as Specified In Its Charter)

Valley Resources, Inc.
(Name of Person(s) Filing Proxy Statement)

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VALLEY RESOURCES, INC.
1595 Mendon Road
Cumberland, Rhode Island 02864-0700

PROXY STATEMENT

The accompanying proxy is solicited on behalf of the Board of Directors of
Valley Resources, Inc., a Rhode Island corporation (the "Corporation"), for use
at the Annual Meeting of the Stockholders of the Corporation to be held at 10:00
a.m. on Tuesday, December 10, 1996, and at any and all adjournments thereof.
This Proxy Statement and the accompanying proxy were first mailed to
stockholders on or about November 5, 1996.

A stockholder who executes a proxy may revoke it at any time before it is
exercised by notifying the Secretary of the Corporation at the above address to
such effect in writing before the Annual Meeting, by filing with the Corporation
a superseding later-dated proxy, or by voting in person at the meeting. All
shares represented by effective proxies will be voted at the Annual Meeting or
any adjournment thereof. If the stockholder gives instructions as to any matter
to be acted upon, the shares will be voted as so specified. If no instructions
are indicated, proxies will be voted for the election of the nominees for
director set forth below.

VOTING STOCK OUTSTANDING AND VOTING RIGHTS

Holders of record of the Corporation's Common Stock, par value of $1 per
share (the "Common Stock"), at the close of business on October 22, 1996 (the
"record date") are entitled to vote at the meeting. On the record date the
Corporation had 4,280,028 shares of Common Stock outstanding. Each stockholder
has one vote per share on each matter voted on at the meeting. A majority of the
outstanding shares will constitute a quorum at the meeting. Abstentions and
broker non-votes are counted for purposes of determining the presence or absence
of a quorum for the transaction of business. Under applicable law, abstentions
and broker non-votes will have no effect on the outcome of the election of
directors.

At the record date the following stockholders were known by the Corporation
to be the beneficial owners of more than 5 percent of the outstanding Common
Stock of the Corporation, being the only class of equity security issued and
outstanding. Unless otherwise stated, the holders have sole voting and
investment power.

Amount of
Name and Address Beneficial Percent
of Beneficial Owner Ownership of Class
- --------------------------------------------------------------------------------

RIEV and Co.
One Boston Place
Boston, MA 02108 227,393 5.3

As of October 22, 1996, the nominees for election as directors, the current
directors, the executive officers named in the Summary Compensation Table below,
and all executive officers and directors as a group owned beneficially Common
Stock of the Corporation in the amount set forth opposite their names (such
ownership being reported to the Corporation by the nominees). Unless otherwise
stated, the holders have sole voting and investment power.

Amount of
Beneficial Percent
Name of Beneficial Owner Ownership of Class
- --------------------------------------------------------------------------------

Ernest N. Agresti 31,528 (1)
Melvin G. Alperin 4,402 (1)
C. Hamilton Davison 323 (1)
Don A. DeAngelis 6,258 (1)
Alfred P. Degen 2,320 (1)
James M. Dillon 1,012 (1)
Jonathan K. Farnum 11,440 (2) (1)
John F. Guthrie, Jr 1,567 (1)
Eleanor M. McMahon 4,218 (3) (1)
Kenneth W. Hogan 7,148 (1)
Charles K. Meunier 9,700 (1)

All Directors and Officers
as a group, including above
(9 Directors and 6 Executive Officers) 94,927 2.2

- -----------------
(1) Ownership amounts to one percent or less.

(2) Includes 7,268 shares held by Mr. Farnum's wife and children to which
he disclaims beneficial ownership.

(3) Shares are held in a living trust of which Dr. McMahon is sole trustee
with sole voting and investment power.

ELECTION OF DIRECTORS

The Articles of Incorporation of the Corporation provide that the Board of
Directors shall be divided into three classes with each class to be as nearly
equal in number as possible, and that one class shall be elected each year for a
term of three years. Accordingly, it is proposed that the three nominees,
Messrs. Agresti, DeAngelis and Dr. McMahon, who are presently directors whose
terms expire at this meeting be elected to serve three-year terms. There are six
other directors whose terms do not expire at this time. In accordance with the
Rhode Island Business Corporation Act, directors are elected by a majority of
votes of the shares represented at the Meeting and entitled to vote thereon.

It is intended that the shares represented by proxy will be voted to elect
the three nominees named below, unless authority to do so has been withheld by
proxy.

Should any of the nominees be unable to serve, the proxy will be voted for
a substitute nominee designated by the Board of Directors. Each of the nominees
has indicated a willingness to serve if elected, and the Board of Directors has
no reason to believe that any nominee will be unavailable.

The nominees for election as directors as well as those directors whose
terms have not expired are named below.

Ernest N. Agresti 66 Director 1975 Retired; Partner in the
(2)(3) law firm of Edwards & Angell,
Providence, Rhode Island,
for more than five years prior
to retirement.

Don A. DeAngelis 57 Director 1976 Vice Chairman and Chief
(2)(3) Executive Officer, Murdock
Webbing Co., Inc., a manu-
facturer of narrow fabric,
Central Falls, Rhode Island.

Eleanor M. McMahon 67 Director 1984 Distinguished Visiting Profes-
(1) sor, A. Alfred Taubman Cen-
ter for Public Policy, Brown
University, Providence,
Rhode Island.
Directors whose terms expire in 1997:

Melvin G. Alperin 60 Director 1979 President, Brewster Industries,
(1)(3) real estate investments,
Pawtucket, Rhode Island.

Alfred P. Degen 49 President, 1994 Chief Executive Officer of
Director and Valley Resources, Inc. since
Chief Executive 1995 March 1995; President,
Officer Valley Resources, Inc. from
July 1994; Executive Vice
President, Philadelphia Gas
Works for more than 5 years
prior to July 1994.

Position First
Held Served
with in the Business Experience
Name Age Corporation Position During Last Five Years
- --------------------------------------------------------------------------------
C. Hamilton Davison 37 Director 1995 President and Chief Executive
(1) Officer of Paramount Cards,
Inc., a designer, manufacturer
and distributor of greeting
cards, Pawtucket, Rhode
Island. Mr. Davison is also
a director of Tufco
Technologies, Inc., a specialty
printer and converter of
custom paper and nonwoven
material.

Directors whose terms expire in 1998:

James M. Dillon 63 Director 1983 Retired; Director of
(1) Development, The
Roman Catholic Diocese,
Bridgeport, Connecticut from
November 1993 to December
1994; First Vice President,
Swiss Bank Corporation,
New York, New York from
April 1992 to November
1993; Senior Vice President,
Bankers Trust Company,
New York, New York from
September 1988 to April
1992.

Jonathan K. Farnum 57 Director 1983 Chairman and President,
(1)(2)(3) Wardwell Braiding Machine
Company, a manufacturer
of special design machinery,
Central Falls, Rhode Island.

John F. Guthrie, Jr. 52 Director 1979 Vice President, The New
(2)(3) England, an insurance and
financial services company,
Boston, Massachusetts.

- ---------------------------
(1) Member, Audit Committee
(2) Member, Compensation Committee
(3) Member, Development Committee

GOVERNANCE OF THE CORPORATION

Under the Articles of Incorporation and Bylaws of the Corporation, the
Corporation is managed under the direction of the Board of Directors and by the
officers to whom authority has been delegated. The Board is charged with the
responsibility of selecting and evaluating senior officers, providing financial
reports to the stockholders and considering other fundamental corporate matters,
including dividends, issuance of stock and major corporate borrowings.

During the fiscal year ended August 31, 1996, the Board met four times.
Each member of the Board of Directors attended at least 75% of the aggregate of
the meetings of the Board and its committees on which they served in that year.

The Board has an Audit Committee consisting of Messrs. Alperin (Chairman),
Davison, Dillon, Farnum and Dr. McMahon. The Committee met four times during the
fiscal year ended August 31, 1996. The Audit Committee of the Board of
Directors, composed solely of directors who are not officers or employees of the
Corporation, meets periodically with management and the Corporation's
independent certified public accountants to discuss their evaluation of internal
accounting controls, the quality of financial reporting and related matters. The
independent auditors have free access to the Audit Committee, without management
present, to discuss the results of their audits. The Audit Committee also
reviews quarterly and annual filings made with the Securities and Exchange
Commission.

The Board has a Compensation Committee consisting of Messrs. DeAngelis
(Chairman), Agresti, Farnum and Guthrie. The Compensation Committee met once
during the fiscal year ended August 31, 1996. The Compensation Committee is
charged with reviewing the salary administration program for management
personnel, implementing the plan for that program and making appropriate
recommendations to the Board of Directors.

The Board has a Development Committee consisting of Messrs. Farnum
(Chairman), Agresti, Alperin, DeAngelis and Guthrie. The Committee met three
times during the fiscal year ended August 31, 1996. The Development Committee
meets periodically with management to discuss and evaluate plans to develop the
overall strategic direction of the Corporation. The Committee makes appropriate
recommendations to the Board regarding these plans.

The Board of Directors has no nominating committee as the Board as a whole
studies the qualifications and recommends to the stockholders the election of
directors of the Corporation. Stockholders may recommend nominees for election
as directors by writing to the President of the Corporation.

All directors, except Mr. Degen, receive an annual retainer fee of $5,000
and a fee of $600 per meeting attended and the members of the Audit,
Compensation and Development Committees of the Board receive a fee of $600 per
meeting attended with the chairman of each committee receiving a fee of $750.

Under a formal plan, directors may elect to defer all or a portion of their fees
earned for services as a director. Under the terms of the plan a director's
deferred election includes a payment schedule specifying the date on which
payment shall begin, which shall not be earlier than the Director's 65th
birthday, nor later than the first day of the month following the date the
Director attains age 70. At August 31, 1996, Messrs. Agresti, Alperin, Dillon,
Farnum and Dr. McMahon had so elected to defer their fees. The Corporation has
adopted a Director's Retirement Plan pursuant to which non- employee directors
who (i) have completed a minimum of 10 years of board service and retire from
the board at or after age 60 or (ii) retire from the board at or after age 70,
are entitled to receive an annual retirement benefit for a 10-year period
following retirement from the Board. The annual retirement benefit equals the
annual director's retainer being paid on the date of retirement from the Board,
with such amount being pro-rated in the case of directors with less than 10
years of service on the date of retirement.

EXECUTIVE OFFICER COMPENSATION

The following tables and notes set forth the compensation provided by the
Corporation to its Chief Executive Officer and the Corporation's other most
highly compensated executive offices (the "Named Officers"), who earned in
excess of $100,000, in fiscal 1996:

SUMMARY COMPENSATION TABLE

Annual Compensation
-------------------
Name and All Other
Principal Position Year Salary Bonus Compensation(1)(2)
- ------------------------------------------------------------------------------------------------------------

Alfred P. Degen 1996 167,447 15,000 4,500
President and 1995 152,500 5,063 1,000
Chief Executive Officer 1994 24,167 -0- -0-

Kenneth W. Hogan 1996 127,976 8,000 -0-
Senior Vice President, 1995 118,667 13,000 -0-
Chief Financial Officer, 1994 111,033 12,500 3,563
and Secretary

Charles K. Meunier 1996 99,763 5,000 1,970
Vice President, 1995 96,403 4,000 2,400
Operations 1994 87,591 4,750 4,848

(1) All full-time nonbargaining employees of Valley Gas Company who have
completed one year of service are eligible to participate in an Employee
Savings Plan. Under this plan, a participating employee may contribute up
to 20% of his base pay, and the Company will contribute each year from
profits an amount equal to at least 50% of the participant's contribution
to a maximum of 2%

of base pay. The plan permits a participant to make
contributions on a pretax basis under Section 401(k) of the Internal
Revenue Code, thereby reducing his taxable compensation. Employer
contributions under this plan in fiscal 1996 for the benefit of executive
officers named above were as follows: Mr. Degen $4,500 in 1996 and $1,000
in 1995; Mr. Meunier $1,970 in 1996, $2,400 in 1995 and $1,982 in 1994.

(2) Includes contributions made by Valley Gas Company to the Employee Stock
Ownership Plan of the Corporation. Contributions to the Plan are based upon
discretionary contributions by the Board of Directors. All participants in
the Employees' Retirement Plan and the Employees' Pension Plan participate
in the Employee Stock Ownership Plan. Contributions made on behalf of
executive officers named above in fiscal 1994 were as follows: $3,563 for
Mr. Hogan and $2,866 for Mr. Meunier. No contributions were made to the
Plan in fiscal 1996 or 1995.
-----------------------

Pension Plan

The Corporation maintains a defined benefit plan (Employees' Retirement
Plan) covering all management and nonbargaining unit employees except the
Corporation's subsidiaries, Morris Merchants, Inc., Bristol & Warren Gas Company
and Alternate Energy Corporation. Covered compensation under the plan includes
only regular salary, excluding any fees, bonuses or other additional types of
compensation. The covered compensation for the most recently available plan year
was $5,679,869.

The Corporation also maintains a supplemental retirement plan for certain
officers of the Corporation, including Messrs. Degen and Hogan. This plan
provides that the officer's retirement payment will approximate 65 percent of
the combination of his final year base salary plus the average of the incentive
compensation paid to the officer over the last three years.

The following table sets forth the annual retirement benefit, using a
straight life annuity, at the normal retirement age of 65, which would accrue
for each year of credited service, using a formula based upon 1 1/2 percent of
final average compensation times years of credited service and reduced by 1
percent of the employee's Social Security benefit multiplied by the number of
years of credited service over the amount of the retirement annuity, at the
indicated rates of compensation, assuming receipt of Social Security benefits of
$1,000 per month. At August 31, 1996, Mr. Degen has one year of credited
service, Mr. Hogan has 19 years and Mr. Meunier has 33 years. Table A sets forth
the annual retirement benefit for participants in the supplemental retirement
plan and Table B sets forth the benefit for all other pension plan participants.

Table A
- -------

Final Year Compensation Average Benefits for Years of
Plus Average of Last Three Credited Service Indicated
Years Incentive Award 15 years 30 years 35 years 40 years
- -----------------------------------------------------------------------------------------------------

$100,000............................... $ 53,000 $ 53,000 $ 53,000 $ 53,000
125,000.............................. 69,250 69,250 69,250 69,250
150,000.............................. 85,500 85,500 85,500 85,500
175,000.............................. 101,750 101,750 101,750 101,750
200,000.............................. 118,000 118,000 118,000 118,000
225,000.............................. 134,250 134,250 134,250 134,250
250,000.............................. 150,500 150,000 150,000 150,000
300,000.............................. 183,000 183,000 183,000 183,000
400,000.............................. 248,000 248,000 248,000 248,000
500,000.............................. 313,000 313,000 313,000 313,000

Table B
- -------

Average Annual Compensation Average Benefits for Years of
for Five Consecutive Highest Credited Service Indicated
of the Last Ten Years 15 years 30 years 35 years 40 years
- -----------------------------------------------------------------------------------------------------

$100,000............................... $20,700 $41,400 $48,300 $55,200
125,000.............................. 26,325 52,650 61,425 70,200
150,000 (1).......................... 31,950 63,900 74,550 85,200

(1) Maximum compensation under the plan.

Termination Agreements
- ----------------------

The Corporation has entered into "termination agreements" with Messrs.
Degen and Hogan, which provide certain benefits to those officers in the event
of certain terminations of employment occurring after a change in control of the
Corporation. A change in control is defined as the acquisition by any person or
group of 20% or more of the voting power of the Corporation's stock or a change
in a majority of the directors during any period of two consecutive years.
Benefits payable in the event of a termination of employment by the Corporation
other than for cause or by the officer for good reason (defined as a reduction
in base salary or vacations, a significant change in duties, a failure by the
Corporation to continue certain benefit plans or relocation) after a change in
control include severance pay equal to 2.99 times base salary in the case of Mr.
Degen and 2.5 times base salary in the case of Mr. Hogan. Severance benefits are

payable for a period of 15 months after a change in control at 2 times base
salary in the case of Mr. Degen and one year's base salary in the case of Mr.
Hogan. The termination agreements also provide for continuation of insurance
benefits and a payment in lieu of continued participation in the Corporation's
retirement plan, in each case measured by the same period of time as would apply
to the termination payment referred to above. The termination agreements are
automatically renewed each year for one year unless cancelled by the
Corporation.

REPORT OF THE COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION DESIGN

The design of the Corporation's executive compensation system is intended
to attract, retain and motivate high quality executives with an individual and
corporate performance-based compensation package that promotes achievement of
both corporate and operating company goals for the benefit of both customers and
stockholders. The program is designed to provide a competitive annual salary,
and through the variable performance elements, act as a mechanism to integrate
the subsidiaries by common performance criteria. The goals defined within the
incentive compensation components of the program act to focus management
attention on annual and long-term business objectives. The Compensation
Committee of the Board of Directors of Valley Resources, Inc. (the "Committee"),
comprised solely of outside directors, is responsible for establishing,
reviewing and administering the compensation plan for executive officers of the
Corporation and its subsidiaries.

The compensation package of each executive officer consists of base salary
and the potential for an annual incentive award. The base salary component is
based primarily upon comparative market-derived compensation data for jobs of
comparable positions and breadth of responsibilities within the utility industry
in New England and nationally. The annual incentive award is based upon the
Corpo- ration's standings among a comparison group of companies in the utility
industry. The comparison companies (the "Peer Group") are those companies used
for measuring the Corporation's performance as set forth below under "Corporate
Performance." For an executive officer to receive the targeted level of
compensation the Corporation must meet certain shareholder and customer value
criteria established by the Committee. This places a portion of the executive
officer's compensation at risk and tied to annual and long-term corporate
performance. The total of the base salary and incentive award is designed to
meet the prevailing market level of compensation for a comparison group of
companies when targeted levels of performance are achieved. When targeted levels
of performance are exceeded the total compensation should surpass the market.

A discussion of the two components of executive officer compensation and
decisions made by the Committee concerning the Named Officers and the Chief
Executive Officer follows.
9

BASE SALARY

The base salary portion of the executive officers' compensation is
market-based and not tied to corporate performance. The objective of the
Committee is to establish a compensation level that approaches the midpoint of a
sample group of companies with similar sales and complexities as the
Corporation. In December 1994 the Committee met to review the data analysis that
had been prepared by an independent compensation consultant to establish the
base salary for calendar 1995 for each of the named officers. For calendar 1996
the base salary of each executive officer was adjusted to reflect changes in the
market after consultation with the consultant. The base salary of the Chief
Executive Officer approximates 86 percent of the comparison group of companies.
The other executive officers approximate 89 percent of the comparison group.

ANNUAL INCENTIVE AWARD

The annual incentive award is determined by a formula based upon the
performance of the Corporation against the Peer Group during the fiscal year as
measured against certain customer and stockholder value criteria on both a short
and long term basis. The amount of the incentive award is a percentage of the
officer's base salary and can range from 5 to 30 percent depending upon the
level of performance and the position of the individual corporate officer. The
criteria that are used and the weighted percentage of the award that is granted
for that specific criteria are: net income, normalized for the impact of
weather, as compared to budgeted net income, at 25 percent; 3-year average
return on equity at 12.5 percent; market-to-book ratio at 12.5 percent; the
ratio of long-term utility operating expenses to the long-term utility operating
revenues at 25 percent; and Board of Directors discretion at 25 percent. If the
weather normalized earnings result for the fiscal year does not equal at least
90 percent of the budget, then no incentive award is payable under the
provisions of the plan.

In December 1995 the Committee met to evaluate the fiscal 1995 results of
operations. At that time it was determined by the Board that the unusually warm
weather experienced in the utility companies operating areas caused the weather
normalized earnings to be distorted. As a result they determined that under the
provisions of the plan no incentive award would be calculated. However, since
management had met or exceeded all the other criteria established for the fiscal
year and the year had presented unique challenges, a bonus award was made to Mr.
Degen and a bonus pool was established for award to the other corporate
officers. The events which the Committee considered in their decision were the
smooth transition executed by a virtually new management team brought about by
the loss of several senior management personnel through death and retirement;
management's successful presentation of a request for increased rates for both
utility companies on a consolidated basis, resulting in a broader range of
commercial and industrial rates that will allow the companies to be more
responsive to customer needs; new initiatives in the marketing of large
gas-fired equipment outside of the traditional utility service operating areas;
and instituting a long range strategic plan to position the Corporation for the
next century in a less regulated environment. The Committee determined that,
based on these primary and other factors, the establishment

of the bonus award for Mr. Degen and the pool for the other corporate officers
was warranted. The incentive award of the current Chief Executive Officer
approximates 44 percent of the comparison group of companies. The incentive
award for the other officers approximates 45 percent of the comparison group.
The aggregate base salary of the current Chief Executive Officer approximates 80
percent of the comparison group and 85 percent for the other executive officers.

This report has been provided by the Compensation Committee.

Don A. DeAngelis (Chairperson)
Ernest N. Agresti
James M. Dillon
Jonathan K. Farnum
John F. Guthrie, Jr.

CORPORATE PERFORMANCE

The following charts compare the Corporation's performance, as measured by
the change in price of its common stock plus reinvested dividends, with the
Standard & Poor's natural gas index, the AMEX stock index and a group of
comparative diversified-energy companies for five- and ten-year periods. The
Peer Group consolidation was done on a weighted average basis (market
capitalization basis, adjusted at the end of each quarter). The graph assumes
$100 invested in the Company and each of the indices at August 31, 1991 for the
five-year period and at August 31, 1986 for the ten-year period. The Peer Group
consists of the following companies, which are also used to determine the annual
incentive award.

Atmos Energy Corporation MCN Corporation
Bay State Gas Company Mobile Gas Service Corporation
Berkshire Gas Company National Gas & Oil Corporation
Delta Natural Gas Company Providence Energy Corporation
Energynorth, Inc. Roanoke Gas Corporation
Essex County Gas Company Southeastern Michigan Energy Enterprises

COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
AMONG VALLEY RESOURCES, INC., THE AMEX MARKET VALUE INDEX,
THE S & P NATURAL GAS INDEX AND A PEER GROUP

8/91 8/92 8/93 8/94 8/95 8/96

Valley Resources, Inc. 100 102 152 129 119 139
Peer Group 100 128 174 176 184 244
AMEX Market Value 100 102 123 122 144 150
S & P Natural Gas 100 107 142 128 145 196

* $100 invested on 08/31/91 in stock or index -
including reinvestment of dividends.
Fiscal Year Ending August 31.

COMPARISON OF TEN-YEAR CUMULATIVE TOTAL RETURN*
AMONG VALLEY RESOURCES, INC., THE AMEX MARKET VALUE INDEX,
THE S & P NATURAL GAS INDEX AND A PEER GROUP

8/86 8/87 8/88 8/89 8/90 8/91 8/92 8/93 8/94 8/95 8/96

Valley Resources, Inc. 100 143 197 198 135 167 171 255 216 199 232
Peer Group 100 108 113 141 135 156 200 271 275 287 380
AMEX Market Value 100 132 108 140 118 136 139 167 166 195 204
S & P Natural Gas 100 141 137 127 135 181 162 184 249

*$100 Invested on 08/31/86 in stock or index -
including reinvestment of dividends.
Fiscal Year Ending August 31.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934 requires the
Corporation's officers and directors and persons who own more than 10% of a
registered class of the Corporation's equity securities ("insiders") to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission ("SEC"). Insiders are required by SEC regulation to furnish the
Corporation with copies of all Section 16(a) forms they file. Based solely on
review of the copies of such forms furnished to the Corporation, the Corporation
believes that during fiscal 1996 all Section 16(a) filing requirements
applicable to its insiders were in compliance.

1997 ANNUAL MEETING PROPOSALS

Stockholders may submit proposals for inclusion in the Proxy Statement for
the Annual Meeting of Stockholders to be held on December 9, 1997 provided the
proposal is received at the principal executive office of the Corporation, 1595
Mendon Road, Cumberland, Rhode Island 02864-0700, prior to July 7, 1997.

AUDITORS

The Board of Directors has selected the firm of Grant Thornton as the
independent certified public accountants for the Corporation to audit its
financial statements for the fiscal year 1996. This firm has served the
Corporation in this capacity for several years. A representative of Grant
Thornton is expected to attend the Annual Meeting and will be available to
respond to appropriate questions. It is not anticipated such representative will
make a prepared statement at the meeting; however, he or she will be free to do
so if he or she chooses.

OTHER BUSINESS

As of the date of this Proxy Statement, management knows of no other
matters to be brought before the meeting. Should any other business properly
come before the meeting, it is intended that the shares represented by proxies
will be voted with respect thereto in accordance with the best judgment of the
persons named in such proxies.

SOLICITATION EXPENSES

The Corporation will bear the cost of the solicitation of proxies by the
Board of Directors, including the charges and expenses of brokerage firms and
others for forwarding solicitation material to beneficial owners of stock.
Although it is anticipated that proxies will be solicited principally by mail,
proxies may be solicited by personal interview, telephone or telegraph, by
certain of the Corporation's employees without compensation therefor.

By Order of the Board of Directors,

K. W. Hogan, Secretary

Cumberland, Rhode Island
November 5, 1996

APPENDIX

VALLEY RESOURCES, INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

DECEMBER 10, 1996

To the Stockholders of
VALLEY RESOURCES, INC.

Notice is hereby given that the Annual Meeting of the Stockholders of
Valley Resources, Inc. (the "Corporation") will be held at the principal office
of the Corporation, 1595 Mendon Road, Cumberland, Rhode Island 02864-0700, on
Tuesday, December 10, 1996, at 10:00 a.m., for the following purposes:

1. To elect three directors, each to serve for a term of three years and
until their successors are elected and qualified.

2. To consider and act upon such other matters as may properly come
before the meeting and any and all adjournments thereof.

Only Common Stockholders of record on the stock transfer books of the
Corporation at the close of business on October 22, 1996 will be entitled to
notice of and to vote at the meeting and at any and all adjournments thereof.

Stockholders who are unable to attend the meeting in person and wish to
have their stock voted are requested to sign, date and return promptly the
accompanying Proxy in the enclosed envelope.

By Order of the Board of Directors,

K. W. Hogan, Secretary

Mailed: November 5, 1996

STOCKHOLDERS ARE REQUESTED TO EXECUTE THE ATTACHED PROXY AND RETURN IT
PROMPTLY IN THE ENVELOPE PROVIDED, WHETHER OR NOT THEY EXPECT TO ATTEND THE
ANNUAL MEETING. A STOCKHOLDER NEVERTHELESS MAY VOTE IN PERSON IF HE DOES ATTEND.

DETACH PROXY CARD HERE

1.Election of Directors FOR all nominees WITHHOLD AUTHORITY to vote *EXCEPTIONS
listed below [ ] for all nominees [ ]
listed below [ ]

Nominees: Ernest N. Agresti, Don A. DeAngelis, Eleanor M. McMahon
(INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the "Exceptions" box and write that nominee's name in the space provided below.)
*Exceptions ___________________________________________________________________
2. To consider and act upon other matters as they may properly come before the
meeting and any and all adjournments thereof.

In their discretion the Proxies are authorized to vote upon such other matters
as may properly come before the meeting or any adjournment or postponement
thereof.

Change of Address or
Comments Mark Here [ ]

The signature on this Proxy should correspond exactly with stockhold-
er's name as printed to the left. In the case of joint tenancies, co-executors,
or co-trustees, both should sign. Persons signing as Attorney, Executor,
Administrator, Trustee or Guardian should give their full title.

Dated: ___________________________, 199__

_______________________________________
Signature

Votes must be indicated (X) in Black or Blue ink. X

(Please sign, date and return this proxy in the enclosed
postage prepaid envelope.)

VALLEY RESOURCES, INC. PROXY/VOTING INSTRUCTION CARD
________________________________________________________________________________

This proxy is solicited on behalf of the Board of Directors of
Valley Resources, Inc. for the Annual Meeting on December 10, 1996

The stockholder appoints A. P. Degen, K. W. Hogan and P. A. Morrison, and
each of them, with full power of substitution in each, the proxies of the
stockholder, to represent the stockholder and vote all shares of Valley
Resources, Inc. Common Stock which the stockholder may be entitled to vote at
the Annual Meeting of Stockholders to be held on December 10, 1996, and at any
adjournment or postponement thereof, as indicated on the reverse side.

This proxy, when properly executed, will be voted in the manner directed
herein by the stockholder. If no direction is given, this proxy will be voted
FOR proposal 1.

VALLEY RESOURCES,INC.
P. O. BOX 11419
NEW YORK, NY 10203-0419

(Continued, and to be signed and dated on reverse side.)