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                                                                      EXHIBIT 21
 
                         SUBSIDIARIES OF THE REGISTRANT
                               SEPTEMBER 30, 1996
 
Parent of Bay State Gas Company -- None
 
Subsidiaries of Registrant -- Northern Utilities, Inc.
                           -- Granite State Gas Transmission, Inc.
 
Subsidiaries of Granite State Gas Transmission, Inc. -- Bay State Energy
                                                     Development, Inc.
                                                     -- Natural Gas Development
                                                     Corp.
                                                     -- Bay State Energy
                                                     Enterprises, Inc.
                                                     -- EnergyUSA, Inc.
                                                     -- LNG Development, Corp.
 
     Each subsidiary is wholly owned. Northern Utilities, Inc. and Granite State
Gas Transmission, Inc. are incorporated in the State of New Hampshire. Bay State
Energy Development, Inc., Bay State Energy Enterprises, Inc., and EnergyUSA,
Inc. (formerly Energy Asset Funding, Inc.), and LNG Development, Corp. are
incorporated in the Commonwealth of Massachusetts. Natural Gas Development,
Corp. is incorporated in the State of Maine.