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                                                                      EXHIBIT 23
 
                        CONSENT OF INDEPENDENT AUDITORS
 
The Board of Directors
Bay State Gas Company
 
     The audits referred to in our report dated October 27, 1998, included the
related financial statement schedule as of September 30, 1998, and for each of
the years in the three-year period ended September 30, 1998, included in the
annual report on Form 10-K of Bay State Gas Company. This financial statement
schedule is the responsibility of the Company's management. Our responsibility
is to express an opinion on this financial statement schedule based on our
audits. In our opinion, such financial statement schedule, when considered in
relation to the consolidated financial statements taken as a whole, presents
fairly in all material respects the information set forth therein.
 
     We consent to incorporation by reference in the registration statements
(No. 33-39118, and No. 33-44156) on Form S-3 and in the registration statements
(No. 33-35897, No. 33-22300 and No. 33-22301) on Form S-8 of our report dated
October 27, 1998, relating to the consolidated balance sheets and statements of
capitalization of Bay State Gas Company and subsidiaries as of September 30,
1998 and 1997 and the related consolidated statements of earnings, shareholders'
equity and cash flows for each of the years in the three-year period ended
September 30, 1998, which report is included in the September 30, 1998 annual
report on Form 10-K of Bay State Gas Company.
 
     As discussed in note 1 to the consolidated financial statements, the
Company changed its method of recognizing actuarial gains and losses for
postretirement benefit plans during 1998.
 
                                          KPMG PEAT MARWICK LLP
 
Boston, Massachusetts
January 6, 1998
 
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