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                                NEWS RELEASE


[ATMOS LOGO]                                                [UNITED CITIES
                                                            GAS COMPANY LOGO]


DATE: JUNE 25, 1997                        ATMOS MEDIA CONTACT: Margaret Watson
                                                                 (972) 855-4050
FOR RELEASE: IMMEDIATELY              ATMOS INVESTOR/ANALYST CONTACT: Don James
                                                                 (972) 855-3720
                                                UNITED CITIES CONTACT: Jim Ford
                                                        (615) 373-5310 ext. 302

                  ILLINOIS COMMISSION APPROVES ATMOS MERGER
                              WITH UNITED CITIES

      (Dallas, Texas) -- Atmos Energy Corporation (NYSE: ATO) and United Cities
Gas Company (NASDAQ: UCIT) announced today that the Illinois Commerce Commission
has issued an order, dated June 25, 1997, approving the merger of United Cities
and Atmos.

      The Commission order reflects the agreement previously reached by the
parties to the approval proceeding. The only parties are Atmos, United Cities
and the Commission staff. The parties to the proceeding now have a 30-day
period in which to seek rehearing.

     "The approval by the Illinois Commerce Commission is the final approval
required for the merger of United Cities and Atmos.  We expect to close the
transaction in the last week of July," said Robert W. Best, chairman,
president, and chief executive officer of Atmos.

      United Cities Gas Company distributes natural gas and propane gas to
approximately 350,000 customers in 10 states. The company is also engaged in
other energy-related business.

     Atmos Energy Corporation provides natural gas service to more that 680,000
customers in Texas, Colorado, Kansas, Missouri, Louisiana, and Kentucky through
its operating companies -- Energas Company, Greeley Gas Company, Trans
Louisiana Gas Company and Western Kentucky Gas Company.