Midcoast Energy Resources, Inc.
Ticker: MRS 1100 Louisiana, Suite 2950
Exchange: American Stock Exchange Houston, Texas 77002
Industry: Utilities (713) 650-8900

Type of Shares:Common Shares Filing Date:5/28/96
U.S. Shares:1,000,000 Offer Date:8/9/96
Non-U.S. Shares:0 Filing Range:$10.00 - $11.00
Primary Shares:1,000,000 Offer Price:$10.00
Secondary Shares:0 Gross Spread:$1.00
Offering Amount: $10,500,000 Selling:$0.50
Expenses:$465,000 Reallowance:$0.15
Shares Out After:2,500,000

ManagerTierPhone
Coleman and Company Securities, Inc.Lead Manager (212) 688-6725
Nolan SecuritiesCo-manager

Audited
Income
Latest
Unaudited
Income
Prior
Unaudited
Income
Balance
Sheet
12/31/95 3/31/96 3/31/95 3/31/96
Revenue:$15.62$5.16$2.91Assets:$11.89
Net Income:$2.13$0.36$0.05Liabilities:$7.37
EPS:$1.48$0.24$0.04Equity:$4.52

Note: Dollar amounts are in U.S. millions; Audited figures expressed as full year,
unaudited figures are partial year

Business Description
The Company is a rapidly growing pipeline company primarily engaged in the construction, acquisition, disposition, and operation of pipelines for end-users, as well as the transmission and gathering of natural gas and crude oil. Thirty-nine intrastate pipeline systems are owned or operated by the company in Alabama, Alaska, Kansas, Louisiana, Mississippi, New York, Oklahoma, Tennessee and Texas, with 26 of the company's pipelines being acquired or constructed since June 1994. Natural gas marketing operations and to a lesser degree, oil and gas production supplement the company's pipeline business. The company's principal growth and business strategy is to acquire or build pipelines to serve the end-user market while also continuing to pursue acquisition and divestiture opportunities in transmission and gathering of natural gas, other hydrocarbons and nonhydrocarbons fluids or gases.

Use of Proceeds
Proceeds from the proposed offering will be used for the purchase of the Olmitos system, the repayment of interim financing incurred with recent acquisitions, the repayment of certain outstanding indebtedness, working capital including future acquisitions of pipelines and related assets.

Last updated: 11/3/96

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