UNITED STATES
                   SECURITIES AND EXCHANGE COMMISSION
                         Washington, D.C.  20549

                               FORM 10-Q                   

     [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                    SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended           March 31, 1999
                              -------------------------------------

Commission file number                      1-14201
                      ---------------------------------------------

                              Sempra Energy                     
         ----------------------------------------------------------
           (Exact name of registrant as specified in its charter)

        California                                  33-0732627     
- -------------------------------                 -------------------
(State or other jurisdiction of                  (I.R.S. Employer
incorporation or organization)                  Identification No.)

             101 Ash Street, San Diego, California 92101
- -------------------------------------------------------------------
                (Address of principal executive offices)
                               (Zip Code)

                             (619) 696-2034
         ----------------------------------------------------------
           (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all 
reports required to be filed by Section 13 or 15(d) of the 
Securities Exchange Act of 1934 during the preceding 12 months (or 
for such shorter period that the registrant was required to file 
such reports), and (2) has been subject to such filing requirements 
for the past 90 days.

Yes   X      No   
    -----       -----

Common stock outstanding on April 30, 1999:      240,119,972
                                              ---------------------


ITEM 1.  FINANCIAL STATEMENTS.


                          SEMPRA ENERGY
           STATEMENTS OF CONSOLIDATED INCOME (Unaudited)
          (Dollars in millions, except per share amounts)

                                                Three Months Ended
                                                     March 31,
                                                  ---------------
                                                   1999     1998
                                                  ------   ------
                                                    
Revenues and Other Income:
Utility revenues:
  Natural gas                                     $ 698    $ 761
  Electric                                          360      497
Other operating revenues                            111       77
Other income                                         22       15
                                                  ------   ------
  Total                                           1,191    1,350
                                                  ------   ------

Expenses:
  Cost of natural gas distributed                   291      330
  Purchased power - net                              66       96
  Electric fuel                                      35       31
  Operating expenses                                389      377
  Depreciation and amortization                     142      275
  Franchise payments and other taxes                 45       51
  Preferred dividends of subsidiaries                 3        4
                                                  ------   ------
  Total                                             971    1,164
                                                  ------   ------
Income Before Interest and Income Taxes             220      186
Interest                                             58       55
                                                  ------   ------
Income Before Income Taxes                          162      131
Income Taxes                                         63       44
                                                  ------   ------
Net Income                                        $  99    $  87
                                                  ======   ======
Net Income Per Share of Common Stock (Basic)      $0.42    $0.37
                                                  ======   ======
Net Income Per Share of Common Stock (Diluted)    $0.42    $0.37
                                                  ======   ======
Common Dividends Declared Per Share               $0.39    $0.32
                                                  ======   ======


See notes to Consolidated Financial Statements.                   


















                            SEMPRA ENERGY
                     CONSOLIDATED BALANCE SHEETS 
                        (Dollars in millions)

                                                       Balance at
                                                 ------------------------
                                                  March 31,   December 31,
                                                     1999         1998                             
                                                 (Unaudited)
                                                 -----------  -----------
                                                         
ASSETS 
Current assets:
  Cash and cash equivalents                       $   622       $  424
  Accounts receivable - trade                         512          586
  Account and note receivable - other                 180          159
  Deferred income taxes                                77           93
  Energy trading assets                               839          906
  Inventories                                          90          151
  Other                                               168          139
                                              ----------------------------
     Total current assets                           2,488        2,458
                                              ----------------------------
Investments and other assets:
  Regulatory assets                                 1,060        1,056
  Nuclear-decommissioning trusts                      495          494
  Investments                                         587          548
  Other assets                                        514          459
                                              ----------------------------
     Total investments and other assets             2,656        2,557
                                              ----------------------------
Property, plant and equipment:
  Property, plant and equipment                    11,289       11,235
  Less accumulated depreciation and amortization   (5,901)      (5,794)
                                              ----------------------------
     Total property, plant and equipment - net      5,388        5,441
                                               ---------------------------
     Total assets                                 $10,532      $10,456
                                               ===========================       




See notes to Consolidated Financial Statements.     











                           SEMPRA ENERGY
                    CONSOLIDATED BALANCE SHEETS 
                       (Dollars in millions)

                                                        Balance at
                                                 ------------------------
                                                   March 31,  December 31,
                                                     1999        1998       
                                                  (Unaudited)
                                                  ----------- -----------
                                                         
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
  Short-term debt                                 $    38      $    43
  Accounts payable - trade                            571          702
  Accrued income taxes                                 35           27
  Energy trading liabilities                          677          805
  Dividends and interest payable                      163          168
  Regulatory balancing accounts - net                 461          120
  Long-term debt due within one year                  349          330
  Other                                               258          271
                                               ---------------------------
     Total current liabilities                      2,552        2,466
                                               ---------------------------
Long-term debt                                      2,762        2,795
                                               ---------------------------
Deferred credits and other liabilities:
  Customer advances for construction                   71           72
  Post-retirement benefits other than pensions        220          240
  Deferred income taxes                               648          634
  Deferred investment tax credits                     137          147
  Deferred credits and other liabilities            1,017          985
                                               --------------------------- 
    Total deferred credits and other liabilities    2,093        2,078
                                               ---------------------------
Preferred stock of subsidiaries                       204          204
                                               ---------------------------
Commitments and contingent liabilities (Note 3)

Shareholders' Equity:
  Common Stock                                      1,886        1,883
  Retained earnings                                 1,080        1,075
  Deferred compensation relating to 
    Employee Stock Ownership Plan                     (45)         (45)
                                               ---------------------------
     Total shareholders' equity                     2,921        2,913
                                               ---------------------------  
     Total liabilities and shareholders' equity   $10,532      $10,456
                                               ===========================

See notes to Consolidated Financial Statements.     



                            SEMPRA ENERGY 
       CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (Unaudited)    
                        (Dollars in millions)

                                                              Three Months Ended
                                                                   March 31,
                                                           ------------------------
                                                             1999             1998
                                                           -------          -------
                                                                      
Cash Flows From Operating Activities:                             
Net income                                                  $  99           $  87
Adjustments to reconcile net income to net cash
  provided by operating activities:
     Depreciation and amortization                            142             275
     Deferred income taxes and investment tax credits           4             (57)
     Other - net                                              (64)           (124)
     Net changes in other working capital components          267             572
                                                          -------------------------
       Net cash provided by operating activities              448             753
                                                          -------------------------
Cash Flows From Investing Activities:
  Expenditures for property plant and equipment               (73)            (78)
  Acquisitions of subsidiaries                                 --            (119)
  Contributions to decommissioning trusts                      (5)             (5)
  Other                                                       (30)              8
                                                          -------------------------
     Net cash used in investing activities                   (108)           (194)
                                                          -------------------------
Cash Flows From Financing Activities:
  Common stock dividends                                      (94)            (76)
  Sale of common stock                                          3               9
  Repurchase of common stock                                   --              (1)
  Redemption of preferred stock                                --             (75)
  Issuance of long-term debt                                   10              76
  Payment on long-term debt                                   (56)           (201)
  Decrease in short-term debt - net                            (5)           (272)
                                                          -------------------------
     Net cash used in financing activities                   (142)           (540)
                                                          -------------------------
Increase in Cash and Cash Equivalents                         198              19
Cash and Cash Equivalents, January 1                          424             814
                                                           ------------------------
Cash and Cash Equivalents, March 31                        $  622           $ 833
                                                           ========================

Supplemental Disclosure of Cash Flow Information:
  Interest payments (net of amounts capitalized)           $  63          $   59
                                                           ========================
  Income tax payments (net of refunds)                     $  24          $    7
                                                           ========================


See notes to Consolidated Financial Statements.








NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.  GENERAL

This Quarterly Report on Form 10-Q is that of Sempra Energy (the 
Company), a California-based Fortune 500 energy services company. 
Sempra Energy's principal subsidiaries are San Diego Gas & Electric 
Company (SDG&E), and Southern California Gas Company (SoCalGas). The 
financial statements herein are the Consolidated Financial Statements 
of Sempra Energy and its subsidiaries.

The accompanying Consolidated Financial Statements have been prepared 
in accordance with the interim-period-reporting requirements of Form 
10-Q. Results of operations for interim periods are not necessarily 
indicative of results for the entire year. In the opinion of 
management, the accompanying statements reflect all adjustments 
necessary for a fair presentation. These adjustments are of a normal 
recurring nature. Certain changes in classification have been made to 
prior presentations to conform to the current financial statement 
presentation.

The Company's significant accounting policies, as well as those of 
its subsidiaries, are described in the notes to Consolidated 
Financial Statements in the Company's 1998 Annual Report. The same 
accounting policies are followed for interim reporting purposes.

This Quarterly Report should be read in conjunction with the 
Company's 1998 Annual Report, which includes the Consolidated 
Financial Statements and notes thereto, and the annual "Management's 
Discussion & Analysis of Financial Condition and Results of 
Operations."

SDG&E and SoCalGas have been accounting for the economic effects of 
regulation on all utility operations in accordance with Statement of 
Financial Accounting Standards No. 71, "Accounting for the Effects of 
Certain Types of Regulation" (SFAS No. 71), as described in the notes 
to Consolidated Financial Statements in the Company's 1998 Annual 
Report. In conformity with generally accepted accounting principles 
for regulated enterprises and the policies of the California Public 
Utilities Commission (CPUC), SDG&E has ceased the application of SFAS 
No. 71 to its generation business, in accordance with the conclusion 
of the Financial Accounting Standards Board that the application of 
SFAS No. 71 should be discontinued when legislation is issued that 
determines that a portion of an entity's business will no longer be 
subject to cost-based regulation. The discontinuance of SFAS No. 71 
has not resulted in a write-off of SDG&E's generation assets, since 
the CPUC has approved the recovery of the stranded costs related to 
these assets by the distribution portion of its business, subject to 
a rate cap. (See further discussion in Note 3.)

2.  BUSINESS COMBINATIONS

PE/Enova 

On June 26, 1998 (pursuant to an October 1996 agreement) Enova (the 
parent corporation of San Diego Gas & Electric) and PE (the parent 
corporation of the Southern California Gas Company) completed a 
business combination in which the companies became subsidiaries of a 
new company named Sempra Energy. As a result of the combination, (i) 
each outstanding share of common stock of Enova was converted into 
one share of common stock of Sempra Energy, (ii) each outstanding 
share of common stock of PE was converted into 1.5038 shares of 
common stock of Sempra Energy and (iii) the preferred stock and/or 
preference stock of SDG&E, PE and SoCalGas remain outstanding. 
Additional information on the business combination is discussed in 
the Company's 1998 Annual Report.

Expenses incurred in connection with the business combination were 
$0.5 million, after tax, and $1.4 million, after tax, for the three-
month periods ended March 31, 1999 and 1998, respectively.  These 
costs consisted primarily of employee-related costs, and investment 
banking, legal, regulatory and consulting fees.

KN Energy

On February 22, 1999, Sempra Energy and KN Energy, Inc. (KN Energy) 
announced that their respective boards of directors had approved 
Sempra Energy's acquisition of KN Energy, subject to approval by the 
shareholders of both companies and by various federal and state 
regulatory agencies. If the transaction is approved, holders of KN 
Energy common stock will receive 1.115 shares of Sempra Energy common 
stock or $25 in cash, or some combination thereof, for each share of 
KN Energy common stock. In the aggregate, the cash portion of the 
transaction will constitute not more than 30 percent of the total 
consideration. The transaction will be treated as a purchase for 
accounting purposes. On March 30, 1999, Sempra Energy was notified 
that the U.S. Federal Trade Commission had granted the Company's 
request for early clearance under the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, as amended, with respect to the proposed 
merger.

3.  MATERIAL CONTINGENCIES

ELECTRIC INDUSTRY RESTRUCTURING -- CALIFORNIA PUBLIC UTILITIES 
COMMISSION

In September 1996 the State of California enacted a law restructuring 
California's electric utility industry (AB 1890). The legislation 
adopts the December 1995 CPUC policy decision that restructures the 
industry to stimulate competition and reduce rates.

Beginning on March 31, 1998, customers were given the opportunity to 
choose to continue to purchase their electricity from the local 
utility under regulated tariffs, to enter into contracts with other 
energy-service providers (direct access) or to buy their power from 
the independent Power Exchange (PX) that serves as a wholesale power 
pool allowing all energy producers to participate competitively. The 
PX obtains its power from qualifying facilities, from nuclear units 
and, lastly, from the lowest-bidding suppliers. The California 
investor-owned electric utilities (IOUs) are obligated to sell their 
power supply, including owned generation and purchased-power 
contracts, to the PX. The IOUs are also obligated to purchase from 
the PX the power that they distribute. An Independent System Operator 
(ISO) schedules power transactions and access to the transmission 
system. The local utility continues to provide distribution service 
regardless of which energy source the customer chooses. Purchases 
from the PX/ISO are included in purchased-power expenses and PX/ISO 
power revenues have been netted therein on the Statements of 
Consolidated Income as presented. Revenues from the PX/ISO reflect 
sales at market prices of energy from SDG&E's power plants and from 
long-term purchased-power contracts to the PX/ISO commencing April 1, 
1998. 

As discussed in the notes to Consolidated Financial Statements 
contained in the Company's 1998 Annual Report, the IOUs have been 
given a reasonable opportunity to recover their stranded costs via a 
competition transition charge (CTC) to customers through December 31, 
2001. Excluding the costs of purchased power and other costs whose 
recovery is not limited to the pre-2002 period, the balance of 
SDG&E's stranded assets at March 31, 1999 is $600 million, consisting 
of $400 million for the power plants (see the following paragraph) 
and $200 million of related deferred taxes and undercollections. 
During the 1998-2001 period, recovery of transition costs is limited 
by a rate cap (discussed below). 

In November 1997 SDG&E announced a plan to auction its power plants 
and other generation assets. This plan includes the divestiture of 
SDG&E's fossil power plants and combustion turbines, its 20-percent 
interest in the San Onofre Nuclear Generating Station (SONGS) and its 
portfolio of long-term purchased-power contracts. The power plants 
have a net book value as of March 31, 1999 of $400 million ($300 
million for SONGS and $100 million for the fossil plants) and a 
combined generating capacity of 2,400 megawatts. The proceeds from 
the sales will be applied directly to SDG&E's transition costs. The 
fossil-fuel assets' auction is being separated from the auction of 
SONGS and the purchased-power contracts. In October 1998, the CPUC 
issued an interim decision approving the commencement of the fossil 
fuel assets' auction. 

On December 11, 1998 contracts were executed for the sale of SDG&E's 
South Bay Power Plant, Encina Power Plant and 17 combustion-turbine 
generators. In early 1999, the CPUC issued its final approvals of 
these transactions. The South Bay Power Plant sale to the San Diego 
Unified Port District for $110 million was completed on April 23, 
1999. Duke South Bay, a subsidiary of Duke Energy Power Services, 
will manage the plant for the Port District.  The Encina Power Plant 
and the combustion-turbine generators are being sold to a special-
purpose entity owned equally by Dynegy Power Corp. and NRG Energy, 
Inc. for $350 million. This transaction is expected to close by mid 
1999.  SDG&E will continue to operate the facilities for the next two 
years. 

AB 1890 required a 10-percent reduction of residential and small 
commercial customers' rates beginning in January 1998, and provided 
for the issuance of rate-reduction bonds by an agency of the State of 
California to enable the IOUs to achieve this rate reduction. In 
December 1997, $658 million of rate-reduction bonds were issued on 
SDG&E's behalf at an average interest rate of 6.26 percent. These 
bonds are being repaid over 10 years by SDG&E's residential and small 
commercial customers via a non-bypassable charge on their electric 
bills. In 1997 SDG&E formed a subsidiary, SDG&E Funding LLC, to 
facilitate the issuance of the bonds. In exchange for the bond 
proceeds, SDG&E sold to SDG&E Funding LLC all of its rights to 
revenue streams collected from such customers. Consequently, the 
transaction is structured to cause such revenue streams not to be the 
property of SDG&E nor to be available to satisfy any claims of 
SDG&E's creditors.

AB 1890 includes a rate freeze for all customers. Beginning in 1998, 
system-average rates were fixed at 9.43 cents per kwh. The rate 
freeze could stay in place until January 1, 2002. However, SDG&E 
recently filed with the CPUC for an interim mechanism to deal with 
electric rates after the rate freeze ends, noting the possibility 
that the SDG&E rate freeze could end in 1999. A subsequent SDG&E 
filing requests expedited treatment from the CPUC to end the rate 
freeze and to set interim rates effective July 1, 1999, as well as a 
request for adoption of final rates. SDG&E is requesting authority to 
reduce base rates (the portion of the rate that SDG&E controls) to 
all electric customers. If approved, base electric rates will 
decrease by an additional five percent to 15 percent, depending on 
the customer class, beyond the original 10-percent rate reduction 
described above. The portion of the electric rate representing the 
commodity cost is simply passed through to customers and will 
fluctuate with the price of electricity from the PX. Once the rate 
freeze is lifted, except for the interim protection mechanism 
described below, customers will no longer be protected from commodity 
price spikes. The request to end the rate freeze is based on a 
projection of SDG&E's recovering all applicable electric 
restructuring transition costs before July 1, 1999. 

In April 1999 SDG&E filed an all-party settlement (including energy 
service providers, the CPUC's Office of Ratepayer Advocates (ORA), 
and the Utility Consumers Action Network (UCAN)) detailing proposed 
implementation plans for the rate freeze lifting. Included in the 
settlement is an interim customer-protection mechanism for 
residential and small commercial customers that would temporarily cap 
rates between July 1999 and September 1999, regardless of how high 
the PX price moves during that period. Any resulting undercollection 
would be recovered through a balancing account mechanism.  An interim 
CPUC decision is expected no later than June 24, 1999.

Thus far, electric-industry deregulation has been confined to 
generation. Transmission and distribution have remained subject to 
traditional cost-of-service regulation. However, the CPUC is 
exploring the possibility of opening up electric distribution to 
competition. During 1999, the CPUC will be conducting a rulemaking, 
one objective of which may be to develop a coordinated proposal for 
the state legislature regarding how various distribution competition 
issues should be addressed. SDG&E will actively participate in this 
effort.

ELECTRIC INDUSTRY RESTRUCTURING -- FEDERAL ENERGY REGULATORY 
COMMISSION

In October 1997, the Federal Energy Regulatory Commission (FERC) 
approved key elements of the California IOUs' restructuring proposal. 
This included the transfer by the IOUs of the operational control of 
their transmission facilities to the ISO, which is under FERC 
jurisdiction. The FERC also approved the establishment of the 
California PX to operate as an independent wholesale power pool. The 
IOUs pay to the PX an up-front restructuring charge (in four annual 
installments) and an administrative-usage charge for each megawatt-
hour of volume transacted. SDG&E's share of the restructuring charge 
is approximately $10 million, which is being recovered as a 
transition cost. The IOUs have guaranteed $300 million of commercial 
loans to the ISO and PX for their development and initial start-up. 
SDG&E's share of the guarantee is $30 million.

NATURAL GAS INDUSTRY RESTRUCTURING

The natural gas industry experienced an initial phase of 
restructuring during the 1980s by deregulating natural gas sales to 
noncore customers. On January 21, 1998, the CPUC released a staff 
report initiating a project to assess the current market and 
regulatory framework for California's natural gas industry. The 
general goals of the plan are to consider reforms to the current 
regulatory framework emphasizing market-oriented policies benefiting 
California's natural gas consumers. 

In August 1998, California enacted a law prohibiting the CPUC from 
enacting any natural gas industry restructuring decision for core 
customers prior to January 1, 2000; the CPUC continues to study the 
issue. During the implementation moratorium, the CPUC will hold 
hearings throughout the state and intends to give the legislature a 
draft ruling before adopting a final market-structure policy.  SDG&E 
and SoCalGas will actively participate in this effort.

NUCLEAR INSURANCE

SDG&E and the co-owners of SONGS have purchased primary insurance of 
$200 million, the maximum amount available, for public-liability 
claims. An additional $9.5 billion of coverage is provided by the 
Nuclear Regulatory Commission Secondary Financial Protection Program 
and provides for loss sharing among utilities owning nuclear reactors 
if a costly accident occurs. SDG&E could be assessed up to $36 
million in the event of a nuclear incident involving any of the 
licensed commercial reactors in the United States if the amount of 
the loss exceeds $200 million. In the event the public-liability 
limit stated above is insufficient, the Price-Anderson Act provides 
for Congress to enact further revenue-raising measures to pay claims 
which could include an additional assessment on all licensed reactor 
operators.

Insurance coverage is provided for up to $2.75 billion of property 
damage and decontamination liability. Coverage is also provided for 
the cost of replacement power, which includes indemnity payments for 
up to three years, after a waiting period of 17 weeks. Coverage is 
provided primarily through mutual insurance companies owned by 
utilities with nuclear facilities. If losses at any of the nuclear 
facilities covered by the risk-sharing arrangements were to exceed 
the accumulated funds available from these insurance programs, SDG&E 
could be assessed retrospective premium adjustments of up to $4.5 
million.

CANADIAN NATURAL GAS 

SDG&E has been involved in negotiations and litigation with four 
Canadian suppliers concerning contract terms and prices. SDG&E has 
settled with three of the suppliers. One of the three is delivering 
natural gas under the terms of the settlement agreement through 2003; 
the other two have ceased deliveries and the contracts were 
terminated. The fourth supplier has ceased deliveries pending legal 
resolution. Although these contracts were intended to supply SDG&E to 
a level approximating the related committed long-term pipeline 
capacity, SDG&E intends to continue using the capacity in other ways, 
including the transport of replacement natural gas and the release of 
a portion of this capacity to third parties.

QUASI-REORGANIZATION

During 1993, PE completed a strategic plan to refocus on its natural 
gas utility and related businesses. The strategy included the 
divestiture of the Company's merchandising operations and all of its 
oil and gas exploration and production business.  In connection with 
the divestitures, PE effected a quasi-reorganization for financial-
reporting purposes, effective December 31, 1992. Certain of the 
liabilities established in connection with discontinued operations 
and the quasi-reorganization will be resolved in future years. 
Management believes the provisions previously established for these 
matters are adequate.

4.  COMPREHENSIVE INCOME

In conformity with generally accepted accounting principles, the 
Company has adopted Statement of Financial Accounting Standards No. 
130, "Reporting Comprehensive Income." Comprehensive income for the 
three-month periods ended March 31, 1999 and 1998 was equal to net 
income.

5. SEGMENT INFORMATION

The Company, primarily an energy-services company, has three 
separately managed reportable segments comprised of SDG&E, SoCalGas 
and Sempra Energy Trading (SET). The two utilities operate in 
essentially separate service territories under separate regulatory 
frameworks and rate structures set by the CPUC. As described in the 
notes to Consolidated Financial Statements in the Company's 1998 
Annual Report, SDG&E provides electric and natural gas service to San 
Diego and southern Orange counties. SoCalGas is a natural gas 
distribution utility, serving customers throughout most of southern 
California and part of central California. SET is based in Stamford, 
Connecticut and is engaged in the nationwide wholesale trading and 
marketing of natural gas, power and petroleum. The accounting 
policies of the segments are the same as those described in the notes 
to Consolidated Financial Statements in the Company's 1998 Annual 
Report, and segment performance is evaluated by management based on 
reported net income. Intersegment transactions generally are recorded 
the same as sales or transactions with third parties. Utility 
transactions are primarily based on rates set by the CPUC and the 
FERC. There were no significant changes in segment assets for the 
three months ended March 31, 1999. See Note 3 regarding the sale of 
the Company's power plants. Segment information of SoCalGas and SDG&E 
is provided in the Quarterly Report on Form 10-Q for the three-month 
period ended March 31, 1999 of each of these companies.


- ------------------------------------------------------------
                                    Three months ended
                                         March 31,
                                 ---------------------------
(Dollars in millions)                 1999       1998
- ------------------------------------------------------------
Operating Revenues:
  San Diego Gas & Electric          $  461    $   606 
  Southern California Gas              607        664 
  Sempra Energy Trading                 73          9
  Intersegment revenues                (14)       (11)
  All other                             64         82 
                                   -------------------
    Total                           $1,191    $ 1,350 
                                   -------------------
Net Income:
  San Diego Gas & Electric*         $   53    $    48
  Southern California Gas*              47         47
  Sempra Energy Trading                  1         (8)
  All other                             (2)         -
                                   -------------------
    Total                           $   99    $    87 
                                   -------------------
* after preferred dividends


6. SEMPRA ENERGY HOLDINGS

On May 5, 1999, Sempra Energy and its wholly owned subsidiary, Sempra 
Energy Holdings (Holdings), jointly filed a shelf registration of 
common stock, preferred stock, debt securities and guarantees of 
Sempra Energy; debt securities of Holdings; and certain other 
securities to be offered on a delayed or continuous basis pursuant to 
Rule 415 under the Securities Act of 1933. Because any debt 
securities issued by Holdings will be guaranteed by Sempra Energy, 
summarized financial information of Holdings is provided below. 
Additional financial information of Holdings is provided in Sempra 
Energy's Current Report on Form 8-K filed May 5, 1999.


                          (Dollars in millions)

                                    At March 31,    At December 31,
                                       1999              1998
                                    -------------   --------------
            Current assets            $1,396            $1,470
            Non-current assets           587               544
            Current liabilities        1,367             1,452
            Non-current liabilities      139               140

                                    Three Months Ended
                                         March 31,
                                    ------------------
                                     1999       1998
                                    ------------------
            Operating revenues      $ 114       $ 111
            Operating expenses        129         131
            Net loss                   10          11



ITEM 2.

             MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS


The following discussion should be read in conjunction with the 
financial statements contained in this Form 10-Q and Management's 
Discussion and Analysis of Financial Condition and Results of 
Operations contained in the Company's 1998 Annual Report.

INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes forward-looking 
statements within the meaning of the Private Securities Litigation 
Reform Act of 1995. The words "estimates," "believes," "expects," 
"anticipates," "plans" and "intends," variations of such words, and 
similar expressions are intended to identify forward-looking 
statements that involve risks and uncertainties which could cause 
actual results to differ materially from those anticipated.

These statements are necessarily based upon various assumptions 
involving judgments with respect to the future including, among 
others, local, regional, national and international economic, 
competitive, political and regulatory conditions and developments; 
technological developments; capital market conditions; inflation 
rates; interest rates; energy markets; weather conditions; business, 
regulatory or legal decisions; the pace of deregulation of retail 
natural gas and electricity industries; the timing and success of 
business development efforts; and other uncertainties, all of which 
are difficult to predict and many of which are beyond the control of 
the Company. Accordingly, while the Company believes that the 
assumptions are reasonable, there can be no assurance that they will 
approximate actual experience, or that the expectations will be 
realized. Readers are urged to review and consider carefully the 
risks, uncertainties and other factors which affect the Company's 
business described in this quarterly report and other reports filed 
by the Company from time to time with the Securities and Exchange 
Commission. Readers are cautioned not to put undue reliance on any 
forward-looking statements. For those statements, the Company claims 
the protection of the safe harbor for forward-looking statements 
contained in the Private Securities Litigation Reform Act of 1995.

BUSINESS COMBINATIONS

See Note 2 of the notes to Consolidated Financial Statements 
regarding the PE/Enova business combination and the KN Energy 
proposed merger. See "International Operations" below for a 
discussion of the planned acquisition of Chilquinta Energia S.A.

CAPITAL RESOURCES AND LIQUIDITY 

The Company's utility operations continue to be a major source of 
liquidity. In addition, working capital requirements are met through 
the issuance of short-term and long-term debt. These capital 
resources are expected to remain available. Cash requirements 
primarily include utility capital expenditures, repayments and 
retirements of long-term debt, and costs related to the proposed 
acquisitions of KN Energy and Chilquinta Energia S.A. Major changes 
in cash flows not described elsewhere are described below. Cash and 
cash equivalents at March 31, 1999 are available for investment in 
energy-related domestic and international projects, the retirement of 
debt, and other corporate purposes.

CASH FLOWS FROM OPERATING ACTIVITIES

Cash flows from operations decreased primarily due to greater working 
capital requirements and to a decrease in collections on regulatory 
balancing accounts compared to 1998. Overcollected balancing accounts 
increased for both periods due to actual natural gas costs' being 
lower than amounts collected in rates.

CASH FLOWS FROM INVESTING ACTIVITIES 

Capital expenditures for property, plant and equipment are estimated 
to be $420 million for the full year 1999 and will be financed 
primarily by internally generated funds and will largely represent 
investment in utility operations. Construction, investment and 
financing programs are continuously reviewed and revised in response 
to changes in competition, customer growth, inflation, customer 
rates, the cost of capital, and environmental and regulatory 
requirements. 

In January 1998 PE and Enova jointly acquired CES/Way International, 
Inc. for a total of $79 million. CES/Way provides energy-efficiency 
services, including energy audits, engineering design, project 
management, construction, financing and contract maintenance. 

In March 1998 PE increased its existing investment in two Argentine 
natural gas utility holding companies from 12.5 percent to 21.5 
percent by purchasing an additional interest for $40 million. 

CASH FLOWS FROM FINANCING ACTIVITIES 

Net cash used in financing activities decreased due to greater long-
term and short-term debt repayments and the repurchase of preferred 
stock in 1998. The decrease was partially offset by higher dividends 
paid on common stock in 1999. 

Dividends paid on common stock were $94 million during the three-
month period ended March 31, 1999, compared to $76 million during the 
same period in 1998. The increase in 1999 is the result of the 
Company's paying dividends on its common stock at the rate previously 
paid by Enova, which, on an equivalent-share basis, is higher than 
the rate paid by PE.

Dividends currently are paid quarterly to shareholders. The payment 
of future dividends is within the discretion of the board of 
directors. 

On February 2, 1998, SoCalGas redeemed all outstanding shares of 7-
3/4% Series Preferred Stock for a total cost of $75 million, 
including unpaid dividends.

RESULTS OF OPERATIONS

The increases in net income and net income per share for the three 
months ended March 31, 1999 are primarily due to higher net income at 
SDG&E due to property sales and improved results at Sempra Energy 
Trading (SET) due to higher trading gains. SoCalGas' net income for 
the three-month period ended March 31, 1999 was consistent with net 
income for the same period in 1998. 

Income tax expense increased for the three-month period ended March 
31, 1999, compared to the corresponding period in 1998, due to the 
increase in income before taxes. The increase in income before taxes, 
coupled with a relatively unchanged level of income tax credits, 
resulted in an increase in the Company's income tax rate.

UTILITY OPERATIONS

Utility natural gas revenues decreased 8 percent for the three-month 
period ended March 31, 1999 compared to the same period in 1998. The 
decrease was primarily due to a decrease in the average cost of 
natural gas and lower utility electric generating sales, partially 
offset by a slight increase in sales to residential customers due to 
colder weather and customer growth in 1999.  

Electric revenues decreased 28 percent in 1999 primarily due to the 
January 1998 application to stranded cost recovery of the $130 
million balance in the Interim Transition Cost Balancing Account 
(ITCBA), which had been transferred from the then-discontinued ECAC 
and ERAM balancing accounts at December 31, 1997. In addition, there 
was a decrease in retail revenues as a result of a decrease in sales 
to other utilities, due to the start-up of the PX. The PX is 
described further under "Factors Influencing Future Performance".

Cost of natural gas distributed decreased 12 percent for the three-
month period ended March 31, 1999. The decrease was primarily due to 
the decrease in the average cost of natural gas purchased and lower 
utility electric generating sales, offset by higher volumes. Under 
the current regulatory framework, changes in revenue resulting from 
changes in core market volumes and the cost of natural gas do not 
affect net income.

As discussed in Note 3, PX/ISO power revenues have been netted 
against purchased-power expenses, including purchases from the 
PX/ISO. The PX/ISO began operations in April 1998.

Depreciation and amortization decreased 48 percent for the three-
month period ended March 31, 1999, compared to the same period in 
1998 due to the January 1998 application of the ITCBA to stranded 
cost recovery as discussed above.

The tables below summarize the components of natural gas and electric 
volumes and revenues by customer class for the three months ended 
March 31, 1999 and 1998. 



Gas Sales, Transportation & Exchange
(Dollars in millions, volumes in billion cubic feet)


                                Gas Sales     Transportation & Exchange        Total
                      --------------------------------------------------------------------
                           Throughput  Revenue   Throughput  Revenue    Throughput  Revenue
                      --------------------------------------------------------------------
                                                                
1999:
 Residential                     115   $  724           1     $  1          116   $  725
 Commercial and industrial        32      178          81       66          113      244
 Utility electric generation*     12        5          16        7           28       12
 Wholesale                         -        -           8        2            8        2
                            --------------------------------------------------------------
                                 159   $  907         106     $ 76          265      983
 Balancing accounts and other                                                       (285)
                                                                                 --------
   Total                                                                          $  698
- ------------------------------------------------------------------------------------------

1998:
 Residential                     109   $  809           1     $  4          110   $  813
 Commercial and industrial        30      186          86       71          116      257
 Utility electric generation*     10        2          23       11           33       13
 Wholesale                         -        -           9        2            9        2
                            --------------------------------------------------------------
                                 149   $  997         119     $ 88          268    1,085
 Balancing accounts and other                                                       (324) 
                                                                                 ---------
   Total                                                                          $  761
- ------------------------------------------------------------------------------------------
* The portion representing SDG&E's sales for electric generation includes 
margin only.




Electric Distribution
(Dollars in millions, volumes in millions of Kwhrs



                                   1999              1998         
                        ------------------------------------------
                             Volumes  Revenue  Volumes  Revenue   
                        ------------------------------------------
                                                   
  Residential                 1,685   $  170    1,631   $  167    
  Commercial                  1,518      125    1,632      134    
  Industrial                    489       31      814       48    
  Direct access                 657       21        -        -    
  Street and highway lighting    19        2       22        2    
  Off-system sales               26        -      595       13    
                        ------------------------------------------
                              4,394      349    4,694      364    
  Balancing and other                     11               133    
                        ------------------------------------------
  Total                       4,394   $  360    4,694   $  497    
                        ------------------------------------------


YEAR 2000 ISSUES

Most companies are affected by the inability of many automated 
systems and applications to process the year 2000 and beyond. The 
Year 2000 issues are the result of computer programs and other 
automated processes using two digits to identify a year, rather than 
four digits. Any of the Company's computer programs that include 
date-sensitive software may recognize a date using "00" as 
representing the year 1900, instead of the year 2000, or "01" as 
1901, etc., which could lead to system malfunctions. The Year 2000 
issue impacts both Information Technology ("IT") systems and also 
non-IT systems, including systems incorporating embedded processors. 
To address this problem, in 1996, both Pacific Enterprises and Enova 
Corporation established company-wide Year 2000 programs. These 
programs have now been consolidated into Sempra Energy's overall Year 
2000 readiness effort. Sempra Energy has established a central Year 
2000 Program Office, which reports to the Company's Chief Information 
Technology Officer and reports periodically to the audit committee of 
the Board of Directors.

The Company's State of Readiness

Sempra Energy has identified all IT and non-IT systems (including 
embedded systems) that might not be Year 2000 ready and categorizing 
them in the following areas: IT applications, computer hardware and 
software infrastructure, telecommunications, embedded systems, and 
third parties. The Company evaluated its exposure in all of these 
areas. These systems and applications are being tracked and measured 
through four key phases: inventory, assessment, remediation/testing, 
and Year 2000 readiness. The Company has prioritized so that, when 
possible, critical systems are being assessed and modified/replaced 
first. Critical systems are those applications and systems, including 
embedded processor technology, which, if not appropriately 
remediated, may have a significant impact on energy delivery, revenue 
collection or the safety of personnel, customers or facilities. The 
Company's Year 2000 testing effort includes functional testing of 
Year 2000 dates and validating that changes have not altered existing 
functionality. The Company uses an independent, internal review 
process to verify that the appropriate testing has occurred.

The Company's Year 2000 project is currently on schedule and the 
company estimates that all critical systems will be Year 2000 Ready 
by June 30, 1999. The Company defines "Year 2000 Ready" as suitable 
for continued use into the year 2000 with no significant operational 
problems. 

Sempra Energy's current schedule for Year 2000 testing, readiness and 
development of contingency plans is subject to change depending upon 
the remediation and testing phases of the Company's compliance effort 
and upon developments that may arise as the Company continues to 
assess its computer-based systems and operations. In addition, this 
schedule is dependent upon the efforts of third parties, such as 
suppliers (including energy producers) and customers. Accordingly, 
delays by third parties may cause the Company's schedule to change.

The Costs to Address the Company's Year 2000 Issues

Sempra Energy's budget for the Year 2000 program is $48 million, of 
which $40 million has been spent. As the Company continues to assess 
its systems and as the remediation and testing efforts progress, cost 
estimates may change. The Company's Year 2000 readiness effort is 
being funded entirely by operating cash flows.

The Risks of the Company's Year 2000 Issues

Based upon its current assessment and testing of the Year 2000 issue, 
the Company believes the reasonably likely worst case Year 2000 
scenarios to have the following impacts upon Sempra Energy and its 
operations. With respect to the Company's ability to provide energy 
to its domestic utility customers, the Company believes that the 
reasonably likely worst case scenario is for small, localized 
interruptions of utility service which are restored in a time frame 
that is within normal service levels. With respect to services that 
are essential to Sempra Energy's operations, such as customer 
service, business operations, supplies and emergency response 
capabilities, the scenario is for minor disruptions of essential 
services with rapid recovery and all essential information and 
processes ultimately recovered.

To assist in preparing for and mitigating these possible scenarios, 
Sempra Energy is a member of several industry-wide efforts 
established to deal with Year 2000 problems affecting embedded 
systems and equipment used by the nation's natural gas and electric 
power companies. Under these efforts, participating utilities are 
working together to assess specific vendors' system problems and to 
test plans. These assessments will be shared by the industry as a 
whole to facilitate Year 2000 problem solving.

A portion of this risk is due to the various Year 2000 Ready 
schedules of critical third party suppliers and customers. The 
Company continues to contact its critical suppliers and customers to 
survey their Year 2000 remediation programs. While risks related to 
the lack of Year 2000 readiness by third parties could materially and 
adversely affect the Company's business, results of operations and 
financial condition, the Company expects its Year 2000 readiness 
efforts to reduce significantly the Company's level of uncertainty 
about the impact of third party Year 2000 issues on both its IT 
systems and its non-IT systems. 

The Company's Contingency Plans

Sempra Energy's contingency plans for Year-2000-related interruptions 
are being incorporated in the Company's existing overall emergency 
preparedness plans. To the extent appropriate, such plans will 
include emergency backup and recovery procedures, remediation of 
existing systems parallel with installation of new systems, replacing 
electronic applications with manual processes, identification of 
alternate suppliers and increasing inventory levels. These 
contingency plans are well underway and the Company plans to be 
completed by June 30, 1999. Due to the speculative and uncertain 
nature of contingency planning, there can be no assurances that such 
plans actually will be sufficient to reduce the risk of material 
impacts on the Company's operations due to Year 2000 issues.

FACTORS INFLUENCING FUTURE PERFORMANCE

The Company's performance in the near future will primarily depend on 
the results of SDG&E and SoCalGas. Because of the ratemaking and 
regulatory process, electric and natural gas industry restructuring, 
and the changing energy marketplace, there are several factors that 
will influence the Company's future financial performance. These 
factors are discussed in this section and in "Other Operations" and 
"International Operations" below.

KN Energy and Chilquinta Energia S.A. Acquisitions

See discussion of the proposed KN Energy acquisition in Note 2 of the 
notes to Consolidated Financial Statements. See "International 
Operations" below for a discussion of the planned acquisition of 
Chilquinta Energia S.A.

Industry Restructuring 
 
See discussion of industry restructuring in Note 3 of the notes to 
Consolidated Financial Statements.

Electric-Generation Assets and Electric Rates

In November 1997 SDG&E adopted a plan to auction its power plants and 
other electric-generation assets, so that it could continue to 
concentrate its business on the transmission and distribution of 
electricity and natural gas as California opens its electric-utility 
industry to competition. This is described in Note 3 of the notes to 
Consolidated Financial Statements. In addition, the March 1998 CPUC 
decision approving the Enova/PE business combination required, among 
other things, the divestiture by SDG&E of its fossil-fueled 
generation units. The proceeds from the sales will be applied 
directly to SDG&E's transition costs.

As described in Note 3 of the notes to Consolidated Financial 
Statements, AB 1890 requires a 10-percent reduction of residential 
and small commercial customers' rates beginning in January 1998, as 
well as a rate freeze for all customers. The rate freeze could stay 
in place until January 1, 2002. However, SDG&E recently filed with 
the CPUC for an interim mechanism to deal with electric rates after 
the rate freeze ends, noting the possibility that the SDG&E rate 
freeze could end in 1999. If approved, base electric rates (the 
portion of the rate that SDG&E controls) will decrease by an 
additional five percent to 15 percent, depending on the customer 
class, beyond the original 10-percent rate reduction described above. 
The portion of the electric rate representing the commodity cost is 
simply passed through to customers and will fluctuate with the price 
of electricity from the PX. Once the rate freeze is lifted, except 
for the interim protection mechanism described in Note 3 of the notes 
to Consolidated Financial Statements, customers will no longer be 
protected from commodity price spikes. 

Performance-Based Regulation (PBR)

To promote efficient operations and improved productivity and to move 
away from reasonableness reviews and disallowances, the CPUC has been 
directing utilities to use PBR. PBR has replaced the general rate 
case and certain other regulatory proceedings for both SoCalGas and 
SDG&E. Under PBR, regulators require future income potential to be 
tied to achieving or exceeding specific performance and productivity 
goals, as well as cost reductions, rather than relying solely on 
expanding utility rate base in a market where a utility already has a 
highly developed infrastructure. 

SoCalGas' PBR is in effect through December 31, 2002; however, the 
CPUC decision allows for the possibility that changes to the PBR 
mechanism could be adopted in a decision to be issued in SoCalGas' 
1999 Biennial Cost Allocation Proceeding (BCAP) application which is 
anticipated to become effective at year-end 1999. SDG&E continues to 
participate in PBR for its electric and natural gas distribution 
business. During early 1998 SDG&E filed an application with the CPUC 
proposing a new distribution PBR mechanism since the base rate PBR 
mechanism would terminate at the end of 1998. The results of SDG&E's 
1999 Cost of Service study form the basis for the new mechanism's 
starting-point rates. In December 1998, the Cost of Service 
settlement agreement among SDG&E, ORA and UCAN was approved by the 
CPUC, resulting in an authorized revenue increase of $12 million (an 
electric distribution increase of $18 million and a natural gas 
decrease of $6 million). New rates became effective on January 1, 
1999. Also in January 1999, an administrative law judge's proposed 
decision was released on the PBR design issues of SDG&E's 
distribution PBR application. The proposed decision recommends a 
revenue-per-customer indexing mechanism rather than the rate-indexing 
mechanism proposed by SDG&E. Revenue or base margin per customer 
would be indexed based on inflation less an estimated productivity 
factor. The proposed decision also recommends much tighter earnings 
sharing bands than previously in effect for SDG&E. In March 1999, a 
CPUC commissioner issued an alternate decision which, among other 
things, would approve the rate-indexing proposal. On May 13, 1999, 
the CPUC adopted a decision incorporating the rate-indexing 
mechanism.

Cost of Capital

Under PBR, annual Cost of Capital proceedings were replaced by an 
automatic adjustment mechanism if changes in certain indices exceed 
established tolerances. For 1999, SoCalGas is authorized to earn a 
rate of return on common equity (ROE) of 11.6 percent and a 9.49 
percent return on rate base (ROR), unchanged from 1998. For SDG&E, 
electric-industry restructuring is changing the method of calculating 
the utility's annual cost of capital. SDG&E's May 1998 application to 
the CPUC for unbundled rates seeks to establish new, separate rates 
of return for SDG&E's electric distribution and natural gas 
businesses. The application proposes a 12.00 percent ROE, which would 
produce an overall ROR of 9.33 percent.  The ORA, UCAN and other 
intervenors have filed testimony recommending significantly lower 
RORs. A final CPUC decision is expected by mid 1999.

OTHER OPERATIONS

Sempra Energy Solutions (Solutions), formed in 1997 as a joint 
venture of PE and Enova, incorporates several existing unregulated 
businesses from each of PE and Enova. It is pursuing a variety of 
opportunities, including buying and selling natural gas for large 
users, integrated energy-management services targeted at large 
governmental and commercial facilities, and consumer market products 
and services. CES/Way International, Inc. (CES/Way), which was 
acquired by Solutions in January 1998, provides energy-efficiency 
services including energy audits, engineering design, project 
management, construction, financing and contract maintenance.

Solutions' net losses were $8 million and $9 million for the three-
month periods ended March 31, 1999 and 1998. The losses are primarily 
due to start-up costs.

Sempra Energy Trading Corp. (SET), a leading natural gas power 
marketing firm headquartered in Stamford, Connecticut, was jointly 
acquired by PE and Enova on December 31, 1997. For the three-month 
period ended March 31, 1999, SET recorded after-tax income of $1 
million, compared to a net loss of $7 million in the first quarter of 
1998. The increase in income was primarily due to SET's acquisition 
of CNG Energy Services Corporation, a subsidiary of Pittsburgh-based 
Consolidated Natural Gas Company, in July 1998. [P] Effective April 
1999, PE transferred its ownership interest in SET to Sempra Energy.

INTERNATIONAL OPERATIONS

On April 13, 1999 Sempra Energy announced that the board of directors 
of Chilquinta S.A. approved an offer by Sempra Energy and Public 
Service Enterprise Group (PSEG) to acquire, under a 50-50 
partnership, the shares of Chilquinta S.A.'s subsidiary, Chilquinta 
Energia S.A., for $830 million. The acquisition will be funded by 
$510 million in equity provided equally by the two partners and $320 
million in non-recourse debt provided by a syndicate of banks at the 
time of closing. Chilquinta S.A., a leading energy company based in 
Santiago, Chile, has operations in Chile, Argentina and Peru. The 
combination remains subject to approval by Chilquinta Energia's 
shareholders and regulatory notifications in Chile and is expected to 
close in mid 1999.

The net losses for international operations for the three-month 
periods ended March 31, 1999 and 1998 were $2 million and $3 million, 
respectively. The losses are primarily due to expenses related to the 
evaluation of international opportunities. 

PART II - OTHER INFORMATION 

ITEM 1.   LEGAL PROCEEDINGS 
 
Except for the matters referred to in the Company's 1998 Annual 
Report or referred to elsewhere in this Quarterly Report on Form 10-Q 
for the three months ended March 31, 1999, neither the Company nor 
any of its affiliates is a party to, nor is its property the subject 
of, any material pending legal proceedings other than routine 
litigation incidental to its businesses.

ITEM 4.  SUBMISSION OF MATTERS TO VOTE

Sempra Energy's 16-member board of directors is divided into three 
classes whose terms are staggered so that the term of one class 
expires at each Annual Meeting of Shareholders. At the annual meeting 
on May 4, 1999, the shareholders of Sempra Energy elected five 
directors for a three-year term expiring in 2002. The name of each 
nominee and the number of shares voted for or withheld were as 
follows:

Nominees                    Votes For           Votes Withheld
- -------------------------------------------------------------------
Hyla H. Bertea             203,205,326            8,544,424
Ann L. Burr                203,353,651            8,396,099
Richard A. Collato         203,347,298            8,402,452
Daniel W. Derbes           203,341,955            8,407,795
Ignacio E. Lozano, Jr.     202,892,606            8,857,144


The results of the voting on the following additional items, all of 
which were approved, were as follows:

(a)  A proposal to approve a Non-Employee Directors' Stock Plan.

     In Favor              147,829,901
     Opposed                26,325,417
     Abstained               5,762,468
     Broker Non-Vote        31,831,964

(b)  A proposal to approve an Executive Incentive Plan for 
     executive officers.

     In Favor              182,329,656
     Opposed                23,468,861
     Abstained               5,951,233

(c)  A proposal to approve a Long Term Incentive Plan for officers 
     and other key employees of Sempra Energy and its subsidiaries. 

     In Favor               96,458,669
     Opposed                77,611,943
     Abstained               5,847,175
     Broker Non-Vote        31,831,963

Additional information concerning the election of the board of 
directors and the other proposals is contained in Sempra Energy's 
Notice of 1999 Annual Meeting of Shareholders and Proxy Statement.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K 
 
(a)   Exhibits  

      Exhibit 2 - Plan of acquisition

2.1 Agreement and Plan of Merger, dated as of February 20,
      1999, among Sempra Energy, Cardinal Acquisition Corp. and KN 
      Energy, Inc. (incorporated by reference to Exhibit 2.1 to 
      Current Report on Form 8-K filed by Sempra Energy with the
      Securities and Exchange Commission on February 23, 1999).
 
      Exhibit 10 - Material Contracts - Compensation

      10.1  Form of Sempra Energy Severance Pay Agreement

      Exhibit 12 - Computation of ratios 
 
      12.1  Computation of Ratio of Earnings to Combined Fixed
      Charges and Preferred Stock Dividends. 
 
      Exhibit 27 - Financial Data Schedules 
 
      27.1  Financial Data Schedule for the three months ended 
      March 31, 1999. 


(b)   Reports on Form 8-K 

      A Current Report on Form 8-K filed February 23, 1999 
      announced the agreement entered into by Sempra Energy, 
      Cardinal Acquisition Corp. and KN Energy, Inc. to merge 
      KN Energy, Inc. with and into Cardinal Acquisition Corp.,
      a wholly owned subsidiary of Sempra Energy.

      A Current Report on Form 8-K filed April 2, 1999 announced 
      the early termination of the waiting period under the Hart-
      Scott-Rodino Antitrust Improvements Act of 1976, as amended,
      with respect to the proposed acquisition of KN Energy.

      A Current Report on Form 8-K filed April 14, 1999 announced 
      the approval by Chilquinta S.A.'s board of directors of the 
      offer by Sempra Energy and Public Service Enterprise Group to 
      acquire, on a 50-50 basis, Chilquinta S.A.'s subsidiary, 
      Chilquinta Energia S.A.

      A Current Report on Form 8-K filed May 5, 1999 announced that
      Sempra Energy Holdings would be filing a shelf registration
      of debt securities to be offered pursuant to Rule 415 under 
      the Securities Act of 1933 and provided certain financial 
      information for Sempra Energy Holdings. 







SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, 
the registrant has duly cause this report to be signed on its behalf 
by the undersigned thereunto duly authorized.


                                          SEMPRA ENERGY
                                       -------------------
                                           (Registrant)





                                   
Date: May 14, 1999               By:       /s/ F. H. Ault
                                       ----------------------------
                                               F. H. Ault
                                      Vice President and Controller








  

UT THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE STATEMENT OF CONSOLIDATED INCOME, BALANCE SHEET, AND CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 0001032208 SEMPRA ENERGY 1,000,000 3-MOS DEC-31-1999 MAR-31-1999 PER-BOOK 5,189 1,281 2,488 1,234 340 10,532 1,841 0 1,080 2,921 25 179 2,700 38 0 0 343 0 62 6 4,258 10,532 1,169 63 971 1,034 135 22 157 58 99 0 99 94 0 448 0.42 0.42 PREFERRED DIVIDEND OF SUBSIDIARY INCLUDED IN OTHER OPERATING EXPENSE
                                            EXHIBIT 10.1 
SEMPRA ENERGY 
SEVERANCE PAY AGREEMENT 
 
THIS AGREEMENT (this "Agreement"), dated as of December 1, 1998 (the 
"Effective Date") is made by and between SEMPRA ENERGY, a California 
corporation, and __________________ (the "Executive"). 
WHEREAS, the Executive is currently employed by Sempra Energy or a 
subsidiary of Sempra Energy (Sempra Energy and its subsidiaries are 
hereinafter collectively referred to as the "Company") as ______ 
(Title); and 
WHEREAS, the Board of Directors of Sempra Energy (the "Board") has 
determined that it is in the best interests of the Company to 
institute formalized severance arrangements for certain of the 
executives of the Company, including the Executive. 
NOW, THEREFORE, in consideration of the premises and mutual covenants 
herein contained, the Company and the Executive hereby agree as 
follows: 
Section 1. Definitions.  For purposes of this Agreement, the 
following capitalized terms have the meanings set forth below: 
"Affiliate" has the meaning ascribed to such term in Rule 12b-2 
promulgated under the Exchange Act. 
"Beneficial Owner" has the meaning set forth in Rule 13d-3 under the 
Exchange Act. 
"Cause" means (i) the willful and continued failure by the Executive 
to substantially perform the Executive's duties with the Company 
(other than any such failure resulting from the Executive's 
incapacity due to physical or mental illness or any such actual or 
anticipated failure after the issuance of a Notice of Termination for 
Good Reason by the Executive pursuant to Section 2 hereof), or (ii) 
the Executive's commission of one or more acts of moral turpitude 
that constitute a violation of applicable law (including but not 
limited to a felony) which have or result in an adverse effect on the 
Company, monetarily or otherwise, or one or more significant acts of 
dishonesty.  For purposes of clause (i) of this definition, no act, 
or failure to act, on the Executive's part shall be deemed "willful" 
unless done, or omitted to be done, by the Executive not in good 
faith and without reasonable belief that the Executive's act, or 
failure to act, was in the best interests of the Company.  
Notwithstanding the foregoing, the Executive shall not be deemed 
terminated for Cause pursuant to clause (i) of this definition unless 
and until the Executive shall have been provided with reasonable 
notice of and, if possible, a reasonable opportunity to cure the 
facts and circumstances claimed to provide a basis for termination of 
the Executive's employment for Cause. 
A "Change in Control" of Sempra Energy shall be deemed to have 
occurred when: 
(a) Any Person is or becomes the Beneficial Owner, directly or 
indirectly, of securities of Sempra Energy representing twenty 
percent (20%) or more of the combined voting power of Sempra Energy's 
then outstanding securities; or  
 
(b) The following individuals cease for any reason to constitute a 
majority of the number of directors then serving: individuals who, on 
the Effective Date, constitute the Board and any new director (other 
than a director whose initial assumption of office is in connection 
with an actual or threatened election contest, including, but not 
limited to, a consent solicitation, relating to the election of 
directors of Sempra Energy) whose appointment or election by the 
Board or nomination for election by Sempra Energy's shareholders was 
approved or recommended by a vote of at least two-thirds (2/3) of the 
directors then still in office who either were directors on the date 
hereof or whose appointment, election or nomination for election was 
previously so approved or recommended; or  
 
(c) There is consummated a merger or consolidation of Sempra Energy 
or any direct or indirect subsidiary of Sempra Energy with any other 
corporation, other than (A) a merger or consolidation which would 
result in the voting securities of Sempra Energy outstanding 
immediately prior to such merger or consolidation continuing to 
represent (either by remaining outstanding or by being converted into 
voting securities of the surviving entity or any parent thereof), in 
combination with the ownership of any trustee or other fiduciary 
holding securities under an employee benefit plan of Sempra Energy or 
any subsidiary of Sempra Energy, at least sixty percent (60%) of the 
combined voting power of the securities of Sempra Energy or such 
surviving entity or any parent thereof outstanding immediately after 
such merger or consolidation, or (B) a merger or consolidation 
effected to implement a recapitalization of Sempra Energy (or similar 
transaction) in which no Person is or becomes the Beneficial Owner, 
directly or indirectly, of securities of Sempra Energy (not including 
in the securities beneficially owned by such Person any securities 
acquired directly from Sempra Energy or its affiliates other than in 
connection with the acquisition by Sempra Energy or its affiliates of 
a business) representing twenty percent (20%) or more of the combined 
voting power of Sempra Energy's then outstanding securities; or 
 
(d) The shareholders of Sempra Energy approve a plan of complete 
liquidation or dissolution of Sempra Energy or there is consummated 
an agreement for the sale or disposition by Sempra Energy of all or 
substantially all of Sempra Energy's assets, other than a sale or 
disposition by Sempra Energy of all or substantially all of Sempra 
Energy's assets to an entity, at least sixty percent (60%) of the 
combined voting power of the voting securities of which are owned by 
shareholders of Sempra Energy in substantially the same proportions 
as their ownership of Sempra Energy immediately prior to such sale. 
"Change in Control Date" means the date on which a Change in Control 
occurs. 
"Code" means the Internal Revenue Code of 1986, as amended. 
"Date of Termination" has the meaning assigned thereto in Section 2 
hereof. 
"Disability" has the meaning set forth in the SERP (as defined 
below), as in effect from time to time; provided, however, that in no 
event shall the Executive be deemed to have incurred a Disability 
hereunder if there exists a reasonable expectation that the Executive 
will return to work on a full-time basis within ninety (90) days of 
the events giving rise to the Disability. 
"Exchange Act" means the Securities Exchange Act of 1934, as amended, 
and the applicable rulings and regulations thereunder. 
"Good Reason" means: 
(a) Prior to a Change in Control, the occurrence of any of the 
following without the prior written consent of the Executive, unless 
such act or failure to act is corrected prior to the Date of 
Termination specified in the Notice of Termination (as discussed in 
Section 2 below): 
(I) the assignment to the Executive of any duties materially 
inconsistent with the range of duties and responsibilities 
appropriate to a senior executive within the Company (such range 
determined by reference to past, current and reasonable practices 
within the Company); 
(ii) a material reduction in the Executive's overall standing and 
responsibilities within the Company, but not including (A) a mere 
change in title, or (B) a transfer within Company, which, in the case 
of both (A) and (B), does not adversely affect the Executive's 
overall status within the Company; 
(iii) a material reduction by the Company in the Executive's 
aggregate annualized compensation and benefits opportunities, except 
for across-the-board reductions (or modifications of benefit plans) 
similarly affecting all similarly situated executives (both of the 
Company and of any Person then in control of the Company) of 
comparable rank with the Executive; 
(iv) the failure by the Company to pay to the Executive any portion 
of the Executive's current compensation and benefits or any portion 
of an installment of deferred compensation under any deferred 
compensation program of the Company within thirty (30) days of the 
date such compensation is due; 
 (v) any purported termination of the Executive's employment that is 
not effected pursuant to a Notice of Termination satisfying the 
requirements of Section 2 hereof; for purposes of this Agreement, no 
such purported termination shall be effective; 
(vi) the failure by the Company to obtain a satisfactory agreement 
from any successor of the Company requiring such successor to assume 
and agree to perform the Company's obligations under this Agreement, 
as contemplated in Section 8(a) hereof; or 
(vii) the failure by the Company to comply with any material 
provision of this Agreement. 
(b) From and after a Change in Control, the occurrence of any of 
the following without the prior written consent of the Executive, 
unless such act or failure to act is corrected prior to the Date of 
Termination specified in the Notice of Termination (as discussed in 
Section 2 below): 
(I) an adverse change in the Executive's title, authority, duties, 
responsibilities or reporting lines as in effect immediately prior to 
the Change in Control; 
(ii) a reduction of ten percent (10%) or more by the Company in the 
Executive's aggregate annualized compensation and benefits 
opportunities, except for across-the-board reductions (or 
modifications of benefit plans) of less than ten percent (10%) 
similarly affecting all similarly situated executives (both of the 
Company and of any Person then in control of the Company) of 
comparable rank with the Executive; 
(iii) the relocation of the Executive's principal place of employment 
immediately prior to the Change in Control Date (the "Principal 
Location") to a location which is both further away from Executive's 
residence and more than thirty (30) miles from such Principal 
Location, or the Company's requiring the Executive to be based 
anywhere other than such Principal Location (or permitted relocation 
thereof), or a substantial increase in the Executive's business 
travel obligations outside of the Southern California area as of the 
Effective Date other than any such increase that (A) arises in 
connection with extraordinary business activities of the Company and 
(B) is understood not to be part of the Executive's regular duties 
with the Company;  
(iv) the failure by the Company to pay to the Executive any portion 
of the Executive's current compensation and benefits or any portion 
of an installment of deferred compensation under any deferred 
compensation program of the Company within thirty (30) days of the 
date such compensation is due; 
(v) any purported termination of the Executive's employment that is 
not effected pursuant to a Notice of Termination satisfying the 
requirements of Section 2 hereof; for purposes of this Agreement, no 
such purported termination shall be effective; 
(vi) the failure by the Company to obtain a satisfactory agreement 
from any successor of the Company requiring such successor to assume 
and agree to perform the Company's obligations under this Agreement, 
as contemplated in Section 8(a) hereof; or 
(vii) the failure by the Company to comply with any material 
provision of this Agreement. 
From and after a Change in Control, the Executive's determination 
that an act or failure to act constitutes Good Reason shall be 
presumed to be valid unless such determination is deemed to be 
unreasonable by an arbitrator.  The Executive's right to terminate 
the Executive's employment for Good Reason shall not be affected by 
the Executive's incapacity due to physical or mental illness.  The 
Executive's continued employment shall not constitute consent to, or 
a waiver of rights with respect to, any act or failure to act 
constituting Good Reason hereunder. 
"Involuntary Termination" means (a) a termination of employment by 
the Company other than for Cause, death, or Disability, or (b) the 
Executive's resignation of employment with the Company for Good 
Reason; provided, however, that, except as provided in the last 
paragraph of Section 4, a termination of the Executive's employment 
by reason of his or her retirement prior to a Change in Control shall 
not constitute an Involuntary Termination hereunder. 
"Notice of Termination" has the meaning assigned thereto in Section 2 
hereof. 
"Person" means any person, entity or "group" within the meaning of 
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, except that 
such term shall not include (i) the Company or any of its Affiliates, 
(ii) a trustee or other fiduciary holding securities under an 
employee benefit plan of the Company or any of its Affiliates, (iii) 
an underwriter temporarily holding securities pursuant to an offering 
of such securities, (iv) a corporation owned, directly or indirectly, 
by the shareholders of Sempra Energy in substantially the same 
proportions as their ownership of stock of Sempra Energy, or (v) a 
person or group as used in Rule 13d-1(b) under the Exchange Act. 
Section 2. Date and Notice of Termination.  Any termination of the 
Executive's employment by the Company or by the Executive shall be 
communicated by a written notice of termination to the other party 
(the "Notice of Termination").  Where applicable, the Notice of 
Termination shall indicate the specific termination provision in this 
Agreement relied upon and shall set forth in reasonable detail the 
facts and circumstances claimed to provide a basis for termination of 
the Executive's employment under the provision so indicated.  The 
date of the Executive's termination of employment with the Company 
(the "Date of Termination") shall be determined as follows:  (i) if 
the Executive's employment is terminated by the Company, either with 
or without Cause, the Date of Termination shall be the date specified 
in the Notice of Termination (which, in the case of a termination by 
the Company other than for Cause, shall not be less than two (2) 
weeks from the date such Notice of Termination is given unless the 
Company elects to pay the Executive, in addition to any other amounts 
payable hereunder, an amount equal to two (2) weeks of the 
Executive's base salary in effect on the Date of Termination), and 
(ii) if the basis for the Executive's Involuntary Termination is his 
or her resignation for Good Reason, the Date of Termination shall be 
determined by the Company, but shall not in any event be less than 
fifteen (15) days nor more than sixty (60) days from the date such 
Notice of Termination is given.  Unless the Board determines 
otherwise, notice by Executive of his or her resignation for Good 
Reason must be made within 180 days of the act or failure to act the 
Executive alleges to constitute Good Reason.  
Section 3. Severance Benefits Prior to Change in Control.  Except as 
provided in Section 4 and Section 12(g) hereof, in the event of the 
Involuntary Termination of the Executive, the Company shall pay the 
Executive, in one lump sum cash payment as soon as practicable 
following such Involuntary Termination, (A) the full amount of any 
earned but unpaid base salary through the Date of Termination at the 
rate in effect on such date, plus (B) an amount (the "Severance 
Payment") equal to the sum of (X) the Executive's annual base salary 
as in effect on the Date of Termination and (Y) his or her average 
annual bonus payment for the two years immediately preceding the Date 
of Termination (or in the event that the Executive has not been 
employed for two years, then his target bonus for the year in which 
the termination occurs).  In addition to the Severance Payment, the 
Executive shall be entitled to the following additional benefits: 
(I) Equity Based Compensation.  The Executive shall retain all 
rights to any equity-based compensation awards to the extent set 
forth in the applicable plan and/or award agreement. 
(ii) Welfare Benefits.  Subject to Section 6 below, for a period of 
______ following the Date of Termination, the Executive and his or 
her dependents shall be provided with health insurance benefits 
substantially similar to those provided to the Executive and his or 
her dependents immediately prior to the Date of Termination; 
provided, however, that such benefits shall be provided on 
substantially the same terms and conditions and at the same cost to 
the Executive as in effect immediately prior to the Date of 
Termination. 
(iii) Outplacement Services.  The Executive shall receive 
outplacement services suitable to his or her position for a period of 
eighteen (18) months following the Date of Termination, or if 
earlier, until the first acceptance of an offer of employment with a 
subsequent employer, in an aggregate amount not to exceed $50,000. 
(iv) Financial Planning Services.  The Executive shall receive 
financial planning services for a period of eighteen (18) months 
following the Date of Termination at a level consistent with the 
benefits provided under the Company's financial planning program for 
the Executive, as in effect immediately prior to the Date of 
Termination. 
Section 4. Severance Benefits in Connection with and After Change in 
Control.  Notwithstanding the provisions of Section 3 above, in the 
event of the Involuntary Termination of the Executive within two 
years following a Change in Control, in lieu of the payments 
described in Section 3 above, the Company shall pay the Executive, in 
one lump sum cash payment as soon as practicable following such 
Involuntary Termination, (A) the full amount of any earned but unpaid 
base salary through the Date of Termination at the rate in effect on 
such date, plus (B) an amount (the "Change in Control Severance 
Payment") equal to ____ the sum of (X) the Executive's annual base 
salary as in effect immediately prior to the Change in Control or the 
Date of Termination, whichever is greater, and (Y) his or her average 
annual bonus payment for the two years immediately preceding the 
Change in Control Date or the Date of Termination, whichever is 
greater (or in the event that the Executive has not been employed for 
two years, then his target bonus for the year in which the Change in 
Control or in which the termination occurs, whichever is greater).  
In addition to the Change in Control Severance Payment, the Executive 
shall be entitled to the following additional benefits: 
(I) Equity-Based Compensation.  Notwithstanding the provisions of 
any applicable equity-compensation plan or award agreement to the 
contrary, all equity-based incentive compensation awards (including, 
without limitation, stock options, stock appreciation rights, 
restricted stock awards, restricted stock units, performance share 
awards, section 162(m) awards, and dividend equivalents) held by the 
Executive under any annual incentive compensation plan or long-term 
incentive compensation plan maintained by the Company shall 
immediately vest and become exercisable or payable, as the case may 
be, as of the Date of Termination, to be exercised or paid, as the 
case may be, in accordance with the terms of the applicable plan and 
award agreement, and any restrictions on any such awards shall 
automatically lapse; provided, however, that any such awards granted 
on or after the Effective Date shall remain outstanding and 
exercisable until the earlier of (A) eighteen (18) months following 
the Date of Termination or (B) the expiration of the original term of 
such award (it being understood that all awards granted prior to the 
Effective Date shall remain outstanding and exercisable for a period 
that is no less than that provided for in the applicable agreement in 
effect as of the date of grant). 
(ii) SERP.  The Executive shall receive a lump sum cash payment 
representing the present value as of the Date of Termination of his 
or her Supplemental Executive Retirement Plan ("SERP") benefits, to 
be calculated as if the Executive had reached age 62 (or his or her 
actual age if older) for service and vesting purposes, and applying 
either the applicable early retirement factors under the Company's 
tax-qualified retirement plan, if the Executive is less than age 62 
but at least 55, or actuarially determined early retirement factors 
if the Executive is less than age 55 and the applicable lump-sum 
factors under the Company's tax-qualified retirement plan. 
(iii) Welfare Benefits.  Subject to Section 6 below, for a period of 
_____ months following the Date of Termination, the Executive and his 
or her dependents shall be provided with life, disability, accident 
and health insurance benefits substantially similar to those provided 
to the Executive and his or her dependents immediately prior to the 
Date of Termination or the Change in Control Date, whichever is more 
favorable to the Executive; provided, however, that such benefits 
shall be provided on substantially the same terms and conditions and 
at the same cost to the Executive as in effect immediately prior to 
the Date of Termination or the Change in Control Date, whichever is 
more favorable to the Executive. 
(iv) Outplacement Services.  The Executive shall receive 
outplacement services suitable to his or her position for a period of 
eighteen (18) months following the Date of Termination, or if 
earlier, until the first acceptance of an offer of employment with a 
subsequent employer, in an aggregate amount not to exceed $50,000. 
(v) Financial Planning Services.  The Executive shall receive 
financial planning services for a period of eighteen (18) months 
following the Date of Termination at a level consistent with the 
benefits provided under the Company's financial planning program for 
the Executive, as in effect immediately prior to the Date of 
Termination or the Change in Control Date, whichever is more 
favorable to the Executive. 
(vi) Deferred Compensation.  Notwithstanding any election heretofore 
or hereafter made by the Executive under any deferred compensation 
plan of the Company, the Executive shall receive a lump sum cash 
payment in an amount equal to any compensation previously deferred by 
the Executive (together with any accrued interest or earnings 
thereon) under any deferred compensation plan of the Company. 
Notwithstanding anything contained herein, if a Change in Control 
occurs and the Executive's employment with the Company is terminated 
by reason of an Involuntary Termination prior to the Change in 
Control Date, and if such termination of employment (i) was at the 
request of a third party who has taken steps reasonably calculated to 
effect the Change in Control or (ii) otherwise arose in connection 
with or in anticipation of the Change in Control, then the Executive 
shall, in lieu of the payments described in Section 3 above, be 
entitled to the Change in Control Severance Payment and the 
additional benefits described in this Section 4 as if such 
Involuntary Termination had occurred within two years following the 
Change in Control. 
Section 5. Release.  Notwithstanding anything herein to the 
contrary, the Company's obligation to make the payments provided for 
in this Agreement is expressly made subject to and conditioned upon 
(i) the Executive's prior execution of a release substantially in the 
form attached hereto as Exhibit A within forty-five (45) days after 
the applicable Date of Termination and (ii) the Executive's non-
revocation of such release in accordance with the terms thereof. 
Section 6. No Mitigation or Offset.   
(a) No Mitigation by Executive.  Except as otherwise expressly 
provided herein, the Executive shall not be required to mitigate the 
amount of any payment provided for in this Agreement by seeking other 
employment or otherwise, nor shall the amount of any payment provided 
for herein be reduced by any compensation earned by the Executive as 
the result of employment by another employer; provided, however, that 
if the Executive becomes employed with another employer and is 
eligible to receive life, disability, accident and health insurance 
benefits under another employer-provided plan, the Executive's 
continued plan coverage as set forth in Section 3(ii) or 4(iii) 
hereof, as the case may be, shall be secondary to the coverage 
provided under such other plan(s) during such applicable period of 
eligibility. 
(b) No Offset by Company.  The Company's obligation to make the 
payments provided for in this Agreement and otherwise to perform its 
obligations hereunder shall not be affected by any set-off, 
counterclaim, recoupment, defense or other claim, right or action 
which the Company may have against the Executive or others, provided 
that nothing herein shall preclude the Company from separately 
pursuing recovery from the Executive based on any such claim. 
Section 7. Section 280G 
(a) Gross-Up.  Notwithstanding any other provisions of this 
Agreement, in the event that any payment or benefit received or to be 
received by the Executive (whether pursuant to the terms of this 
Agreement or any other plan, arrangement or agreement with (A) the 
Company, (B) any Person whose actions result in a Change in Control 
or (C) any Person affiliated with the Company or such Person) (all 
such payments and benefits, including the Change in Control Severance 
Payments, being hereinafter called the "Total Payments") would be 
subject (in whole or part) to the tax (the "Excise Tax") imposed 
under section 4999 of the Code, the Company shall pay to the 
Executive such additional amounts (the "Gross-Up Payment") such that 
the net amount retained by the Executive, after deduction of any 
Excise Tax on the Total Payments and any federal, state and local 
income and employment taxes and Excise Tax upon the Gross-Up Payment, 
shall be equal to the Total Payments.  For purposes of determining 
the amount of the Gross-Up Payment, the Executive shall be deemed to 
pay federal income tax at the highest marginal rate of federal income 
taxation in the calendar year in which the Gross-Up Payment is to be 
made and state and local income taxes at the highest marginal rate of 
taxation in the state and locality of the Executive's residence on 
the date on which the Gross-Up Payment is calculated for purposes of 
this section, net of the maximum reduction in federal income taxes 
which could be obtained from deduction of such state and local taxes.  
In the event that the Excise Tax is subsequently determined to be 
less than the amount taken into account hereunder, the Executive 
shall repay to the Company, at the time that the amount of such 
reduction in Excise Tax is finally determined, the portion of the 
Gross-Up Payment attributable to such reduction (plus that portion of 
the Gross-Up Payment attributable to the Excise Tax and federal, 
state and local income tax imposed on the Gross-Up Payment being 
repaid by the Executive to the extent that such repayment results in 
a reduction in Excise Tax and/or a federal, state or local income tax 
deduction) plus interest on the amount of such repayment at the rate 
provided in section 1274(b)(2)(B) of the Code.  In the event that the 
Excise Tax is determined to exceed the amount taken into account 
hereunder (including by reason of any payment the existence or amount 
of which cannot be determined at the time of the Gross-Up Payment), 
the Company shall make an additional Gross-Up Payment in respect of 
such excess (plus any interest, penalties or additions payable by the 
Executive with respect to such excess) at the time that the amount of 
such excess is finally determined.  The Executive and the Company 
shall each reasonably cooperate with the other in connection with any 
administrative or judicial proceedings concerning the existence or 
amount of liability for Excise Tax with respect to the Total 
Payments. 
(b) Accounting Firm.  All determinations to be made with respect to 
this Section 7 shall be made by the Company's independent accounting 
firm (or, in the case of a payment following a Change in Control, the 
accounting firm that was, immediately prior to the Change in Control, 
the Company's independent auditor).  The accounting firm shall be 
paid by the Company for its services performed hereunder. 
Section 8. Successors; Binding Agreement. 
(a) Assumption by Successor.  Sempra Energy will require any 
successor (whether direct or indirect, by purchase, merger, 
consolidation or otherwise) to all or substantially all of the 
business or assets of Sempra Energy expressly to assume and to agree 
to perform its obligations under this Agreement in the same manner 
and to the same extent that Sempra Energy would be required to 
perform such obligations if no such succession had taken place; 
provided, however, that no such assumption shall relieve Sempra 
Energy of its obligations hereunder.  As used herein, the "Company" 
shall mean the Company as hereinbefore defined and any successor to 
its business and/or assets as aforesaid that assumes and agrees to 
perform its obligations by operation of law or otherwise. 
(b) Enforceability; Beneficiaries.  This Agreement shall be binding 
upon and inure to the benefit of the Executive (and the Executive's 
personal representatives and heirs) and the Company and any 
organization which succeeds to substantially all of the business or 
assets of Sempra Energy, whether by means of merger, consolidation, 
acquisition of all or substantially all of the assets of Sempra 
Energy or otherwise, including, without limitation, as a result of a 
Change in Control or by operation of law.  This Agreement shall inure 
to the benefit of and be enforceable by the Executive's personal or 
legal representatives, executors, administrators, successors, heirs, 
distributees, devisees and legatees.  If the Executive should die 
while any amount would still be payable to such Executive hereunder 
if he or she had continued to live, all such amounts, unless 
otherwise provided herein, shall be paid in accordance with the terms 
of this Agreement to his or her devisee, legatee or other designee 
or, if there is no such designee, to his or her estate. 
Section 9. Confidentiality; Non Solicitation. 
(a) Confidentiality.  The Executive acknowledges that in the course 
of his or her employment within the Company, he or she has acquired 
non-public privileged or confidential information and trade secrets 
concerning the operations, future plans and methods of doing business 
("Proprietary Information") of the Company; and the Executive agrees 
that it would be extremely damaging to the Company if such 
Proprietary Information were disclosed to a competitor of the Company 
or to any other person or corporation.  The Executive understands and 
agrees that all Proprietary Information the Executive has acquired 
during the course of such employment has been divulged to the 
Executive in confidence and further understands and agrees to keep 
all Proprietary Information secret and confidential (except for such 
information which is or becomes publicly available other than as a 
result of a breach by the Executive of this provision) without 
limitation in time.  In view of the nature of the Executive's 
employment and the Proprietary Information the Executive has acquired 
during the course of such employment, the Executive likewise agrees 
that the Company would be irreparably harmed by any disclosure of 
Proprietary Information in violation of the terms of this paragraph 
and that the Company shall therefore be entitled to preliminary 
and/or permanent injunctive relief prohibiting the Executive from 
engaging in any activity or threatened activity in violation of the 
terms of this paragraph and to any other judicial relief available to 
it.  Inquiries regarding whether specific information constitutes 
Proprietary Information shall be directed to the Company's General 
Counsel (or, if such position is vacant, the Company's Chief 
Executive Officer); provided, however, that the Company shall not 
unreasonably classify information as Proprietary Information. 
(b) Non-Solicitation of Employees.  The Executive recognizes that 
he or she possesses and will possess confidential information about 
other employees of the Company, relating to their education, 
experience, skills, abilities, compensation and benefits, and 
interpersonal relationships with customers of the Company.  The 
Executive recognizes that the information he or she possesses and 
will possess about these other employees is not generally known, is 
of substantial value to the Company in developing their business and 
in securing and retaining customers, and has been and will be 
acquired by him or her because of his or her business position within 
the Company.  The Executive agrees that for a period of one (1) year 
following the Date of Termination, he or she will not, directly or 
indirectly, solicit or recruit any employee of the Company for the 
purpose of being employed by him or her or by any other competitor of 
the Company on whose behalf he or she is acting as an agent, 
representative or employee and that he or she will not convey any 
such confidential information or trade secrets about other employees 
of the Company to any other person; provided, however, that it shall 
not constitute a solicitation or recruitment of employment in 
violation of this paragraph to discuss employment opportunities with 
any employee of the Company who has either first contacted the 
Executive or regarding whose employment the Executive has discussed 
with and received written approval of the Company's Senior Vice 
President, Human Resources (or, if such position is vacant, the 
Company's Chief Executive Officer), prior to making such solicitation 
or recruitment.  In view of the nature of the Executive's employment 
with the Company, the Executive likewise agrees that the Company 
would be irreparably harmed by any solicitation or recruitment in 
violation of the terms of this paragraph and that the Company shall 
therefore be entitled to preliminary and/or permanent injunctive 
relief prohibiting the Executive from engaging in any activity or 
threatened activity in violation of the terms of this paragraph and 
to any other judicial relief available to it. 
(c) Survival of Provisions.  The obligations contained in this 
Section 9 shall survive the termination or expiration of the 
Executive's employment within the Company and shall be fully 
enforceable thereafter.  If it is determined by a court of competent 
jurisdiction in any state that any restriction in this Section 9 is 
excessive in duration or scope or is unreasonable or unenforceable 
under the laws of that state, it is the intention of the parties that 
such restriction may be modified or amended by the court to render it 
enforceable to the maximum extent permitted by the law of that state. 
Section 10. Notices.  For the purpose of this Agreement, notices and 
all other communications provided for in this Agreement shall be in 
writing and shall be deemed to have been duly given when delivered or 
mailed by United States registered mail, return receipt requested, 
postage prepaid, addressed to Sempra Energy, 101 Ash Street, San 
Diego, CA 92101, Attn: Human Resources Administrator, or to the 
Executive at the address in the records of the Company, or to such 
other address as either party may have furnished to the other in 
writing in accordance herewith, except that notice of change of 
address shall be effective only upon receipt. 
Section 11. Administration Prior to Change in Control.  Prior to a 
Change in Control, the compensation committee of the Board (the 
"Compensation Committee") shall have full and complete authority to 
construe and interpret the provisions of this Agreement, to determine 
an individual's entitlement to benefits under this Agreement, to make 
in its sole and absolute discretion all determinations contemplated 
under this Agreement, to investigate and make factual determinations 
necessary or advisable to administer or implement this Agreement, and 
to adopt such rules and procedures as it deems necessary or advisable 
for the administration or implementation of this Agreement.  All 
determinations made under this Agreement by the Compensation 
Committee shall be final and binding on all interested persons.  
Prior to a Change in Control, the Compensation Committee may delegate 
responsibilities for the operation and administration of this 
Agreement to one or more officers or employees of the Company.  The 
provisions of this Section 11 shall terminate and be of no further 
force and effect upon the occurrence of a Change in Control. 
Section 12. Miscellaneous. 
(a) No Right of Employment.  Nothing in this Agreement shall be 
construed as giving the Executive any right to be retained in the 
employ of the Company or shall interfere in any way with the right of 
the Company to terminate the Executive's employment at any time, with 
or without Cause. 
(b) Unfunded Obligation.  The obligations under this Agreement 
shall be unfunded.  Benefits payable under this Agreement shall be 
paid from the general assets of the Company.  The Company shall have 
no obligation to establish any fund or to set aside any assets to 
provide benefits under this Agreement. 
(c) Rules of Construction.  As used herein, the masculine gender 
shall be deemed to include the feminine and the singular form shall 
be deemed to encompass the plural, unless the context requires 
otherwise.  Headings of sections (other than the definitions) are 
included solely for convenience of reference and shall not govern or 
control the meaning of the text of this Agreement.  The invalidity or 
unenforceability of any provision of this Agreement shall not affect 
the validity or enforceability of any other provision of this 
Agreement, which shall remain in full force and effect. 
(d) Tax Withholding.  All amounts paid under this Agreement shall 
be subject to all applicable federal, state and local wage and 
employment tax withholding. 
(e) Exclusive Benefit.  The Severance Payment, the Change in 
Control Severance Payment and all other benefits provided hereunder 
shall be in lieu of any other severance payments to which the 
Executive is entitled under any other severance plan or arrangement 
sponsored by the Company, as well as pursuant to any individual 
employment or severance agreement that was entered by the Executive 
and the Company, and, upon the Effective Date of this Agreement, all 
such plans, programs, agreements and arrangements are hereby 
automatically superseded and terminated. 
(f) Dispute Resolution.  Any disagreement, dispute, controversy or 
claim arising out of or relating to this Agreement or the 
interpretation of this Agreement or any arrangements relating to this 
Agreement or contemplated in this Agreement or the breach, 
termination or invalidity thereof shall be settled by final and 
binding arbitration administered by JAMS/Endispute in San Diego, 
California in accordance with the then existing JAMS/Endispute 
Arbitration Rules and Procedures for Employment Disputes.  In the 
event of such an arbitration proceeding, the Executive and the 
Company shall select a mutually acceptable neutral arbitrator from 
among the JAMS/Endispute panel of arbitrators.  In the event the 
Executive and the Company cannot agree on an arbitrator, the 
Administrator of JAMS/Endispute will appoint an arbitrator.  Neither 
the Executive nor the Company nor the arbitrator shall disclose the 
existence, content, or results of any arbitration hereunder without 
the prior written consent of all parties.  Except as provided herein, 
the Federal Arbitration Act shall govern the interpretation, 
enforcement and all proceedings.  The arbitrator shall apply the 
substantive law (and the law of remedies, if applicable) of the state 
of California, or federal law, or both, as applicable and the 
arbitrator is without jurisdiction to apply any different substantive 
law.  The arbitrator shall have the authority to entertain a motion 
to dismiss and/or a motion for summary judgment by any party and 
shall apply the standards governing such motions under the Federal 
Rules of Civil Procedure.  The arbitrator shall render an award and a 
written, reasoned opinion in support thereof.  Judgment upon the 
award may be entered in any court having jurisdiction thereof.  The 
Executive and the Company shall generally each be responsible for 
payment of one-half the amount of the arbitrator's fee; provided, 
however, that the Company shall pay to the Executive all legal fees 
and expenses (including but not limited to fees and expenses in 
connection with any arbitration) incurred by the Executive in 
disputing in good faith any issue arising under this Agreement 
relating to the termination of the Executive's employment in 
connection with a Change in Control or in seeking in good faith to 
obtain or enforce any benefit or right provided by this Agreement on 
account of a Change in Control unless the arbitrator or court 
determines that the Executive had no reasonable basis for such claim. 
(g) Amendment and Termination.  No provision of this Agreement may 
be amended or terminated unless it is agreed to in writing and signed 
by both parties hereto.  Notwithstanding anything contained herein, 
this Agreement shall automatically terminate and be of no further 
force and effect and no benefits shall be payable hereunder in the 
event that the Company sells or otherwise disposes of any part of the 
business or assets of Sempra Energy or a subsidiary of Sempra Energy 
(other than such a sale or disposition which is part of a transaction 
or series of transactions which would result in a Change in Control) 
and as a result of such transaction, the Executive is no longer 
employed by the Company or any of its Affiliates.  
(h) Counterparts.  This Agreement may be executed in several 
counterparts, each of which shall be deemed to be an original but all 
of which together shall constitute one and the same instrument. 
(I) Governing Law.  This Agreement shall be governed by the laws of 
the State of California, without giving effect to conflicts of laws 
principles thereof. 
(j) Nonexclusivity of Rights.  Nothing in this Agreement shall 
prevent or limit the Executive's continuing or future participation 
in any benefit, plan, program, policy or practice provided by the 
Company and for which the Executive may qualify (except with respect 
to any benefit to which the Executive has waived his rights in 
writing), nor shall anything herein limit or otherwise affect such 
rights as the Executive may have under any other contract or 
agreement entered into after the Effective Date with the Company.  
Amounts which are vested benefits or which the Executive is otherwise 
entitled to receive under any benefit, plan, policy, practice or 
program of, or any contract or agreement entered into with, the 
Company shall be payable in accordance with such benefit, plan, 
policy, practice or program or contract or agreement except as 
explicitly modified by this Agreement. 
 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement 
as of the date first written above. 
SEMPRA ENERGY 
By:   ________________________ 
Richard D. Farman 
Chairman & Chief Executive Officer 
EXECUTIVE 
________________________ 
________________________
 
 



 
                                                                  EXHIBIT 12.1 
                               SEMPRA ENERGY
         COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES 
                       AND PREFERRED STOCK DIVIDENDS                       
                           (Dollars in millions)

                                                                           Three Months
                                                                              Ended
                                                                             March 31,
                             1994      1995      1996      1997      1998      1999
                           --------  --------  --------  --------  --------  --------
                                                           
Fixed Charges and Preferred
Stock Dividends: 
 
Interest                   $   237   $   227   $   205   $   209   $   210   $    59
Interest Portion of 
 Annual Rentals                 35        32        28        25        20         5
Preferred dividends
 of subsidiaries (1)            53        50        37        31        18         5
                           --------  --------  --------  --------  --------  --------
Total Fixed Charges 
 and Preferred Stock
 Dividends For Purpose   
 of Ratio                  $   325   $   309   $   270   $   265   $   248   $    69
                           ========  ========  ========  ========  ========  ========

Earnings:

Pretax income from
  continuing operations    $   634   $   665   $   727   $   733   $   432   $   162
Add: 
 Fixed charges 
  (from above)                 325       309       270       265       248        69
 Less: Fixed charges 
  capitalized                    4         6         5         3         3         -
                           --------  --------  --------  --------  --------  --------
    Fixed charges net of
      capitalized charges      321       303       265       262       245        69
                           --------  --------  --------  --------  --------  --------
 Total Earnings for 
  Purpose of Ratio         $   955   $   968   $   992   $   995   $   677   $   231
                           ========  ========  ========  ========  ========  ========
Ratio of Earnings 
 to Combined Fixed Charges
 and Preferred Stock
 Dividends                    2.94      3.13      3.67      3.75      2.73      3.35
                           ========  ========  ========  ========  ========  ========

(1) In computing this ratio, "Preferred dividends of subsidiaries" represents the before-tax 
earnings necessary to pay such dividends, computed at the effective tax rates for the 
applicable periods.