Pricing Supplement No. 016 Filing under Rule 424(b)(2)
Dated March 27, 1997 Registration No. 333-22347
(To Prospectus dated March 18, 1997, supplemented by Prospectus
Supplement dated March 21, 1997)
$300,000,000
NIPSCO CAPITAL MARKETS, INC.
Medium-Term Notes
Due Nine Months or More From Date of Issue
____________________
Entitled to the benefit of a Support Agreement
Providing for the Payment of Principal and Interest by
NIPSCO Industries, Inc.
____________________
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<S> <C>
Principal Amount: $1,000,000 Interest Payment Date(s): March 15, and
September 15
Trade Date: March 26, 1997
Specified Currency: U.S. Dollars
Original Issue Date: April 1, 1997
Selling Agent s Commission: $7,500
Interest Rate: 7.94 %
Net Proceeds to the Company: $992,500
Stated Maturity Date: April 03, 2017
Form : XX Book Entry ___ Certified
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The Medium-Term Note described in this Pricing Supplement is being
sold through Merrill Lynch & Co., as Agent.
Prior to the date of this Pricing Supplement, $128,000,000 Medium-Term
Notes have been sold. Concurrently herewith, the company is also
selling (1) $15,000,000 aggregate principal amount of Medium-Term
Notes with a Stated Maturity Date of April 2, 2007 and bearing an
interest rate of 7.5% at the initial price to the public equal to 100%
of par, less a fee to Morgan Stanley & Co. Incorporated, as Agent,
equal to 0.625%; (2) $10,000,000 aggregate principal amount of
Medium-Term Notes with a Stated Maturity Date of April 2, 2007 and
bearing an interest rate of 7.49% at the initial price to the public
equal to 100% of par, less a fee to Morgan Stanley & Co.
Incorporated, as Agent, equal to 0.625%; (3) $30,000,000 aggregate
principal amount of Medium-Term Notes with a Stated maturity Date of
April 2, 2004 and bearing an interest rate of 7.4% at the initial
price to the public equal to 100% of par, less a fee to Merrill Lynch
& Co., as Agent, equal to 0.6%; and (4) $2,000,000 aggregate principal
amount of Medium-Term Notes with a Stated Maturity Date of April 3,
2017 and bearing an interest rate of 7.93% at the initial price to the
public equal to 100% of par, less a fee to Merrill Lynch & Co., as
Agent, equal to 0.75%.
Goldman, Sachs & Co.
Merrill Lynch & Co.
Morgan Stanley & Co.<PAGE>
Incorporated<PAGE>
