SCHEDULE 14A INFORMATION

          Proxy Statement Pursuant to Section 14(a) of the Securities
                     Exchange Act of 1934 (Amendment No.  )

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                                                 by Rule 14a-6(e)(2))
( )  Definitive Proxy Statement
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( )  Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12


                            DOMINION RESOURCES, INC.
                (Name of Registrant as Specified in its Charter)


      (Name of Person(s) Filing Proxy Statement, if other than Registrant)

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     4)  Date Filed:


<PAGE>



[DOMINION RESOURCES LOGO]

1999 Proxy Statement
Dominion Resources, Inc.



Vote Your Proxy

 -> By Internet
 -> By Telephone
 -> By Mail




Dominion Resources, Inc.
P.O. Box 26532
Richmond, Virginia 23261



<PAGE>


1999 Proxy Statement Contents


Notice of Annual Meeting           2

The Proxy Process                  3

The Board                          5

Share Ownership Table             11

Organization, Compensation &      12
Nominating Committee Report

Executive Compensation            16

Amendments to Dominion            23
Resources Articles of
Incorporation 

Incentive Compensation 
Plan                              24

Other Information                 27



<PAGE>


Notice of Annual Meeting


Dominion Resources, Inc.
P.O. Box 26532
Richmond, Virginia 23261

                                   [DOMINION RESOURCES LOGO]


March 17, 1999


Dear Shareholder:

On Friday, April 16, 1999, Dominion Resources, Inc. will hold its Annual
Meeting of Shareholders in the auditorium of Roanoke Island Festival Park, One
Festival Park, Manteo, North Carolina. The meeting will begin at 9:30 a.m.
Eastern Daylight Time.
  Only  shareholders  who owned stock at the close of  business on February  19,
1999 may vote at this meeting or any  adjournments  that may take place.  At the
meeting we propose to:
    o Elect four directors;
    o Amend the Articles of Incorporation to eliminate the classification
      of the Board of Directors and to increase the maximum number of Directors
      to 17;
    o Amend the Dominion Resources, Inc. Incentive Compensation Plan;
      and
    o Attend to other business properly presented at the meeting.
  We recently mailed a copy of our 1998 Annual Report to all shareholders. The
approximate  date of mailing this proxy  statement and card is March 17, 1999. I
hope you will be able to attend the meeting, but even if you cannot, please vote
your proxy as soon as you can.

By order of the Board of Directors,



Patricia A. Wilkerson
Corporate Secretary


2


<PAGE>




The Proxy Process

Your Board of Directors is soliciting  this proxy for the 1999 Annual Meeting of
Shareholders  and encourages  you to vote in favor of all the Director  nominees
and proposals outlined in this proxy.


Record Date

All shareholders who owned stock at the close of business  February 19, 1999 are
entitled  to vote at the  Annual  Meeting.  There  were  193,325,666  shares  of
Dominion Resources, Inc. common stock outstanding on that date.

Voting

Methods. You may vote in person at the Annual Meeting or by proxy. This year
you have three ways to vote by proxy:
    1. Connect to the Internet at
       www.votefast.com;*
    2. Call 1-800-250-9081;* or
    3. Complete the proxy card and mail it back to us. 
       Complete instructions for voting your proxy can 
       be found on your proxy card included with this 
       proxy statement.


Rights.  Each of your shares will be counted as one vote. If you vote and change
your mind on any issue,  you may revoke  your proxy at any time before the close
of voting at the Annual Meeting. There are four ways to revoke your proxy:
    1. Connect to the website listed in the previous column*;
    2. Call the 800 number listed in the
       previous column*;
    3. Write to our Corporate Secretary; or
    4. Vote your shares at the Annual Meeting.

  A majority of the shares outstanding on February 19, 1999 constitutes a quorum
for this  meeting.  Abstentions  and shares held by a broker or nominee  (Broker
Shares) that are voted on any matter are included in determining a quorum.
  The four nominees for director  receiving the most votes will be elected.
  The amendments to our Articles of Incorporation will be adopted if at least
two-thirds of the shares entitled to vote approve the amendments. The
amendments to the Dominion Resources, Inc. Incentive Compensation Plan
will be approved if the number of votes in favor of the Plan exceeds the
number against it. Broker shares not voted and abstentions have
no effect on the final vote counted.



*  Not for Beneficial Owners
                                                                               3

<PAGE>

Registered Shareholders and Dominion Direct Participants. Your proxy card shows
the number of full and fractional shares you own. If you are a participant in
our Dominion Direct Investment stock purchase plan, the number includes shares
we hold in your Dominion Direct Investment account. All shares will be voted
according to your instructions if you properly vote your proxy by one of the
methods listed on p. 3. If you sign your proxy and do not make a selection, it
will be voted as recommended by the Board of Directors. If you are a Dominion
Direct Investment participant and do not vote your proxy, we will vote all
shares held in that account according to the Board's recommendations. No vote
will be recorded for registered shares that are not properly voted.

Employee  Savings  Plan  Participants.  You will  receive a request  for  Voting
Instructions from Mellon Bank, N.A., the Savings Plan trustee. The share amounts
listed on that form include the full and fractional  shares in your Savings Plan
account. You may instruct Mellon by:
    1.Connecting to www.votefast.com;
    2.Calling 1-800-250-9081; or
    3.Returning  your  Voting  Instructions  in the  enclosed  envelope  (not to
      Dominion Resources).
  Complete  instructions  can be found on the Voting  Instruction  Card included
with the proxy statement.
  Whichever  method  you  choose,  Mellon  Bank  will  vote  according  to  your
instructions and will keep your vote confidential. If you do not vote
your Savings Plan shares,  Mellon Bank generally will vote your shares according
to the Board's recommendations.

Beneficial  Owners (Broker Shares).  If your shares are held in street name with
your broker, please follow the instructions found on the Voting Instruction Card
enclosed with this proxy statement.

Solicitation and Tabulation

We will pay for soliciting proxies from our shareholders, and some of our
employees may telephone shareholders after the initial mail solicitation. In
addition, we may reimburse brokerage firms and other custodians, nominees and
fiduciaries for their reasonable expenses in sending proxy materials to the
beneficial owners of stock. We have retained Corporate Election Services, Inc.
to tabulate the proxies and to assist with the Annual Meeting. We have also
retained Georgeson & Co., Inc., a proxy solicitation firm, to assist in the
solicitation of proxies for a fee of $14,000 and reimbursement of expenses.

4


<PAGE>


The Board

Item One. Election of Directors

If Item Two on p. 23 is approved by the shareholders, each director's term of
office will end at the next Annual Meeting of Shareholders in April 2000. If
Item Two is not approved, the nominees will, if elected, serve three-year terms
ending in 2002 and the directors whose terms have not expired will continue to
serve until the expiration of their terms. Four directors will be elected at the
1999 Annual Meeting. The nominees are: John W. Harris, Kenneth A. Randall,
Judith B. Warrick and David A. Wollard. Mr. Randall and Ms. Warrick are
incumbent directors, while Mr. Harris and Mr. Wollard are new nominees.
  Information about each nominee and the other directors is listed below. If the
year listed for a director is earlier than 1983, when Dominion Resources became
the parent corporation of Virginia Electric and Power Company, that year
represents the year first elected as a director of Virginia Power.
  Your proxy will be voted to elect the nominees  unless you tell us  otherwise.
If any  nominee  is not  available  to  serve  (for  reasons  such as  death  or
disability),  your proxy will be voted for a substitute  nominee if the Board of
Directors  nominates one. 

Nominees for Election (Terms Expiring in 2002) 


<TABLE>
<CAPTION>


Nominee Directors                                                                      Year First Elected        Year First Elected
                                                                                         a Director to an           a Director of 
                                                                                        Affiliate Company        Dominion Resources
                                                                                       

                                                         
                                                         
<S>                                                              <C>                          <C>


JOHN W. HARRIS, 51, President, Lincoln Harris,
LLC, a real estate consulting firm, Charlotte, North
Carolina. He is a Director of Piedmont Natural Gas 
Company, Inc. and US  Airways Group, Inc.                          [PHOTO]                   1994






KENNETH A. RANDALL, 71, Corporate director for
various companies, Williamsburg, Virginia. 
He is a Director of Virginia Power, Oppenheimer 
Funds, Inc., Kemper Insurance Companies and Prime 
Retail, Inc.                                                       [PHOTO]                                                 1971





JUDITH B. WARRICK, 50, Senior Advisor, as of September 1, 
1995, Morgan Stanley & Co., Inc., an investment banking 
firm, New York, New York (prior to September 1,
1995, Advisor). She is a Director of Virginia Power.               [PHOTO]                   1989                          1994
                                                                   





DAVID A.  WOLLARD,  61,  Chairman  of the Board of Exempla  
Healthcare,  Denver, Colorado (prior to January 1, 1996, 
President of Bank One Colorado, N.A.).                              [PHOTO]                 1994





The Board of Directors recommends that you vote FOR these Nominees.


                                                                              5

<PAGE>

Incumbent Directors




<CAPTION>


Directors with Terms Expiring in 2001                                           Year First Elected              Year First Elected
                                                                                  a Director to an                   a Director of
                                                                                 Affiliate Company              Dominion Resources



JOHN B. ADAMS, JR., 54, President and Chief Executive 
Officer of Bowman Companies, a manufacturer and
bottler of alcohol beverages, Fredericksburg, Virginia.
He is a Director of Pluma, Inc. and Virginia Power.          [PHOTO]                    1987                         1994





BENJAMIN J. LAMBERT, III, 62, Optometrist, Richmond, 
Virginia. He is a Director of Consolidated Bank and 
Trust Company, Virginia Power and Student Loan Marketing 
Association (Sallie Mae).                                    [PHOTO]                     1992                         1994





RICHARD L. LEATHERWOOD, 59, Retired, Baltimore, Maryland. 
Former President and Chief Executive Officer, CSX Equipment,
 an operating unit of CSX Transportation, Inc. He is a 
Director of Virginia Power and CACI International Inc.      [PHOTO]                                                  1994





FRANK S. ROYAL, M.D., 59, Physician, Richmond, Virginia.
He is a Director of Columbia/HCA Healthcare Corporation, 
SunTrust Banks, Inc., Chesapeake Corporation, CSX 
Corporation and Virginia Power.                             [PHOTO]                                                 1994



6



<PAGE>



Incumbent Directors







Directors with Terms Expiring in 2000                                           Year First Elected              Year First Elected
                                                                                  a Director to an                   a Director of
                                                                                 Affiliate Company              Dominion Resources

JOHN B. BERNHARDT, 69, Managing Director, Bernhardt/
Gibson Financial Opportunities, financial
services, Newport News, Virginia. He is a Director of
Virginia Power and Resource Bank Shares.                          [PHOTO]                      1981



THOS. E. CAPPS, 63, Chairman, President and Chief   
Executive Officer of Dominion Resources (from August 
15, 1994 to September 1, 1995, Chairman and
Chief Executive Officer; prior to August 15, 
1994, Chairman, President and
Chief Executive Officer). He is Chairman and a 
Director of Virginia Power and a Director of 
Bassett Furniture Industries, Inc.                                [PHOTO]                      1986





S. DALLAS SIMMONS, 59, President of Virginia Union
University, Richmond, Virginia. He is a Director of
Virginia Power.                                                   [PHOTO]                     1992

ROBERT H. SPILMAN, 71, President, Spilman   
Properties,  Inc., Bassett,  Virginia 
(before that, Chairman and Chief Executive Officer of 
Bassett Furniture Industries, Inc., until his retirement 
in 1997). He is  a  Director  of   Jefferson-Pilot   
Corporation,   The   Pittston   Company, International 
Home Furnishing Center and Virginia Power.                          [PHOTO]                      1994
</TABLE>




                                                                           7

<PAGE>



Committees. 


In 1998, committee memberships were changed. Each director now serves on just
one com mittee in order to provide greater focus to his or her committee's work.


Meeting Attendance

The Board met 10 times in 1998.  Each Board member  attended at least 91% of the
total number of meetings of the Board and committees on which he or she served.

<TABLE>
<CAPTION>

Committee                                    Members                                     Description
<S> <C>

Audit                              Harvey L. Lindsay, Jr.                  These three non-employee directors consult with     
                                   William T. Roos                         the independent and internal auditors regarding
                                   S. Dallas Simmons, Chairman             the examination of Dominion Resources' and its      
                                                                           subsidiaries' (collec tively, the Company)          
                                                                           financial statements and the adequacy of internal   
                                                                           controls. The Committee reports to the Board of     
                                                                           Directors on these matters and recommends the       
                                                                           independent auditors to be designated for the next  
                                                                           year. In 1998, this committee met two times.        
                                                                           

Finance                            John B. Adams, Jr., Chairman            These three non-employee directors review the       
                                   Benjamin J. Lambert, III                Company's financing strategies and consider         
                                   Judith B. Warrick                       dividend policy. In 1998, this committee met three  
                                                                           times. 


Organization, Compensation         John B. Bernhardt                       These five non-employee directors work closely         
and Nominating                     Richard L. Leatherwood                  with independent consultants and management to         
                                   Kenneth A. Randall, Chairman            review the Company's organizational and
                                   Frank S. Royal                          compensation structure. They make recommendations      
                                   Robert H. Spilman                       on these matters to the Board of Directors and         
                                                                           administer certain compensation plans. They also       
                                                                           review the qualifications of director candidates       
                                                                           suggested by Board members, management,                
                                                                           shareholders and others, and recommend nominees        
                                                                           for election as Directors. In 1998, this committee     
                                                                           met nine times.                                        
                                                                                                                                  
</TABLE>

                 

8                              

<PAGE>


Compensation and Other Programs

Fees.  During  1998,  non-employee  directors  were paid an annual  retainer  of
$19,000 in cash plus $19,000 in stock. They also received $900 in cash per Board
or committee meeting attended.

Deferred Cash  Compensation  Plan.  Directors may elect to defer their cash fees
under this plan until they reach  retirement  or a specified  age.  The deferred
fees are credited to either an interest bearing account or a Dominion  Resources
common stock equivalent account.  Interest or dividend  equivalents accrue until
distributions  are made. A director  will be paid in cash or stock  according to
the election made.

Stock  Compensation  Plan. The stock portion of the directors'  retainer is paid
under this plan.  Directors have the option to defer receipt of the stock.  If a
director  elects this option,  the shares are held in trust until the director's
retirement  and the  dividends  on those  shares are  reinvested.  However,  the
director retains all voting and other rights as a shareholder.



Stock  Accumulation  Plan.  Upon election to the Board, a non-employee  director
receives a one-time  award under this plan.  The award is in Stock Units,  which
are equivalent in value to Dominion  Resources common stock. The award amount is
determined  by  multiplying  the  director's  annual  cash  retainer by 17, then
dividing the result by the average price of Dominion  Resources  common stock on
the last trading days of the three months before the director's  election to the
Board.  The Stock Units awarded to a director are credited to a book account.  A
separate  account is  credited  with  additional  Stock  Units equal in value to
dividends on all Stock Units held in the  director's  account.  A director  must
have 17  years  of  service  to  receive  all of the  Stock  Units  awarded  and
accumulated under this plan. Reduced  distributions may be made where a director
has at least 10 years of service.

Charitable Contribution Program. As part of its overall program of charitable
giving, the Company offers the directors participation in a Directors'
Charitable Contribution Program. The Program is funded by life insurance
policies purchased by the Company on the directors. The directors derive no
financial or tax benefits from the Program, because all insurance proceeds and
charitable tax deductions accrue solely to the Company.  However, upon the death
of a director,  the Company will donate an aggregate of $50,000 per year for ten
years to one or more  qualifying  charitable  organizations  recommended by that
director.

Matching  Gifts  Program.  Directors may give up to $1,000 per year to 501(c)(3)
organizations  of their choice and the Company  will match their  donations on a
1-to-1 basis. If their donation is to an  organization  for which they volunteer
more than 50 hours of work during a year, the Company will match the donation on
a 2-to-1 basis.

                                                                              9

<PAGE>
Director Nominations

Under our Bylaws, if you wish to nominate a director at a shareholders'  meeting
you must be a shareholder and deliver written notice to our Corporate  Secretary
at least 60 days before the meeting.  If the meeting date has not been  publicly
announced 70 days before the meeting, then notice can be given 10 days following
the public announcement. Any notice must include the following information:

     1.   your name and address;
     2.   each nominee's name and address;
     3.   a statement that you are entitled to vote at the meeting and intend to
          appear in person or by proxy to nominate your nominees;
     4.   a description of all arrangements or undertakings between you and each
          nominee and any other person concerning the nomination;
     5.   other  information about the nominee that would be included in a proxy
          statement soliciting proxies for the election of directors; and
     6.   the consent of the nominee to serve as a director.


10

<PAGE>

Share Ownership Table

The table below shows the amount of Dominion Resources common stock beneficially
owned as of February 19, 1999 by each director and the executive  officers named
in the  compensation  table  on p.  16.  Also  included  in this  table is stock
ownership for all directors and executive officers as a group.

Name                                         Stock Ownership    Director Plan
                                                                 Accounts (1)
John B. Adams, Jr.                                 3,997              9,647
John B. Bernhardt                                  2,000*             9,647
Thos. E. Capps                                    65,231 (2)            --
John W. Harris                                     5,479              9,647
Benjamin J. Lambert, III                             590*            11,086
Richard L. Leatherwood*                            1,500             19,886
Harvey L. Lindsay, Jr.                               879              9,647
Kenneth A. Randall                                 3,713              9,647
William T. Roos*                                  11,262              9,647
Frank S. Royal                                       500*            11,067
S. Dallas Simmons                                  3,332             11,983
Robert H. Spilman                                  1,666              9,647
Judith B. Warrick                                  1,500*            15,460
David A. Wollard                                   1,315              9,647
Norman B. Askew                                    3,425 (2)             --
Thomas N. Chewning                                11,924 (2)             --
Thomas F. Farrell, II                             17,113 (2)             --
David L. Heavenridge                              14,218 (2)  
All directors and executive officers as a 
  group (22 persons) (3)                         190,461 (2)(4)


- -------------------------------------------------------------------------------
*Includes 500 shares held in trust under Dominion Resources Stock Compensation
Plan as described on p. 9.

(1) Amounts  in  this  column  represent  share  equivalents  accumulated  under
    directors'  plans  described  on page 9.  Balances  of 9,647  shares are the
    amounts accumulated under the Stock Accumulation Plan. Because of the plan's
    vesting  provisions,  these amounts will not necessarily be distributed to a
    director.  Any balance in excess of 9,647 is an amount of share  equivalents
    accumulated--at   the   director's   election--under   the   Deferred   Cash
    Compensation plan and will be distributed in actual shares to the director.
(2) Amounts include restricted stock as follows:
    Mr. Capps, 33,153 shares; Mr. Askew, 2,057 shares; Mr. Chewning, 5,281
    shares; Mr. Farrell, 14,467 shares; Mr. Heavenridge, 5,281 shares; and all
    directors and executive officers as a group, 84,716 shares.
(3) All current  directors and executive  officers as a group own less than one
    percent of the number of shares outstanding as of February 19, 1999.
(4) Beneficial ownership is disclaimed for a total of 399 shares.

                                                                              11

<PAGE>

Organization, Compensation & Nominating Committee Report
Compensation Philosophy

Our Committee and management believe it is vitally important to align our
officers' financial success with the financial success of our shareholders. We
have renewed our focus on stock ownership as a key measure of such alignment. We
work  closely  with  management  in  our  oversight  and  administration  of the
Company's organization and compensation. We also recognize that, as our industry
redefines  itself,  our programs must attract,  retain and motivate high caliber
employees.
  Guided by this  necessity,  we have approved pay programs that link  executive
compensation to company performance.  Each year, we put a significant portion of
our   executives'   pay  at  risk.   This  creates  annual   opportunities   for
executives--through   individual  business  unit  performance  and  consolidated
performance--to  increase  significantly their total compensation,  both in cash
and in stock.
  Our  work  includes  review  of  the  CEO's  total  compensation  package  and
performance. Mr. Capps is not present when we discuss his compensation.

1998 Compensation

Our executive compensation program consists of three basic components:
    o Base Salary
    o Annual Incentives
    o Long-Term Incentives

Base Salary

Our Committee  positions  our  executive  base salaries to be at the median base
salaries of similar positions at a peer group of diversified utilities and other
businesses  with  which  we  compete  on a  national  basis.  We  also  consider
individual performance and competitive pressures.

Executive  Officers.  We selected an independent  compensation  consultant,  who
analyzed our  executives'  salaries and compared them to our  competitive  labor
market. Our Committee also reviewed individual executive  performance.  Based on
our review and the  consultant's  report,  we  approved  base  salary  increases
effective January 1, 1998.

Chief Executive Officer. The independent  compensation  consultant also reviewed
with  us  competitive  compensation  information  for  CEOs in a peer  group  of
diversified  electric  utility  companies.   After  thoroughly  evaluating  this
material,  considering our compensation  philosophy,  and recognizing Mr. Capps'
increased challenges as a CEO in a rapidly changing industry, we approved a base
salary of $780,000 for Mr. Capps, effective January 1, 1998.

12

<PAGE>

Annual Incentives

Under the annual  incentive  program,  if goals are fully met or  exceeded,  the
executive's  total  cash  compensation  for the year may be more than the median
total cash  compensation  for similar  positions at  companies in our  executive
labor market.
  Under  this  program  our  Committee  establishes  "target  awards"  for  each
executive  officer.  These target  awards are  expressed as a percentage  of the
individual  executive's base salary (for example, 30% x base salary). The target
award is the amount of cash that will be paid,  at  year-end,  if the  executive
achieves 100% of the goals established at the beginning of the year.
  We also  establish a  "threshold"--or  minimum  acceptable  level of financial
performance. If this threshold is not met, no employee receives an annual bonus.
Actual bonuses,  if any, are based on a  pre-established  formula and may exceed
100% of the target award.

Executive Officers. For Dominion Resources' executive officers,  1998 net income
was used as the  performance  measure  under the  annual  incentive  plan.  Each
executive's  goals were weighted  heavily toward the net income  contribution of
the  business  unit  for  which  they  were  responsible,  but also  included  a
consolidated  net income  goal.  Awards  under  this plan for Mr.  Askew and Mr.
Farrell were  pro-rated  based on their relative  responsibilities  for Dominion
Resources and Virginia Power.
  Our Committee  established and approved the goals at the beginning of 1998. At
year-end,  we compared actual  financial  performance  with the consolidated and
business  unit net  income  goals.  For  1998,  these  goals  were  achieved  or
surpassed.  Net income for the  business  units is  reported  in the  Management
Discussion  and  Analysis of  Operations  section of our 1998  Annual  Report to
Shareholders.

   Mr. Askew and Mr. Farrell also participated in the Virginia Power annual
incentive plan during 1998 based on their relative responsibilities for that
business unit. Under the Virginia Power plan, they received a pro-rated award
based on individual goal achievement. Mr. Askew's and Mr. Farrell's goals were
weighted 90% Virginia Power financial goals (operating profit and net cash flow)
and 10% stewardship goals (safety, environmental impact and affirmative action).

  Annual bonuses paid to the named executives are detailed in the Summary
Compensation Table on p. 16.

Chief Executive Officer. At the beginning of 1998, we approved net income
goals for Mr. Capps. Eighty percent was weighted to the net income
contribution of the consolidated business units (excluding Virginia Power) and
20% to consolidated Dominion Resources net income. Because our net income
goals for 1998 were surpassed, we approved an annual cash bonus of $594,344
for Mr. Capps.

                                                                              13

<PAGE>

Long-Term Incentives

We believe the long-term  incentive  programs we approve play a critical part in
our  compensation  practices and philosophy.  As a result,  at least half of the
long-term incentive component is paid in company stock--a long-term  investment.
We believe  this form of payout  underscores  commitment  to the  company  while
rewarding performance.
  Our Committee  establishes and approves  long-term goals at the beginning of a
performance cycle (typically three years). At the end of the performance  cycle,
actual results are compared with the established goals.

Executive Officers. Dominion Resources' goals were established in 1996 for the
1996-1998 performance cycle. The performance measure used for the executive
officers was growth in the combined net worth of Dominion Capital and Dominion
Energy. Based on 1998 year-end net worth, which exceeded the performance goal,
we awarded the executives shares of restricted stock and cash (see the LTIP
Payout column of the Summary Compensation Table on p. 16). The shares awarded
are restricted for two years. They cannot be sold and will be forfeited if the
executive terminates employment during the two-year restricted period.

  During 1998, the Committee approved awards of restricted stock and related tax
payments  to  certain  executive  officers  to  recognize  their   extraordinary
achievement for the Company's  shareholders resulting from the investment in and
the sale of East Midlands Electricity,  plc. (See the Summary Compensation Table
on p. 16.) These  shares are  restricted  for one year and cannot be sold during
that period.
  Mr. Askew and Mr. Farrell also participated, on a pro-rated basis, in
Virginia Power's long-term program for the 1996-1998 performance cycle. The
performance measure used was cumulative Economic Value Added for the same
three-year period. Based on their accomplishment level, Mr. Askew and Mr.
Farrell received their award in the form of 50% cash and 50% restricted stock.
The shares are restricted for two years. They cannot be sold and will be
forfeited if the executive terminates employment during the two-year
restricted period (see LTIP Payout column of the Summary Compensation Table on
p. 16.)

Chief Executive Officer. Goals for Mr. Capps were established in 1996 for the
1996-1998 performance cycle. We determined that his entire award, if any,
should be paid in Dominion Resources common stock. The goals were:

- -------------------------------------------------------------------------------
Mr. Capps' Goals                             Weight
- -------------------------------------------------------------------------------
Total return to shareholders superior         50%
to the S&P Utility Index
- -------------------------------------------------------------------------------
Specified  annual  growth in  
 earnings  per share                          25% 
- -------------------------------------------------------------------------------
Cost  control  of  utility
operating costs                               25%

  Subject to achievement  of these goals,  we granted Mr. Capps 14,602 shares of
restricted  stock  at  the  beginning  of  the  performance  cycle.  During  the
performance cycle, Mr. Capps' dividends were re-invested to purchase  additional
shares of stock. Because the first goal was not met, Mr. Capps forfeited all but
4,868 of the 14,602  originally  granted,  and  retained  only 33% of the shares
purchased through dividend reinvestment during the performance cycle.


14

<PAGE>


  The Committee approved a supplemental long-term incentive program for the
CEO for the period 1996-1998 based on findings by the independent compensation
consultant that the CEO's long-term target award level was substantially below
the market. Mr. Capps' long-term target award level was increased and this
change was made effective with the 1996-1998 performance cycle. Consolidated
net income goals were approved by the Committee. At the end of 1998, Mr.
Capps' performance under this plan was evaluated. Based on his performance, an
award was made in cash and in shares of company stock as reported in the LTIP
Payout column of  the Summary Compensation Table on p. 16.

  During 1998, the Committee recognized Mr. Capps' extraordinary performance and
leadership in negotiating the sale of East Midlands  Electricity and awarded Mr.
Capps  shares of  restricted  stock and related tax  payments as reported in the
Summary Compensation Table on p. 16. These shares are restricted for one year.

Deductibility of Compensation

Under Section 162(m) of the Internal Revenue Code, Dominion Resources may not
deduct certain forms of compensation in excess of $1 million paid to 
our CEO  or any of the four other most highly compensated
executive officers. However, certain performance-based compensation is 
specifically exempt from the deduction limit.
                                                                           
  It is our intent to provide competitive executive compensation while
maximizing  the  Company's  tax  deduction.  However,  we  reserve  the right to
approve,  and in some cases have  approved,  non-deductible  compensation  if we
believe it is in the Company's best interest.

  Kenneth A. Randall, Chairman
  John B. Bernhardt
  Frank S. Royal
  Richard L. Leatherwood
  Robert H. Spilman

                                                                              15

<PAGE>

Executive Compensation



The table below shows the total salary and awarded to or earned by the CEO and
the four other most highly compensated executive officers (as of December 31,
1998).



Summary Compensation Table

<TABLE>
<CAPTION>

                                                                                     Long-Term Compensation
                                                                                     -----------------------
Name and
Principal Position                      Annual Compensation                          Awards           Payouts
                                                                                     ------           -------
                                                                         Other
                                                                         Annual      Restricted        LTIP        All Other
                                                                        Compen-         Stock         Payouts      Compen-
                                     Year       Salary(1)       Bonus   sation(2)       Awards(3)       (4)        sation(5)
                                     ----       ---------       -----   -------         ------          ---        -------        
<S> <C>
Thos. E. Capps
Chairman, President & CEO
                                      1998     $795,000       $594,344  $848,902       $995,312      $639,126      $4,800
                                      1997      775,172        491,015     7,708              0       129,675       4,800
                                      1996      668,075        345,538         0        286,875       122,348       4,500

Norman B. Askew
Executive Vice President
(President & CEO--
Virginia Power)
                                      1998      500,000        375,089         0              0       183,266           0
                                      1997      393,006        279,175    17,782              0       124,730     206,482

Thomas F. Farrell, II
Senior Vice President
(Executive Vice Pres-
ident--Virginia Power)                1998      314,471        239,289   419,098        497,656       178,644       4,800
                                      1997      268,144        154,956         0              0        67,598       4,800
                                      1996      180,000         87,343         0              0        24,790       4,800
David L. Heavenridge
Executive Vice President
(President & CEO--Dominion 
 Capital, Inc.)
                                      1998      321,058        224,274   105,554        124,414       196,742       4,800
                                      1997      322,199        167,456       571              0       105,939     243,770
                                      1996      250,338        118,762         0              0        61,237       4,500
Thomas N. Chewning
Executive Vice President
(President & CEO--Dominion Energy, 
   Inc.)                              1998      318,786        224,274   104,868         124,414      196,742       4,800
                                      1997      303,730        167,706       418               0      105,939     247,112
                                      1996      232,838        118,762         0               0       61,237       4,925
</TABLE>


Note: For at least the past three years, Dominion Resources has not issued
stock options.

Footnotes to the Summary Compensation Table


16


<PAGE>

1. Salary. Amounts shown may include vacation sold back to the Company.


2. Other Annual Compensation. None of the named executives received perquisites
or other personal benefits in excess of $50,000 or 10% of their total cash
compensation. The amounts listed in this column for 1998 are amounts reimbursed
during the fiscal year for the payment of taxes.

3. Restricted Stock. The amount shown for 1998 is the value of restricted stock
awarded as follows: Mr. Capps, 25,000 shares; Mr. Heavenridge, 3,125 shares; Mr.
Chewning, 3,125 shares; and Mr. Farrell, 12,500 shares. These shares cannot be
sold for one year. Dividends are paid on restricted stock. The number and value
of each executive's restricted stock holdings at year-end, based on a December
31, 1998 closing price of $46.75, were as follows:



- ----------------------------------------------------
Officer                  Number           Value
                     of Restricted
                      Stock Shares
- ----------------------------------------------------
 Thos. E. Capps           39,602     $1,851,394
 Norman B. Askew           1,290         60,308
 Thomas F. Farrell, II    13,323        622,850
 David L. Heavenridge      4,415        206,401
 Thomas N. Chewning        4,415        206,401
- -----------------------------------------------------

4. LTIP Payouts. Amounts in this column represent payouts under two long-term
plans (Dominion Resources and Virginia Power) for performance cycles that ended
in 1998, as described on pages 14 and 15. The chart below details these amounts
for each executive.


- -------------------------------------------------------------------------------
   Officer                   Restricted             Cash Award
                            Stock Award
- -------------------------------------------------------------------------------
   Thos. E. Capps             9,868                $200,000
   Norman B. Askew            2,057                 177,040
   Thomas F. Farrell, II      1,967                  91,958
   David L. Heavenridge       2,156                 100,800
   Thomas N. Chewning         2,156                 100,800
- -------------------------------------------------------------------------------

5. All Other Compensation. The amounts listed for 1998 are company matching
contributions on Employee Savings Plan accounts for the named executives.

                                                                              17

<PAGE>

Long-Term Incentive Plans -- Awards for Last Fiscal Year

<TABLE>
<CAPTION>

Officer
                              Number of Shares,          Performance        Estimated Future Payouts Under
                                Units or Other              or Other         Non-Stock Price-Based Plans  
                                     Rights (#)         Period Until        
                                                          Maturation         Threshold           Target   
                                                           or Payout          ($ or #)         ($ or #)   
<S> <C>
Thos. E. Capps                       $772,200               3 years          $386,100          $772,200 
Norman B. Askew                       390,800               3 years           195,400           390,800 
Thomas F. Farrell, II                 242,200               3 years           121,100           242,200 
David L. Heavenridge                  246,200               3 years           123,100           246,200 
Thomas N. Chewning                    246,200               3 years           123,100           246,200 
</TABLE>

                                                                             
Footnote to LTIP Table

The above table reflects the value of awards that will be made to our executives
for the  1998-2000  performance  cycle of the  long-term  incentive  programs if
specified  goals are achieved.  The  established  Dominion  Resources'  goal for
executives is cumulative net income over the three-year  performance period. The
established Virginia Power goals are operating profit and cash flow. These goals
are weighted as follows:

- -------------------------------------------------------------------------------
Officer            Consolidated   Dominion   Dominion   Dominion   Virginia
                                 Companies    Capital     Energy      Power
- -------------------------------------------------------------------------------
Thos. E. Capps              50%        50%
Norman B. Askew             50%                                         50%
Thomas F. Farrell, II       50%                                         50%
David L. Heavenridge        50%                   50%
Thomas N. Chewning          50%                              50%
- -------------------------------------------------------------------------------

18


<PAGE>

At the  end of the  1998-2000  performance  cycle,  actual  performance  will be
measured  against these  pre-established  goals. At 100% goal  achievement,  the
target value will be paid 50% cash and 50% in shares of  restricted  stock.  The
stock will be  restricted  for two years.  During this time the shares cannot be
sold and will be forfeited by the executive if he terminates employment.

No awards will be paid if the threshold level of performance, which was
established at the beginning of the performance cycle, is not reached. Above the
threshold level, performance will be measured and awards will be paid based on
the percent of goal achievement, and may exceed 100%.

Performance Graph

The table below shows the five year cumulative total return  comparison  between
Dominion Resources, the S&P 500 Index and the S&P Utility Index.



<TABLE>
<CAPTION>

                                        1993           1994           1995        1996      1997         1998
                                        ----           ----           ----        ----      ----         ----
<S> <C>
Dominion Resources                     $100.00        $84.68         $103.84     $103.63   $122.70      $143.31
S&P 500                                 100.00        101.32          139.40      171.40    228.59       293.91
S&P Utilities                           100.00         92.06          130.74      134.83    168.07       192.89
</TABLE>





Retirement Plans

The table  below shows the  estimated  annual  straight  life  benefit  that the
Company would pay to an employee at normal retirement (age 65) under the benefit
formula of the Retirement Plan.

<TABLE>
<CAPTION>

- ---------------------------------------------------------------------------------------------------------
Final Average Earnings      Estimated Annual Benefits Payable Upon Retirement--Credited Years of Service
                        15              20             25             30
- ---------------------------------------------------------------------------------------------------------
<S> <C>
$300,000              $86,407        $115,210       $144,012       $172,814
350,000               101,632         135,510        169,387        203,264
400,000               116,857         155,810        194,762        233,714
450,000               132,082         176,110        220,137        264,164
500,000               147,307         196,410        245,512        294,614
550,000               162,532         216,710        270,887        325,064
600,000               177,757         237,010        296,262        355,514
650,000               192,982         257,310        321,637        385,964
750,000               223,432         297,910        372,387        446,864
800,000               238,657         318,210        397,762        477,314
- -------------------------------------------------------------------------------
</TABLE>



                                                                           19

<PAGE>


Dominion Resources Retirement Plan. Benefits under the Retirement Plan are
based on:
    o average base salary over a five year
      period when base pay is highest;
    o years of credited service;
    o age at retirement; and
    o the offset of Social Security benefits.

In addition, certain officers, if they reach a specified age while still
employed, will be credited with additional years of service. For the executives
named in the Summary Compensation Table on p. 16, credited years of service at
age 60 would be 30 years. Other retirement agreements and arrangements for the
named executives are described on below.

Dominion Resources Benefit  Restoration Plan. The Retirement Plan pays a benefit
that is calculated on average base salary over a five-year period. In some years
our  executives'  base salaries are set below the  competitive  market median in
order to more  closely  link  annual  pay to  company  performance  through  the
incentive  programs.  Under this Restoration  Plan, we calculate a "market-based
adjustment"  to base salary in those years when base salary was below the market
median. The difference between the benefit calculated on the market-based salary
and the benefit paid by the Retirement  Plan is paid to the executive  under the
Restoration Plan.

  In 1998, a  market-based  adjustment  to Dominion  Resources'  executive  base
salaries was not  necessary.  Virginia  Power's  executives  (Mr.  Askew and Mr.
Farrell on a pro-rated  basis)  received an 11% adjustment for  calculating  the
Retirement benefit under the Restoration Plan.

Also, the Internal Revenue Code imposes certain limits related to Retirement
Plan benefits. Any resulting reductions in an executive's Retirement Plan
benefit will be compensated for under the Restoration Plan.

East Midlands Electricity Pension Plan. Mr. Askew participates in the pension
plans of Dominion Resources' former subsidiary, East Midlands Electricity,
plc. East Midlands was sold in July 1998. Benefits under this retirement plan
are based on:

    o Highest salary in final 5 years of service
    o Years of pensionable service

  Because Mr. Askew no longer participates in this plan, his fixed annual
benefit at age 60 is $11,010 adjusted annually for inflation.

East Midlands Supplemental Retirement Benefit Plan. The U.K. Inland Revenue
also imposes limits on Pension Plan benefits. Under this benefit plan (known
in the U.K. as an Unfunded Unapproved Retirement Benefit Scheme), any Pension
Plan benefits reduced to these limitations will be reimbursed by this plan.
Mr. Askew's annual benefit at age 60 is expected to be $59,475. Mr. Askew's
payments under the Dominion Resources Retirement Plan will be reduced by the
amount he receives from this benefit plan and the East Midlands Pension Plan.

Executive Supplemental Retirement Plan.
The Supplemental Plan provides an annual retirement benefit equal to 25% of a
participant's final cash compensation (base salary plus target annual bonus).
To retire with full benefits under the Supplemental Plan, an executive must be
55 years old and have been employed by the Company for at least five years.
Benefits under the plan are provided either as a lump sum cash payment at
retirement or as a monthly annuity paid out, typically, over 10 years. Based
on 1998 cash compensation, the estimated annual benefit under this plan for
certain executives named in the Summary Compensation Table on p. 16 are: Mr.
Capps: $302,250; Mr. Askew: $187,500; Mr. Heavenridge: $118,125; Mr. Chewning:
$118,125; and Mr. Farrell: $116,250.


                                                                             20


<PAGE>


Other Executive Agreements
and Arrangements
                                                                             

Companies  that are in a rapidly  changing  industry  such as ours  require  the
expertise and loyalty of exceptional executives. Not only is the business itself
competitive,  but so is the demand for such  executives.  In order to secure the
continued  services  and focus of key  management  executives,  the  Company has
entered  into  employment  agreements  with them,  including  those named in the
Summary Compensation Table on p. 16.

Employment Agreement--Chief Executive Officer. The Board of Directors determined
in June 1997 that it was in the Company's best interest to secure Mr. Capps'
employment as CEO and President of Dominion Resources until December 31, 2002.
As a result, Mr. Capps and the Company entered into an agreement providing for
his employment as CEO and President until 2002. During his employment, the
agreement provides for the following:(1) an annual base salary of at least
$715,000, (2) incentive compensation awards based on performance and (3)
continued eligibility for all employee benefit and incentive plans provided by
the Company to its senior management. When his employment ends (whether or not
before the end of the term of the agreement), Mr. Capps will: (1) receive a
retirement benefit calculated on the highest base salary rate during his
employment, (2) receive a Supplemental Plan benefit payable for life, (3) become
fully vested in outstanding restricted stock and (4) receive a payment of
$950,000 plus an amount equal to the present value of his salary and annual cash
incentives for the calendar year 2002. During the term of the agreement, the
Company may terminate Mr. Capps for cause only. Mr. Capps also receives age and
service credit and continued benefit plan coverage through the end of the
contract period in the event of termination for cause or resignation for cause.

Employment Agreements--Other Executives. Messrs. Heavenridge, Chewning and
Farrell have an employment agreement for a three-year period ending September
12, 2000. Mr. Askew has an employment agreement that terminates November 1,
2002. During employment, each of these executives will continue to receive a
salary at least equal to his salary on the date of the agreement and will be
eligible for bonuses and all employee benefits provided by the Company to its
senior management. The agreements also provide executives with enhanced
retirement benefits. If Dominion Resources terminates the executive's employment
without cause or reduces or does not pay the executive's salary, incentives and
other benefits during the contract period or demotes the executive to a position
that is not a senior management position, the executive will (subject to notice
and remedy provisions): (1) receive a lump sum payment equal to the present
value of salary and, in the case of Mr. Heavenridge, Mr. Chewning and Mr.
Farrell, cash bonus for the balance of the contract period, (2) vest in his out



                                                                      21

<PAGE>

standing restricted stock and (3) receive age and service credit and continued
benefit plan coverage through the end of the contract period. The agreements
also provide benefits in the event of death or disability. In the case of a
change in control*, the executive will not receive pay under this agreement as a
result of his termination of employment for any reason if he receives payment
under his Employment Continuity Agreement (described on this page). Mr. Askew's
agreement also provides that he will not compete with the Company in the UK for
a one year period beginning with the date of termination of employment.

Special Arrangements.  Dominion Resources has entered into employment continuity
agreements with executives named in the Summary  Compensation Table (but not Mr.
Capps),  which  provide  benefits  in the  event of a change  in  control.  Each
agreement has a three-year term and is automatically  extended for an additional
year, unless cancelled by the Company.
  The  agreements  provide for the  continuation  of salary and  benefits  for a
maximum  period  of three  years  after  either  (1) a change  in  control,  (2)
termination  without  cause  following a change in control or (3) a reduction of
responsibilities,  salary and  incentives  following a change in control (if the
executive gives 60 days notice).  Payment of this benefit will be made in either
a lump sum or  installments  over  three  years.  In  addition,  the  agreements
indemnify the executives for potential penalties related to the Internal Revenue
Code and fees associated with the enforcement of the agreements. If an executive
is terminated for cause, the agreements are not effective.

Executive Deferred Compensation Plan. Under this plan, executives may defer
any portion of their base salary, annual incentive cash award and/or
long-term  incentive  cash award.  Deferrals  are  credited  at the  executive's
discretion,  for bookkeeping purposes,  with earnings and losses as if they were
invested in any of several  mutual fund  options or  Dominion  Resources  common
stock. Distributions are made at the direction of the executive.


- ---------------------------

* A change in  control  shall be deemed to have  occurred  if (i) any  person or
  group becomes a beneficial  owner of 20% or more of the combined  voting power
  of Dominion Resources' voting stock or (ii) as a direct or indirect result of,
  or in  connection  with,  a cash  tender or  exchange  offer,  merger or other
  business  combination,  sale of assets, or contested  election,  the Directors
  constituting the Dominion  Resources Board before any such transactions  cease
  to represent a majority of Dominion Resources' or its successor's Board within
  two years after the last of such transactions.


                                                                           22

<PAGE>

Item Two: Amendments to Dominion Resources Articles of Incorporation

Introduction                                           

Article V of Dominion  Resources  Articles of  Incorporation  requires  that the
Board of  Directors  be divided into three  classes,  with each class  serving a
three-year  term of office.  Article V also sets the maximum number of directors
at 16. Your Board of  Directors  is  recommending  that  Article V be amended to
eliminate  the  staggered  terms of office for  directors  and to  increase  the
maximum number of directors to seventeen.

While your Board recognizes that staggered terms can promote continuity of
experience and stability, it has concluded that these goals can also be met when
directors have one-year terms. The Board also recognizes that annual elections
are consistent with its views of good corporate governance. In addition, the
proposed amendments are consistent with the announced merger agreement between
your company and Consolidated Natural Gas Company. In that agreement, a copy of
which is on file with the Securities and Exchange Commission, the parties have
agreed to put in place at closing a board of seventeen members. PLEASE NOTE THAT
SHAREHOLDERS ARE NOT BEING ASKED TO VOTE ON THE MERGER AT THIS TIME. YOU WILL
HAVE THAT OPPORTUNITY AT A LATER DATE. THE AMENDMENTS ARE NOT CONDITIONED ON THE
MERGER AND, IF APPROVED, WILL TAKE EFFECT WITHOUT REGARD TO WHETHER OR WHEN THE
MERGER IS APPROVED.

On March 5, 1999, your Board unanimously approved these amendments. Each
director affected has consented to shorten his or her term of office.

Article V Amendments

Article V shall be amended, if approved by you, by deleting the first paragraph
of Article V and inserting the following in its place: 

     "The business and affairs of the Corporation shall be managed by or under
     the direction of a Board of Directors consisting of not less than ten nor
     more than seventeen Directors, the exact number of Directors to be
     determined from time to time by resolution adopted by the affirmative vote
     of a majority of the Directors then in office or at least two-thirds of the
     shares entitled to vote at a meeting of Stockholders. Each Director shall
     hold office until the next annual meeting and until his or her successor
     shall be elected and shall qualify, subject, however, to prior death,
     resignation, retirement, disqualification or removal from office. No
     decrease in the number of directors shall shorten the term of any incumbent
     Director."

 Also, the following sentence from the third paragraph of Article V will be
deleted:

   "In such  event,  the  successor  elected by the  stockholders  at the annual
   meeting  shall hold office for a term that shall  coincide with the remaining
   term of the class of Directors to which that person has been elected."

Your Board recommends that you vote infavor of the Amendments to Dominion 
Resources Articles of Incorporation

                                                                              23

<PAGE>

Item Three: Incentive Compensation Plan

Introduction

At the 1997 Annual Meeting of Shareholders, you approved the Dominion Resources,
Inc. Incentive  Compensation Plan. Working closely with management,  the Board's
Organization,   Compensation  and  Nominating   Committee  and  its  independent
consultant,  both  recommended  that the Plan be amended as described  below, in
order to provide greater  flexibility in awarding  incentives.  Also, in keeping
with the  Company's  focus  on  increased  share-ownership  among  officers  and
directors,  management  recommended  to the  Committee  that  the  Directors  be
eligible under this Plan.
  The proposed amendments are:
    1.To allow 11 million shares to be available for issuance under the
      Incentive Plan;
    2.To allow up to 1.5 million  shares to be allocated  to an Incentive  Award
      granted to any one participant in any one year;
    3.To allow the  Directors  to be eligible  for  Incentive  Awards  under the
      Incentive  Compensation Plan; and
    4.To  re-approve  Performance  Criteria  under the Plan in order to  satisfy
      certain IRS requirements.
  A summary of the Incentive Plan follows and the full text, before amended,  is
on file with the Securities and Exchange Commission.

Administration of the Plan; Eligibility

The Incentive Plan is  administered by the Virginia Power Committee for Virginia
Power  employees  and  those of its  affiliates  and by the  Dominion  Resources
Committee for Dominion Resources  employees and those of its other subsidiaries.
All employees of Dominion Resources and its subsidiaries are eligible to receive
Incentive  Awards under the  Incentive  Plan if a Committee  determines  that an
employee has  contributed,  or can be expected to contribute,  significantly  to
their employer.  The Committees have the power and complete discretion to select
eligible  employees to receive the Incentive Awards and to determine the type of
award and its terms and conditions.  Approximately  11,000 employees may receive
awards under the Incentive Plan. Under the proposed Amendment,  the non-employee
directors of Dominion  Resources and its subsidiaries  (currently,  18) would be
eligible to participate.

Amount of Stock Available for Incentive Awards

Under the proposed amendment, the shares available under the Plan would increase
from 3 million shares to 11 million shares and the annual limit of awards to any
one individual  would increase from 200,000 shares to 1.5 million shares.  These
increases will give the company greater  flexibility for the type of awards made
in the future.

Types of Incentive Awards That May Be Granted Under the Plan

The following types of Incentive Awards may be granted under the Incentive
Plan: Performance Grants, Restricted Stock, Goal-Based Stock, Stock Options
and Stock Appreciation Rights.

24


<PAGE>

Performance  Grants.  Performance  Grants  are  subject  to the  achievement  of
pre-established  Performance  Goals  and are  administered  to  comply  with the
requirements of Section 162(m). Performance Goals use objective and quantifiable
Performance  Criteria  that  include  measures  such as  asset  growth;  utility
earnings; generating unit efficiency;  combined net worth; debt to equity ratio;
earnings per share; revenues; operating income; operating cash flow; net income,
before or after  taxes;  return on total  capital,  equity,  revenue  or assets;
nonutility generation cost exposure;  power generation costs; safety measured in
fatalities, lost time, injuries and vehicle accidents;  environmental protection
measured in reportable  violations,  notices of  violations,  and  environmental
agency required  corrective  actions or enforcement  actions;  or economic value
added  (net  operating  profit  after tax less a charge  for use of  capital  as
determined under a methodology  approved by the Dominion Resources  Committee or
Virginia Power Committee). The Committees set target and maximum amounts payable
under the Performance  Grant. The employee receives the appropriate  payments at
the end of the performance  period if the Performance Goals (and other terms and
conditions of the award) were met. The actual payments under a Performance Grant
can be cash, Company Stock, or both.


     The aggregate maximum cash amount payable under the Plan to any employee in
any year cannot exceed 0.5% of Dominion Resources consolidated operating income,
before taxes and interest.  The Committee must make Performance  Grants prior to
the 90th day of the  period  for  which the  Performance  Grant  relates  or the
completion of 25% of such period.

Restricted  Stock Awards.  The Committees may grant  Restricted  Stock under the
Plan,  which will be Company Stock subject to certain terms and conditions.  The
employee  will not be able to sell or transfer  the  Restricted  Stock until the
restrictions  stated in the award agreement have been met. The Restricted  Stock
is forfeited if the restrictions are not met.

Goal-Based  Stock Awards.  The Committees may grant Goal-Based  Stock,  which is
Company  Stock  subject  to  Performance  Goals.  The stock is not issued to the
employee until a Committee  certifies that the Performance  Goals (and any other
terms and conditions) have been met.

Stock  Options and Stock  Appreciation  Rights.  The  Committees  may also grant
Options  to  eligible  employees  and  establish  the terms and  conditions  for
exercising  an Option.  Stock  Appreciation  Rights may be granted on all or any
part of an  Option,  and  also are  subject  to terms  and  conditions  set by a
Committee. Stock Appreciation Rights also may be granted separately.

  The exercise price of an Option will be at least 100% of the Fair Market Value
of Company  Stock on the date that the Option was  granted by a  Committee.  The
Options may be either Incentive Stock Options or Nonstatutory Options.

     A Stock Appreciation Right entitles the employee to receive an amount equal
to the  excess of (i) the fair  market  value on the date of  exercise  of stock
covered by the surrendered Stock  Appreciation  Right over (ii) the price of the
stock on the date the Stock  Appreciation  Right was  granted.  The award can be
paid in stock or cash, or both.

Transferability of Awards; Modification of Awards

When granting  Incentive  Awards,  the Committees can allow the awards to become
fully exercisable or vested upon a Change of Control.


                                                                           25


<PAGE>


     Employees  cannot sell,  transfer or pledge their  interest in  Performance
Grants and Goal-Based Stock awards.  Employees  cannot sell,  transfer or pledge
shares of Restricted Stock until it becomes unrestricted as provided in an award
agreement.  Options  and Stock  Appreciation  Rights  may be  transferable  by a
Participant according to the terms and conditions for such Awards.

Term; Modification of Plan

Following  shareholder  approval at the 1997 Annual Meeting,  the Incentive Plan
became effective as of January 1, 1997. The Incentive Plan will terminate at the
close of business on December  31, 2006 unless the Dominion  Resources  Board of
Directors terminates it prior to that date.

     The  Dominion  Resources  Board of  Directors  can amend or  terminate  the
Incentive Plan with respect to Dominion Resources  participants and the Virginia
Power Board of Directors can amend or terminate the Incentive  Plan with respect
to  Virginia  Power  participants,  except  that only  shareholders  can approve
amendments  that would (i) increase  the number of shares of Company  Stock that
are  reserved  and  available  for  issuance  under  the  Incentive  Plan;  (ii)
materially  change or impact which  employees are eligible to participate in the
Incentive Plan; or (iii) materially change the benefits that eligible  employees
may receive  under the  Incentive  Plan.  However,  the Dominion  Resources  and
Virginia  Power Boards can amend the  Incentive  Plan as  necessary  and without
shareholder  approval to ensure that the Incentive Plan continues to comply with
Section 162(m) of the Code and Rule 16b-3. Federal Income Tax Consequences

An  employee  will not incur  federal  income  tax  liabilities  when  granted a
Nonstatutory Stock Option, an Incentive Stock Option, a Stock Appreciation Right
or Restricted Stock.

     Upon exercise of a Nonstatutory  Option or a Stock Appreciation  Right, the
employee,  in most  circumstances,  will be treated as having received  ordinary
income equal to the difference between the fair market value of Company Stock on
the date of the exercise and the Option Price.  This income is subject to income
tax  withholding by the company.  No income is received for tax purposes when an
Incentive  Stock  Option is  exercised,  unless an  employee  is  subject to the
alternative minimum tax.

     The company usually will be entitled to a business expense deduction at the
time and in the amount  that the  recipient  of an  Incentive  Award  recognizes
ordinary  income.  As  stated  above,  this  usually  occurs  upon  exercise  of
Nonstatutory Options and Stock Appreciation Rights and the lapse of restrictions
on restricted  stock.  No deduction is allowed in  connection  with an Incentive
Stock  Option  unless the  employee  disposes  of Company  Stock  received  upon
exercise in  violation  of the holding  period  requirements.  Also there can be
circumstances when the deduction is not allowed for certain transfers of Company
Stock or payments to an employee  upon the exercise of an  Incentive  Award that
has been accelerated as a result of a Change of Control.

The Board of Directors recommends that YOU vote IN FAVOR of the Amendments to
the Dominion Resources, Inc. Incentive Compensation Plan.


26


<PAGE>

Auditors

The Board of  Directors  has  re-appointed  Deloitte & Touche  LLP,  independent
certified public  accountants,  as auditors of the 1999  consolidated  financial
statements of Dominion Resources.  Representatives of Deloitte & Touche LLP will
be  present  at the  Annual  Meeting  and  will  have an  opportunity  to make a
statement  if  they  desire  to do so  and  will  be  available  to  respond  to
shareholder questions.


Other Information

Matters Before the 1999
Annual Meeting

The  management and directors are not aware of any matters which may come before
the  Annual  Meeting  other  than the  matters  stated in this  Notice of Annual
Meeting.

Proposals for the
2000 Annual Meeting

Under our Bylaws, if you wish to bring any
matter (other than shareholder  nominations of director  candidates)  before the
2000 Annual Meeting, you must notify the Corporate Secretary
in writing no later than January 24, 2000. Regarding each matter, the notice
must contain:
    o a brief  description  of the  business  to be  brought  before  the Annual
      Meeting,  including  the complete  text of any related  resolutions  to be
      presented and the reasons for conducting such business at the meeting;
    o the name and address of record of the shareholder proposing
      such business;
    o the class and number of shares of stock that are beneficially
      owned by the shareholder; and
    o any material interest of the shareholder in such business.

  If you do not provide the proper notice by January 24, 2000, the Chairman of
the  meeting  may  exclude  the  matter,  and it will not be  acted  upon at the
meeting.  If the Chairman  does not exclude the matter,  the proxies may vote in
the  manner  they  believe  is  appropriate,  as  the  Securities  and  Exchange
Commission's rules allow.
  For a shareholder proposal to be considered for possible inclusion in the 2000
Proxy  Statement,  it must be received by the  Corporate  Secretary  of Dominion
Resources no later than November 15, 1999.  Dominion Resources plans to hold its
2000 Annual Meeting on April 21, 2000.

1998 Form 10-K

You may request,  without charge,  a copy of Dominion  Resources'  Annual Report
filed  with the  Securities  and  Exchange  Commission  for  1998 on Form  10-K,
excluding  exhibits,  by:  (1)  writing  to the  Corporate  Secretary,  Dominion
Resources,  Inc., P.O. Box 26532,  Richmond,  Virginia 23261;  (2) sending us an
e-mail at dominion_resources@domres.com; or (3) calling us at 804-819-2000.




                                                                             27

<PAGE>


<TABLE>
<S> <C>
1.  Election of Directors           1. John W. Harris   2. Kenneth A. Randall
  [ ] FOR the following nominees:   3. Judith B. Warrick     4. David A. Wollard

  [ ]  Withhold  Authority to vote for all  nominees  listed  above.  To withhold
       authority to vote for any individual  nominee,  write that nominee's name
       in the following space:

 ...............................................................................



 2.Proposal to amend the Articles of Incor-poration to eliminate  classification
   of Board of Directors and to increase the maximum number of Directors to 17.

      [ ] For    [ ] Against   [ ] Abstain


 3.Proposal to approve amendments to the Dominion Resources, Inc., Incentive 
   Compensation Plan.

      [ ] For    [ ]  Against   [ ]  Abstain


The undersigned appoints John B. Adams, Jr., Frank S. Royal, M.D. and Patricia
A. Wilkerson, or any one of them, with the power of substitution, proxies to
vote all shares of the undersigned at the Annual Meeting of Shareholders on
April 16, 1999, and at any and all adjournments thereof.

Date ...................................................................  , 1999

 ...............................................................................

Signature

 ...............................................................................
Signature (if held jointly)


This  Proxy is  solicited  on  behalf of the  Board of  Directors.  The Board of
Directors Recommends a Vote "FOR" Items 1, 2 and 3.

[DOMINION RESOURCES LOGO]


<PAGE>


The 1999 Proxy Card                [DOMINION RESOURCES LOGO]

This Proxy is solicited on behalf of the Board of Directors.

Dominion Resources, Inc.
P.O. Box 26532
Richmond, Virginia 23261


Please mark, date, sign and mail in the enclosed envelope.


In their discretion, the proxies are authorized to vote on any matters that 
properly come before the meeting.

  This proxy when properly executed will be voted as directed by the signed
shareholder. If no direction is made, this proxy will be voted "FOR" Items 1,
2 and 3.

  Please sign  exactly as your name  appears on the reverse  side of this proxy.
When shares are held by joint tenants, both shareholders should sign.

  When signing in a  representative  capacity,  please give your  representative
title.  If a  corporation,  please sign in full  corporate  name by President or
other authorized officer.  If a partnership,  please sign in partnership name by
authorized person.


<PAGE>


Vote Your Proxy

- -> By Internet Access the Website at http://www.votefast.com
- -> By Telephone Call toll-free 1-800-250-9081
- -> By Mail     Return your proxy in the postage-paid envelope provided.

Your Control Number Is:


Dominion Resources is pleased to offer you three ways to vote your 1999 Proxy.

     When voting by internet or telephone, you will be prompted to enter your
control number. Simple prompts will be presented to you to record your vote.
Internet and telephone votes must be received by 5:00 p.m. EDT on Tuesday, April
13, 1999 to be counted in the final tabulation.

  If you vote by internet or  telephone,  do not return your proxy card by mail.

  If you choose to vote by mail, please mark, date and sign your proxy card.
Please use the postage-paid envelope to return your proxy.


If you are voting by mail,  please  fold and detach card at  perforation  before
mailing in the enclosed envelope.


1.                             Election of Directors  1. John W. Harris 2. 
Kenneth A. Randall
      FOR the following nominees:              3. Judith B. Warrick     4. 
David A. Wollard

      Withhold  Authority to vote for all  nominees  listed  above.  To withhold
       authority to vote for any individual  nominee,  write that nominee's name
       in the following space:

 ...............................................................................


This  Proxy is  solicited  on  behalf of the  Board of  Directors.  The Board of
Directors Recommends a Vote "FOR" Items 1, 2 and 3.


 2.Proposal to amend the Articles of Incor-poration to eliminate  classification
   of Board of Directors and to increase the maximum number of Directors to 17.

      For      Against    Abstain


 3.Proposal to approve amendments to 
   the Dominion Resources, Inc., Incentive Compensation Plan.

      For      Against    Abstain


Date                        , 1999
 ...............................................................................
Signature
 ...............................................................................


please date and sign on other sidE.

The 1999 Proxy Card

This Proxy is solicited on behalf of the Board of Directors.

       Dominion Resources, Inc.
         Employee Savings Plan

Dominion Subsidiary Savings Plan

        Virginia Power Hourly
         Employee Savings Plan

Voting Instructions are solicited by       
Mellon Bank, N.A., the Plan's Trustee

       For the Annual Meeting
of Shareholders, April 16, 1999

I  acknowledge  receipt of the Notice of Annual  Meeting,  Proxy  Statement  and
Annual  Report  relating  to the Annual  Meeting  of  Shareholders  of  Dominion
Resources and I hereby  instruct  Mellon Bank,  N.A., as Trustee of the Dominion
Resources, Inc. Employee Savings Plan, the Dominion Subsidiary Savings Plan, and
the Virginia Power Hourly Employee  Savings Plan, to vote the shares of Dominion
Resources  Common Stock,  relating to my Plan account for which I have the right
to give voting instructions

under the Plan, at such Annual  Meeting in the manner set forth hereon.  If this
card is not received on or before the close of business on April 13,  1999,  the
Trustee  cannot  ensure that your voting  instruc-tions  will be  tabulated  and
counted. This voting instruction card, when properly executed,  will be voted as
directed.  If such card is returned  executed with no direction  given or is not
returned at all, the Trustee  generally  will vote your shares  according to the
Board's recommendations.



Your instructions will be kept confidential.




<PAGE>

Vote Your Proxy

3            
 3             
 3        
Your Control Number Is:



                                              

Dominion Resources is pleased to offer you three ways to vote your 1999 Proxy.
  When voting by internet or telephone,
you will be  prompted  to enter your  control  number.  Simple  prompts  will be
presented  to you to record  your vote.  Internet  and  telephone  votes must be
received by 5:00 p.m. EDT on Thursday, April 15, 1999 to be counted in the final
tabulation.
  If you vote by internet or telephone, do not return your proxy card by mail.
  If you choose to vote by mail, please mark, date and sign your proxy card. Please
use the postage-paid envelope to return your proxy.


If you are voting by mail,  please  fold and detach card at  perforation  before
mailing in the enclosed envelope.




1. Election of Directors                   1. John W. Harris        2. Kenneth A. Randall
      FOR the following nominees:          3. Judith B. Warrick     4. David A. Wollard

      Withhold  Authority to vote for all  nominees  listed  above.  To withhold
       authority to vote for any individual  nominee,  write that nominee's name
       in the following space:

 ....................................................................................



 2.Proposal to amend the Articles of Incor-poration to eliminate  classification
   of Board of Directors and to increase the maximum number of Directors to 17.

      For      Against    Abstain


 3.Proposal to approve amendments to
   the Dominion Resources, Inc., Incentive Compensation Plan.

      For      Against    Abstain


The undersigned appoints John B. Adams, Jr., Frank S. Royal, M.D. and Patricia A.
Wilkerson, or any one of them, with the power of substitution, proxies to vote all
shares of the undersigned at the Annual Meeting of Shareholders on April 16, 1999,
and at any and all adjournments thereof.
Date                        , 1999
 ....................................................................................
Signature
 ....................................................................................
Signature (if held jointly)


This  Proxy is  solicited  on  behalf of the  Board of  Directors.  The Board of
Directors Recommends a Vote "FOR" Items 1, 2 and 3.

please date and sign on other sidE.

The 1999 Proxy Card

This Proxy is solicited on behalf of the Board of Directors.


Dominion Resources, Inc.
P.O. Box 26532
Richmond, Virginia 23261




In their discretion, the proxies are
authorized to vote on any matters that properly come before the meeting.
  This proxy when properly executed will be voted as directed by the signed
shareholder. If no direction is made, this proxy will be voted "FOR" Items 1, 2 
and 3.
  Please sign  exactly as your name  appears on the reverse  side of this proxy.
When shares are held by joint tenants, both shareholders should sign.


  When signing in a  representative  capacity,  please give your  representative
title.  If a  corporation,  please sign in full  corporate  name by President or
other authorized officer.  If a partnership,  please sign in partnership name by
authorized person.

</TABLE>


<PAGE>

                            DOMINION RESOURCES, INC.
                           INCENTIVE COMPENSATION PLAN

         AMENDMENT to the Dominion Resources,  Inc. Incentive  Compensation Plan
(the "Plan") by Dominion Resources, Inc. (the "Company").

         The Company  maintains  the Plan for the benefit of its  employees.  By
action of its Board of  Directors,  the Company has the power to amend the Plan,
and now wishes to do so.


I.   Section 2(v) of the Plan is amended to read as follows:

         (a)  "Performance  Criteria"  means  any  of  the  following  areas  of
performance  of  DRI,  Virginia  Power,  any  Nonregulated   Subsidiary  or  any
Affiliate: asset growth; utility earnings; generating unit efficiency;  combined
net worth; debt to equity ratio; earnings per share; revenues; operating income;
operating cash flow; net income, before or after taxes; return on total capital,
equity, revenue or assets; nonutility generation cost exposure; power generation
costs; safety measured in fatalities, lost time, injuries and vehicle accidents;
environmental   protection  measured  in  reportable   violations,   notices  of
violations,  and environmental agency required corrective actions or enforcement
actions;  or economic value added (net operating  profit after tax less a charge
for use of  capital  as  determined  under  a  methodology  approved  by the DRI
Committee or Virginia Power Committee).

II.  Section  4 of the Plan is  amended  by  deleting  the  first  sentence  and
     inserting the following in its place:

         Subject to Section 15 of the Plan, there shall be reserved for issuance
under the Plan an aggregate  of eleven  million  (11,000,000)  shares of Company
Stock, which shall be authorized, but unissued shares.

III. Section 4 of the Plan is further  amended by deleting the last sentence and
     inserting the following in its place:

         No more than one million five hundred thousand  (1,500,000)  shares may
be allocated to the  Incentive  Awards,  including the maximum  amounts  payable
under a Performance Grant, that are granted to any individual Participant during
any single Taxable Year.

IV. A new Section 19 is added to the Plan as follows:

19. Grants To Outside  Directors.  In addition to the Awards otherwise  provided
under the Plan,  the Plan also permits the award of  Nonstatutory  Stock Options
and Restricted  Stock to directors on the DRI Board, the Virginia Power Board or
the board of any Affiliate or Nonregulated  Subsidiary if such directors are not
employees of DRI,  Virginia Power,  or any Affiliate or Nonregulated  Subsidiary
("Outside  Directors").  The  DRI  Board  shall  have  the  power  and  complete
discretion to select Outside Directors of DRI or any Nonregulated  Subsidiary to
receive  Awards.  The DRI  Board  shall  have  the  complete  discretion,  under
provisions consistent with Section 12 as to Participants, to determine the terms
and conditions, the nature of the award and the number of shares to be allocated
as part  of each  Award  for  each  Outside  Director  of DRI or a  Nonregulated
Subsidiary.  The  Virginia  Power  Board  shall  have  the  power  and  complete
discretion  to select  Outside  Directors of Virginia  Power or any Affiliate to
receive  Awards.  The Virginia  Power Board shall have the complete  discretion,
under provisions consistent with Section 12 as to Participants, to determine the
terms and  conditions,  the  nature of the award and the  number of shares to be
allocated as part of each Award for each Outside  Director of Virginia  Power or
an Affiliate.  The grant of an Award shall not obligate DRI,  Virginia  Power or
any Affiliate or  Nonregulated  Subsidiary to make further grants to the Outside
Director at any time  thereafter  or to retain any person as a director  for any
period of time.

V. In all respects not amended, the Plan is ratified and confirmed.