SECURITIES AND EXCHANGE COMMISSION

                          Washington, D. C. 20549


                                  FORM 8-K

                               CURRENT REPORT


                     Pursuant to Section 13 or 15(d) of
                    the Securities Exchange Act of 1934


    Date of report (Date of earliest event reported):  June 1, 1998


                                ASHLAND INC.
           (Exact name of registrant as specified in its charter)


                                  Kentucky
               (State or other jurisdiction of incorporation)

       1-2918                                       61-0122250
(Commission File Number)                         (I.R.S. Employer
                                                Identification No.)


 1000 Ashland Drive, Russell, Kentucky                 41169
(Address of principal executive offices)            (Zip Code)


P.O. Box 391, Ashland, Kentucky                        41114
        (Mailing Address)                           (Zip Code)


    Registrant's telephone number, including area code (606) 329-3333






    Item 5.  Other Events

         On June 1, 1998, Arch Coal, Inc. (Arch Coal) announced that it had
    completed  the  acquisition  of  Atlantic  Richfield  Company's  (ARCO)
    domestic  coal  operations  for   approximately   $1.14  billion.   The
    transaction  will be  financed  entirely  with debt  using  new  credit
    facilities.
         Completion of the  transaction  creates a new joint venture called
    Arch Western Resources, LLC (Arch Western Resources), owned 99% by Arch
    Coal and 1% by ARCO.  Arch  Western  Resources  will account for all of
    Arch Coal's  operating  activity  west of the  Mississippi  River.  The
    Registrant owns approximately 55% of Arch Coal's issued and outstanding
    shares.  The  foregoing  summary  of  the  attached  press  release  is
    qualified in its entirely by the complete text of such document, a copy
    of which is attached hereto.
Item 7.  Financial Statements and Exhibits

    (c)  Exhibits
         99.1     Press Release dated June 1, 1998.






                                 SIGNATURES


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

                                      ASHLAND INC.
                                     (Registrant)



    Date:  June 1, 1998
                                      Name:     Thomas L. Feazell
                                      Title:    Senior Vice President,
                                                 General Counsel and Secretary




                               Exhibit Index

            Exhibit No.

         99.1     Press Release dated June 1, 1998.


News from
Arch Coal, Inc.
                                  FOR FURTHER INFORMATION:

                                  David G. Todd                Deck S. Slone
                                  Vice President                     Manager
                                  External Affairs        Communications and
                                  (304) 526-3755              Public Affairs
                                                              (314) 994-2717

                                                       FOR IMMEDIATE RELEASE
                                                                June 1, 1998

ARCH COAL COMPLETES ACQUISITION OF
ATLANTIC RICHFIELD'S DOMESTIC COAL OPERATIONS

         St. Louis, MO -- Arch Coal, Inc.  (NYSE:ACI)  announced today that
it has  completed the  acquisition  of Atlantic  Richfield's  domestic coal
operations for approximately $1.14 billion. The transaction makes Arch Coal
the nation's  second  largest coal  producer  with  expected  coal sales of
nearly 110 million tons annually,  annual revenues of about $2 billion, and
a reserve base of approximately 3.4 billion tons.

         "We believe this  transaction  will create  substantial  long-term
value for our  shareholders,"  said  Steven F.  Leer,  president  and chief
executive  officer.  "With the addition of the ARCO properties,  we can now
supply a wide  range  of coal  products  in a  cost-competitive  manner  to
virtually every major coal-fired power plant in the United States."

         "We will now turn our full  attention  to  integrating  these  new
operations  into Arch Coal," Leer added.  "We have a strong track record of
successful  integration  efforts and a great deal of  experience  operating
large-scale surface and longwall mines such as those we have just acquired.
Furthermore,  the men and women at these mines have  demonstrated that they
share  our  commitment  to  operating  in a  safe,  highly  productive  and
environmentally  responsible  manner. For these reasons,  we expect a quick
and efficient integration process."

         The  completion  of the  transaction  creates a new joint  venture
called Arch Western Resources,  LLC. Arch Western Resources is comprised of
the former ARCO Coal Company  properties in Wyoming,  Colorado and Utah, as
well as properties Arch Coal owned and operated in southern  Wyoming.  Arch
has a 99%  interest in the new joint  venture  and ARCO has a 1%  interest.
Arch  Western  Resources  will  account  for all of Arch  Coal's  operating
activity west of the Mississippi River.

         The  transaction  will be  financed  entirely  with debt using new
credit  facilities that became effective today. As part of these new credit
facilities,  Arch  Coal  terminated  its  existing  credit  facilities  and
redeemed $35.7 million in senior notes. The termination of these agreements
will result in a $2.4 million pre-tax charge in the second quarter of 1998.

         "One great  strength  of the  expanded  company is its  ability to
generate  strong levels of cash flow," Leer said. "We plan to use free cash
flow both to fund  additional  growth  and to pay down debt in a steady and
aggressive  fashion." In 1997 on a pro forma combined basis,  Arch Coal and
ARCO's  domestic  coal  operations  generated  more  than $400  million  in
earnings  from  operations  before the  effects  of  changes in  accounting
principles, non-recurring charges, interest, taxes, depreciation, depletion
and amortization (EBITDA).

         EBITDA is  presented  because  it is a widely  accepted  financial
indicator of a company's  ability to incur and service debt.  EBITDA should
not  be  considered  in  isolation  or as an  alternative  to  net  income,
operating income, cash flows from operations or as a measure of a company's
profitability, liquidity or performance under generally accepted accounting
principles.  Certain  matters  discussed  within  this  press  release  are
forward-looking  statements  within the meaning of the  Private  Securities
Litigation  Reform Act of 1995.  Although  Arch  Coal,  Inc.  believes  the
expectations  reflected  in such  forward-looking  statements  are based on
reasonable assumptions, it can give no assurance that its expectations will
be attained.  Factors that could cause actual results to differ  materially
from  expectations  include  financial  performance,  changes  in  local or
national economic conditions, and other risks detailed from time to time in
the  Company's  SEC  reports,  including  quarterly  reports  on Form 10-Q,
reports on Form 8-K, and annual reports on Form 10-K.

         Arch  Coal is the  nation's  second  largest  coal  producer  with
subsidiary  operations  in West  Virginia,  Kentucky,  Virginia,  Illinois,
Wyoming,  Colorado and Utah.  Through these operations,  Arch Coal provides
the fuel for approximately 6% of the nation's electric power generation.