SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.
                                      20549

                                    FORM S-8
                          REGISTRATION STATEMENT UNDER
                           THE SECURITIES ACT OF 1933

                             KENAN TRANSPORT COMPANY
                             -----------------------
             (Exact name of registrant as specified in its charter)

   North Carolina                                               56-0516485
   -----------------------------------------------------------------------
(State or other jurisdiction                               (I.R.S. Employer
of incorporation or organization)                           Identification No.)

                 University Square-West, 143 W. Franklin Street
                     Chapel Hill, North Carolina 27516-3910
                     --------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

                             KENAN TRANSPORT COMPANY
                          1998 LONG-TERM INCENTIVE PLAN
                          -----------------------------
                            (Full title of the plan)

                        WILLIAM L. BOONE, VICE PRESIDENT
                             Kenan Transport Company
                 University Square-West, 143 W. Franklin Street
                     Chapel Hill, North Carolina 27516-3910
                     --------------------------------------
                     (Name and address of agent for service)

                              (919) 967-8221
                              --------------
       (Telephone number, including area code, of agent for service)

                         CALCULATION OF REGISTRATION FEE

                                     Proposed        Proposed
Title of                             Maximum         Maximum
Securities                           Offering        Aggregate     Amount of
to be           Amount to be         Price           Offering      Registration
registered      Registered           Per Share*      Price*        Fee
-------------------------------------------------------------------------------

Common Stock    450,000 shares       $31.50          $14,175,000*  $4,181.63*
                                                      ----------    --------
no par value

*Pursuant  to Rule  457(h),  the average of the high and low price of the Common
Stock as reported on NASDAQ's  National  Market System on July 24, 1998 has been
used to calculate the amount of the registration fee.




<PAGE>





         This  Registration  Statement on Form S-8 covers  450,000 shares of the
Common Stock, no par value (the "Common Stock"), of Kenan Transport Company (the
"Registrant") issuable upon exercise of options,  exercise of stock appreciation
rights or grant of stock bonuses, in each case pursuant to the Registrant's 1998
Long-Term Incentive Plan (the "Plan").

                                              PART II

                        INFORMATION REQUIRED IN THE REGISTRATION STATEMENT


Item 3.  Incorporation of Documents by Reference.
         ---------------------------------------
         The  Registrant  is subject to the  informational  requirements  of the
Securities  Exchange  Act of  1934  (the  "Exchange  Act"),  and  in  accordance
therewith files reports and other  information  with the Securities and Exchange
Commission. The following documents have previously been filed by the Registrant
with  the  Commission  and are  incorporated  herein  by  reference  as of their
respective dates:

  (a)  Annual Report on Form 10-K for the fiscal year ended December 31, 1997.

  (b)    (i)  Amendment to Current Report on Form 8-K/A dated
              February 12, 1998.

        (ii)  Current Report on Form 8-K dated March 13, 1998.

        (iii) Quarterly   Report  on  Form  10-Q  for  the
              quarter ended March 31, 1998.

        (iv)  Amendment to Current Report on Form 8-K/A dated
                                    May 13, 1998.

  (c)  The description of the Common Stock of the Registrant set forth under the
     heading  "Description of  Registrant's  Securities to be Registered" in the
     Registrant's  Form 10 (File No.  0-12058)  filed  with the  Securities  and
     Exchange Commission.

         All documents that are hereafter  filed by the  Registrant  pursuant to
Sections  13,  14 and  15(d)  of the  Exchange  Act,  prior to the  filing  of a
post-effective  amendment  which  indicates  that all shares of the Common Stock
issuable pursuant to the Plan have been issued or which


                                                             2

<PAGE>



deregisters  any  shares  then  remaining  unissued,   shall  be  deemed  to  be
incorporated herein by reference and to be a part hereof from the date of filing
of such documents.

Item 4.           Description of Securities.
                  -------------------------
         Not Applicable.

Item 5.           Interests of Named Experts and Counsel.
                  ---------------------------------------
         Legal matters in connection  with the securities  registered  hereunder
are being passed upon for the Registrant by Schell Bray Aycock Abel & Livingston
P.L.L.C., Renaissance Plaza, 230 North Elm Street, Suite 1500, Greensboro, North
Carolina 27401.  Braxton Schell,  a partner of that firm, has been a director of
the Registrant since 1986.

Item 6.           Indemnification of Directors and Officers.
                  -----------------------------------------
         Article VIII of the Registrant's Bylaws provides:

                          ARTICLE VIII

                          Indemnification
                          ---------------

         1. Extent.  In addition to the  indemnification  otherwise  provided by
law,  the  corporation  shall  indemnify  and hold  harmless its  directors  and
officers  against  liability  and  litigation  expense,   including   reasonable
attorneys'  fees,  arising out of their status as directors or officers of their
activities in any of such  capacities or in any capacity in which any of them is
or  was  serving,  at  the  corporation's   request,  in  another   corporation,
partnership, joint venture, trust or other enterprise, and the corporation shall
indemnify  and hold  harmless  those  directors,  officers or  employees  of the
corporation  who are  deemed to be  fiduciaries  of the  corporation's  employee
pension and  welfare  benefit  plans as defined  under the  Employee  Retirement
Income  Security  Act of 1974,  as amended  ("ERISA  fiduciaries")  against  all
liability and litigation expense,  including reasonable attorneys' fees, arising
out of their status or activities as ERISA fiduciaries;  provided, however, that
the corporation  shall not indemnify a director or officer against  liability or
litigation  expense that he may incur on account of his  activities  that at the
time taken were known or reasonably  should have been known by him to be clearly
in conflict  with the best  interests of the  corporation,  and the  corporation
shall not  indemnify an ERISA  fiduciary  against any  liability  or  litigation
expense  that he may incur on account of his  activities  that at the time taken
were known or reasonably should have been known by him to be clearly in conflict
with the best  interests  of the employee  benefit plan to which the  activities
relate.  The corporation shall also indemnify the director,  officer,  and ERISA
fiduciary for reasonable costs,  expenses and attorneys' fees in connection with
the enforcement of rights to indemnification granted herein, if it is determined
in accordance with


                                                             3

<PAGE>



Section 2 of this  Article  that the  director,  officer or ERISA  fiduciary  is
entitled to indemnification hereunder.

         2. Determination.  Any indemnification  under Section 1 of this Article
shall be paid by the corporation in any specific case only after a determination
that the director,  officer or ERISA  fiduciary did not act in a manner,  at the
time the activities  were taken,  that was known or reasonably  should have been
known  by  him  to be  clearly  in  conflict  with  the  best  interests  of the
corporation, or the employee benefit plan to which the activities relate, as the
case may be. Such  determination  shall be made (a) by the affirmative vote of a
majority  (but not less than two) of  directors  who are or were not  parties to
such  action,  suit or  proceeding  or against  whom any such claim is  asserted
("disinterested directors") even though less than a quorum, or (b) if a majority
(but not less than two) of  disinterested  directors so direct,  by  independent
legal  counsel  in a  written  opinion,  or (c)  if  there  are  less  than  two
disinterested directors, by the affirmative vote of all of the directors, or (d)
by the vote of a majority of all of the voting  shares other than those owned or
controlled by directors,  officers or ERISA fiduciaries who were parties to such
action,  suit or  proceeding  or against whom such claim is  asserted,  or by an
unanimous  vote of all of the  voting  shares,  or (e) by a court  of  competent
jurisdiction.

         3. Advanced Expenses. Expenses incurred by a director, officer or ERISA
fiduciary in defending a civil or criminal  claim,  action,  suit or  proceeding
may, upon  approval of a majority  (but not less than two) of the  disinterested
directors,  even  though  less  than a  quorum,  or,  if there are less than two
disinterested  directors,  upon unanimous approval of the Board of Directors, be
paid by the  corporation  in advance  of the final  disposition  of such  claim,
action, suit or proceeding upon receipt of an undertaking by or on behalf of the
director,  officer  or ERISA  fiduciary  to repay  such  amount  unless it shall
ultimately  be  determined  that he is entitled to be  indemnified  against such
expenses by the corporation.

         4. Corporation.  For purposes of this Article, references to directors,
officers or ERISA  fiduciaries of the  "corporation"  shall be deemed to include
directors,  officers  and ERISA  fiduciaries  of Kenan  Transport  Company,  its
subsidiaries,  and all  constituent  corporations  absorbed into Kenan Transport
Company or any of its subsidiaries by a consolidation or merger.

         5. Reliance and Consideration. Any director, officer or ERISA fiduciary
who at any time after the  adoption of this Bylaw serves or has served in any of
the aforesaid  capacities for or on behalf of the corporation shall be deemed to
be doing or to have done so in reliance  upon,  and as  consideration  for,  the
right of indemnification  provided herein. Such right shall inure to the benefit
of the legal  representatives  of any such person and shall not be  exclusive of
any other rights to which such person may be entitled  apart from the  provision
of this Bylaw.  No amendment,  modification or repeal of this Article VIII shall
adversely  affect  the right of any  director,  officer  or ERISA  fiduciary  to
indemnification  hereunder with respect to any activities occurring prior to the
time of such amendment, modification or repeal.


                                                             4

<PAGE>



         6. Insurance.  The  corporation may purchase and maintain  insurance on
behalf of its  directors,  officers,  employees and agents and those persons who
were serving at the request of the corporation as a director,  officer,  partner
or trustee of, or in some other capacity in, another  corporation,  partnership,
joint venture,  trust or other enterprise against any liability asserted against
him and  incurred by him in any such  capacity,  or arising out of his status as
such,  whether  or not the  corporation  would have the power to  indemnify  him
against such liability  under the  provisions of this Article or otherwise.  Any
full or partial payment made by an insurance  company under any insurance policy
covering  any  director,  officer,  employee  or agent made to or on behalf of a
person  entitled  to  indemnification  under  this  Article  shall  relieve  the
corporation of its liability for indemnification provided for in this Article or
otherwise to the extent of such  payment,  and no insurer  shall have a right of
subrogation against the corporation with respect to such payment.

         The North Carolina General Statutes contain provisions  prescribing the
extent  to which  directors  and  officers  shall or may be  indemnified.  These
statutory provisions are set forth below:

                           CH. 55 N.C. BUSINESS CORPORATION ACT

                           Part 5. Indemnification.

ss. 55-8-50.  Policy Statement and Definitions.

 (a)    It is the  public  policy  of this  State  to  enable  corporations
organized  under this  Chapter to attract and  maintain  responsible,  qualified
directors,  officers,  employees  and  agents,  and,  to  that  end,  to  permit
corporations  organized  under this  Chapter to  allocate  the risk of  personal
liability of directors,  officers,  employees and agents through indemnification
and insurance as authorized, in this Part.

 (b)   Definitions in this Part:

     (1)  "Corporation" includes any domestic or foreign predecessor entity of a
          corporation   in  a  merger   or  other   transaction   in  which  the
          predecessor's existence ceased upon consummation of the transaction.

     (2)  "Director"means   an  individual  who  is  or  was  a  director  of  a
          corporation  or an individual  who, while a director of a corporation,
          is or was serving at the corporation's request as a director, officer,
          partner,  trustee,  employee,  or agent of another foreign or domestic
          corporation, partnership, joint venture, trust, employee benefit plan,
          or other  enterprise.  A  director  is  considered  to be  serving  an
          employee  benefit plan at the  corporation's  request if his duties to
          the corporation  also impose duties on, or otherwise  involve services
          by, him to the


                                                             5

<PAGE>



plan or to participants in or  beneficiaries of the plan.  "Director"  includes,
unless  the   context   requires   otherwise,   the   estate  or   personal
representative of a director.

     (3)  "Expenses"  means  expenses  of every kind  incurred  in  defending  a
          proceeding, including counsel fees.

     (4)  "Liability"  means  the  obligation  to  pay a  judgment,  settlement,
          penalty,  fine  (including  an excise tax assessed  with respect to an
          employee benefit plan), or reasonable  expenses  incurred with respect
          to a proceeding.

     (5)  "Official  capacity"  means: (i) when used with respect to a director,
          the  office  of  director  in a  corporation;  and (ii) when used with
          respect to an individual  other than a director,  as  contemplated  in
          G.S.  55-8-56,  the office in a corporation held by the officer or the
          employment or agency relationship  undertaken by the employee or agent
          on behalf of the  corporation.  "Official  capacity"  does not include
          service  for  another   foreign  or   domestic   corporation   or  any
          partnership,  joint venture,  trust,  employee  benefit plan, or other
          enterprise.

     (6)  "Party"  includes an  individual  who was, is, or is  threatened to be
          made a named defendant or respondent in a proceeding.

     (7)  "Proceeding" means any threatened, pending, or completed action, suit,
          or   proceeding,   whether   civil,   criminal,   administrative,   or
          investigative and whether formal or informal.

ss. 55-8-51.  Authority to Indemnify.

(a) Except as  provided  in  subsection  (d), a  corporation  may  indemnify  an
individual made a party to a proceeding  because he is or was a director against
liability incurred in the proceeding if:

               (1)  He conducted himself in good faith; and

               (2)  He  reasonably  believed  (i) in the case of  conduct in his
                    official capacity with the corporation, that his conduct was
                    in its best interests; and (ii) in all other cases, that his
                    conduct was at least not opposed to its best interests; and

               (3)  In the case of any criminal proceeding, he had no reasonable
                    cause to believe his conduct was unlawful.

(b) A director's  conduct with respect to an employee benefit plan for a purpose
he  reasonably  believed  to be in  the  interests  of the  participants  in and
beneficiaries  of  the  plan  is  conduct  that  satisfies  the  requirement  of
subsection (a)(2)(ii).


                                                             6

<PAGE>



(c) The termination of a proceeding by judgment, order, settlement,  conviction,
or upon a plea of no contest or its equivalent is not, of itself,  determinative
that the  director  did not meet  the  standard  of  conduct  described  in this
section.

(d) A corporation may not indemnify a director under this section:

     (1) In connection  with a proceeding by or in the right of the  corporation
     in which the director was adjudged liable to the corporation; or

     (2) In connection  with any other  proceeding  charging  improper  personal
     benefit to him, whether or not involving  action in his official  capacity,
     in which he was  adjudged  liable on the basis that  personal  benefit  was
     improperly received by him.

(e) Indemnification permitted under this section in connection with a proceeding
by or in the  right  of the  corporation  that  is  concluded  without  a  final
adjudication  on the  issue of  liability  is  limited  to  reasonable  expenses
incurred in connection with the proceeding.

(f) The  authorization,  approval or  favorable  recommendation  by the board of
directors of a  corporation  of  indemnification,  as permitted by this section,
shall not be deemed an act or  corporate  transaction  in which a director has a
conflict of interest,  and no such indemnification  shall be void or voidable on
such ground.

ss. 55-8-52.  Mandatory Indemnification.

         Unless limited by its articles of  incorporation,  a corporation  shall
indemnify a director who was wholly successful,  on the merits or otherwise,  in
the  defense of any  proceeding  to which he was a party  because he is or was a
director  of the  corporation  against  reasonable  expenses  incurred by him in
connection with the proceeding.

ss. 55-8-53.  Advance For Expenses.

         Expenses  incurred by a director in defending a proceeding  may be paid
by the  corporation in advance of the final  disposition  of such  proceeding as
authorized  by the board of directors in the specific  case or as  authorized or
required  under any provision in the articles of  incorporation  or bylaws or by
any  applicable  resolution or contract upon receipt of an  undertaking by or on
behalf of the  director  to repay  such  amount  unless it shall  ultimately  be
determined that he is entitled to be indemnified by the corporation against such
expenses.

ss. 55-8-54.  Court-ordered indemnification.

         Unless a corporation's  articles of incorporation provide otherwise,  a
director  of the  corporation  who is a party  to a  proceeding  may  apply  for
indemnification to the court conducting


                                                             7

<PAGE>



the proceeding or to another court of competent  jurisdiction.  On receipt of an
application, the court after giving any notice the court considers necessary may
order indemnification if it determines:

     (1) The  director  is  entitled  to  mandatory  indemnification  under G.S.
     55-8-52,  in which case the court shall also order the  corporation  to pay
     the  director's   reasonable  expenses  incurred  to  obtain  court-ordered
     indemnification; or

     (2) The director is fairly and reasonably  entitled to  indemnification  in
     view of all the relevant circumstances,  whether or not he met the standard
     of conduct set forth in G.S. 55-8-51 or was adjudged liable as described in
     G.S.  55-8-51(d),  but if he was adjudged so liable his  indemnification is
     limited to reasonable expenses incurred.

ss. 55-8-55.  Determination and Authorization of Indemnification.

     (a) A corporation  may not indemnify a director  under G.S.  55-8-51 unless
     authorized  in the specific case after a  determination  has been made that
     indemnification of the director is permissible in the circumstances because
     he has met the standard of conduct set forth in G.S. 55- 8-51.

     (b) The determination shall be made:

          (1) By the board of directors by majority vote of a quorum  consisting
          of directors not at the time parties to the proceeding;

          (2) If a quorum cannot be obtained under  subdivision (1), by majority
          vote of a committee  duly  designated  by the board of  directors  (in
          which   designation   directors  who  are  parties  may  participate),
          consisting  solely of two or more directors not at the time parties to
          the proceeding;

          (3) By special legal counsel (i) selected by the board of directors or
          its committee in the manner  prescribed in subdivision  (1) or (2); or
          (ii) if a quorum of the board of  directors  cannot be obtained  under
          subdivision (1) and a committee cannot be designated under subdivision
          (2),  selected by  majority  vote of the full board of  directors  (in
          which selection directors who are parties may participate); or

          (4) By the  shareholders,  but  shares  owned  by or voted  under  the
          control of directors who are at the time parties to the proceeding may
          not be voted on the determination.

    (c)   Authorization   of   indemnification   and   evaluation   as  to
          reasonableness  of  expenses  shall be made in the same  manner as the
          determination that indemnification is permissible,


                                                             8

<PAGE>



except that if the determination is made by special legal counsel, authorization
of indemnification and evaluation as to reasonableness of expenses shall be made
by those entitled under subsection (b)(3) to select counsel.

ss. 55-8-56.  Indemnification Of Officers, Employees, and Agents.

               Unless  a  corporation's   articles  of   incorporation   provide
otherwise:

          (1)  An  officer  of  the   corporation   is  entitled  to   mandatory
          indemnification  under  G.S.  55-8-52,  and is  entitled  to apply for
          court-ordered  indemnification under G.S. 55-8-54, in each case to the
          same extent as a director.

          (2) The corporation may indemnify and advance expenses under this Part
          to an  officer,  employee,  or  agent of the  corporation  to the same
          extent as to a director; and

          (3) A  corporation  may also  indemnify  and  advance  expenses  to an
          officer,  employee,  or agent  who is not a  director  to the  extent,
          consistent with public policy, that may be provided by its articles of
          incorporation,  bylaws,  general  or  specific  action of its board of
          directors, or contract.

ss. 55-8-57.  Additional Indemnification and Insurance.

         (a) In  addition  to and  separate  and apart from the  indemnification
provided  for  in  G.S.  55-8-51,  55-8-52,  55-8-54,  55-8-55  and  55-8-56,  a
corporation  may in its  articles of  incorporation  or bylaws or by contract or
resolution  indemnify  or agree to indemnify  any one or more of its  directors,
officers,  employees, or agents against liability and expenses in any proceeding
(including  without  limitation  a  proceeding  brought  by or on  behalf of the
corporation  itself) arising out of their status as such or their  activities in
any of the foregoing capacities;  provided,  however, that a corporation may not
indemnify  or agree to indemnify a person  against  liability or expenses he may
incur  on  account  of his  activities  which  were at the time  taken  known or
believed  by him to be  clearly  in  conflict  with  the best  interests  of the
corporation.  A  corporation  may likewise  and to the same extent  indemnify or
agree to  indemnify a person who, at the request of the  corporation,  is or was
serving as a director,  officer,  partner,  trustee,  employee, agent of another
foreign or domestic  corporation,  partnership,  joint  venture,  trust or other
enterprise or as a trust or  administrator  under an employee  benefit plan. Any
provision in any  articles of  incorporation,  bylaw,  contract,  or  resolution
permitted  under this  section  may include  provisions  for  recovery  from the
corporation of reasonable  costs,  expenses,  and attorneys'  fees in connection
with the  enforcement  of  rights to  indemnification  granted  therein  and may
further include provisions  establishing  reasonable  procedures for determining
and enforcing the rights granted therein.



                                                             9

<PAGE>



         (b) The authorization,  adoption, approval, or favorable recommendation
by the  board of  directors  of a public  corporation  of any  provision  in any
articles of incorporation,  bylaw, contract or resolution,  as permitted in this
section, shall not be deemed an act or corporate transaction in which a director
has a conflict  of  interest,  and no such  articles of  incorporation  or bylaw
provision or contract or  resolution  shall be void or voidable on such grounds.
The authorization,  adoption, approval, or favorable recommendation by the board
of  directors  of a nonpublic  corporation  of any  provision in any articles of
incorporation,  bylaw,  contract or  resolution,  as permitted in this  section,
which  occurred  prior to July 1, 1990,  shall not be deemed an act or corporate
transaction in which a director has a conflict of interest, and no such articles
of incorporation, bylaw provision, contract or resolution shall be void voidable
on such grounds.  Except as permitted in G.S. 55-8-31, no such bylaw,  contract,
or  resolution  not adopted,  authorized,  approved or ratified by  shareholders
shall be  effective  as to  claims  made or  liabilities  asserted  against  any
director  prior to its  adoption,  authorization,  or  approval  by the board of
directors.

         (c) A corporation  may purchase and maintain  insurance on behalf of an
individual  who  is or  was a  director,  officer,  employee  or  agent  of  the
corporation,  or who,  while a  director,  officer,  employee,  or  agent of the
corporation,  is or was serving at the request of the corporation as a director,
officer,  partner,  trustee,  employee,  or agent of another foreign or domestic
corporation,  partnership, joint venture, trust, employee benefit plan, or other
enterprise,  against  liability  asserted  against  or  incurred  by him in that
capacity or arising  from his status as a direct  officer,  employee,  or agent,
whether or not the  corporation  would have power to  indemnify  him against the
same liability under any provision of this Chapter.

ss. 55-8-58.  Application of Part.

         (a) If articles of incorporation  limit  indemnification or advance for
expenses,  indemnification and advance for expenses are valid only to the extent
consistent with the articles.

         (b) This Part does not limit a corporation's  power to pay or reimburse
expenses  incurred by a director in connection  with his appearance as a witness
in a  proceeding  at a time  when  he has  not  been  made a name  defendant  or
respondent to the proceeding.

         (c) This Part shall not affect  rights or  liabilities  arising  out of
acts or omissions occurring before July 1, 1990.

Item 7.  Exemption from Registration Claimed.
         -----------------------------------
         Not Applicable.

Item 8.  Exhibits
         -------
         The Exhibits to this Form S-8 are listed in the  accompanying  Index to
Exhibits.


                                                            10

<PAGE>



Item 9.  Undertakings.
         ------------
         The undersigned Registrant hereby undertakes:

         (a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

          (i) To include  any  prospectus  required  by section  10(a)(3) of the
          Securities Act of 1933;

          (ii) To reflect in the  prospectus  any facts or events  arising after
          the effective date of the  Registration  Statement (or the most recent
          post-effective  amendment  thereof)  which,  individually  or  in  the
          aggregate, represent a fundamental change in the information set forth
          in the Registration Statement;

          (iii)To include any material  information  with respect to the plan of
          distribution not previously disclosed in the Registration Statement or
          any material change in such information in the Registration Statement.

               Provided,  however,  that  paragraphs  (1)(i) and  (1)(ii) do not
         apply if the  information  required to be included in a  post-effective
         amendment by those paragraphs is contained in periodic reports filed by
         the  Registrant  pursuant  to  section  13  or  section  15(d)  of  the
         Securities  Exchange Act of 1934 that are  incorporated by reference in
         the Registration Statement.

         That, for the purpose of determining any liability under the Securities
Act of 1933,  each  such  post-effective  amendment  shall be deemed to be a new
registration  statement  relating to the  securities  offered  therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

         (b) To remove from registration by means of a post-effective  amendment
any of the securities being registered which remain unsold at the termination of
the offering.

         The undersigned  Registrant hereby undertakes that, for the purposes of
determining  any liability  under the Securities Act of 1933, each filing of the
registrant's  annual  report  pursuant to Section  13(a) or Section 15(d) of the
Securities  Exchange  Act of 1934  (and,  where  applicable,  each  filing of an
employee  benefit  plan's  annual  report  pursuant  to  Section  15(d)  of  the
Securities  Exchange  Act of 1934)  that is  incorporated  by  reference  in the
Registration  Statement  shall  be  deemed  to be a new  registration  statement
relating to the securities offered therein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors,  officers and controlling  persons of
the Registrant pursuant to the foregoing


                                                            11

<PAGE>



provisions, or otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange  Commission such  indemnification  is against public
policy as expressed in the Act and is,  therefore,  unenforceable.  In the event
that a claim  for  indemnification  against  such  liabilities  (other  than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling  person of the Registrant in the  successful  defense of any action,
suit or proceeding) is asserted by such director,  officer or controlling person
in connection with the securities being registered,  the Registrant will, unless
in the  opinion  of its  counsel  the matter  has been  settled  by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

                                                        SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the City of Chapel Hill,  State of North  Carolina,  on July 30,
1998.

                                       KENAN TRANSPORT COMPANY


                                      By: /s/ Lee P. Shaffer
                                          ------------------
                                          Lee P. Shaffer
                                          President and Chief Executive Officer


               Pursuant to the  requirements of the Securities Act of 1933, this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the dates indicated.


Signature                     Title                                  Date
---------                     -----                                  ----

/s/ William L. Boone                                             July 27, 1998
----------------------       Vice President-Finance;
William L. Boone             Secretary; Treasurer
                           (Principal Financial Officer)

/s/ J. Earl Cowan             Controller                         July 27, 1998
----------------------        
J. Earl Cowan              (Principal Accounting Officer)

/s/ Thomas S. Kenan III     Chairman of the Board of             July 27, 1998
-------------------------   Directors
Thomas S. Kenan III 




                                                            12

<PAGE>



Signature                   Title                                Date
---------                   -----                                ----

/s/ Owen G. Kenan                                                July 27, 1998
------------------         Vice Chairman of the Board of
Owen G. Kenan              Directors

/s/ William O. McCoy       Director                              July 27, 1998
----------------------
William O. McCoy

/s/ Paul J. Rizzo          Director                              July 27, 1998
----------------------
Paul J. Rizzo

/s/ William C. Friday      Director                              July 27, 1998
----------------------
William C. Friday

/s/ Braxton Schell         Director                              July 27, 1998
---------------------
Braxton Schell

/s/ Kenneth G. Younger     Director                              July 27, 1998
---------------------
Kenneth G. Younger



                                                            13


<PAGE>

                                   EXHIBITS

                                   Index to Exhibits


Exhibit
  No.               Description
  ---               -----------


*4            Specimen  certificate of the Registrant's  common stock, filed as
              Exhibit 4(a) to the Registrant's Form 10 filed April 27, 1984.

5             Opinion of Schell Bray Aycock Abel & Livingston P.L.L.C.

23.1          Consent of Grant Thornton LLP.

23.2          Consent of Deloitte & Touche LLP.

23.3          Consent of Arthur Andersen LLP.

23.4          The consent of Schell Bray Aycock Abel & Livingston P.L.L.C. is 
               contained in its opinion filed as Exhibit 5.

*99(a)        1998  Long-Term  Incentive  Plan  filed  as  Appendix  I  to  the
               Registrant's Proxy Statement filed March 30, 1998.


*        Incorporated by reference to the statement or report indicated.
[{"type": "S-8", "sequence": "1", "description": "1998 LONG-TERM INCENTIVE PLAN", "secsgml_size_bytes": 36338}]
{"company-data": {"conformed-name": "KENAN TRANSPORT CO", "cik": "0000745379", "assigned-sic": "4213", "irs-number": "560516485", "state-of-incorporation": "NC", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-60213", "film-number": "98674389"}, "business-address": {"street1": "143 W FRANKLIN ST", "street2": "UNIVERSITY SQ WEST POST OFFICE BOX 2729", "city": "CHAPEL HILL", "state": "NC", "zip": "27516-3910", "phone": "9199678221"}, "mail-address": {"street1": "UNIVERSITY SQUARE WEST", "street2": "143 W FRANKLIN ST P O BOX 2729", "city": "CHAPEL HILL", "state": "NC", "zip": "27515-2729"}}
SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.
                                      20549

                                    FORM S-8
                          REGISTRATION STATEMENT UNDER
                           THE SECURITIES ACT OF 1933

                             KENAN TRANSPORT COMPANY
                             -----------------------
             (Exact name of registrant as specified in its charter)

   North Carolina                                               56-0516485
   -----------------------------------------------------------------------
(State or other jurisdiction                               (I.R.S. Employer
of incorporation or organization)                           Identification No.)

                 University Square-West, 143 W. Franklin Street
                     Chapel Hill, North Carolina 27516-3910
                     --------------------------------------
               (Address of Principal Executive Offices) (Zip Code)

                             KENAN TRANSPORT COMPANY
                          1998 LONG-TERM INCENTIVE PLAN
                          -----------------------------
                            (Full title of the plan)

                        WILLIAM L. BOONE, VICE PRESIDENT
                             Kenan Transport Company
                 University Square-West, 143 W. Franklin Street
                     Chapel Hill, North Carolina 27516-3910
                     --------------------------------------
                     (Name and address of agent for service)

                              (919) 967-8221
                              --------------
       (Telephone number, including area code, of agent for service)

                         CALCULATION OF REGISTRATION FEE

                                     Proposed        Proposed
Title of                             Maximum         Maximum
Securities                           Offering        Aggregate     Amount of
to be           Amount to be         Price           Offering      Registration
registered      Registered           Per Share*      Price*        Fee
-------------------------------------------------------------------------------

Common Stock    450,000 shares       $31.50          $14,175,000*  $4,181.63*
                                                      ----------    --------
no par value

*Pursuant  to Rule  457(h),  the average of the high and low price of the Common
Stock as reported on NASDAQ's  National  Market System on July 24, 1998 has been
used to calculate the amount of the registration fee.
This  Registration  Statement on Form S-8 covers  450,000 shares of the
Common Stock, no par value (the "Common Stock"), of Kenan Transport Company (the
"Registrant") issuable upon exercise of options,  exercise of stock appreciation
rights or grant of stock bonuses, in each case pursuant to the Registrant's 1998
Long-Term Incentive Plan (the "Plan").

                                              PART II

                        INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.
         ---------------------------------------
         The  Registrant  is subject to the  informational  requirements  of the
Securities  Exchange  Act of  1934  (the  "Exchange  Act"),  and  in  accordance
therewith files reports and other  information  with the Securities and Exchange
Commission. The following documents have previously been filed by the Registrant
with  the  Commission  and are  incorporated  herein  by  reference  as of their
respective dates:

  (a)  Annual Report on Form 10-K for the fiscal year ended December 31, 1997.

  (b)    (i)  Amendment to Current Report on Form 8-K/A dated
              February 12, 1998.

        (ii)  Current Report on Form 8-K dated March 13, 1998.

        (iii) Quarterly   Report  on  Form  10-Q  for  the
              quarter ended March 31, 1998.

        (iv)  Amendment to Current Report on Form 8-K/A dated
                                    May 13, 1998.

  (c)  The description of the Common Stock of the Registrant set forth under the
     heading  "Description of  Registrant's  Securities to be Registered" in the
     Registrant's  Form 10 (File No.  0-12058)  filed  with the  Securities  and
     Exchange Commission.

         All documents that are hereafter  filed by the  Registrant  pursuant to
Sections  13,  14 and  15(d)  of the  Exchange  Act,  prior to the  filing  of a
post-effective  amendment  which  indicates  that all shares of the Common Stock
issuable pursuant to the Plan have been issued or which

                                                             2
deregisters  any  shares  then  remaining  unissued,   shall  be  deemed  to  be
incorporated herein by reference and to be a part hereof from the date of filing
of such documents.

Item 4.           Description of Securities.
                  -------------------------
         Not Applicable.

Item 5.           Interests of Named Experts and Counsel.
                  ---------------------------------------
         Legal matters in connection  with the securities  registered  hereunder
are being passed upon for the Registrant by Schell Bray Aycock Abel & Livingston
P.L.L.C., Renaissance Plaza, 230 North Elm Street, Suite 1500, Greensboro, North
Carolina 27401.  Braxton Schell,  a partner of that firm, has been a director of
the Registrant since 1986.

Item 6.           Indemnification of Directors and Officers.
                  -----------------------------------------
         Article VIII of the Registrant's Bylaws provides:

                          ARTICLE VIII

                          Indemnification
                          ---------------

         1. Extent.  In addition to the  indemnification  otherwise  provided by
law,  the  corporation  shall  indemnify  and hold  harmless its  directors  and
officers  against  liability  and  litigation  expense,   including   reasonable
attorneys'  fees,  arising out of their status as directors or officers of their
activities in any of such  capacities or in any capacity in which any of them is
or  was  serving,  at  the  corporation's   request,  in  another   corporation,
partnership, joint venture, trust or other enterprise, and the corporation shall
indemnify  and hold  harmless  those  directors,  officers or  employees  of the
corporation  who are  deemed to be  fiduciaries  of the  corporation's  employee
pension and  welfare  benefit  plans as defined  under the  Employee  Retirement
Income  Security  Act of 1974,  as amended  ("ERISA  fiduciaries")  against  all
liability and litigation expense,  including reasonable attorneys' fees, arising
out of their status or activities as ERISA fiduciaries;  provided, however, that
the corporation  shall not indemnify a director or officer against  liability or
litigation  expense that he may incur on account of his  activities  that at the
time taken were known or reasonably  should have been known by him to be clearly
in conflict  with the best  interests of the  corporation,  and the  corporation
shall not  indemnify an ERISA  fiduciary  against any  liability  or  litigation
expense  that he may incur on account of his  activities  that at the time taken
were known or reasonably should have been known by him to be clearly in conflict
with the best  interests  of the employee  benefit plan to which the  activities
relate.  The corporation shall also indemnify the director,  officer,  and ERISA
fiduciary for reasonable costs,  expenses and attorneys' fees in connection with
the enforcement of rights to indemnification granted herein, if it is determined
in accordance with

                                                             3
Section 2 of this  Article  that the  director,  officer or ERISA  fiduciary  is
entitled to indemnification hereunder.

         2. Determination.  Any indemnification  under Section 1 of this Article
shall be paid by the corporation in any specific case only after a determination
that the director,  officer or ERISA  fiduciary did not act in a manner,  at the
time the activities  were taken,  that was known or reasonably  should have been
known  by  him  to be  clearly  in  conflict  with  the  best  interests  of the
corporation, or the employee benefit plan to which the activities relate, as the
case may be. Such  determination  shall be made (a) by the affirmative vote of a
majority  (but not less than two) of  directors  who are or were not  parties to
such  action,  suit or  proceeding  or against  whom any such claim is  asserted
("disinterested directors") even though less than a quorum, or (b) if a majority
(but not less than two) of  disinterested  directors so direct,  by  independent
legal  counsel  in a  written  opinion,  or (c)  if  there  are  less  than  two
disinterested directors, by the affirmative vote of all of the directors, or (d)
by the vote of a majority of all of the voting  shares other than those owned or
controlled by directors,  officers or ERISA fiduciaries who were parties to such
action,  suit or  proceeding  or against whom such claim is  asserted,  or by an
unanimous  vote of all of the  voting  shares,  or (e) by a court  of  competent
jurisdiction.

         3. Advanced Expenses. Expenses incurred by a director, officer or ERISA
fiduciary in defending a civil or criminal  claim,  action,  suit or  proceeding
may, upon  approval of a majority  (but not less than two) of the  disinterested
directors,  even  though  less  than a  quorum,  or,  if there are less than two
disinterested  directors,  upon unanimous approval of the Board of Directors, be
paid by the  corporation  in advance  of the final  disposition  of such  claim,
action, suit or proceeding upon receipt of an undertaking by or on behalf of the
director,  officer  or ERISA  fiduciary  to repay  such  amount  unless it shall
ultimately  be  determined  that he is entitled to be  indemnified  against such
expenses by the corporation.

         4. Corporation.  For purposes of this Article, references to directors,
officers or ERISA  fiduciaries of the  "corporation"  shall be deemed to include
directors,  officers  and ERISA  fiduciaries  of Kenan  Transport  Company,  its
subsidiaries,  and all  constituent  corporations  absorbed into Kenan Transport
Company or any of its subsidiaries by a consolidation or merger.

         5. Reliance and Consideration. Any director, officer or ERISA fiduciary
who at any time after the  adoption of this Bylaw serves or has served in any of
the aforesaid  capacities for or on behalf of the corporation shall be deemed to
be doing or to have done so in reliance  upon,  and as  consideration  for,  the
right of indemnification  provided herein. Such right shall inure to the benefit
of the legal  representatives  of any such person and shall not be  exclusive of
any other rights to which such person may be entitled  apart from the  provision
of this Bylaw.  No amendment,  modification or repeal of this Article VIII shall
adversely  affect  the right of any  director,  officer  or ERISA  fiduciary  to
indemnification  hereunder with respect to any activities occurring prior to the
time of such amendment, modification or repeal.

                                                             4
6. Insurance.  The  corporation may purchase and maintain  insurance on
behalf of its  directors,  officers,  employees and agents and those persons who
were serving at the request of the corporation as a director,  officer,  partner
or trustee of, or in some other capacity in, another  corporation,  partnership,
joint venture,  trust or other enterprise against any liability asserted against
him and  incurred by him in any such  capacity,  or arising out of his status as
such,  whether  or not the  corporation  would have the power to  indemnify  him
against such liability  under the  provisions of this Article or otherwise.  Any
full or partial payment made by an insurance  company under any insurance policy
covering  any  director,  officer,  employee  or agent made to or on behalf of a
person  entitled  to  indemnification  under  this  Article  shall  relieve  the
corporation of its liability for indemnification provided for in this Article or
otherwise to the extent of such  payment,  and no insurer  shall have a right of
subrogation against the corporation with respect to such payment.

         The North Carolina General Statutes contain provisions  prescribing the
extent  to which  directors  and  officers  shall or may be  indemnified.  These
statutory provisions are set forth below:

                           CH. 55 N.C. BUSINESS CORPORATION ACT

                           Part 5. Indemnification.

ss. 55-8-50.  Policy Statement and Definitions.

 (a)    It is the  public  policy  of this  State  to  enable  corporations
organized  under this  Chapter to attract and  maintain  responsible,  qualified
directors,  officers,  employees  and  agents,  and,  to  that  end,  to  permit
corporations  organized  under this  Chapter to  allocate  the risk of  personal
liability of directors,  officers,  employees and agents through indemnification
and insurance as authorized, in this Part.

 (b)   Definitions in this Part:

     (1)  "Corporation" includes any domestic or foreign predecessor entity of a
          corporation   in  a  merger   or  other   transaction   in  which  the
          predecessor's existence ceased upon consummation of the transaction.

     (2)  "Director"means   an  individual  who  is  or  was  a  director  of  a
          corporation  or an individual  who, while a director of a corporation,
          is or was serving at the corporation's request as a director, officer,
          partner,  trustee,  employee,  or agent of another foreign or domestic
          corporation, partnership, joint venture, trust, employee benefit plan,
          or other  enterprise.  A  director  is  considered  to be  serving  an
          employee  benefit plan at the  corporation's  request if his duties to
          the corporation  also impose duties on, or otherwise  involve services
          by, him to the

                                                             5
plan or to participants in or  beneficiaries of the plan.  "Director"  includes,
unless  the   context   requires   otherwise,   the   estate  or   personal
representative of a director.

     (3)  "Expenses"  means  expenses  of every kind  incurred  in  defending  a
          proceeding, including counsel fees.

     (4)  "Liability"  means  the  obligation  to  pay a  judgment,  settlement,
          penalty,  fine  (including  an excise tax assessed  with respect to an
          employee benefit plan), or reasonable  expenses  incurred with respect
          to a proceeding.

     (5)  "Official  capacity"  means: (i) when used with respect to a director,
          the  office  of  director  in a  corporation;  and (ii) when used with
          respect to an individual  other than a director,  as  contemplated  in
          G.S.  55-8-56,  the office in a corporation held by the officer or the
          employment or agency relationship  undertaken by the employee or agent
          on behalf of the  corporation.  "Official  capacity"  does not include
          service  for  another   foreign  or   domestic   corporation   or  any
          partnership,  joint venture,  trust,  employee  benefit plan, or other
          enterprise.

     (6)  "Party"  includes an  individual  who was, is, or is  threatened to be
          made a named defendant or respondent in a proceeding.

     (7)  "Proceeding" means any threatened, pending, or completed action, suit,
          or   proceeding,   whether   civil,   criminal,   administrative,   or
          investigative and whether formal or informal.

ss. 55-8-51.  Authority to Indemnify.

(a) Except as  provided  in  subsection  (d), a  corporation  may  indemnify  an
individual made a party to a proceeding  because he is or was a director against
liability incurred in the proceeding if:

               (1)  He conducted himself in good faith; and

               (2)  He  reasonably  believed  (i) in the case of  conduct in his
                    official capacity with the corporation, that his conduct was
                    in its best interests; and (ii) in all other cases, that his
                    conduct was at least not opposed to its best interests; and

               (3)  In the case of any criminal proceeding, he had no reasonable
                    cause to believe his conduct was unlawful.

(b) A director's  conduct with respect to an employee benefit plan for a purpose
he  reasonably  believed  to be in  the  interests  of the  participants  in and
beneficiaries  of  the  plan  is  conduct  that  satisfies  the  requirement  of
subsection (a)(2)(ii).

                                                             6
(c) The termination of a proceeding by judgment, order, settlement,  conviction,
or upon a plea of no contest or its equivalent is not, of itself,  determinative
that the  director  did not meet  the  standard  of  conduct  described  in this
section.

(d) A corporation may not indemnify a director under this section:

     (1) In connection  with a proceeding by or in the right of the  corporation
     in which the director was adjudged liable to the corporation; or

     (2) In connection  with any other  proceeding  charging  improper  personal
     benefit to him, whether or not involving  action in his official  capacity,
     in which he was  adjudged  liable on the basis that  personal  benefit  was
     improperly received by him.

(e) Indemnification permitted under this section in connection with a proceeding
by or in the  right  of the  corporation  that  is  concluded  without  a  final
adjudication  on the  issue of  liability  is  limited  to  reasonable  expenses
incurred in connection with the proceeding.

(f) The  authorization,  approval or  favorable  recommendation  by the board of
directors of a  corporation  of  indemnification,  as permitted by this section,
shall not be deemed an act or  corporate  transaction  in which a director has a
conflict of interest,  and no such indemnification  shall be void or voidable on
such ground.

ss. 55-8-52.  Mandatory Indemnification.

         Unless limited by its articles of  incorporation,  a corporation  shall
indemnify a director who was wholly successful,  on the merits or otherwise,  in
the  defense of any  proceeding  to which he was a party  because he is or was a
director  of the  corporation  against  reasonable  expenses  incurred by him in
connection with the proceeding.

ss. 55-8-53.  Advance For Expenses.

         Expenses  incurred by a director in defending a proceeding  may be paid
by the  corporation in advance of the final  disposition  of such  proceeding as
authorized  by the board of directors in the specific  case or as  authorized or
required  under any provision in the articles of  incorporation  or bylaws or by
any  applicable  resolution or contract upon receipt of an  undertaking by or on
behalf of the  director  to repay  such  amount  unless it shall  ultimately  be
determined that he is entitled to be indemnified by the corporation against such
expenses.

ss. 55-8-54.  Court-ordered indemnification.

         Unless a corporation's  articles of incorporation provide otherwise,  a
director  of the  corporation  who is a party  to a  proceeding  may  apply  for
indemnification to the court conducting

                                                             7
the proceeding or to another court of competent  jurisdiction.  On receipt of an
application, the court after giving any notice the court considers necessary may
order indemnification if it determines:

     (1) The  director  is  entitled  to  mandatory  indemnification  under G.S.
     55-8-52,  in which case the court shall also order the  corporation  to pay
     the  director's   reasonable  expenses  incurred  to  obtain  court-ordered
     indemnification; or

     (2) The director is fairly and reasonably  entitled to  indemnification  in
     view of all the relevant circumstances,  whether or not he met the standard
     of conduct set forth in G.S. 55-8-51 or was adjudged liable as described in
     G.S.  55-8-51(d),  but if he was adjudged so liable his  indemnification is
     limited to reasonable expenses incurred.

ss. 55-8-55.  Determination and Authorization of Indemnification.

     (a) A corporation  may not indemnify a director  under G.S.  55-8-51 unless
     authorized  in the specific case after a  determination  has been made that
     indemnification of the director is permissible in the circumstances because
     he has met the standard of conduct set forth in G.S. 55- 8-51.

     (b) The determination shall be made:

          (1) By the board of directors by majority vote of a quorum  consisting
          of directors not at the time parties to the proceeding;

          (2) If a quorum cannot be obtained under  subdivision (1), by majority
          vote of a committee  duly  designated  by the board of  directors  (in
          which   designation   directors  who  are  parties  may  participate),
          consisting  solely of two or more directors not at the time parties to
          the proceeding;

          (3) By special legal counsel (i) selected by the board of directors or
          its committee in the manner  prescribed in subdivision  (1) or (2); or
          (ii) if a quorum of the board of  directors  cannot be obtained  under
          subdivision (1) and a committee cannot be designated under subdivision
          (2),  selected by  majority  vote of the full board of  directors  (in
          which selection directors who are parties may participate); or

          (4) By the  shareholders,  but  shares  owned  by or voted  under  the
          control of directors who are at the time parties to the proceeding may
          not be voted on the determination.

    (c)   Authorization   of   indemnification   and   evaluation   as  to
          reasonableness  of  expenses  shall be made in the same  manner as the
          determination that indemnification is permissible,

                                                             8
except that if the determination is made by special legal counsel, authorization
of indemnification and evaluation as to reasonableness of expenses shall be made
by those entitled under subsection (b)(3) to select counsel.

ss. 55-8-56.  Indemnification Of Officers, Employees, and Agents.

               Unless  a  corporation's   articles  of   incorporation   provide
otherwise:

          (1)  An  officer  of  the   corporation   is  entitled  to   mandatory
          indemnification  under  G.S.  55-8-52,  and is  entitled  to apply for
          court-ordered  indemnification under G.S. 55-8-54, in each case to the
          same extent as a director.

          (2) The corporation may indemnify and advance expenses under this Part
          to an  officer,  employee,  or  agent of the  corporation  to the same
          extent as to a director; and

          (3) A  corporation  may also  indemnify  and  advance  expenses  to an
          officer,  employee,  or agent  who is not a  director  to the  extent,
          consistent with public policy, that may be provided by its articles of
          incorporation,  bylaws,  general  or  specific  action of its board of
          directors, or contract.

ss. 55-8-57.  Additional Indemnification and Insurance.

         (a) In  addition  to and  separate  and apart from the  indemnification
provided  for  in  G.S.  55-8-51,  55-8-52,  55-8-54,  55-8-55  and  55-8-56,  a
corporation  may in its  articles of  incorporation  or bylaws or by contract or
resolution  indemnify  or agree to indemnify  any one or more of its  directors,
officers,  employees, or agents against liability and expenses in any proceeding
(including  without  limitation  a  proceeding  brought  by or on  behalf of the
corporation  itself) arising out of their status as such or their  activities in
any of the foregoing capacities;  provided,  however, that a corporation may not
indemnify  or agree to indemnify a person  against  liability or expenses he may
incur  on  account  of his  activities  which  were at the time  taken  known or
believed  by him to be  clearly  in  conflict  with  the best  interests  of the
corporation.  A  corporation  may likewise  and to the same extent  indemnify or
agree to  indemnify a person who, at the request of the  corporation,  is or was
serving as a director,  officer,  partner,  trustee,  employee, agent of another
foreign or domestic  corporation,  partnership,  joint  venture,  trust or other
enterprise or as a trust or  administrator  under an employee  benefit plan. Any
provision in any  articles of  incorporation,  bylaw,  contract,  or  resolution
permitted  under this  section  may include  provisions  for  recovery  from the
corporation of reasonable  costs,  expenses,  and attorneys'  fees in connection
with the  enforcement  of  rights to  indemnification  granted  therein  and may
further include provisions  establishing  reasonable  procedures for determining
and enforcing the rights granted therein.

                                                             9
(b) The authorization,  adoption, approval, or favorable recommendation
by the  board of  directors  of a public  corporation  of any  provision  in any
articles of incorporation,  bylaw, contract or resolution,  as permitted in this
section, shall not be deemed an act or corporate transaction in which a director
has a conflict  of  interest,  and no such  articles of  incorporation  or bylaw
provision or contract or  resolution  shall be void or voidable on such grounds.
The authorization,  adoption, approval, or favorable recommendation by the board
of  directors  of a nonpublic  corporation  of any  provision in any articles of
incorporation,  bylaw,  contract or  resolution,  as permitted in this  section,
which  occurred  prior to July 1, 1990,  shall not be deemed an act or corporate
transaction in which a director has a conflict of interest, and no such articles
of incorporation, bylaw provision, contract or resolution shall be void voidable
on such grounds.  Except as permitted in G.S. 55-8-31, no such bylaw,  contract,
or  resolution  not adopted,  authorized,  approved or ratified by  shareholders
shall be  effective  as to  claims  made or  liabilities  asserted  against  any
director  prior to its  adoption,  authorization,  or  approval  by the board of
directors.

         (c) A corporation  may purchase and maintain  insurance on behalf of an
individual  who  is or  was a  director,  officer,  employee  or  agent  of  the
corporation,  or who,  while a  director,  officer,  employee,  or  agent of the
corporation,  is or was serving at the request of the corporation as a director,
officer,  partner,  trustee,  employee,  or agent of another foreign or domestic
corporation,  partnership, joint venture, trust, employee benefit plan, or other
enterprise,  against  liability  asserted  against  or  incurred  by him in that
capacity or arising  from his status as a direct  officer,  employee,  or agent,
whether or not the  corporation  would have power to  indemnify  him against the
same liability under any provision of this Chapter.

ss. 55-8-58.  Application of Part.

         (a) If articles of incorporation  limit  indemnification or advance for
expenses,  indemnification and advance for expenses are valid only to the extent
consistent with the articles.

         (b) This Part does not limit a corporation's  power to pay or reimburse
expenses  incurred by a director in connection  with his appearance as a witness
in a  proceeding  at a time  when  he has  not  been  made a name  defendant  or
respondent to the proceeding.

         (c) This Part shall not affect  rights or  liabilities  arising  out of
acts or omissions occurring before July 1, 1990.

Item 7.  Exemption from Registration Claimed.
         -----------------------------------
         Not Applicable.

Item 8.  Exhibits
         -------
         The Exhibits to this Form S-8 are listed in the  accompanying  Index to
Exhibits.

                                                            10
Item 9.  Undertakings.
         ------------
         The undersigned Registrant hereby undertakes:

         (a) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

          (i) To include  any  prospectus  required  by section  10(a)(3) of the
          Securities Act of 1933;

          (ii) To reflect in the  prospectus  any facts or events  arising after
          the effective date of the  Registration  Statement (or the most recent
          post-effective  amendment  thereof)  which,  individually  or  in  the
          aggregate, represent a fundamental change in the information set forth
          in the Registration Statement;

          (iii)To include any material  information  with respect to the plan of
          distribution not previously disclosed in the Registration Statement or
          any material change in such information in the Registration Statement.

               Provided,  however,  that  paragraphs  (1)(i) and  (1)(ii) do not
         apply if the  information  required to be included in a  post-effective
         amendment by those paragraphs is contained in periodic reports filed by
         the  Registrant  pursuant  to  section  13  or  section  15(d)  of  the
         Securities  Exchange Act of 1934 that are  incorporated by reference in
         the Registration Statement.

         That, for the purpose of determining any liability under the Securities
Act of 1933,  each  such  post-effective  amendment  shall be deemed to be a new
registration  statement  relating to the  securities  offered  therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

         (b) To remove from registration by means of a post-effective  amendment
any of the securities being registered which remain unsold at the termination of
the offering.

         The undersigned  Registrant hereby undertakes that, for the purposes of
determining  any liability  under the Securities Act of 1933, each filing of the
registrant's  annual  report  pursuant to Section  13(a) or Section 15(d) of the
Securities  Exchange  Act of 1934  (and,  where  applicable,  each  filing of an
employee  benefit  plan's  annual  report  pursuant  to  Section  15(d)  of  the
Securities  Exchange  Act of 1934)  that is  incorporated  by  reference  in the
Registration  Statement  shall  be  deemed  to be a new  registration  statement
relating to the securities offered therein,  and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

         Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors,  officers and controlling  persons of
the Registrant pursuant to the foregoing

                                                            11
provisions, or otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange  Commission such  indemnification  is against public
policy as expressed in the Act and is,  therefore,  unenforceable.  In the event
that a claim  for  indemnification  against  such  liabilities  (other  than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling  person of the Registrant in the  successful  defense of any action,
suit or proceeding) is asserted by such director,  officer or controlling person
in connection with the securities being registered,  the Registrant will, unless
in the  opinion  of its  counsel  the matter  has been  settled  by  controlling
precedent,  submit to a court of appropriate  jurisdiction  the question whether
such  indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.

                                                        SIGNATURES

         Pursuant  to the  requirements  of the  Securities  Act  of  1933,  the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the City of Chapel Hill,  State of North  Carolina,  on July 30,
1998.

                                       KENAN TRANSPORT COMPANY

                                      By: /s/ Lee P. Shaffer
                                          ------------------
                                          Lee P. Shaffer
                                          President and Chief Executive Officer

               Pursuant to the  requirements of the Securities Act of 1933, this
registration  statement  has  been  signed  by  the  following  persons  in  the
capacities and on the dates indicated.

Signature                     Title                                  Date
---------                     -----                                  ----

/s/ William L. Boone                                             July 27, 1998
----------------------       Vice President-Finance;
William L. Boone             Secretary; Treasurer
                           (Principal Financial Officer)

/s/ J. Earl Cowan             Controller                         July 27, 1998
----------------------        
J. Earl Cowan              (Principal Accounting Officer)

/s/ Thomas S. Kenan III     Chairman of the Board of             July 27, 1998
-------------------------   Directors
Thomas S. Kenan III 

                                                            12
Signature                   Title                                Date
---------                   -----                                ----

/s/ Owen G. Kenan                                                July 27, 1998
------------------         Vice Chairman of the Board of
Owen G. Kenan              Directors

/s/ William O. McCoy       Director                              July 27, 1998
----------------------
William O. McCoy

/s/ Paul J. Rizzo          Director                              July 27, 1998
----------------------
Paul J. Rizzo

/s/ William C. Friday      Director                              July 27, 1998
----------------------
William C. Friday

/s/ Braxton Schell         Director                              July 27, 1998
---------------------
Braxton Schell

/s/ Kenneth G. Younger     Director                              July 27, 1998
---------------------
Kenneth G. Younger

                                                            13
EXHIBITS

                                   Index to Exhibits

Exhibit
  No.               Description
  ---               -----------

*4            Specimen  certificate of the Registrant's  common stock, filed as
              Exhibit 4(a) to the Registrant's Form 10 filed April 27, 1984.

5             Opinion of Schell Bray Aycock Abel & Livingston P.L.L.C.

23.1          Consent of Grant Thornton LLP.

23.2          Consent of Deloitte & Touche LLP.

23.3          Consent of Arthur Andersen LLP.

23.4          The consent of Schell Bray Aycock Abel & Livingston P.L.L.C. is 
               contained in its opinion filed as Exhibit 5.

*99(a)        1998  Long-Term  Incentive  Plan  filed  as  Appendix  I  to  the
               Registrant's Proxy Statement filed March 30, 1998.

*        Incorporated by reference to the statement or report indicated.