In 1984, Tulsa gas-pipeline operator Williams Cos. was scouting for a way to squeeze a few bucks from abandoned pipelines. It seized on the idea of threading fiber-optic cables through the pipelines and leasing capacity to newcomers then challenging AT&T in long-distance phone services. The idea spawned WilTel Network Services, a business sold to what is now WorldCom Inc., 10 years later for a staggering $2.5 billion.

For a time, it looked as though the telecom foray would end up a colorful chapter in the history of a $4.4 billion energy empire. No more. Williams is returning to the communications business--and this time, it will sell wholesale capacity for carrying voice and data. The company plans to double the size of its nationwide network to 22,000 miles by late 1999. It has already won $1 billion in contracts with U S West Communications Group and Intermedia Communications, a Tampa telecom company.

Still, Tulsa's good ol' boys will face tough competition from newcomers such as Qwest Communications International. Williams' strategy is to strike alliances with utility giants already reselling Williams natural gas and electricity, such as Nevada Electric Co.

Williams has another ace up its sleeve: Last year, the company struck a partnership with Northern Telecom Ltd. to sell voice- and data-switching equipment to corporations. The venture, managed by former NorTel exec Garry K. McGuire, already boasts such customers as Bankers Trust New York Corp. ''The good news is that demand for bandwidth is growing exponentially,'' says McGuire. Last year, the communications group saw a loss of $55 million on $1.4 billion in revenues, but Prudential Securities Inc.'s M. Carol Coale says it should reach $85 million in operating profits next year. Call it the Tulsa two-step: You move full circle and wind up back in the same place.

By Gary McWilliams in Houston