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In a Dutch oven or soup kettle, cook bacon over medium heat until crisp. Using a slotted spoon, remove bacon to paper towels; drain, reserving drippings. Add onion and celery to drippings. Saute until vegetables are tender; drain. Add the peas, water, potatoes, ham, salt, bay leaf and pepper. Bring to a boil. Reduce heat; cover and simmer for 45 minutes or until peas are very tender, stirring occasionally. Discard bay leaf.
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