  We present the analysis of a Chandra High-Energy Transmission Grating (HETG)
observation of the local Seyfert galaxy NGC 1365. The source, well known for
its dramatic X-ray spectral variability, was caught in a reflection-dominated,
Compton-thick state. The high spatial resolution afforded by Chandra allowed us
to isolate the soft X-ray emission from the active nucleus, neglecting most of
the contribution from the kpc-scale starburst ring. The HETG spectra thus
revealed a wealth of He- and H-like lines from photoionized gas, whereas in
larger aperture observations these are almost exclusively produced through
collisional ionization in the circumnuclear environment. Once the residual
thermal component is accounted for, the emission-line properties of the
photoionized region close to the hard X-ray continuum source indicate that NGC
1365 has some similarities to the local population of obscured active galaxies.
In spite of the limited overall data quality, several soft X-ray lines seem to
have fairly broad profiles (~800-1300 km/s full-width at half maximum), and a
range of outflow velocities (up to ~1600 km/s, but possibly reaching a few
thousands km/s) appears to be involved. At higher energies, the K$\alpha$
fluorescence line from neutral iron is resolved with > 99 per cent confidence,
and its width of ~3000 km/s points to an origin from the same broad-line region
clouds responsible for eclipsing the X-ray source and likely shielding the
narrow-line region.
