Pacific Northern Gas Ltd.
TSX : PNG
TSX : PNG.PR.A

Pacific Northern Gas Ltd.

September 12, 2005 20:19 ET

Pacific Northern Gas Ltd. Announces Conditional Approval from the British Columbia Utilities Commission to Convert to an Income Trust

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 13, 2005) - Pacific Northern Gas Ltd. ("PNG") (TSX:PNG)(TSX:PNG.PR.A) announced today that it has received conditional approval from the British Columbia Utilities Commission (the "Commission") to convert to an income trust ownership structure.

Roy Dyce, President and CEO of PNG said, "We are pleased that the Commission has recognized that PNG is not earning a fair return under the current regulatory structure and that there can be mutual benefits for both customers and shareholders under the income trust structure. However there are a number of significant conditions placed upon the approval, including a reduction in the interest rate on subordinated debt as applied for by the Company that would, on its own, have the effect of reducing cash flow to the income trust by approximately $0.9 million annually. These conditions and their implications must be carefully considered before determining if we will pursue the next steps in the conversion process."

In the coming weeks PNG will be determining whether to proceed with the conversion process and will be advising its customers and shareholders of its intentions at that time. In addition to the approval granted by the Commission, the approval of the shareholders of PNG, court approval, a provincial Order in Council, consent of the existing bondholders and acceptable market conditions will also be necessary for the conversion to proceed. No assurances can be given by PNG that the required approvals will be obtained, or that the change to an income trust will occur.

The full text of the Commission's decision can be found under the investor relations section of the Company's website at www.png.ca.

Headquartered in Vancouver, British Columbia, Pacific Northern Gas Ltd. (TSX:PNG)(TSX:PNG.PR.A) owns and operates natural gas transmission and distribution systems. The Company's western transmission line extends from the Duke Energy Gas Transmission system north of Prince George to tidewater at Kitimat and Prince Rupert, and provides service to 12 communities and a number of industrial facilities. In the northeast, PNG's subsidiary Pacific Northern Gas (N.E.) Ltd. provides gas distribution service in the Dawson Creek, Fort St. John and Tumbler Ridge areas.

Contact Information

  • Pacific Northern Gas Ltd. - Investor Inquiries
    Elizabeth Fletcher
    Chief Financial Officer
    (604) 691-5684
    or
    Pacific Northern Gas Ltd. - Media Inquiries
    Greg Weeres P.Eng.
    Vice President Operations & Engineering
    (604) 691-5680
    www.png.ca