Pacific Northern Gas Ltd.

Pacific Northern Gas Ltd.

October 28, 2005 19:16 ET

PNG Announces Approval of its Application for Reconsideration of the Commission's September 9, 2005 Income Trust Conversion Decision

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Oct. 28, 2005) - Pacific Northern Gas Ltd. (PNG) (TSX:PNG)(TSX:PNG.PR.A) announced today that it has received approval from the British Columbia Utilities Commission ("Commission") of its application for reconsideration of the Commission's September 9, 2005 decision.

The Commission's reconsideration results in the interest rates on the subordinate notes to be issued by PNG to the PNG Income Trust being approved at 12 percent on the fixed rate notes and 5.75 percent above long Canada bonds on the variable-rate notes. The approved interest rates are the same as those set forth in PNG's original application.

Although the approval by the Commission of the reconsideration application is an important factor in the determination of whether the Company will convert to an income trust, there are additional matters which will need to be resolved before PNG proceeds with the conversion. These include resolution of the regulatory and associated financial impacts of the termination by Methanex Corporation of its Firm and Interruptible Gas Transportation Service Agreement with PNG effective February 28, 2006 and the uncertainty created by the Canadian federal government's launch in September 2005 of a consultation process on income trusts.

In addition, the approval of the shareholders of PNG, court approval, a provincial Order in Council and consent of the existing bondholders 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.

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
    Pacific Northern Gas Ltd. - Media Inquiries
    Greg Weeres P.Eng.
    Vice President Operations & Engineering
    (604) 691-5680