Commission Approves NW Natural Deal to Develop Natural Gas Fields
April 28, 2011
UM 1520/UG 204
Salem, OR. The Oregon Public Utility Commission (OPUC) cleared the way for NW Natural to enter into a joint venture to develop gas fields in Wyoming with a subsidiary of Calgary-based Encana Corporation.
The decision approved a settlement reached between NW Natural, Commission staff, the Citizens’ Utility Board (CUB) and Northwest Industrial Gas Users (NWIGU).
Under the terms of the venture, NW Natural will invest $251 million over five years in return for natural gas for its customers over the next 30 years. NW Natural, Commission staff, Citizens’ Utility Board, and NWIGU agreed the transaction offers likely customer benefits of price savings and natural gas price stability over the term of the agreement. NW Natural expects to receive enough natural gas from the fields during the first ten years to meet 8-10 percent of the gas it needs each year to serve its customers.
The cost of the natural gas from the Wyoming gas fields will flow through to customers this fall when the Commission makes its once a year adjustment to reflect changes in the wholesale price of natural gas paid by natural gas companies in Oregon.
As part of the agreement, NW Natural agrees to file a general rate case by the end of the year. It has been nine years since NW Natural has filed a general rate case. The Commission also directed the company to file ongoing reports with the Commission regarding the venture.
Link to Commission order: