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DUFF & PHELPS RATES NORTHWEST NATURAL GAS COMPANY'S MEDIUM-TERM NOTE PROGRAM

 CHICAGO, July 2 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned ratings to Northwest Natural Gas Company's new medium-term note program. The secured medium-term notes have been rated "A" (Single-A), and the unsecured portion "A-" (Single-A-Minus). The company recently sold $35 million of secured medium-term notes from the shelf in order to redeem higher coupon first mortgage bonds. Approximately $115 million of debt securities remain available for sale, proceeds from which may be used for additional refunding and for construction.
 Northwest Natural Gas has a relatively balanced capital structure, strengthened by common equity and preference stock sales in 1992. Financial measures are expected to improve from weather-influenced levels of 1992, aided by strong customer growth and continued cost containment. Non-utility operations have had a modest negative impact on earnings and cash flows. Future capital requirements of non-utility activities are being limited to the amount of funds internally generated by these subsidiaries. Importantly, the company is not expected to experience further financial impact upon final resolution of matters involving its subsidiary Agrico.
 New construction and conversions from alternative fuels have contributed to above average customer growth. A low saturation of space heating provides substantial potential for continued customer and throughput volume growth. Northwest Natural also may benefit from fuel-switching stimulated by new regional energy policies and needs. Competition is strong in the company's industrial markets where users have alternative fuel capability or can choose to bypass the company's system. Northwest Natural has implemented special rates and undertaken other measures in order to mitigate the competitive threat.
 Northwest Natural's good storage capabilities and access to Rocky Mountain and Canadian gas suppliers position the company well for the changing industry environment under FERC Order 636. The company already purchases a significant portion of its supplies directly from producers. About two-thirds of gas supplies is derived from Canadian sources. Northwest Natural's supply position will be further enhanced as it begins to receive gas from Alberta, Canada.
 Northwest Natural Gas serves over 355,000 customers in northwest Oregon and southwest Washington. The company also has non-utility operations including natural gas exploration, development, marketing and transportation; real estate management; and financial investments. These subsidiaries comprise about 12 percent of total company assets.
 -0- 7/2/93
 /CONTACT: David W. Eisinger of Duff & Phelps Credit Rating Co., 312-368-3145/
 (NWNG)


CO: Northwest Natural Gas Company ST: Washington IN: UTI SU: RTG

LG -- NY031 -- 8225 07/02/93 15:05 EDT
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Publication:PR Newswire
Date:Jul 2, 1993
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