News Release
October 09, 2003


VANCOUVER, BRITISH COLUMBIA – Pacific Northern Gas Ltd. (PNG) announces that its principal shareholder, Duke Energy, has entered into an agreement to sell its 40 percent interest in PNG to Tricor Acquisition (STP) Inc. a subsidiary of Tricor Pacific Capital, Inc. (Tricor).  Tricor is acquiring the shares as nominee for Tricor Pacific Capital Partners (Fund III), Limited Partnership, a British Columbia based private equity fund. 

The completion of the sale is subject to certain conditions including the receipt of required regulatory and other approvals. Duke Energy through its Westcoast Energy Inc. business unit, owns 1,420,200 Class A non-voting and all of the 20,000 Class B voting common shares of PNG.  Before the sale is completed, all of the issued Class A and B shares of PNG will be redesignated as a single class of common shares with one vote per share. Subject to regulatory approval, the single class of common shares will trade on The Toronto Stock Exchange in place of the Class A non-voting shares.

Roy Dyce, President and CEO of PNG said, “The conversion of the Class A and B shares into a single class of common voting shares is a significant benefit to the Company’s existing public shareholders.  Also, the investment by Tricor indicates a strong belief in the ability of PNG’s management to enhance shareholder value.  PNG looks forward to working with Tricor in continuing to provide a high degree of secure and reliable service to PNG’s customers.” 

The Company also announced today it has been considering options to enhance shareholder values and is contemplating the conversion of PNG to an income trust structure.  Any conversion would require the approval of the British Columbia Utilities Commission, as well as approval by the shareholders of PNG.  Once the Company has completed its analysis of the possible conversion to an income trust, it will file an application with the Commission for the required approval.  In addition, a conversion to an income fund would require court approval, approval of other regulatory and governmental bodies, and acceptable market conditions.  No assurances can be given by PNG that the required approvals will be obtained, or that the conversion to an income fund will occur.

Rod Senft, Tricor’s Managing Director said, “Tricor is excited about having an interest in a natural gas utility.  It fits with our strategy of investing in companies with strong earnings, good business fundamentals and a capable management team who have invested with us in the enterprise.  Tricor is highly supportive of PNG’s consideration of its strategic alternatives, including the potential conversion to an income trust.”

As part of the transaction, senior management of PNG will acquire shares of PNG from Tricor (representing approximately 2.8 % of the issued shares of PNG) on the same terms as Tricor acquires the shares from Duke Energy.

Scotia Capital Inc. advised PNG on the strategic aspects of this transaction and will continue to assist the Company in the evaluation of options to enhance shareholder value.

Headquartered in Vancouver, British Columbia, Pacific Northern Gas Ltd. (TSX:PNG.A/ 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 (formerly Westcoast Energy) 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, Pacific Northern’s subsidiary Pacific Northern Gas (N.E.) Ltd. provides gas distribution service in the Dawson Creek, Fort St. John and Tumbler Ridge areas.

Contact: Greg Weeres, Pacific Northern Gas
Phone: 604/691-5680
24-Hour Phone: n/a
Contact: Elizabeth Fletcher, Pacific Northern Gas
Phone: 604/691-5680
24-Hour Phone: n/