Good morning, and welcome to the Northwest Natural Gas First Quarter Results Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions]. Please note this event is being recorded. I would now like to turn the conference over to Nikki Sparley. Please go ahead.

Thank you, Kate. Good morning, everyone, and welcome to our first quarter 2015 earnings call. This is Nikki Sparley and I’m temporarily filling in Bob Hess who is unable to be with us today. As a reminder, some of the things that will be said this morning contain forward-looking statements. They are based on management’s assumptions, which may or may not come true, and you should refer to the language at the end of our press release for the appropriate cautionary statements and also our SEC filings for additional information. We expect to file our 10-Q later today. As mentioned, this teleconference is being recorded and will be available on our website following the call. Please note that these conference calls are designed for the financial community. If you are an individual investor and have questions, please contact me directly at 503-226-4211 extension 58 or 57. Media may contact, Melissa Moore at 503-220-2436. Speaking this morning are Gregg Kantor, President and Chief Executive Officer and Steve Feltz, Senior Vice President and Chief Financial Officer. Gregg and Steve have some opening remarks and then will be available to answer your questions. Also joining us today are other members of our executive team, who are available to help answer any questions that you may have. We look forward to seeing many of you at the upcoming AGA financial forum this month. If you have any questions about the event, please contact me. With that, let me turn it over to Gregg for his opening remarks.

Good morning, everyone and welcome to our first quarter earnings call. I’m going to begin today with highlights from the quarter and then turn it over to Steve to cover the financial details for the period, and then I’ll wrap up with brief comments about our priorities for the remainder of the year. As you know, over the past few years, we’ve been working through several complex regulatory proceedings that came out of our 2012 Oregon rate case. In the first quarter, we received the Oregon Commission’s decision on our environmental cost recovery docket which lays out how an earnings test will be applied to environmental expenditures we incurred and will continue to incur in the future. In this order, the Commission found that all but $33,000 of the $114 million of environmental expenses incurred through March of 2014 recruitment. The order also found that the insurance settlements resulting in the collection of about a $150 million were entered into prudently. However, the OPUC disallowed recovery of environmental expenses totaling $15 million incurred through 2012 due to the application of an earnings test and other considerations. As a result, we took a one-time after tax charge in the quarter of $9.1 million. While the write-down was disappointing, we view our ability to fully recover future environmental cleanup costs as the key issue in a very complicated docket. We were also glad to have the environmental spend and insurance settlements being prudent. Steve will cover the mechanics of the order in a moment but overall, we view this outcome as a reasonable resolution and we’re pleased to have this docket behind us. Also in the quarter, on another holdover issue from our 2012 rate case, the Oregon Commission directed the parties engaged in our interstate storage sharing proceeding, to select a…

Thank you, Gregg and good morning everyone. Earnings for the first quarter of 2015 were $1.04 per share, a net income of $28.5 million as compared to $1.40 per share and $37.9 million for the same period of last year. As Gregg pointed out, results for the current quarter include a onetime $15 million charge to O&M expense for the right after deferred environmental costs ordered by the OPUC. Net charge decreased earnings by $9.1 million or $0.33 per share; excluding the charge quarterly earnings were $1.37 per share, a net income of $37.6 million or roughly on par with last year as utility earnings were up $0.04 per share while gas storage was down $0.06 per share. Our utility reported net income of $28.3 million in the first quarter or a decrease of $7.7 million from last year, driven by the write-down of environmental cost. The utility also reported other O&M expense increases but those were more than offset by an increase in other income, a decrease in interest expense and slightly higher margin revenues. In fact, margins at the utility increased despite this being the warmest first quarter on record in our service territory. From January to March, average temperatures were 22% warmer than a year ago and 20% warmer than normal. As a result, total gas deliveries by the utility were down 19% and gross revenues were down 10%. In spite of the large decline in volumes and gross revenues, margins increased $300,000, mostly due to customer growth; added returns from rate based investments in gas reserves and pipeline integrity; and gains from incentive-sharing on gas cost savings, all of which more than offset the negative impact of weather from customers in Oregon and Washington that were not covered by weather normalization and the coupling mechanism. In…

Thanks Steve. From a regulatory perspective, the first quarter was clearly a busy one. As you know, last year we submitted our integrated resource plan to Oregon and Washington regulators and in the period we received acknowledgement of the IRP from both commissions. The plan encompasses a wide range of issues associated with our ability to meet customer needs and it identifies several important areas for future investments. For example, fast growing Clark County, Washington will require several gas infrastructure investments to serve new homes and businesses; and the company will need to modernize its Newport LNG plant which was originally built in 1977. The expected investment is around $20 million. Plan also identified several uncertainties around the future demands on our region’s gas infrastructure. Today regulators and investors are considering a variety of energy project proposals, ranging from new pipelines, to LNG export facilities, to large industrial expansions. At this point, we don’t know the outcome of those projects but how they play out will determine which regional pipeline investment makes the most sense. In the mean time, we are continuing to work with TransCanada to make sure that Trail west pipeline project which was formerly the Palomar project remains an option for the region in the years ahead. Over the last several months, we’ve been working with key stakeholders on several project proposals under our new carbon solutions program. As I mentioned in the past, our carbon solutions program is an opportunity made possible by Oregon legislation. It allows the OPUC to incent natural gas utilities to undertake projects that will reduce greenhouse gas emissions. The firs proposal we hope to file with the commission is designed to further the use of combined heat power in Oregon, a goal the state has had for many years. Under our…

We will now begin the question-and-answer session. [Operator Instructions]. The first question comes from Winfried Fruehauf of W Fruehauf Consulting Limited Consulting Limited. Please go ahead.

Regarding environmental expenditures going forward, your press statements says that you will be allowed to recover prudently incurred expenses. Does that mean that you have to go back to the Commission and obtain approval in order to know what was prudently incurred?

Yes, that’s correct. On new expenditures that were not covered by the previous ruling, we’ll have to make sure that they go through a process with the Commission that after they’ve been spent that they were in fact prudently incurred.

Okay.

And that will be done on an annual basis.

And regarding your gas storage income, you have a past contract expired in the ‘13-’14 gas year. Why do you expect lower prices in the next 12 months?

We’re not expecting lower prices in next 12 months. There is a gas storage contracting period, usually starts every April 1. A year ago, there were headwinds in the market, primarily there was a lack of storage because after the cold winter there have been a lot of drawn storage. And so the front end of the curve was higher. This year we started to see a more normal forward curve with lower prices, the front end of it. So, we’re not expecting to see lower prices than a year ago. In fact we’ve seen a little bit of an increase, a modest increase in prices this year but nowhere near what we had seen a years ago when prices were lower.

[Operator Instructions].

It doesn’t look like we’ve got any other questions. I know we’re going to see many of you down Palm Springs here in the couple of weeks, looking forward to that. And again if you have questions about that event, feel free to call Nikki and looking forward to it. Enjoy the rest of your day.

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.