20211217Final_Order_No_35261.pdf

ORDER NO. 35261 1
Office of the Secretary
Service Date
December 17, 2021
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF INTERMOUNTAIN
GAS COMPANY’S APPLICATION FOR
AUTHORITY TO ISSUE AND SELL
SECURITIES
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CASE NO. INT-G-21-07

ORDER NO. 35261

On November 23, 2021, Intermountain Gas Company (“Company”), a subsidiary of
MDU Resources Group, Inc., applied to the Commission for authority to issue unsecured notes,
not to exceed $50,000,000 under Idaho Code §§ 6l-901, et seq. Having fully considered the
Company’s Application and Staff’s recommendation, the Commission enters this Order
authorizing the Company to issue up to $50,000,000 in unsecured notes.
THE APPLICATION
The Company requests authority to issue and sell up to $50,000,000 of unsecured debt
securities. The proposed issuance will be directly placed in one or more tranches with one or more
private placement investors. The Company anticipates one or more tranches with proposed
maturity dates ranging from ten years to forty years from the date of issuance. The interest rate
will be set at the time of issuance based on 10-year Treasury rates plus a credit spread of
approximately 100-170 for any 10-year or 15-year issuance and based on 30-year Treasury rates
plus a credit spread of approximately 145-200 for any 30-year or 40-year issuance. Credit spreads
are subject to change. The Company says it will use net proceeds from the sale of the unsecured
notes to refinance existing debt, fund capital expenditures and for general corporate purposes.
The Company anticipates agent and legal fees necessary to complete the securities
issuance to total up to $325,000, which will leave estimated net proceeds of up to $49,675,000 if
all authorized securities are issued.
STAFF REVIEW AND RECOMMENDATION
Staff believed the Company’s Application for proposed securities issuance met the
requirements of Idaho Code § 61-901. Staff recommended the Commission grant the Company
authority to issue up to $50,000,000 in debt. Staff noted the current interest rates are attractive.
Staff also recommended the Commission require the Company to file with the Commission the
ORDER NO. 35261 2
loan documents showing the amount borrowed and all other terms of the loan within seven days
of those documents being available.
Finally, Staff recommended the Commission order the Company to file quarterly
reports identifying the date of issuance, principal amount, interest rate, date of maturity and
identity of payee.
COMMISSION FINDINGS AND DISCUSSION
The Company is an Idaho corporation with its office and principal place of business in
Boise, Idaho. It is a natural gas public utility that owns and operates transmission pipelines,
liquefied natural gas storage facilities, compressor stations, distribution mains, services, meters
and regulators, and general plant and equipment. It is a gas corporation and public utility as defined
in Idaho Code §§ 61-117 and 61-129.
The Commission has jurisdiction over the Application under Idaho Code § 61-901, et
seq. We find that the proposed issuance is in the public interest and a formal hearing on this matter
is not required. We further find that the proposed issuance is for a lawful purpose and is within the
Company's corporate powers, that the Application conforms to Rules 141 through 150 of the
Commission's Rules of Procedure, IDAPA 31.01.01-141-150, and that the Company has paid all
fees due under Idaho Code § 61-905. Accordingly, we find that the Application should be
approved, and the proposed financing should be allowed.
The Commission’s Order approving the proposed financing and the general purposes
to which the proceeds may be put is not a determination that the Commission approves of the
particular use to which these funds will be put. This Order also is not a Commission determination
or approval of the type of financing or the related costs for ratemaking purposes. The Commission
does not have before it for determination, and so does not determine, the effect of the proposed
transaction on rates the Company will charge for natural gas service.
O R D E R
IT IS HEREBY ORDERED that the Company’s Application to issue and sell up to
$50,000,000 of unsecured notes with proposed maturity dates from ten (10) to forty (40) years is
granted.
IT IS FURTHER ORDERED that the Company must continue to file quarterly reports
with the Commission setting forth the date of issuance, principal amount, interest rate, date of
ORDER NO. 35261 3
maturity, and identity of payee for all promissory notes issued during the quarter. The Company
must continue to file its capitalization ratios with the quarterly reports.
IT IS FURTHER ORDERED that the foregoing authorization is without prejudice to the
regulatory authority of the Commission with respect to rates, utility capital structure, service
accounts, valuation, estimates for determination of cost or any other matter which may come before
this Commission pursuant to its jurisdiction and authority as provided by law.
IT IS FURTHER ORDERED that nothing in this Order and no provisions of Chapter 9,
Title 61, Idaho Code, or any act or deed done or performed in connection therewith shall be construed
to obligate the State of Idaho to pay or guarantee in any manner whatsoever any security authorized,
issued, assumed, or guaranteed under the provisions of Chapter 9, Title 61, Idaho Code.
IT IS FURTHER ORDERED that issuance of this Order does not constitute acceptance
of the Company’s exhibits or other material accompanying the Application for any purpose other
than the issuance of this Order.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7)
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.
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ORDER NO. 35261 4

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 17th day
of December 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

Jan Noriyuki
Commission Secretary

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