NORTHWEST NATURAL GAS COMPANY
LONG TERM INCENTIVE PLAN

1.    Purpose. The purpose of this Long Term Incentive Plan (the “Plan”) is to
enable Northwest Natural Gas Company (the “Company”) to attract and retain the
services of selected employees, officers and directors of the Company or of any
subsidiary of the Company.

2.    Shares Subject to the Plan. Subject to adjustment as provided below and in
Section 9, the shares to be offered under the Plan shall consist of Common Stock
of the Company, and the total number of shares of Common Stock that may be
awarded under the Plan shall not exceed 1,100,000 shares. The shares awarded
under the Plan may be authorized and unissued shares, reacquired shares or
shares purchased on the open market for delivery to participants. If an option,
Stock Award or Performance-based Award granted under the Plan expires,
terminates or is cancelled, the shares subject to such option, Stock Award or
Performance-based Award shall again be available under the Plan. If any shares
delivered pursuant to a Stock Award or Performance-based Award under the Plan
are forfeited to the Company, the number of shares forfeited shall again be
available under the Plan.

3.    Duration of Plan. The Plan shall continue in effect until all shares
available for award under the Plan have been delivered to participants and all
restrictions on such shares have lapsed; provided, however, that no awards shall
be made under the Plan on or after the 10th anniversary of the last action by
the shareholders approving or re-approving the Plan. The Board of Directors may
suspend or terminate the Plan at any time except with respect to awards and
shares subject to restrictions then outstanding under the Plan. Termination
shall not affect any outstanding awards or the forfeitability of shares awarded
under the Plan.

4.    Administration.

(a)    Board of Directors. The Plan shall be administered by the Board of
Directors of the Company, which shall determine and designate from time to time
the individuals to whom awards shall be made, the amount of the awards and the
other terms and conditions of the awards. Subject to the provisions of the Plan,
the Board of Directors may from time to time adopt and amend rules and
regulations relating to administration of the Plan, advance the lapse of any
waiting period, accelerate any exercise date, waive or modify any restriction
applicable to shares (except those restrictions imposed by law) and make all
other determinations in the judgment of the Board of Directors necessary or
desirable for the administration of the Plan. The interpretation and
construction of the provisions of the Plan and related agreements by the Board
of Directors shall be final and conclusive. The Board of Directors may correct
any defect or supply any omission or reconcile any inconsistency in the Plan or
in any related agreement in the manner and to the extent it shall deem expedient
to carry the Plan into effect, and it shall be the sole and final judge of such
expediency.

(b)    Committee. The Board of Directors may delegate to a committee of the
Board of Directors (the “Committee”) any or all authority for administration of
the Plan. If authority is delegated to a Committee, all references to the Board
of Directors in the Plan shall mean and relate to the Committee except (i) as
otherwise provided by the Board of Directors, and (ii) that only the Board of
Directors may amend or terminate the Plan as provided in Sections 3 and 10.

(c)    No Dividends on Unvested Awards. No award granted under the Plan shall
provide for the payment of dividends on shares subject to the award before the
shares have Vested; provided, however, that dividends accumulated between the
grant date of an award and the Vesting date on shares that become Vested under
the award may be paid to the recipient at or after the time the shares become
Vested. “Vested”

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means that shares have been delivered to the recipient and are no longer subject
to a substantial risk of forfeiture (as defined in regulations under Section 83
of the Internal Revenue Code of 1986, as amended (“IRC”).

(d)    Minimum Service Period. No award granted under the Plan on or after
January 1, 2017 shall become Vested if the recipient does not remain in the
service of the Company until the first anniversary of the date of grant, unless
the recipient’s service is terminated as a result of the recipient’s death or
physical disability (within the meaning of Section 22(e)(3) of the IRC), or such
earlier Vesting occurs as a result of a Change in Control of the Company;
provided, however, that the foregoing prohibition shall not apply to five
percent of the sum of the number of shares available for awards under the Plan
on January 1, 2017 plus the number of additional shares that thereafter become
available.

(e)    Change in Control Vesting. No award granted under the Plan on or after
January 1, 2017 shall provide for any excuse from satisfaction of the continued
service conditions of the award as a result of a Change in Control of the
Company, except that an award agreement may excuse the recipient from the
continued service obligation if:

(i)    the recipient’s employment is terminated by the employer without cause or
by the recipient for good reason in connection with the Change in Control under
terms specified in the award agreement; or

(ii)    the award is not converted into an award for stock of the surviving or
acquiring corporation in the Change in Control transaction under terms specified
in the award agreement.

(f)    Change in Control Definition. For purposes of the Plan, a “Change in
Control” of the Company shall mean the occurrence of any of the following
events:

(i)    The consummation of:

(1)    any consolidation, merger or plan of share exchange involving the Company
(a “Merger”) as a result of which the holders of outstanding securities of the
Company ordinarily having the right to vote for the election of directors
(“Voting Securities”) immediately prior to the Merger do not continue to hold at
least 50% of the combined voting power of the outstanding Voting Securities of
the surviving corporation or a parent corporation of the surviving corporation
immediately after the Merger, disregarding any Voting Securities issued to or
retained by such holders in respect of securities of any other party to the
Merger; or
(2)    any sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all, or substantially all, the assets of the
Company;
(ii)    At any time during a period of two consecutive years, individuals who at
the beginning of such period constituted the Board (“Incumbent Directors”) shall
cease for any reason to constitute at least a majority thereof; provided,
however, that the term “Incumbent Director” shall also include each new director
elected during such two-year period whose nomination or election was approved by
two-thirds of the Incumbent Directors then in office; or
(iii)    Any person (as such term is used in Section 14(d) of the Securities
Exchange Act of 1934, other than the Company or any employee benefit plan
sponsored by the Company) shall, as a result of a tender or exchange offer, open
market purchases or privately negotiated purchases from anyone

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other than the Company, have become the beneficial owner (within the meaning of
Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly,
of Voting Securities representing twenty percent (20%) or more of the combined
voting power of the then outstanding Voting Securities.
5.    Types of Awards; Eligibility. The Board of Directors may, from time to
time, take the following actions, separately or in combination, under the Plan:
(i) grant Stock Awards, including restricted stock and restricted stock units,
as provided in Section 6; (ii) grant stock options as provided in Section 7; and
(iii) grant Performance-based Awards as provided in Section 8. An award may be
made to any employee, officer or director of the Company or any subsidiary of
the Company, except that no stock option or Performance-based Award may be
granted to any director who is not also an employee of the Company. The Board of
Directors shall select the individuals to whom awards shall be made and shall
specify the action taken with respect to each individual to whom an award is
made.

6.    Stock Awards, including Restricted Stock and Restricted Stock Units. The
Board of Directors may grant shares as stock awards under the Plan (“Stock
Awards”). No director of the Company who is not also an employee of the Company
may be granted Stock Awards in any fiscal year for more than $300,000 in fair
market value (as defined in Section 7(c)) of Common Stock. Stock Awards shall be
subject to the terms, conditions and restrictions determined by the Board of
Directors. The restrictions may include restrictions concerning transferability
and forfeiture of the shares awarded, together with any other restrictions
determined by the Board of Directors. Stock Awards subject to restrictions may
be either restricted stock awards under which shares are delivered immediately
upon grant subject to forfeiture if vesting conditions are not satisfied, or
restricted stock unit awards under which shares are not delivered until after
vesting conditions are satisfied. The Board of Directors may require the
recipient to sign an agreement as a condition of the award, but may not require
the recipient to pay any monetary consideration other than amounts necessary to
satisfy tax withholding requirements. The agreement may contain any terms,
conditions, restrictions, representations and warranties required by the Board
of Directors. The certificates representing the shares awarded shall bear any
legends required by the Board of Directors. The Company may require any
recipient of a Stock Award to pay to the Company in cash or by check upon demand
amounts necessary to satisfy any applicable federal, state or local tax
withholding requirements. If the recipient fails to pay the amount demanded, the
Company may withhold that amount from other amounts payable to the recipient,
including salary, subject to applicable law. With the consent of the Board of
Directors, a recipient may satisfy this obligation, in whole or in part, by
instructing the Company to withhold from any shares to be received or by
delivering to the Company other shares of Common Stock; provided, however, that
the number of shares so withheld or delivered shall not exceed the minimum
amount necessary to satisfy the required tax withholding obligation. Upon the
delivery of shares under a Stock Award, the number of shares reserved for award
under the Plan shall be reduced by the number of shares delivered, less the
number of shares withheld or delivered to satisfy tax withholding obligations;
provided, however, that effective for shares delivered on and after January 1,
2017, the adjustment for shares withheld or delivered to satisfy tax withholding
obligations shall no longer apply.
    
7.    Stock Options.

(a)    Option Grants. Options granted under the Plan may be Incentive Stock
Options as defined in Section 422 of the IRC, or Non‑Statutory Stock Options. A
Non‑Statutory Stock Option means an option other than an Incentive Stock Option.
The Board of Directors has the sole discretion to determine which options shall
be Incentive Stock Options and which options shall be Non‑Statutory Stock
Options, and, at the time of grant, it shall specifically designate each option
granted under the Plan as an Incentive Stock Option or a Non‑Statutory Stock
Option. In the case of Incentive Stock Options, all terms shall be consistent
with the requirements of the IRC and applicable regulations. No Incentive Stock
Option may be

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granted under the Plan on or after the tenth anniversary of the last action by
the Board of Directors approving an increase in the number of shares available
for issuance under the Plan, which action was subsequently approved within 12
months by the shareholders.

(b)    Limitation on Amount of Grants. No employee may be granted options under
the Plan for more than 200,000 shares of Common Stock in any fiscal year.

(c)    Option Price. The option price per share under each option granted under
the Plan shall be determined by the Board of Directors, but the option price for
an Incentive Stock Option and a Non‑Statutory Stock Option shall be not less
than 100 percent of the fair market value of the shares covered by the option on
the date the option is granted. Except as otherwise expressly provided, for
purposes of the Plan, the fair market value shall be deemed to be the closing
sales price for the Common Stock as reported by the New York Stock Exchange and
published in the Wall Street Journal for the date of grant, or such other fair
market value of the Common Stock as determined by the Board of Directors of the
Company.

(d)    Duration of Options. Each option granted under the Plan shall continue in
effect for the period fixed by the Board of Directors, except that no Incentive
Stock Option shall be exercisable after the expiration of 10 years from the date
it is granted and no Non‑Statutory Stock Option shall be exercisable after the
expiration of 10 years plus seven days from the date it is granted.

(e)    Nonassignability. Except as otherwise provided by the Board of Directors,
each option granted under the Plan by its terms shall be nonassignable and
nontransferable by the optionee except by will or by the laws of descent and
distribution of the state or country of the optionee’s domicile at the time of
death, and each option by its terms shall be exercisable during the optionee’s
lifetime only by the optionee.

(f)    Option Agreements. The Board of Directors shall determine the employees
to whom options shall be granted and the number of shares, option price, the
period of each option, the time or times at which options may be exercised, and
any other term of the grant, all of which shall be set forth in an option
agreement between the Company and the optionee.

(g)    Effect on Shares Available. Upon the exercise of an option, the number of
shares available for issuance under the Plan shall be reduced by the number of
shares for which the option was exercised, without any adjustment for shares
surrendered in payment of the option price or surrendered or withheld to satisfy
tax withholding requirements.

(h)    No Repricing. Except for actions approved by the shareholders of the
Company or adjustments made pursuant to Section 9, the option price for an
outstanding option granted under the Plan may not be decreased after the date of
grant nor may the Company grant a new option or pay any cash or other
consideration (including another award under the Plan) in exchange for any
outstanding option granted under the Plan at a time when the option price of the
outstanding option exceeds the fair market value of the shares covered by the
option.

8.    Performance-based Awards. The Board of Directors may grant awards intended
to qualify as qualified performance-based compensation under Section 162(m) of
the IRC and the regulations thereunder (“Performance-based Awards”).
Performance-based Awards shall be denominated at the time of grant either in
Common Stock (“Stock Performance Awards”) or in dollar amounts (“Dollar
Performance Awards”). Payment under a Stock Performance Award or a Dollar
Performance Award shall be made, at the

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discretion of the Board of Directors, in Common Stock (“Performance Shares”), or
in cash or in any combination thereof. Performance-based Awards shall be subject
to the following terms and conditions:

(a)    Award Period. The Board of Directors shall determine the period of time
for which a Performance-based Award is made (the “Award Period”).

(b)    Performance Goals and Payment. The Board of Directors shall establish in
writing objectives (“Performance Goals”) that must be met by the Company or any
subsidiary, division or other unit of the Company (“Business Unit”) during the
Award Period as a condition to payment being made under the Performance-based
Award. The Performance Goals for each award shall be one or more targeted levels
of performance with respect to one or more of the following objective measures
with respect to the Company or any Business Unit: earnings, earnings per share,
stock price increase, total shareholder return (stock price increase plus
dividends), return on equity, return on assets, return on capital, economic
value added, revenues, operating income, inventories, inventory turns, cash
flows or any of the foregoing before the effect of acquisitions, divestitures,
accounting changes, and restructuring and special charges (determined according
to criteria established by the Board of Directors). The Board of Directors shall
also establish the number of Performance Shares or the amount of cash payment to
be made under a Performance-based Award if the Performance Goals are met or
exceeded, including the fixing of a maximum payment (subject to Section 8(d)).
The Board of Directors may establish other restrictions to payment under a
Performance-based Award, such as a continued employment requirement, in addition
to satisfaction of the Performance Goals. Some or all of the Performance Shares
may be delivered to the participant at the time of the award as restricted
shares subject to forfeiture in whole or in part if Performance Goals or, if
applicable, other restrictions are not satisfied.

(c)    Computation of Payment. During or after an Award Period, the performance
of the Company or Business Unit, as applicable, during the period shall be
measured against the Performance Goals. If the Performance Goals are not met, no
payment shall be made under a Performance-based Award. If the Performance Goals
are met or exceeded, the Board of Directors shall certify that fact in writing
and certify the number of Performance Shares earned or the amount of cash
payment to be made under the terms of the Performance-based Award.

(d)    Maximum Awards. No participant may receive in any fiscal year Stock
Performance Awards under which the aggregate amount payable under the Awards
exceeds the equivalent of 50,000 shares of Common Stock or Dollar Performance
Awards under which the aggregate amount payable under the Awards exceeds
$1,000,000.

(e)    Tax Withholding. Each participant who has received Performance Shares
shall, upon notification of the amount due, pay to the Company in cash or by
check amounts necessary to satisfy any applicable federal, state and local tax
withholding requirements. If the participant fails to pay the amount demanded,
the Company or the Employer may withhold that amount from other amounts payable
to the participant, including salary, subject to applicable law. With the
consent of the Board of Directors, a participant may satisfy this obligation, in
whole or in part, by instructing the Company to withhold from any shares to be
received or by delivering to the Company other shares of Common Stock; provided,
however, that the number of shares so delivered or withheld shall not exceed the
minimum amount necessary to satisfy the required tax withholding obligation.

(f)    Effect on Shares Available. The payment of a Performance-based Award in
cash shall not reduce the number of shares of Common Stock reserved for award
under the Plan. The number of shares of Common Stock reserved for award under
the Plan shall be reduced by the number of shares delivered

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to the participant upon payment of an award, less the number of shares delivered
or withheld to satisfy tax withholding obligations; provided, however, that
effective for shares delivered on and after January 1, 2017, the adjustment for
shares withheld or delivered to satisfy tax withholding obligations shall no
longer apply.

9.    Changes in Capital Structure. If the outstanding Common Stock of the
Company is hereafter increased or decreased or changed into or exchanged for a
different number or kind of shares or other securities of the Company by reason
of any stock split, combination of shares or dividend payable in shares,
recapitalization or reclassification, appropriate adjustment shall be made by
the Board of Directors in the number and kind of shares available for grants
under the Plan. In addition, the Board of Directors shall make appropriate
adjustment in the number and kind of shares subject to outstanding awards, and
in the exercise price of outstanding options, so that the recipient’s
proportionate interest before and after the occurrence of the event is
maintained. Notwithstanding the foregoing, the Board of Directors shall have no
obligation to effect any adjustment that would or might result in the award of
fractional shares, and any fractional shares resulting from any adjustment may
be disregarded or provided for in any manner determined by the Board of
Directors. Any such adjustments made by the Board of Directors shall be
conclusive.

10.    Amendment of Plan. The Board of Directors may at any time, and from time
to time, modify or amend the Plan in such respects as it shall deem advisable
because of changes in the law while the Plan is in effect or for any other
reason. Except as provided in Section 9, however, no change in an award already
granted shall be made without the written consent of the holder of such award.

11.    Approvals. The issuance by the Company of authorized and unissued shares
or reacquired shares under the Plan is subject to the approval of the Oregon
Public Utility Commission and the Washington Utilities and Transportation
Commission, but no such approvals shall be required for the purchase of shares
on the open market for delivery to participants in satisfaction of awards under
the Plan. The obligations of the Company under the Plan are otherwise subject to
the approval of state and federal authorities or agencies with jurisdiction in
the matter. The Company will use its best efforts to take steps required by
state or federal law or applicable regulations, including rules and regulations
of the Securities and Exchange Commission and any stock exchange on which the
Company’s shares may then be listed, in connection with the grants under the
Plan. The foregoing notwithstanding, the Company shall not be obligated to issue
or deliver Common Stock under the Plan if such issuance or delivery would
violate applicable state or federal securities laws.

12.    Employment and Service Rights. Nothing in the Plan or any award pursuant
to the Plan shall (i) confer upon any employee any right to be continued in the
employment of the Company or any subsidiary or interfere in any way with the
right of the Company or any subsidiary by whom such employee is employed to
terminate such employee’s employment at any time, for any reason, with or
without cause, or to decrease such employee’s compensation or benefits, or
(ii) confer upon any person engaged by the Company any right to be retained or
employed by the Company or to the continuation, extension, renewal, or
modification of any compensation, contract, or arrangement with or by the
Company.

13.    Rights as a Shareholder. The recipient of any award under the Plan shall
have no rights as a shareholder with respect to any Common Stock until the date
the recipient becomes the holder of record of those shares. Except as otherwise
expressly provided in the Plan, no adjustment shall be made for dividends or
other rights for which the record date occurs prior to the date the recipient
becomes the holder of record.

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