**EXHIBIT12**

 

**CASCADE NATURAL GAS CORPORATION**

**COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES**

**AND PREFERRED DIVIDEND REQUIREMENTS**

 
| ** **                                                              | ** ** | **Twelve Months Ended**    | ** ** |
|-------------------------------------------------------------------------|------------|----------------------------|------------|
| ** **                                                              | ** ** | **31-Mar-05**              | ** ** | **30-Sep-04** | ** ** | **30-Sep-03** | ** ** | **30-Sep-02** | ** ** | **30-Sep-01** | ** ** | **30-Sep-00** | ** ** |
| ** **                                                              | ** ** | **(dollars in thousands)** | ** ** |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Fixed  charges, as defined:                                             |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                                        |       | $                          | 11,986     |   | $ | 12,375 |   | $ | 12,363 |   | $ | 12,384 |   | $ | 10,509 |   | $ | 10,936 |   |
| Amortization of debt issuance expense                                   |       | 467                        |       | 618 |   | 696 |   | 652 |   | 607 |   | 607 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Total fixed charges                                                     |       | $                          | 12,453     |   | $ | 12,993 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,543 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings, as defined:                                                   |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Net income                                                              |       | $                          | 10,713     |   | $ | 13,302 |   | $ | 9,104 |   | $ | 10,762 |   | $ | 17,236 |   | $ | 15,374 |   |
| Add (deduct):                                                           |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Income taxes                                                            |       | 6,204                      |       | 7,559 |   | 4,733 |   | 5,781 |   | 9,278 |   | 9,051 |   |
| Fixed charges                                                           |       | 12,453                     |       | 12,993 |   | 13,059 |   | 13,036 |   | 11,116 |   | 11,543 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Total earnings                                                          |       | $                          | 29,370     |   | $ | 33,854 |   | $ | 26,896 |   | $ | 29,579 |   | $ | 37,630 |   | $ | 35,968 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Ratio of earnings to fixed charges                                      |       | 2.36                       |       | 2.61 |   | 2.06 |   | 2.27 |   | 3.39 |   | 3.12 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Fixed charges and preferred dividend  requirements:                     |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Fixed charges                                                           |       | $                          | 12,453     |   | $ | 12,993 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,543 |   |
| Preferred dividend requirements                                         |       | —                     |       | — |   | — |   | — |   | — |   | 6 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Total                                                                   |       | $                          | 12,453     |   | $ | 12,993 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,549 |   |
|                                                                    |       |                       |       |   |   |   |   |   |   |   |   |   |   |
| Ratio of earnings to fixed charges and preferred  dividend requirements |       | 2.36                       |       | 2.61 |   | 2.06 |   | 2.27 |   | 3.39 |   | 3.12 |   |

 

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