**EXHIBIT 12**

 

**CASCADE NATURAL GAS CORPORATION**

**COMPUTATION OF RATIO OF EARNINGS TO FIXEDCHARGES**

**AND PREFERRED DIVIDEND REQUIREMENTS**

 
|                                                                    |   | **Twelve  Months Ended**    |   |
|-------------------------------------------------------------------------|--------|-----------------------------|--------|
|                                                                    |   | **31-Mar-04**               |   | **30-Sep-03** |   | **30-Sep-02** |   | **30-Sep-01** |   | **30-Sep-00** |   | **30-Sep-99** |   |
|                                                                    |   | **(dollars  in thousands)** |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Fixed charges, as defined:                                              |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Interest expense                                                        |   | $                           | 12,478 |   | $ | 12,363 |   | $ | 12,384 |   | $ | 10,509 |   | $ | 10,936 |   | $ | 10,486 |   |
| Amortization of debt issuance expense                                   |   | 696                         |   | 696 |   | 652 |   | 607 |   | 607 |   | 603 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Total fixed charges                                                     |   | $                           | 13,174 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,543 |   | $ | 11,089 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Earnings, as defined:                                                   |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                              |   | $                           | 11,989 |   | $ | 9,104 |   | $ | 10,762 |   | $ | 17,236 |   | $ | 15,374 |   | $ | 14,053 |   |
| Add (deduct):                                                           |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes                                                            |   | 6,392                       |   | 4,733 |   | 5,781 |   | 9,278 |   | 9,051 |   | 8,075 |   |
| Fixed charges                                                           |   | 13,174                      |   | 13,059 |   | 13,036 |   | 11,116 |   | 11,543 |   | 11,089 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Total earnings                                                          |   | $                           | 31,555 |   | $ | 26,896 |   | $ | 29,579 |   | $ | 37,630 |   | $ | 35,968 |   | $ | 33,217 |   |
| Ratio of earnings to fixed charges                                      |   | 2.40                        |   | 2.06 |   | 2.27 |   | 3.39 |   | 3.12 |   | 3.00 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Fixed charges and preferred dividend  requirements:                     |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Fixed charges                                                           |   | $                           | 13,174 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,543 |   | $ | 11,089 |   |
| Preferred dividend requirements                                         |   | —                      |   | — |   | — |   | — |   | 6 |   | 756 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Total                                                                   |   | $                           | 13,174 |   | $ | 13,059 |   | $ | 13,036 |   | $ | 11,116 |   | $ | 11,549 |   | $ | 11,845 |   |
|                                                                    |   |                        |   |   |   |   |   |   |   |   |   |   |   |
| Ratio of earnings to fixed charges and  preferred dividend requirements |   | 2.40                        |   | 2.06 |   | 2.27 |   | 3.39 |   | 3.12 |   | 2.80 |   |

 

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