Questar Gas Company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

[X]

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter ended September 30, 2007

[ ]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ___

Commission File Number 1-935

QUESTAR GAS COMPANY

(Exact name of registrant as specified in charter)

STATE OF UTAH

87-0155877

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

Identification No.)

180 East 100 South Street, P.O. Box 45360 Salt Lake City, Utah 84145-0360
(Address of principal executive offices)

Registrant’s telephone number, including area code (801) 324-5111

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

On October 31, 2007, 9,189,626 shares of the registrant’s common stock, $2.50 par value, were outstanding (all shares are owned by Questar Corporation).

Registrant meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is filing this Form 10-Q with the reduced disclosure format.

Questar Gas Company

Form 10-Q for the Quarter Ended September 30, 2007

TABLE OF CONTENTS

Page

PART I.

FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS (Unaudited)

Statements of Income for the three, nine and twelve months ended

September 30, 2007 and 2006

Condensed Balance Sheets as of September 30, 2007, September 30, 2006

and December 31, 2006

Condensed Statements of Cash Flows for the nine months ended

September 30, 2007 and 2006

Notes Accompanying the Condensed Financial Statements

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION

AND RESULTS OF OPERATIONS

ITEM 4T.

CONTROLS AND PROCEDURES

PART II.

OTHER INFORMATION

Questar Gas 2007 Form 10-Q

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.


QUESTAR GAS COMPANY
STATEMENTS OF INCOME
(Unaudited)
	3 Months Ended Sept. 30,		9 Months Ended Sept. 30,		12 Months Ended Sept. 30,
	2007	2006	2007	2006	2007	2006
	(in millions)
REVENUES
From unaffiliated customers	$ 92.7	$ 99.0	$640.9	$747.8	$952.2	$1,099.9
From affiliated companies	1.2	1.7	4.4	4.5	5.4	6.2
Total Revenues	93.9	100.7	645.3	752.3	957.6	1,106.1

OPERATING EXPENSES
Cost of natural gas sold	62.6	72.7	475.0	581.8	715.0	857.0
Operating and maintenance	18.3	16.7	55.6	55.1	73.7	75.0
General and administrative	9.5	10.1	32.1	30.5	43.5	39.3
Depreciation and amortization	9.7	8.9	28.8	31.1	38.6	42.8
Other taxes	3.5	3.5	10.7	10.8	11.5	11.9
Total Operating Expenses	103.6	111.9	602.2	709.3	882.3	1,026.0
Net (loss) from asset sales				(0.3)		(0.3)
OPERATING INCOME (LOSS)	(9.7)	(11.2)	43.1	42.7	75.3	79.8
Interest and other income	1.6	1.8	5.6	4.8	7.4	6.1
Interest expense	(5.8)	(5.5)	(17.7)	(16.4)	(23.9)	(21.8)
INCOME (LOSS) BEFORE INCOME TAXES	(13.9)	(14.9)	31.0	31.1	58.8	64.1
Income taxes	(5.4)	(5.7)	11.5	11.6	21.8	24.0
NET INCOME (LOSS)	($ 8.5)	($ 9.2)	$ 19.5	$ 19.5	$ 37.0	$ 40.1

See notes accompanying the condensed financial statements


QUESTAR GAS COMPANY
CONDENSED BALANCE SHEETS
	Sept. 30,			Dec. 31,
	2007	2006		2006
	(Unaudited)
	(in millions)
ASSETS
Current Assets
Cash and cash equivalents				$ 3.6
Note receivable from Questar			$ 13.3
Accounts receivable, net	$ 32.9		36.4	83.3
Unbilled-gas accounts receivable	10.8		13.9	67.5
Accounts receivable from affiliates	2.1		2.5	2.1
Gas stored underground	52.8		60.9	50.2
Materials and supplies	9.9		8.0	7.8
Prepaid expenses and other	1.2		0.9	2.1
Deferred income taxes – current	1.7		1.0	1.7
Total Current Assets	111.4		136.9	218.3
Property, Plant and Equipment	1,496.3		1,388.8	1,418.1
Accumulated depreciation and amortization	(620.4)		(593.8)	(598.0)
Net Property, Plant and Equipment	875.9		795.0	820.1
Regulatory assets	29.7		23.8	23.0
Goodwill	5.6		5.6	5.6
Other noncurrent assets	6.2		6.4	6.3
Total Assets	$1,028.8		$ 967.7	$1,073.3

LIABILITIES AND COMMON SHAREHOLDER’S EQUITY
Current Liabilities
Checks outstanding in excess of cash	$ 2.8		$ 1.2
Notes payable to Questar	19.7			$ 13.2
Accounts and other payables	62.2		53.4	131.1
Accounts payable to affiliates	28.2		33.9	32.6
Customer-credit balances	37.0		32.4	31.4
Fair value of derivative contracts			6.8	7.6
Purchased-gas adjustment	46.6		28.7	34.3
Current portion of long-term debt	53.0			10.0
Total Current Liabilities	249.5		156.4	260.2
Long-term debt, less current portion	270.0		323.0	313.0
Deferred income taxes	121.3		121.0	118.7
Other long-term liabilities	58.7		48.7	51.8
COMMON SHAREHOLDER’S EQUITY
Common stock	23.0		23.0	23.0
Additional paid-in capital	116.5		115.9	116.0
Retained earnings	189.8		179.7	190.6
Total Common Shareholder’s Equity	329.3		318.6	329.6
Total Liabilities and Common Shareholder’s Equity	$1,028.8		$ 967.7	$1,073.3

See notes accompanying the condensed financial statements


QUESTAR GAS COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
	9 Months Ended Sept. 30,
	2007	2006
	(in millions)
OPERATING ACTIVITIES
Net income	$19.5	$ 19.5
Adjustments to reconcile net income to net
cash provided from operating activities:
Depreciation and amortization	31.7	34.1
Deferred income taxes	2.6	(12.1)
Share-based compensation	0.5	0.6
Net loss from asset sales		0.3
Changes in operating assets and liabilities	46.1	131.3
NET CASH PROVIDED FROM OPERATING ACTIVITIES	100.4	173.7

INVESTING ACTIVITIES
Capital expenditures	(93.5)	(68.2)
Proceeds from asset dispositions	0.5	0.7
NET CASH USED IN INVESTING ACTIVITIES	(93.0)	(67.5)

FINANCING ACTIVITIES
Change in notes receivable from Questar		(13.3)
Change in notes payable to Questar	6.5	(77.4)
Checks outstanding in excess of cash	2.8	1.2
Dividends paid	(20.3)	(19.9)
NET CASH USED IN FINANCING ACTIVITIES	(11.0)	(109.4)
Change in cash and cash equivalents	(3.6)	(3.2)
Beginning cash and cash equivalents	3.6	3.2
Ending cash and cash equivalents	$ -	$ -

See notes accompanying the condensed financial statements

QUESTAR GAS COMPANY

NOTES ACCOMPANYING THE CONDENSED FINANCIAL STATEMENTS

Note 1 – Nature of Business

Questar Gas Company (Questar Gas or Company) is a wholly owned subsidiary of Questar Corporation (Questar). The Company provides retail natural gas distribution in Utah, southwestern Wyoming and a small portion of southeastern Idaho. Questar Gas is regulated by the Public Service Commission of Utah (PSCU) and the Public Service Commission of Wyoming (PSCW). The Public Utility Commission of Idaho has contracted with the PSCU for rate oversight of Questar Gas’s Idaho operations.

Note 2 – Basis of Presentation of Interim Financial Statements

The accompanying unaudited condensed financial statements were prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and pursuant to the rules and regulations of the SEC. The interim condensed financial statements reflect all normal, recurring adjustments and accruals that are, in the opinion of management, necessary for a fair presentation of financial position and results of operations for the interim periods presented. Interim financial statements do not include all of the information and notes required by GAAP for audited annual financial statements. These condensed financial statements should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006. Certain reclassifications were made to prior-period financial statements to conform with the current presentation.

The preparation of the condensed financial statements and notes in conformity with GAAP requires that management make estimates and assumptions that affect the amounts of revenues, expenses, assets and liabilities, and disclosure of contingent assets and liabilities. Actual results could differ from estimates. The results of operations for the three, nine and twelve months ended September 30, 2007, are not necessarily indicative of the results that may be expected for the year ending December 31, 2007.

All dollar amounts in this quarterly report on Form 10-Q are in millions, except where otherwise noted.

Note 3 – Accounting for Uncertainty in Income Taxes

In July 2006, the Financial Accounting Standards Board (FASB) issued FASB Interpretation 48, “Accounting for Uncertainty in Income Taxes” (FIN 48). The interpretation applies to all tax positions related to income taxes subject to FASB Statement 109 “Accounting for Income Taxes.” FIN 48 provides guidance for the accounting for uncertainty in income taxes by prescribing a minimum recognition threshold for a tax position to be reflected in the financial statements. If recognized, the tax benefit is measured as the largest amount of tax benefit that is more-likely-than-not to be realized upon ultimate settlement. Questar Gas adopted the provisions of FIN 48 on January 1, 2007. Management has considered the amounts and the probabilities of the outcomes that could be realized upon ultimate settlement and believes that it is more-likely-than-not that the Company’s recorded income tax benefits will be fully realized. There were no unrecognized tax benefits at the begin ning or at the end of the nine-month period ended September 30, 2007. Tax years 2004 and after are open.

The Company records interest earned on income-tax refunds in interest and other income and penalties and interest charged on tax deficiencies in interest expense. As of the date of adoption, there were no amounts accrued for penalties or interest related to unrecognized tax benefits.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion updates information as to Questar Gas’s financial condition provided in its 2006 Form 10-K filing, and analyzes the changes in the results of operations between the three-, nine- and twelve-month periods ended September 30, 2007 and 2006. For definitions of commonly used gas and oil terms found in this Form 10-Q, please refer to the “Glossary of Commonly Used Terms” provided in the Company’s 2006 Form 10-K.

RESULTS OF OPERATIONS

Questar Gas reported a net loss of $8.5 million in the third quarter of 2007 compared with a net loss of $9.2 million in the third quarter of 2006. Net income was $19.5 million in the first nine months of 2007 equal to $19.5 million in the first nine months of 2006. Net income for the 12 months ended September 30, 2007, was $37.0 million, down from $40.1 million in the year-earlier period. Operating loss decreased $1.5 million in the 2007 to 2006 third quarter comparison and operating income increased $0.4 million in the 2007 to 2006 first nine months comparison due to lower rates and higher expenses offsetting the revenues from customer growth. For the 12 months ended September 30, 2007, operating income was $4.5 million lower than the year-earlier period because of a change in rates effective June 2006. Following is a summary of Questar Gas’s financial and operating results:


	3 Months Ended Sept. 30,		9 Months Ended Sept. 30,		12 Months Ended Sept. 30,
	2007	2006	2007	2006	2007	2006
	(in millions)
OPERATING INCOME
Revenues
Residential and commercial sales	$80.4	$86.5	$600.8	$690.4	$898.8		$1,016.6
Industrial sales	2.1	2.6	7.2	20.6	10.1		31.7
Transportation for industrial customers	2.4	1.6	7.0	4.6	9.1		6.3
Service	1.3	1.5	4.7	5.7	6.1		7.0
Other	7.7	8.5	25.6	31.0	33.5		44.5
Total revenues	93.9	100.7	645.3	752.3	957.6		1,106.1
Cost of natural gas sold	62.6	72.7	475.0	581.8	715.0		857.0
Margin	31.3	28.0	170.3	170.5	242.6		249.1
Other operating expenses
Operating and maintenance	18.3	16.7	55.6	55.1	73.7		75.0
General and administrative	9.5	10.1	32.1	30.5	43.5		39.3
Depreciation and amortization	9.7	8.9	28.8	31.1	38.6		42.8
Other taxes	3.5	3.5	10.7	10.8	11.5		11.9
Total other operating expenses	41.0	39.2	127.2	127.5	167.3		169.0
Net loss from asset sales				(0.3)			(0.3)
Operating income (loss)	($ 9.7)	($ 11.2)	$ 43.1	$ 42.7	$ 75.3		$ 79.8

OPERATING STATISTICS
Natural gas volumes (MMdth)
Residential and commercial sales	9.1	8.7	70.1	67.7	104.6		98.2
Industrial sales	0.3	0.4	1.1	2.7	1.5		3.9
Transportation for industrial customers	14.0	9.6	34.9	25.4	45.0		33.7
Total industrial	14.3	10.0	36.0	28.1	46.5		37.6
Total deliveries	23.4	18.7	106.1	95.8	151.1		135.8
Natural gas revenue (per dth)
Residential and commercial sales	$8.83	$9.88	$8.57	$10.20	$8.60		$10.35
Industrial sales	6.03	7.23	6.28	7.82	6.37		8.19
Transportation for industrial customers	$0.17	$0.16	$0.20	$ 0.18	0.20		0.18
Temperatures – colder (warmer) than normal	6%	71%	-	(5%)	1%		(5%)
Temperature − adjusted usage per customer (dth)	7.8	7.9	73.2	76.4	110.4		112.8
Customers at September 30, (thousands)	861.0	835.0

Margin Analysis

Questar Gas’s margin (revenues less gas costs) increased $3.3 million in the third quarter of 2007 compared to the third quarter of 2006 and decreased $0.2 million in the first nine months of 2007 compared to the first nine months of 2006 and decreased $6.5 million in the 12 months ended September 30, 2007, compared with the 12-month period ended September 30, 2006. Following is a summary of major changes in Questar Gas’s margin:


	Change in Margin
	3 Months Ended Sept. 30,	9 Months Ended Sept. 30,	12 Months Ended Sept. 30,
	2007 Compared with 2006	2007 Compared with 2006	2007 Compared with 2006
	(in millions)
New customers	$ 0.7	$ 4.6	$6.6
Conservation-enabling tariff	1.7	5.6	4.5
Change in usage per customer	(0.2)	(5.2)	(3.9)
Change in rates		(6.2)	(10.9)
Recovery of gas-cost portion of bad-debt costs	0.9	(1.6)	(4.1)
Change in transportation revenue	0.8	2.4	2.8
Other, including shifting between rate classes	(0.6)	0.2	(1.5)
Increase (decrease)	$ 3.3	($0.2)	($6.5)

At September 30, 2007, Questar Gas served 861,036 customers, up from 835,025 at September 30, 2006. Customer growth increased margin by $0.7 million in the third quarter of 2007, $4.6 million in the first nine months of 2007 and $6.6 million for the 12 months ended September 30, 2007.

Temperature-adjusted usage-per-customer decreased 1% in the third quarter of 2007, 4% in the first nine months of 2007 and 2% in the 12 months ended September 30, 2007 compared to the same periods of 2006. The impact on the Company’s margin from changes in usage-per-customer has been mitigated by a pilot conservation-enabling tariff that was approved by the Public Service Commission of Utah (PSCU) in October 2006, effective back to the beginning of 2006. The new tariff resulted in a margin increase of $1.7 million in the third quarter of 2007, $5.6 million in the first nine months of 2007 and $4.5 million in the 12 months ended September 30, 2007, largely offsetting the decline in usage-per-customer.

Effective June 1, 2006, the Company reduced gas rates for Utah customers by $9.7 million per year, primarily to reflect a depreciation rate change and corresponding reduction in the Company’s depreciation expense. As a result, Questar Gas realized a $6.2 million reduction in revenues in the first nine months of 2007 compared to the same period of 2006. The depreciation rate change reduced depreciation expense approximately $3.8 million in the first nine months of 2007 compared to the prior year periods.

Weather, as measured in degree days, was 6% colder than normal in the third quarter of 2007, normal in the first nine months of 2007 and 1% colder than normal in the 12 months ended September 30, 2007. A weather-normalization adjustment on customer bills generally offsets the revenue impacts of moderate temperature variations.

Expenses

Cost of natural gas sold decreased 14% in the third quarter of 2007 and 18% in the first nine months of 2007 and 17% in the 12 months ended September 30, 2007, compared to the same periods of 2006 primarily due to lower gas-purchase expenses per dth. Questar Gas accounts for purchased-gas costs in accordance with procedures authorized by the PSCU and the Public Service Commission of Wyoming. Purchased-gas costs that are different from those provided for in present rates are accumulated and recovered or credited through future rate changes. As of September 30, 2007, Questar Gas had a $46.6 million over-collected balance in the purchased-gas adjustment account representing costs recovered from customers in excess of costs incurred.

Operating, maintenance, general and administrative expenses increased 4% in the third quarter of 2007, 2% in the first nine months of 2007 and 3% in the 12 months ended September 30, 2007, compared to the same periods of 2006. Higher labor and benefit costs were offset by lower bad-debt costs. Operating, maintenance, general and administrative expenses per customer were $102 in the first nine months of 2007 compared to $103 in the first nine months of 2006.

Depreciation expense increased 9% in the third quarter of 2007 as a result of increased investment in plant for customer growth and system upgrades. Depreciation expense decreased 7% in the first nine months of 2007 and 10% in the 12 months ended September 30, 2007, compared to the same periods of 2006 primarily as a result of reduced depreciation rates effective June 1, 2006, in accordance with the PSCU order discussed above.

Forward-Looking Statements

This quarterly report may contain or incorporate by reference information that includes or is based upon “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements give expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” and other words and terms of similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, exploration efforts, expenses, the outcome of contin gencies such as legal proceedings, trends in operations and financial results.

Any or all forward-looking statements may turn out to be wrong. They can be affected by inaccurate assumptions or by known or unknown risks and uncertainties. Many such factors will be important in determining actual future results. These statements are based on current expectations and the current economic environment. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance. Actual results could differ materially from those expressed or implied in the forward-looking statements. Among factors that could cause actual results to differ materially are:

the risk factors discussed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2006;

general economic conditions, including the performance of financial markets and interest rates;

changes in industry trends;

changes in laws or regulations; and

other factors, most of which are beyond control.

Questar Gas undertakes no obligation to publicly correct or update the forward-looking statements in this quarterly report, in other documents, or on the Web site to reflect future events or circumstances. All such statements are expressly qualified by this cautionary statement.

ITEM 4T. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)) as of the end of the period covered by the report (the Evaluation Date). The effectiveness of the Company’s internal control over financial reporting was assessed using criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control – Integrated Framework. Based on such evaluation, such officers have concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures are effective in alerting them on a timely basis to material information relating to the Company required to be included in the Company’s reports filed or submitted under the Exchange Act. The Company’s Chief Executive Officer and Chief Financial Of ficer also concluded that the controls and procedures were effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management including its principal executive and financial officers or persons performing similar functions as appropriate to allow timely decisions regarding required disclosure.

This quarterly report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting.

Changes in Internal Controls

Since the Evaluation Date, there have not been any changes in the Company’s internal controls or other factors during the most recent fiscal quarter that could materially affect such controls.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Questar Gas is involved in various commercial and regulatory claims and litigation and other legal proceedings that arise in the ordinary course of its business. Management does not believe any of them will have a material adverse effect on Questar Gas financial position. An accrual is recorded for a loss contingency when its occurrence is probable and damages can be reasonably estimated based on the anticipated most likely outcome. Some of the claims involve highly complex issues relating to liability, damages and other matters subject to substantial uncertainties and, therefore, the probability of liability or an estimate of loss cannot be reasonably determined.

Grynberg Litigation

In Grynberg and L & R Exploration Venture v. Questar Pipeline Co., Civil No. 97CV0471 (D. Wyo.), Jack Grynberg brought certain claims against Questar companies related to the purchase of gas produced from wells located in Wyoming. After the federal district court granted Questar’s motion for partial summary judgment on the major portion of this case, the parties reached a settlement and the case has been dismissed. The settlement will not have a material adverse effect on the Company’s financial position.

Regulatory Proceedings

On October 12, 2007, the Supreme Court of Utah effectively ended a long-standing dispute over the cost recovery of carbon dioxide processing costs by dismissing an appeal by a group of individuals of an order by the PSCU. In October 2005, Questar Gas, the Utah Division of Public Utilities and the Committee of Consumer Services submitted a stipulation to the PSCU to resolve issues related to cost recovery of carbon dioxide processing costs. The PSCU approved the stipulation effective February 1, 2005. The stipulation was appealed to the Utah Supreme Court by a group of individuals who had not participated in the proceedings before the PSCU. The Court held that the petitioners failed to seek timely intervention and lacked standing to appeal the PSCU’s order.

ITEM 6. EXHIBITS.

The following exhibits are filed as part of this report:

Exhibit No.

Exhibits

31.1.

Certification signed by Alan K. Allred, Questar Gas Company’s President and Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2.

Certification signed by S. E. Parks, Questar Gas Company’s Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.

Certification signed by Alan K. Allred and S. E. Parks, Questar Gas Company’s President and Chief Executive Officer and Vice President and Chief Financial Officer, respectively, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

QUESTAR GAS COMPANY

(Registrant)

November 2, 2007

/s/Alan K. Allred

Alan K. Allred

President and Chief Executive Officer

November 2, 2007

/s/S/ E. Parks

S. E. Parks

Vice President and Chief Financial Officer

Exhibits List

Exhibit No.

Exhibits

31.1.

Certification signed by Alan K. Allred, Questar Gas Company’s President and Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2.

Certification signed by S. E. Parks, Questar Gas Company’s Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.

Exhibit 31.1.

CERTIFICATION

I, Alan K. Allred, certify that:

I have reviewed this quarterly report of Questar Gas Company on Form 10-Q for the period ending September 30, 2007;

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and we have:

designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 2, 2007

/s/Alan. K. Allred

Alan K. Allred

President and Chief Executive Officer

Exhibit 31.2.

CERTIFICATION

I, S. E. Parks, certify that:

I have reviewed this quarterly report of Questar Gas Company on Form 10-Q for the period ending September 30, 2007;

any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 2, 2007

/s/S. E. Parks

S. E. Parks

Vice President and Chief Financial Officer

Exhibit No. 32.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Questar Gas Company (the Company) on Form 10-Q for the period ending September 30, 2007, as filed with the Securities and Exchange Commission on the date hereof (the Report), Alan K. Allred, President and Chief Executive Officer of the Company, and S. E. Parks, Vice President and Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)

The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and

(2)

The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

QUESTAR GAS COMPANY

November 2, 2007

/s/Alan K. Allred

Alan K. Allred

President and Chief Executive Officer

November 2, 2007

/s/S. E. Parks

S. E. Parks

Vice President and Chief Financial Officer