6. DEBT

Short-Term Debt

At March 31, 2013, our short-term debt consisted of commercial paper notes payable with a maximum maturity of 254 days, an average maturity of 61 days, and an outstanding balance of $130.8 million. The carrying cost of our commercial paper approximates fair value using Level 2 inputs due to the short-term nature of the notes. See Note 2 in our 2012 Form 10-K for a description of the fair value hierarchy.

Long-Term Debt

At March 31, 2013, our utility's long-term debt consisted of $651.7 million of first mortgage bonds (FMBs) with maturity dates ranging from 2014 through 2042, interest rates ranging from 3.176% to 9.05%, and a weighted-average coupon rate of 5.71%. During the three months ended March 31, 2012, we did not issue or redeem any FMBs.

At March 31, 2013, our gas storage segment’s long-term debt consisted of $40 million of senior secured debt with a maturity date of November 30, 2016. This debt consists of $20 million of fixed rate debt with an interest rate of 7.75% and $20 million of variable interest rate debt, which currently has an interest rate of 7.00%. The debt is secured by all of the membership interests in Gill Ranch and is nonrecourse to NW Natural.

As our outstanding debt does not trade in active markets, we estimate the fair value of our outstanding long-term debt using interest rates of other companies’ outstanding debt issuances that actively trade in public markets and have similar credit ratings, terms, and remaining maturities to our debt. These valuations are based on Level 2 inputs as defined in the fair value hierarchy. See Note 2 in our 2012 Form 10-K.

The following table provides an estimate of the fair value of our long-term debt, including current maturities of long-term debt, using market prices in effect on the valuation date:



	March 31,				December 31,
In thousands	2013		2012		2012
Carrying amount	$	691,700	$	641,700	$	691,700
Estimated fair value	825,038		742,852		834,664

See Note 7 in our 2012 Form 10-K for more detail on our long-term debt.