Pricing Supplement No. 3 dated December 12, 2006 (To prospectus dated February 18, 2004 and prospectus supplement dated September 28, 2004) Filing under Rule 424(b)(3) Registration No. 333-112604

$160,000,000

NORTHWEST NATURAL GAS COMPANY

Secured Medium-Term Notes, Series B

(A Series of First Mortgage Bonds)

and

Unsecured Medium-Term Notes, Series B

Due from Nine Months to 30 Years from Date of Issue

CUSIP No.: 66765R BW5 Secured   X   Unsecured          Principal amount ($): $25,000,000 Issue price (%): 100.000% Selling Agent’s commission (%): .625% Proceeds to Company (%): 99.375% Repayable at the option of holder: Yes          No   X       Repayment Date: Not Applicable     Repayment Price: Not Applicable     Election Period: Not Applicable     Other Terms: Not Applicable Selling Agent(s): Merrill Lynch, Pierce, Fenner & Smith Incorporated.          UBS Securities LLC   X   J.P. Morgan Securities Inc.          Piper Jaffray & Co.

Stated interest rate (%): 5.150% Maturity date: December 15, 2016 Original issue date: December 15, 2006 Interest payment dates: June 1 and December 1, commencing June 1, 2007 Regular record dates: May 15 and November 15 Redeemable: Yes   X   No              In whole              In whole or in part   X   Fixed redemption price: Yes            No   X       Initial redemption date: Not Applicable     Initial redemption price: Not Applicable     Reduction Percentage: Not Applicable     Redemption limitation date: Not Applicable     Make-Whole Redemption Price: Yes   X   No              Make-Whole Spread: 0.15%

Agency Transaction       ¨* or Principal Transaction     x* Name of Principal(s): UBS Securities LLC

*If the Agency Transaction box is checked, the notes are being offered directly by Northwest Natural Gas Company through any Agent, acting as agent for Northwest Natural Gas Company. If the Principal Transaction box is checked, however, the notes have been sold to the Agent(s), as principal, for resale to purchasers upon terms described in the prospectus, dated September 28, 2004 and this pricing supplement. If the Principal Transaction box is checked, the notes are being offered by the Agent(s), as principal, at a price to the public set forth above under “Issue price (%)”; the notes were purchased by the Agent(s), as principal, from Northwest Natural Gas Company at the price set forth above under “Proceeds to Company (%)”; and the Agent(s) received a fee equal to the difference, which is set forth above under “Selling Agent’s commission (%)” as a percentage of the principal amount of the notes.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this pricing supplement or the accompanying prospectus or prospectus supplement is truthful or complete. Any representation to the contrary is a criminal offense.