FAIRBANKS — Fairbanks Natural Gas is in discussions with the state to become a regulated utility, the company announced Tuesday.

FNG President Dan Britton said the discussions are preliminary but that he’s hopeful that terms of an agreement are met within the next three months. The company could be willing to accept oversight by the Regulatory Commission of Alaska with a phase-in period and the resolution of other agreements, he said.

FNG provides gas service to about 1,100 residential and commercial customers in Fairbanks. It has been exempted from economic rate regulation since 2003 by the RCA.

Britton said non-regulated status has served FNG and its customers well for the past decade by keeping the company free from regulations.

As calls for a state-subsidized gas liquefaction plant on the North Slope have intensified, he said the pressure for RCA oversight of a local gas-distribution network has intensified.

Britton said FNG has been a strong supporter of state funding for the North Slope gas plant and that the company may be willing to accept state regulation if it improves its chance of distributing that subsidized resource.

“We’re expending a significant amount of time in the discussions anyway,” Britton said. “Moving forward, our hope is that we will reach an agreement.”

The docket for the RCA case is U-12-095, in which the RCA is revisiting the regulatory status of FNG.

Contact staff writer Jeff Richardson at 459-7518.