Enbridge Gas New Brunswick is maintaining its opposition to the provincial government's new natural gas rules as it appeared in front of the Energy and Utilities Board on Monday.

The natural gas company is still considering a plan to appeal a Court of Queen’s Bench decision from last week that upheld the provincial government’s new regulations.

In the meantime, Enbridge will continue its unusual tactic of objecting to its proposed rate application in front of the energy regulator.

The provincial government’s regulations are forcing lower distribution charges as part of the company's rates. Enbridge had argued it could lose more than $9.7 million a year and be forced to cut its staff in half and reduce services under the new regulations.

Dave Charleson, the general manager of Enbridge, said the company must go along with the new rules even while it objects to them.

"The application that we filed is consistent with what the regulation told us we had to do,” he said.

"But at the same time we've indicated to the Energy and Utilities Board that we don't believe they should be approving the rates. And that'll continue to be our position in the proceedings."

Charleson was on the stand in front of the Energy and Utilities Board and wasted few chances to take a shot at the New Brunswick government.

"My sense is given the current legislative changes it would be significantly higher than that again," he said.

The company first announced in June that it would advise the EUB to oppose its rate application.

The company is also suing the province for violating its original agreement. Legislation in 1999 gave Enbridge sole distribution rights for 20 years and allowed the company to recover costs to build a pipeline system.

Enbridge hasn't signed up as many natural gas customers as it expected to in New Brunswick, and that led it to charge higher distribution fees to pay off its set-up costs.

When it brought in the new rules, the provincial government said natural gas distribution costs could fall by 10 to 15 per cent for residential consumers when the changes are implemented.

Craig Leonard, the province's acting energy minister, said in December that large industrial customers could see distribution costs fall by 40 to 50 per cent.

Enbridge says the government move was a gift to industry such as JD Irving Ltd., which had demanded cheap gas and say residential customers are getting little out of it.

At the current hearing, Enbridge says while government's new formula is forcing it to give multi-million dollar price cuts to industrial customers, residents will have to pay 11 per cent more. It's a scenerio Enbridge blames on government.

"For the majority of our customer base with this rate application, it's actually an increase in rates while it's then the commercial and larger users that are seeing the rate reductions that the government talked about," Charleson said.

The rate hearings that started on Monday are expected to continue until the end of the week.