SaskEnergy presented their annual report for the 2019-2020 fiscal year on Tuesday morning, calling it a “successful year” that saw infrastructure investment and a record demand in the province.
Demand from SaskEnergy’s industrial transmission customers increased for the fifth straight year and contributed to their highest-ever level of transportation and storage revenue. In addition, the record for customers’ daily natural gas consumption in the province was broken on three consecutive days, with a peak of 1.55 Petajoules on January 15, 2020.
The company reported an investment of $330 million to expand natural gas storage and delivery capacity for customers throughout Saskatchewan. It has resulted in a decreased commodity rate to reflect the low natural gas price environment, which resulted in the lowest commodity rate in 20 years for SaskEnergy customers.
The Crown corporation said its total residential gas utility rate is the third-lowest in Canada.
Bronwyn Eyre, minister responsible for SaskEnergy, said it was a year where the Crown corporation continued to deliver value to its customers and is well-positioned to meet Saskatchewan’s natural gas requirements while continuing to invest in infrastructure to help in the province’s economic recovery.
But the global pandemic and a price war between Saudi Arabia and Russia has harmed the province’s oil and gas sector this year, which resulted in a collapse in oil prices this spring. In fact, listed in the annual report is a statement that reads “the reduction in Saskatchewan gas supply will require more natural gas to be imported from Alberta.”
Eyre said it’s difficult now to quantify the effects from those factors since the fiscal year ended in March when the impacts were just starting to become evident.
“Capital budgets, capital plans will have to be adjusted most likely. But in terms of the trickle down effect, that may well have an impact on capital budgets by industrial companies, which SaskEnergy will have to take into account,” explained Eyre during Tuesday’s conference in Regina.
She added there will not be adjustments to rates in 2020 as the company continues to monitor and navigate through these impacts.
While the company admitted in its report that the magnitude and duration of the pandemic is uncertain at this time, significant disruptions for extended periods of time will increase the severity of those impacts.
The 2019-2020 SaskEnergy annual report can be viewed in its entirety on their website.
