8. Lease liability (continued)
As at December 31,
(millions)
2019
Lease liabilities, beginning of period
$
8 7 4
Transitional provision
Net additions
Principal repayment of lease liability
(5)
Lease liabilities, end of period
$
14
As at December 31, 2019, scheduled future minimum lease payments and the present value of the finance lease obligation are as follows for the next five fiscal years:
(millions)
2020
2021
2022
2023
2024
Future minimum lease payments
$
6
$
5
$
2
$
1
$
1
Present value of lease liability
$
6
$
5
$
1
$
1
$
1
9. Commitments and guarantees
Commitments
As at December 31, 2019, the Corporation had $135 million (2018 - $117 million) of outstanding contractual commitments for the procurement of goods and services in the future.
During the period, the Corporation entered into commodity contracts for the physical purchase of natural gas that qualify as own-use contracts. As at December 31, 2019, own-use natural gas derivative instruments had the following notional values and maturities:
(millions)
2020
2021
2022
2023
2024 Thereafter
Own-use physical natural gas contracts
Notional value
$
(21)
$
(74)
$
(69)
$
(65)
$
(59)
$
(355)
Notional value - estimated undiscounted cash outflow
Guarantees
The Corporation has a letter of guarantee issued to facilitate and support regulatory requirements on behalf of its 100 per cent owned subsidiary Many Islands Pipe Lines (Canada) Limited (MIPL). The guarantee is provided to the Canada Energy Regulator (CER), formally the National Energy Board, in the normal course of conducting business. Under the definitions provided by the CER in the Pipeline Financial Requirements Guidelines, MIPL is defined as a Gas Class 1 entity, which will result in an Absolute Liability Limit of $200 million and a Readily Accessible Resource Level of $10 million. The lower limit is readily available funds required in the very short term in the event of a natural gas line release. The absolute limit is the full liability expected to be in place and maintained for losses and damages from an unintended or uncontrolled release. At March 31, 2020, the Corporation’s outstanding Readily Accessible Resource guarantee of $10 million (2018-19 – $nil) will reduce the amount that can be borrowed under the Corporations $500 million credit facility.
10. Unrealized market value adjustments
For the Three Months Ended December 31,
For the Nine Months Ended December 31,
2019
2018
2019
2018
(millions)
Change in fair value of natural gas derivative instruments
$
(8)
$
12
$
(35)
$
13 14
Change in revaluation of natural gas in storage to net realizable value
3
(2)
3
$
(5)
$
10
$
(32)
$
27
26
2019-20 THIRD QUARTER REPORT
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