$0.50 per GJ for the year prior. The decreased differential can be attributed to upstream system improvements and the Temporary Service Protocol discussed above. As transportation is made more readily available from production areas in northeast BC to delivery points in southwest SK, the price differentials should remain near the marginal cost of transportation.
The following chart shows AECO natural gas prices:
AECO Monthly Index Historical Prices Forward Price at Dec 31, 2020 Low Demand for Western Canadian Gas
$3.50
$3.00
2015-Present Average Price $2.01/GJ
$2.50
$2.00
$1.50
$1.00
$0.50
$0.00
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
CONSOLIDATED FINANCIAL RESULTS Consolidated Net Income
Three months ended December 31,
Nine months ended December 31,
2020
2019 Change
2020
2019 Change
(millions)
Impact of fair value adjustments Revaluation of natural gas in storage Income before unrealized market value adjustments
$
$
11 12
29
$
44
$
(15)
$
54
$
(43)
(12)
(8)
(4) (3)
(35)
47
6
-
3
3
3
$
29
$
17
$
39
$
(22)
$
22
$
7
Consolidated net income
Excluding market value adjustments, financial results for the nine months ended December 31, 2020 are $43 million lower than the same period in 2019. The decrease in net income is due to a lower commodity margin, asset optimization margin and lower customer contribution revenues, in addition employee benefits, operating and maintenance costs and depreciation and amortization increased compared to 2019-20. Reduced natural gas market price volatility limited the Corporation’s asset optimization opportunities while increasing natural gas market prices reduced the profitability of commodity and asset optimization opportunities the Corporation did have. In addition, as natural gas production in Saskatchewan continues to decline, the Province
2020-21 Third Quarter Report
7
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