2015-16 SaskEnergy Annual Report

Edam and Vawn Pipeline Projects In October 2015, the Corporation completed 15 kilometres of new pipeline to provide service to Husky Energy and Serafina Energy enhanced oil recovery operations near Edam and Vawn in west-central Saskatchewan. SaskEnergy, through its subsidiary TransGas Limited, used an innovative odourant injection system on this project, thereby enhancing process safety and reducing cost. As the cost of these projects was paid by the customers, TransGas worked closely with Husky and Serafina to ensure that the cost was within their expectations. Consistent with Crown Sector Strategic Priorities, TransGas was able to provide timely access to its transportation service through this project, while collaborating with customers to provide service at a reasonable cost. Flare Gas Capture in Southeastern Saskatchewan Capturing the volumes of natural gas produced in conjunction with Saskatchewan oil drilling/development represents a key opportunity to increase Saskatchewan gas production and, in turn, decrease the need for natural gas imports from Alberta to meet Saskatchewan’s growing energy demands. To this end, TransGas installed major transmission infrastructure in the southeastern part of the Province in 2015 to receive vital associated/flare gas volumes while facilitating gas processing initiatives in the area. To deliver an effective compression solution, TransGas leveraged a modular design, as well as learnings from a previous build at Saskatoon, to allow for two mobile trailers to be docked and operate as one system. In addition, TransGas utilized new project management processes to keep on-track and work through issues. Designed and installed in a record seven months, this new compression allowed previously constrained gas producers in the area to generate revenue through incremental volume flow, while creating increased transport revenues for TransGas.

Meter Exchanges SaskEnergy, along with a third-party contractor team, removed and replaced approximately 41,000 meters throughout the Province in 2015 — another record number, which is 4,000 more than 2014 and 16,000 more than in 2013. A further 18,000 meters were exchanged during the first three months of 2016. SaskEnergy accelerated the rate of meter replacements due to the introduction of stricter Measurement Canada compliance requirements that were implemented in 2013, and to ensure compatibility with its new Advanced Metering Infrastructure. The larger number of meter replacements was achieved through effective planning to maximize field technician productivity, and greater coordination with customers to ensure that most meter exchanges were completed by appointment. Response to Northern Forest Fires In late June 2015, smoke from the forest fires in northern Saskatchewan blew south, blanketing many cities and towns in the southern half of the Province, and even crossing the border into the United States. While the air quality decreased in these regions, the situation was significantly worse at Air Ronge, La Ronge, Montreal Lake, Weyakwin and other northern communities. The level of urgency from SaskEnergy/ TransGas crews and other first responders grew, and their response was outstanding. The efforts of SaskEnergy/ TransGas employees and their response to the fires were recognized internally at the annual SaskEnergy Employee Awards of Excellence, and externally, with recognition at the Legislative Building in Regina in November 2015.

CREATING VALUE

Productivity and Efficiency Initiatives In 2015, SaskEnergy realized $5.9 million in efficiency savings and process improvements through a combination of joint servicing activity with other Saskatchewan Crown corporations, the use of mobile compression and business process changes. With a multi-year financial focus, savings will continue to be gained through efficiencies achieved through planned Crown collaboration initiatives, business process changes and leveraging technology solutions. Further efficiencies related to strategic capital deployment have also been identified for future periods. In addition to the planned efficiencies that SaskEnergy incorporated into the Business Plan for 2015, further restraint measures were undertaken in alignment with provincial government heightened cost management. Within this direction, SaskEnergy re-evaluated the inputs that were included as part of the 2015 Business Plan and also undertook restraint measures including salary freezes, vacancy management, reduced travel and training costs and reduced advertising and sponsorships.

OUR TEAM

Developing Leaders and Realizing Training Efficiencies In alignment with the Crown Sector Priority of building an effective workforce through innovative strategies that attract, retain and develop skilled workers, SaskEnergy remains committed to developing its leaders at all levels. The most recent Leadership Development Program class, which included two SaskWater participants, concluded its program in early 2015. Other leadership learning opportunities throughout 2015 included internally-facilitated learning sessions, mentoring and stretch job assignments. The Executive and employees in the Generation Energy (Gen-E) group (ages 30 and under) also came together in an annual session to promote dialogue on business topics. The use of online tools, e-learning and video to effectively deliver information and training continued to bring efficiencies to learning on management, leadership, technical and compliance topics.

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