18. Provisions
March
December 31, 2014
(millions)
31, 2016
Balance, beginning of period
$ 71
$ 95
Provisions made Provisions settled
7
7
(3)
(3)
Change in discount rate Unwinding of discount
18
28
2
3
Balance, end of period
$ 95
$ 130
The Corporation has estimated the future cost of decommissioning certain natural gas facilities. For the purposes of estimating the fair value of these decommissioning obligations, it was assumed that the costs will be incurred between April 1, 2016 and March 31, 2109. The undiscounted cash flows required to settle the obligations total $276 million (2014 – $253 million). Discount rates between 0.9% and 2.1% were used to calculate the carrying amount of the obligation (2014 – 1.0% and 2.9%). No funds have been set aside by the Corporation to settle these obligations. 19. Equity advances The Corporation does not have share capital. However, the Corporation has received advances from CIC, which reflect an equity investment in the Corporation, to form its equity capitalization.
20. Commitments and contingencies
a. Commitments As at March 31, 2016, the Corporation forecasted to spend $292 million (2014 – $238 million) on capital projects during the 2017 fiscal year, and the Corporation had $136 million (2014 – $51 million) of outstanding contractual commitments for the procurement of goods and services in the future. b. Leases As at March 31, 2016 future minimum lease payments for operating leases entered into by the Corporation, as the lessee, for the next five fiscal years were as follows: (millions) 2017 2018 2019 2020 2021 Thereafter
Minimum lease payments
$
1
$
–
$
–
$
–
$
–
$
–
c. Contingencies The Corporation is involved in litigation in relation to a natural gas incident during 2014 in the community of Regina Beach, Saskatchewan. The Corporation does not expect the outcomes to result in any material financial impact.
21. Unrealized market value adjustments
15 Months
12 Months
Ended March
Ended
December 31, 2014
(millions)
31, 2016
Change in fair value of debt retirement funds
$ 7
$ (2)
Change in fair value of natural gas derivative instruments
(75) (12)
(11) (11)
Change in revaluation of natural gas in storage to net realizable value
$ (80)
$ (24)
Unrealized market value adjustments represent the net income impact of measuring certain financial and derivative instruments at fair value subsequent to initial recognition (Note 9) and measuring natural gas in storage at the lower of weighted average cost and net realizable value (Note 6). These adjustments represent the change in the carrying amount of the related item during the period and are dependent on the market prices and expected delivery dates at the end of the reporting period.
76
Consolidated Financial Statements
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