2017-18 SaskEnergy Annual Report

SASKENERGY 2017-18 ANNUAL REPORT

CHAIR’S MESSAGE

On behalf of the SaskEnergy Board of Directors, it is my pleasure to join the Minister Responsible for SaskEnergy, the Honourable Bronwyn Eyre, in presenting the SaskEnergy 2017-18 Annual Report. SaskEnergy delivered strong financial results in 2017-18, including $110 million in income before unrealized market value adjustments, a 12.2 per cent consolidated return on equity, and a strong debt-to-equity ratio. Annual measures related to operational efficiency, customer satisfaction and greenhouse gas reductions also exceeded targets. Certainly, these outcome-based metrics provide a measure of corporate performance. However, they can be heavily affected, positively or negatively, by factors outside of SaskEnergy’s control — weather, natural gas market conditions, and decisions by regulators, customers and third-party transporters, among others. In many ways, an analysis of specific actions over the past year paints a more meaningful picture of SaskEnergy’s chosen focus areas. In 2017-18, the Corporation dedicated $109 million toward system integrity initiatives across its more than 85,000 kilometres of pipeline. After weighing a range of options, SaskEnergy leadership made the difficult decision to remove natural gas service from customers in sections of the Last Mountain Lake area where frequent ground movement had created unsafe conditions. Finally, in January, 150 employees and managers delivered an outstanding effort to restore natural gas service in the Melfort area after the largest outage in SaskEnergy history, deemed to be the result of unreported third-party infrastructure damage. As Board Chair over the last five years, I have consistently noted the desire to increase the safety of Saskatchewan communities as a motivating factor for projects and recommendations brought before the SaskEnergy Board of Directors, and we are proud to support these efforts. This focus is fundamental to SaskEnergy and well-embedded within decision-making processes and operational practices across the company, regardless of financial conditions, market changes or other variables in the business environment. The Board is committed to the effective stewardship of SaskEnergy, and thanks the Executive team, management and employees for their contributions this past year. [Original signed by S. Barber] Susan Barber, Q.C. Chair, SaskEnergy Board of Directors

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