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April 20, 2004


Led by a vibrant industry that drilled a record number of natural gas wells in Saskatchewan, SaskEnergy posted a profit of $41 million for 2003, up $34 million from 2002.

The Corporation's annual report was tabled today in the Saskatchewan legislature.

2003 SaskEnergy/TransGas Annual Report

"SaskEnergy continues to be one of the most-efficiently operated natural gas utilities in Canada," Minister responsible for SaskEnergy Harry Van Mulligen said. "While continuing to offer its customers rates that are among the lowest in Canada, the 2003 financial performance shows that management continues to focus on building the business for the future."

Highlights of the 2003 business year are as follows:

  • SaskEnergy's distribution utility, which serves the province's 325,000 customers, recorded income from operations of $16 million compared to $8 million for 2002. A combination of increased revenue and lower expenses contributed to the improvement in net income.

  • The accounting treatment of the deficit in the Gas Cost Variance Account (GCVA) led to an overall loss in the utility in 2003. The continued recovery of the GCVA will result in higher than normal profits in the distribution utility in 2004.

  • TransGas, SaskEnergy's transmission subsidiary, recorded a net income of $26 million, up $4 million from 2002. Close to 2,300 gas wells were drilled in the province in 2003, increasing the volumes transported compared to 2002. Saskatchewan remains one of the few jurisdictions in North America where the amount of proven natural gas resources are increasing.

  • Net income from non-core operations in 2003 was $35 million. These incremental revenues were generated from sources such as increased utilization of pipeline and storage assets during off peak periods.

  • SaskEnergy's two international investments were both profitable in 2003. Gas Sur S.A., a Chilean distribution utility 30 per cent owned by SaskEnergy International, recorded a net income of $400,000, while Igasamex, a Mexican transmission business 40 per cent owned by SaskEnergy International, recorded profits of $1 million. Both businesses are expected to be profitable in 2004.

Van Mulligen also confirmed that given current prices in the natural gas market, no commodity rate changes are planned for 2004.

A dividend of $26 million was declared to the Crown Investments Corporation representing 65 per cent of SaskEnergy's profits.

For more information, contact:

Ron Podbielski
Phone: (306) 777-9432