Northern Pipeline Agency Quarterly Financial Report (unaudited) For the Quarter Ended June 30, 2024

Statement outlining results, risks and significant changes in operations, personnel and programs

1. Introduction

This quarterly financial report should be read in conjunction with the Main Estimates and any Supplementary Estimates approved in a given year by the date of this report. It has been prepared by management as required by section 65.1 of the Financial Administration Act, and in the form and manner prescribed by the Treasury Board. This quarterly financial report has not been subject to an external audit or review.

1.1 Authority, Mandate and Programs

The Northern Pipeline Agency (Agency) was established by the Northern Pipeline Act in 1978 and in the context of the 1977 Agreement between Canada and the United States of America on Principles Applicable to a Northern Natural Gas Pipeline. The Agency has a mandate to carry out federal responsibilities in respect of the planning and construction of the Canadian portion of the Alaska Highway Natural Gas Pipeline (AHGP) project. The Agency plays a key role in supporting efficient and expeditious regulatory approval, while ensuring environmental protection and social and economic benefits for Canada.

Further details on the Agency’s authority, mandate and programs are available in Part II of the 2024-25 Main Estimates.

1.2 Basis of Presentation

This quarterly financial report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Agency’s spending authorities granted by Parliament, and those used by the Agency are consistent with the Main Estimates for the 2024-25 fiscal year for which full supply has been released by Parliament. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.

The authority of Parliament is required before money can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts, or through legislation in the form of statutory spending authority for specific purposes.

The Agency uses the full accrual method of accounting to prepare and present its annual unaudited departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

2. Highlights of the First Fiscal Quarter and Comparative Results

This Quarterly Financial Report reflects the results as at June 30, 2024, including Main Estimates, and the details presented in this report focus on and compare the first quarter results of 2024-25 with those of 2023-24.

2.1 Authorities Available for Use and Planned Spending for the Year

As at June 30, 2024, the Agency has $569,670 in authorities available for use in 2024-25 compared to $572,629 in 2023-24, representing a decrease of $2,959 which is mainly associated to a decrease of $3,010 related to employee benefit plan expenditures, partially offset by an increase of $51 related to professional and special services.

2.2 Authorities Used and Amounts Expended during the First Quarter

During the first quarter of 2024-25, the Agency spent $21,103 or 3.7% of the total funding available, compared to $19,502 or 3.4% of the total funding available for the same period in 2023-24, for a net increase of $1,601. This net increase, compared to the first quarter of last year, is mainly comprised of an increase in professional and special services due to the need for legal services related to an application from Foothills Pipe Lines Ltd. and a decrease in salary costs due to a reduction of staffing levels.

3. Risks and Uncertainties

In planning for an efficient and effective review and regulation of the project, the Agency must adapt to project developments by the proponent, i.e., to carry out its responsibilities and to make the necessary preparations in concert with the pace of the project’s development.

3.1 Risk Mitigation Framework

The Agency identifies and responds to the pace of the project’s development by continual corporate-level forecasting, tracking and management of issues that could affect or require a response from the Agency. For example, on March 30, 2012, ExxonMobil, ConocoPhillips, BP and TransCanada PipeLines Limited (now TC Energy) announced a work plan to assess liquefied natural gas (LNG) exports from south-central Alaska as an alternative to a natural gas pipeline through Canada. In February 2013, TC Energy notified the Agency that no further work is planned on the AHGP for now, and of their intent to maintain the AHGP assets in Canada. To align with the reduction in the AHGP project activities for the foreseeable future, the Agency has scaled down its operations, while continuing to fulfill Canada’s obligations as set out in the Act.

4. Significant Changes in Relation to Operations, Personnel and Programs

There were no significant changes to operations, personnel and programs during the first quarter of 2024-25.

Approved by:

 

Table 1: Statement of Authorities (unaudited) (in dollars)

	Fiscal year 2024-2025				Fiscal year 2023-2024
Budgetary Authorities	Total available for use for the year ending	Expended during the quarter ended	Year-to-date used at		Total available for use for the year ending	Expended during the quarter ended	Year-to-date used at
	March 31, 2025*	June 30, 2024	quarter-end		March 31, 2024	June 30, 2023	quarter-end
Net Operating expenditures - Vote 1	540,000	13,686	13,686		539,949	11,332	11,332
Statutory Authority - Employee Benefit Plans	29,670	7,417	7,417		32,680	8,170	8,170
Total Budgetary Authorities	569,670	21,103	21,103		572,629	19,502	19,502

* Includes only Authorities available for use and granted by Parliament at quarter-end: Main Estimates.

Table 2: Budgetary Expenditures by Standard Object (unaudited) (in dollars)

	Fiscal year 2024-2025				Fiscal year 2023-2024
Expenditures:	Total available for use for the year ending	Expended during the quarter ended	Year-to-date used at		Total available for use for the year ending	Expended during the quarter ended	Year-to-date used at
	March 31, 2025*	June 30, 2024	quarter-end		March 31, 2024*	June 30, 2023	quarter-end
Personnel	244,670	15,806	15,806		247,680	19,502	19,502
Transportation and communication	25,000	-	-		25,000	-	-
Information	1,000	-	-		1,000	-	-
Professional and special services	280,000	5,297	5,297		279,949	-	-
Rentals	12,000	-	-		12,000	-	-
Repair and maintenance	1,000	-	-		1,000	-	-
Utilities, materials and supplies	1,000	-	-		1,000	-	-
Acquisition of machinery and equipment	5,000	-	-		5,000	-	-
Transfer Payments	-	-	-		-	-	-
Other subsidies and payments	-	-	-		-	-	-
Total net budgetary expenditures	569,670	21,103	21,103		572,629	19,502	19,502

* Includes only Authorities available for use and granted by Parliament at quarter-end: Main Estimates.