The Saskatchewan government says its natural gas utility faced challenges last year because of weather extremes.

Jim Reiter, minister responsible for SaskEnergy, made the comment after the release of the utility's annual report.

He says operational adjustments had to be made to deliver service during one of the province's coldest winters in the last 30 years.

The report shows SaskEnergy had an operating income of $47 million before market adjustments, compared with $79 million in 2013.

Reiter also noted the decline in natural gas prices at the end of last year.

He says it was one of the most challenging years in the company's history.