Alberta Premier Rachel Notley. (Black Press Media files)

Alberta government announces further easing of oil production restrictions

The government said it will continue to monitor the market and its response to the increases

The Alberta government has announced another easing of restrictions on oil production, saying the amount that can be produced will increase in May by 25,000 barrels per day and another 25,000 barrels per day in June.

The province mandated production cuts at the start of this year in an effort to reduce a price discount on oil produced in Western Canada, which is due to a lack of pipeline and rail capacity.

The province says in a news release that less diluent is needed to move the bitumen through pipelines when the weather is warmer, meaning there’s more capacity.

The Alberta government initially ordered production of raw crude oil and bitumen to be cut by 325,000 barrels per day.

Since then, the province has eased the mandatory cuts as the discount for Western Canadian Select bitumen-blend oil compared with New York-traded West Texas Intermediate has fallen.

It says that when both increases are in effect in June, it will represent a total increase of 150,000 barrels a day since the start of the production limit policy on Jan. 1.

“As we increase production, we’re providing even more certainty for producers who have been working with us to protect the jobs and livelihoods of thousands of Alberta families and businesses,” Premier Rachel Notley said in Monday’s news release.

“This temporary policy has been critical to reducing the oil price differential while we move ahead with our medium-term plan to ship more oil by rail and lead the long-term charge for new pipelines as we fight to get full value for the resources owned by all Albertans.”

Effective June 1, the province will allow 3.71 million barrels per day to be produced.

When the production limits were announced in December, the government said it would buy as many as 80 locomotives and 7,000 rail tankers, expected to move the province’s excess oil to markets, with the first shipments expected in late 2019.

Monday’s news release said the province’s crude-by-rail program is scheduled to begin initial shipments in July, ramping up to 120,000 barrel-a-day shipments by 2020.

The government said it will continue to monitor the market and its response to the increases, and will work to provide information prior to trading periods for future months.

READ MORE: Notley’s government puts priority on health care in throne

The Canadian Press


Like us on Facebook and follow us on Twitter.

Just Posted

Sylvan Lake woman recounts her experience trekking Mt. Everest

Perle Campbell and her daughter travelled to Nepal in May to hike to base camp on Mt. Everest

Sylvan Lake Midget Buccaneers secure playoff spot

The Midget Buccs defeated the Didsbury Chargers 11-6 on June 15 to close out regular season play

AMBER ALERT: Alert cancelled after child located safe and unharmed

Alert cancelled after child located safe and unharmed

Sylvan Lake Yettis clinch league’s top spot

The Yettis have a first round bye and will play the second round of playoffs on home court, July 5-7

MP Blaine Calkins tables rural crime bill

Bill C-458 was tabled Friday, and proposes to amend the Criminal Code to account for rural residents

VIDEO: ‘Avengers: Endgame’ to be re-released with new footage

‘Avatar’ holds global box office record at $2.788 billion, while ‘Endgame’ stands at $2.743 billion…

Wetaskiwin RCMP look for wanted man after liquor store robbed

Wetaskiwin RCMP investigate armed robbery

Air Canada expects Boeing 737 Max to resume flying by September or October

Air Canada isn’t worried about safety of the planes, says vice-president

More than 700 wildlfire evacuees in Alberta can soon return to Metis community

Evacuees from the Paddle Prairie Metis Settlement can safely return starting on Thursday

B.C. files second legal challenge against Alberta over turn-off-taps law

B.C. government filed a second lawsuit against Alberta on June 14

Tax credits, penalizing big polluters, key to Conservative climate plan

Canada’s commitment is to cut emissions to 70 per cent of what they were in 2005 before 2030

VIDEO: Acknowledging skeptics, finance minister vows to build Trans Mountain project

Bill Morneau said he recognizes ‘huge amount of anxiety’ in Calgary over future of oil and gas sector

Shovels could be in the ground on Trans Mountain by September, CEO says

Ian Anderson points to weeks likely required for NEB to reinstate 2016 regulatory record

Calgary man facing charges after B.C. police service dog aids in arrest

Heavy police presence results in PSD Jagger finding suspect

Most Read