Alberta loosens oil curbs by exempting new conventional wells
CALGARY (Bloomberg) - Alberta loosened crude-oil production limits for the second time in two weeks, exempting new conventional wells from output caps in a bid to spur drilling and boost employment.
The policy, which is effective immediately, comes as producers determine capital budgets for next year. It also follows last week’s announcement allowing oil companies to exceed the limits if they ship the additional crude by rail.
Alberta is trying to allow more oil production without overwhelming the province’s strained pipeline network, which took another hit when TC Energy Corp.’s Keystone system suffered an outage last week. Allowing more non oil-sands output could have an outsized effect on employment without resulting in too much additional output.
Alberta produced 480,000 bbl of conventional oil in September, or about 13% of the province’s roughly 3.76 MMbbl of output for the month, but each additional working rig supports an additional 145 direct and indirect jobs, according to the government.
“Companies are currently making investment decisions and we want those dollars and jobs to be in Alberta,” Energy Minister Sonya Savage said in a statement Friday. “We are doing everything we can to help.”
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