Alberta trims oil & gas royalty forecasts
Gary Park
If this constitutes a setback Alberta can probably absorb the blow.
With near-month gas futures on the New York Mercantile Exchange at their lowest point since mid-2005, the Alberta government is now forecasting oil and gas royalties of C$10.8 billion for the 2005-06 fiscal year which ends March 31.
That’s C$700 million short of projections made in the second quarter of the year, but the overall target is still comfortably ahead of original budget forecasts.
Gas royalties are expected to reach C$8.2 billion, off about C$800 million from the second quarter estimate, but gas prices are on track to average C$8.40 per gigajoule for the year, C$2.80 above the budget numbers.
Oil royalties should total C$2.6 billion, with C$1.18 billion coming from synthetic crude and bitumen and C$1.45 billion from conventional oil.
Both of those figures beat the second-quarter update of C$1.38 billion for conventional oil and C$1.07 billion from the oil sands.
The government now anticipates average oil prices of US$60 per barrel for the year, beating the budget guess by US$18.
Revenues from government land auctions should reach C$3.4 billion, eclipsing the budget numbers by C$2.6 billion and the second-quarter forecast by C$1.8 billion.
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