Alberta poised to be debt-free

Gary Park

Petroleum News Calgary correspondent

Alberta Premier Ralph Klein set the stage for a fall election by declaring that the province has the needed cash to wipe out its remaining C$3.7 billion debt.

“Today, I am very proud to announce Alberta has slain its debt,” the premier told 2,000 guests at his annual Calgary Stampede breakfast July 14.

The goal was accomplished by setting aside another C$3 billion from Alberta’s 2004-05 budget surplus, on top the C$700 million already earmarked for the purpose.

But the debt will actually remain on the province’s books for at least two years as the government pays off portions as they become due to avoid paying penalties.

During his 12 years as premier, Klein has reduced the debt from C$22.7 billion, accelerating the paydown in recent years as sky-high oil and gas royalties have poured into the treasury. With Alberta entering its centennial year in 2005, Klein has mused about seeking one more term. The debt elimination is seen by many observers as his best chance to go to the polls, but the premier remained coy about the prospects.