By Charles Lefebvre

Premier eases oil production limits

Jan 30, 2019 | 2:22 PM

EDMONTON, AB — The province is easing the limits on the amount of oil production in Alberta following an increase in the value of the province’s oil.

Premier Rachel Notley announced they will be increasing oil production by 75,000 barrels per day in February and March, for a new total limit of 3.63 million barrels per day.

“We’re not out of the woods yet, but this temporary measure is working,” the Prrmier said in a statement. “While it hasn’t been easy, companies big and small have stepped up to help us work through this short-term crisis while we work on longer-term solutions, like our investment in rail and our continued fight for pipelines. I want to thank Alberta producers for working with us to protect the jobs and livelihoods of thousands of Alberta families and businesses, and your cooperation has been key to easing these limits ahead of schedule.”

In December, the Premier announced a production cut of 8.7 per cent, which took effect January 1. The cut was put in place to address a price differential affecting the province’s oil, and to help reduce the amount of barrels in storage in Alberta, which at the time totalled 35 million barrels.

The release states the province has been able to reduce the amount of oil in storage by 5 million barrels, and they remain on track to remove the storage glut.

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The release also states the government has amended its formula for allocating space under the production limit. Starting in February, the government will use each company’s highest level of production during their best single month from November 2017 to October 2018 as the baseline production level. The change was made after discussions with industry representatives and the Alberta Energy Regulator “to better account for companies that were in the process of ramping up production as part of long-term investments in the province,” according to a release.

The province says the first 10,000 barrels per day produced by a company are exempt from production limits. Only 28 of more than 300 producers in Alberta are subject to the production limits.