Oct 23 (Reuters) - Canadian province of Alberta will lift curbs on crude oil production at the start of December, allowing producers to use pipeline capacities and create jobs, the region’s energy minister Sonya Savage said on Friday.
The ruling comes a month ahead of the scheduled expiration of the restriction and at a time when the region’s economy is reeling under the impact of the coronavirus pandemic.
Nearly 16% of the crude production in the province, which is home to the world’s third-largest oil reserves, is currently offline. “Maintaining the stability and predictability of Alberta’s resource sector is vital for investor confidence as we navigate the economic conditions brought on by the pandemic, the commodity price crisis and the need for pipelines,” she said in a statement.
Alberta’s previous New Democratic Party government imposed production limits last year to drain a glut of oil in storage that built up due to congested pipelines.
Premier Jason Kenney’s United Conservative Party government has since then steadily eased curtailments as inventories drained.
The minister said on Friday that while the provincial government will extend its regulatory authority to curtail production through December 2021, it will not set production limits.
The province’s oil output dropped by as much as 880,000 barrels a day, or 22%, at the peak of the production cuts in response to an unprecedented drop in global fuel consumption, Savage had said last week.
Reporting by Shradha Singh in Bengaluru; Editing by Arun Koyyur
Our Standards: The Thomson Reuters Trust Principles.