Alberta Finance Minister Joe Ceci says the oil-rich economy should return to growth at some point this year. Photo by the provincial government of Alberta.
Feb. 24 (UPI) -- Reconstruction in the wake of wildfires that idled parts of its oil industry and improved energy economics means Alberta is growing, a minister said.
"Alberta's economy is forecast to return to growth in 2017, following a prolonged downturn due to the oil price shock," Finance Minister Joe Ceci said in a statement.
At one point last year, the oil-rich province was anticipating an $8 billion deficit and lingering recession because of the downturn in crude oil prices and May wildfires in the Fort McMurray area that idled about 1 million barrels per day worth of regional oil production.
Turning the corner on reconstruction efforts, the provincial government said it was advancing $15.2 million in funding to support developing in the municipality of Wood Buffalo, one of the hardest hit by wildfires. Nearly 500 development permits were issued and more than 100 homes were built since May.
The province-wide economy, meanwhile, is expected to grow by 2.4 percent this year on the back of higher crude oil prices, exports and reconstruction in Fort McMurray.
Ceci said the government was forecasting on the assumption of crude oil prices of $48 per barrel, about $6 per barrel lower than current rates and $6 per barrel higher than previous estimates. After lower oil prices curbed spending on exploration and production, the government reported 199 drilling rigs active as of January, the highest level since early 2015.
For spending, the capital plan is about $1 billion higher than the five-year average.
"A full economic recovery will take time after such a long downturn, but we are starting to see encouraging signs for Alberta in the year ahead," the minister said.