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Alberta is about to buy railway wagons to promote crude oil transportation



Albert's Prime Minister, Rachel Notley, speaks in Ottawa on November 28, 2018.

Adrian Wyld / Canadian Press

At the beginning of the new year, Alberta plans to buy tractors to transfer an additional 120,000 barrels of oil a day from the province as it thinks that calls for a reduction in production to reduce surplus supply, which has allowed Canadian oil prices to build up the basement levels.

Premier Rachel Notley is forced to find an alternative to the Alberta oil ship due to lack of power pipelines. In addition to adding more railroad cars, she is considering offering incentives to companies that are already willing to cut production, including interrupting future royalty payments. She even looks at the compulsory reduction in production across the industry. Such measures would reduce supply to allow oil market prices to rebound.

Mrs Notlia, on Wednesday, called on the federal government to support the government's transition to the purchase of crude oil and locomotives, but said that the province would, if necessary, act separately and close to concluding such a deal. She said that oil trains will eventually add 120,000 barrels of export per day, in addition to the current 350,000 barrels per day of crude oil extraction.

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"This investment has value not only from a more direct perspective, but also from the risk of further delays in pipelines," said the prime minister. "The federal government needs to listen to it. There is no excuse for their absence."

Ms Nonley said oil prices were being cut, "because Canada deliberately holds the Alberta economy and the hostages of the Canadian economy", not being able to build new pipelines.

In a letter that was sent almost three weeks ago, Mrs. Notlia urged prime minister Justin Trudeau to respond in a crisis of a severe fall in Alberta's oil prices and financial support for her plan to buy tractors.

The question of the funding request on Wednesday the Prime Minister's Office asks the Department of Natural Resources. Ambassador Amrjeet Sohi, the Natural Resources Minister, said that federal government officials are working with Albert's colleagues to analyze options, including addressing crisis situations, including a proposal by Mrs Notley. "We are focused on ensuring that every Albert oil syringe gets full value," Vanessa Adams said in an e-mail.

Due to lack of pipeline and lack of Albert's inventory, prices for Western Canadian crude oil prices have fallen sharply over North Texas Standard West Texas Intermediate (WTI), which has fallen sharply since late October to end at $ 50.30 a barrel on Wednesday. According to NetEnergy, a Calgary-based trading company, the Western Canadian Select, which traded at $ 41 per barrel in December, dropped $ 33.50 on January delivery. NetEnergy reported that Edmonton's light crude oil, which is typically sold at a small premium to WTI, is sold at a discount of $ 25.25 on Wednesday.

Alberta Conservative Party leader Jason Kenney on Wednesday revealed the heat to the prime minister of the new Democratic Party, urging the government to force 13,000 big producers to cut 200,000 barrels per day, while liberating small businesses from politics. These reductions will exceed daily reductions of about 200,000 barrels already reported by several oil companies, including the giant Cenovus Energy.

"I am a free-market conservative," Mr Kenney told reporters in Edmonton. "I think that government intervention in the markets should usually be avoided, so I initially opposed the idea of ​​a mandatory reduction, when it was flooded for a few weeks ago. But after extensive discussions, I now believe that action is needed."

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The Alberta government is still assessing whether to reduce production or create incentives to achieve voluntary reductions. It will announce its plan "next week or so," said Notley. She confirmed that the options include some incentives related to royalty payments, but added that many other approaches were being considered.

"The industry itself is very complicated, players are organized differently, and each has different effects, and it's the royalty mode that they are working on," she said. "So we have to look at the whole picture."

The Premier said additional rail capacity would raise West Canadian crude oil prices by $ 4 per barrel and pay off over the next few years before the extension of the Trans Mountain pipeline would be completed. And it would be like insurance against further delays of the pipeline, she said.

At the Copenhagen Parliamentary Elections on the Occasion of Colombia, the Conservative Party opposition launched an extraordinary debate, arguing that the Liberal Government has not been able to respond to the crisis that is spreading from Alberta and affecting the entire national economy.


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