Alberta will record a wider budget deficit in the fiscal year that began April 1 because of declining revenue from oil, Finance Minister Doug Horner said.
The deficit will widen to a range between C$2.3 billion ($2.32 billion) and C$3 billion, up from an original forecast of C$886 million, Horner said on a conference call with media from the provincial capitol of Edmonton. The province’s outlook for oil has been cut to an average of $92.75 a barrel from an initial forecast of $99.25 on Feb. 9, government documents show. Oil has averaged $92.42 Since April 1.
“My mandate is to have a balanced budget in 2013-14,” Horner said. “That’s my target and that’s where I’m headed.” The provincial economy is set to grow by 3.8 percent this year, according to a government document, with a budget surplus of C$952 million forecast for the 2013-14 fiscal year.
Alberta posted a deficit of C$588 million in the first quarter of this fiscal year, higher than the initially forecast C$194 million, on lower oil royalties and taxes due to price declines for the fossil fuel. The government gets a third of its revenue from royalties and taxation of the oil and gas industry. Alberta is home to the world’s third-largest oil reserves after Saudi Arabia and Venezuela.