Alberta raises oil quotas for August as rail exports grow, storage levels slip

The Alberta government says it will ease its oil production curtailment program by 25,000 barrels per day in August.

The province is citing growing crude-by-rail capacity, declining oil inventory levels and improved efficiencies in export pipelines for the move.

Last week, the National Energy Board reported crude-by-rail exports in April reached 236,000 bpd, a 40 per cent increase over March, but still down from the record high of 353,800 bpd in December.

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The province says it is setting a production limit in August of 3.74 million bpd, versus the initial January limit of 3.56 million bpd.

The limits were imposed after discounts on Western Canadian Select bitumen-blend oil jumped to more than US$50 per barrel compared with New York-traded West Texas Intermediate. The difference is now about US$13.70 per barrel, according to oil brokerage Net Energy Exchange.

The first 10,000 bpd a company produces are exempt from production limits, meaning only 29 of more than 300 producers in Alberta are subject to the limits.