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Alberta investing $3.7B to move oil by rail, leasing cars

Last Updated Feb 20, 2019 at 11:40 am MDT

The National Energy Board says crude-by-rail exports from Canada rose to a record 327,229 barrels per day in October. In this Nov. 6, 2013, file photo, a BNSF Railway train hauls crude oil near Wolf Point, Mont. THE CANADIAN PRESS/AP/Matthew Brown, File
Summary

4,400 leased railway cars will move up to 120,000 barrels of oil per day by 2020

The province estimates the plan will lead to a $5.9-billion increase in royalties, tax revenues and profits over 3 years

EDMONTON – The Alberta government says it’s investing $3.7 billion to move the province’s land-locked oil to market by rail.

It says 4,400 leased railway cars will move up to 120,000 barrels of oil per day by 2020.

WATCH: On Nov. 21, Crystal Laderas speaks with Tim McMillan of Canadian Association of Petroleum Producers

Shipments are expected to begin as early as July.

The province estimates the plan will lead to a $5.9-billion increase in royalties, tax revenues and profits over three years, meaning a net gain of $2.2 billion.

WATCH: On Oct. 22, Michael Lumsden reports on Premier Rachel Notley speaking on the pipeline delays.

It expects the discount for Western Canadian heavy oil versus U.S. light crude will shrink by US$4 a barrel.

The rail investment is meant to be a medium-term measure as new pipelines to coastal ports, such as the Trans Mountain expansion to the West Coast, remain in limbo.