Author Topic: Atlantic surplus could hit over $550M  (Read 1150 times)

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Offline GAP

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Atlantic surplus could hit over $550M
« on: October 25, 2007, 12:11:30 »
Kinda kills Danny Williams loud noises, eh?

Atlantic surplus could hit over $550M
$1B In Oil Royalties; Newfoundland windfall is double budget's estimate
  Rob Antle The Telegram Thursday, October 25, 2007
 Article Link

ST. JOHN'S - The Province's surplus for 2007-08 is on track to exceed half a billion dollars, assuming oil prices stay at the levels they reached in the first half of the fiscal year.

That is double the financial windfall projected in Newfoundland's April provincial budget.

And oil prices have skyrocketed even higher in recent weeks, stuffing more and more cash into the provincial piggy bank.

According to government figures, it is the third year in a row the province has shown a surplus, the first time since Confederation, in 1949, that has happened.

Oil royalties alone were expected to dump $1-billion into the Newfoundland and Labrador treasury this year -- more than double the year prior. But that will likely climb higher.

The province budgeted for the cost of Newfoundland oil to average US$58.56.

For the first six months of the fiscal year, a barrel of Brent crude -- a close, but not exact, reference point for local product --averaged US$71.76.

That is according to statistics maintained by the Energy Information Administration, a branch of the U.S. government.

Experts say every $1 hike in the price per barrel means an additional $30-million for the provincial treasury.

If local oil stays in the US$71 to US$72 range for the rest of the year, that could add up to a windfall of roughly $350-million to $400-million more than expected.
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