CN Rail strike, Keystone pipeline spill lead Alberta to extend oil curtailment levels

Click to play video: 'CN Rail, union reach tentative agreement to end strike' CN Rail, union reach tentative agreement to end strike
WATCH ABOVE: The strike involving about 3,200 CN Rail workers has ended after a marathon negotiating session resulted in a tentative deal. Mike Armstrong looks at what workers were fighting for, and how the walkout could affect Canada's economy – Nov 26, 2019

The Alberta government says it will leave its oil production quotas unchanged in January to deal with the lingering consequences after oil shipping was delayed by the Canadian National Railway Co. strike and the temporary shutdown of the Keystone pipeline following a leak in North Dakota.

READ MORE: CN strike is over, but experts warn supply chain could be off-track for weeks

A spokesman for Energy Minister Sonya Savage says producers were informed Tuesday that the production limit for January will remain at 3.81 million barrels per day, the same as December, after several consecutive months of easing quotas.

Production limits were enacted by the previous NDP government starting in January to better match supply levels with pipeline capacity and alleviate wider-than-usual local price discounts for Alberta oil blamed on high inventory levels.

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The curtailment program was to expire at the end of 2019 but the United Conservative government extended it through 2020 while gradually increasing the amount that can be produced. The quotas now affect only the top 16 producers.

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The province recently announced oil production from new conventional wells won’t be subject to curtailment and producers who add crude-by-rail shipping capacity can also produce more.

Crude-by-rail exports from Canada rose to 310,600 bpd in September but remained short of the record 353,800 bpd set in December 2018.

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