Alberta says record energy revenues have boosted that provincial revenues much higher than originally forecast.

“Continuing high oil and gas prices, which are resulting in record-high non-renewable resource revenues, have further strengthened Alberta’s 2005-06 financial outlook,” it reports, noting that total revenue is now forecast to be $5.8 billion higher than estimated in the budget, with a record $13.2 billion in non-renewable resource revenues.

The government is returning about $1.3 billion to Albertans through resource rebates and providing $660 million in natural gas rebates to help offset heating costs this winter. Capital spending has been increased by $801 million in 2005-06 to nearly $4 billion. This includes the 2005-06 costs of the multi-year commitments for health, education and roads infrastructure. An additional $3.4 billion is also being deposited in the Capital Account from this year’s surplus to help pay for future capital costs.

Government savings will be increased through a $1.6 billion allocation to the Heritage Fund and endowment funds. Savings highlights include $295 million for inflation-proofing the Heritage Fund, $750 million for the Advanced Education Endowment Fund, $250 million for the Scholarship Fund, $200 million for the Medical Research Endowment Fund, and $100 million for the Science and Engineering Research Endowment Fund.

Total expenses are forecast to increase by nearly $1.5 billion, including $389 million in disaster/emergency funding related to BSE, wildfires, floods and pine beetles; $375 million in additional natural gas rebates; and $481 million for capital grants from the Capital Account.

“Energy prices have risen considerably higher than had been forecast by most energy analysts or estimated in the budget, but energy revenues are only part of the reason Albertans are enjoying tremendous prosperity,” said Alberta Finance Minister Shirley McClellan. “Our strong fiscal position today was made possible through sacrifices, hard work and smart choices by Albertans over the years, and we will continue to make smart choices that reflect Albertans’ wishes to ensure these windfall revenues benefit us all for years to come.”

The Heritage Fund’s report noted investment income from the Fund is expected to be $444 million higher than the budget estimate, reaching a total of approximately $1.1 billion in 2005-06. The book value of the Fund is forecast at $12.3 billion.