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.
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.
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.
The Canadian Press