Province of Alberta

This report does not constitute a rating action. Overview Credit context and assumptions Base-case expectations --High oil prices and increased pipeline capacity will cushion the province from macroeconomic difficulties in 2024. --High tax and resource revenues and continued cost containment will lead to robust operating surpluses in the next two years. --As economic growth lifts revenues, Alberta?s fiscal plan continues to focus on expenditure management, debt reduction, and growing the Heritage Savings Trust Fund (HSTF). --Healthy operating revenue growth and targeted debt repayment will continue to lower the province?s debt burden to about 123% of operating revenues. --Like its Canadian peers, the province?s supportive relationship with the federal government will remain very predictable and well balanced. --Debt service coverage metrics

...High oil prices will continue to bolster the Province of Alberta's economy and, in turn, the province's operating revenues in the next two years. At the same time, the province remains focused on expenditure management. As a result, S&P Global Ratings expects that Alberta will be able to carry this momentum for the next two years as it continues to produce modest after- capital surpluses. In addition, we expect that, in line with the fiscal framework introduced last year, the province will divvy the use of its surplus cash between debt repayment and savings, leading to improving debt metrics and robust liquidity. As a result, we project that tax- supported debt will represent about 123% of operating revenues in fiscal 2027 and the province's internal liquidity generation will be sufficient to more than fully cover the next 12 months of debt service....

Full Report