Oil price woes a 'serious problem' for Canadian economy, says Notley

Alberta Premier Rachel Notleysays the low price of western Canadian crude has become aseriousproblem for the country's economy, adding her government is "furiously" seekingsolutions.

But while the province and the oilpatchexploretheiroptions, Notleysaidthere'sa lack of agreement aroundthe sector on the controversial call for her government to mandate temporary production cuts.

• Canada's oil price woes reaching an 'emergency situation,' Cenovus CEO says

Though the province has an obligation to look at everything, she said, they also want to explore solutions where they might find more consensus with similar results.

"The [price] differential is obviously a very, very serious problem for the energy industry here in Alberta and, quite frankly, for the economy across this country,"Notleytold reporters on Thursday.

"We don't want [oil]racing out of the ground at $10 a barrel. So what we need to do is we need to find a way to get at that differential and, as I've said, there are a suite of options that are in front of us right now."

The price of Western Canadian Select closedat $13.46 US a barrel on Thursday. Meanwhile, the American benchmark price, West Texas Intermediate, closed at $56.49 US.

"We need to work very, very quickly to address it," Notley said. "We're going to have conversations and discussions with all the players about the most effective way to move forward."

Notleysuggested there would be some answers "within weeks and perhaps sooner."

• Canadian oilsands player calls for government to mandate production cuts

The province has been pushing Ottawa to support more crude-by-rail shipments. Last week, the province sent a written business case to the federal government on aproposed strategy.

"There's a range of options for partnering with the federal government, but we are quite committed to being able to provide some kind of solution on a short-term basis as it relates to rail," Notleysaid.

Western Canadian oil prices crashed in September because of a backlog of oil in Alberta.

Oilsands production has increasedthroughout theyear, but export pipelines are full and several refineries in the U.S. that process heavy oil from Alberta, shut down for maintenance.

Those refineries are coming back online but experts think low prices for Canadian heavy crude could persist into 2020.

One estimate peggedthe cost to Alberta's energy sector at $100 million a day.

The situation has spurred CenovusEnergy's CEOAlex Pourbaix, among others, to callfor the Alberta government to mandate temporary production cuts to help correct whathe's termed an "emergency."

But other companiesincluding Suncor, Husky Energy and Imperial Oilbelieve the market is working and the government should not get involved in production cuts.

Richard Masson, an executive fellow at the University of Calgary's School of Public Policy, said the provincial government will be motivated to find a solution quickly.

• Bargain price oil: How long will it last?

He said the provincial and federal governments arelikely losing out on tens of millions in revenues every day.

"We're losing, as a province and as a country, so much money right now by selling our product at way-below-market prices," said Masson, who is also a former head of the Alberta Petroleum Marketing Commission.

"Finding a way to to balance the market quickly is going to be in the interests of all the producers and even for the refiners. They need to make sure that the producers don't end up in financial distress.

"This is an unprecedented situation we're in."