Nfld. & Labrador

Debt not the priority with oil windfall: Michael

The province would be better served if unexpected oil revenues were directed to public programs, not the debt, NDP leader says.

Newfoundland and Labrador would be better served if unexpected oil revenues were directed to public programs, not the accumulated debt, NDP Leader Lorraine Michael says.

Michael was reacting to Finance Minister Tom Marshall's revelations that the government is poised to collect about $600 million more than expected this year, because of higher-than-expected production at the province's three offshore oil fields.

Marshall said it is too early to guess how much larger the province's surplus will be, but that it will go towards the total debt, which stands at about $8.2 billion.

Michael said the money is not a true windfall, as extra production means reduced production — and lower revenues — later.

"This money, I think, needs to be seen as revenue that has come early, and we [should] keep it until we look at how we need to spend our money in 2012/2013," Michael told CBC News.

Marshall's latest budget, tabled in April, projected a surplus of $59 million, and is based on Brent crude trading at an average price of $108 through the year.

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