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EDMONTON — Alberta is on track to record a $1.4-billion surplus on day-to-day spending this year, but it will be $8.5-billion in the hole on the capital side due to borrowing for new schools and roads.

Finance Minister Doug Horner had originally forecast a $451-million deficit on day-to-day operational spending, but he said Wednesday that higher-than-expected oil prices, along with a low Canadian dollar, have changed the economic outlook.

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“We’re turning the corner,” Mr. Horner told a legislature news conference as he delivered his third-quarter budget update for 2013-14.

“But we know that we must still be careful about what lies ahead. We need to be ready for what we can’t see around that corner. We all know how much our revenues can fluctuate in a short period of time.”

Mr. Horner said given the volatility in oil and gas prices, the province will continue to hold the line on spending when he brings down the 2014-15 budget on March 6.