Alberta’s crude curtailment plan is working so well to support western Canadian oil prices that it won’t likely be needed for too much longer, say executives at Canadian Natural Resources Ltd.

Furthermore, the profitability of crude-by-rail shipments to the U.S. Gulf Coast is intact and will encourage more export capacity growth, they added on Thursday.

“The Canadian oil market was very rocky in the fourth quarter with dysfunctional marketplace dynamics driving historically high differentials for both heavy and light oil in Canada,” said executive vice-chairman Steve Laut on a conference call to discuss financial results.

“The first quarter of 2019 is a completely different story … With curtailments imposed by the Alberta government, market order has been established.”

The remarks stand in stark contrast to recent comments by CEOs from Husky Energy Inc., Suncor Energy Inc. and Imperial Oil Ltd., who said their refining assets and pipeline contracts had allowed them to profit from steep price discounts on Canadian crude and their removal had made crude-by-rail unprofitable.

The CEO of Cenovus Energy Inc., however, said he supports the cuts and his company would increase its rail shipments this year as economics would likely improve.

The province imposed production quotas as of Jan. 1 on larger producers designed to keep 325,000 barrels per day of crude off the market and eliminate a glut of trapped oil. The target was cut to 250,000 bpd in February and March and set at 225,000 bpd for April.

Canadian Natural, one of the largest oil producers in Alberta, has been required to cut 95,000 bpd this month, said president Tim McKay in an interview.

The company is advancing a planned maintenance turnaround at its Horizon oilsands mine into March from April to reduce the impact of the cuts and has been drilling fewer wells than planned, he added.

It also is considering delaying startup of the 40,000-barrel-per-day steam-driven Kirby North oilsands project that is nearing completion, as well as new wells expected to add 26,000 bpd of production at its Primrose thermal oil project in northern Alberta.

Canadian Natural blamed low oil prices for a net loss of $776 million in the fourth quarter of 2018, compared with a profit of $396 million a year earlier, but announced a 12 per cent increase in its quarterly dividend to 37.5 cents per share.

Its shares climbed by about three per cent to $36.90 by mid-afternoon on the Toronto Stock Exchange as analysts reported its operating results were largely in line with expectations, though adjusted profit fell short.

McKay said Canadian Natural is currently shipping about 14,000 bpd of crude by rail and that may rise.

He pointed out that heavy oil at the U.S. Gulf Coast is now trading at a US$2 per barrel premium to New York benchmark West Texas Intermediate, which improves the return from shipping oil there by rail.

Last week, Enbridge Inc. announced permitting delays in Minnesota meant its Line 3 replacement pipeline, expected to add 370,000 bpd of export capacity of Canadian crude, won’t open until the second half of 2020, a year later than expected.

The project was being counted on to help move Alberta oil but McKay said other factors remain in place, including natural declines in conventional oil output due to lower spending and the Alberta government’s $3.7-billion commitment to lease rail cars to transport up to 120,000 bpd of oil.

He said the $9.7-billion Sturgeon Refinery near Edmonton co-owned by Canadian Natural is expected to soon be able to start accepting diluted bitumen for processing, which will eventually divert 80,000 bpd from the export stream.

Canadian Natural production in the quarter averaged 1.08 million barrels of oil equivalent per day, up from 1.02 million boe/d in the fourth quarter of 2017.