The province's first-quarter update says borrowing for capital projects is now forecast to be just over $2 billion in 2014-15 — down from $4.8 billion in the last budget.
The overall projected surplus for the year has grown by $300 million since the budget to almost $1.4 billion.
Finance Minister Doug Horner said revenue is up due to higher energy forecasts and stronger corporate income taxes.
"I can say with confidence that I believe we have turned the corner financially," Horner said Wednesday. "When it comes to Alberta's economic indicators, everything is looking up."
Total revenue is on track to be up by more than $900 million. Most of that increase is coming from non-renewable resources.
Operational expenses are also up by $328 million. That is being attributed to increased funding for post-secondary institutions, a reassessment of flood assistance spending and more money to combat mountain pine beetles.
NDP Leader Brian Mason said things will head south as soon as oil prices drop and it's time the province stops depending on such an unstable revenue source for daily operations.
"While it is up now, it will be down tomorrow, and unless we can get off the royalty roller-coaster, we are going to continue the situation where, when the price of oil drops, we are laying off nurses and teachers," Mason said.
Critics, such as the Opposition Wildrose party and the Canadian Taxpayers Federation, have complained that the surpluses don't paint a true picture of the government's financial standing because they are being underwritten by billions in debt to pay for capital projects.
The province is forecasting a total debt of $11 billion since it began borrowing to pay for infrastructure in 2013. That's down $2.8 billion from what was forecast in the spring budget.
"We are at a time when we are getting record revenues and we have a government that is still not able to live within its means," Wildrose Leader Danielle Smith said.
"They have demonstrated they simply are not capable of managing our incredible wealth and our incredible resource wealth. There is absolutely no excuse for us to be running a shortfall."
Horner dismissed that criticism.
"At the end of the day, no matter how you analyze the numbers, the strong surplus position does not change," Horner said. "Alberta is on strong financial ground and will continue to be going forward."
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