While bullish Canadian financial analysts and stockbrokers project 2013-2014 heating season prices into a rosy future, one of the country’s biggest dependents on natural gas revenues is sticking to modest expectations.

Upward spikes ignited by an exceptionally severe winter fall short of signaling that an underlying trend of gas price increases has arrived, suggests the Alberta government’s budget for the new fiscal year that starts April 1.

After canvassing industry and public agency forecasters as well as its own experience, the treasury of Canada’s main gas-supplier province is predicting its production will average C$3.29/gigajoule (GJ) (US$3.07/MMBtu) in 2014-2015, little changed from 2013-2014.

The official price forecast in turn generates a painfully low expectation for the Alberta government’s formerly flush gas royalties: C$0.8 billion (US$0.7 billion) in 2014-2015, or about the same as in fiscal 2013-2014.

Nor do the provincial finance minister’s energy advisers predict much improvement later.

The new outlook, or “target” in official budget language, anticipates annual gas prices of C$3.73/GJ (US$3.48/MMBtu) in 2015-2016 and C$3.98/GJ (US$3.72/MMBtu) in 2016-2017. The government also expects little change in oil’s annual average trading range of US$90-100/bbl.

Despite the mild upward price trend seen ahead, annual provincial gas royalty revenue is expected to remain the same at about C$0.8 billion (US$0.7 billion) in fiscal 2015-2016, then sink to C$0.6 billion (US$0.5 billion) in 2016-2017.

Production is expected to continue to taper because the price outlook is agreed by almost all concerned to be too weak to rekindle gas drilling, which has fallen sharply to less than half of Alberta field activity from more than 70% prior to 2009.

The downward trend in output, which has been as severe as 8% per year since 2008, is only slowed down and not stopped by new gas supplies generated as an unintended byproduct of increased drilling for oil and light liquids in shale deposits.

Shale liquids, also known as tight oil in Alberta, are the declared prime targets for all but one of recent large Canadian asset purchase and corporate takeover transactions that have inspired bullish financial analyst forecasts.

The lone exception has been a C$1.6 billion (US$1.4 billion) purchase of 287,500 acres (450 square miles) of shale drilling prospects from other producers in northern British Columbia by Progress Energy, the Canadian subsidiary of Malaysian state energy conglomerate Petroliam Nasional Berhad (Petronas). They have a long-range BC shale development program that focuses on filling their proposed liquefied west coast terminal for exports of liquefied natural gas (LNG), Pacific NorthWest LNG.

But even the Progress-Petronas acquisition is understood to have a tight-oil dimension, at least for the years between now and completion of the LNG terminal. The drilling assets are in a formation known as the Montney, which in BC as in Alberta has sweet spots that include liquids as well as gas.

Alberta’s provincial budget, meanwhile, stands out as a reminder of the scale of revenue losses that all on the supply side of gas markets have endured since shale development started breeding gluts and persistently low prices seven years ago.

In the last nine years of the pre-shale era annual average prices for Alberta production were in the range of C$5-8.50/MMBtu (US$4.45-7.56/MMBtu), and most often at the high end of the band.

Gas royalties were the Alberta treasury’s largest single revenue source as a result of high prices, which propped up drilling and production even in depleting fields dating back to the 1950s while also enabling a harvest of small shallow deposits.

In the flush years of 2000-2008, the provincial government reaped a total of C$52.7 billion (US$46.9 billion) from Alberta gas, or an annual average of C$5.8 billion (US$5.2 billion).

Current annual Alberta treasury royalties from gas of C$0.8 billion (US$0.7 billion) are only 10% of the record C$8.3 billion (US$7.4 billion) set in 2005.

Oilsands royalties are turning out to be no substitute for the old gas riches. The oilsands take is levied on low-grade, discount-priced bitumen, and is calculated as a net-profits share of revenues after plant expenses rather than taken off gross proceeds as in the case of gas.

Although Alberta oil sands output is nearly two million barrels per day and growing fast, annual provincial bitumen royalties are only expected to be C$5.6 billion (US$5 billion) in 2014-2015, C$6 billion (US$5.3 billion) in 2015-2016 and C$7 billion (US$6.2 billion) in 2016-2017 — still well short of the bygone gas bonanza.