REGINA - Slumping oil prices could force Alberta to end the year with a $3-billion deficit, but Saskatchewan is promising it won't end up the same.

Alberta's nouveau riche next-door neighbour has become flush with oil revenues - a large part of the reason Saskatchewan was the only province to post a balanced budget this year. But those revenues are quickly shrinking.

The province's energy resources minister says his government understands its need for oil money to keep financially afloat, and is now looking at alternative solutions.

"At first quarter, we recognized that the price of oil was below where we pegged it and we thought it important to look at our spending side," Minister Tim McMillan told QMI

Agency on Friday. "So, each ministry has been asked for half a percent of budget reduction and they will be expected to bring that forward to ensure that our financial targets are met."

In tabling its balanced budget, the Saskatchewan Party used a $100-a-barrel benchmark to predict its oil revenues, which would have had the province take in $1.6 billion.

"Following budget, it bounced above that for a while, but then quite a bit below it for a while as well," McMillan said.

Oil has since been hovering around $90 a barrel, which McMillan says is in a range that will allow the province to stay in the black.

"We were in a fortunate position to have a surplus budget and that gives us a little cushion, but we are also going to make some tough decisions on the spending side," he said. "We believe in having a balanced budget and we are going to continue to work towards that."