Alberta is now debt-free, Premier Ralph Klein announced Monday.
Mr. Klein attributed the province's fiscal success to high energy revenue and "the hard work of Albertans."
He said the debt, which stood at nearly $23-billion in 1993, "will be paid off to the last cent."
Almost all of that was racked up between 1982 and 1992, when oil prices crashed. Soaring prices for the resources have led to billion-dollar budget surpluses since the mid-1990s.
The province announced last month that it had a $4-billion surplus in the 2003-2004 budget year.
"I've been dreaming about this day for quite some time now," Mr. Klein told a news conference.
The Premier declared the days of debt in the province to be over and said the government would put in legislation to ensure that it would not happen again.
No other province in Canada can attest to being debt-free.
The last time a province declared itself debt-free was in the late 1960s in British Columbia.
Mr. Klein said Alberta's willingness to "face problems head-on and pioneer new ways of responding to them" is the reason that the province was able to do so.
He said his government will consult with Albertans in the fall on how to spend future surpluses.
"Wiping out the debt means Alberta has new options in how it uses surpluses-the government will ask Albertans what options are important to them."
Finance Minister Pat Nelson said there may be some penalties for paying out the debt early, but that will be detailed when the government releases its first-quarter results in August.
"It's cleared, it's over with and we can go home to our kids and our grandkids and say, 'We have protected your future so you will not be carrying the burdens of the past,'-" said Ms. Nelson.
His news conference was interrupted at one point by protester Donna McPhe, who shouted "Dictator!" at him and accused him of balancing the books on the backs of the poor.
Ms. McPhe later told reporters: "We're supposed to look at the Premier with his cowboy hat on and think he's an emperor. Well the emperor has no clothes to me."
Earlier Monday outside the McDougall Centre, Mr. Klein played host for his annual Calgary Stampede pancake breakfast.
The Premier was hit in the face with a pie from a protester at last year's breakfast. This year, there were no incidents as security around the Premier was sizable and conspicuous.
Mr. Klein, who is expected to call an election as early as this fall, had mused aloud previously that paying off the debt by Alberta's centennial year of 2005 would be a nice legacy.
Even before Monday's announcement, however, Alberta's opposition parties have criticized the Progressive Conservative government's approach to spending and saving.
Liberal Leader Kevin Taft said there is no point to having a surplus when Albertans walk into crowded hospitals and classrooms and drive on crumbling roads.
New Democrat Brian Mason said the Mr. Klein government does not deserve credit for the windfall, because oil and gas price increases guaranteed the surpluses regardless of how the Tories steered the economy.
The Canadian Taxpayers Federation has said the surpluses show that Albertans are grossly over-taxed by the Tory government and that rather than reward taxpayers, Mr. Klein has chosen to instead give double-digit pay increases to public-sector workers.
Alberta's surpluses have also been buoyed by a higher take of taxes, lottery revenues and health-care premiums to go with spending cuts in various departments.