Higher oil royalties needed in Alberta
Posted by Tyler Kinch on September 19th, 2007
According to a report commissioned by the province of Alberta, a higher royalty is needed in the oil sands. Although I do not agree with the report completely, specifically not altering the 1% royalty for new projects, I believe it is a good start. Now let’s just hope that Stelmach actually implements the findings in this report… unlike what he did with the task force on affordable housing.
October 10th, 2007 at 1:10 pm
Tyler,
You may want to look a little deeper into the Panel’s report, the validity the economics they ran, the limitations … the report they presented to Dr. Oberg is horrendously negligent on numerous accounts. A futher investagation with people who understand economics and our oil and gas industry needs to be carried out. What is the point of raising royalties if it decreases work and the actual taxable pool? Not only will the $2 billion they hope to obtain be impossible, the actual overall taxes will drop, which in turn will affect federal tax. Not only will your taxes increase to conpensate for this loss of taxes, but your neighbor or mine will likely lose their job.
October 17th, 2007 at 1:29 pm
1)The major bottleneck in the industry is refining capacity, which hasn’t increased in 40 years in north America. With the higher than planned oil prices and soaring margins (reflected by the share value increases of any of the major bellweather integrataed exploration / refining companies) they have drilled further ahead of their refining capacity than usual, and there is already a slowdown happening. This is not due to royalty increases.
2)Due to the tremendous boom, the exploration service companies have cranked up their contract rates to ridiculous levels, making the exploration costs a lot higher. There has already been a slowdown happening in an effort to get the service sector costs back down to reasonable levels. This is not due to royalty increases.
3)It appears that the insanity of a boomtown has become the expected norm. Housing values should continue to double every few years. It’s normal to have restaraunts closing down because of lack of staff. A slowdown is inevitable. Nothing ever booms forever, and a leveling out is very healthy at this point. It will not be due to royalty increases.
4)We are pedalling as hard as possible to give it all away as quickly as possible to the shareholders of foreign owned companies like Shell and Exxon and BP. In the end, it’s gone, and they leave, and all we have is the memories of what our houses were once worth. Why not leverage all we can while we still can, and build healthcare, education, research, etc? Check the stats on what Norway has accomplished.
5)The claim is that if Stelmach is successful, they will leave, and it will crush the Alberta economy, and all the entrepreneurs and working families along with it. BullDung! At all time record high crude prices, and a consistently growing demand for gas, there will be lots of other entities to fill the void if they actually leave. But they wont. Review the choices, and then compare to Alberta with skilled labor, developed pipeline and refining infrastructure, political stability, no wars or history of them on our soil or anywhere near, parked right next to the largest market in the world, etc.
May 30th, 2008 at 7:38 pm
What is your feedback on Stelly’s new royalty regime now that it has been officially released? Or do you think we’ll have to wait until it has been implemented in full-swing (2009) before we will start to see its true effects.
michael
http://shittyofcalgary.com