Royalty Review Panel - email submissions part 4 of 7

Random Nbr Released Comment
RRE3000 I don't believe that increasing royalties will not affect the level of oilfield activity in Alberta, or the financial well-being of Albertans. In addition to lowering the financial welfare of people working for oil & gas companies and service companies, the people employed indirectly (in hotels, restaurants, auto dealerships, building construction, etc) will be threatened. From my observation, the affluence of people directly employed in the oil industry is shared throughout our economy. Finally, people in the oil and gas industry contribute to the Alberta and federal revenues through income tax and GST. The proposal to increase royalties will have an immediate popular appeal as big oil companies are generally negatively portrayed in the media. Giving in to that appeal and creating economic slow down will not win the government any friends in the long run.
RRE3001 50% or more increase might be better. I support our government to collect more money from these companies. [Information Removed]
RRE3002 The royalty review was a good exercise. However, the increases they proposed made it clear that they did not understand the industry. No one believes there can be some increases, but changing the deal mid way through is just bad business and even worse ethics. I, for one, would rather the idustry keep the current rates and use that investment money to create jobs and the trickle down effect than give more money to a government that is more than likely to spend the money unwisely. I will not vote for a government that believes they can allocate money and resources better than industry. [Information Removed]
RRE3003 I will be very VERY angry if the Alberta government does not raise royalties by the amount specified by the royalty review. I want a moratorium on new oil sands projects and if the government doesn't raise royalties I will do everything I can to stop the PC candidate from being elected in my riding.
RRE3004 Much has been written and said since the release of the report. The oil companies are against raising the royalties, the public generally in favor. The oil is in the ground, and it is not going anywhere until developed. If capital expenditures are reduced as is being threatened by some oil companies - that would be a good thing. It's just too busy in Alberta now, and obviously unsustainable. Like Ed said, let's all relax and don't act prematurely. My opinion - from a 46 year old resident of Alberta since 1981, an engineer working in the oil industry is this; Raise the royalties as suggested in the report, that way we will get the maximum benefit from this non renewable resource, whether it is developed now or 10, 20, 30 years from now. The oil companies that pull out of Alberta now will return. By that time the super heated unsustainable economy will be on a more managable footing and life as we love it in Alberta be back to normal. Natural gas is the life blood of this province, and royalties should be raised in this resource also. This issue is a show stopper for the conservatives, and will cost them the next election if not addressed for the benefit of the population and not the oil companies. There is change in the air, especially with the influx of new residents to the province in hte past 5 years. Remember, they have no loyalties to the current government.
RRE3005 I think it's unfair to change the rules once the games started. Oil sand projects are long term ventures under increasing pressure from rising costs. Increasing the royalty from 25 to 33% + adding the proposed oil sand production tax. If the government decides an increase is indeed fair and will not cause a huge panic resulting in thousands of job losses, then I think the increase should be staged over a 8 year period - 1% increase a year perhaps up to 30%. This would probably make the Alberta/company 50/50.
RRE3006 About time we get our fair share. It is just stupid to let oil flow out of Alberta to be refined somewhere else! What are you thinking off? hey! Klein is gone---get real!! Further, we must have extra tax on any unrefined oil that ships out of our Province. The Company don't like it?/ Too bad--I am sure China will gladly pay and buy those company's'investment!!
RRE3007 The Alberta Royalty Review must be accepted in its entirety. This Report was drafted with honesty, an by a group who had supperior knowledge then any particular self interest entity. [Information Removed]
RRE3008 I don't understand why the Premier is stalling. Industry and the public already gave their thoughts... to the panel. The panel found that we are being short-changed, and royalty rates should be higher. What more do you want? Are you going to keep asking for opinions until you get the answer that you want to hear? In my opinion the recommendations put foreword by the panel are barely adequate to address the shortcomings in the royalty system and should be implemented immediately. Then we can have another go at deciding what a fair return on public resources is. I have very little faith that the conservative government is acting in the best interest of all Albertans. How can I when they are sponsored by the oil and gas industry? What do you do when you don't trust your government? Sincerely, [Information Removed]
RRE3009 I work in the oil and gas industry, but I do not share the view that the sky will fall if Alberta takes more revenue from oil and gas royalties. Oil companies are using fear tactics (much like political campaigns do) to try to make its employees and the public believe there will be huge economic downfalls for the province if these recommendations were to take effect. I skimmed throught the report and it seems pretty reasonable to me. The only thing I wish to add is that royalties should decrease as profitability of resources decline due to high operating costs. High royalty rates should not ever be the reason why resources are no longer produced. This will help ensure that resources are conserved and produced as long as possible. Premier Ed Stelmach needs to stand strong in the face of industry and public fear-mongering about the economic downfall of Alberta if Albertans get their "fair share." I do not see a little slowdown of the Alberta economy to be a bad thing; I think it will help stabilize inflation and give us controlled growth that maximizes Alberta's quality of life and the "Alberta Advantage." Kudos to the Stelmach government for recognizing that there should be a change in royalty caps and calculations!
RRE3010 What are they thinking; employment as hit a all time low and unployment is on the clime to an all time high.. The more they get the more they expect..what next
RRE3011 The entire province is entering a period of correction. Why risk turning the correction into a recession? If you leave things alone and things crash your family name wont be associated with it. If you mess with it and things fall apart... your family name will live on forever for all the wrong reasons.
RRE3012 I agree with this report, and believe that the government must take the recommendations and enact them. We cannot allow foreign investment to rob us blind of the natural resources without compensation. As companies want to be in a fair market so do we, the owners, of the resource. Whats go for the the goose is good for the gander.
RRE3013 I am truly amazed that our Government would even consider disrupting the main driver that has benefited Albertans - The Oil & Gas Business. The ripple effect on the province has the potential to be catastrophic, people do not realize that the Energy Industry benefits every sector of our economy - everyone will suffer from this. The only "gain" from this will be felt in BC, Saskatchewan, Newfoundland or the USA as oil field workers, engineers, management and most individuals tied to the industry will simply move elsewhere to work. This has the potential to be worse than the decision of the early 80's. I honestly don't believe most Albertans want to go through that era again. The Stelmach regime must use common sense when making this historic decision.
RRE3014 I agree with the royalty review panel having read the report. However, the extra revenue should be destined toward the savings fund as this resource belongs to our future generations and by saving now, our children will benefit. The economy is already overheated - perhaps the threats by big oil are in reality a blessing. Our infrastructure needs time to catch up, our citiizens need the ability to afford a home, and the research community needs time to address the environmental impact of this uncontrolled growth. If the predictions are correct, then the price of this finite resource will continue to rise and in time, the "poor economics" that the resource sector are claiming will no longer be valid and our future generations will again directly benefit at an even higher rate. In closing, I recall as a teen, the proposed Lougheed reforms toward the oil industry as well as the understanding of the value of saving towards the future. This brought about a wholesale change in government from the Social Credit Party at the time as most of the people of Alberta understood that the resource is ours (and in my mind, a portion of it belongs to the rest of our nation) and should not be exploited to the exclusive benefit of industry. Should this government ignore this report, I expect that history will repeat itself and a new group will lead our province. Thank you. [Information Removed].
RRE3015 I read the royalty review report. It's thorough work and the panel should be proud. There is a lot of controversy over the costs used to model economic rents. Please don't lose sight of the fact that many of the costs have increased because of rent-seeking by suppliers and employees. I saw a Bentley on the streets of Calgary the other day, that could be considered a producer "cost". Someone paid for it, out of the taxpayer's share. So, yeah, costs are higher than the report indicated, but only a portion of those high costs is because of global economic pressures. The rest is because some oil company president is spending my daughter's school funds on a new car. They might squawk, but I don't think that downgrading oil company managers from Bentleys to BMWs will mean all that much less investment in Alberta.
RRE3016 When one reads the report especially the, "How does Alberta Compare" section one can only come to one conclusion the increase suggested by the panel is fair and should be seen as a MINIMUM increase to be considered by the government. The oil industry, some government bureaucrats, and oil related industry leaders who are presently reaping the unprecedented windfalls of energy prices, can spew all the smoke and mirrors they want but the fact remains Albertans under the present system are badly compensated for our non-renewable resources. Thank God Premier Ed is prepared to stand up for Alberta and not continue to follow Klein's fiscal policies with the oil patch. Mr. Stelmach in my discussions with my immediate family and friends you should know we are all not prepared to accept one cent less than the recommendation of the panel. And yes, though we know it will not happen, would even welcome the industry suggested side effect of a slow down in development in our province.
RRE3017 When the oil industry threatens to cut investment, invite them to do so. We are failing to cope with the level of investment we currently attract. If Americans wish to obtain oil and gas from the Middle East in preference to Canada, by all means, let them do just that.
RRE3018 In the interests of our province, follow the recommendations and raise the royalty rates! Industry cannot be allowed to set the agenda - there should be no rush to extract our valuable resources at the lowest prices. [Information Removed]
RRE3019 Ok first off yes i do work for a Oil Company. so yes this will directly affect my life. If you go along with this reveiw you WILL LOOSE MY JOB FOR ME. have you actually thought about that 80% of alberta is directly or indirectly employed by the oil industry, its not the farmers or health industry that will keep me employed or 80% of the other people to its OIL. If you go through with this you will end up loosing 20 times the amount of money you think you will bring in plus have me on umemployment insurance. so if you dont really care about us and want to have loose my vote and repect for you for good then go through with it otherwise lets do the right thing and leave it as it is!!!!
RRE3020 I am a geological consultant working in the Alberta oilpatch. I do not diagree with Alberta wanting more of the royalty pie but I am concerned about how the panel arrived at their numbers. We need to compare apples to apples. That is to say we need to look at the economics of our gas business and not compare it to other locals where royalty schemes are different. Our gas business is unique and has unique costs associated with it's exploration and development. It costs more to do gas business in Alberta. And lets not forget that outside of the oilsands the vast majority of business in Alberta is gas. I urge the government to consider every angle and possibility before deciding on a royalty scheme. My business and my family depend on it.
RRE3021 I would like you to accept all the recommendations that was proposed in the royalty review report because Albertans deserve it. Even though I work in the mining industry designing equipment for Suncor, Syncrude, CNRL etc., which could affect me, I still feel it is necessary. I hate hearing of stories were daycares are being shut down and buses are late or don't arrive at all because of a lack of funding. Also, I would like to see the extra money (if implented) go to more schools in the growing communities and more leisure service facilties such as hockey rinks because I hate hearing that kids cannot play hockey because there is no ice time from shortage of rinks. The "golden goose" will not die!!!! They will not abandon projects it will only slow them down a bit which is needed. Also, CAPP says drilling for gas wells will drop one third from 22000 last year to 16000, so what, wasn't last year a record year?? Isn't the average around 13000-14000 wells a year before the boom??? Please implement all of the suggestions proposed in the report, these professionals were not lying when they wrote it.
RRE3022 The government has received ample feedback from the public since the review process was started. The vast majority of Albertans believe royalty rates are far too low and should be increased. This was also the conclusion of the review panel. There is no need for further discussion - please implement the report's recommendations immediately. Any further delays suggest that the government does not have the guts to stand up to the oil companies and get the best deal for the citizens of this province.
RRE3023 I read the royalty review report with a great deal of interest, as I was quite involved in this segment of the oil and gas industry during my career. It appears to me that the Committee did a thorough job and much more extensive than I had expected. Extend my “thanks you” to the individuals that contributed to the royalty review process. I agree with the conclusions stated in the report. The “Fair Value” conclusions are not surprising, with the price sensitive royalty formulas being capped at a price much lower than the current oil and gas prices and the over active focus on the Oil Sands. It was time for the “Fair Share” royalty review to take place. I encourage the Government of Alberta to take action by increasing the crown royalties to be more up to date with today’s economic times. If royalty increases cause a bit of a slow down in oil and gas activity, it could even be beneficial to Albertans as the oil and gas prices will likely continue to increase. Future recovery of oil and gas resources could yield a much better economic return than banking surplus dollars obtained via lower than “Fair Value” royalty rates. The inflating costs associated with an over active economy is causing hardships for many Albertans, who should really be sharing in the positive experiences from the windfall values associated with Alberta’s oil and gas resources. Thank you for the chance to comment on the important issue. A Life Time Resident of Alberta – [Information Removed] .
RRE3024 I think it is important for government to be careful and not kill the golden goose. Successful businesses in Alberta is what has allowed the province it's growth. When businesses are profitable that profit flows to the shareholders, employees and ultimately into the economy creating benefits for all. Let's not let a minority of people who think that the "rich oil companies should pay" slow down or destroy our great Alberta Economy. [Information Removed]
RRE3025 Good Morning I have been in the oil and gas industry since the age 20 and I am now 61. I have never been as concerned as I am now on what would happen to our industry should the government go thru with the royalty panel review. Although I work in the Land Department and do not totally understand the ins and outs of the financial end of the business, I know enough that if the royalty review goes thru it will hurt our young people as the business would come to a screaming halt on new projects. Is the government thinking about the future?? Did the government take into account the money it is going to take the industy in developing new technology to recover heavy oil/oil sands/cbm in place of the depleting conventional oil and gas. Did the government take into account how long certain wells would reach payout after paying crown royalties and after oerating costs. I think not. Also, if the government is not even receiving the royalties is should be getting at this point, who is at fault? Has the government personel and the oil and gas industry actually conversed about this matter? Thank you for reading this message.
RRE3026 Fair Share? that's ridicuous! 25% royalty is not a fair share? then 40%? 50%? if now the industry accept the royalty hike, who know if the royalty will rise again in a few years. may be when royalty reaches 100%, those guys feel fair finally! the review panel is selfish and devil!!!
RRE3027 I am a resident of Alberta and have been for 24 years. I am also directly employed in the oil & gas business. Over the last 24 years, I have seen many ups and downs in this business. Prior to the royalty review report, many indications were that the oil & gas business may be heading into another downturn due to reduced commodity prices (especially on the gas side), very high service and supply costs and continually increasing regulatory / environmental obligations. With the release of the royalty review report, a new hit to the oil & gas business is being contemplated. It is my sincere concern that, if the Province of Alberta were to enact the recommendations from this report, the "perfect storm" will be created that will plunge the oil and gas business in Alberta into a significant downturn that could be comparable to that seen in the days of the NEP in the early 1980s. Since the release of the report last week, I have been very surprised by the strong up swelling of concern voiced by so many in this business. I strongly encourage the Provincial Government to review the recommendations carefully and discuss the findings with the oil & gas business on a factual basis. Obviously, emotions and politics can run high on this issue but they need to be set aside to properly review the facts. I firmly believe that a detailed review of the facts will prove that the economics for oil & gas development in Alberta, especially on the conventional oil & gas side, are already tight and that any further erosion of the economics via higher royalties will result in the significant curtailment of future spending in this industry. Thank you in advance for your serious consideration of these issues. [Information Removed]
RRE3028 Don't srew up something that doesn't need fixing. I work for a small private Oil & Gas company. It's already hard enough to raise money with gas prices at an all time low and now you through this into the mix. We currentley need to raise more money for future exploration/drilling programs and finding investors will now be harder then ever. People are already weary of the oil & gas market via the extreme decine in stock prices. Also how can this royalty increase not be grandfather in. This change will completey obstruct the dinamics of our comany's current years forcast. The increase will effect our company dramatically becasue most of our wells are high impact. Maybe will have to just drill more in B.C? Can you say unemployment crisis in Alberta? What else do you want to get your hands on?
RRE3029 Royalties should be increased substantially for all past present and future oil and gas production in Alberta. Application of royalties should be made more transparent. Canadian citizens deserve more of the wealth generated by the exploitaion of our natural resources.
RRE3030 I am deeply concerned about the proposed changes to the Royalty program in Alberta recently brought forward by the report "Our Fair Share". I believe that by implementing the proposed changes, Alberta and Albertans will lose out in the long term. The majority of wells drilled in Alberta are gas wells and with the trust changes announced last Halloween combined with low gas prices, Alberta companies are already struggling to make a profit. Many Alberta families depend on the strength of the oil and gas industry for their livelihood, either directly or indirectly. I am also very concerned about the proposed idea to not grandfather existing oilsands contracts into the royalty changes. I refer you to [Information Removed]open letter to Premier Ed Stelmach and recent columns by [Information Removed]as well as warnings from the Canadian Association of Petroleum Producers, Tristone Capital, EnCana, FirstEnergy Peters & Co. Limited, all of who know more about the details surro! unding the present issue than I do. I urge you to heed their warnings, for the good of the province and us, its citizens. We in the oil and gas industry know that the royalty regime needs to be changed and updated. I just hope that cooler heads prevail and that any changes are thought through fully before being implemented. [Information Removed] Calgary, Alberta [Information Removed]
RRE3031 good idea if you are planning to make alberta cities ghost towns.
RRE3032 The result we all are seeking is a province where government’s future revenues are balanced by the need to support continued, robust industry investment. I beleive the proposed increases are going to hurt the oil and gas industry in Alberta to the point where investers will look to other oportunities in other countries there by costing Alberta jobs and financial security of its workers.
RRE3033 I believe that, considering the current state of small & junior oil companies and financial markets, that this is a poor time to change royalty regulations. Any funds gained will be lost in land sale revenue and in lost jobs - especially in the oilfield service industry.
RRE3034 Alberta citizens deserve their fair share of oil and gas revenues. Why is the government allowing multinationals and millionaires to profit while regular Albertans have to cover the costs of our suffering infrastructure and lacklustre social services? It's time to give Albertans a fair deal. Show us that the interests of the province and this country come BEFORE the interests of moguls and corporate entities. Raise the royalties. Let the oil companies leave. Someone will want our resources, and they will pay to get them, by providing benefits to the province, not just themselves.
RRE3035 Don't do it.
RRE3036 I urge you to consider the far reaching consequences 0f the royalty report if implemented as it stands now. Please do not be sucked in to the "look at the money those fat cat oil companies have made off of our backs" knee-jerk reactions that are currently washing through the media. Far more is on the line than the jobs of the oilpatch workers who will be the first to suffer the effects of a flawed report.
RRE3037 The Alberta government should immediately implement the full recommendations of the royalty review panel. We, the Alberta citizens have been shortchanged for too long. Stand up to the vocal and powerful oil and gas companies on behalf of all Albertans. The current proposals already are a compromise. [Information Removed]
RRE3038 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 06:01:18 DATE ENTERED {ts '2007-10-02 06:15:01'}
RRE3039 The benefits of continued growth and development of the oil and gas sector in Alberta through all of the owners, and associated businesses far exceed what could be gained through changing the royalty equations. If a "self imposed" slowdown in the oil and gas sector were to occur as a result of a change, it would cost the Alberta government as well as the citizens much more than the increased royalties would net. Any change of this nature would have to be done with a great deal of notice (15+ years) to allow owners to adjust to the change. Royalty changes a few years into a facility with a 50yr lifecycle is not something the owners could forsee or react to without a negative impact. Please contact me if you wish to discuss further.
RRE3040 Good Morming. I am very concerned about raising the Royalty Rate. Our oil industry is having a hard time, as costs are already high. These companies are not Making nearly as much profit as the general public are lead to believe. If royalty rates are raised more than 20 %, at this time, we will have the largest unemployment rate in Alberta history. It will be a financial disaster for all Alberta. I would like the government to have all their fact in order before making any changes. I want you to listen to the oil people in Calgary, as their exploration programs are far below last year, due to high cost and profits. I have worked in the oil industry for 45 yrs, and I feel they have , and will continue to build our provence. Please don't destroy the one Industry that is Alberta's head above water. [Information Removed]
RRE3041 I do not support the Royalty Panel recommendations. In my opinion, changes to the royalty and tax rates must consider Alberta's long-term future and balance against the risk and cost of developing our resources. Please work with the Energy Industry to increase the provincial funds in a collaborative manner. Thank you, [Information Removed]
RRE3042 Do not yield to pressure from the oil and gas companies and accept all the recommendations in the royalty report. [Information Removed]
RRE3043 As I review the numerous stories and articles over the past few weeks’ things are becoming very clear and support the panels review: • The panel contains experts from the industry. • The industry calls the panels information flawed but 2/3 of the informational input was from them. • The industry is making record profits as shown by their own annual reports to their shareholders not to mention the overly generous compensation packages to executives. • History shows every royalty increase is contentious with threats yet is finally accepted and life goes on with little disruption. • Market forces are driving explorations and slowdowns just look at the over abundance of gas supply in storage due to the past mild winter & cool summer. • If the review scares away the industry why then are countries such as China, Norway and Abu Dhabi buying our oil sands? We have it -They want it. World demand is on the rise and conventional supplies are dwindling. A slow down would be a good thing and here is why: • Industry complains of higher costs. Economics 101 –Supply & demand- All industry is fighting to get the ever dwindling supply of qualified workers. A slow down would maintain a more reasonable employment rate in the province. Other sectors of the provinces service and retail sectors would finally be able to hire available people. • Fort McMurray has been complaining for years of social economic and infrastructure issues. People living in garages, not enough doctors etc. A slow down would allow things to catch up and bring normalcy to the city • If this activity was spread out over a number of years instead of having the Gold Rush syndrome it would provide a much more stable work force and infrastructure to the Province. • Reducing activity would reduce the environmental impact- Carbon emissions being just one example. • Delaying or pacing projects would allow new technologies to be developed thereby reducing pollution and making extraction more efficient and cost effective. One just has to look at what has happened in just the last 10 years or so. • As Peter Lougheed says a slow down would help the province manage its own resources at a sustainable pace. The government is accountable to is “Provincial Shareholders” • Accounting transparency should be the order of the day. • Simplified reporting • Regular forensic accounting of the industry should be on a quarterly basis to ensure we are getting our Fair Share I am in favor of moving forward on the Royalty Review suggestions. [Information Removed]
RRE3044 Don't unbalance Alberta's economy. Save our jobs.
RRE3045 What do you plan on doing about the amount of job losses so far, plus the amount of people that will be out of work if you go ahead with such a large increase on royalties.
RRE3046 The oil industry in Alberta is currently suffering. It is becoming more expensive than ever and less profitable. If royalties are increased, there will be very little incentive for these companies to continue operating here. Many Albertans make their livelihood in the oil industry and will suffer greatly if this industry takes it's business elsewhere. Help Alberta by protecting the oil industry and DO NOT approve the royalty increase.
RRE3047 I will be writing to the Premier as well, but wish to express my concern through this website. I appreciate the time and care government is taking in this matter. There are many places on this planet, and within our country, where a report such as this would have been gripped as a political weapon to further the short-term interests of the governing party. Not here. That speaks to a strength of leadership. I moved to this province from elsewhere. I did so because I admired what Albertans have been able to build over the past number of years. The stresses of growth are apparent, but I view them as challenges to be addressed rather than avoided. My understanding was that Alberta realized that progress and prosperity were desirable and led to benefits for all. That government should not be viewed as the protector or generator of wealth and that leaving money in the economy for reinvestment was key to the Alberta Advantage. I have read this report, along with the commentaries of internationally respected firms. This is a poor report. I hope the Premier will be straight with Albertans on that point. It may say what many want to hear, but it does not speak the truth. I do not suggest improper motives to the panel members. The Premier has my respect and I have a great deal of empathy for his present situation. I hope elected officials return that empathy when they consider people like me, with mortgages the size of the moon requiring a strong and steady economy to feed. This report should not be accepted and leaders should speak the truth to Albertans. The oil and gas industry has not been ripping people off. The success enjoyed by this province is due in large measure to the 275,000 men and women that work for the industry. I am one of them. We should not be made to feel as traitors to our own. In conclusion, I also wish to express support for the people of the Energy department. I do not know them, but I do know the commitment of the civil service and the trials work within government brings. The treatment of the civil service by the panel and Auditor General was appalling. Again, I hope leaders will step forward to say thank you to the people that supported the panel and then silently endured a public slap in the face. It was unacceptable. I rarely write emails or letters to government and I never disclose how I intend to vote. Please know that my views on this matter are strong, and my anxiety high. Thank you for this opportunity. An Alberta Citizen
RRE3048 I was very concerned when I heard that the Alberta government might adopt the recommendations from the Royalty Review Panel as stated. I think a proper balanced analysis of the situation will show that if the government adopts the recommendations, then there will be far reaching negative impacts on the Alberta economy in the short and long term. This will affect the lives of many people living in Alberta including me, my family and my friends. I think the government of Alberta needs to take a step back and engage the key stakeholders, including appropriate representation of the oil and gas industry, in a meaningful discussion on how to develop a win-win-win solution (i.e. for government-industry-citizens of Albertans). If this not done, I fear this will cause Alberta's vibrant economy to go from "boom" to "bust" and I would not support any government that is the catalyst for this. As a tax paying residence of Alberta, I request that you exercise due diligence and revaluate all the options before making balanced decision that is best for most people in Alberta. I would like to know how the current government is going ensure the any action it takes as a result of the Royalty Review Panel is not going to negatively impact the majority of Albertans, who are supported by the Oil and Gas Industry. [Information Removed]
RRE3049 I have seen a marked increase in house listings, wells & projects get cancelled as well as received a 20% pay cut as a result of your royalty review report. Thank you very much?
RRE3050 i work in the oil industry, and i think they should pay higher royalty fee's due to the fact that oil is a non renewable resorse . when its gone trust me ,the investors,oil company's will be long gone....leaving a new generation of albertains to clean up the mess...lets get the royalties, so we can invest for the future of all albetians,and try and find new solutions for the future.i am sure if we raise the royalties, the oil companyies will try and prove a point by slowing exploration,but we have perservered before .....[ cuts to pay off our dept ]...and we will make it through again...knowing that its not the past, but the future we have to look out for...............thank you[Information Removed]
RRE3051 Sir, As an oilfiled worker of 12 years, I do not understand why you would choose now to go after these companies for more money. If production slows, I will lose my job, my house, my investments-my entire way of life. In one of your articles it states that these new royalties will benefit Albertans for years to come. My question is how is it going to benefit my family right now? I have already lost 1 home caused by the oilfield "slowing down" I do not wish to lose another. I don't belive you have the "average Albertan" in mind. I believe you have your own interest and those of big business that will in the end somehow benefit YOU. Why would you try to damage this economy. Why would you try to steal what my wife and I have already worked so hard to build? Show me how these royalties would benefit Albertans.I'm not asking how this would benefit the east, or how that would help YOU and YOUR party in the next election. Mr.Premier, I honestly belive that you are way too far removed from the "average Albertan" to even make a decision like this for our province. Let's have a vote on it, inside our province only, and then you would see exactly what us "average Albertans" think of this idea. I am against your royalty plan, everyone I talk to is against your plan. how is this moving forward? If you want to bankrupt my family and thousands more just like me, then go ahead. You will become the most hated Albertan in our amazing history. [Information Removed]
RRE3052 Dear Mr. Premier, While I'm sure this email will never reach your desk, i'm hopeful that my views and opinions in this email will be considered by your panel of policy makers as you arrive at a decision to the recent Royalty Review. As a concerned citizen of Alberta, i respectfully urge you to exercise common logic when you are faced with arguments from both sides. My reasoning is as follows: - While it is easy for Albertans who don't work in the energy sector to criticize the big bad O&G 'fat cats' for making so much money off of Alberta's resources and giving so little back, they should consider that there is a considerable amount of risk that stakeholders put into developing these resources. People fail to take this into consideration when making statements like the above. The theme of the Alberta Royalty Review is "Our (Albertan's) Fair Share. My question is... what is so fair about the gov't punishing an entity who has profited from assuming great risk, by arbitrarily increasing the royalties? Is anyone sympathetic to energy companies when they drill unsuccessful wells, or when oil & gas commodity prices hit rock bottom? Companies of the O&G industry, just like companies in any other industry has a right to enjoy the fruits of their labor without being punished by the gov't. - if you are an Albertan, regardless of what your occupation is, the chances are that in the last several years, you have benefited from Alberta's booming economy which is driven largely by the oil and gas sector. while these amounts may not always be obvious, they are certainly there. examples include increased wages, increased funding in education, medicare, municipality development, increase in property value, money handed out by the gov't (energy rebate cheques from last year), etc. The point is that if people haven't realized how much the oil and gas sector has benefited this economy in the recent years, the chances are that they won't realize the benefits even if the royalties are increased (in the unlikely event the the gov't does succeed in creating more revenue from the energy sector should this royalty increase take place) . - a 5-17% royalty increase on severely decreased chunk of investment capital by companies will most likely result in a decline in government royalty revenue. As you are aware, several big name players in the industry including EnCana, Talisman, ConocoPhillips, CNRL, among others have announced plans to cut project budgets drastically if this royalty increase is approved. if you who feel that these companies are bluffing, you should know that corporations value their integrity and I don't feel that they would risk their credibility with the public by throwing empty threats at the gov't. - Aside from the lost revenue that the gov't will have to absorb, if this royalty regime is approved, Alberta will also face a widespread umemployment crisis, something this province has not seen in more than a decade. The lack of employment will not be resticted to the oil and gas industry, but all businesses across Alberta will be impacted due to the trickle down effect caused by a general decrease in spending by all. Sound familar? yes this is a defining characteristic of a STRUGGLING ECONOMY. In summary, i think the gov't needs to consider whether this Royalty Review is truly based on fair compensation to all Albertans or whether this is based on appeasing those who don't support the Alberta O&G sector. If this debate is based on the former, then i feel that the O&G sector has paid more than its fair share to Alberta considering the job creation, market stimulation, royalties paid, land sale bonuses (approx. $3 billion dollars in 2006) and countless other intangible advantages. I firmly believe that the general public needs to be re-educated about what corporations do for this province and perhaps then, they may understand that they have been receiving their fair share.
RRE3053 The Provincial Government's recent decision for a Royalty review seems very short-sighted. Although big oil and gas companies have had very good revenues in recent years they are now experiencing a slowdown and would be very negatively impacted with the proposed 20% increase in revenues. This would most certainly hurt those companies that have made Alberta so prosperous in recent years. My concern is for the employees of the big and small energy companies and all the service companies that depend on their business. I believe it is vital for the government to slow down and fully understand the consequences of their actions prior to implementing these changes. We all remember the NEP of the 80's and the devastating impact it had on our economy. Let's not repeat that mistake. Concerned. [Information Removed]
RRE3054 There is no amount of royalty large enough to allow the continuation of the unreparable destruction, damage, and devastation oil extraction is immediately causing the earth, water, wild life, and plant life; let alone the ongoing and future repercutions of this industry throughout our province and the world. Please stop this.
RRE3055 I would like to provide feedback : strongly support royalty review report
RRE3056 My name is [Information Removed], I am a small sub contractor [Information Removed]. I moved to Alberta from BC over 6 years ago in hopes of a better future and the promise of a strong economy in which I would be able to thrive and lead a better life. I the past 6 years I have managed to go from a labourer to a supervisor, from renting to owning a home, as well as being able to afford to travel and buy things i never thought possible prior to moving to Alberta and for all of this I am very thankful and therefore proud to have become an Albertan. As of late things in my field are becoming very scary due to this outrageous proposal, I know myself that "stressed out" is an understatement for how myself and a very large group in my town and industry are feeling. The economy in Alberta is already slowing down due to the recent spike in our dollar and a large portion of the oil and gas industry being american, maybe this should be shelved until a more suitable economic time. I hope everyone else in my situation isn't just sitting at home afraid to speak their mind, and more so that these proposed actions are shelved, if not I would like to leave you with the title to my property and the rest of the items I have financed one I'm forced to file for bankruptcy at 26yrs old.
RRE3057 Our thoughts and feedback on the Royalty Review Report As seen by the directly effected. You always hear concerns about what the Oil & Gas industry did to the housing market and how there is a housing crisis, again caused by the Industry. However, did you hear about how Oil & Gas contributed to a 15 Billion dollar Heritage Fund? Did you hear what the Oil & Gas Industry has done for Alberta and local communities? In my opinion the bottom line is the Provincial Government is upset about the losses of Royalties due to the increasing dollar. During the last election there was extensive media coverage regarding Affordable Housing and the Recycling Program, however where was the Media coverage of the potential “bomb” that is about to be dropped on Alberta and cause mass destruction? All because of the Government is looking for a solution. If the Government puts forth this increase, this may cause many Albertan’s to have to go bankrupt which may cause a lot of mental/emotional stress on people, families, marriages, children and the general health of the directly effected. However, many will be affected because most live in a financially extended society and these homes, toys, vehicles etc. will end up going back to the banks and these monies owing on them are higher than the values itself. The banks will have to compensate for their losses which will result in an increase of interest and in turn drive up payments. Thus again may result in more people being unable to provide for their families and keep a roof over their heads. Some people may have insurance to cover financial loss or if in-turn life insurance, might be required to be paid out, due to extreme stresses, that too will then cause insurances to increase. Have we even touched on the full extent of the mushroom effect of what will happen? There is 30 billion dollars in reserve, stop looking for a short term solution for the increase of the Canadian Dollar. Every increase of .01 cent = 1 Billion dollars of lost Royalties. Albertan’s should not have to pay for a prosperous Canadian dollar. Idea: What about an Oil & Gas Alberta Infrastructure Program to support the housing issue crisis fund? 1. Loan 5 Billion to “the Fund” from the Heritage Fund; 2. Oil & Gas “the Fund” to repay within 1-2 years; 3. This gives 1-2 years to re-access Royalties with proper knowledge; 4. How you disburse “the Fund”, TBA. This way it would be a win, win, win, win situation all around. In conclusion there is 30 Billion dollars in Alberta savings. This I imagine is called the “Rainy Day Fund” if you proceed with the current review recommendations……. ……………………………………WELL ALBERTA??????????????? WHERE IS THE ARK!!!!! (translation: cause it is gonna pour) Please put a freeze on the devastating destructive proposal and hire a new panel with industry knowledge and start over.
RRE3058 I think the report should be implemented as a whole. It is about time that the Goverment of Alberta gets on side with the people of Alberta instead of catering to the interests of big oil companies.
RRE3059 Hi. My name is [Information Removed]. I live in Calgary. I [Information Removed]worked in the oil industry for 13 years. I now work in the non-profit sector helping families going through separation and divorce. I don't have time to read the entire report, so I'm not as informed as I'd like to be on this enormously important issue, but I have looked through the report and read parts of it. It's my understanding Premier Ed Stelmach initiated the royalty review and I thank him for that. I read the information on each of the panel members, and individually and collectively, it appears to be an excellent panel. I am certainly in no position to challenge, question, or second-guess their recommendations, and I suspect that the premier and energy minister do not have the expertise to do so either. In the September 25, 2007 news release, Premier Stelmach was quoted as saying, "We understand the importance of stability and certainty for industry, and the importance of maintaining competitive fiscal and regulatory regimes," said Premier Stelmach. "We also understand that Albertans expect to receive long-term benefits from Alberta's energy resources. Our response will balance these perspectives." From what I've heard and the parts of the report that I read, it appears to me that the panel already went to great lengths to balance these perspectives. If Premier Stelmach and the government choose to deviate from the panel's recommendations, those deviations will need to be very, very well supported. I want a government that appoints highly qualified, balanced, non-partisan panels to provide recommendations on complex issues, and then promptly impliments those recommendations. You're half way there and your next step will be the single defining thing for me at the next election. Drop the ball here and I'll move my vote to the party that I think might be willing to appoint good panels and then promptly implement the recommendations. Sincerely, [Information Removed]
RRE3060 I am not associated in anyway with the oil and gas industry, but I feel I have to let you know what I think of this Governments plans to increase royalties. This Government is now flush with money, and has a hard time spending all the money that they have taxed out of just about everything you could possibly think of without giving anything back to the people of the Alberta. Now, because of just pure greed, someone came up with the idea we should try and grab more money from the oil and gas industry by increasing Royalties. I would like to know who the bonehead is who came up with this cash cow? Since announcing the proposed plan to increase royalties, all of the energy stocks on the TSX have taken huge drops, and many huge companies that employ thousands of people, are cutting back on their budgets,threatened to pull out of Alberta, and literally thrown the whole industry into turmoil. LOOK AT ALL THE HUGE SURPLUSES THIS PROVINCE HAS SEEN IN THE PAST 10 YEARS, AND TELL ME WHY THIS GOVERNMENT FEELS IT IS NOT ENOUGH. I think its time for a change of Government, and cannot wait for the next election so we all can show this current Government what we think of them. I have never voted Liberal in the past, but I can guarantee they will have my vote in the next election. This Government is nothing more than a cash grabbing, money hungry, self centered group of individuals who have worn blinders for far to long, and needs to be voted out of office. I will do everything I can to try and make this a reality come election time. [Information Removed] Spruce Grove, Alberta
RRE3061 I am concerned about the good possibility that implementing the proposed changes will put the Alberta economy into decline and result in lower energy industry activity, lower property values, lower emplyment levels, lower income tax collected by the province resulting in lower infrastructure spending by the government. I have a special-needs child that requires a high standard and level of care that we have enjoyed in Alberta for the past several years. I am concerned for my job, my value of the house relative to the mortgage, and the possibility that the royalty changes may force my family to move to another province where the cost of living is cheaper, but the special-needs hospitals for kids may not be as good. I prefer that the premier leave the royalty rates unchanged and let industry continue to spend that 2 billion dollars into the economy where the citizens will benefit the most from re-investing in the AB economy.
RRE3062 Alberta has been undergoing an unprecedented march of prosperity and growth over the past few years, benefiting both the government and the citizens. Why try to fix this situation if it's not broken? There is a lot of fear in the eyes of the people who work or support the oil industry. Whatever is done should be done quickly before panic results.
RRE3063 I am the Quality Manager for [Information Removed]. and we employe over 150 people who work to provide safety services to the oil industry. Any slowdown by the major oil companies affects our personnel immediately. If the current oil royalty structure is changed to the format currently recommended, the oil companies are stating that we will experience a slow down of a magnitude not seen in this industry for years. I want you, the representatives of the people, to realize that this will be a fact if you don't listen to the concerns that the oil companies expressing. [Information Removed] does not want to be put in the position of having to terminate good people, the same voters who put you into office, because of what boils down to a huge oil industry tax increase generated by the current government of this province.
RRE3064 Please leave the royalties alone. I believe the government and the people of Alberta are currently receinving their"fair share"
RRE3065 I understand that the oil companies will make less money and therefore have less to invest, HOWEVER under the current scenario the balance of investment is way out of balance. Investment is being made into further development of resources that do benefit Albertans through royalties and taxes, as well as companies who make those investments through increased or sustained production (and thus cashlfow). But the investments many other areas of sustainable growth is lacking - investments in communites through infrastructure to support the increased development is far lagging. We do not see the resource companies stepping up to build much needed roads, hosptials, and schools, not to mention services to support the communities. The government not only needs the revenue to provide these services, but we also need to be thinking about the future generations who are not DIRECTLY benefitting from this rapid expoloitation of the resources. A very relevant saying by a first nations elder that goes something like; think not that we are inheriting the earth (and it's resources) from our ansectors, but that we are borrowing it from our descendants. I support some increase if royalties on oil and gas, that balances the cost of production relative to the extraction rate (some decrease in royalties as suggested for lower rate wells is appropriate), with the price. Thanks [Information Removed]
RRE3066 I want to say that I fully support the Panel's recommendation to increase royalty rates...I believe this is a great opportunity to benefit from the good fortune this province has been afforded thanks to a bounty of natural resources. I hope the government does not cave in to industry pressure, because the province holds the leverage here, don't forget that. Oil and gas companies need Alberta more than the province needs them; where else will they go? They will not leave if rates are raised, I believe, because our massive energy deposits are not going anywhere and Alberta remains a stable investment region, politically, financially and socially. The oil and gas industry is simply looking out for their best interest, which is understanable, however it also does not mean all of their doom and gloom scenarios would come true either. I believe the Panel was fair and did their homework, so I trust that they struck the right balance between the province benefiting from oil while maintaining a great economy. We must receive more for our resources; it is embarrassing to read that most other jurisdictions receive more than this great province. Lastly, in response to the argument that the government should not interfere in the market; with royalty rates currently so artificially low, the government is already interfering in the market. Abnormally low royalty rates are essentially a form of subsidy. The boom being experienced in Fort McMurray and elsewhere is proof that rates are too low; the mad scramble to develop up there stems from the fact that profit margins here are relatively higher than many other jurisdictions. Raising them slightly may decrease revenues in the short-term, however it will ensure a longer stream of revenues over the medium- and long- term, and will give regions such as the RMWB a better chance to catch up and grow at a more comfortable, sustainable pace. Thank you for assembling the Panel and reading my long piece of input! We only get one chance to make the most of our good fortune, we can't just give it away to a small few; make this right, and let all Albertans (today and those in the future) benefit. Thank you, [Information Removed]
RRE3067 I read the report. Its conclusions are reasonable. The industry submitted little information, and recommended van Meurs as a way to compare. They don't like the updated van Meurs but can hardly be surprised at the result.
RRE3068 History is repeating, the last time the oil companies went else whare you couldent get a job. I dident see the government helping them out when oil was at $40/barrel. This is what is making Alberta boom, I think that the government is making alot of surplus now lets not get greedy.
RRE3069 The Government of Alberta has a tremendous responsibility to the citizens of the Province. These include but are not limited to: 1. ensuring a stable, efficicient, legal and regulatory environment; 2. ensuring proper infrastructure and services are in place to support the economic prospects of the Province; 3. recognizing that the Alberta Advantage starts with a free market economy, less Government and lower taxes. The Royalty Review panel had none of those responsibilities. As a matter of fact, they as much state that they did not consider them. The panel ignored basic information that was supplied to them by industry, information that is in the general public domain, and the panel unbelievably ignored basic principles of investment, risk, and legal fairness. The report simply lacks credibility at any level as an instrument for the government to rely on, unless it too wishes to ignore its responsibilities to its citizens. Your Government - in which I include previous administrations, was warned for years regarding the need for and the pressures that the Alberta Economy would be facing especially in the oil sands area - yet chose to ignore to take proactive steps. It is shameful politics that this Government now seeks to shift responsibility for these strains to its citizens and those free market participants who have invested in Alberta. Ours is an integrated economy - not a third world economy. Our citizens work in, have investments in, and have pensions plans which are invested in energy companies and supporting businesses - everything from steel to furniture to computers to oil field service companies - this applies right across Canada. Increasing government take is not free. It removes the value from these companies, which in turn will effect jobs and investment, which will diminish everything from property values to financial investments. Surely the Government of Alberta is not so naive as to implement anything without fully understanding the macro-economic effects it is about to unleash. It is true that as commodity prices increase there is an opportunity for higher Government take - but government take must be in context of the economics of the industry. What seems to be lost in the debate is that the energy industry is a cyclical commodity based business with a significant risk profile. Long forgotten are the downturns when the economy rapidly contracts displacing workers and destroying capital employed. To attract capital / investors, there must be a return on capital commensurate with that risk. Royalty structures which reduce revenues prior to profit are punitive and discourage investment becasue they are not sensitive to market movements. For Alberta to attract the investment required to develop its remaining high cost resource, the incentive must remain to achieve a quicker payout, after which investors would be kept whole even if stronger commodity prices prevailed and higher takes were made on an after profits basis. In Albert we have always prided ourselves on hard work and an entrepreneurial spirit. We seem to have lost our principled way in the never ending grab for something that appears free. If our citizens were attacked as to his or her basic expectations to live and work in Alberta as the report does to the energy industry, there would undoubtedly be civil unrest. Indeed, the energy industry is apparently made out to be some faceless, uncaring entity. In fact however, it is made up of the very citizens the govenment believes it is trying to protect.
RRE3070 As a very concerned Alberta Citizen, I thank you for the opportunity to share my opinion about this Royalty Review. I was born and raised in Calgary and am proud to be able to work in the Oil & Gas industry as an employee of [Information Removed]. I am very concerned that the implementation of the Royalty Review will negatively impact my job, my family and my province! I don’t believe the review provides a balance between what is fair for the Province and what will work economically. If the impact on the Oil and Gas industry causes the companies to move their investments out of Alberta then how many Alberta families will be impacted by job loss. So many families in Alberta are affected by the Oil & Gas industry? Please consider all of the supply companies and industry / construction companies, all the maintenance companies, what about of the cleaning companies and technology companies. Every Alberta family will be impacted if the money to invest in Alberta projects is turned elsewhere. We have already seen the Oil & Gas companies shift their focus in 2006 / 2007 away from conventional drilling because the cost was not effective to purchase / rent from the supply companies. We have already heard the impact statement from Encana to remove a third of their Alberta investment dollars. Our company is able to adapt to the market however I don’t want to see them have to adapt to projects outside of Alberta. Thank you for listening to the concerns of the people of Alberta. Please continue to work with the Industry to arrive at decisions that will work for everyone! Sincerely, [Information Removed]
RRE3071 Albertans own 100% of the resource and the royalties paid by oil companies should reflect that. The royalty regime that made sense when the profitability of the oil sands was still largely unknown no longer applies and should be substantially revised.
RRE3072 I do not beleive that a freeholder lease holder should have the tax up to 100%. The tax should be abolished for the mineral lease holder for oil and gas. I would like to my comment on Encana trying to take the royalties away form lease holders of CBM gas.The alberta goverment pride itself as goverment for the people of alberta so stand up for us instead of big oil companies.
RRE3073 You have lots of messages to read. I believe you will find this one worth considering. If you mind is already made up, watch out. Please give serious open consideration to at least one more view. It is still within your power to choose. My prayer for you will be open to listen without prejudice, discernment of truth from lies, courage to do what is right even if it is counter to the prevailing popular view, and make choices that looking back from 10 years out will be determined to have been wise ones. Undoubtedly there have been significant changes in Alberta's Energy Industry since the current royalty structure was designed. Capital and operating costs have increased, commodity prices have increased, infrastructure options to market gas and oil have been built, while size or new pools and production rates have fallen. And we all understand that oil and gas prices are a roller coaster ride, cycling up and down sometimes very quickly and sometimes more steadily. We are living in an interesting time in Alberta where high oil and recently (not currently) highl natural gas prices have driven up activity to historic levels in all facets of the economy. That's been a positive experience for many Albertans. It's been less desireable for others. And the overall sense that I get is that the pace of activity has been unsustainable and inefficient in most sectors and most regions, but clearly not all. Please consider consequences that I anticipate will occure if the proposed royalty methodology and changes are adopted: 1. If implemented, ti will send a "sunami style" shock wave through the economy like hasn't been seen in over two decades. The first impact is that oil and gas activity across the board will drop by 30-40% as economics for projects simply will no longer attract investment. This will drive down labor and materials cost eventually, following a reduction in work force and spending. It will rapidly trickle through the economy driving down property values, spiking mortgage defaults and bankruptsy. There will be widespread disillusion and some may even try to blame the energy companies for doing this. And then even more mistakes will likely be made to further punish them. A deeper wedge will be driven between government and industry along with a demand by the public to politicians to fix it and get their jobs, savings, and homes back. Politicians will likley be unwilling to take responsibility for a poor policy decision, but will instead point to industry as the cause of the new problem. The politicians may even suggest taking over the resources to develop as national assets, to invest and create jobs. And at that point, it may take that because only the provincial and federal governments will have the economic incentive to invest. And that will result in the tragic loss of the true Alberta Advvantage, the loss of entreprenureal risk takers engaged in persistent invovation and profitable development. The entreprenuers will be at risk of extirpation. 2.. On a more practical note, natural gas has been the big driver fo activity, royalty, and land sale revenues. With low natural gas prices, elimination of the income trust tax advantage, and now both increased royalties plus eliminated deep gas holidays, the natural gas development is simply going to be stifled in Alberta. The gas will come to North America, but by LNG tanker, instead of from Alberta. Natural gas is the commodity that is the most volitale in the world. More thinking and scenerio tesing need to be done to develop a royalty structure that aims more of the profit during high spikes in natural gas price to government, while protecting producers during downturns and incentivizing deep pool exploration and development. Activity is already way down in the conventional gas side of the business. This willl snuff out the smoldering wick in broad regions/categories of natural gas drilling. 3. A longer term projection that I anticipate is that entreprenuers and even large corporstions with high percentages of Canadians in leadership/management positions will sell out of devalued companies to foreign investors from oil rich countries of the middle east. I cannot say how that will benefit or harm Alberta. It will change much around Alberta, including the political leaders and priorities. 4. Alberta's integrity towards oil and gas investors is in jeopardy as well. Please read this and reflect on how any future investor will have to make economic assumptions that assume the Alberta government will either choose to increase its take or to prematurely expire a lease in the future. To the extent that this report is adopted, Albertans will see lower land sale prices going forward and a higher threshold rate of return for any investment because of the higher fiscal risks. Please proceed with your eyes wide open and don't dismiss these above thoughts. This is not going to be a small smooth soft landing as is being forecasted. And I don't believe it is going to make Albertan's wealthier in the process. I do believe that a change is in order. This however is not the approach. A lot is at stake here. Take time to get it right. Regards, [Information Removed] The poplular bias is to not trust the energy companies. I suggest you listen to them. And if you choose to not listen to them, be prepared to hear a lot of "I told you so's" for a long time.
RRE3074 I fail to see how what is being proposed would be in the best interests of albertans. I have a question for the panel; do you honestly think an increase of 2 billion dollars in revenues will even cover the unemployment insurance needed to be paid out when thousands of people are unemployed because of this? With major oil and gas company drilling less wells because fewer are viable an increase of 2 billion dollars a year if production remains the same is very unrealistic. If the oil and gas sector in this province starts to suffer so will all other sectors because of the shear number of people employed in the oil and gas sector, they are the customers at our retail stores, the home buyers and the new people moving to our province. The report reads like albertans are getting less than the companies but you must take into account that many albertans are earning an income from these companies in addition.Yes we need change and an increase for albertans but what is being asked for is too much and this should be a negotiation between the province and the companies.
RRE3075 Do NOT accept the Royalty Review Panel
RRE3076 Follow Petro-Canada's recommendations. They make the most sense. To accept the flaws within the Royalty Review Panel's Report is just plain stupid.
RRE3077 Dear Sir or Madam, As a long-time resident of the Province of Alberta I am writing to list certain concerns I have with respect to the Alberta Royalty Review Panel Report (the “Report”) currently being considered by the Government of Alberta. Please consider the following: Transition Pains If the Government accepts the Report in its entirety without any consideration to mitigation, transitioning or phasing-in it will significantly chill the oil and gas industry in the Province of Alberta. There is no dispute that the oil and gas industry needs a measured slowdown in order to control escalating costs and inefficiencies; however, the approach proposed in the Report has the potential to cause significant transition pains with potentially adverse long-term effects. In essence, implementing the Report as a whole over a short timeframe will precipitate significant restructuring in the oil and gas industry (both for producers and service providers alike) over the short to mid-term but which may also potentially damage the industry over the long-term. The costs to Albertans will be significantly greater than the potential gains while the competitiveness of Canadian oil and gas producers will be diminished thus opening the doors of opportunity to a select few foreign oil majors and state owned oil entities having access to assets and capital which greatly exceed what is available to their Canadian counterparts. Faulty Assumptions The Report applies a number of assumptions which do not accurately reflect the status of the oil and gas industry. One key criticism is that the cost data used in the Report is nearly 2 years old; however, and more importantly, the notion that accurate comparisons can be made with other jurisdictions has serious flaws. For instance, when we compare operating cost structures, tax structures, physical access resources, costs of labour, materials, etc., in Canada against jurisdictions in the Middle East it is easy to conclude they are completely dissimilar. For instance, jurisdictions like Saudi Arabia and the UAE have plentiful access to affordable labour from South Asia (i.e., India, Pakistan, Nepal, the Philippines, etc.) which is coupled with industry favorable regulatory and operating environments where Occupational Health and Safety and Environmental requirements are very relaxed at best. I do not believe we can make accurate comparisons with jurisdictions where it is easy to find labour to perform services at $5 per day in extreme heat and living in squalid work camps. I can attest personally to these facts having lived and worked in Qatar and Saudi Arabia for nearly 5 years and having befriended some of the lowest paid expatriate workers in those countries. Conversely, we are unable to find tradespeople in Alberta to perform similar services for $30 per hour in reasonably clean and safe working and living conditions. I believe it is safe to say that we cannot simply compare the so-called ‘government take’ between various jurisdictions without considering the complete picture in each jurisdiction. The Panel Another concern on the Report is with respect to the panel participants. The distinct lack of specific industry experience and almost complete lack of participants from relevant oil and gas sector companies and governmental royalty administration bodies is a significant shortcoming. Involving participants from other sectors is relevant and provides a fresh perspective; however, it is important to involve participants that have specific experience in the implementation of royalties in an industry context in order to understand precisely how government and industry react to such matters. For instance, it is not possible to consider the issue in a vacuum separate and distinct from other taxes, operating costs, exploration and development regimes, financing programs, etc., all of which are relevant to government and industry alike. Who Gets Hurt? The Report, and the overwhelming public sentiment, seems to imply that cash flush oil and gas exploration and producing companies would bear the impact of any proposed royalty increase. This is clearly incorrect, particularly over the short to mid-term timeframe. Increasing the cost of doing business in any industry by even 5 – 10% over a short period of time may seem to be a modest and acceptable increase; however, the fact is that it will hurt producers and service providers alike. In short, in order for industry to react to such an the increase it will have to slow down or even freeze programs over the short to mid-term period until it is better able to consider the long-term ramifications of the applicable royalties. The greater the increase the greater the likelihood of employee lay-offs, cut backs in production, exploration and development programs, restructuring of assets and debt, and, importantly, reduced need for support services. The list of service providers that support the oil and gas industry is literally endless including truckers, tradespeople in all areas of expertise, drillers, forest industry workers, garbage haulers, food and lodging providers, excavators, safety providers, etc. Many service providers have incurred significant debt loads in order to acquire the staff and resources they assumed would be required to service a strong oil and gas sector. If the Report is implemented in full it is reasonable to conclude that thousands of those contractors, both big and small, will be unable to service their debt which will lead to a deluge of defaults, repossession and liquidation. This is not to speak to the individual Albertans that risk becoming unemployed and consequently unable to service payments on their personal property and real estate. Moreover, Albertans should expect an inevitable increase in crime if an economic downturn occurs. Big Players and Capital Flight One of the advantages of the Canadian oil and gas industry is that it still facilitates “home grown” Alberta oil and gas exploration and production entities to flourish. This is true for all players from individual wildcatters to major corporations and trust structured entities. If the Report is implemented over a short timeframe this will invariably increase M&A / A&D activity in the oil and gas sector; however, this will likely benefit large offshore entities since Albertan/Canadian players will be unable to restructure their assets and debt bases quickly enough in order to remain competitive with their foreign counterparts. In particular, oil sands projects are by their nature very capital intensive. Canadian entities are specifically disadvantaged for those projects since they will be unable to secure debt and equity financing that can compete with assets and capital available to US and European oil majors (i.e., Exxon or Total) or with state owned oil companies (i.e., Abu Dhabi National Oil Company or its subsidiary ‘TAQA’ or the Chinese National Offshore Oil Company (CNOOC) to name a few). Those foreign oil players can effectively secure assets with lower rates of return over longer periods of time and it is reasonable to conclude that they will be in the best position to further expand their diverse asset bases by purchasing reasonably priced assets from failing Alberta oil companies. It seems unreasonable that Canadian companies need to fall prey to foreign entities or that Alberta based assets and revenues should be encouraged to leave the country. The matter is even more galling when we consider that foreign state owned oil companies might own such resources in Alberta although there is no reciprocating right for Albertans to own, acquire or dispose of similar resources in those jurisdictions. This is certainly the case for Middle Eastern state owned oil companies which are owned by and generate revenues for the hierarchical monarchies ruling those countries. Other Revenues Diminished The Report assumes that the net benefit to the residents of Alberta will be in the range of $2 billion per year. Superficially this might seem correct, however, it falsely assumes that all other factors will remain equal. The Report’s proponents believe that the revised royalties will give the Province a bigger slice of a large pie. There is significant and warranted criticism that the outcome will actually be a bigger slice of a smaller pie. The perspective of industry is simple, active markets for goods and services produce positive cash flows. The Government’s perspective is different, however, since its aggregate revenue does not only come from royalties but also in other forms such as land sales, corporate and personal income taxes (both Federal and Provincial), GST revenue, municipal/county taxes, regulatory fees and permits, registration fees and levies, etc. In principle it would seem that the aggregate benefit of increased royalties to Government should at least be equal to or exceed what could be obtained under the current royalty regime. This, unfortunately, is not readily apparent, either explicitly or implicitly, in the Report so it is reasonable to argue that the net benefit to the Province could be less if a royalty increase is imposed hastily over the short to mid-term timeframe. The ‘Third’ New Tax The oil and gas industry is still in the process of reacting to 2 other significant developments, namely: (i) the imposition of a revised taxation scheme on income/royalty trusts, and (ii) the inevitable imposition of greater financial accountability for greenhouse gas emissions and clean air requirements. By significantly increasing royalties now the Government will have imposed a third new tax on the oil and gas industry over a period of less than one year. This type of ‘triple whammy’ not only decreases confidence in the investment climate in Alberta but it also forces industry to step back and reassess its projects and, quite reasonably, restructure in order to apply new metrics to those projects. The conceivable outcome (as I have mentioned above) is that industry will simply sell off the assets or undergo painful short to mid-term transitioning that will invariably hurt producers, service providers and ordinary working Albertans. Unpredictable Windfall One consideration that is being overlooked is that the oil and gas industry is currently experiencing an unprecedented windfall in prices. Since 2004 there has been considerable volatility in the oil and gas markets with extreme price fluctuations occurring for those commodities. During that time, natural gas hit all time highs only to retreat to current lows that have caused producers to significantly withdraw proposed exploration and production programs while also further hurting the profitability and viability of natural gas service providers. Oil has clearly seen significant and dramatic increases in value but has steadily stayed within the $40 to $80/barrel range during the same timeframe. This price boom is in part the result of increased demand but is also largely attributable to unpredictable geopolitical pressures. Any analyst of market fluctuations would be remiss, however, if he/she did not also consider the severe depressions in the oil prices that occurred in 1999 when it was trading in the $11/barrel range. In short, oil and gas, like wheat, metals or any other commodity, is subject to price fluctuations based on global pressures that are not squarely under the control of the Alberta oil and gas industry. It is therefore impossible to predict how long prices will stay high. Although the industry stands to benefit from recent windfalls in pricing it has simultaneously invested significant sums into projects (particularly oil sands) while also incurring rapid escalations in costs with a view to bringing projects on-line as soon as possible. An additional cost shock, like a rapid increase in royalties, will only add to the pressure by forcing industry to reassess investment objectives and returns. The pressures will only be further exacerbated and the boom will, of course, be very short lived if even moderate increases to royalties are coupled with a retreat in the price of oil. * * * * * As the Honourable Premier has mentioned, cooler heads must prevail over the consideration of the Report. It is my fondest hope that the Government of Alberta will reject the Report with a view to revisiting the issue with a more sensible phased in approach that will preserve the interests of Albertans and the viability of Canadian oil and gas entities rather than ‘outsourcing’ this necessary and finite resource.
RRE3078 I have worked as a supplier for an alberta manufacturer in heavy industry, oil and gas and with service and drilling companies for 26 years. I also am a supplier to the oilsands industry as are most manufacturers in alberta. The oil , heavy oil, and natural gas industry cannot take too large of a hit, if any, from our own government with regards to royalties. Here is why.I see it and deal with it everyday. For the past 10 to 12 months, drilling and service companies are running at 50 % or less, and in some areas such as grande prairie, the hurt is even more. Many of our clients are running on borrowed money and venture capital in the hopes for a turnaround. Adapt the recommendations and you will see many of these companies fold and the jobs with them. Raising natural gas and coventional oil royalties will only further erode confidence and investment in this area. The Energy trust hit last year by our federal governement took massive amounts of drilling and exploration capital off the books, we have low natural gas prices, and increased competition from other countries around the world who want to attract investor and oilfield exploration and development away from canada. Leave conventional oil and gas royalties alone. Add a 20% royalty hit to the oilsands (the only truly busy area left in the patch right now) and you have a recipe for killing the industry that caused the growth that your government wants to continually tout as the alberta advantage. In our family alone there are 5 people employed directly in the resource business as are 1 in 6 albertans. I don't think I am exaggerating to say at least 3 more of those probably work in businesses that will take a major hit if the petroleum resource business in alberta is devastated by its own government. I lived through the NEP when I first started in this industry and it was not pretty.To have our own government kill the goose that lays the golden egg would be one of the biggest political blunders in alberta history. I am a proud albertan. We already recieve 10 billion in royalties. Will 2 billion more really make that much difference if there are massive job losses and investment dollars flowing oversees instead of here where they should be? Think of the real estate market and the home values dropping as unemployed oil workers simply give the keys to the bank. It can and will happen and the fallout will affect us all. Manage our money better. Take a small increase over time if you must to alleviate the political pressure from those who do not understand that their own prosperity is at stake. Ed.....lead. Take a stand and the oil patch and its workers will support you.Do not give in to those who have blindly reaped the benefits of our resource boom , but see oil and gas industry as nothing more then big business there to be robbed for their own political agendas. We take the risks, employ the people and need a fair return on investment or that investment will go somewhere else in the world. I have worked oversees and seen firsthand how much more economical resource investments are in developing countries. Big oil will go there if they cannot operate here. NO to the royalty review recommendations in their present state. Don't mess with a good thing.
RRE3079 In an already failing market raising the cost for oil companys would surely spell diaster for all of Alberta
RRE3080 DO NOT LET THE ENERGY INDUSTRY SWAY YOU!!! You must not compromise! Accept the full report!
RRE3081 [Information Removed]Calgary, Alberta, [Information Removed]Phone [Information Removed][Information Removed]@telus.net October-4-2007 Alberta Premier Ed Stelmach Dear Right Honorable Premier, Sir I as many Albertans believe what you have embarked upon have cost me money. This money would have been used for among other things my retirement and funding my contributions to charities and political parties. Sir I am writing to you on behave of my relatives like me feel that investing in Alberta is a sound business decision. We are concerned that your government is heading to down a road where we will have to invest in other jurisdictions to make enough money to retire on and or live on today. It will take years before we will reinvest in the Alberta companies if you make this decision. Sir this is not a threat it is reality, my relatives who are in retirement and on a fixed income cannot wait much longer for your decision. This process has cost them about 20 percent of their money as of Oct 1 2007. Prior to your formal announcement they will be pulling out and reinvesting in other jurisdictions. They state that you have not shown any sign of love of the oil and gas sector that drives your provinces income and a vast percentage of the Canadian economy as well. Sir my dad always told me “do not to count my chickens before they are hatched.” This reports table on page 17 assumes that production will be the same from today forward. The committee did not listen to the oil and gas producers about the high cost environment of Alberta today. All Albertans want to get richer this boom as compared to the last boom. Hence step in the government always a step behind the service companies and other suppliers to the oil and gas sector asking for more. This brilliant scheme that your committee has hatched does just that, it is based upon numbers that the industry will keep drilling and developing. The reality is they are going to go into Harvest mode like [Information Removed] Have you noticed that [Information Removed] which has a vast amount of great properties in Canada is far from the most active company on exploration and development? After the National Energy Program [Information Removed]have been in the harvest mode only, investing in Russia and other more lucrative areas of the world or Canada. BC is making it easier for the oil and gas business; they still have a debt to pay-off. My job within the industry looks at reservoir data and analysis for an oil company. I can tell you that most oil and gas wells decline at about 20 percent every year. This report does take this into account( see page 17 the data assumes that exploration and development stays the same) if the exploration stops for a few years the negative impact will result in less royalties under this regime. The committee is stating that this regime will collect an extra 2 billion per year but the reality is within two years the province will be taking far less than it is now under this new regime. All of the companies indicated this to your committee and they ignored the hard facts and their input. Now [Information Removed] reduce it exploration in Alberta if this new royalty structure is enforced. How will the Alberta government plan for long term spending when the gold egg is no longer there? Will you raise personnel income taxes like the Tories did in the mid eighties to account for this short fall? Sir my father also told me a “penny saved was a penny earned”. My suggestion is that you change the royalty structure to a simpler system that everybody can understand. This would reduce the need for so many accountants to oversee this in the government and in the oil sector. Sir this has two benefits it reduces the need for resources that can be freed up to do more value added work in the province. Sir you know the 1/3 to 2/3 rule that applies when farming other peoples land. Why would this not be true for resources? This rule has been in place for centuries and is just and fair. The oil companies are on the line with their investors to make a profit. They must mitigate risk and maximum value for the share holder. Under this royalty regime it only drives business out of the province. Who will fund all the Alberta hospitals and infrastructure when the golden goose has been killed and laid to rest? Sir my father always said “do not come to me with a problem if you do not have a solution”. My solutions are right and left wing in nature. Like your committee idea is defiantly left wing no right wing thinking there. First sir use the KIS principle to simplify the royalty structure to a licensing fee only. A sliding scale yearly license fee based upon average yearly production rates. This has a benefit of giving the crown the exact numbers at the start of the year for the licensing fees. It also gives the oil companies more solid footing to begin the year knowing the overall cost right out of the hopper. Secondly sir the government should invest heavily into at least two if not three Nuclear reactors that would feed the tar sands project. By doing so the government helps to clean up the environment and would collect not only royalties from the energy companies but receive a part of the electrical revenue from the plants as well. This would extend the life of the tar sands reservoirs, by doubling the life of this reserve. How does this help Alberta? It puts the people of Alberta as partners in the projects and returns energy profits to Alberta when the oil runs out. Sir look around the world a lot of jurisdictions have to front the seed money for such large public capital projects. The province and federal government funded the first tar sands plant. This investment is nothing like the Heritage trust fund funding Quebec hydro’s dam, as this will payback. This market is captive and growing, not boycotting the producer as was the case with New York State and Quebec hydro. This is just putting our heritage trust fund to work for Albertans in Alberta. Sir my sole promise to you I will be a Tory backer as long as the committee recommendations are not implemented. If your government goes ahead and implements report as published, you will have lost my and my relatives votes in the next election. I will never vote Tory again. We will be seeking a party that will be willing to reverse this decision. Sir I believe that you will become the most hated Tory leader ever more disliked than Brain Mulroney was. Sincerely, [Information Removed] VSignature
RRE3082 I am sending my response to the Royalty Review report. Now retired,I have spent 35 years in the oilpatch as a P.Geol and have some wiisdom and knowledge of that industry. The question I am holding in my mind, as I consider the issues is ... Is is true that Albertans are not getting their fair share of royaltys from conventional oil and gas, and the Oilsands developments? Many statements have been made, and much spin-doctoring has been applied. If nothing else, the statements show that this royalty issue is tied to the economy, politics, the environment, the pace of development; and the royalty review has shown that the fair economic rent to realize can be isolated as part of the whole, but few think it can stand alone. I agree. In my mind, the truth should be graspable. Defining truth is easy, yet knowing if a statement is true or not is more difficult. Many people, inside and outside the industry, have expressed their opinions. Yet, it is good to remember that these are only opinions and not neccessarily the truth. Truth, according to Plato and Aristotle, opinions we hold are true when we assert that thata which is, is, or that that which is is not, is not; and that our opinions are false when they assert that that that which is, is not, or that that which is not, is. So, truth is easy to define. But, the way we perceive a statement as being true, or false is more difficult and consequently falls into the realm of opinion. Some statements are self-evidently true. For example, nobody would disagree that the whole is greater than a part, because it is impossible to think otherwise. A second way to test the truth of statements is to test it by our experience and our observations. The annual reports and press releases by oil and gas corporations show that they have realized unexpected record high profits in the past few years. Their obscene profits have been made partly on the unrealistically low royaltys (last set in 1997 to stimulate the economy) and the rising price of oil, the low $Cdn, and a world thirst for energy. Only a fool would think that this could continue, or should continue. Corporations factor risk into their economics and consider the risks of costs, cost over-runs, reserves, price, deliverability, ROCE, ROR, PV, Future Value etc, and a clear thinkiing decision maker must also consider the risk that the owners of the resource may want to increase the rent. I make a distinction between Non Renewable resources owned by the people, and Renewable Resources owned by individuals or corporations. Corporations should be reminded that their should be no sanctity of contract when one is considering the exraction and development of non-renewable resources. For renewable resources the contracts are short term and constantly being modified. Royaltys may go up, go down, or stay the same depending on the economy, supply, demand, price, costs and environment. Their is no denying the truth that enery companys have made big profits from their operations and would have done so with monkeys sitting around the board room tables. The unconciounable salarys, perks and options of CEO's and Boards of Directors is another story that could be made the subject of a novel . Couple that with many employees now enjying stock options, and it is easy to see that greed and avarice are still the main drivers in life. At any rate, what we are seeing is ears deaf to the truth, and putting forth opinions that are biased. Opinions are only that, beliefs that others need not share. Sometimes opinions express probabilities rather than certainties, sometimes they are subject to doubt, even self doubt, and the magnanimous man recognizes that other men may not share his opinion, and furhter, that when two opinions collide, one may be sounder. When we look at the cold hard mathematics of something, we get knowledge that cannot be denied. Whe the object of our thought leaves us free to make up our mind then we get opinion, and rational people can differ. And when opinion is based on greed and avarice, it is ill-founded and simply a willful prejudice. Some opinions are better than others. My take on the Royalty Review and related reports is that Albertans are being short changed on two ends. Firstly on getting a fair economic rent, and secondly on having to suffer the consequences of too rapid development. The economic engine is revving too high, and maintained by the flywheel of energy, and nobody has yet found the key to shut it off, throttle it back, or build some controls to manage it. I have read some of the corporate spins on this topic and see that many of the arguements are specious. For example, one company says that the increased Cdn dollar reduces the value of US$80 dollar oil today to US$50 dollar oil at previous exchange rates. This is admitting that when oil was $50 US, they were making 80$ Cdn. Besides, exchange rates are not the control of the provincial gov't and why should Albertans receive less in royaltys so that corporations can sustain past levels of return? Another statement is that of increased costs in the energy industry...so what? we all of us face increased costs, wherever in the world we live. Do corporations think we should take less royalty so that their costs are reduced? Maybe they could reduce the CEO and BoD salarys to reduce costs? The oilsands developers pay only 1% royalty to payout, and this has resulted in poor, or indefensible cost control by management. Cost was no object to consider if you are going to recover all costs....and this lack of cost control had driven up the price of welders, whores, and widgets to unreasonable levels. Managers did not heed cost control rigourously enough and have little compunction to blow the whiste on themselves. I see CAPP argues that rates of return in Alberta are low relative to other countries, but their graph statistics are misleading. Comparing Albertas conventioal oil to areas of the world like offshore China, North Sea, offshore Africa or the Middle East where fields are elephant size, high deliverabilty, and high political risk is not an apples to apples comparison. At any rate, the corporations have made threats, gestures and generally whined and complained, and this is a normal response when your bottom-line is threatened. It is the kind of response one would expect. I don't think anybody in their right mind wants to kill the golden goose of oil, and would prefer to continue some of the gains we have come to expect. Looking at the facts and figures, it is my opinioin that their is ample room to increase royaltys, and if this results in a slowdown of the Ab economy, then it will be a double gain. The oil in place and gas in place remain the same, and we can extract it over a longer period of time. The energy pie will continue to grow via price, and further royalty increases will then be justified, but met with the same dissent from some quarters. If royalty rates are not increased by this goverernment, then I think the next one, probably a Liberal-NDP coalition judging my popular opinion (whose votes form a majority) will come out with an even more onerous royalty scheme that will cause some corporations to close shop, temporarily and wonder why they didn't just accept the report, swallow some profit, and get on with their jobs. Anyhow, this note is getting longer than I intended, and if I had more time it might be shorter. If nothing else, by the very nature of writing it, I have defined my position to myself, and see that this is a big mess and that the Royalty Review is only one of many factors in the ultimate equation. Regular royalty reviews should probably be done every 'x' years, or triggered by some external event like price, profit, the need for economic stimulus, and probably other factors.
RRE3083 I would like to know how the amount of money saved by budget cutbacks in Mr. Kleins first two terms compares to the royalties this report suggests we were entitled too, but did not collect. Thank you
RRE3084 I would like to suggest that royalties be kept the same as they are now, the people who will take the hit if fees go up are the many thousands of people working in the industry on the ground. It is unreasonable to compare our situation here in Canada to others around the world because our costs of doing business, regulations etc. are different. Maybe we "could" roll the dice and squeeze a little more juice out of the lemon but who are we going to hurt in the process, the little guy. Keep things the way they are!!! (a bird in the hand ...) [Information Removed] Edmonton
RRE3085 I appeal to the preimier and the Aberta Government not to implement the Panels recommendations. Don't let the Panel Kill our Alberta economy!
RRE3086 The Royalty Review Panel has been very generous to the oil industry by their own admission. The Parkland Institute report clearly states that the royalty rates deserve to be significantly higher. . Therefore for the government to compromise on it further would constitute and compromise of a compromise. A total watering down of a very generous offer to oil industry would show a complete lack of resolve and surrender to the oil industry. The oil companies, for all their bluster, will not pick up and leave. Why would they? They will not get as good a deal anywhere else as they have here in Alberta. In addition, poor book keeping and a total capitulation to oil company industry demands by the provincial government in the past has left the oil industry with a feeling of entitlement that they will have to learn to shed. The oil industry is unleashing its full force in the hopes of cowing not only the public, but bending the will of the government. Premier Peter Lougheed went head to head with the oil industry and faced them down. Danny Williams stood up for the people he represents and they responded in kind by reelecting his government. Today the oil industry has many tools at their disposal to promote their self interest but it still adds up to bluster, posturing, intimidation, and bullying. Like a greedy child, the oil industry wants it all. It’s well passed the time that they have to learn share with others. This government must show resolve and leadership and display that they are not subservient to the oil industry. They are there to serve the public interest. [Information Removed]
RRE3087 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 13:31:09 DATE ENTERED {ts '2007-10-02 13:45:01'}
RRE3088 if I was told by the government that I would have to pay my workers to locate "possible" deposits, Drill the wells, build the pipelines, Build the facilities, maintain all of the above, pay 19% income tax after expenses.... oh! and give the Government 64% off the top...lol . I'd tell the Government to get bent and set up shop "elsewhere". If the rates go up, Alberta's economy will crash along with the hundreds of thousands of patch workers and their family's lives. We are already just getting by. If this rediculous increase is approved, we will all be worse off.
RRE3089 I think it is most unfortunate that the only province in Canada where hard work and entrepreneurship has a fair chance at success, is now contemplating changing the rules in the middle of the game visa a via proposed royalty hikes. The sedimentary basin is mature with only limited hydrocarbons left. The price of natural gas which is the prime factor in activity in conventional drilling is already low with most junior companies hanging on by the skin of their teeth. Any additional burdens on this sector will be fatel. Its a shame the "Fair Share" report authors have not realized the downstream benefits and what this could do to our province's future. Don't be fooled by polls in the paper and oppisition politcians, this industry to too important and employs too many people. The government was there for the rancher during the BSE crisis, and us in the oil industry hope you are hear for us now. Sincerly, [Information Removed]
RRE3090 OIL and gas is the bigest industry going in Alberta and effects not only the people working in the industry to make a living , but the economy as a whole.
RRE3091 Dear Alberta Government, I am very concerned with the Royalty Review Report. I work in the Oil and Gas Service Industry (Surveyor), and am of the opinion that if you change the rules for the E&P companies, a large portion of Alberta's economy would be negatively affected. If we think of the USA sub-prime mortgage defaults, I would say that a good portion of mortgages issued over the past 3 years would be in trouble if a large chunk of the Exploration and Production investment left the province. Yours Truly, [Information Removed]
RRE3092 I would like to comment on the proposed Royalty Review Report. I live in rural Alberta and work at an oilfield construction company. I feel that the proposed increase in royalties will severely impact our income. The province is full of Albertans (and some out of province residents) that depend every day on the income derived from the production of oil activities. With an increased royalty tax of 20% that the government is proposing, I feel that the oil companies, both large & small, will shut down most or all of their production. The cost of living has increased substantially in Alberta and the cost for the oil companies to drill the oil has also increased. We cannot expect to take an additional 20% of their profits without some major repercussions. If we try to tax them that highly they will likely just shut down and who will be looking smart now? We need to think about everyone and look at the big picture here. It's not just about getting another $2 Billion in taxes to distribute to the province. Although extra Government money available would definitely be welcome, if we push too hard, we'll just end up with nothing! The oil industry is HUGE in Alberta and millions of people depend on that industry. Increasing the Royalty Tax by 20% will just shut that industry down and we will all be unemployed. What's the Government going to do for us then?
RRE3093 If the Conservative govenments are intent upon destroying the environment, we who are being forced to submit to this invasion deserve the increased royalties recommended. Better yet, slow down Big Oil development until a reasonable plan has been implemented.
RRE3094 The Royalty Review debate is being carried out mainly in the newspapers which is has spawned a sensationalistic approach by certain papers. I cannot believe that we can be thinking of a substantial increase in royalties at this time. It will be harmful at so many levels that the province is sure to lose money only to be saved by miracle increases in the price of natural gas. Please wake up and not let the press and ill informed people make a tragic decision. [Information Removed]
RRE3095 As an Alberta citizen, I am extremely concerned about the proposed changes to the oil & gas royalty system. I believe an increase in royalty rates may be appropriate for oilsands production, and perhaps conventional oil, but to increase royalty rates for natural gas at this time would be disastrous for many of our junior oil & gas companies and for the service industry. Most of the small producers in Alberta produce primarily natural gas, which at the current price and high find and development cost is marginally economic or uneconomic. Many of these Alberta companies are already in trouble because their cash flow has dropped, debt levels have risen and they are no longer able to raise money in the equity markets. An increase in the royalty rates on natural gas at this time will result in sharply lower activity levels in our province in terms of drilling, completion and tie-in of new wells, which will hurt the service industry. I urge our government to please leave the royalty rates on natural gas the same at this time and to reconsider when prices have recovered to more sustainable levels. Sincerely, [Information Removed]
RRE3096 I am opposed to the proposal to increase the Royalty Tax on Oil & Gas. It appears that the Provincial Government doesn't realized the residual impact of an increased Royalty structure. First off, numerous senior oil & gas producers have not only threatened to reduce spending on exploration & development in Alberta - they absolutely will reduce spending which would have a significant impact to the general economy. Secondly, the overall impact to employment as well as continued expansion in economic activity will be reversed. People will lose their jobs which will lead to a slowdown in the economy and potentially a recession. Lastly, oil & gas companies have other places they can deploy capital globally which threatens our competitive advantage going forward - in particular when it comes to foreign investment in conventional as well as oil sands development. I urge you to re-consider and endeavor to get a better view of the impact to the economy that such a Royalty structure would have. Sincerely, [Information Removed]
RRE3097 Re: Alberta Royalty Review Panel Report Dear Sir or Madame, I have been an Alberta resident for more than 30 years and have lived in full-time Calgary West for almost all of this period. I am also a Professional Geoscientist employed in the Petroleum Industry and have had full-time and uninterrupted employment as a Petroleum Geoscientist since graduating from university in 1977. [Information Removed] So I am in short, both a concerned Alberta resident and taxpayer and an experienced petroleum professional. I also feel that I have a fairly unique and balanced perspective thanks to my extensive professional background with varied international and Western Canadian business experience. The Alberta Government is currently considering changes to our Oil and Gas royalty regime, as recommended in the Alberta Royalty Review Panel Report. I must impress upon you that as much as I welcome and encourage open and honest reviews of our Provincial fiscal and royalty regimes, I find that the A.R.R.P. is flawed and/or misleading in that it fails to adequately address the entire picture of the financial contribution of Alberta’s petroleum explorers and producers. One glaring omission in the report is the failure to account for the significant contribution of Bonuses and subsequent rental payments from regular Crown sales of petroleum and natural gas rights. The report also fails entirely to adequately address the very significant impact on Alberta provincial income from direct and indirect taxation on corporations and individuals. I would consider that any decisions on future directions in royalty structure reached without full consideration of all of the aspects of provincial revenue form the petroleum sector would be dangerous at best and possibly reckless and foolhardy at worst. Alberta’s petroleum resources are becoming more and more mature and the costs of petroleum related operations have gone up dramatically over the past number of years. In my personal experience, despite Alberta’s enviable oil and gas infrastructure, the operating environment in which the Alberta petroleum industry works still has to be considered to be very high cost with rates of return classed as being very low by world standards. Political and social stability in Alberta (and generally in Canada) has historically reduced the impact of these these factors when companies weigh their options as to where and how to spend risk and development capital. Alberta’s future income and prosperity will largely be based on the successful and responsible exploitation of higher cost petroleum energy sources (oil sands, coal gas and shale gas, enhanced oil recovery, etc.) The capital costs associated with these types of projects is very high and the lead times are long to test and develop these large-scale projects. I have personally witnessed (and survived) a number of business cycles in the resource industry over the space of my own life and career. The down-turns are not at all pleasant. In a number of cases, Government Policy (Federal and/or Provincial) has played a significant roll in either creating or worsening the effects of these shifts in economic activity. As an example, the mining industry in British Columbia suffered a terrible setback and is only now starting to recover from changes brought about by a provincial government two decades ago or more. The Alberta Government owes it to all of the citizens of the province to consider very carefully any and all changes it might make to the means that the petroleum industry helps fund the Provincial Treasury. The government needs to listen to all of its stakeholders, but also has to act in the best interest of all, both in the short-term and in the long-term. Sincerely, [Information Removed]
RRE3098 Dear Ed: i gotta beleive you realize that implimentation of the entire report by the review pannel would be a complete disaster for the energy industry. I work for an energy company and in the particualr field i work in we have spent between $75MM-100MM yearly in capitol programs. We have already heard from our leadership team if our field is deamed to be conventioanl oil replacing its current status of oils sands our royalty costs will more than double, resulting in minmal capitol spent in the field. Its to obvious what the impact will be if this program is implimented across alberta. I strongly encourage you and your team to reassemble your pannel and debate this with the energy industy to get a more accurate account of what this may really look like.
RRE3099 I have read the report and am dismayed over the findings. Although I am in agreement that operator's should pay their fair share, I do not feel the recommended increases and timing will be beneficial to Albertan’s. I do believe if these recommendations are put into place, we will be returning to a deficit position by 2010. Lower gas prices along with the services required to drill and complete wells have created the perfect storm for lower activity. The implementation of the panel will cause the eye of the storm to stall over Alberta for the foreseeable future. The large companies have stated they will pull monies earmarked for Alberta and redirect them to climates more friendly with respect to a return on investment. I have no illusions that this will not occur as you cannot create royalties from wells that are not drilled. I lived through the NEB once, why recreate another catastrophe.
RRE3100 Yes royalties need to go up. AB. needs to be putting money away & investing in other industries for when the oil runs out. And yes of course industry will scream when some of their money is reduced, but with the price of oil now and in the future it is quite ridciculous to think that investment would be scared off in a significant way. Might be good to compromise a bit and go with 15%.
RRE3101 what ever the % increase planned, you should double it! dont worry about "POOR OIL CO's" whinning, oilsands is the last big play there will be in alberta ( check your own facts on that one ) .I am tired of 8 hour waiting in emergency rooms, poor infrastructer,..including schools! All the while seeing CEO's of FORIEGN OIL COMPANIES brag about their miltimillion $$ bonuses because "they are doing so well in alberta". Tax them hard so we have SOMETHING when the eastslopes gas is gone in 20 -> 30 years ( check your own facts on that one ) Its time OUR government takes control of OUR resources instead of being a puppet to houston
RRE3102 It is about time that someone in power acknowledged that Alberta was remiss in collecting royalties. Alberta was collecting among the lowest royalties of any oil/gas producing jurisdiction - even with the proposed increases they will still be on the low end. The idea that following the recommendations will reduce petroleum industry development in the province is ludicrous. Alberta is a safe and stable environment without the "inconveniences" of war and political unrest that plague many other oil/gas producing regions (many of which have higher royalties) and the oil companies still invest there... so of course they will continue to develop Alberta's oil resources! All they are doing is complaining in order to keep getting the best deal they can and laughing all the way to the bank while they [Expletive] Alberta's environment and economy! The really sad thing from all of this is that the government is actually listening to the oil companies... proving once and for all that in this province the only voice that matters is that of big oil!
RRE3103 Ed, Please dont kill our province..Alberta depends on the Oil industry. Dont turtle and bow in to the whiners who have ther hand out and are to lazy to work. Born and raised in Calgary I went through the NEP. Companys left Alberta and have never come back. Some Ed bucks would go a long way..share our wealth ! Thanks, Concerned in Cowtown
RRE3104 The Royalty Review Panel reoprt is lying to Albertan's! It does not include land sale bonuses in its calculations ($3.43 BILLION contributed directly to Govt. coffers in the '05 - 06 fiscal year alone). (See Daily Oil Bulletin, Sept 27/07, pg 3). This puts us right up there with these so called higher tax regimes that the panel keeps comparing Alberta to. Stelmach's govt. is on the verge of making a huge mistake if it raises royalties on conventional oil and gas. Companies are ALREADY cutting way back and to further burden them now will cause a sharp downturn in Alberta's economy. This whole thing is presented as though Albeertan's have been getting a raw deal somehow with thie "Fair Share" terminology. Why doesn't someone stand up and say its more than fair right now! Getting greedy will come at a price. Yes Alberta will grab more in taxes for a month or two. Whoopee. A few months after that everyone's property values will start to drop because oil companies and service companies are laying off. Layed off people don't buy houses and spend money in stores so reatilers will also be cutting back. The whole economy will be effected. Why doesn't someone in government say that! The bottom line is this type of issue should never become a public issue as the average person, if told there might be more for him, will of course say yes to it. But the average person doesn't understand the full cycle economics of the oil patch. They haven't experienced the 'boom and bust' cycles and wild price swings. It's up to Government to get it right without involving the puplic because the public doesn't know the whole equation. The Govt. is supposed to understand business and provide a climate where business can thrive. That's what was done in the last government and Alberta has fiscal record to be proud of - nobody should be crying for more. You guys have to realize that INCREASING CONVENTIONAL OIL AND GAS ROYALTIES WILL BRING ABOUT A HUGE DOWNTURN IN ALBERTA'S ECONOMY ! Afraid for my job, [Information Removed]
RRE3105 the report has been based on old data that did not reflect the huge increase in operation and contruction costs. It also does not properly take into account the effects of currency changes on costs and revenues. Alberta takes its royalty at the front end and does not have to deal with the increasing costs, it is a risk-free return for Alberta. Also the report does not reflect the huge revenues from Land Sales of Mineral Leases. These would drop along with investment if the province tries to grab more of the cream on the top of the cake. If you leave no room for profits there will be no activity to generate ANY money. Leave the incentives alone and just increase the royalties a little. Perhaps raising the royalty rate a little at much higher price points. We all benefit with jobs, profits for small businesses, good stock market returns and a benefit to the National economy too. The rural towns that provide a huge amount of services to this industry will be very badly hit. It will all be gone if you guys get stupid and blow it. No doubt this panel cost a lot of money and they have done a lousy job. We have been ripped off by them, not the oil companies.
RRE3106 As an Alberta citizen I am concerned about the impacts this report would have on the Alberta economy. I think that these recommendations would severely damage our province's future and I am not prepared to jeopardize the only province in Canada that isn't currently in debt in order to deepen the pockets of government officials. Most importantly, our jobs as albertans are too important to risk if poorly informed decisions to adopt this report in full result in an economic crash in Alberta. I believe that they should first get more industry input and a better understanding of the consequences before making a decision.
RRE3107 Good morning, both of my husband and I work in the Oil & Gas Industry. [Information Removed] We heard about the Royalty increase in Alberta, the first thing came to our mind is that he may be laid off again. We have prepared to deal with another lay off after learning from the past. He is over 53 years old now. If he got laid off, we are prepared to collect UIC as long as he is qualified. Then he will start to apply of Canada pension when he reaches 55. There is a lot of baby boomers out there working in the oil patch. The increase of royalty will have impact on the economic of drilling wells. Their jobs will be impacted if there is not enough drilling. They may collect UIC instead of paying taxes. Oil & Gas company will pay less royalty and taxes if they decrease the level of drilling. Othe impact will be decrease in stock price & house price and less spending on consumer goods. It will be favourable to every one if there is no increase in royalty. No change is good. Thanks for listening. Best regards, [Information Removed] Oct 16, 2007
RRE3108 Alberta royalty increases = job decreases
RRE3109 This could not come at a worse time as far as I am concerned. I am 3rd generation in Edmonton and Alberta is finally seing some prosperity we have not seen since before the fiasco in the early 1980's. Now the new conservative government wants to curtail the growth and in the process may summon the average Alberta citizen to another 20 years of Oil & gas companies taking their money elsewhere. Shame on you conservatives this time if you proceed with this. It will be ugly. What kind of message are you sending to these companies when you change the rules after they have spent billions on this knowing what the financial model is.
RRE3110 I have *long* thought that Alberta's natural resources were being given away far too cheaply. Definitely ... raise the royalties!
RRE3111 The province of Alberta doesn't need 40 billion dollars as a savings account. Government is not a business that needs to make a profit each year. The money is meant to pay for universities, schools, infrastructure, health care and other services such as providing shelters for women in need or the homeless. Its actually an embarrassment that Alberta has all this money sitting for a "rainy day" when its been raining for 20 years. The money was saved by cutting on services. Just alone, the U of A is in need of 350 million for building upgrades. High school classrooms are crowded. Roads are crumbling and cities don't have enough to function and provide better services. There is no vision for Alberta except to save money with government officials patting themselves on the back for cutting services. This province could have a vision that entails more than acres of destroyed land from the oil sands development. With cutting edge universities and schools, development of infrastructure and cutting edge health care, this could be a province that becomes highly desirable to live in and attract people from around the world and other provinces. Including other forms of businesses and technologies.
RRE3112 this is the stupidest thing ever been thought of by an Alberta premier. I can't believe that our premier is even considering this. Sask. is praying that we do this so these companies can go and start drilling in Sask. I wonder what the Alberta going to do with the extra $2B, I live in Airdrie Alberta, so I hope I get a hospital in the 30,000 people city. every aspect of our Alberta businesses happen because of the oil and Gas industry. my house doubled in price in 4 years because of the Alberta oil and Gas. I work for a Telecommunications, now you might think that this has nothing to do with oil and gas so this business should survive. well, you're wrong most of my customers are [Information Removed]. [Information Removed]are my customers as well, but they wouldn't be in business if [Information Removed]etc...lay off 10's of thousands of people. bottom line, as a resident of Alberta which I love, I urge the premier and his gov. think of our great province and think of the great economy that we all enjoy because of this industry and finally think about the RIPPLE EFFECT of your decision. [Information Removed]
RRE3113 I support full implementation of the Royalty Review Panel. Their position has been supported by the Auditor General's report also. We have been short- changed by the oil companies for years. Unfortunately, the Klein Government appears to have knowingly helped them do this. If the current Government of Alberta does not stand up to the oil companies and demand our fair share, I do not think they will survive the next election. I am a Conservative, so I would not like to see that happen. We need to take a leaf out of Danny William's book. We have a resource that is in high demand which is located in the safest geopolitical region of the world. Oil companies cannot ignore this fact. I regard Encana's remarks and threats little short of blackmail. In any event, I feel strongly that the so- called Alberta Advantage has long since disappeared for the average Albertan. The economic boom , with the increased revenues has been largely offset by rapidly escalating costs. Housing has become unaffordable for many and small businesses are having great difficulty finding employees. For this reason I am in favor of slowing down the rate of development into something more manageable . In any event I do not understand why we are in such an all-fired hurry to give away our resources. Many of us are also concerned on the environmental front,especially in the tar sands development. They have produced a huge toxic lake with no idea of how to clean it up and recycle it. I do not trust oil companies which are mostly foreign owned to come up with the technology to deal with this problem unless we force them to do it. I realize we have reclamation regulations but they do not seem to be keeping pace with development. I and many others have a fear that at the end of the day the oil companies, having extracted their profits, will pull out and leave Albertans with a huge mess. In retrospect the Alberta Government under Ralph Klein has shown a remarkable lack of long- term planning and I suspect history will judge him rather harshly for this short-sightedness. I hope the current Government can do better for Albertans. On an other topic, I would like ti indicate that I am in favour of nuclear power generation. It does not make sense to keep building power plants based on a non renewable resource when we have other options. Disposal of nuclear waste presents a smaller environmental threat than does the air pollution created by natural gas or coal fired generators. Since the amount of waste is quite small it would likely be feasible to load it on a rocket and fire it into the sun, where it would be less than insignificant.(My opinion not a scientific fact) Nuclear power is much safer than it was in the past. As has been pointed out often France generates 80% of its power this way and does not seem to have any problems.
RRE3114 I understand that the government could have been collecting more in royalties, but to increase the royalties to the numbeers that have been suggested would completely cripple the oil and gas industry. We would go from being the richest province to huge unemployment problems. Yes I understand that they should be increased but baby steps would work alot better than what is being suggested. If I was the oil companies I would just shut the taps off and leave. Do you really want that again, look what it did to the province before and think about how long it took to recover from that. As a business owner myself I would walk away from my business if the government suggested increasing my taxes by that percentage. People are worried that they are not getting their share out of the oil companies but how many of us make a living off of them. Increase the royalties but work with the oil companies to find a number that you can both work with, if you shut them out and just tell them to pay this well you have just put this province in the toilet. Yes there are people out there that will say that the oil industry does not affect their business at all and they would be as busy with it as they would without it, I really believe that there is not one business or for that matter one working person in Alberta that does not benifit from the oil & gas industry in some way. You really need to think about that when you start increasing your royalties, cause if the shut off the taps think of the millions or billions in taxes you will lose from the working class and the huge amount you will have to pay in employment insurance. Not a very bright future for Alberta in my opinion.
RRE3115 Thanks, it's about time the Alberta Govenrment is taking on oil and gas. They have been making nothing but money and laughing at how little they pay for it. I've also traveled the back roads lots and there is no way we need all this activity right now. Only reason for this is royalities are so cheap so they can over develop. before the people of Alberta wake up and see what is realy going on. Thanks, and if the oil and gas companys leave then let them. I'm sure there will be more comanys standing in line for our oil and gas. [Information Removed]
RRE3116 Amid the growing chorus of voices urging you not to implement the recommendations of the Royalty Review panel, please let me add mine to those urging you to accept these recommendations and fully implement them in their entirety. I won't go thru the reasons why, but I do believe you should trust the opinion of 'average' Albertans like me AND you should trust the board that you appointed to complete the review. I just wanted my voice heard as one who does not support 'big oil' in this debate. Thank-you. [Information Removed]
RRE3117 I believe its time the oil sands companys especially [Information Removed] and [Information Removed] paid more to the people of Alberta for years of low royalty rates.
RRE3118 I have only been in the oil and gas industry for 3 years but that is long enough to see some high times and some low times. The opportunity this industry has given me to further my live is huge. At 24 I have a mortgage on a home and I have a nice vehicle. I got married last year and now have a child on the way, all because of the opportunity this industry has given me. I pride myself on being able to support my wife and child. I know alot of young people in this business who also have started a good life with dreams of retiring at 45. If this royalty issue goes through it will not just effect the lives of the people that work in the industry but the people that don't. I saw the effects of the slow summer we just had and if the Oil companies start pulling out of alberta it is going to cause alot of people to lose their jobs. I for one wouldn't know what to do. The lifestyle I have adapted to would be turned upside down if my industy shut down. So do not approve the proposed Royalty Increase, It will not only effect my life but the Life of my unborn child.
RRE3119 I am a citizen of Canada, and a resident of Alberta. Although I have a small oilfield service company, I do believe that the royalties should be increased; the recommendations of the Royalty Review Panel should be fully implemented.
RRE3120 I work for [Information Removed]. I like my job and salary. I spend my money in Alberta. The panel recommendations place my livelihood at risk. The numbers the panel used are flawed. Please work with industry to find a better solution - a more reasonable increase.
RRE3121 I am concerned not only for myself and my children's future,but for what will happen to the province that i love and have called home for many years. If some Albertans think this won't affect them because they don't work in the industry, they are fooling themselves....this will trickle down and affect everyone living here. The government is trying to push it onto the citizens by dangling the carrot of getting more back in income taxes, but what's it matter if you have no income? Does the government even realize what they will be paying out in unemployment insurance to the thousands of people who will become unemployed? It's the government that's being greedy, not the oilfield companies. We have the richest province in the country because of these companies, and without them things are going to go downhill quickly and by the time a lot of people figure out what a bad decision it was, it will be much too late!!!
RRE3122 Perhaps if the data was up to date then it could be looked at in a more realistic fashion. But the government being the government and failing to do research properly as why woudl you want to do whats in the best interest of the people...you are going to pass a law on inaccurate and out of date information? Smooth. Real smooth.
RRE3123 As a member of the PC Party of Alberta and as an Albertan I wish to register my great disappointment with the royalty-review process. I believe this to be a flawed, politically-driven process which, if implemented, will undermine the economic success for which Albertans have worked so hard, and which has made the Province of Alberta the envy of Canada (and beyond). Fundamental errors in the panel’s analysis are numerous: one particularly odious example is excluding from the calculations the billions of dollars the government receives from industry in land sale ‘bonuses’, payments which simply have no equivalent in other jurisdictions to which Alberta was compared. I can only trust that the recommendations of this panel will not be accepted, that input from industry is sought and considered, and I urge you to work in caucus to see that the recommendations are not implemented. Oil and gas production in Western Canada is a very high-cost enterprise. Gas production, in particular, is marginally economic at current price and royalty levels. In fact Alberta has become a ‘marginal producer’, supplying gas to the US when gas shortages in that market result in prices high enough to support drilling and production in high-cost Alberta. Lower-cost LNG terminals are being constructed in the US, and the risk is great that high-cost Alberta gas will be displaced by low-cost liquefied gas from Algeria, Indonesia, et cetera. With the recent decline in gas prices (while still above historic levels) drilling activity has decreased precipitously, with rigs idled and oil-and-gas service-sector workers laid-off. Ill-considered and rash changes to the royalty formulae will worsen this economic decline. Under our former PC leader and premier, Alberta was known as a good place to do business; the government was a reliable and trustworthy business partner and as a result all Albertans had an opportunity to prosper. Men and women designed businesses, invested capital, built companies, and grew employment based on the existing royalty programs. These proposed changes to the royalty scheme, if implemented, will radically affect the economics of these enterprises and, perhaps even more damaging, prove our government to be a poor business partner, and lead investors to conclude that Alberta is no longer a good place to do business: the sad end of The Alberta Advantage and the prosperity it has created. It is unbelievable that industry should find itself facing economic devastation at the hands of the government now, after it has seen access to capital makets all but dry-up, gas prices collapse, and the changes to the royalty-trust taxation. It is simply a recipe for recession. I find it particularly frustrating that we should be facing such draconian changes at the instigation of the Conservative Party of Alberta, particularly after watching the billions of dollars of market value destroyed when the federal Conservatives went back on their promises with changes to the trust legislation. It has become impossible to know just which party - if any - is worthy of our trust. Yours truly, [Information Removed]
RRE3124 As a long time Albertan of 33 years, I want us to be very careful that what our government does now will not affect the future. If jobs are lost and oil companies do relocate, will the government of Alberta indeed benefit from the royalty increase? Who truly is the winner here? Please don't say it's us the Albertans. We the many Albertans and Canadians are indeed employeed by the oil industry. Let's face it, this province's economy is driven by the oil industry. Being greedy could be very costly. Do we take that chance? I think not. Thank you. [Information Removed]
RRE3125 I am completely in favor of increasing royalty rates so that Albertans, who own the resource, can receive their fair share. Hopefully Premier Stelmach will act for the people of this province when making his decision, and not for the oil companies.
RRE3126 I think Canada will shoot themselves in the foot if they take that money away from the oil companies. All the oil companies will pack it in and move over seas. You think you will save money but you will lose more in the long run. You take half my pay as it is and you wont have it if I have to leave this country to find work. I guess Canada just wants to be second class.
RRE3127 Any polling that requests an opinion as to whether or not more money is available from an industry, is no different than my three teenagers asking for more allowance. They really are unaware of the consequences and frankly really don't care. If someone asked them, do you want more allowance, of course the response would be yes because they are only considering themselves. This is no different than having panel on non experts review royalties. Put another way ....Is there more tax room available for the government to tax individuals...of course there is, but the ramifications are significant in a negative way. Alberta is perhaps the highest cost basin to explore in, in the world. In addition, in comparison to years past, the basin is far more exploited and new finds are far fewer and smaller and more expensive. Raising royalties now is not the same as raising royalties in years past Oil exploration dollars are mobile and will move. As the president of this junior oil company, we will look to explore in other more economically favorable jurisdictions. Entrepreneurial junior oil & gas firms creat a significant amount of employment not just in Calgary but also in rural Alberta. The consequesnces of potentially poorly thought out government policy does have real and substantive consequences. Sincerely [Information Removed]
RRE3128 Do not increas the royalties. Province has no plan for spending the extra money and will probably waste the funds.
RRE3129 With a decrease in oil company revenue and reduced economic incentive to spend in Canada, has the Government of Alberta considered the reduction in land sale revenues that will result? The "perceived" additional royalty revenue may actually be an overall reduction in revenues. The net result will be reduced economic activity, less revenue, and increased unemployment. Slow the pace of growth for long term Alberta benefits, not the economic incentive to have the growth.
RRE3130 Despite his intentions, which are fueled by politics, to raise royalty rates, Ed Stalmach should look beyond communist Union lobbying and advice from a socialist panel that he appointed prior this year. Alberta’s and now for the most part Canada's, economy is largely dependent on oil and gas production. The economy will be impaired by this decision, and the 'trickle down' effect will be felt everywhere. A dollar beyond par coupled with a devastating hit to Canada's economic engine (oil and gas) will not result in a positive outcome. How can it? Think this through, there are other ways to slow an economy IF it actually needed slowing. Almost unarguably it does not need slowing. C'mon Ed, just because you were not voted in, and nor will you be voted in again, does it mean that this is your opportunity leave a legacy. Just collect your paycheck and retire when your term is up. PITA just set up shop in Edmonton, go apply there and fade into the political shadows that you should exist in presently. Sincerely, [Information Removed]
RRE3131 For crying out loud, don't kill the goose that laid the golden egg. There are a lot of people who have put a lot of work into building businesses that serve the energy industry. The jobs of a lot of people rely on the energy industry, both directly and indirectly and every one of them generates tax revenue. I think the government of alberta is already getting it's share of energy dollars - when the price of oil was dropping I did not hear of any review to see if perhaps royalty rates needed to be reduced.
RRE3132 While I do agree that royalty revenues should be revisited if they appear to be unfair to either side, I would question the wisdom of an Alberta produced "NEP". We all know what happened then. Competition for capital has a strong influence in the marketplace and Alberta is not the only marketplace. Further dithering on this issue will result in very tight available capital and real pain for juniors and smaller E&P companies - they will suffer more than "big oil". I also am extremely disappointed in the Alberta Government's inability to manage its own affairs responsibly. You and especially the previous goverment, have squandered our "Heritage Fund" . Compare the Rate of Return generated in Alaska or Norway with what you have achieved with our revenues. This royalty tax grab appears to be in lieu of responsible spending. Thank you.
RRE3133 With regard to the Royaly Review, I think that it is important to make some changes to the royalty structure. Although I also feel that within the last 6 months there have been significant changes to the economy of Alberta and Canada. The most being the rise of the Canadian dollar. I feel that if the report were to be adopted in its entirety we would see a severe recession in Alberta. Not only does the government depend on the energy sector for their revenue but so does the majority of Albertans. If the energy industry decides to cut back on the amount of the work they do in Alberta and choose to put their money into other countries, we would suffer greatly. I hope that you as the government will look at all aspects of the effect of this change on Albertans. Just because their is money out there doesn't mean that we need to be greedy. In our society people can prosper based on hard they choose to work and what field they work in, it is based on choice, not socialism.
RRE3134 Please do not tamper with the existing formula. I feel it will negatively impact the momentum of prosperity and the climate of business investment and growth in the Province, particularly in the oil and gas sector. This will also create a dangerous fallout to the rest of the Canadian economy.
RRE3135 I am very concerned about the recommendations from the Royalty Review and do not feel they are accurate. I understand that royalty rates may have to be increased, but I also feel they should be raised to rates that are fair to both Albertans & industry. Albertans are so fortunate to enjoy such a thriving economy which would ceratinly not be the case if the suggested rates are implemented. I am also very concerned about the government's spending & worry that once again the province will be in debt. Sincerely, [Information Removed]
RRE3136 As an employee of EnCana Oil and Gas, I think it is obvious I do not think the royalties to government should increase to the extent that is being discussed. There are many areas of business that will experience the trickle down effect if the oil/gas companies are forced to cut budgets. I realize the new increases would not "break" these companies but it will make a huge dent in revenues, which will affect everyone!
RRE3137 With this message I sincerely ask the Alberta Government, especially Mr. Stelmach, to review the Royalty Review Report VERY carefully and make a very sensitive decision - a decision that will keep Albertans as well as the industry in mind. I have read the "Our Fair Share" report and have been following the escalating news stories very closely and in my mind there is only one way to go - a FAIR SHARE for Albertans and the Industry. Let's share ... and we will all come out as winners. Yes, industry cries out loud. Who wants to let go of a rainbow touching the ground (although quite expensive to grab but lucrative when you got a hold of it). But industry took their chances ... and their daring made Alberta a very good and wealthy place to call home. Yes, every Albertan cries out and wants "a fair share" - who wouldn't want to be part of the riches of this province. But how much did every Albertan invest in this lucrative business, how much did they really invest out of their own pockets? Yes, they deserve a fair share - but not all of it! Someone is missing a very important word in this whole mess - SHARING. Sharing our wealth with the ones that dared to explore, invest and act upon this provinces riches and the ones that call this province their home and should profit in some way. Mr. Stelmach, please make your decision a SHARING one - Alberta's future depends on it. Thank you!
RRE3138 This review has me worried about the future of myself, my my company, fellow Albertans and of Alberta. If this goes through, work will be lost, homes will go back to the bank, vehicles will be repossesed, and the list goes on. How does Mr. Stelmach think that this will benefit Albertans?? It does not make any sense to me at all. With the loss of billions of dollars in oilfield investments we will all be left with nothing, well everyone but the politicians. When millions of dollars in houses get repossesed by the bank, how will the bank maintain their operations?? Increasing the royalties will take that "ALBERTA ADVATAGE" and eliminate every last part of it. The one thing that has brought thousands of people to our great province will be destroyed and will force them (and more) to leave faster than they arrived. Please take into consideration the economic impact this will have on our province and the lives that will be destroyed because Mr. Stelmach is trying to leave his mark on the history of this province. GREED looks to be a big motivation. Having WORK will benifit me more directly than an increase in money that goes to the government. There will be no royalties paid if the oil companies pull out and go somewhere else. My industry gets no sympathy like our farmers. If the oilpatch slows down I probably will not recieve money from the province to compensate me for the lack of work in the oilfield, Like the farmers recieved as a result of drought and BSE. I hope my voice will be heard. Thank you so much for your time. Sincerely, [Information Removed]
RRE3139 I feel that we should stick it to these oil companies! We are selling are oil and mineral rights for way to cheap as it is! Also when we started the contract for royalties the price of oil was under 30 dollars a barrel. The price of oil is well over 80 dollars a barrel so i think we should double the royalties not just raise then by 2 billion a year we deserve it as the price of oil has just about tripled since the last time we looked at royalty rates. These oil companies have been getting a great deal and are getting to gready they dont tell us we tell them what they are to pay. Any oil company that opposes like Encana should get dinged even harder and should remeber they cant push us around they arent the boss! Alberta Government should start there own oil company and sell are own oil and gas on the open market if these oil companies get out of line so that they cant control are economy the way that they can if we have a provincial oil company that sets the standards for all oil companies to follow!
RRE3140 I'm disappointed in the knee jerk reation the Stelmach government when it comes to revenue sharing. The economic engine for this province is the energy sector. This sector spends some $60 billion per year which has a hugh spin off effect on every other sector of the province. The government should consider the impact on the province when this spending is reduced and it will be reduced. The government can't reasonable expect to take more without an adverse effect on the spending these companies contribute to the province. It will happen. Your ARRP should have included the whole amount paid to the province rather than just one select area. Based on any analysis I have seen Alberta is getting its "fair share" when you consider the take from royalties+land sales+income tax. Why wasn't the whole pie considered by the ARRP? Why wasn't the high cost structure of Alberta development considered by the ARRP? Have we even defined what "fair share" means? I'm a proud Albertan and (likely former) Conservative supporter that is embarassed by the shoddy quality of this report. Every thing I read in the papers suggests that the energy industry is willing to work collaboratively with stakeholders to come up with solutions that won't devastate the economy. Shouldn't we at least hear what they have to say? This government needs to tread carefully and arm itself with ALL the facts before acting. To do otherwise could have a significant negative impact not unlike the impact of the NEP. I find it incomprehensible that this government could bring significant disruption to this province without doing a complete impact analysis. It's irresponsible.
RRE3141 I think this will definitely create job losses for many of the indiviudals workingi n the industry as well as those that provide services for the industry.
RRE3142 Royalties should be INCREASEDby about 500% to reflect what other jurisdictions are charging. So instead of charging 1% for oilsands oil, we should be charging 5% - still a bargain considering our stability and infrastructure.
RRE3143 [Information Removed] announced it would reduce expenditure by 1 billion if royaltys are increased. Good, this province needs to slow down a bit, I cannot find people and they are for the most part overpaid. Oil companies are crying about royalties as they rake in record profits. Get what is fair for the people of Alberta. If they want to shut down the patch fine, the oil is not going anywhere and demand is not going to wain anytime soon. And remember 20% is only a recmmendation, 30% sounds good to me. Keep up the good work.
RRE3144 I believe that Albertans deserve the new, higher royalties that the Royalty Review Report recommends. I also believe that the government should not pressured by [Information Removed] or any other lobby group.
RRE3145 The changes should be based on better accepted data, must be grand fathered as the province has collected a lot of land sale $ based on the existing business structure. The province will not collected nearly as much at mineral sales with higher royalaties and province business/income tax will decrease the more changes impleted on roylaties. It would be very unwise to rush into any gas royality changes now except when prices go above $ 10 GJ as the economy will suffer and less prov income will result.
RRE3146 I hope you guys get this right, the impact could be devistating to Alberta.
RRE3147 Foreign owned oil companies are extracting too much wealth from our natural resources. Make foreign owned oil companies pay much more in royalties. Lets not send all that wealth to greedy Americans. Give Canadian owned oil companies a break. Lets create a strong Canadian oil industry that benefits Canadian shareholders. I have worked for a big greedy American oil company. Do you think their shareholders give a damm about the state of our crumbling infrastructure? NO. All they want is their nice secure dividends. They don't pay any taxes to Alberta. Yet they benefit from our nice friendly business environment. The oil is here to stay and we don't have to extract it all now. We can save some of it for later. For our children.
RRE3148 We urge our MLA, all MLA's, and the leadership of our province to take a long hard look at all of the impacts associated with implementation of the royalty review. It is difficult to comprehend the sentiment expressed by people in the newpaper to grab more money for the provincial coffers. They seem to think that the province can collect significantly more money with no impact on jobs and the economy. For those of us who lived through the last government fiscal tinkering (NEP), we all remember the devastation in our economy. There is also lots of talk about companies protecting shareholders - many of us who work in the industry are shareholders, and anyone who has even a small investment in any kind of mutual fund is also a shareholder. Do we really want to see our personal investments deteriorate as well? I am also disturbed that our international reputation as a stable environment to invest in has been irreparably damaged. Most companies have to have a long horizon for investment, and predictable financial terms are critical to those investments. I'm disappointed that we are being considered in the same context as some third world countries. I'm sure there are ways to share in the increased revenues associated with higher prices, but the current plan goes beyond "fair".
RRE3149 I cannot believe this review came to the conclusion that a 20% increase,or $2 billion, in royaties is justifiable. This amount or anything close to it will result in job losses to Albertans and that is not acceptable. Any increase in royalties should be small & introduced over a reasonable time frame (5 yrs) and subject to review based on how the price of oil and gas does over this period. Overall I feel Ed Stelmach's approach on this matter has been poor and for this long time tory voter his credibility has been greatly diminished.
RRE3150 Premier Stelmach, This is not the time to adopt or accept any of the recommendations stated in the Alberta Royalty Review. With ever increasing costs, a lack of available skilled trades, and a precarious world energy situation, now is not the time to make any changes to Alberta’s current royalty structure. To adopt the recommendations of the Alberta Royalty Review, will seriously jeopardize the viability and future investment in our undeveloped oil and gas resources. Domestic and international investment dollars must continue to see Alberta as a desirable and rewarding place to invest with no risk of continued government interference in development. Please take this position on the Alberta Royalty Review to your fellow caucus members and argue passionately against its implementation. Alberta has a history of making the right decisions. Now is not the time to turn even one degree to the left! [Information Removed]
RRE3151 I think we should absolutely increase the royalties as per the recomendations in the Royalty Review Panel report. How can we request a review, look at the independent assessment, and throw away the findings? This is all of Alberta's money, not the oil companies or governments. I respect the work the oil companies are performing. However, this is an independent assessment of the royalty scheme. Respectfully, [Information Removed]
RRE3152 I just want to voice my opinion about the Royalty Review, and how it will impact the province of Alberta and many Albertans. The amount that the government is requesting over and above what's being contributed by oil & gas companies is ludicrious. This will no doubt effect the economy as a whole in years to come, by putting many people out of jobs in the industry, as well having a significant impact on many local businesess throughout the province. I, myself, work for the oil & gas industry, and the town I live in, Edson, is consisted of about 70-80% oilfield based employement. Not to mention, among many others, I have a wife and 3 children to support, and I definately don't want to see their futures in jeopardy due to the possible limitations of their careers and whole way of life being impacted by the economy. In summary, I think this royalty panel is completely unreasonable to ALL Albertans, whether they realize it or not, and should result in alternative measures of FAIR PLAY! Regards, [Information Removed]
RRE3153 I think the royalty review is far too extreme - if the government proceeds with this ridiculous proposed increase, then it will absolutely effect the end of the Alberta boom. Everyone will take a hit from energy companies pulling out, all for the sake of more money to government coffers that gets mishandled anyway. Think about it, Mr. Stelmach, before you sink the ship.
RRE3154 You better listen to what the oil industry has to say on the matter. Do not rely totally on the Panel. There is a difference between being tough and being stupid.
RRE3155 The government should NOT accept the recommendations set forth in the royalty review panel final report. I strongly feel that if these changes are made, oil and gas companies will cut back on their Alberta programs significantly because they won't compete with other programs. Industry is willing to work with government to make reasonable changes to the royalty rates in Alberta. The changes proposed in this report, if implemented fully, WILL HURT ALL ALBERTANS because there will be a slow-down in industry activity. I am concerned that jobs will be lost in numerous sectors and it will be the conservative government's fault. On another note, for a province that has had budget surpluses for a number of years running, indicates to me that industry and citizens are being overtaxed. If these changes are made, where will the government REDUCE taxes so that its people and industry are not overtaxed further?
RRE3156 Simple economics means that increasing the royalty rate will not increase the royalty profits. Decreased activity in the energy sector will like result in a royalty decrease. This province has been built and is reliant on profit from the energy sector. Until another industry can finance the needs and wants of Albertans it would be wise not to drive the energy sector from this province to more fertile areas. They will eventually drill for the oil and gas but while the Alberta government waits for their return, average Albertans will suffer with unaffordable mortgages and unemployment. I urge you to negotiate with the energy sector to reach an acceptable solution for all. Don't cut off Albertans nose just to spite the face.
RRE3157 Plain and simple this report is wrong and disturbing to my family and myself as we are all employed by the oil & gas industry. I can understand raising the rates gradually over a few years (0.25% here 0.5% there) but this report will create a huge negative impact on the oil & gas industry. The majority of Albertans and/or their families will suffer in some way shape or form. I just hope they slow down and rethink this through and realize how many businesses, people & families this will impact in a negative way. Thanks for your time
RRE3158 be tough just like the americans would stick to your guns .its american companies that dont like this.and wats this about bill #46
RRE3159 I have spent the last week reviewing the proposed plan of change to the existing royalty regime. I can not get out of the back of my mind the overall negative affects this proposal will have on the Oil and Gas industry in Alberta. As a concerned citizen living in a province that livelihood is being threatened I could not sit back with out expressing the concerns I have. I have listened to Encana who has publicly stated if this regime is put through they will be taking $1billion out of AB and will spend elsewhere. For a company the size of Encana to make such a public statement that could be misinterpreted but taking the risk means this is not a good thing. After my review I can't help notice some facts that have not entered into the report. They have based the report on activities of 2005. Drilling activity in Western Canada is at a 5 year low and most companies have reduced their capital spend. With the capital spend being reduced and the threat of the major companies moving there dealings outside the province. The economic impact on Alberta I believe is being overlooked. The oil companies make a lot of money, what has not been said is the money they spend to make that money and the contribution to the economy because of the business being done. Towns that rely on oil and gas will definitely be impacted. When I think of Grande Prairie, the city has been built on the oil and gas industry, the city will definitely suffer. I know with out saying anything you can not affect change. As a citizen of this province it was important to me to let my government know that I strongly disagree with the royalty review and suggestions given. I will be following this story very closely and would hope that the government of Alberta is will to listen to the people. Thank you for your time, [Information Removed]
RRE3160 What have you done??? What thought has gone into this??? Who is on the board and how did they come up with this conclusion?? I can only conclude that they are idiots. You are contemplating killing Alberta growth. At $5.00 mcf, gas prices cannot withstand any increase in royalties. Finding costs and depletion costs have increased dramatically in the last year – is your report based on the current environment? Have you factored in the proper labour and service costs? I guess that you will fix the labour shortage in Alberta as the oil and gas industry will come to a grinding halt. Look out real estate – we are overpriced if we enter a prolonged down turn. Vacant office space will rise. Foreign investment – what have you done? Sell Canada is what I hear. Is there not another way for Alberta to increase their share of the pie – maybe increase individual tax rates or introduce a petroleum tax? What will Alberta do with the additional revenues? I am afraid that will just “waste” the funds. Concerned, [Information Removed]
RRE3161 It seems that a majority of Albertans want the new royalty structure outlined by the Royalty Review Commission to be adopted in full because the money needs to be filtered down to the average Albertan. I agree that royalties should be increased somewhat but you have to understand that the costs for these oil companies to extract the oil has gone up enormously. Just because oil is at record highs does not mean it will always be at these levels. Back in the 90's the royalty structure was set up to entice oil companies to begin exploring for oil again. A lot of these companies were struggling at that point (high costs vs low oil prices) and many of them did not survive. The ones that did are now reaping the hard earned rewards and driving this economy and making the lives of the majority of Albertans much better. I believe a happy medium can be reached between the government and the oil companies but to impose a unilateral wholesale change as the Royalty Review Committee is suggesting is completely ludicrous. Does the average Albertan think that the increased royalties are going to come in the form of a check in their mailbox? Can they be this naive? Does the average Albertan realize that the money that the oil companies make does trickle down to them in the form of job creation (weekly paychecks for many), retail spending (jobs created in this sector), vacations inside of Alberta (more jobs) etc. The fact is that the government doesn't know how to spend the money it already receives from royalties. Priorities need to be set to make sure that the money received is allocated to the areas that really need it. Infrastructure is one item that comes to mind. The government has commissioned a study on royalty rates but in tandem with that must come a study that will direct the government on how to spend the money appropriately. Thank you for your time, [Information Removed]
RRE3162 We support the Government's initiative to conduct an open and transparent review into the royalty structure. It is imperative that a review be conducted publicly and utilizing facts and the best data available rather than through a process of political pressure. We also do support the opportunity for the industry to respond to the report's analysis and recommendations as long as they provide reliable and accurate supporting documentation as the basis and not utilize threats.. We are irritated by some industry remarks that as mere citizens we do not have a direct investment in the industry or share in its risks. Our personal circumstances are not unlike that of many of our friends and acquaintances, at least one directly employed by the industry, significant personal investments in energy stocks/mutual funds and rental property owners. But we do believe in a fair regime for both the owners of the actual resource and the operators. We support the approach the committee recommended, less intrusive taxes on marginal producers and an increased share of resources on profitable operations, structured over time. Like many of our counterparts we would not be disappointed if the pace of oilsands development slowed to a more manageable level and a more structured approach. We feel this would help support further refining capacity here as well as help slow the inflationery pressures the industry and all Albertans are feeling. In fact, we feel the cost savings to industry would probably have a more favourable impact to their profitability than an increase in royalty payments on their profitable operations. We don't see a need for delaying the implemention of the report's recommendations. A structured approach for implementing increases is already contained within the context of the report. Finally we do not want to see the Government intimidated by industry and other direct vested interest responses. We believe that the advantages of an assured supply(oilsands), close accessibility to markets, a stable government open to discussion and competitive royalty recommendations offer an attractive environment for investment. We are the owners of the resource, after all. Lets be good stewards and make sure future generations recognize the benefits of this precious resource as well. Thanks for the opportunity to respond. [Information Removed]
RRE3163 During the bozo years from 2001-2006, our provincial government notoriously favored the interests of multibillion-dollar corporations over those of [Information Removed]. How refreshing to be under new management which, over the next couple of months, has the opportunity to prove it gives a tinker's damn about severely normal Albertans.
RRE3164 I do not understand why the government would adopt such a plan. The government already has billions of dollars in surplus cash and has problems spending what they do have wisely. By increasing the royalty rate you are biting the hand that feeds you. Oil and gas exploration is becoming more and more expensive with smaller and smaller results. Speaking from experience trust me the oil companies will leave and go to place's where they will get the best return for there money.
RRE3165 I continue to be shocked and amazed at the total disregard that the present government is displaying in light of the realities of the energy industry in Alberta. At a time when the natural gas business, both conventional and non-conventional, is experiencing huge challenges time due to low commodity prices and high costs, an onerous royalty program is completely inappropriate. A vibrant and successful energy industry means a vibrant economy for Alberta with positive spill-over effects for all of Canada. The heavy-handed "I won't be bullied" approach of the Premier is completely unreasonable and will not have the desired effect. The energy firms are simply not bluffing. They are not trying to bully Mr. Stelmach but they clearly recognize that in order to meet the demands of the market they will be compelled to move their budgets to more economically viable environments. It is absolute folly to suggest that they have no choice and because they are making ‘windfall’ profits they will not leave. The vast majority of corporations are run by Albertans who are fiercely proud of their province and will do everything they can to maintain viability here. Please don’t force them to go elsewhere. Everyone with a pension should understand that driving away big business is not good for their future. Any changes to the royalty regime MUST take into account the nature of the energy business in Alberta where reserves are very challenging to exploit - pools are small and in the case of oilsands are the most expensive in the world to extract. Please don’t jeopardize the future of this great province in order to pursue the short-term political benefit for being the tough guys who took on big, bad oil. Take the longer view. Do the right thing for this province, for the future generations and for all Canadians. Don’t drive the energy firms away.
RRE3166 It is very unfortunate that the analyses have not been properly done by our Government. It is also very unfortunate that the public has not been very well informed about the potential consequences this proposal can cause. Am hoping that you will understand that thousands if not millions of lives depend on your decision. Be smart and don’t feed poison to the geese that feed us all golden eggs. Be smart and let people of Alberta and Canada enjoy the happiness of economic growth caused by Oil & Gas companies. Be smart and encourage the Oil & Gas investments in oilsands by withdrawing this non- sense proposal.
RRE3167 A "review" s totally unrequired. "Dumbo Ed" is only looking for excuses why the "Report" should NOT be implimented. He and the Pc Party will try to do as the Oil Lobby want. He is NOT concerned about Alberta, or our resources. That is why he and the Pc Party are in disfavour.
RRE3168 [Information Removed] I think the royalty review is about the gas indistry, I think that you should do what the workers say and give them what they want.
RRE3169 Corporations should not dictate rules to the government. Albertans deserve to be paid full value for their non-renewable resources. Please do not back down on this royalty issue, implement the recommendations of the Alberta Royalty Review Panel. A Concerned Conservative
RRE3170 PLEASE ------ don't bow to the bullying of the oil companies and investment brokers. Our children deserve better. Please implement the report as written. [Information Removed]
RRE3171 I believe that one of the main reasons why Alberta is the best province in the world to live in , is due to the Oil and Gas Sector. Rather than hit the main players in the industry overnight, it should be phased in over a long period.
RRE3172 My e-mail address has been included. It is true that I work for an oil and gas company but I am writing this from a personal perspective, based on what I've read over the past few weeks and what I know of this industry. As a [Information Removed], one of my many duties is gathering market intelligence. Anyone who has worked in the patch knows that over the last three years costs have escalated dramatically. We have struggled to find creative ways of keeping costs under control and done what we could to ensure security of supply in a predominantly suppliers' market that has only recently shown some signs of easing in the Canadian oil & gas basins due to depressed natural gas pricing. Rate of return is what drives oil & gas development and the decisions our CEO's make on where to invest cash flow. When gas prices are down, companies redirect their funds towards the oil sector, including the oilsands, which are the next frontier, with a significant amount of the world reserves of oil - second only to Saudi Arabia. Historically we drill 75% gas, 25% oil and this ratio is changing due to continued low prices for natural gas. This in turn makes it difficult for the service companies to keep their revenues up when their services are not required and behind all this there is a whole industry that is already struggling. If looked at from a combined overall return on costs in various operating environments, John S Herold's report would indicate that Canada is the least attractive location in which to invest, with a 5-year return around 12% vs. a whopping 39% in China and 22% for the world outside North America. If there are investment opportunities, companies will take their investment dollars to where they get the best return. Canada is one of the safest, albeit the highest cost environments in the world in which to invest. We can't afford to be complacent with the safety factor and assume that investment will go on as per usual and label an additional royalty grab as Albertans being entitled to their "fair share". A report that calls for significantly higher royalties and taxes while suggesting there will be no overall impact on industry, investment and growth makes no sense whatsoever in the investment world. The assumption that the pie will not change is erroneous and doesn't take the pressures on the oil and gas industry into consideration. First off, rapidly escalating cost structures, uncertainty over the future of Income Trusts due to Federal Government trust legislation, potentially more stringent environmental requirements and a rising Canadian dollar all combine to reduce realized pricing. It appears that the analysis was done with a 2005 cost structure, which does not take into consideration today's realities. What do you think will happen if the Royalty Report is adopted? Regardless of whether it is all or a portion, the oil and gas industry will suffer. So many of us are employed either directly or indirectly as a result of this sector it could have severe economic repercussions for Albertans. Favourable royalty structures incent producers to reinvest in these resources, from land acquisition to ultimate production. The government benefits from all aspects - look at the significant revenue that has been generated over the past 10 years in land sales alone - $8.6 billion over the last five years out of a total of $13 billion. There already has been a significant slowdown on investment in gas properties - what on earth do you think will happen to land pricing and all the leases that may be relinquished in in the very near future? Can our government be complacent that nothing will change? Can they afford to lose that type of investment? Can we as Albertans? The majority of the people who work in this industry do so with great personal integrity and concern for the environment and the future of the industry. They are not bluffing when they state they will shift capital outside Alberta wherever possible - BC or Saskatchewan will be net benefactors. If experts say the report is flawed, then the report is flawed. Fix it. Do we really want to see capital move out of Alberta? Do we want to see exploration by our junior producers dry up? Do we want to see oilsands investment funds go elsewhere? If this report wishes to truly maximize the return to citizens from resource development it should be revisited carefully. The panel needs to be reminded that we have some of the most challenging and costly oil and gas resources in the world. Without our royalty regime and taxation system taking that into consideration, our resources won't be developed; neither will the breaking technology for which Albertans are so famous, which turns marginal properties into cost-effective production sites. When activity goes down, 20% of nothing is still nothing and more of less is still less. Pierre Alvarez, president of CAPP, is right on when he states what elected officials choose to do with the panel's recommendations is one of the most important decisions ever to come before a government in Alberta and certainly the most important economic policy decision to be made in Canada this year. Whatever decision is made, however it is made, know that it will impact Albertans. If there are to be increases, make sure those revenues make it back directly into the pockets of Albertans via reduced taxes. Lastly, I find it disturbing that Premier Stelmach is turning this into his own political agenda, threatening to get tough with the oil & gas companies. And look! The survey says that the majority of Albertans agree with him. This is just another prime example of people with uninformed opinions who haven't bothered to do a risk analysis or any research into the findings of the report. Ignorance on their part does not necessarily constitute a good basis for political support - in fact, it looks a whole lot like greed! - but apparently this is the norm for many people.
RRE3173 What I'm not in favour of is a huge increase in royalties all at once. That is too onerous on generally the small and intermediate size companies who ,I understand, are proportionally the largest employer in the oil and gas industry and associated services. Secondly, the term " A Fair Share for Albertans" is misleading. Unless you send out a royalty check to me monthly or semi-annually, this is another tax grab by government that has historically wasted a lot of our dollars. As soon as the royalty income goes into government coffers, my belief is that a lot of that money goes to waste. Thirdly, I want our Alberta government to consider the new families coming to this province, the new homes purchased on expectations of job and industry stability. The government is destroying the perception of stability and creating undue stresses on working people. Maybe one in six works for the oil 'patch' , but instability of one leg of our society creates instability elsewhere -- don't be so focused on the oil side of everything, see the large picture. Lastly, leave the conventional side of the oil industry alone. The 25% royalty I read about is a pretty good chunk to Albertans when you consider that we also get paid in jobs, oil and gas leases and licenses and rentals, and of course income tax from jobs created by the oil industry. Sincerely...[Information Removed]
RRE3174 I think that the Government of Alberta has overlooked several impacts that the proposed changes to resource royalties would have on the industry and the province as a whole. This significant increase in royalties would very likely have an impact on the economic viability of developing Alberta's royalties. In recent times, due to Alberta's booming economy and oil and gas industry, we have seen a large migration of people to Alberta, contributing to Alberta's economic growth. A reduction in production capability due to gouging royalties would likely result in layoffs and cutbacks in the industry, causing people to then consider leaving Alberta in search of work. As well, the investment sector would take a large hit if these changes were to be implemented, which in turn also results in lost tax revenue for the province. I think the Government should reconsider these changes, not overlooking the economic and societal impact this could have on Alberta and its residents, to whom the Government is ultimately responsible.
RRE3175 I agree with the consultation report that the province should increase the royalties by at least 20%. Currently the province is not getting the fair share it should. By the way if there is some slow down - that may be a good thing since the Alberta economy is over-heated with housing prices too high, labour shortage and infrustructure behind. [Information Removed]
RRE3176 My message is short. Your expected increase in take for the benefit of "Albertans" will not occur because of reduced landsale recepits, reduced employee and corporate income tax and reduced property taxes due to foreclosures in most of the smaller towns in Alberta. You are risking killing your golden goose that most of your funding is based upon.
RRE3177 In regards to the Royalty Review: My husband and I have a small service company in the Oilpatch. We employee 9 people. Pretty much everyone we know is affected by the oilpatch one way or another. If drastic changes are made to the Royalty program I do think that it will have significant negative changes which will affect all Albertans. We have been in business for 14 years and find that as each year goes by we are finding it harder and harder to have the margins that are required to be profitable enough to continue. We feel that it will be devastating to the small to mid size businesses - service sector and exploration sector and would force many to exit the industry. We live and do business in rural Alberta. We would like to see Alberta and Albertans as a whole prosper and if the Government is not very careful in their decisions made concerning Royalties, the results could be devastating. We and many, many Albertans work very, very hard to maintain a business, employee people and give a lot back into our community and economy. It would be a shame to destroy the lives of so many due to Government greed and not come to some agreement with the oil companies to make it work for everyone..
RRE3178 Calgary Herald Friday » October 5 » 2007 Time to climb out of basement Wednesday, October 03, 2007 It's been 100 years since Vvisited Medicine Hat and claimed it had "all Hell for a basement." Observing a vibrant economy and natural gas streetlights burning 24/7, [Information Removed] metaphor described the reserves of natural gas that underlay the city. Since his visit,[Information Removed] "basement" in southeastern Alberta has been jackhammered with tens of thousands of low-productivity shallow gas wells. In the ensuing century, Albertans found out that their natural gas "basement" is a basin that extends like a ribbon all the way to the far northwest corner of the province. However, the gas treasures quickly became deeper, subtler and costlier to find. Entrepreneurs took the added risks and were occasionally rewarded with high-productivity, deeper wells that could produce hundreds of times more than the small wells Kipling observed. The plan put forth by the Alberta Royalty Review Panel (ARRP) challenges many dimensions of our longstanding, diverse natural gas business. While everyone is talking fair share, I think that the structure of what is being proposed is unsound and detrimental to our future. Alberta now has 107,000 producing gas wells. But after a century of exploitation, Kipling's basement is scrappier than ever and the big wells are much harder to find. Overall production is declining, which means the royalty pie is already shrinking. About a third of our natural gas production comes from high-productivity wells, two-thirds from lowproductivity, short-lived scraps. And that proportion is quickly migrating to the scraps as the costs and risks of exploring for harder-to-find, big wells escalates. Not all investors and their companies have the stomach or wallet to take a one in 20 chance to explore for a booming well, versus the nine in 10 odds for a scrappy one. To take on widely varying risks, Alberta has cultivated an operating culture for all sorts of companies: From risk-taking small companies to Big Oil. Like an ecosystem, each company in this corporate biodiversity contributes to the $18 billion spent each year on natural gas activity alone. What's troubling is that the [Information Removed] is proposing to heavily skew incentives toward lowproductivity gas wells. Shallow, short-lived wells with no backbone get a royalty break (and only under low, uneconomic prices), while prolific, long-life wells get penalized. The upshot is that the incentive to explore for gas wells will be lost under the [Information Removed] structure, drilling activity will fall, jobs will be lost and gas production will decline faster. None of this is a matter of if, but of how much. Do we really want a strategy that increases reliance on small, short-life wells for our energy needs? It's like a policy that penalizes big farms and moves us to become more dependent upon backyard gardens. Beyond economic impact, the character of our natural gas supply will be less secure and price volatility to consumers will be amplified. People against Big Oil should recognize an irony: The proposed plan will leave a landscape where large companies become more dominant as smaller ones disappear under a scheme that penalizes risk-taking. Multinational companies can selectively exploit our remaining resource, pay a one-time royalty, and reinvest profits outside Alberta where the economics are better. Conversely, small-to-mid-size Alberta companies -- those that recycle their profits back into Alberta instead of shipping it abroad -- will have great difficulty raising money to explore. Another problem: On an energy basis, natural gas will be burdened with higher royalties than oil. Why are we providing less incentive to look for the greenest fossil fuel at time when other environmental policies are encouraging us to consume more? And what is the makeup of the industry that we want delivering our fair share? What type of wells do we want driving our prosperity and ensuring our energy security? How can we shield ourselves from painful boom-and-bust cycles that affect us all? How can we provide entrepreneurs, like those who built this province, incentives to find the next generation of gas wells? It's naive to think that what the [Information Removed]is proposing will simplistically put another $2 billion in the bank without affecting anything else. Even in the absence of the [Information Removed]plan, our gas industry is faltering as it tries to compete against new low-cost supplies from the U.S. and abroad. And unlike oilsands, natural gas activity spans the entire province, affecting jobs in every urban and rural corner. I agree that we need to reassess royalty rates in the context of changing prices and costs, but not in a way that compromises our future and destabilizes what has taken 100 years to establish. [Information Removed]For The Calgary Herald [Information Removed] is chief energy economist, [Information Removed]., and author of the bestselling book, A Thousand Barrels a Second: The Coming Oil Break
RRE3179 Oils gone from 12 to 80 pbl SHould have an increase of 6 times .Albertans should be benefiting not foreign oil companies. Oil sands need to produce more royalties with a twelve billion plant would take a billion barrrels to pay for.Oil companies get their plant,interest production cost of 18 per barrel and at todays prices 50 bilion above the costs. Clearly Albetra is beinbg short changed. Never mind the 8 billion barrels of water to do this. Oil companies claim it costs 17 dollars a barrel to find oil.Oil sands did not have to be found so they are 17 barrell ahead to start. 1% MEANS NOTHING AFTER INFLATION. JOBS ARE BEING SHIPPED TO FOREIGN COUNTRIES, PIPELINES TAKING JOBS AWAY FROM ALBERTA. CLEARLY THE PC GOVT'S STEWARDSHIP OF THE OIL SANDS IS SUPECT. YOU CAN GO TO MEETINGS AND PROFESS TO KEEP JOS IN ALBERTA BUT AFTER THE MEETINGS NOTHING CHANGES.(FORT MCMURRAY MEETING) CANADIAN DOLLR IS STRONG VS THE FUNNY US DOLLAR BACKED BY 9 TRILLION INDEBT. BEST LOOK INTO THIS AS SELLING A DOLLAR OF OIL FOR 97 CENTS IS CLEARLY NOT IN ALBERTAS MAYBE IN TWO MONTHS WE'LL BE SELLING FOR 90 CENTS. EITHER YOU STAND UP AND BACK ALBERTA FIRST AND PUT THE OIL COMPANIES STRAIGHT OR YOU WILL NOT BE ELECTED NEXT TIME. [Information Removed]
RRE3180 I work in the oil and gas industry. I am concerned about our future here in the industry and also the affect it will have on the private sector. The way the economy is now our children will little chance of an independent future. If the royalty changes are made as stated now my future is also at stake. This will also cost low income families the homes they are having a hard time keep as it is. There will be a lot more homeless people and that won't help anything. A fair share of nothing ultimately is nothing. I do believe that some changes could be made to the royalty regime but not as drastic as the changes are now. Please reconsider your decision and consider what the oil and gas sector is saying. This is our future and it is also the future of our children/grandchildren and their families. Thank you for listening.
RRE3181 The Oil and Gas Industry should definitely share a larger portion of revenues with the tax payers of Alberta. I live in Grande Prairie, and have seen first hand how the Oil and Gas companies have reckessly spent money within it's own industry (I personally know several people who make $1500 per day, but do not even have high school educations), yet refuse to share outside the industry. I believe it is time that all citizens of the province receive fare share of those 'resource' dollars.
RRE3182 I don't think that the study has taken into account the major impact this will have on the economy of Alberta. It will not only impact Oil companies but there will be a huge trickle down effect to all sectors. When the large companies leave where do you supose all the people that have been laid off will work? They will then have no money to spend so all retail stores will also feel the impact. Not only that but who will fund non profits? Where do you think that money comes from.....Many large and small oil compaines donate large amounts of money, time, and items to non profit organizations and if there is no funding many more people will suffer. This paper does not take into account so many aspects of current business practice.
RRE3183 Dear Mr. Stelmach and Alberta Conservative Caucus My name is [Information Removed]I am 50, I live in [Information Removed] and have voted for the conservatives since [Information Removed]death and my father-inlaw [Information Removed]was voted in. I appreciate the openness of your current caucus and wanted to respond to this royality review issue. I feel strongly about this and I called my MLA ,the energy minister as well as the premiers offices and left comments, as well as this email. I am a pipeline, facility consultant and have worked the last 3 years for [Information Removed]. I caution to not do what was reported would be bad for the party as a whole. I work in the field and have a feel for what is happening with the oil and gas industry. I talked to [Information Removed]about this very issue 2 weeks ago and said Mr. Klien should have dealt with this 4-5 years ago but for what ever reason he did not , so now it has been left to you and your caucus and you will have to be strong on this issue . All these comments about moving money and project shutdowns in Alberta is sad. I personally have seen [Information Removed] doing this starting last October. The royality review has nothing to do with it . It is a world issue and the strong Canadian dollar. The oil and gas is in a recession due to this and will be unless we get a 80-90 cent dollar.It is not about the royallity issue, Ask the presidents of these companies how much they made last year and the profit they made,THEY CAN AFFORD THIS or leave the oil and gas in the ground the ecconomy could use a slow down to get it back to a slow and steady pace, The greed of the easy money made from oil and gas has corrupted people It has been to easy partly because they were not paying their fair share.If they do not want to invest in Alberta leave , leave it alone I am sure we will survive. I have 4 children and 2 grand kids This is not about me or my wife It is About getting a fair return for my kids and grand kids so we can lower taxes and have free education LIKE ALASKA for example.just to make a point. I have talked to many people and alot is riding for this government to stay the course. I am sure you are aware of the state of the agriculure sector they need help or they will be out of business, use the extra money from here to help them or what ever you and your caucus decide. All I know I support the full recommendations of this review and will decide what do do after the caucus has implemented their plan on this issue . Think hard on this ,but remember Alberta will survive and prosper with or without Encana and these other companies.I wish you well and look forward to your respond on this issue Kindest Regards [Information Removed]
RRE3184 Dear Premier Stelmach: I am writing in regards to the recently released Royalty Review. As an Albertan and an employee of one of the "Big Oil" companies, I believe this report has been long overdue and I believe this report has "hit the nail on the head". There is no doubt in my mind that the people of Alberta have been shortchanged by royalties from "Big Oil" as it is at "our" expense that they have made massive profits. The Alberta government ie: taxpayers paid for my skills training (education), healthcare, infrastructure all of which and more has benefited "Big Oil", yet they do not seem accountable on any level for the expenses we incur, never mind the irreplaceable loss of our natural resources including oilsands, water and air quality. I fully agree with the Royalty Review report in its' entirety and it should be fully adopted and not watered down. I believe in fact that it probably doesn't go far enough and I do not believe "Big Oil" will pack up and leave, in fact I believe a slowdown to get a breather and a plan in place for future developement would be beneficial to Alberta. These are "Our" resources and a fair price is only reasonable, as the overwhelming profits "Big Oil" is making is off of "our" backs and we must live with the consequences forever. By the way I have not heard of any mention of cancelling the Keystone pipeline to the U.S.A. which will literally pipe thousands of Alberta and Canadian jobs and our limited oilsands resources south of the border. Again, implement the Royalty Review in its' entirety, its' "our" ballpark. Regards; [Information Removed]
RRE3185 If you put this through all shallow gas work will be lost in Alberta. Many out of jobs. Losing houses. It sounds alot like the NEP. No votes from the oil and gas people next election. How about just leaving royalties alone.
RRE3186 It is with great concern that I am contacting you in response to the Alberta Royalty Review Panel's Report. If implemented by the government of Alberta as written, changes in the Royalty Structure will have immediate and serious negative impact on the future of the energy industry and the economy of Alberta. I ask you as my MLA, to make sure that the Legislative Assembly is fully aware of the negative consequences that will be in store for Albertan's should the recommendations of this Royalty Review Report be adopted. It is my understanding that the fundamental assumptions for certain capital costs which were used by the Panel to develop the Report, are low by a factor of 2. Accurate cost assumptions, which reflect the true costs of oil and gas exploration and development, are critical to developing royalty formulas. Because the present report is based on flawed assumptions, it requires significant review, hopefully with extensive industry input. Personally, I am most concerned because this Review, if implemented as is, will likely impact my ablity to make a living, along with the many thousands of other Albertans (93,000) who are directly and indirectly employed by the oil and gas industry. If it is not economic for companies to do business in Alberta (i.e. a profit cannot be made as a result of changes in the royalty formula) these companies will scale back operations or do business elsewhere, leaving Albertans without jobs and the Government of Alberta without royalties from oil and gas. Please, for all our sakes, do not support the changes that have been put forward by this Royalty Review Panel. [Information Removed]
RRE3187 I urge the government of Alberta to accept the report in its entirety and to raise royalties to the suggested levels. The governing party has for too long served the interests of industry, rather than those of the people. The resources belong to the people; the people should receive their due share so that we can save for the future and repair all of the damage that inept government policy has created.
RRE3188 Re: Royalty Review Panel Recommendations [Information Removed] conventional oil and gas producers in Western Canada, appreciates the opportunity to comment on the Royalty Review Panel’s recommendations and assist the Government of Alberta in making the right decision with regards to provincial royalty policy. Our comments are specifically directed towards the conventional oil and gas royalty structure and will emphasize several of the main points we made [Information Removed] Our comments below are summarized into 6 major comments: 1) Royalty takes by the Province should take into account returns on investment to producers to provide for maximum resource recovery. 2) Royalty changes should be phased in over time or grandfathered to maintain fairness and uphold Alberta’s reputation as a place to invest. 3) Simplifying the royalty regime and adjusting price caps make sense. 4) Operating pressures are significant factors for future development; the Province should consider paying their fair share. 5) Environmental impact of resource development should be a key objective, and as such CO2 recovery projects should be given special royalty incentives 6) An industry consultation process is recommended. An explanation of these key points follows: 1) Royalty takes by the Province should take into account returns on investment to oil and gas companies to provide for maximum resource recovery Our province needs a royalty system that encourages efficient development of our natural resources and recognizes the benefits the province receives from that development. The system must recognize the geologic constraints provided by the western Canada sedimentary basin and provide the economic incentive required to ensure that companies will invest the capital required to maximize recovery of our resources. The Panel’s focus on “government take” from royalties and taxes ignores the benefits the province receives from land sales and the spin off benefits from the economic activity. In 2006, Alberta received $4.3 billion from land sales, dwarfing the extra $2 billion increase in royalties the panel feels is required for the province to receive its “fair share”. Companies make land sale bids based on the expected economic return they will receive from development – if there is an additional $2 billion in royalties to be paid, the amount that can be paid up front for land has to decline. It is also fundamentally flawed in that it ignores the expected return on the capital invested from the company’s perspective, which is the real determinant on where companies will choose to invest their capital. Twenty years ago, all of the largest oil and gas fields in Alberta were in the hands of foreign controlled, multi-national oil and gas companies - Amoco, Mobil, Imperial, Chevron, Gulf and BP. Over the years, all of the majors have divested their interests in fields such as Pembina, Swan Hills and Redwater because the expected returns on investing capital to continue to develop these fields was less than they could get elsewhere. Today, large and even smaller Canadian companies look to the oil sands or to international opportunities for growth in places like Libya, Algeria, Egypt, Argentina and other countries with much higher government take than Alberta but with a much higher expected return on investment. This is summarized in the attached graph by J.S. HEROLD: The proposed royalty structure will significantly reduce further infill drilling in older oil fields and result in a corresponding reduction in the oil recovered and future royalty barrels for the Province. Considerable thought has gone into the current royalty legislation in order to align industry and the Province’s objectives to maximize recovery rates on both gas and oil fields so there is more production and then wealth to share. The Panel’s proposed royalties will not maximize recoveries. New infill wells drilled in old reservoirs typically come on at production rates significantly higher than that of the adjacent older wells in the field. These new infill wells may initially produce at a high rate for example 100 barrels per day but then decline significantly over the next 6 to 12 months to eventually produce at rates ( 20 barrels per day) similar to older wells in the reservoir. Oil and gas companies require this initial “flush production” to justify the economics for the capital expenditure. The proposed royalty rates by the Panel puts the Province royalty take at close to 50% for infill oil wells producing more than 100 bbls/d in the current oil price environment. This could significantly reduce future infill development causing a larger than expected future decline in the Province’s royalty revenue. We need a royalty system that encourages continued development of older pools, not one that discourages it. For continued resource development, our province needs a royalty system that is fair for the people of our province and for the companies who have invested the required capital into resource development. As a management team, we need to be responsive to all our stakeholders – employees, creditors, royalty holders including the Province and shareholders. Shareholders, which include many Albertans, have many alternatives to where they can invest/deploy their capital. As management we must recognize our need to provide acceptable returns to compete for capital investment with other opportunities world wide. It’s not about “government take”, it is about expected return on investment. 2) Royalty changes should be phased in over time or grandfathered to maintain fairness and uphold Alberta’s reputation as a place to invest We need a royalty system that recognizes the challenges presented by operating in a mature basin as stated above. It is well documented in the Panel’s report, Department of Energy statistics and corporate submissions in the royalty review process that the WCSB is mature and production is declining. Declining production will reduce the profitability of oil and gas producers even with higher commodity prices. With this environment the Province should be sensitive to the time frame for the introduction of any additional royalties. The Province should also consider the fact that prices paid at land sales for mineral rights were predicated on the existing royalty structure and an immediate increase in royalties would not be equitable. The Panel’s summary report states the government take would increase by approximately 20%. However when we look at specific types of production, such as the royalty rate on low productivity oil wells producing in older fields the summary table in the report shows increases in excess of 50% in royalties payable at current commodity prices. This would be too dramatic of an increase to occur at any one time. In order for the Province to maintain its reputation as a place to invest any increase in royalties should be phased in or grandfather so that an orderly development of the resource can occur. For Alberta to continue to attract the capital that will be required for efficient development of our resources we a need stable royalty system that investors can trust. 3) Simplifying the royalty regime and adjusting price caps make sense. A significant portion of the Panel’s report is dedicated to the fact that the royalty regime is overly complex and the formulas involve out of date price caps. We would agree with these comments. However we would urge the Province to take this opportunity to address all the issues of the royalty regime such as acceptable rate of returns for producers. Additionally the Province should consider items we discuss later which include the Province sharing in operating costs and the creation of programs to encourage the capture of CO2 and injection into existing oil fields to further enhance resource recovery. 4) Operating pressures are significant factors for future development, the Province should consider paying their fair share The Panel assumed that the royalty formula or royalty rates can be adjusted to compensate for rising operating costs. We disagree with this assumption and believe this will be a larger and larger issue as the WCSB matures. We urge the Province to take this opportunity to allow for the deduction of operating costs for conventional oil and gas at the same time as increasing the price caps in the royalty formulas. This would align the Province and producers economical position on existing oil and gas wells with the objective of maximizing future production and recovery from the reservoir. As part of this recommendation the province should discontinue taking their oil production in kind and be paid a cash royalty to substantially reduce administration for both the Province and producers. The panel suggests that “it is management’ s responsibility to control costs” and that if we did our jobs better we could absorb the higher royalty rates. These comments are insensitive and insulting and clearly were not made by anyone who has recent experience in running an oil and gas company. With 70% of our operating costs being fixed, as well productivity decreases it is inevitable that operating costs will increase as costs have to spread over fewer and fewer barrels as production declines. The panel recognized the importance of lower royalties for low rate oil and gas wells but forgot about the overall impact of increasing oil royalties by over 50%. In addition operators have little control over many components of operating costs. For example key drivers of operating cost increases are electricity and municipal taxes. Operating costs jumped significantly this July to over $155 MWH from an average of $57 MWH for the first six months, when electricity prices surged as a result of lack of electrical generating capacity to meet peak demand times. Electricity costs are key component of operating costs and not within the “control” by producers. Secondly municipal tax costs are increasing. Municipality budgets are stretched to render services to their residents. Municipal taxes paid by the oil and gas sector in a number of municipalities accounts for a significant portion of the overall tax base. With the maturing of many oil and gas fields in Alberta annual per well production and total field production is declining but the annual municipal tax bill is increasing – the net impact is another significant “uncontrollable” operating cost which is steadily increasing. The proposal for the Province to share in operating costs would provide fairness and equity, moving price caps to provide a fair return for the people of Alberta and the Province paying for operating costs on their portion of production would assist in ensuring industry has acceptable rates of return. 5) Environmental impact of resource development should be a key objective, and as such CO2 recovery projects should be given special royalty incentives ARC is one of the leading companies in examining the use of carbon dioxide (CO2) injection for enhanced oil recovery in Alberta’s mature oil fields. Under the right economic conditions, we estimate that there could be 100 million barrels of incremental oil recovered from just our interest in the Redwater and Pembina oil fields. These projects including the cost to capture and transport the CO2 are very capital intensive. There are numerous variables such as the future cost of CO2 that need to be determined to ascertain the return on investment of these projects. Increasing the royalty take on these projects may make them totally un-economic, leaving millions of barrels behind. Upfront royalty relief on enhanced oil recovery (EOR) capital spent including the cost of the CO2 will be important in order to justify the capital investments into CO2 infrastructure. A project payout royalty regime similar to oilsands would be one suggestion in enhancing the economic viability of CO2 enhanced oil recovery projects. 6) An industry consultation process is recommended While oil prices are at record highs, gas prices are dropping. Our industry has been hit with a 31.5% tax on royalty trusts, the elimination of accelerated capital cost allowance for the oil sands and rising costs in Alberta. With these challenges, it is no wonder that exploration and development drilling activity in Alberta has plunged to levels not seen since 1999, now is not the time to impose a dramatic royalty increase. An more rigorous industry consultation process is necessary to ensure everyone agrees on the “facts” and are made aware of the real costs of business and current rate of return for oil and gas producers. The Panel has brought a number of issues to the forefront which need to be addressed in a timely manner. We urge you to initiate an industry consultation process for the benefit of the people of Alberta. A royalty regime that provides for the “fair share” to the Province while at the same time providing acceptable rates of returns for oil and gas companies will be the optimium solution for the people of Alberta. The acceptable returns will mean ongoing investment, jobs, contracts for the service sector and the maximum resource recovery – a win-win solution. We support the Province’s carefully reviewing of the Panel’s conclusions and supporting data and the expansion of the review to cover all business aspects such as costs and full cycle economics. The objective of this royalty review should be to ensure the continuation of the successful partnership of the Province and energy sector into the future. Sincerely, [Information Removed]
RRE3189 i think we need to bring back old man ralph,klein,at least he had a clue on what he was doing.
RRE3190 These changes should be implemented carefully and after a collaborative, in-depth consultations process similar to that followed to create generic fiscal terms for the oilsands a decade ago. Before implementing the current proposals, the Government needs to fully understand the impacts of proposed changes so that we do not stall Alberta investments.
RRE3191 The proposed tax increase causes a disproportionate burden on smaller companies, particularly those trying to get joint venture capital. This taxation has the potential and likelihood of killing several projects before they get off the ground. The capitalization costs for startup ventures is large. This is a disincentive to investors and joint venture capitalists.
RRE3192 The oil compnies do not own Alberta. I would be appaled if we were to bow to their threats of "withdrawal of investment". The resources will always be there. We have a prblem with an overheated economy. Why on earth would we listen to idle threts? Let them go to Venezuela and be nationalized, or the Arabian peninsula nd get terrorized. Tell them to go to .....
RRE3193 Dear Minister, I believe that the key issue for tar sands development is infrastructure. The production capacity is increasing by 30,000m3/day on an annual basis. The gas consumption is approximately $4 billion per year and will grow to $8 billion per year in five years (assuming that the gas price stays depressed). Roughly one third of the energy content of the sagd bitumen is spent just to get the bitumen out of the ground. The R-C formula provides that all gas costs are expensable so consequently fuel costs represent a direct loss of revenue/royalty/income to the province. If the infrastructure lifetime is 30 years, this implies that each year, the additional 30,000m3/day of new capacity also brings a future fuel gas cost liability of about $20 billion dollars. This is simply the gas cost to run the new plant facilities over its useful lifetime. Thus, the opportunity cost of building inefficient infrastructure is about $20 billion per year (assuming a process could be developed to completely eliminate gas consumption). Note that this completely dwarfs the $2 Billion per year being discussed in the context of the royalty review. I have a suggestion. The current CO2 tax is a factor of 40 to 70 times too small to justify any useful capital investments such as carbon capture and sequestration. If the royalty tax increase for the oil sands was implemented as a tax on CO2 emissions, then this would have the triple benefit 1) Encouraging investment (i.e., construction) of more energy efficient processes 2) Reducing environmental footprint (i.e. GHG emissions) of oil sand development 3) Reducing future fuel cost liabilities and consequently providing Alberta with better profit margins and royalty payouts from future oil sands projects This would provide the most leverage at the precise issue that limits Alberta’s ability to benefit from oil sands development. A high carbon tax would allow the government to have its cake and eat it too. The oil sand “royalties” could be kept the same, but economic rent increased in a way that specifically targets inefficiency in oil sand operations. This would please the taxpayers who want more revenue, please the people concerned about environmental damage and future fuel liabilities and please the oil companies because the tax is somewhat avoidable so they can be financially rewarded for being socially responsible. Cheers!
RRE3194 Dear Premier Stelmach; We are writing to you today as two very concerned Alberta citizens. We have a number of concerns, including the prospect of a nuclear power plant being forced on the citizens of Alberta, as well as the rampant progress of industry, and the destruction of rich farmland, wetlands and natural green spaces in the service of urban sprawl. Every day our water becomes more scarce and polluted, our air more foul, and our climate more erratic, all in the name of providing increased profits to industry. We are writing to you today to remind you that the purpose of a government is to safeguard the interests of the public by protecting public commons: our air, water, land, and all of our natural resources. These things belong to all Albertans, not just to industry. A government is commissioned to be the steward of these resources, on behalf of the people. We take our own personal stewardship of the planet very seriously, and as such have undertaken the challenge to reduce our household’s energy and commodity consumption, and our resultant greenhouse gas emissions by 90% of that of the average North American household. This is the level of reduction that George Monbiot, in his book “Heat: How to Stop the Planet from Burning” recommends as a measure everyone will have to undertake if we are going to minimize the now inevitable effects of global warming. We have not yet achieved this goal, but we are working towards it daily. As persons committed to doing our part, we ask you to do yours: Ensure that industry pays its fair share of royalties to the people of Alberta for the privilege of making a profit from the “trust fund” that is in the ground and belongs to all of us. Fossil fuels were created over hundreds of millions of years. Humanity has been using them up in just a few hundred years. That is, we are burning them one million times faster than they were created. Concomitantly, we are putting carbon into the atmosphere a million times faster than it went into the ground. If the oil industry has to slow down its extraction of this resource because it is only permitted to make a decent profit instead of an obscene one, this can only be a positive result for Albertans and for the well-being of this one planet we all share. Thank you for weighing our concerns, ones shared by many Albertans young and old, in your decision-making process. Sincerely, [Information Removed]
RRE3195 If oil companies are balking at this royalty review report and threating to cease new production, then the government must step up and listen. The oil industry already affects Albertans. If new growth continues, and Albertans and other Canadians are employed, the money still remains in Alberta's economy. Taxes are coming from the sale of the product and the income that Albertans are earning. If Albertans are earning less the government stands to lose in the long run. This win-win situation must be encouraged and the money grabing has to stop. Everybody seems to want a piece of this, and Oil and Gas companies have already shown they have to power to fight against money grabing actions. When costs rose due to shortage of workers, companies raised thier rates to compensate, then raised them again simply because they could. The slowness of the Spring and Summer in this industry appears to be a direct result of the companies showing the service companies who had raised thier rates to riduculous levels that it would not be tolerated. My opinion to the government is back off and not join the money grabbers. If any government interference is to happen is should be to regulate wages and the rising costs of living in Alberta due to the money grabbers who "just want to get thier share".
RRE3196 The Government and industry ahve to come to a comprimise on this issue. I was very shocked at the Royalty review that was done. if all recommendations are implemented we will see many Oil Companies cut back there capital spending in 2008. Things will definetly slow down and the unemployment rate will increase. I know the government is trying to get a bigger piece of the pie but i hope they don't believe the pie will be the same size, it won't. it won't just affect the oil industry but it will effect everyone, places like Lloydminster and Bonnyville where the Oilfield keeps the town alive will see major changes. it is not looking good for Albertans at all, I thought our government was supposed to do what is best for Albertans. Everyone is complaining about how much the Oil Comanies are Making with there record profits, has anyone taken a look at what they are investing (Record investment) the more you invest the more you should make. I think the whole royalty structure is fine the way it is. Alberta is out of debt because of the Oil industry, we have the Highest paid nurses in the country, It is not as if we can't keep up with the road maintanence, I really wish i could hear the governments reason for changing the Royalty structure. The Oilfield has carried alberta to where it is now and how do they thanks us charge us more to produce oil.
RRE3197 Until recently, my mom and dad owned a small motel in the rural village of Alix, Alberta. The majority of their business came from people staying in the area while working at a local gas plant, on construction projects or providing other oil and gas industry services. They relied on this business for the livelihood, as do many other local business. These small communities rely heavily on the o&g industry to support their local economy - the coffee shops, restaurants, grocery stores, etc. And many farming families would not survive a drought, or something as disasterous as mad cow, without lease payments from oil and gas companies drilling on their land. These oil and gas companies also support our communities by funding education programs, health care facilities, roads, building playgrounds; their employees live in these communities, they act as volunteer firefighters and emergency medical technicians... If the royalty review report is adopted in full, oil and gas companies will take their investment elsewhere to areas outside the province, even outside Canada, where it is more economical to do business. Along with them goes our thriving economy, and thousands and thousands of jobs for Albertans. I agree changes are necessary and the government needs to review the current structure. But we need a solution that works for everyone, including the government, the industry, and all Albertans!
RRE3198 If the panel recommendation is implemented the province will go backwards for several years. Take more from the oil sands but leave the conventional production alone.
RRE3199 Don't give in to the oil companies on th royalty review. It is our resource and could still be there for our children if it is managed properly. In addition Mr Stelmach, Give Edmonton a fair peice of the revenue pie or you won't get our votes and I have voted for the Tories forever!!!!
RRE3200 Given the history of Alberta's need for workers, a significant portion of present day residents of this province voicing an opinion on this royalty issue are not genuine "Albertans". An Albertan is an individual who values self reliance and recognizes the importance economic freedom. It is collectivist ideology that destroyed the economies of where these supplanted workers. Further, this same ideology has destroyed the spirit of the people living there. As the last bastion of freedom remaining in this once proud country, Alberta owes to itself the honor of preserving what is right and rational. Parasitical value destroyers, having suckled the lifeblood of other provinces and crippled their economies, need to be given a strong and direct message: THIS IS ALBERTA, the reason we are prosperous is because of the freedom we endorse and treasure. If you do not value freedom, leave, go back from where you came, you are not welcome here.
RRE3201 The recommendations in the report are far too timid, and do not go nearly as far as they could or should in terms of capturing fair value for Albertans' resources. Implementation of the panel's full set of recommendations is the absolute minimum the government should do.
RRE3202 Sound like everyone is chasing the "hen that lays the golden egg".! I hope our government will recognize that if the oil sector is overtaxed or too much royalty is taken, it will do more damage on the long term then the benefit will bring on the short term
RRE3203 Thank you for doing this much needed review. Now I hope you have the courage to follow the expert advice. If it does slow down the acceleration of development so much the better. Oil will never 'go out of style' nor in the long run go down in price. 'Saving' it in the ground as a heritage for future Albertans is an even better investment than 'money in the bank'. In addition time will allow technologies to develop to get the oil out of the tarsands with out so much environmental damage.
RRE3204 We need to IMPROVE investment longevity in Alberta by Oil and Gas producers, not hinder it. the proposed royalty changes will damage our economy now, and in the future. Put a end to this discussion soon, even talk of it is already hurting us. It will trickle down to all areas of Alberta's economy.
RRE3205 I disagree strongly with the Royalty recommendation. I think the basis is flawed in using drilling costs and gas pricing during a very short boom in the 2005/2006 period. Investment has been noted to have dropped by over $2.5 billion from 2006 to 2007 by the likes of Encana, CNRL and ConocoPhillips alone with these companies and others already on record of decreasing investment by another $2 billion in 2008 from this already reduced level. This all at a time when costs to drill/complete/tie-in wells is at record highs and natural gas prices are below breakeven levels as reported by investment analysts. Please review the facts, this recommendation if passed will cause an economic downturn similar to that experienced in the early 80's when oil prices dropped (as gas has recently), currency exchange rate is at all time highs and the Calgary/Edmonton housing market has doubled in the last few years. Remember the drop in house prices in 1983 - in Calgary from $225,000 average to $120,000 in a year and it took 22 years for the average price to recover to $225,000!!! Please don't be the cause of this occuring again. Get the facts and ground your decision there, not in the political merits. Consider that economic business decisions have been made for multi-year capital investment in oil sands that should be grandfathered, consider an after profit royalty to preserve investments for the future. Thank you, [Information Removed]
RRE3206 I am sending this email to you with respect to Alberta Government's release of Our Fair Share: Report of the Alberta Royalty Review Panel, which recommends considerable changes to the current royalty regime in our province. I feel that it is important for me to share my views of what I see within the report and would appreciate any feedback from you. The report and the purported impact of the recommendations it contains are not accurate; flawed data and poor assumptions ignore how the oil and gas industry operates. Differences between the Panel’s assumptions and industry’s are significant. This equates to inaccurate impact analysis, where the Panel’s forecasts for industry activity and investment are biased and more positive than what actual industry members and investors believe possible. The government needs to ensure that any policy change is based upon real-world industry economics. • We need a wiser decision for Albertans and our energy industry. Albertans rely on a vibrant energy sector for our economic well-being. If the proposals are enacted, Alberta’s energy industry could be at risk. Financial markets around the world are concerned about the stability of Alberta’s energy industry in view of the potential political uncertainties related to royalties. This uncertainty has already been reflected in energy company share prices. • Significant and long-term energy projects have been planned for Alberta based on the current royalty regime. Major changes could jeopardize these projects and reverse the province’s economic growth. Therefore, the government should reject the Panel’s recommendation to disallow grandfathering. This action will help to preserve the long-term economics of these projects and ensure the continued development of Alberta’s natural resources. • Alberta is an economic generator and leader in Canada even with royalties at the current level. While some increase may be fair, a large change will reverse the economic development and prosperity of the province. • The proposed changes would have significant, immediate and long-term economic impacts across the province. If energy projects are impacted, Alberta will experience a loss of capital spending, infrastructure, and people. Fewer jobs will exist, impacting not only those directly employed in the energy sector, but also those businesses across Alberta that indirectly support and rely upon continued industry activity for their prosperity. There will be less exploration and development, fewer wells drilled and fewer pipelines constructed. In turn, there will be fewer hotel bookings, retail and vehicle purchases or rentals, and decreased restaurant and related retail service sector activity. The Panel’s recommendations do not appear to take these factors into account. In conclusion, the Alberta Government should not rush this important policy decision. Implementing a policy that is predicated on inaccurate information and assumptions, and with a lack of proper consultation, is not in the best interests of Alberta. We need to get this right. As an industry we are ready to begin working towards solutions based on a framework that: • Let's us all share in the upside without penalizing the downside • Reflects the characteristics of the basin and differences between play types o For conventional - small size of discoveries, low well productivity, and emerging unconventional resources o For Oil Sands - unique resource, high cost • Ensures adequate notice and transition for any major change • Provides certainty so investors will be confident in the rules
RRE3207 Dear Premier Stelmach, Please be strong. While the "oil and gas " propaganda machine" is in overdrive, please don't buckle. Why should Encana make 8 billion dollars profit on the back of Albertans last year and why should Albertans be short-change 6-9 billion dollars as the AG calculated? In the unlikely event of one company scaling back, there will be 10 coming in to take its place. We do not need to give away our wealth and our future at fire-sale prices. Please be strong. Get us our share. [Information Removed]
RRE3208 I totally agree with the group decision about us not receiving our fare share. Albertans are already taxed enough from city, municipal, and provincial taxes that as hard working citizens, we all deserve a break as it belongs to all of us in the first place. I agree that Alberta should take any additional monies deemed from the big oil companies as it is our natural resource for all Albertans
RRE3209 If this Royalty plan is signed,it will kill a whole lot of small companies like mine. I own 1 oilfeild truck that I use to move drilling rigs.It has already been a slow summer just because of this Royalty B.S. I voted for this government, and I am ashamed of that. All of the taxes I have paid and all of my hard work will go down the drain if this law royalty passes
RRE3210 My name is [Information Removed]. I live and work in Grande Prairie. My job is supported by the energy industry and I am deeply concerned about the recent royalty review panel findings. I do not believe that the panel review was done with the proper personal or finiacial data. I have read many reviews from private third party finacial companies and believe further work needs to be done on royalty increases. I do support increases to royaltys based on educated decisions that are envoked when prices are high. We are currently experiancing very low gas prices and the Grande Prairie region is driven by gas development. More effort should be put forth to plan a royalty tax that is based on commodity prices, not a broad sword approach to hit all production. I stongly believe that your waffling on this issue is hurting our livelyhood and you need to act quickly on this decision. What ever your decision is will determine your support in the province and I know that your support will weaken by a least one vote here if you push this through. You are not doing the job we asked of you and you are employed by the people, the people will get the last vote, just ask our former mayor Mr Ayling.
RRE3211 Please Review the Proposed Royalty Changes as It will impact our Province greatly. I've heard that some Oil and Gas companies are thinking of investing in the Industry elsewhere as the Alberta Royalties will be too high for these companies to get a good return in order to invest more in our Province. Please don't let this happen. Albertans have worked very hard to get to where we are at, lots of job opportunities and a good future. The Oil and Gas Industry has offered a lot of jobs to Albertans, and if Oil companies decide to cut back spending in Albera that will be the end of a lot of jobs in our Province.
RRE3212 Good Afternoon, I am deeply concerned about the proposed royalty changes being considered for implementation. I have reviewed many articles and reviews on the proposed changes, and my primary concern is that the review committee did not have the correct or current information to determine what "reasonable" increase in royalties the industry and economy could bear without negative effects. It does not appear that enough industry and economy experts were consulted before the recommendations were made. I have serious doubts about the increased taxes being of more benefit in the hands of the government, than they currently are with continued investment in Alberta communities and our economy. Rural areas and cities alike rely on oil & gas related employment and, in turn, the local investment of these employees in their communities. It is also strange to me that this review is coming at a time when there has already been a downturn in the industry, resulting in less drilling and investment. The industry has to be able to survive the regular increases and decreases in the market, and increasing taxes during a low period by a such a significant amount (imagine how increasing your personal income tax suddenly by 20% would affect your spending) can only have a negative effect on the viability of many of the smaller companies in particular, and urge the larger companies to look elsewhere for investment projects. I urge the government to postpone any increases in royalties until a more accurate review, with proper consultation with industry experts, economists and business, can be completed. I am not opposed to changing the current royalty program, but it must be done in a way the is good for everyone in the short and long term. Regards, [Information Removed]
RRE3213 I think the rate should be raised, look at the record profits the oil companies are making. They have lots of room to safe money as money seems to be of no object these days. Also Alberta is run by the government which is elected by the people and not run by the oil companies sitting in Calgary.
RRE3214 If is is true that we have not been receiving our fair share of royalties then they should pay more. But perhaps a solution to bridge the sides would be to say gradudal increases every three years until we reach the royalty rate we believe they should pay. It is a non renewable resource of Alberta and it is important that we receive fair value so that we can save money and support our citizens. I don't want to discourage oil companies from doing business here but they need to be fair to us.
RRE3215 After reviewing the royalty review report from the Royaly Review Panel, I have the following suggestions / comments. I am concerned the review does not take into consideration the potential reduction of investments in Alberta from Oil & Gas producers. The new royalty regime appears to create significant fiscal challenges on an already challenging fiscal industry. I am concerned about the long term impact that this will have on the future of my children in this land of incredible opportunity. I recommend the government spend more time trying to understand the potential impact to the economy and industry that sustains it. Four recommendations to the Government of Alberta include : 1) The fiscal terms for existing projects should be honored, 2) The current Royalty Adjustment Program for Deep Marginal Gas Wells should be maintained, 3) The thresholds for the sliding rate royalty scales for gas must be adjusted to be consistent with breakeven costs 4) The Oil Sands Severance Tax should not be implemented. Sincerely, [Information Removed]
RRE3216 I think raising conventional oil and gas royalties at this time is a terrible idea. Hitting an already battered industry struggling to recover from high costs and the federal gov royalty trust policy will not help the prosperity of Alberta.
RRE3217 Our schools and social agencies are underfunded. They are receiving less dollars now than in previous years when inflation is factored in. For all Albertans to share in Alberta's prosperity, rather than a select few, and for this government to continue to receive the confidence of the electorate, this govenment must invest in current supports for all Albertans and in the future for all Albertans through investments in education. To accomplish these laudable and necessary goals, the government needs money. An additional 2 biliion dollars a year in royalties will accomplish these goals as well as leaving a large annual sum for savings for the future. The government will then fully earn the continued support of the electorate. The government must follow all of the recommendations of the royalty review panel to ensure that current and future Albertans will share in the "Albertan Advantage" [Information Removed]B.Sc, B.Ed., G.D.R.E.
RRE3218 I have reveiwed statements given by CAODC and Canadian Natural as well as the Royalty Review and I have to say that the Royalty Review is a terrible thing for the province of Alberta and I can see the province actually receiving less money in royalties if it passes it because companies will take their business outside of the province. If this passes you will see BC, SK and the states benefiting, not AB.
RRE3219 Hello: What is the government thinking? Does it not realise the ripple effect that the Royalty increase will have on the economy. Not only will the employees of the oil companies be effected but also every other business in the province. With the increase in the Royalty revenue who will reap the rewards of it. Will we see our politicians get pay raises or bonuses. Where will that money go, will our taxes decreases. Allready people are dicussing walking away from everything that they have. How will family life be affected with people losing there jobs, its very difficult now trying to raise a family, as a single mother it only makes it ten times harder. It's time the government realises that its a voice for the people and the people do not want this to happen. Thank you [Information Removed]
RRE3220 Before I respond to anything related to this report, I would first like to know who the Panel consisted of and do any of these persons have any oil and gas background as far as working in the industry is concerned. Thank you [Information Removed]
RRE3221 Hello, I believe it is imperative that Albertans be receiving the maximum amount of royalties that we can extract from the oil and gas industry. I hope that the government of Alberta can see that we need to use our current resource wealth to build an Alberta for our children and grandchildren instead of just for today. As our oil wealth is limited, we will need all the royalties that we can gather to fund the diversification of our economy and build the infrastructure necessary for the future. Increasing the royalties will help to compensate Albertans for the environmental impact of resource development, and provide a mechanism to encourage development at a more sustainable rate. I implore the government of Alberta to not sell our future too cheaply. Thank you [Information Removed]
RRE3222 It is my opinion that increasing the current royalty rate could potentially continue the current cooling of the oil and gas industry. Right now there is a great balance between creating an environment that encourages investment and royalty collection. If the rate of royalties increases it could potentially make many projects, which are economically marginal right now, uneconomical. Therefore, oil and gas companies could react to the unfriendly government intervention and cancel those projects. Overall this plan could result in an actual decrease in royalty revenue. Listen to industry, listen to the experts in business, listen to the professionals who know how the economics work and have proven it by making lots of money. Thanks
RRE3223 September 28, 2007 [Information Removed] Attention: Mr. Ed Stelmach and Mr. Lyle Oberg RE: Alberta Royalty Review I am a born and raised Albertan (4th generation Albertan) who is very concerned about the impact of the proposed Royalty Review. Although I am not an expert in this area, I feel it is important to send my thoughts on this issue in consideration of all Albertans and of course my family and parents who I assist financially. I was raised in a blue collar family where my dad did construction and worked for over 50 years contributing our province including building the ski jump and ski lift for the Calgary Olympics in 1988 and the PetroCanada Towers (many other contributions in Edmonton and isolated camp jobs). Just to paint the picture that we are regular folk who lived in the low income neighborhoods and are not greedy people. In understanding our economic situation with the cost of living in Alberta, the unemployment rate and various other statistics and concerns regarding infrastructure, poverty increases, etc. with the current proposed Royalty Review there will be a huge impact to the future of Alberta and impact on Canada as a whole. In simplistic terms I believe that if the province requires more money for infrastructure planning etc. that there is a better way to plan for this. I truly believe that this will directly influence a domino effect to a recession including significant job loss, unemployment and huge increases in poverty. I am in a support level position within the oil and gas industry. Our operations include drilling of deep wells with the anticipation of larger production volumes. As this type of company in the industry, the cost to drill such wells is astronomical in comparison to our peers and without significant consideration to the costs to produce our company will not succeed. I am sure all producers will be impacted in a very similar fashion and all will mirror the direction of [Information Removed] and substantially reduce operation budgets to try to save their companies. This will lead to lay-offs. With the Western Canadian Sedimentary basin being near depletion, costs to drill will continue to increase in the future as well. Then there is the service sector in oil and gas. Not only are we at record lows for drilling for the past few years, there have been companies that have not succeeded in the patch as there is not enough business for O&G service companies to be busy. With this proposal, companies will further reduce drilling and completion plans for years to come. Need I explain more? As an Albertan, I have taken my hard earned money and invested in local organizations (Alberta based companies) for my future and for living expenses for my family and parents. I cannot be prepared to loose my investments in assisting in the growth of our province and change to non-local investment strategies. I have invested in various companies that I have worked in because I believe in them. I also believe in our province and its leadership and hope that the decisions moving forward are in the best interest of the people. This may sound selfish however there are several people that are in the same situation as I. Please consider the seriousness of this initiative? Considering the changes within the Trust sector, this industry cannot withstand another hit like this. Thank you, I appreciate your time and I hope that what I have expressed is considered and not just another letter. Sincerely, [Information Removed] Cc: [Information Removed]
RRE3224 Most Albertan's are employeed through the oilfield and if these new oil royalties come into affect many of us will be out of work! Are you looking forward to being unemployeed? Because I'm not!
RRE3225 Dear Honourable Mel Knight, I am writing you to stress my concerns with the 'Our Fair Share' royalty review report recently submitted to the Alberta Government. The recommendations in this report, if adopted, have the potential to put the entire Albertan economy at risk. Although the intentions of the report and evaluation of the current Royalty system can only be viewed as a positive initiative, it needs to be recognized that the stakes are extremely high. The Albertan O&G industry has not only become the 'Golden Goose' of the Albertan economy but it is also driving the current success of the Canadian economy. The main concerns I have with the 'Our Fair Share' report are as follows: Inaccurate Capital Cost Assumptions = Misguided Recommendations - The Panel's base capital cost assumptions used to develop their recommendations are significantly understated (by a factor of 2). The credibility and analysis of the report recommendations requires significant review. - By substantially increasing the Royalities on the oil sands, there is significant risk that new projects will be cancelled and future expansions scaled back, delayed or cancelled. The high cost environment has already made these projects marginally, this Panel's recommendations would be a finishing blow. - The Panel's statement that 82% of natural gas wells will pay lower royalties is based on the assumption of continuing low natural gas prices. In fact, if evaluating with the current one year natural gas price, all wells will pay higher royalties (including the marginal wells). Considering that the majority of new wells throughout Alberta are considered 'marginal', many wells across the province will immediately become uneconomic. Alberta becomes an unstable investment environment - Changing the 'rules of the game' mid-way through the completion of existing approved megaprojects is akin to the mode of government interaction with business in more unstable region of world, such as Russia, Venezuela, and Kazakhstan. Investors and foreign directed investment (FDI) money will start to look elsewhere if Alberta starts to be classified as an unstable investment environment. Once investor money starts to flow away from Alberta it will not be easy to bring it back. The long period of time required to recover from the National Oil Program in the 1980's should serve as an example. Changing Definitions will leave Primary Production in the oil sands areas uneconomic - Eliminating the primary production in the oil sands area from the Oil Sands Royalty program will dramatically change the economics of continuing this form of production in many areas across Northern Alberta (such as Bonnyville, Elk Point, Cold Lake, Lloydminister and Slave Lake/Wabasca). The cost of developing Alberta's resources is already high relative to other O&G producing regions of the world. The 'technically challenging' nature of Albertan resource development is indeed costly but it is also a great generator of employment. The reduced activity that would result if the 'Our Fair Share' report recommendations are adopted would lead to significant unemployment and reduced economic activity. Please ensure that the capital cost assumptions which creates the basis for this report are scrutinized and vetted with the Oil and Gas industry prior to considering the Panel's recommendations. Accurate cost assumptions are critical to developing appropriate models to evaluate future impacts and ensure no unintended consequences. Yours truly, [Information Removed] Calgary , AB [Information Removed]
RRE3226 It's obvious from the small space you've provided for anyone to express his views that you're not really interested in it! So - for the record - the oil companies are pirates in suits. We have a relatively low royalty rate (from what I've been told-the lowest in the world). Time for them to pay their fair share - and give us some of our money back.
RRE3227 I think that the review is correct in that Alberta is not getting as much of the profit from the oil as they should. I think the government should take steps to get more of the monny that is owing. However I have always believed that the oil in Alberta belongs to the citacins of Alberta, and therefore we should all be sharing in the profits, in the form of an anual rebate. Yes, some of the surpleses should go to infastructure and education, and things like that, but some should be set aside for rebates to the tax payer. As for those who say that they don't want a rebate, fine don't give them a rebate. There are a lot of tax payers out there that are living from one paycheck to another, or are living on the streets who would be more than happy to receive any of our hard earned taxes back to help us pay some of our bills, or to treat ourselfs to dinner and a movie once in a while. I think you should think long and hard about doing something to help people who are in those situations by giving them an anual rebate.
RRE3228 In the report it says that Albertans are not receiving their fare share from energy development! What is their fare sgare? Who came up with these numbers? How can it be said that Albertans are not receiving their fare share when you look at the percentages at present. The oil companies are the ones sincking all their money into these projects, not the Albertans. I f the project fails who is out? There is no guarantee that all projects are going to be a success. Also if we raise the royalties to high are we going to loose the interest of companies for proposing and going ahead with other prjects. Where are we going to get a better bang for our buck. If we have 100 projects and the industry is going strong! Or if because of high royalties projects are shut in because of higher operating costs and royalties and now instead we have 25 of the 100 still in operation. This may be a little over board but it will kill some projects and it will definately slow down our industry.
RRE3229 As a [Information Removed]I can attest first had to the implementation of misguided government programs and the damaged caused. This would be the National Energy Program forced on the country and particularly injurious to Alberta and the people of this Province. I can remember one well licence being issued a day! The stage is being set for a similar disaster unless the royalty question is addressed using sound data, information and judgement. I would urge and expect the Government of Alberta to ensure this will happen. To date there has been little evidence of this. The review was clearly biased and inaccurate. In short they just got it wrong! The government has the ability to change this and is under no obligation to accept any or all of the report and even less obligation to be dictated to by the panel members. Much of the dissatisfaction being voiced by the public is a result of poor management by Government in fulling its responsibilities to the people of Alberta. A crippled oil and gas industry will affect all individuals, Alberta and Canada as a whole far more then the majority of people can imagine. Industry is not sending threats but the basic facts of business. An election will be coming soon and if the Government does not get this right and is not fair to all sides of the equation, industry included, this will be remembered come time to vote!
RRE3230 I want to Stelmach government to implement the changes recommended in this report. Those resources belong to the people of Alberta, NOT the oil companies.
RRE3231 To Whom It May Concern: I am really concerned about the Royalty Review Panel report. I feel the Alberta Government really needs to step back and look at the whole picture and how this will affect the province as a whole. I feel if we impose additional costs to the Oil Producing Companies they will begin to focus there interests and capital spending elsewhere in the world. As an industry right now, we are seeing a 5 year low in rig activity which has already affect many people and their careers. Albertans have lost there jobs right now, which infact lower the amount of total taxes Alberta recieves, the amount of economic spending and the ripple effect from there. It will have an impact on all sizes of companies, and I think will have an immediate effect on service companies. In a whole everybody will loss because no one will have the money to live as we currently are. Please rethink this and look at the impact it will have on everyone, not just in the Oil & Gas business. Thank You, [Information Removed]
RRE3232 I started in the oilfield 30 years ago, which means I worked through the NEP. At that time I was working on drilling rigs and now I am a [Information Removed] near Grande Prairie. I have seen many ups and downs in the industry. My son just became a Jounery Welder and completed his B Pressure ticket. As he is now starting on his own I see the same thing will happen to his job as happened when I started 30 years ago. You just get a little experience and then the government gets involved to reshape things " take back from oil companies what belongs to the people." I now am in a better position than I was 30 years ago. I will not lose my job because of the proposals to do with royalty changes that are proposed. But it will make some large changes for all young people just starting out. I have in the past 2 years hired young employees that have no operating experience. These 4 new employees filled new positions here in the plant and field. We have drilling locations picked that would have created enough work to hire at least 2 more new employees. These wells are dropped for at least this years as the uncertainty of the royalty levels goes undecided. These new wells would have created many hours of work this coming year and added to the tax base of this province, now they will not create any form of tax or royalty for the coming years. I have tried to follow all the discusion and think through the information supplied by both sides. The gas industry is presently in a downturn because of high operating costs and low prices. But this impact will be short lived as gas volumes deplete. The industry will again drill to backfill this as prices increase, and government revenues will continue from the many streams that is available to government form a sustainable industry. I seen a industry leader standup and say if they imposed a 20% surcharge on present royalties the industry would go on with only small impacts. This is the type of a solution that would be good for all as the system presently in place has put rates that appear to be good for the industry by spreading drilling over the entire province not just in local areas or targeting individual products say heavey oil vs gas or deep gas vs shallow gas and such. I believe we need a decision soon but also we need one that will give us a continued level of activity. Imposing the panel recomendations unilaterally will shutdown our industry will not do anyone in Alberta any good. Government revenues will drop everyday from the first day forward and ongoing into the future. Please consider the downturn before implementing big changes and only looking short term.
RRE3233 Industry and people of Alberta have spoken and the expert panel have presented their report. My observations and views are as follows: The time guidelines for presentations to the panel were skewed in favour of industry spokepersons. e.g. 10 mins. were given to industry people and only 5 mins. were offered to the public. The report conclusions were reasonable and mostly responsible, however, in my opinion, fall short in a few instances. For example, post payout royalty should be set at least 50%, but most importantly, there should be no P/O of cost recovery and royalty should be a minimum of at least 35% of gross sales.Even at these rates, our Alberta recovery on royalties due its citizens would still be considerably less than other jurisdictions, e.g. Norway, Alaska, Texas. The Government should completely disregard industry threats to pull out and not be intimidated and bullied. Also, there should be no grandfathering provisions when the review recommendations are implemented but should come in effect at the same date that the report was presented to the Government. Billions of dollars have been lost long enough. The time to take immediate action is now. [Information Removed]
RRE3234 Hi Guys I live Lacombe I hope you do not deminish the Alberta advantage that has carried us this far. The lower royalty rate allows oil and gas companies to have a differential advantage working in Alberta, my understanding is this is what holds SK back. Please don't get greedy, we have a huge budget surplus every year and from my perspective the only short fall in our province are the crappy roads. [Information Removed]
RRE3235 Have a Provincial vote, allow the Albertans whom voted you into legislature to be the ones who vote on the Province's (their own) future. I feel that important decisions such as this should be given to the people of this Province to vote on. The Alberta Government is going to make it unfeasable for the Oil Companies to continue their future expansion plans in Northern Alberta. You cannot take 20% of nothing, if Companies halt their future expansion plans due to increased royalties ----the damage will increase Oil prices, increase unemployment, increase Government spending (UI, welfare, etc...). Make the Oil Companies increse their spending on surrounding infrastructure demands, aid with such things as Policing, Hospitals, Social aid. Give the Oil Companies tax breaks on any assistance they provide with infrastructure, Hospitals, Policing, etc... I work in the Fort McMurray Oil Boom. I plead with the Alberta Government not to ruin the future of Albertans. Thanks [Information Removed]
RRE3236 As a younger Albertian working in the oil and gas industry I am strongly against the proposed changes. I was born in 1981 and have memories of hearing about the big crash in our economy due, in part, to the National Energy Program. Alberta's success has been in the oil and gas industry, and I have always said I am proud to be an Albertian. I am very worried about what the effects of the proposed changes will be to Alberta. I am hoping you keep things the same, Alberta is (in my opinion) the best province to live in, I think making changes to it would hurt it, rather than help it.
RRE3237 As a small employer offering production testing services in Alberta, the Royalty Review has already effected us directly. Oil companies that we generally work with are already on the move State side and many others are seizing operations until the final outcome. If Alberta, loses its oil business due to such a "greedy" attitude taken by the Alberta Government - we will have no choice but to lay off our employees and shut our doors as well. Under the Klein government - royalties were up to par - enough so that Albertans each collected a $400 in ralph bucks! So what has changed??? "If it aint' broke, don't fix it!"
RRE3238 I hope you dont go through with the royalties in alberta cause you will loose my vote and many others if you do our livelyhoods really on the oil and gas industry, and so does every other albertan
RRE3239 Good Day. I have been employed in the Oil and Gas Industry for more than 20 years. I enjoy a high standard of living in Alberta but I have breadth of knowledge enough to easily see that the wealth generated by the Energy business in Alberta is certainly not kept in the pockets of Energy Companies and their employees. I lived and worked in field operations in my early career and witnessed first hand the benefits that spread through these entire communities due to the energy business. Living in Calgary today, it is easy to see how the economic boom is benefiting many, many other industries and businesses. If the Royalty review recomendations are implemented, Alberta will certain become much more 'Disadvantaged' than it is today. If Energy companies decrease their investment in Alberta, in will result in less economic wealth for everyone; less jobs, less overall royalty take for the government and absolutely less flow of wealth throughout Alberta. Please consider the opinions of all those who challenge the Royalty Review. Most people agree that there are ways to implement royalty reform while working with the interests of "ALL" Albertans. Smart people live in Alberta, we know how lucky we are to be here and we very much need to hold on to what Alberta is today. [Information Removed]Calgary
RRE3240 what the HeWhockey sticks
RRE3241 The formulas on page 73 can be interpreted several ways. Is there a spreadsheet or graphical output showing the proposed royalty calculated at various price and production levels for conventinal oil & gas. Thx
RRE3242 until i head of the conservatives new plan to increase royaties i vocally painted them as demons who had ruined my beautiful home. however, if royalties are increased- by a significant amount, gigantic amounts- i humbly promise to vote blue in the next election. i cannot stress how vitally important it is for us as a province to not let ourselves be financially raped by oil companies. WE HAVE THE OIL! If they want it they have to pay and pay and pay and pay and pay.
RRE3243 The Royalty Review is not perfect, but is a step in the right direction, to ensure that Albertans are getting their fair share from the Province's natural resources. This report is overdue by several years, and must make us ask the question "what was the government doing this entire time?". The oil-sands royalty breaks were clearly a giveaway, encouraging massive investment that simultaneously caused great strain for social infrastructure as well as the environment. The oil-sands royalty holiday was designed at a time of much lower oil prices, thus needed to be reviewed. Perhaps more excess-profits taxes at times of higher oil prices, need to be implemented, as well as a higher base royalty during the project payout period, to ensure that the government is still getting some revenue. The government also needed to control the number of projects that were constructed at the same time: 1 project per year, for 10 years, is better than 10 projects in 1 year. The result was every company trying to construct a plant at the same time, and thus competing for scarce materials and labour, and driving capital costs way up. This also hurt the government, by increasing the required payout period, to pay for the overexpenditures (this was pointed out by Peter Lougheed) The Royalty Review could still use some fine-tuning. I think some sort of royalty holiday is needed for certain drilling, to ensure that a well can get some degree of payout, before it must pay higher royalties. Royalty holidays do stimulate drilling, which is vital to the overall economy. One major area where the report is lacking, is the fact that it doesn't even bother to discuss the royalty regime in Saskatchewan, which is right next to Alberta. There is no need to compare Alberta to every country around the world, when good examples exist next door. Saskatchewan has definitely benefited from royalty holidays which have stimulated drilling and other activity, especially of horizontal wells, but it does generally maintain higher royalties on normal wells. Where Saskatchewan doesn't benefit as much, is from the corporate taxes that oil companies pay, because many companies are located in Calgary. And it appears that Alberta does not benefit as much from that either, because the province reduced corporate taxes several years ago. So another option could be to raise royalties slightly, and also slightly increase the corporate tax rate. But that would also generate some public outcry. Clearly additional funding is needed to ensure a decent quality of life, especially in the over-crowded cities. However, the government has shown minimal ability to use funds for well planned purposes. When a previous surplus was encountered, the best the government could do was give everybody $400. Why weren't attempts made to try and direct the funds to a faster expansion of Calgary's LRT, or perhaps start building a new hospital? The government must start governing, which means to prepare some longer term plans for the cities, and not just give rebate cheques to people. What ever the final outcome is, the government must carefully balance the need for additional spending in Alberta, along with continuing stimulus of the economy, as well as ensure that grossly excess profits are not being made in the oil patch, at the times when oil and gas prices are very high. When commodity prices are lower, there must be some break, including royalty holidays for drilling new wells.
RRE3244 I am a free holder of mineral rights left to our family by my father. I object to a 100% (one hundred percent) increase in taxes. Is the government considering the Freeholders in their decision making? [Information Removed]
RRE3245 if this bill goes thru not just the common oilfeild worker will suffer it will be the start to bringing down the whole economy that alberta has to offer. i say NO
RRE3246 I would like to address my concerns for your apparent disregard for the people of Alberta. I have been a conservative supporter for many years, but if this government continues to play with Albertans lives like i see them doing, i will have to make an adjustment to my thinking. The royalty issue should not even be an issue...peoples lives depend on the oil and gas industry. By even considering this review, you, the government are causing great distrust in the people, and in the industry as a whole. My biggest concern is the economy of Alberta and the impact that this will have on it. I for one, have worked in the oilfield all my life, and i have never seen the oil and gas industry in such a termoil and taking very harsh stances on this issue. As well, i am afraid of the impact the money that has been taken out of Alberta alone already will impact the economy. This reflects on all workers, oilfield, grocery stores, sales of cars, trucks, housing, whatever Alberta's economy is based on, and relalisticly, lets face it, oil and gas are the mainstay of our economy, quit messing with it. Do Albertans honestly need more money, we are already the wealthiest province in Canada, what is the matter with you people, lets keep it that way, vote no to the royalty review report, leave things alone, and let Alberta prosper as it has in the past. [Information Removed]
RRE3247 I have spoken to many, many clients about this, all of whom are Albertans. All agree that the current economic benefits of the energy industry reward this province enormously. We already get more than our "fair share". Please leave well enough alone. Thank you.
RRE3248 Please take your time,. many jobs depend on you action's. I work in the oil field, just think we should leave thinks the way they are. Thanks [Information Removed] Grande Prairie
RRE3249 Here is a good analogy for the Stelmachistan government to consider while mulling over their “fair share” conundrum. I think this explains the opinion polls (75% in favor of the Royalty increase) to a tee. Of course, the panel doesn’t even consider the possibility that the “size of the pie” might get smaller rather than simply taking a bigger piece of a pie that stays the same size……. [Information Removed] Since it is tax season let's put tax cuts in terms everyone can understand. Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing. The fifth would pay $1. The sixth would pay $3. The seventh would pay $7. The eighth would pay $12. The ninth would pay $18. The tenth man (the richest) would pay $59. So, that's what they decided to do. The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. "Since you are all such good customers," he said, "I'm going to reduce the cost of your daily beer by $20."Drinks for the ten now cost just $80. The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men - the paying customers? How could they divide the $20 windfall so that everyone would get his 'fair share?' They realized that $20 divided by six is $3.33. But if they subtracted that from everybody's share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man's bill by roughly the same amount, and he proceeded to work out the amounts each should pay. And so: The fifth man, like the first four, now paid nothing (100% savings). The sixth now paid $2 instead of $3 (33%savings). The seventh now pay $5 instead of $7 (28%savings). The eighth now paid $9 instead of $12 (25% savings). The ninth now paid $14 instead of $18 (22% savings). The tenth now paid $49 instead of $59 (16% savings). Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings. "I only got a dollar out of the $20,"declared the sixth man. He pointed to the tenth man," but he got $10!" "Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too. It's unfair that he got ten times more than I!" "That's true!!" shouted the seventh man. "Why should he get $10 back when I got only two? The wealthy get all the breaks!" "Wait a minute," yelled the first four men in unison. "We didn't get anything at all. The system exploits the poor!" The nine men surrounded the tenth and beat him up. The next night the tenth man didn't show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn't have enough money between all of them for even half of the bill! And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier. [Information Removed] For those who understand, no explanation is needed. For those who do not understand, no explanation is possible.
RRE3250 I am writing with regard to the oil and gas industry’s well published anguish over possible royalty increases. First off I am one of the industry players. I have spent the last 37 years in the industry as an explorationist, a manager and a consultant to both oil companies and government. I have worked on oil and gas projects from Drake Point to Iraq. I have overseen capital budgets of in excess of $80,000,000. So I am not without knowledge and experience of the issue. Furthermore I have personally benefited from all the money floating around. Having said this I can assure you the industry would cry foul, feign potential bankruptcy and publicly assure everyone of their impending doom if you increased the current royalties by .1% In reality the only thing that will cause a major change in industry plans is a major change in price. As long as they can make a 10% profit (not the 15% they so commonly use publicly) they will learn to live with whatever government regs thrown their way. If they can’t make 10% they will start cutting costs which usually means delaying exploration, note; not exploitation. Ever significant change in Canadian oil and gas exploration and production planning in the 37 years of my participation has been triggered by sudden major price changes such as that seen in 1986. If the truth was freely admitted you would find that even during the “horrific” years of the NEP industry insiders still did pretty well. I personally signed expense accounts for 5 people who were sent down to Houston to watch NASA launch a satellite in 1981! Today I have friends whose stock options will currently net them over 1 million dollars. I have friends who bitterly complain that their daughters show jumping aspirations are costing them $1,500 a month. I have friends who blithely went out and bought a new pickup truck and 2 ATV just because they got bored last time they visited their recreation property. None of these gentlemen are managers or executives. My friends at the executive level are really spending money. One bought a vacation property in the Okanagan for over $1,000,000 last year. To date he has spent a whole week out there. Another recently retired at age 39 after he was essentially forced out of his position as president and CEO of a service company. In short they have more money then they can spend intelligently and if all the royalties discussed were initiated they would only be reduced to being well off rather then ridiculously well off. Given how much the less affluent in Alberta have suffered because of rampant inflation and the out of control expansion I see no reason the industry shouldn’t be forced to slow down and think once again. I also see no reason the government can’t start rebuilding the Heritage Fund and helping Alberta’s poor while it is still possible.
RRE3251 I work on oil drilling rigs and I have been a driller for a little over a year. I wish the oil companies would do their part an pay up on royalties (which I believe should be put up over so many years,not a one lump sum). Oil companies have the largest gains ever and are crying about paying what is rightfully our national resources. Seems to me if they cant have it all that they have the power to shut down the oil industry and take away our jobs. Im tired of hearing at work how expensive it is to drill for oil and turn around and see the billions of dollars that they pocket and millions of dollars they hand out for bonus's to their workers. I believe we need to get the royalties which they were given a break on in the first place and put it back into our province for our people and for our children to keep a good life in which we have. Our jobs may be in danger from this but our future is what we hold in our hands. I hope and pray we make the right decision in this for the entire province will feel the out come whether it is GOOD or BAD.
RRE3252 I don't know how you can consider your Royalty Report "Fair Share". I own freehold mineral rights that were earned by my ancestors. You have no right to double the freehold mineral tax. I also work in the oil and gas industry and know what devastating results will happen because of your greed. Hopefully your government will be short-lived.
RRE3253 My company, being one of thousands of small business driven directly by the oilfield, is very concerned about this review. The year long slow period that we have already experienced has hit a lot of companies hard. If the oil and gas industry is to be hit any harder, it will surely be the demise of many companies, and will destroy Alberta's economy as we know it. People that have voiced their opinion, saying that the oil and gas companies should be hit harder obviously have no concept of what they are doing to themselves. I can't believe that they do not see what it will do to their jobs as well. Imagine what a hit like this will do to thriving hotels , restaurants, shopping malls, lumber yards and the housing markets. A raise in the royalty tax is supposedly going to net Albertans greater rewards. However, do they not stand to lose more when thousands of jobs are lost, businesses shut down, and what about the large tax base that all these companies provide now?
RRE3254 Government must raise royalty rates to the full extent listed in the Royalty review - not a percent less. The province needs a take more in line with other jurisdiction. They situation over the past 5 years has been deplorable - obscene in fact. Dunn's report simply confirms the Royalty Review. Albertan's have been [Expletive]. The boom engenedered by the unstructured development of the oilsands resulted in massive inflation and overloading of provincial infrastructure. The extra take will help pay for the infrastructure needs which are huge. This should never have happened but now the government has some chance to begin caring for neglected needs. The two reports will be fuel for change and if the PC's don't use it the opposition parties surely will!
RRE3255 I am very sure you have had an enormous amount of feedback about the release of the Royalty Review Panel’s document. I write to you not only as an Albertan, but also as a member of the economy sustained by oil & gas development. I was fortunate enough to have had the opportunity to evaluate the potential impact of the recommendations on our company, and have read and re-read the Panel’s recommendations. I sincerely hope the Government of Alberta is going to properly research these recommendations thoroughly before taking any action that may ‘kill the goose that laid the golden egg’ – as one might say. It concerns me that energy companies like Canadian Natural Resources, one of the largest producers in Alberta, reports only having had the ear of the panel for a mere 10 minutes. The report contains not only dated information used for calculations, but also takes no consideration for the manner in which this industry operates. It also discounts a fundamental notion that higher taxes discourage spending. Obviously many energy companies and analyst firms have provided a plethora of information that challenges the integrity of the Panel’s recommendations. I hope that in the best interest of all Albertans today and in future, our Government will act in a responsible and consultative manner before implementing changes that could forever damage our Canadian and global competitiveness. I implore you and our Governement to not rush an important policy decision. Do not implement a policy that is predicated on inaccurate information and assumptions, has not been proper consultation and is not in the best interest of Albertans. We should all share in the resource that belongs to us – yet in a manner that will sustain and encourage current and future growth in this sector. Sincerely, [Information Removed]
RRE3256 As a shareholder in an Alberta based Commercial Real Estate firm [Information Removed]I am seriously concerned about the prospects contained in the Royalty Review. Our success is directly aligned with the national and international perception of Alberta as an Investment alternative. Alberta is in great shape and " rocking the boat" would not make good business sense. I am sure we all know the term " if it's not broken, don't fix it". If the Alberta Government has an agenda to create a socialistic state then come clean and say so. Basic economic and financial fundamentals clearly illustrate that this would severely reduce not increase the surlpus for all Albertans to share and benefit from. There is more than enough facts and reports being put forward by REAL intelligent qualified people and organizations that should make the Government wake up. This would be a slap in the face and make doing business in Alberta much more difficult. Yours truly, [Information Removed]
RRE3257 I think it is a bad idea to increase the royalties when costs are already skyrocketing and margins are being squeezed. I am an investor from the US and would probably transfer my oil investments to companies working the UK, Norway, Peru and Columbia.
RRE3258 I hope that this present Premier does not back down from following through with the reports recommendations. For too long, certain aspects of this economy has road rough shot over everyone. Oil companies should be good corporate citizens and pay their dues. The rest of us have to, so why shouldn't they! [Information Removed]
RRE3259 Don't change the rule when it is good.
RRE3260 Given the unquestionable anti-public policies of the AB Tories - a policy that formed after Lougheed - there is no hope that Stelmach will change the current royalty regimen. The public have been consistently disenfranchised from policy in favour of significant profit-taking by international oil giants. As a friend who recently moved to AB said "I can't tell the difference between government and industry in this province." Until we "clean house" like was done federally, the anti-public corruption will continue.
RRE3261 I along with many professionals have great concern over the outcome of the royalty review. Alberta has attracted many skilled professionals with the lure of a better lifestyle. The oil and gas companies have certainly made it clear that investment will be considerably lower than currently planned. In fact many of them have put a hold on recruitment wich is always a negetive sign for growth. Given that most business are tied into the Oil and Gas companies in one way or another, the disinvestment will negetively affect everyone. I cannot understand why premier Stelmach has not met with the leaders of these companies to discuss a win-win situation. It seems he is going for glory here and that is not acceptable.
RRE3262 This report aims at nothing but a giant cash grab, which will put potential capital in the hands of a government that is unable to spend it efficiently.
RRE3263 It is time for all Albertans to get their fair share of the oil revenues. The oil companies are looking out for theirselves, they have made record profits in the last few years on our oil. So it is now time for us to get a fair share. Ignore the sabre rattling, as the oil companies have always continued to drill for oil after every raise in royalties. Other countries charge a lot higher rate in royalties than we do. So please don not sell Albertans short, you still have to be re-elected and normal Albertans still hold the majority, not oil companies.
RRE3264 The entire premise that 2 billion dollars could have been collected last is entirely wrong as an increased royalty would have surely negatively affected industry activity with a downturn in drilling acivity and the resultant loss of revenue in the service industry. further there would have been reduced employment and taxes collected. Please don't be so short sited as to to penalize an industry that has been the economic engine of Alberta by changing the rules mid stream.. [Information Removed]
RRE3265 Our economy has been running too hot. We need to slow it down. The business cannot hire qualified people as everyone is employed. House prices have appreciated too fast. A slower economy will bring thing back to normal. House can be affordable again, may be down 20-30%, back to the level of 1.5 years ago. Some people may be laid off from work, but we have a strong employment growth, so they will not be off work for very long. And with inmigration slowing down from other province, it will provide relief on infrastructure. An unemployment rate of less than 1.5% is unhealthy, and 3% is normal. The resource production will be reduced, but they will remain in the ground for future production, for the benefit of future generations. The actual royalty collected by government may be lower or flat with higher royalty rate because production rate will be lower, but higher in the long term as the oil and gas are produced eventually, may be 5, 10 or 20 years in the future. It will be a short term pain, but long term benefit. I support the increase of royalty rate. Russia has tried to regain the oil and gas resources back from companies, Venezuela has cut back on their production as their skill people are leaving the countries to come to Alberta so the government income has actually been reduced even with them owning more of the resource. Alberta will achieve similar results by raising the royalty rates and thereby asking the oil companies to produce less.
RRE3266 As a resident of rural Alberta I am totally stunned at the review and its possible consequences to my family and our strong Alberta way of life. This, along with a par to American dollar will spell disaster to the oil and gas industry, and every spin off business that the oil and gas industry supports. I hope the Alberta Government takes a very close look at the whole picture before deciding. If they make the wrong chioce, the Alberta Advantage will be gone. Maybe at least the Heritage Trust Fund will be used to support the provincial welfare coffers. My vote at the next election will definatly go to ABC (Anybody But Conservative).
RRE3267 I desire, as an Oil sands construction worker, the slow sustainable growth of the industry......as a parent, I want the benefits of Alberta’s natural resources to last for the longest period possible for further generations........As a safety professional, I feel that we have undermined our standards and dedication to the safety of workers by the fast tracking of so many projects and the importing of foreign labour. I believe Albertans should reap the benefits of oil royalties based upon the pro rated length of time residing in the province.………I do not want foreign companies, or their stock holders, regardless of where they are from, to run rough-shod over our provinces’ environment its people or its resources especially in the name of progress better known as the reality of greed. I vote for and support an increase in the royalties in the hope that Alberta development slows to a sustainable pace. And the next time you seek to embarrass us by doling out $300 dollars with a mere pittance of our rightful share and a slap in the face for the folks who have stood stead through the booms and busts and the countless struggles to built this province will be the last time I vote Conservative. So do what right, listen to the panel -- raise the royalties.
RRE3268 As an [Information Removed] employee, and working in Alberta by the BC border, I am quite concerned about the 20% proposed increase. [Information Removed] has made it clear to us that they are willing to work with the government and agree that a change in Royalties is very important. Please be open minded and keep us in "mind". I do not feel [Information Removed] is a "bully". They do have a Budget to follow, like any other company and they will be spending their money elsewhere. Thanks [Information Removed]
RRE3269 I strongly believe that Premier Stelmach should hold fast and stand his ground to ensure that Alberta gets what is rightfully ours. These oil companies that are threatening to pull out have already received more than their fair share and really have no where else to go. Stand firm and call their bluff - in my opinion they do not have a lot of other options - this is where the oil is and if they aren't interested, there are many others just waiting for an opportunity to come in and do business with us. The West and mainly Alberta has been taken advantage of for far too long.
RRE3270 Increasing the tax on the oil and gas industry will prove to slow construction, exploration and production and have a very negative impact on Alberta's economy. Currently the entire nation is depending on Alberta's economic strength. The CAD$ is on par with the American dollar as their economy is slumping and will continue to do so for the next decade. The oil & gas industry is what will keep Canada from joining them. "The mouse living beside the elephant" will continue to live comfortably only if our natural resources continue to be developed sustainably.
RRE3271 In my view; our province is doing perfectly well with what it receives from the oil and gas Industry. Every quarter we have extraordinary surpluses because of the industries contribution. If Royalties are raised there will definately be a further slowdown to the Industry resulting in further layoffs, less profitabilty making the 2 billion a mute point. A perfect storm has hit the Alberta Oil Patch...The trust desision, the increased service costs, the Royalty review debate, the dollar increasing, etc. If the Government adds to this perfect storm it could be a knock out punch. [Information Removed]
RRE3272 I would first like to commend the government and Premier Stelmach, for opening the Report to public dialogue. Although I am not an expert, I find the report very credible and convincing. It confirms a suspicion held for a long time that the Province and the people of Alberta have been extremely genorous to the Petrolium Industry. Jurisdictions all over the world have been charging much more then we have and the industry continues to develop and prosper in those areas. The gross compensation to executives and management and the huge profits being realized by the industry are evidence in themselves of the disprportionate share being realized by the owners of the Resource. I wish you well in your deliberations on our behalf. [Information Removed]column in the Herald, Sep't. 29, sums up most of my thoughts. Your challenge is great and the resouces of the industry will undouptedly put a great deal of pressure on you. Please support the conclusions of your Committee and give us a "Fair Share" Sincerely; [Information Removed]
RRE3273 As a operator in the oil field I am very close to the royalty review in the case where I know what the costs are for a Oil & Gas company to be productive and the amount of return they make on the product. If this is approved it will change Canada's economy drastically. There will be far too many people on un-employment and welfare due to the shortage of work. Does the government not take into account how the small guys support families on the income that these companies provide. Not to mention the amount of taxes paid to the government from the employed people instead of paying out government money in social assitance, how stupid is that. This is probably the most hair brain idea that our government has come up with thus far!! Bankruptcy, welfare, homelessness, crime, alcoholism and broken families are all going to increase with the unemployment rate the government will create with this project. PLEASE CONSIDER ALL ASPECTS OF CANADA'S FUTURE IS THIS BILL GOES THROUGH. THIS WILL CRIPPLE OUR ECONOMY AND OUR STAND WITH THE REST OF THE WORLD!!!!!!!!!!!!!!!!!!!!PAY ATTENTION, THE MONEY THIS BILL WILL GENERATE WILL BE PAID OUT INTO DEPRESSION.
RRE3274 The review conducted by the panel was incorrectly completed and failed to account for important differences between different geographic locations, the different types of petroleum and the validity of applying royalties to each, among other important factors. The current suggestion to increase royalties is flawed and until a more reasonable and accurate assessment is completed there should be no change in the royalty structure. This is not as simple of an issue as the report and panel suggest.
RRE3275 My wife and I are very average "Martha and Henry" Albertans. We were born and educated in Edmonton and have both been working and paying taxes for over 30 years. We are Grandparents to 9 beautiful children ages 2-15. We initially supported Ralph Klein's "vision" of getting the Province of Alberta out of debt. This support turned into puzzlement when we found out that there was no plan for the unprecedented growth in Alberta. We were hopeful that a change in Leadership would correct some of the glaring errors that have occurred under the Tories watch. Our future voting decisions are going to based on Premier Stelmach's television address and whether or not he heeds the cries of many Albertans who have alarm bells going off in their heads in regards to the integrity of ALL the Tories currently in power. I am proud to be Canadian, but I am ashamed to be an Albertan because this boom has hurt the most vulnerable people in our province - the seniors, children and anyone with a physical or mental disability. The money for needed support programs would have been available had it been collected properly and in line with countries that are similar to Alberta/Canada.
RRE3276 Too much too fast and this will kill our Economy, much of which is based on our Oil/Gas industry. A poor path forward and one that suggests a Socialist philosophy.
RRE3277 I think that royalties to government and therefore to benefit the common Albertan should be higher. 20%?? well maybe not, but for people like me who are not involved in oil and gas industry it would be better that the ecomony cools a little and costs of housing, services etc.are more reasonable. Please consider the recommendations carefully and do not be swayed by the lobbying of the fat cats in oil and gas.
RRE3278 Have you checked the price of gas lately??? Have you researched how many small oil and gas companies that employee many Albertans would be negatively impacted by the proposed changes? We just lost ARTC and now you're asking us to take another hit.? Albertan's receive their "fair share" of royalties - without taking any risk that oil and gas companies take. Year after year, the oil and gas sector has allowed the Alberta Government to "appear" to be doing a great job managing their financing by provided a large windfall in royalties. Last year the federal government blind sided our industry with the Trust ruling -- you're doing the same in a much worse pricing environment. Fair share for whom? Sounds like greed - plain and simple.
RRE3279 In 1996 I moved from BC to Alberta, this move was in a large part, due to BC Governmental policies towards business. In BC, businesses were penalized for being prosperous, business in BC was drying up, job opportunities were disappearing, people who were interested in working were moving away. When I was offered an opportunity in Alberta, I had been holding 6 part time positions, for 2 years, trying to make ends meet. In the last 10 years I have been very impressed with the work ethic and attitude of individuals here. I’ve observed one reason for the difference, was again largely due to the AB Government’s policies towards business. In Alberta, business has been encouraged to grow, innovate, improve, take risks, etc. this positive corporate attitude can’t help but be passed along to its employees. I am not swayed by “popular opinion” polls, they are just a product of the media. I find the media is often wrong and always over sensationalized with their interpretation of the facts they have been given. I am swayed however by the fact that, due to the "Royalty Review" proposal, the company I work for, has 2 different budgets for the upcoming year, one which includes me and one which probably does not. I really do not want to leave Alberta, I love living here… And I hear job opportunities are increasing in Saskatchewan and property is cheap in Newfoundland… Thank you, in advance, for considering the facts in your decisions with my life. Sincerely, [Information Removed]
RRE3280 Two recent articles, published in the Edmonton Journal, "Energy Royalties: responding to the critics" by Gary Lamphier, Oct. 20, and "Review panel actually plans sharp drop in royalties" by Gordon Laxer, Oc. 22, have strengthened my opinion that Alberta, the owner of a magnificent resource, is being seriously shortchanged. Surely we have the intelligence and the courage to stand up for ourselves!! I have noted that the oil companies have been complaining that the Royalty Panel have used incorrect data but I have yet to read point by point rebuttals, complete with facts and figures, to support these claims. Who is stretching the truth? [Information Removed]
RRE3281 Ralph Klien built this province up,Ed Stelmach is tearing it down!
RRE3282 Premier Stelmach, We stand behind your decission to to increase the royalties on resources that belong to all people of this province. Please follow the example of wisdom and courage of the 1972 rookie Conservative government of Peter Lougheed. [Information Removed]
RRE3283 This Royalty Report scares me as a citizen of Alberta, I have been losing sleep wondering if my life will be able to continue as it is, where we will find jobs if the oilfield sector falls apart and when a decision will be made. We need these jobs worse than we need the Royalty money, increasing this will only benefit another Province as they will inherit our boom. This is a major situation and we need the leadership to help our economy not hinder it.
RRE3284 I would like to express my concern on on raising royalty rates by 20 per cent. It is too high and such increase would definitely hurt the province's investment and growth potential. Albertan gets our share of profit indirectly - such as by economic growth, public and private investments, jobs are created, population increases, infrastructure are built. These are positive economic factors added to Alberta not in a dollar term directly. I strongly oppose such high rate recommendation. The rate increase should be less than 10 percent.
RRE3285 How in a business venture can two parties enter into an agreement and then one party arbitrarily decide to increase their percentage of the deal while the operation is in process? In a free society this cannot happen and the courts are called upon to settle the disputes. What if one party has the ability to introduce legislation that directs the actions of the courts, then simply the society is not free! In the seventies we saw the rise of a government movement and the introduction legislation that while trying to curb inflation and secure the future of Canadian oil production there was an attempt to nationalize the Canadian Oil industry with the introduction of Trudeauian socialism (wage and price controls and the National Energy Policy). This government action had disastrous results for the Canadian economy for 30 years (60 cent dollar and high unemployment figures) and devastated Alberta for more then a decade. The emergence from this period has been led by a charge of entrepreneurial spirit of Albertans working with the provincial government to build an industry that is the envy of the world (parity with the US dollar and international recognition). The ability of the average working person to prosper and share in the wealth generated by our natural resources is the results of these decades of work and risk taken by the business people and workers in Alberta. How can a Government believe that it has the only voice in the social conscience of the people? Doesn’t the current crisis in Alberta around the labour shortage and current world record salary curves for all Albertans indicate how all Albertans are benefiting from our growth? Does the Alberta government not receive income taxes from all Albertans? If a government collects a bidding bonus for the lease of their mineral rights why should they be also entitled to up to a 50% royalty (off the top, non-risked), and then tax the profit of the corporation and also collect income tax from the employees (and don’t forget to add the Federal government tax on all levels also)? Ask yourself this, what truly is a fair share of revenue without risking capital and how many places are Governments trying to extract taxes from the people to operate. With record high government surpluses already, how can you radically revamp a system that is functioning this well and when does Government’s greed condemn the people of Alberta to a return to the struggles of the 1980’s? Mr Stelmach, it is completely absurd not to grandfather all existing production and leases that the Alberta Government has received bids on as all economic models have been run on the existing royalty and tax structure (I personally believe that it would results in litigation against the Alberta Government as business could never operate this way without contractual certainty and personal integrity). Mr Stelmach, you are also setting the stage for a major dispute with the Federal Government over tax revenues and transfer payments which will wind up being punitive to the people of Alberta as taxes will be increased across the board to compensate for your greed! Mr Stelmach, if you take the same type of action against the lumber industry you could personally end the softwood lumber dispute by imposing a royalty on each tree that is harvested and calling it a “stumpage fee” even though the government has an agreement with the lumber industry to allow harvesting without royalties (but government agreements seem to be able to be changed at a whim so if you change the oil royalties here don’t stop there and add a softwood stumpage fee and end the softwood dispute). Mr Stelmach, government must function with a social mind and business acumen to be fiscally responsible to all it’s people, do not let greed from either side of this issue be the deciding factor. The world is on the edge of a global recession which is being triggered by the sub prime mortgage issue and poor legislation in the US regarding debt and financial instruments being sold to investors as something they are not. Governments need to protect their citizens and use their laws to ensure all people are protected from deceit and fraud and that infrastructure and social services are available to all the peoples of the land. Canada has achieved this balance between free enterprise and social program availability and Alberta has stood out in the country as the leader. Don’t radically change a system in a negatively changing world. You must adapt and introduce changes slowly and progressively into future projects as governments should never shock a system and introduce changes that are retroactive as this is clearly the actions of a third world nation and not a world leading nation such as Canada! I submit this perspective as a concerned citizen of Alberta and as a businessman with a passion for his family, his work and his country. Sincerely, [Information Removed]
RRE3286 Please don't push too hard on royalty issue, it will result in less investment and huge job reduction in oil sector. Government of Alberta will be responsible for that.
RRE3287 I have a number of comments on the ARR and the manner in which the ARR has been handled however I do not believe there is sufficient space for me to go into the detail that they deserve. I will say firstly that I am in the oil and gas business and have made a good living for myself, my family and many others. I have started three oil and gas companies over my working career and have employed as many as 50 people directly in an exploration and production company and over 100 people directly in an oilfield service company. These have all been well paying jobs that have resulted in expenditures within the Province and taxes paid in Alberta, both corporate and individual. I read the ARR shortly after it was released and could not believe the inaccuracies and grand statements made by a so called "blue ribbon panel". Anyone with any knowledge of the business would know how the industry works and the cost of doing business in this sector. Unfortunately, when the panel was struck, no one objected to its composition which was obviously a huge error by industry and for the people of Alberta. I also took offense to the manner in which the ARR was presented as if a group of individuals using a few consultants should determine the future direction of the oil and gas industry in Alberta. With respect to the report itself, anyone that follows the sector would know that their cost assumptions were way off base, their assumptions with respect to making significant changes to the fiscal environment and generating an additional $2 billion in revenue, their convenient omission of the land sale revenue as being part of government "take", and the naivete associated with making a statement that there should be no grandfathering and likely no impact on the business prospectively. I am a native Albertan who was raised on a farm in southern Alberta, graduated from the University of Calgary and have worked in the oil and gas sector all of my working career. This basin has changed with time and it is a high cost basin. The size of the reserves is smaller and the production volumes are lower. It is primarily a natural gas basin and with the cost structure experienced in the sector over the last few years, many projects are not economic at current natural gas prices. The panel states that 82% of wells would pay lower royalties. The comment they fail to add is that at what price. All wells pay higher royalties at $7.00 per mcf which, being an optimist, I hope prices return to. The "omission" of the keeping the marginal deep well royalty holiday was ridiculous and reflects on how much time and effort went into the report by the "blue ribbon" panel. As stated earlier, I have been involved directly in the oil and gas industry since 1972 and have experienced a number of cycles. Unfortunately too many of them have been created by politicians trying to squeeze an extra dollar out of business rather than letting business create jobs and grow the private sector. Politicians should be focussed on creating an attractive business environment for the private sector and terms that are equitable to the resource holders and the resource developers. The recommendations made by the "blue ribbon" panel are not fair nor equitable. Industry takes all of the financial risk in exploring for, developing and producing oil and gas in this Province. The Government does not share in that risk, in fact, the Government receives risk free funds in the form of land sale revenue which has totalled in excess of $8.5 Billion over the last five years. The Province benefits from the funds invested in the sector and the jobs created by the sector and the money the sector attracts to the Province. Political initiatives like this one slow industry to a standstill and it will take years to achieve the level of activity we have had in the Province recently if the ARR recommendations are approved. Look at history in this Province and you will see what I mean. The fact the panel believes it can generate additional $2 Billion in revenue for the Province is nonsense as business will grind to a halt if its recommendations are implemented. I sit on the boards of two oilfield service companies and I am a principal in a third oilfield service company that is private and we have started laying off people in droves because of lack of work. This will only be exacerbated by the recommendations made in the ARR if implemented. In fact, it may be too late for many oilfield service companies already as rigs are not being booked for winter and industry is delaying or slowing activity because of the uncertain fiscal regime. I also find the polling results to be extremely interesting. If you ask anyone if they want more money or less taxes, they will say yes. If you ask them if they want to risk losing their car, their house or not being able to find good paying jobs, they will say no. The implications of implementing the recommendations contained in the ARR are many and run deep in this Province. People really do not understand the spinoffs from the oil and gas sector and we need only look at the Edmonton-Calgary corridor, the price of real estate in this Province, the number of new cars sitting in peoples' yards and driveways and the number of new trucks in farmers' fields. They also forget that the money going to support beef producers and agriculture in this Province comes from somewhere. I always have this great conversation with a good friend of mine in the ranching and cattle feeding business about the fact that he pays little or no tax and that I should simply write him a check every year because of the flow of capital from the oil and gas directly and indirectly to the agricultural sector. This may be somewhat rambling but all I can say it that I hope reason prevails and the elected politicians do what is right for the people of this Province rather than what might be politically expedient in the short term but have long term negative implications. Regards, [Information Removed]
RRE3288 I find it extremely disappointing that the Alberta Government failed to balance membership on the committee. Including a few industry people would have added a great amount of knowledge and perspective. Regardless of the credentials of the members, without industry experience, their qualifications are suspect. The report reads more like a Communist Manifesto than a document that should be objectively evaluating the fairness of the current regime. It is now common knowledge that Alberta does receive its fair share relative to other jurisdictions around the world. When you take into account the fact that Alberta has a finding and development cost per barrel of oil equivalent , as our target reservoirs are becoming very small, we need to be very careful not to kill the goose that laid the golden egg. I believe that this initiative could be as bad for the province as was the NEP. Please remember that capital flows to wherever the attractive returns on investment reside. Premier Stelmach will leave quite the legacy if he is responsible for a major economic downturn in this province.
RRE3289 some increases in the royality structure is required
RRE3290 I am concerned that what you are considering will be a material adverse change for the Alberta economy. I am an investor with numerous hotel properties in the province and my business depends on the oil & gas industry. Obviously, if I am not making occupancy levels beyond my costs and financing commitments I am not reinvesting a great deal in this province. The review panel's response is ridiculous and uneducated. It makes as much sense as declaring Albertans deserve their "Fair Share" of all the farms operating in Alberta; as this Alberta soil is property of Alberta's citizens. Furthermore, declaring that all large farms will be taxed disproportionately to smaller farms. Mr. Stelmach if you ruin our economy to acquire short term votes you may have your win but your legacy will not be easily forgotten.
RRE3291 I feel Alberta should recieve as much in royalties as other countries do, (such as Norway). Oil is not renewable and Alberta has done nothing sustainable to ensure the future of Albertans. We are doing well now but what happens when we no longer have oil to rely on? Other countries have thought of their future and have used this money for trust funds and to sustain social programs for years to come. Albertans should have excellent education, healthcare, childcare, and social supports. We have the resources now, lets take advantage of them for the future.
RRE3292 The Royalty Review will be devastating to all sectors in Alberta. The Premier should not accept the panel's suggestions. We are already facing a slow down and as a company that relies on the oil and gas industry the Royalty Review is keeping me awake at night. Why try to change something that is working. What most people don't realize is that businesses take the risk to make money and it is only greed that is wanting to take that money away from those that do the work. I don't see people offering to help when companies are losing money and then lose their businesses. Wake up Alberta - we are a strong, viable province - why mess with that. Jobs will be lost, businesses will struggle, some will need to close their doors. Everyone in the end will be effected. Premier Ed Stelmach - please say no to this crazy idea. It is vital to maintain Alberta's richness and viability.
RRE3293 I think that a royalty increase is long overdue. The recent review recommendations should be the bare minimum for the royalty increase. Do not let the corporate world dictate policies. The oil companies are chronic whiners. [Information Removed] Edmonton
RRE3294 I think we are being short-changed on our royalties for a long time. Why are we still allowing so many Americans to work on projects here in Alberta? How many Canadians are given work visas to work in the US? I don't think it is very high. We cannot find managers across Canada like Ontario and Quebec to come and work here. The Americans make their money here and then spend their salaries back at home. We are becoming more and more like a banana republic and not finishing the final oil product here in Canada. Why are we building pipelines to the US which will take jobs away from our economy in Alberta and shrink our economic benefits for the rest of Canada.
RRE3295 I understand that right now our Preimier Mr. Stelmach is not taking any calls from anyone outside his people on this topic. Why? He is not communicating or listening to the people who elected him. The proposed royalty structure if implemented will cripple the economy of our fine province. He must listen to the people right now, and at the very least take more time and relook at what his panel of a paltry five people have recommended. Stelmach should be man enough to admit he is wrong, despite his having said he "would not let oil companies push him around". If it is "saving face" now for Stelmach he better consider the likley scenario of him being remembered for causing the worst economic disaster in Alberta since the NEP. I dare say he does not want that.
RRE3296 I feel that the increased royalties and taxes will greatly restrict oil & gas development in Alberta and be very harmful to our economy. Let's not not get greedy and ruin a good thing!
RRE3297 Hello Thousand of people in Alberta depend of Oil & Gas Industry. Oil & Gas Industry in Alberta generate thousand of direct jobs and indirect jobs , those jobs generate tax and benefict for all albertians, withouts Oil Idustries in AB, the goverment not recive taxes. Be smart, more wells more taxes, les wells less taxes. I proud to be Albertian!!.
RRE3298 I believe the amount of share for the developer and the people of the porvince should be equal, 64/36 is not fare. There are alot of Albertans, myself included, who are emploied because of the development in the oil sands. Many of us are also share holders as well, and changes in the royalties hurts us all.
RRE3299 Thanks you for this opportunity to strongly urge this government to implement all of the recommendations put forth by the Royalty Review Panel. They are long overdue. The oil industry has been ridiculously cosseted and overprotected from paying Albertans a fair share of the immense profits that arise in taking resourcesfrom the ground that belong to all Albertans; not to the oil and gas companies. Had the royalties been collected when they should have been, perhaps some of the dire problems facing so many of our citizens - homelessness and the impoverishment of the working poor spring instantly to mind - could have been addressed and solved. Other areas also badly in need of government funding, environmental protection, healthcare and education could all have benefitted also. Please begin to redress this imbalance by finally acting on behalf of the people instead of in the interests of the oil industry.
RRE3300 I work for a Multi-National Oil Company and am intimately involved in the planning, budgeting and expenditure process on a project by project basis. I am involved in Land Sales and various strategies in the exploration process. Should the Royalty Review recommendations go ahead in part or as a whole( in particular the Alberta Deep Gas Royalty program or the Oilsands Severance Tax), our investment in Alberta will be deeply cut or eliminated, depending on what is adopted from the Report. With a 2008 budget of two billion dollars for investment in Alberta at stake this is an issue we are obviously looking at very seriously. Natural gas drilling is currently at a five year low with 62 - 63 rigs currently drilling. Gas prices are depressed and the Canadian dollar is at the highest point it has been at in 33 years. The recommendations from the Royalty Review panel are flawed because the numbers being used were from 2005 and are not today's reality. I would recommend that you do what is right for the Province - and that is to not adopt any of the panel's recommendations.
RRE3301 I understand that Alberta has a very robust economy and some people think it needs to be slowed down. But has anyone stopped to look and think that it has already started to slow down? Why doesn't someone ask all of the people already laid off from service crews and drilling rigs, or that have had to move with their crews to USA? Do you think they want more job loss, it will hit service companies fast and hard. And who fills all the hotel rooms, and goes out for meals, and buys the gas in all the small towns in Alberta. This is scary for the general public, a little honesty in the review would have been nice. The $2b extra that Albertans supposedly deserve is going to disappear fast, and all the public sees if more money, more money. Most of them don't understand any of the under lying issues, and no one has made that clear to them. When anyone speaks out against increased royalties the media calls it strong-arming by industry (along with the premier using those words) The public gets complettely mislead. Could the government and politics interfere anymore?? What happened to a free market economy?
RRE3302 I contract operate for [Information Removed]. Now at 7 years. I remember well the NEP as I was oilfield trucking at the time. I would hate to see the Gov't let that happen again. We almost starved. If Alberta needs more income then renegotiate shares with the federal gov't but don't discourage the oil companies. We need our jobs.
RRE3303 Dear Premier Stelmach, I want the provicial government to fully implement the recomondations in the Royalty Review Report. [Information Removed]
RRE3304 Two words. One name. Danny Williams
RRE3305 I believe that the best approach would be a graduated or phased in approach done over a certain period of time.
RRE3306 I have been a resident of Alberta for my entire life and I completed my post secondary education in 1985. My field of study was mainly geared towards a career in the petroleum sector. Although I am not currently employed by an oil and gas producing or servicing company, my livelihood, like many others in this province, directly depends on the well being of petroleum industry. Looking back at the 1980's, I remember all to well the pain that was inflicted on this industry by the Federal Liberal Party and the NEP, this coupled with a downturn in energy prices made it very difficult for a young person to obtain a job that would provide a decent standard of living. Now fast forward to 2007 and I am very concerned with the prospect of stepping back to those hard economic times. Therefore, I feel compelled to write to you to put forward my thoughts on the recently released royalty review report. The petroleum industry in Alberta has already seen a reduction in drilling due to the downturn in the wholesale price of natural gas, the increasing value of the Canadian dollar and the dramatic increase in costs that the industry has seen in the past few years. Add to this a substantial increase to the Provincial government's royalties on conventional oil, natural gas and oil sands and I fear the economic viability of many projects will not be favorable in Alberta. Therefore, I urge you to proceed carefully with any changes to the current royalty regime which has allowed Alberta to become the most prosperous province in Canada - my job depends on it. Remember, 20% more of nothing is 100% less. sincerely, [Information Removed]
RRE3307 it is more important and beneficial for alberta to keep the people employed and the industry vibrant then it is to worry about the royalty up front. collect the royalty increase after payback. [Information Removed]
RRE3308 Being directly involved in this issue as the General Manager of a Construction Firm, I feel that the way that the big oil producers are wieghing in, we had better take this seriously, or we will kill these properous times. It will defiately affect the way that I will vote in the next provincial Election. Sincerly [Information Removed]
RRE3309 In principal I support increased royalties, but the implementation must be thoroughly considered and involve representation from all business sectors in Alberta. This is a long-term decision, and as an Alberta citizen I expect my government to take the necessary time to consult with all the potentially impacted businesses in Alberta and for everyone involved to agree on a workable solution. The royalty changes should be phased-in, so everyone has time to adjust. Long-term stable growth with known business operational parameters is essential for Alberta’s future. There is no benefit to me as an Alberta citizen if the government receives increased royalty revenue and Alberta citizens start losing their jobs and house prices collapse. Be very careful about making a rushed decision. There are some recommendations in the report that have been made on questionable data. Please remember the impact on Alberta from the National Energy Program in the 1980’s. Thank you [Information Removed]
RRE3310 Dear Mr. Premier, I have been intently listening to both sides of the arguments and proposals related to the Royalty Review Panel Report and Recommendations and I am very concerned that the Alberta Government may go too far in attempting to increase revenue from the oil and gas sector. I have been speaking with many of my colleagues within the industry and outside the industry and I am hearing the same concerns from all of them. The key concerns are: - the analyses and data used by the panel contain errors and flawed methods, - royalty increases are being proposed at a time when activity is dropping and could drop even further (Alberta is already a high cost basin), - the calculation of government take has ignored significant other contributions such as land bonus payments, and - that the full story does not seem to be getting to the public as there are many conflicting views that do not seem to be using even the same information. This is too important not to get it right as the risks of being wrong are staggering. In these situations, in my opinion and experience, often the best approach is to take small, measured steps and assess the impact prior to taking further measured steps. An analogy to this may be how the central banks manage interest rates. There are never large changes but rather measured movements that are assessed and then adjusted as or if needed. I appreciate your time considering this comment. I have also attached a letter that has been prepared by Canadian Natural that contains further comment. Yours truly, Rick Palmer
RRE3311 Frankly, in light of what is going on I am very concerned about my future employment in the gas industry. Earlier this year we pulled all exploration and drilling capital from northern Alberta and as a result, 20 employees went down to 15. Dispite the so called boom, international companies like the one I work for are cautiously optimistic, they have been pulling in the purse strings all year and the threat of a royalty increase with the low gas prices and increasing costs may the straw that makes them break. The price of gas being what it is has limited the accessable funds available to us in an internationaly competative market. We (Canadian entity) again are forced to justify our existance and support with dwindling stats and why they should investment their dollars here. IT is nothing for them to direct it elsewhere. A key argument used in the report to support the recommendation to raise royalties significantly is the assertion that “government takes” elsewhere in the world are higher than in Alberta. But, this assertion is meaningless without comparing cost structures, well productivity, reserve sizes, and reinvestment levels. To deal with these issues, financial analysts typically compare returns on capital employed to determine which jurisdictions provide the best returns for those investing the capital. Our corporate experience is that our Canadian operations generate some of the lowest returns in the company. With regard to gas projects the ARRP report suggests that approximately 80% of gas wells will see reduced royalty payments if the recommendations are implemented. However, our analysis shows that this would occur only if gas prices were to decrease to approximately $4 per mcf. At more current levels of $6.25 per mcf, the proposed royalty rates are all above the old ones. Our assessment is that at the price levels we need to support investment in many of our gas projects, 80-90% of gas wells would pay higher royalties. Today, with existing royalties on gas, rig utilization in Alberta is running at about 40%. If industry activity is already in decline in Alberta, higher royalties will only decrease activity further. Before implementing the current proposals, the Government needs to fully understand the impacts of proposed changes so that we do not stall investment which is the real driver of our prosperity. Please be careful in what you do, my future is at stake... because the additional money the government wants must come from somewhere, and in all probability it will come from capital and operations – the very spending we undertake to support the wider economic benefits. Thank you. [Information Removed]
RRE3312 We elected the government so that they can do the planning and managing the province for us. But with the deteriorated infrastructures and high housing costs we can see that the government didn’t do the proper planning and with the Royalty Review we can see that they failed to get us the rightful royalties we deserve too. It’s not just the present Tory government should take the responsibility I think the previous leader Ralph Klien should be charged with negligent for failing the Albertans.
RRE3313 I am writing to express my consternation and dismay over many of the recommendations made by the Alberta Royalty Review Panel (“the Panel”). As an Alberta taxpayer, I do not support the adoption of many of the Report recommendations by the Alberta government. I strongly urge you to take the time to consider the recommendations and the basis on which they were made, to consider the long-term implications for Albertans, and to perform further analysis using more complete and accurate information. This is an opportunity for the Conservative government to consider all the facts and find the right balance between royalty revenues for Albertans, and maintaining and supporting a vibrant, healthy oil and gas industry. If the recommendations are implemented as they are presented in the report, Albertans may receive a higher percentage of oil and gas revenues (i.e. a bigger piece of the pie), but the amount of oil and gas revenue will certainly drop dramatically (i.e. the pie will become much smaller). As a result, Albertans will be much worse off than we are currently not getting our “fair share” of oil and gas royalties. Alberta has enjoyed a period of prosperity due in large measure to benefits arising from investments made by the oil and gas industry. If $2 billion is taken out of the Alberta economy in the form of additional oil and gas royalties, the amount of capital spending by the oil and gas industry will severely decline, and Albertans will be faced with unemployment, a depressed economy, and reduced government revenue not only from royalties, but from corporate and personal income taxes. In reviewing the report written by the Alberta Royalty Review Panel and the subsequent analysis and comments provided by industry (such as CAPP, Tristone Capital, various corporate analysis), it appears that the report recommendations were made on the basis of incomplete and inaccurate information. The Panel focused on the percentage of oil and gas revenues to be collected by the Alberta government, but it did not consider the current cost environment, or the return on investments to be made in the future in the oil and gas industry. The cost information used by the Panel was out of date and based on data from a gas price environment very different from that experienced today. In addition, incomplete comparisons were made of Alberta’s royalty regime to the regimes of the United States, Venezuela and Norway – only revenues were considered, not the costs and the return on investment, nor the Alberta revenue received from lease bonus bids of $3.5 billion in 2006. The Panel only did not consider the decline in oil and gas investment that would result in removing $2 billion in the form of additional royalties, it also did not consider the accompanying reduction in government revenues from the related drop that will occur in lease bonus bids, freehold mineral taxes, and personal and corporate income taxes. To be fair to the Panel, the current royalty regime is very complex and there are many variables which affect the oil and gas industry. A benefit of the Report has been the forthcoming of additional information on industry costs, and the inputs into investment decisions made in the oil and gas industry. The Alberta government now has the opportunity to use more complete information to calculate the effects, benefits and costs of changing the Alberta royalty regime. As an Albertan who has lived in the province for 37 years and is employed in the oil and gas industry, I strongly encourage you and all members of the Alberta government to fully review the Panel’s report and recommendations in light of the information recently provided by the industry and research firms which highlight the inaccuracies on which the Panel’s recommendations were made. The public has been sold the Panel’s recommendations through the media as Albertans having missed out on $2 billion per year, without the balancing facts of what removing $2 billion in royalties will do to the prosperous economy that Albertans have benefited from. The government of Alberta is responsible to educate the public on the implications of accepting the recommendations as they have been presented, and to ensure that all the relevant information is considered before making drastic changes to the current royalty regime. Please consider all the facts and find the right balance between royalty revenues for Albertans, and maintaining and supporting a vibrant, healthy oil and gas industry. Sincerely, [Information Removed]
RRE3314 I think it is absolutely appaling that the government is ready to jeopardize the many years of hard work that the people of Alberta have invested into making this such an economically prosperous province. The oil industry drives Alberta's economy and if the government implements these proposed royalty changes it will push out major capital investment and the job opportunities those investments provide. I urge the government to re-evaluate their position as the province is well off now but could stand to lose plenty in the near future if these royalty regimes are implemented.
RRE3315 regarding you doing this you'll be taking away my husbands job. My husband is the only one working in our family because it wasn't worth it for me to pay a babysitter to watch my children and not make any more money to support to help out .so please do not do this
RRE3316 As a born and raised Albertan, I am very proud of my province, but I am ashamed of the lack of concern the Alberta Government has shown in acting as stewards of our resources and environment. The natural resources belong to the people of Alberta just as Lougheed stated when he renegotiated the oil royalties. As my government, you should ensure the long-term stewardship of our resources. We need to get our fair share of money to combat the problems of growth, increasing pressure on Alberta’s healthcare and education as well as social services. Most importantly, we need the money to take care of our environment that is being threatened by large-scale oil expansion. Every Albertan knows that potable water and clear air are more important than stripping our national resources so quickly we have nothing left for the future. What’s the point of the Alberta Advantage if you can’t drink the water, can’t breathe the air and can’t afford to build the best healthcare system in Canada. I had hoped the Premier Ed Stelmach would be a leader with backbone (we haven’t had one of those in decades). He should realize that with the American and Chinese oil dependence he is in a strong position and all the corporate oil posturing is a lot hot air. I’m a businesswoman who was educated at the University of Alberta , never misses the opportunity to vote in an election and have worked corporately in Edmonton and Calgary, I understand the pressures, but I also know when I have a solid negotiation position. Let me put this in more political terms, if this government wants to retain power than it better show some leadership, vision, backbone and not be afraid to do what its job. We Albertans want our fair share. Oil corporations are posting billion dollar profits per fiscal quarter. Every four months oil corporations are posting billions in profits and we are struggling with the pressures of unchecked growth. I’m pro-business, but not pro getting hoodwinked by a bad deal. Premier Stelmach and the Alberta Government , I request you do the morally and poltically right thing and make the tough decision to ask for our money so we can clean up the messes left due to the Klein government’s lack of planning. Worse case scenario you and your government would for once look like it was leading and not in the pocket of oil interests. Moreover, you would truly act as stewards of my and other Albertan’s natural resources and inheritance. Albertans elect dynasties but we also banish governments. Talking with my friends that are as concerned as I am the consensus is that how you deal with this issue will determine how long you will govern. Step up to the plate and be the leaders we need you to be and not the oil lackeys everyone thinks you are. Oil companies may bankroll election campaigns, but Albertans have always known that but have ignored it because that’s the price of doing political business in Alberta. But times have changed and our environment can’t sustain the expansion. I think you will find the next election a tough sell no matter how much Calgary oil cash flows into party coffers. I beseech you as a proud Albertan to hang tough, get our cash and build the best province. I thank you for your time and hope that this feedback initiative is not just a PR ploy and that you, my government, are really listening. If you are, you know what to do and that’s get our money that we need to grow, thrive and maintain the best province in Canada. Thank you. [Information Removed]
RRE3317 I urge and plead the Government to review this panel and the report again. Although its mandate is to increase royalties which definitely be achieved but not at the cost of these oil and gas companies. Be fair and balance it out. Make it possible so that these companies can remain profitable as they are very important to Alberta's economic growth. Do not push us into recession, higher unemployment and crime rates. thank you
RRE3318 Our Fair Share My 1st glace at the report indicates this title is misleading. I skimmed it quickly so this message reflects my gut reaction and it may change after a careful reading. This is my reference point - I live on an acreage by Olds – an area with abundant wells and processing facilities - I have no revenue off my land – this is a life style choice, and my horses and land are for pleasure and represent an on going expense - I have a white collar job in Calgary and my employer is in the energy industry - I rely on surrounding towns and rural neighbors for services and feed for my animals Our fair share consultation process - I was totally unaware the public was invited to the table. I must admit from a rural point of view the focus is on the EUB fiasco with the power line right away. And this is related since it is destroying the EUB credibility and the EUB in my mind is directly tied to royalty schemes - Since I was not at the meeting I will recap the type of information I would have provided. And, yes, I run the risk of my thoughts fitting into the comment covered on page 36 “outside the terms of reference, and of the scope of recommendations the panel can make”. Just keep in mind my understanding is to make the system fair. o Current personal benefit from existing plan: Extremely Unfair. Over 10 billion is currently collected (works out to be $2,857 per person) and my county (Mountainview) receives total grants from the province of $253 per person – this is the only distribution of royalties that I know of. The 10 billion is 29% of the provincial revenue so 29% of the 253 is $73. A fair share of royalties is not represented by a asset owner-to-owner agent ration of 1 – 38 o My impression about receiving my fair share of wealth from the industry is not about how much royalty is collected but impacted by my impression and what I see in how the government handles this revenue. Increasing a royalty from $10 to $12 billion does not help with this point. My confidence in the government to manage these funds is very low. Where did the last 100 billion go? o The land owners that are required to allow pipelines, wells or related processing facilities do receive a payment. And, yes, it greatly exceeds the $73 the province provides. Is the $1,000 - $3,000 provided per well adequate – in many cases it does not compensate for the impact on quality of life, ability to develop, land value, or work the land. This is one of the key elements I though “Our Fair Share” was going to address o Rural people take the entire brunt of the energy industry. Urban people get away with the not-near-my-back-yard principle. I live in both worlds. Is it fair that the distribution of royalty funds in the form of grants is tied to population – and that means urban people see the most benefit while the people who bear the brunt see so little benefit? o I do agree with the comment by the press on page 35 that having 224 individuals or organizations submit input as being LOW TURNOUT. I ignore the 56,000 web site views since they did not contribute anything and does not indicate the viewer received any value for the web site hit, or the number of actual people. This is a very small piece of the 3.5 million Alberta people and a number of companies that I can’t even guess at. I would definitely question the value of this input. I may have to review the content to finalize my opinion o When I think of being fair, I include the owner of the resource, the government, the companies that produce the product, and the public who are impacted. In the review summary on page 20, you will see that the “public” is missing from this list. So everyone is not being included in this fair calculation Basically, I do not see that the concerns I have were even considered in the review. All I see in the review is the province looking at what it receives in royalties and compares it to others around the country or world. This reminds me of union negotiations where one trade got $10 so the other has to have it. Where in this comparison did this review look at what these other groups delivered as measurable value to their people? I did not see any info. My impression of the impact of this report - Companies will review all planed activities to take in the financial impact of all the recommendations. Projects schedules will immediately be impacted. I expect the stock market to be more volatile with it ending up lower overall - I expect my company to immediately fund projects outside of Alberta and request local ones to go into intense “what if” financial simulations to ensure that they meet the minimum financial returns for all possilbe combinations resulting from this report. More internal costs. I predict an overall loss in spending in Alberta as more activities drop below the required return level - My understanding of corporate finance is that the government will continue to collect taxes/royalties and the share holder will still expect the stated rate of return. And the company has no choice but to meet both of these obligations. So with the company not able to reduce these costs, savings will be obtained elsewhere. That is bad for me and my community - Industry cost savings have to come for internal operations (that is me), service companies (the business in the towns around me), support industries (hotels, vehicles, restaurants….), or be offset by higher costs for the products we sell - I expect a direct financial hit. My payroll will not grow as expected – it may be reduced, frozen, or performance incentives will decrease – I do not see any possibility of a positive impact. Today, most of these are paper losses – at year end and early next year they turn into real cash that is not in my pocket. - The amount of the unknown financial hit means I have already delayed the purchase of a replacement truck and horse trailer. Uncertainty has immediate impact. This impacts my local suppliers - Many of my neighbors are employed directly in the energy industry or supplement their farm income by applying a trade that is used by the energy industry or its suppliers For most, farm income alone cannot support them. So the local truck wash, UFA, welding shops, building fabricator have to plan and guess at what the impact will be on the industry. I expect to loose my neighbor supply of hay if my neighbor has to work harder or further away – crop land will become grazing land as there is no available time to work as a farmer - I expect the students who attend the welding classes at Olds College will be thinking about what happens if their skills are not required in the oil sands. Is it still worthwhile to take this training? Make alternate plans and attend a school outside the province? - Since this is a government initiative I have a tendency to compare it with past initiatives. The most recent being the Energy trust change, and the last big one being the creation of Petro-Cananda and the national energy program. Both of these events had a large – and not positive impact on me. This royalty review looks like it is heading some same way and I cannot help but compare it to what happened with the NEP. I really need to see some positive indications or planning for the worst mentality will quickly kick in. Provincial and federal politics is starting to blur - I will also make plans to capitalize on a radial down turn. I maybe able to invest in something that will allow me to benefit as businesses models fail - This report does not help with the initial principle “The energy resources of the province belong to the people of Alberta” since I have a lot of difficulty in relating the recommendations to the principle. I don’t know why since it is supposed to be the fundamental premise used. How is this asset being used to help me, my community, local towns or anyone in the province? Change the $12 billion collected into something tangible – and no – the $74 that appears in my county budget because I exist in a census does not do it. - I totally agree with page 94 that describes the lack of a transparent royalty scheme and that disclosure standard and not being met. The real sad part is that I am seeing billions of dollars go into a government hand and this agent never trickles the money back to the asset owners (the people of Alberta). It is broken and must be address now – before any royalty rule changes. So, as my Agent for these resources, I need to see how the report impacts - The land owner. I would like to keep the royalties out of the government hands and put them to work locally. Change the split and increase the amount paid by using any of your formulas. But get the money into Albertans hands so it can be spent locally. I have lost confidence is the government with their ability to handle these funds. - The current grant process is a joke. It does not reflect the impact of the industry on rural life or cover the resulting costs. The head count method to trigger grants is broken – include land impacted, number of wells or the impact of the facilities. The well or compressor station as the potential to disrupt or destroy my life. Use the royalties to offset this and reflect the true local or regional impact - Offset the royalties with industry initiative to improve rural life or reduce the impact of the industry. I prefer to see the next gas well to be totally underground instead of 20% of its revenue going into the government bank account. The well change is something immediately worthwhile. The money in the government bank account may never be seen by me - I sense that my Agent has lost touch with the Alberta people – this has to be fixed or the government will not have any credibility to the people or to businesses. Show a benefit to the people on why the board exists and the value of this type of recommendation. Work with the businesses so the changes do not force them out of Alberta or scare investors - Placing the entire economic impact of the initiatives on the company will directly impact my county and me financially – and I do not perceive any value. For some reason the share holders and the governments continue to get their share. The money the government gets has to come from somewhere – cost savings or produce price increase – both of these impact myself and the public. Remember and use the Fair Share principle that is referenced. - The companies involved in the energry business will form their own response. I expect a higher percentage will be displeased and a few will be really [expletive] General comments With the current royalty process I can not associate county payments / grants – any payment to the asset owner – to the money the government collects as royalties. In my county budget all I can detect of the $10 billion currently collected (amounts to $2,857 per person) is a conditional grants totaling $253 per person or $864per sq KM . 29% ($73) of this amount is from royalty fees acording the the provincial budget. I do not know if there are any funds that I receive directly from the government which can be associated to the royalties collected. Currently each year the province collects enough royalty money to pay for 39 years of grants. Where is the fair share? I do not see the provincial rainy day fund increasing by the missing 38 years worth of money My point here is that the province residents (asset owners) are not receiving their fair share in current payments or a future rainy day fund – and this new report does not indicate anything will change. With this royalty review the increase amounts to $3,429 per person (asset owner) – even if the county grants increased by a matching 20% ($88) - something is still wrong – when there is only a couple of % of the royalty payment making it to the asset owner. Corporations like Enron or people like Mr. Black go jail for actions like this. There are many ways to make the current system fair – the report lists many options. Just increasing grants to cities or counties will not do the job. The report continues to have a royalty going to the province bank account first – without changes this is a waist of time and money - add a component that keeps the tax out of government hands (unless they have the skills to manage on our behalf). Share by providing the asset owner, geographic area which is impacted compensation based on land impacted, or the number of wells / plants or other infrastructure that impacts the lives of residents. That is all I have time for. Thanks for listening [Information Removed]
RRE3319 Implement this royalty and your goverment will have a short term in office. This royalty will cause a recession like you never seen before.
RRE3320 It is about time Albertans get a bigger piece of the non renewable resource pie. Do these companies think the energy will last forever? The rush to the oil sands has taxed our infrastructure in every facet immaginable. The influx of population to support the oil and gas rush has taxed everything from roads, utilities, health care, education and social programs Who is left with that bill? Not the oil companies. If they can afford to do business in unstable regimes, they can afford to do business in Alberta with a fairer royalty structure. Now the question of the day...Can our provincial government properly manage this extra revenue to allow a stable prosperous future for Albertans? I sure hope so. I think we need to model ourselves similar to Alaska. What is the status of the Heritage Savings and Trust Fund? How much is it growing? We need to spend some time focusing on the future and how we will allocate any new monies.
RRE3321 Once again, this our Conservative government trying to throw Albertans under the bus! It is clear to me that Stephen Harper and Ed Stelmach are doing everything in their power to bring down the prices of all stocks tied to natural gas and oil. If this passes, it will be another huge kick in the teeth to people who have invested in Alberta's resource stocks. Last Halloween wasn't enough of a blow, now the Conservatives want to undermine our energy sector once again! Not only will this cripple stock prices and many people's retirements, but it will seriously affect the incentive for the big oil and gas companies to explore and drill and in turn will have a hugely negative effect on our economy!!! Can't our Stelmach government see that??? This could devastate Alberta! The oil companies have already started to slow production to bring down costs. If they have to pay a lot more in royalties, it will slow even more, and there will be even less money going to the government! Please really think about this! The Harper government has already alienated a lot of Albertans and Mr.Stelmach is doing his best to alienate the rest! [Information Removed](former- (Thanks to Stephen Harper), #1 Conservative supporter!)
RRE3322 I am concerned about the proposal for increased gas royalty rates in Alberta. Previous to the announcement of the potential for royalty increase, [Information Removed], (I am an employee) has already decreased it's North American budget by 1/2 billion dollars because of low natural gas prices and reduced profitibility on what in some areas are marginal wells econonically. I'm concerned that increased royalties will further slow down the economic activity of gas drilling in Alberta and it's spin-off economic benefits. Sincerely, [Information Removed]
RRE3323 I am sending this letter as a concerned Albertan who, although not employed directly or indirectly in the oil and gas industry, can not help but think the implementation of the recommendations of the royalty review panel will have a negative impact on my financial well being. I can understand that the government may want to control the rate at which the oil sands are being developed and I support that initiative. I’m sure I share all Albertans’ concerns over the possible impact these developments are having on the environment, not to mention what it has done to the availability and costs of services such as plumbers or electricians throughout the province. However, I am also aware that it has been the conventional oil and gas industry that has fuelled the Alberta economy over the years and that the proposed changes will have a significant impact on that industry. Common sense tells me that any changes to fiscal policy that will negatively impact an industry will certainly result in a decline in the investments that same industry would consider making in this province. I implore the government to assess the impact of this during its review process and give serious consideration to the consequences of a turndown in the conventional oil and gas industry. As this industry is the engine of the Alberta economy, repercussions will spill into small business, the construction industry, manufacturing and real estate, to name a few. It is my opinion that this government should not create an environment of fiscal change and uncertainty that will drive away future investment. Alberta’s economy has thrived because it has offered people, industry and business an attractive province in which to establish roots. Please consider carefully and fully all consequences of what is being proposed.
RRE3324 I fully support the views expressed in the royalty review report. All reccommendations need to be implemented by the government for the well being of all Albertans. Oil will not leave this province, there is still money to be made for them under this plan.
RRE3325 I manage a rig with a crew of 5. All of us with a family to take care of. That means if you get greedy, it'll affect 20 people associated to this rig. That is only one rig out of many. Please make sure you make the right decision. [Information Removed]
RRE3326 I was deeply concerned after reading the report from the royalty review panel. What I found the most concerning was the fact that a rise in royalties of the proposed magnitude may scare of the large amounts of capital required to get many oilsands projects off the ground. There are a number of smaller companies currently pursuing smaller in-situ projects which will still require several hundred million dollars each of capital. These companies do not currently have production large enough to generate the kinds of revenues to support these projects so they are forced to raise capital in the equity markets. Take for instance [Information Removed]who just [Information Removed]commissioned their [Information Removed]project, this would not have been possible without raising several hundred million dollars of funds. Some of the more notable smaller Alberta Based companies which will require capital over the next few years for their projects include: [Information Removed]and several others. These projects are not the prime projects that we see from the likes of [Information Removed]etc., they are less robust projects and the proposed royalties may cause some of them to not be funded. By making it more challenging for these projects to get the money required you are opening the door for larger, multi-nationals to develop the projects. This is a shame as many Albertans are working very hard on these projects and are also investors in these projects. I believe that the royalty review panel has carried out both a superficial and incomplete assessment of a change in royalties. It is my belief, that they have identified the maximum rent available to the province; they have however lacked the wisdom and sophistication of what they have framed. The oil industry is a margin business both because of the maturity of the basin in the conventional business, but also the very nature of the oil sand business. When a margin business losses a material share of net revenue, in this case in excess of 20% there is a material shift upwards in the required commodity price for many of the projects to proceed. We have seen this in gas drilling in 2007 with 40% fewer gas wells and a decline in production of close to 1 billion cubic feet per day. The impact of the recommendations would be expected to include: 1. A decline in activity until commodity prices rise to support project development. 2. A compounded effect of that decline as the required investment capital is reduced in availability, increased in cost if raised and therefore further increasing the required commodity prices to advance projects. 3. Service sector companies through reduced activity will see the erosion of the volume and value of work and employment will decrease. Alberta’s GDP may be much less than it might have been and government revenue may in fact shrink as they garner a thicker slice, but of a smaller pie. Other points would include: 1. The principle of ability to pay is distorted by the proposed (OSST) oilsands severance tax. This is a gross tax where at current prices it is not the ~ 5% impact on the net to a company but potentially a 10-12% impact from cash flow available to a company as there is no deductibility in tax or other cost factors. 2. The proposal shifts foreign exchange risk to companies. In other words government revenues would be insulated from changes in exchange rates this of course is at the expense of the company share. The severance tax in combination with the foreign exchange risk becomes regressive in lower commodity prices, this will make any slow down worse. 3. The bitumen price question has a potential to be a significant and serious wild card to the determent of companies and perhaps the province. There is clearly a transfer price question for integrated projects. This should be addressed; however a non-integrated project only receives what it can. If deemed prices calculated by a formula do not reflect market prices either the government or company will lose, clearly not an objective. This recommendation in particular is very problematic and not well understood, notwithstanding the recommendation made. The harsh criticism of the committee to others would be particularly well applied to this recommendation of their own. 4. Small companies will be under pressure. In a margin business scale is everything. Wal-Mart is both respected and despised for what it is in the retail margin business. In the oil business this will increase the pressure on being big to survive. The numerous small companies of the conventional, but more particularly the oil sands will be consolidated. The business will be more dominated by the multi-national and activity will be constrained.
RRE3327 To whom it may concern: I have read the report concerning the royalty review of the Oil and Gas industry. I have several comments to make regarding the report's preparation and conclusions: 1)The panel was extremely biased. The panel did not include one person who had any experience whatsoever in upstream conventional oil and gas operations. Mr. [Information Removed] had the greatest amount of industry experience, which seems largely restricted to midstream and heavy oil projects. This experience is extremely limited when compared with the scope of various oil and gas projects undertaken in Alberta. There are several types of developments, all of which have their own unique economic challenges. The economic viability of the range of real projects in Alberta should have been analyzed, not just artificially modeled cases. It is likely that the economic viability of many of the deeper and exploratory conventional projects will be badly damaged by the proposed royalty changes. 2)There was very little attention given to the different costs associated with exploiting the various types of resources. Some play types require high initial capital with high stable rates, others have high initial capital costs with high but rapidly diminishing rates, and other plays require low capital but have low potential rates. The proposed royalty scheme does not seem to differentiate between these quite different resource types. Some of the various types of projects are summarized following: a) Deep foothills or Devonian exploration: These wells are extremely expensive to drill, and generally quite deep. They can cost in the tens of millions of dollars and take several months to drill. Planning and regulatory approval for these wells often takes several years. In addition, terrain and sensitivity of the environment in foothills areas results in extended time required to place these wells on production. The proposed royalty scheme does not allow for the costs associated with both the extended time and high capital required for these wells. b) “Deep basin” tight gas wells: These wells are characterized by high initial rates stemming from large fracturing stimulations, and subsequent long periods of low production rates. The economic viability of these wells depends on the initial “flush production” to pay out the high capital costs associated with the relatively deep drilling, and very expensive completion. The proposed royalty scheme penalizes these wells in the critical early phase of production. Much of the future potential for natural gas production in Alberta comes from this type of play, especially in the largely yet to be discovered shale gas plays which are currently struggling to achieve commerciality. It seems unwise to penalize a play type that is still working towards economic viability c) Shallow gas and Coal bed methane: These wells are characterized by shallow drill depths, low production rates, and relatively high amounts of produced water. These resources can be exploited by either horizontal wells or vertical wells. Horizontal wells cost more, produce at higher rates, and reduce surface impact by taking the place of several vertical wells. Under the proposed royalty scheme, there would be greater incentive to drill vertical wells, as there is no allowance given for costs. 3)The panel seems to be unaware of the fact that the finding and development costs for oil and gas in Alberta are the highest in the world. This is due to small pool sizes, high labor costs, extensive environmental and safety requirements, native consultation requirements, and slowing regulatory approvals. None of these factors seem to have been considered in the report. 4)Many of the major American or International based companies have cut their budget for Canada in 2007, and appear to plan to do so in 2008. Instead, these funds have been diverted to cheaper projects the United States and other international locations. It is extremely telling that drilling for natural gas production has increased in the United States this year, while declining in Canada. Many of the government officials have called industry claims of moving elsewhere as false threats. They fail to recognize that this has already happened because of labor costs, and low natural gas prices. International companies have moved the capital they have to international projects, and domestic companies have faced greater challenges in raising capital for projects here in Alberta. 5)The report states that 82% of natural gas wells would actually pay less in royalties, referring to the lower royalty on low rate wells. The remaining 18% would pay higher royalties. The problem with this is that it is predominantly older wells that would pay the lower royalty as they have declined to lower production rates. Newer wells, producing at higher initial rates would therefore pay proportionally a greater royalty. This tends to favor companies with an existing production base, but discourages new investment. 6)The proposed royalty rate changes unfairly favor shallow, cheaper wells. For example, a lower royalty would be paid on 10 wells costing $500,000 each producing at 100 mcf per day then 1 well costing $5,000,000 producing at 1,000 mcf per day. This imbalance would tend to discourage deeper drilling in the province. This is of great economic significance as most of the new large pools yet to be found are likely to occur at deeper depths. One of the large problems in industry is the over exploitation of shallow resources, which removes the possibility of “bail out” zones when drilling for deeper and higher risk reservoirs. If anything, the government should be looking at the decrease in deep drilling activity and trying to find ways to provide incentives to find these deep reservoirs. 7)The royalty review panel ignores the likely decrease in activity that would result from increased royalties when making their government revenue projections. In addition, the panel does not look at the broader economic effect of less capital flowing into the province. Surely the decrease in economic activity in the province will be much greater than the 2 billion yearly that the province hopes to collect. The royalty review report seems extremely limited, and rushed by the authors own admission. The panel is unbalanced, and seems to be out of touch with the challenges currently facing the industry. An example is Mr. [Information Removed] comments in the media claiming that “cost is in the industry’s control”. Clearly this shows a misunderstanding about the global nature of economics and the fact of the global increase in prices of fuel, labor and steel. Releasing an un-reviewed and prematurely completed report to public can only mislead and confuse people. Unfortunately, the public does not generally have the background information necessary to evaluate this report. It is the government’s job to inform the people as best as possible to make educated and balanced decisions. This report fails to do so. This report serves to foster a false and negative image of the most significant industry in our province. I believe it is negligent of both the government and the royalty review panel to publish a report like this, without appropriate review. Such one sided reports are extremely damaging to the reputation of the Canadian oil industry, which relies heavily on investor confidence. In 2005, the industry paid 14.3 billion dollars to the province and spent a total of 35.5 billion dollars. It is the single biggest economic sector in Alberta, and one of the main reasons for the current strength in the overall Canadian economy. I urge the government to undertake a more thorough study of the issue before making changes that could severely damage our economy. [Information Removed], MSc.
RRE3328 I'm an Albertan voter in my fifties and I believe the report should be implemented as is.
RRE3329 Things are so overheated economically in our Province! It has to slow down - the exagerated escalation of costs will in itself have a deflationary and slow down effect. Encana would love to have someone else to blame for their $1b cut back - but they are going to n\have to do it anyway. The oil, the gas, will be in the ground no matter when we pull it out - it is not going to go away. Any increases in Royalties is bound to bring out resounding howels from all secrtors of the industry - but the industry is already slowing down in response to the price gouging of the supliers to the industry. Stelmach must raise the royalties. For his political survival, he must be smarter amd cagier than the smart guys in the head offices. BUT HE MUST RAISE ROYALTIES FOR THE GOOD OF ALL FUTURE GENERATIONS. What about this - grandfather the contract that are in place - but now take 50% of all oil revenues that are above the price of oil when the contracts were signed and the price on which the oil industry decided to start up their various projects. WHAT COULD BE MORE FAIR! [Information Removed]
RRE3330 This is terrible, the amount of money the government has been making off the oil industry for the past 50 years or more, and it's not good enough? Instead of talking about all the money the province is losing on royalties, why don't you guys go vote yourselves another raise??? Does noone remember the 80's??? Do we really need to repeat? The economy is already slowing down, if you directly attack the oil companies, how do you plan to sustain our economy? If the energy sector is supposed to pay more in royalties, is the Alberta government going to chip in and assume some of the risk involved in drilling a well in the first place? You time would be better spent trying to come up with stricter laws to help protect the children of our province.
RRE3331 As a person who makes his living in the oil patch and is also a concerned Albertan I think the Province is missing the boat with this review. The royalty structure was designed to promote investment in the oil and gas industry and this has been achieved. Now to change the rules once the game has started isn't right. To reduce the industry's share will only stymie development.
RRE3332 Mr. Stelmach, I am writing you today to express my extreme concern with your proposed increase in royalties paid by oil and gas companies to the provincial government. You're proposals are not only dangerous, but also ill-advised. Even under the current royalty regime Alberta IS one of the richest provinces in the country, Alberta has NO debt, and Alberta HAS the Heritage fund surplus, what more can you take without crippling the Golden Goose to use a metaphor. The oil and gas industry is undoubtedly one of, if not the primary economic engine of this province. The economic benefits from a vibrant oil and gas industry are propelling this province towards a future that is recognizable on a global stage, both through job creation directly and indirectly and foreign investment. If you and your think tank believe increasing royalties will give Albertans their “fare share”, think again. Oil and Gas companies have invested billions into acquiring/developing land, and building infrastructures within the province of Alberta to explore, drill and produce hydrocarbons. If you increase royalties the way you and your think tank recommend, companies will be forced to pack up and leave from operating in this province. You and your Government will loose countless revenue from the Land sale process, the Lease fee’s and in essence stranded hydrocarbons which will become cost prohibitive to develop under your “think tanks” recommendations. Not to forget foreign investors will look elsewhere, again accelerating the drain on our provincial economy. It doesn’t take a Minister of Finance to realize the domino effect or negative spin offs spawning from your proposals which will undoubtedly echo throughout the province with an eerie sound. Countless service companies and other industries will be out of work in Alberta that would normally be involved in helping develop this provinces hydrocarbon resource because of drastically fallen drilling activity and cancelled projects. Every demographic of our province will feel the economic disaster from your proposals, from corporate CEO’s right down to the worker at Tim Horton’s. Already many big oil and gas companies have started to reallocate millions of dollars in their budgets away from Alberta due to the uncertainty generated by your proposed royalty hikes, tell me how this is a good thing? Talisman, Encana, Canadian Natural Resources, Conoco, Crescent Point, just to name a few. With nearly $84 US dollar oil rig utilization is only at a mere 45% in this province (again uncertainty from your proposed policies), the numbers just don’t go around. Use wisdom in your decision, remember the National Energy Program from the early 1980’s? I supported Ralph Klein. To be blunt you and your party will no longer have my vote if you do not consider carefully what you are about to do
RRE3333 don't increase the royalties. too many jobs depend on resource investment.
RRE3334 End the give away of our resource. the new rates are still too generous. their greed should be the incenive. [Information Removed]
RRE3335 Hon. Premier of Alberta: I'm quite concerned about the possibility of full implementation of the Royalty Review Report and feel it is an unnecessary risk that the government is taking. I believe increases in Royalties will make a lot of oil & gas projects uneconomical and will result in less investment in Alberta. Less investment would mean job cuts and overall slowdown of the economy. In any case, Alberta does not have any debt and getting more money on an already surplus situation would not help at all. I believe more time and resources should be spent on solving the growth problems that we're facing (i.e. efficient utilization of tax payers money) rather than trying to raise more money. In my opinion, even the publicization of the entire process was inherently wrong! The average person does not understand the way economics work , all they now percieve is Big Oil vs. Us, that not what it is. Its a symbiotic relationship between people and Big Oil, we need them & they need us. I would strongly recommend against changing the current Royalty Regime. If the economy is overheated, let the market balance it out and I can see that happening. The high construction costs have already resulted in a decline in number of projects being viable. A lot of Engineering companies have already cut at least a 500 jobs in the last week. Hope the decision you make will assure the Albertans of a bright future. Best Regards, [Information Removed]
RRE3336 I believe there is no need for increase in the present royalty rates for the oil and gas companies. Our province is prosperous! If the government increases the royalties and the taxes to the oil companies, the economy and the employment rate in Alberta will be seriously affected.
RRE3337 Talk at my company is that they will be slashing winter drilling projects. Yesterday they cut one of my Exploration wells. To put it into perspective: That well costs $4MM to drill $5MM to complete and test Would have employed 87 people over the course of 65 days Please tell Ed the oil companies aren't bluffing. Our project approval dates have been pusged back .
RRE3338 The recommendations from the review panel might seem as a go ahead for the government But the government should take time to do the due diligence and assess the real impact of such royalty on the business and the industry in general as the proposed royalty system endangers projects profitability and consequently future investments. Please take more time to assess the situation to make the right decisions. Regards, [Information Removed]
RRE3339 I dissagree with the panel review.
RRE3340 I disagree with the premise of the report that Albertans aren't getting their "fair share" of oil revenues. At present, Albertan's get a very hefty chunk for putting up absolutely no capital and taking not a shred of risk. It has to be thought of as a partnership. The province/Albertans may own the resource but they have no way of ever realizing the value of those resources without the efforts of a vibrant oil industry. To suggest that they have been getting secretly "ripped off" for years is a complete fallacy intended to rally the uninformed man-in-the-street behind this ridiculous report. The process to conduct this report was very one-sided and it is only after the fact that the "dialogue component" is being hastily tacked on. I would rather believe the opinions of industry executives and technical experts than the opinion of a senior FORESTRY worker. Could you not have found someone in this vast province with some street credibility to shepherd and advise the government on this entire process? I think it speaks to the Premier 's lack of understanding, experience and networking. What we DO understand in the oil industry is the impact of risk and uncertainty for everything. We have to forecasts costs, we have to forecast world pricing and Mother Nature's ability to deliver the reserves reliably. This is extremely difficult to do and yet companies still have to invest billions UPFRONT with no guarantees whatsoever. At least our own province could provide some stability in the royalty regimes. If there is a feeling that the royalty structure needs to be reviewed, I think you would find a group of very informed, experienced and UNBIASED folk in the industry who would have welcomed an opportunity to work collaboratively on such a project. To portray the industry as trying to "bully" the Premier is spin doctoring at its lowest. There are no bullies here, just people who are running companies and trying to return the maximum value back to the investors. The same investors who OWN these companies, not some big bad bully. Check it out, most of these government officials who are slagging the industry for "ripping off ordinary Albertans" are sitting there quite happy with the oil companies' performance as it has enriched their RRSP portfolios considerably I would expect. It doesn't matter what you do in this great province, what industry you CHOOSE to work in but I would imagine that we have all benefited directly or indirectly from the risk-weighted efforts of the oil and gas industry. This is just a cash grab in a high pricing environment. Do you also intend to cover off some of the losses in a low pricing scenario? Unless you are on board for the ups AND downs, like the rest of us oil workers, then I suggest you leave well enough alone. Respectfully, [Information Removed]in Calgary for 26 years
RRE3341 The Royalty Review Panel has not considered the very huge expenses paid by the oil and gas industry that are not fixed expenses. Their report is not accurate. Do not increase the royalty rate charged.
RRE3342 As an Albertan and an employee in the oilpatch, I fear that a self inflicted recession may be on the horizon for Albertans, if the Alberta gov't goes too greedy. I have no problem with adjustments to rolalties that are fair and balanced. Ed would be a fool if he destroys the Alberta advantage and and our economy. [Information Removed]
RRE3343 If the Panel report was implemented as it stands I am afraid that Alberta economy would soon be dead, I Pray that we have smarter people in power that will not allow this to happen. I have always been proud to be an albertan and have enjoyed the alberta advantage. Work hard , play hard has always been the motto of most oil patch workers. I personally have been through the downturns of the past and don't want to see another 1981 for my kids sake and the sake of alberta. It takes money to make money so leave it in the Oil companies hands, they do know how to make money and the spin offs we will continue to enjoy in the alberta advantage.
RRE3344 Panel numbers are flawed. Listen to industry.
RRE3345 I would like to know why our government is trying to mess with the royalty re-structuring and cause massive job losses. I work in the oil and gas industry and the royalty review has already slowed down the amount of work that I have. If this comes in I will be out of work and be un-able to provide for my family. We live in a province that does not have any debt or deficit. By changing the royalties collected not only will the govenment not collect the additional two billion dollars it has forecasted, it will also loose massive amounts of income tax from average citizens that will have lost thier jobs. I personally can not comprehend why our goverment is trying to be greedy and why it is trying to affect lives of the citizens it has been hired to protect and make sound decisions for. I personally have voted each and every time for the consevative party since I have been of age to vote. My decisions have been based on which party was trying to make decisions that would be the best for the citizens of this province. I believe that up untill recently that this has been the case, but now I do not believe this. I would like to know what the government will do for me once I have lost my job and will be on the verge of loosing my house and be unable to provide for my family?
RRE3346 I heaved a sigh of relief at the message contained in the royalty review report. Much like many people have said, the current structure is stale dated by 20 years. The rate of growth, development and stripping the land of resources is out of Alberta's control. That is probably the biggest concern. If we are currently importing trades and skills from all over the planet to hurry up the process then perhaps it is a really good thing to slow down the looting of Alberta and instead of getting all of the development done now, we can give our children and grandchildren a legacy of great careers and not one of environmental disaster. Encana's threat of withdrawing investment is like a looter trying to extort a store owner with the threat of stopping the theft when confronted by the action. This threat is a perfect opportunity for the Stelmach govt. to take back control of the resources from the big bad oil companies. [Information Removed]
RRE3347 To whom it may concern I am writing this response in regards to the royalty report. Working in the oil patch is my main source of income . I work lots on the new construction of oil processing plants.From the information that i have received of the royalty report and the response from the oil companies of big projects being deferred due to the results of the royalty report. I feel that this will have a big impact on lots of families and there lives. I hope that you will take this into consideration and not move forward with the 20% royalty which is outrageous. Thank you
RRE3348 I think with the cost of living so expensive in the province, some profit should be given to the residents that live here
RRE3349 October 24 2007 Office of the Premier Room 307, Legislative Building 10800 – 97th Avenue AB T5K 2B6 Attention: Honourable Ed Stelmach, Premier Dear Premier Stelmach: Re: Alberta Royalty Review Panel’s Report I do not support the implementation of the recommendations of the Royalty Review’s Panel’s final report, titled ‘Our Fair Share’. The panel’s perspective and analysis is very narrow and does not consider the location factors, low returns, costs to conduct business, the impact on charities, schools, and recreation facilities, the wages and jobs for those supporting both directly and indirectly the oil & gas sector and most importantly the stability of our Province and Country. I’ve been in the oil and gas industry for over 25 years, I’ve attended a few celebrations of success and many thank you sessions for those being laid off from their jobs. We’ve had a turbulent time, trying to establish the right business environment to bring in more investment, create more jobs both directly and indirectly in the oil and gas sector. The creation of these jobs is not just in Alberta but across the country. The creation of this business environment is based on a stable political environment. What the report does is de-stable our political environment. Why does your government want to destabilize an industry that has had to endure such a turbulent history to make it viable and make this province what it is today? The panel states that it approximates that the people of Alberta will realize an additional $2 Billion in royalties per year. That is an incredible assumption based upon no impact to the industry with increased royalties and the breaking of existing agreements with companies big and small. I do not want to see tax dollars wasted on senseless legal actions created because the Government of Alberta reneged on agreements. This too creates a de-stabilized political environment. The comparisons used do not make sense to me. Texas and most of the US have a true royalty rate of approximately 12%. As far as I’m aware, Texas has no plans to increase their royalty structure nor do they plan to destabilize their political environment. The report also compares Alberta to 3rd world countries. Are we a 3rd world country? If so then please let the people of Alberta know this is how you and your government perceive us. If not these comparisons cannot be ethically used in your analysis. I understand, Ecuador has moved to 100% royalty and is in the process of ceasing assets from foreign companies. Is this really the environment we live in, is this the comparative basis we want to base the royalty decision on. It is not and this comparison cannot be ethically applied to this analysis. What if there is an impact by increasing the royalties? Companies have already laid people off; others are stating projects will go on hold; money currently slated for investment in our Province to create the future for our children is going to go out of the Province and most likely out of the country. The loss in personal income tax to both the Provincial and Federal Governments, royalties’ losses as oil & gas is not produced and spending in general which generates other income both to the government corporate and personal is not realized. These social economic factors have not been considered by this report. How much personal liability does the panel members or the current members of parliament have to cover these risks? If you agree to increase the royalties and the royalties do not materialize, what is their personal liability if their predictions are wrong? The reason I ask is they are addressing my personal well being, my family’s well being and the well being of most of the people I know. Will the Government use this assumed $2 Billion to pay for the losses to the people of Alberta and if the funds do not materialize, will the Government go into the royalty funded invested trust funds to support all the impacted people in the province? Where is the accountability for this impact? Are you as Premier ready to be fully accountable if I get laid off, if my children who are teenagers have to leave the province to find education and work? This report and the amount of negative support it has created for the foundation of this province, Oil & Gas, are unbelievable. Taking our stable political environment and creating this amount of uncertainty and instability is exactly the opposite of what I voted for and see as your mandate as Premier. Premier Stelmach, please take time to ensure that all factors are considered before acting on this report, that the risks are understood and explained to the people of Alberta. In my 25 years of working here in Alberta, I’ve never voted for any party other than the Conservatives, even though my family was directly impacted by the cut backs by former Premier Klein (my wife and two sisters were laid off, my sisters had to leave the province / country to find employment). This is the first time in these 25 years, my vote will change if this political instability continues and the Oil & Gas royalties are increased. Best regards, [Information Removed]
RRE3350 If the lastest proposal goes through, our company is making plans to close down or not proceed with some projects. Since Alberta's economy relies a great deal in the oil and gas industry, our economy will suffer. The ARRP needs to work with the Oil and Gas companies to come to a decision that will make our province prosper. "We are all on the same side. The decision will effect every Albertan"
RRE3351 The proposed changes will drastically impact the viability of Alberta's Oil and Gas Industry. I do not understand why we should tamper with our flagship industry. So many businesses and services in the province such as retail, hotels, restaurants, construction, service industries do well when the oil and gas business is prospering. Several oil companies are talking of taking their spending dollars out of the province. I don't want to see the unemployment rate rise in this province. Please reconsider making changes to the royalty review - in the end it will hurt rather than benefit most Albertans.
RRE3352 After having read the review, It would seem that the six people on the review panel have taken it upon themselves to speak on behalf of all Albertans. It is also very apparent that the findings were searched out to a great extent rather than researched. Hopefully the release of this very biased review only opens the eyes of the Alberta people to the terrible government mismanagment that has taken place in the past (as is also pointed out clearly in the review), and is being seen again by the release of the panel review before an accurate and COMPLETE review is done. I believe the average Albertan does not understand the complexity of this matter. There are many people that believe the review means another $400 cheque, or that the high oil prices are due only to oil companies trying to gouge them. People by nature feel like they are being worked over, and "everybody" jumps at the opportunity to put more into there pocket,( I know I do) this is why the panels release before it is fully examined is another ignorant move on the part of our government. If an open street random questioning was done anywhere other than downtown Edmonton or Calgary MOST people would first agree with the review .....and then when questioned about what it was or the impact of it WOULD KNOW NOTHING OF IT AT ALL..........Certainly the government holds the responsibility to warn the people of the certain demise of the oil and gas industry should the reviews suggestions be implemented (might want to show some similar charts to those in the review on the collected royalties down the road when production drops off).........This is the backbone of the richest province in the country, and the very reason for our prosperity...Please consider a more reasonable approach......PS..A little stimulation in the natural gas sector wouldnt hurt either.....I can put together a review if you like..I will call it "WITH SOME BALANCE WE ALL WIN".....thank you for your time...... [Information Removed]
RRE3353 I dont think the Govt needs to up the royalties that oil companies pay,the economic spin off from the work that goes on in the oil patch actually goes into peoples own pockets,I believe any more money that goes to the Govt from royalties will just get " [expletive]" away !
RRE3354 If you up royalties. The government will lose revenue on personal taxes. Hopefully if you put royalties up Albertans will put in a new government. I do know that you've lost votes in my household. Hope to see you on the unemployment line Ed.
RRE3355 Premier Stelmach--do not accept Big Oil's whining. Rate of development is too fast, & infrastructure is lagging to the point of critical. It is incumbent on you & your government to listen to Albertans. I have read the pros & cons, & the sense I have is that we Albertans agree that a slow down is NOT a bad thing. Housing, medical care, education, infrastructure, & promotion of other industries in Alberta must not be sacrificed to the oil companies whose real stake in our province is profit, not the long-term needs of the citizens. Better a slow down & a return to a more balanced growth. As it stands, most of the oil extracted is shipped to the US for refining. This, too, is wrong, & must be addressed! Thank you. [Information Removed]
RRE3356 Hello there: Here are my thoughts on the current royalty debate: 1. A lift of some sort is in order. 2. The royalty collection should consist of a mechanism that will float with the price of oil. This means that the lower oil pricing means a lower royalty collected, and higher oil pricing means a higher royalty collected. This ensures that Albertans and oil companies share the good times and that the oil companies don't pay a premium for doing business in Alberta when oil prices are lower. 3. Seeing a list of current royalty percentages, as published in the Edmonton Journal last week, the current royalty level being collected was one of the lowest, if not the lowest royalty collected in North America. The proposed 20 percent lift would make us on of the highest if not the highest royalty collected in North America. It doesn't take an economist to see that the incentive to do business in Alberta will not be great, and that while we might not see all the threats being put forward by the oil companies to pull business come to fruition, we will none-the-less see money being shifted out of the province. This means that while our share of the pie will be bigger, the pie becomes smaller. I think we need to increase the royalties collected, we must also ensure that we don't do it in an irresponsible manner that will affect jobs and our wonderful economy. A lift of 7 to10 percent at the most with a float of up to 20 percent if oil hits $100 a barrel might be amenable to both the oil companies and Albertans and would allow the govenrment to save face and avoid political back lash. Thank you for allowing the input. [Information Removed] Edmonton
RRE3357 I am an engineer with a junior oil and gas company that will significantly be effected by the proposed changes to the royalty structure. Our typical drill, complete, equip and tie in costs per well are in the $4 mm to $5 mm range. Our finding and development costs are approximately $20/bbl and the risk associated with the types of plays we are chasing is in the 50% to 65% chance of success range. Given these costs and the risk we must take, we can barely make a 10% rate of return at the current royalty structure. If the royalty structure is changed as proposed, we will not be able to generate any return at all, so we will not be able to economically justify any of the projects that we are currently pursuing. Our shareholders will not continue to put money into an investment that will not generate a decent return and we will not be able to attract new capital if we can not generate a decent return. Given the inherant risk of exploring and developing oil and gas reserves, investors are expecting to get at least a 20% return on their investment. Currently we struggle to meet this criteria and will certainly not be able to generate any rate of return at all with the added burden of increased royalties. Our company recently has an independent engineering evaluation firm conduct a review of our company value taking into account the proposed new royalty structure. The result of this review determined that the value of our company will be cut in half. This will result in our share price being cut to half of what it currently is. Current shareholders have already started to sell their shares looking for a better investment resulting in the share price dropping by 25% in the last couple of weeks. This coupled with the potential to not be able to generate any return on capital employed, will result in not being able to attract any capital in the future. The oil and gas industry is a very capital intensive industry that relies on attracting capital to grow. Without this capital, growth will grind to a halt and development will cease. Without development, current production will continue to rapidly decline at 30% per year or more. Declining royalty revenue will soon offset any gains made by the increase in royalties as proposed. The bottomline is the oil and gas industry cannot withstand the proposed additional burden of the increased royalties. Most if not all projects and wells currently being proposed by the vast majority of producers in Alberta will be uneconomic so will not be pursued. As a result, several companies will not be able to stay in business, development will cease and the economy could potentially take a downturn as significant as the phenominal growth we have seen in the past few years. We walk a tight rope between profits and losses in this industry and a minor change in the royalty structure could push most, if not all, producers in Alberta into significant losses.
RRE3358 It's time that Alberta did the right thing for its citizens rather than for the oil and gas companies. Raising interest rates is not going to drive business away -- where would they go? The rest of the world is already ahead of us on this. I support an increase in royalties; my vote will reflect your action on this at the next election.
RRE3359 I believe that Royalty Review is a part of what government's have to do to ensure responsible resource development. I also believe that government must offer a stable environment for business development. In the case of the Royalty Review Report, I believe that the Panel was working from inaccurate information and has reached some dangerous conclusions as a result. I am concerned that the Alberta Government will not consider the short and long term impacts of this move on conventional and unconventional oil and gas development in Alberta and the fuel this development has provided for the AB economy.
RRE3360 Please be advised that I'm an independent businessman who has been making investments in the Oil and Gas Business in the province of Alberta and formerly in the United States for over 25 years. The current proposed change in the royalty regime will adversely affect my current and future investments in Alberta and will force me to re-direct that investment outside of Alberta. The oil and gas business is a risky investment that requires large capital to remain in business. The proposed changes in the royalty structure coupled with the negative impact of low gas prices, high exchange rates and high operating costs will make investing in Alberta impossible to continue due to economics. The capital invested in Alberta has created jobs throughout Alberta including jobs outside the oil and gas sector. I believe Alberta will stand to lose considerable revenue from lease bonus consideration on OIl and Gas Leases, revenue for production royalty and considerable jobs should the royalty issue be approved. I question if this is what the people of Alberta want and I don't believe that under this proposed royalty regime that the residents of Alberta will be getting their fair share of the natural resources.
RRE3361 If the government chooses to implement the proposed changes to the Royalty regime it will have a profound negative impact on Alberta's economy. The issue of capital expenditures and overall activity levels (for gas) in the industry seems to be totally by-passed in the report. Centers like Grande Prairie have already felt a significant economic impact associated with a curtailment of drilling activity due to lower gas prices. Layering on additional burdens in the form of higher royalties and the elimination of the Deep Gas Royalty Holiday will simply eliminate all possibilities for drilling economic wells in today's pricing environment. This WILL have significant follow-on impact to all Albertans in that they may get a "bigger piece of the pie" but the size of that pie will be so much smaller that it will result in a negative economic impact for everyone.
RRE3362 please don't change anything. Just be wise in how to allocate public funds.
RRE3363 Just concerned what the maximum royalty review might do to our booming province. If the oil and gas sector slows down activity as a reprocussion to higher royalties? What happens to our booming cities and towns? Edmonton, Red Deer, Calgary, Medicine Hat, etc. I don't think its the farmers keeping all these people employed. Just the general slow down this year has affected a lot of pipeliners and well completion personal, hate to think what really putting the brakes on would do. [Information Removed]
RRE3364 Here we sit in Alberta. The strongest economic province in Canada. I am a born and raised Albertan who has been a part of the ups and downs of the oilpatch. I am a professional schooled by the world. I have travelled to many other countries and chose Alberta as it has the most stable environment for Raising a family. What gives anyone the right to change the rules without industry input. I am hearing the Royalty review commitee say lets raise royalties. Do they even understand the economic impact. We are seeing a 30% decrease in oilpatch activity due to new environmental laws, safety regulations and high inflationary pressures. Can the oilpatch take another hit. Lets take a look at Forestry. Crushed by improper Gov't management. Car manufacturing crushed by Unions. Will the Oilpatch be crushed by over taxation? I had to work overseas in the 90's to ensure a stable income to raise a family. I don't want to have to do that again. Please take an active look at the infrastructure and associations required to maintain a booming industry. We as a province cannot afford to lose the upside of this industry. I hear us being compared to Countries that are known for their poverty, corruption and socialist regimes. We are a country that looks socio-capitalist. The entrepeneur can do well but anyone can survive. I have been in coutries where your political associations dictated the type of lifestyle you had, does canada want to go this way. My home is the place trying to put me out of business. We went to privatisation because one person realised taxation is what a gov't gains its income from. Governments need to stay out of the business of running a business. Albertan's recieve their fair share according to the evidence of surplus budgets. Why destroy what is working to our benefit
RRE3365 I am tired of the oil companies holding a gun to the the heads of the citizens of Alberta. They have to pay their fair share for the resources they use to make them rich. Now they are threatening to leave Alberta should they have to pay more. My question is, where are they going to go? They are in the oil business so they have to go where there is oil. Let them go to Iraq? And when they go elsewhere where are they going to find employees??? I say let them go. There will be another who will take their place. Yesterday the oil patch workers had a rally at the Legislature. I would be willing to bet that they were put up to that by their employers and that they were likely paid for it too. It's time for the Government of Alberta to take control of the resources owned by this province and make sure that we get our fair share of the income they generate. Thank you.
RRE3366 Thank you for the opportunity to comment on the recent royalty reviw report. I am amazed at the depth of contoversy this report has created and the widespread support for it's recommendations. Albertans have apparently not appreciated the unsung work done all over the province to create a world class place to live. Through over 50 years of steadfast work the industry has laid down a firm foundation for most of the other industry in Alberta to fluorish. I think that the royalty review report has failed to account for many of the additional benefits the industry has brought to the province. Also, there have been many recent changes to the landscape that have made it more difficult to earn a profit in our province. Increasing cost of development with lower production rate and higher risk of productivity due to the unconventional nature of the resources have all contributed to an already reduced confidence od profitability. The exploitation of uncopnventional resources that are capitally intensive require a stable investment climate. I urge the government to reject this report's recommendations and return its attention to the role of determing how to best invest the returns received to improve the lives of the constituents. Thanks [Information Removed]
RRE3367 you will help me to retire soon but I will help you to retire next election.
RRE3368 I don't agree with the royalty review report. Costs are a major factor. Oil companies cannot just raise the oil or gas price to pass along cost increases. World markets set the oil price and gas is traded based on North Amercian market prices. Also, heavy amounts of capital is incurred before a drop of oil is produced out of the oil sands. Costs need to be recovered before a reason amount of royalty tax can be paid. It's ironic that the Alberta Government will create it's own home grown NEP program that will shut down the Alberta economy. You can be guranteed that many Albertans will never vote for the Conservatives' ever again if this goes through. signed - Concerned citizen of Alberta
RRE3369 I realize that Alberta's current economic growth is driven by oil and gas revenues, but I have three concerns: 1. the royalties received by the province seem more what companies are willing to pay, rather than what other countries receive, especially when one considers the revenues received by Norway, for example, with its North Sea reserves; 2. increased royalties to the province would increase dramatically the monies deposited into the Heritage Trust Fund and provincial coffers so Alberta truly becomes "debt free"; and 3. the rapid growth triggered by high oil prices has casued a disparity among Albertans who "have" and those who "have not." Increased funds received by the province would support development of infrastructure in Alberta and the provision of adequate social support at the same time as encouraging economic development. I worry that the large-scale development of Alberta's oil and gas resources creates too many starins on our families and "social fabric" and contributes to escalating pollution and destruction of ecosystems and habitat. Stop oil production? No. Increase fees received by the province? Yes - dramatically. Control pollution? Yes. And address the needs of groups adversely affected by natural resource development (like the Lubicons)? Absoulutely. As a province we are really no more honourable than the way we treat the most disadvantaged of our citizens - not the way we respond to the demands of wealthy development concerns.
RRE3370 I have read numerous articles regarding the different structures used to obtain revenue from the Alberta tar sands. Frankly I do not know enough about the business to give any advice to anyone as to which process is the fairest to all parties. I can only say that I feel that a fair and reasonable balance for both the citizens and the oil companies is imperative. I am confident that the Premier his Ministers and their advisers are in a much better position to choose a fair and equitable solution. I certainly do not envy them, it is easy to stand on the sideline and give advice it is a lot different when the buck stops at your desk. My thoughts and prayers go out to all of you. Respectfully [Information Removed]
RRE3371 While Mr. Stelmach may be convinced it's fair to seek a middle ground between the panel's over-the-top recommendations and industry's views, the middle may land too far from what the private sector can afford to pay.
RRE3372 Please, for the sake of all future Albertans, raise the oil royalty to at lest the minimum recommended by the Royalty Review Panel. Do not believe a word the oil companies say about a raise in royalty rates affecting future development. They need our oil and will say anything to get it as cheap as possible. The future of our children is at stake here.
RRE3373 My message is simple, I just can't understand why a government that is suppose to be for the people would even consider an option that will put thousands out of work. My husband and I both work in the oil and gas industry and our careers are now in jeopardy until this government makes a decision on our future. How this has even happened is beyond me, have you not reviewed the past and learned from it? The fact that you are even considering this increase to royalities tells me that you have not done the research. If this happens we will be forced to leave our home for the past 20 years and find another province more willing to allow and encourage their citizens to work and be happy.
RRE3374 I live west of Water Valley [Information Removed] . A large gas field in this area and 7000 loads of logs will go by our home this coming year, re pine beatle. the road west of our place is a disgrace. The govt. needs the new royalty to build the infrastructure. I am a share holder of [Information Removed] . They act like they will foot the 2B. propsal. In 2006 the net income for [Information Removed] was 6.4B in as safe a place as the CO , [Information Removed] will ever find. The people in this community are behind you100%. [Information Removed]
RRE3375 Madam/ Sir, As a born & raised Albertan that has spent +25 years of my career working in the oil & gas industry & as the owner of an oil & gas services company in Alberta, I know first hand the industry & the manner in which many Albertans & many Canadians would be affected by an increase in royalty rates to oil & gas companies. We Albertans have enjoyed prosperity on a scale beyond the perception of many individuals of lesser developed countries & much of this has been the direct result of the Alberta Heritage Trust Fund & its' investement growth, both the direct result of 'contributions' by Canadian oil & gas companies via the current royalty scheme. Simple thought & analysis of the industry & its' willingness to pursue the search for viable oil & gas reserves, shows them searching the world over for projects to invest their money in. It would not take much to have those investment dollars 'chased' elsewhere, possibly even out of Canada. I have seen many ups & downs in the industry in Canada over the last 25 years, but we are now pursuing depleting petroleum reserves in this country. Passing on increased Royalty charges to oil & gas operators in Alberta produces only one result; an increase in the price of oil & gas 'by-product' goods: plastics, paints, consumables, gasoline at the pump, oil at the refinery, etc. All transferred directly back to the consumer & the tax payer; the Canadian general public. I DO NOT support an increased royalty regime, above the current structured program & I believe whole-heartedly, as an Albertan, an oil & gas industry worker, an oil & gas service business owner & as a Canadian tax payer, that to change the current royalty & taxation system in place, would be tantemount to a 'death sentence' to the oil & gas industry in this country. Thank you, [Information Removed]
RRE3376 I urge the Alberta Government not to consider raising the royalties from the oil companies. I have 2 sons working in the oil field business and if royalities are raised I am afraid they will be without jobs. The oil company they work for has already slowed due to the uncertainty of this. Not only will this effect the people who work directly for the oil companies (and there are a lot of them) but it will greatly impact all other business's in Alberta due to the drickle down effect. Please consider this carefully. Thanks [Information Removed]
RRE3377 I am curious as to why you would go after an increase now when the oil patch activity has slowed down instead of when it was flat out? Drilling is down because the oil companies are [expletive] off because services overcharged when it was busy and got away with it. So the oil companies put projects on hold and said " lower your rates or starve". Natural gas prices are down so that has stopped alot of drilling also. To me this seems like asking for a raise when lay off notices are being handed out. NOT VERY SMART. Remember Alberta's whole economy revolves around the oil patch and this WILL HAVE A HUGE NEGATIVE IMPACT ON EVERYONE IN ALBERTA. Timing is everything and this is BAD TIMING. If this would have been proposed when things started to get busy and drilling activity and gas prices were up you might have had a better chance. Why you would bring this up now? I do not understand unless Mr. Stelmach wants to go back to being a farmer and does'nt care about the rest of the people of Alberta. Fair share for who??? Seems to me Albertans were doing pretty good until this Royalty Debate came up. I am in the oilfield industry and I am directly influenced by this ALLREADY and I do not work for the oil companies. I also think your report is not totally accurate. I am not saying the oil companies should not be paying more but, YOU really should have taken a good long look at was happening in the industry before you opened this bag of snakes which is gonna bite YOU and EVERYONE in Alberta in the [expletive]. I am sure Saskatchewan and BC will be very thankful which is where myself and many more Albertans will have to move to support our families and stay employed in the oilfield industry. If I was you I would maybe focus on the oilsands because they can't take their work to Saskatchewan and BC but, the oil companies can and will. The oil companies agree that their should be an increase but, how much? You want 20% they offer 10% settle at 12.5 - 15% and keep the work here with a promisary agreement and royalty reviews annually. Does anyone rember the NEP ( National Energy Program ) and what it did to Alberta? Those who ignore history are condemned to repeat it. I normally would'nt take the time nor have the time to write this but, things are slow right now and I can't understand WHY would you do this NOW??? There is 237 rigs drilling in Alberta with 470 down what does this tell you? 1 in 6 Albertans is employed in the oilfield industry what effect is this gonna have on unemployment and welfare statistics? And where is this fair share money gonna go? Why not a reduction at the pumps which would benefit most Albertans? I realize some people think oilfield workers are overpaid and this has increased operation and production costs but, we work in all types of weather under adverse conditions and don't see our families for weeks or more at a time and that is the trade off. I wish you luck with your decision and possibly your new job.
RRE3378 FIRST THE FEDERAL GOVERNMENT WITH THE INCOME TRUST FIASCO AND NOW THW ALBERTA GOVERNMENT CONSIDERING RAISING ROYALTIES ,LEADS ME TO LOOK ELSEWHERE (THAN OILSANDS) TO INVEST MY HARD EARNED MONEY.
RRE3379 I really dont think it ios a good idea to anger the oil companies in a bid to gain more money for our province. If you consider a few things first it might be a good thing to reconsider this course of action. First off we have an overabundance of jobs in this province and the ONLY reason that we do is because these oil companies have given Albertans the chance to develop the natural resources. What happens when they pull out? We chance of the good old ripple effect happening. Look at the Rig activity reports for this month alone after this all started and then look at last year same time and the year before. This has happened by just mentioning it .....what happens if you actually do it. I will tell you. I dont have work along with thousands of other Albertans, I pay a lot of tax, I am able to buy a lot of taxable items simply because I have this job, you actually stand to lose all of that revenue not just from me but also from the countless thousands this will effect. I really hope that this issue is resolved very soon everyone is scared and for what .......take my ralph bucks that I dont get anymore and drop this issue so we can all sleep well at night knowing we all still have jobs. I dont want to see these sleeping giants flex their muscles because when they do it will be a mistake we all regret.
RRE3380 I think the government should increase the royalties. I am tired of these millionaire CEO's whining about making a little less money and then threatening to pull out. This province is overwhelmed with work right now. A slow down is what we NEED. In Edmonton, no one bid on a stretch of pavement that needed to be repaved on the Whitemud. Why? No contractors could get people to work the night shift. They didn't even bother sending in a high bid. Also in Edmonton, the overpass at 23rd avenue would have cost $70M three years ago. This year it got priced at over $250M for the same overpass. Can nobody see that this is insane!? The boom isn't helping the average Albertan. It's helping a few Albertans become multi millionaires. It is also helping people from the rest of the provinces and other countries as they move here because there isn't enough laborers or professionals. So the average Albertan has to put up with increased congestion, reduced service, longer wait times for everything, for modest increase in wages and salaries. It is not worth it! Also they should increase the 1% startup royalty to something reasonable like 10% or 15%. Why do we need to give away our resources as fast as possible. As the world runs out of oil, this scarce commodity becomes a more and more valuable resource. I don't understand why we have to drill and mine as fast we possibly can - especially when you consider that the provine is crumbling under the weight of all the new development. What is the hurry? Finally, does no one in the Government even care about the ecology near Fort McMurray? Let's be honest with ourselves as to what is actually going on up there. It truly seems that we are worshipping the almighty dollar at the expense of everything else in this province. Regards [Information Removed]
RRE3381 Why would you even discuss this in a time when we have just been hit with the income trust bomb, a surging dollar, and multi-year lows on natural gas stocks along with weak NG prices. You should do this when stocks are at their highs and NG prices have recovered. Take RRZ it is now in the $4 dollar range down from a high of over $20. As an Albertan I invest in Alberta. Now with government interference you are damaging my investments. With your multibillion surpluses you are now getting greedy. This has been a big mistake for the PC party. [Information Removed]
RRE3382 Amazing! If Ed and his government does not take action to represent the people of this province and thier interests, he will not get my vote. What an absolute abdication of fiducarey duty! If management fo an oil company represented shareholders as badly, they would be fired and sued. Come on Ed, kick the Minister out fo cabinet. You must remember you govern for the people of Alberta, not just the oil companies. How you respond, will be a big decision in my vote
RRE3383 I own a small construction company that employs 150 people, and we are all against adding more royalties to the oil and gas producers. If Encana and and many other gas and oil producers pull their money out of alberta, it will ultimatly mean there will be less jobs available for everyone including all the people who do not directly work for an oil company, such as restraunts, hotels, gas stations, home builders, vehicle dealerships, the list goes on forever. The oil and gas industry has made Alberta what it is today DO NOT DESTROY THE HAND THAT FEEDS YOU!!!!!!!!!!
RRE3384 I am concerned about the government taking more royalties from oil and gas companys. I work in the oil patch and my boss has told me that if this goes through that we will have no work. [Information Removed] has already told my boss that they will not contract any of our rigs until the outcome of this cituation. [Information Removed] has told us that if it goes through they will shut everthing down. If this happens, myself and many other people will be out of a job. This will not just Effect people in the oil patch, but also truck dealerships, welding shops, mechanic shops, gas stations, restaurants, and all other retail buisnesses. If service companys have no work for there equipment they will also not spend money on repairs, tools, safety equipment, and aditional products they may use. Also if this happens what will happen when a vast amount of people go on unemployment. If the oil companys shut everything down,they still make money, the government still makes money, because oil and gas still keeps flowing, but all the services are shut down. Will the government care when people start loosing there houses because they cannot make there payments, or will the government take care of it for everyone since they are makeing so much extra money from royalties.
RRE3385 I currently work for a large oil & gas company in Alberta and share great concerns of this tax implamentation. This would not only affect the oil patch, but the entire economy of Alberta. Everyone is taking such advantage of the boom we are in, that is would result in loss of property for several Albertans. Businesses would suffer, the death toll will rise and our province would no longer be "debt free". I believe it is in the best interest of the citizens of Alberta to throw out this review.
RRE3386 Having read the royalty report, I feel it is this government duty to follow the report recommendations fully. The royalty review taken at face value is in my opinion generous to the Oil companies as even with the increase we are far more reasonable then places like Norway, or any other jurisdiction in Canada
RRE3387 Alberta has to be careful that it doesn't get it's hand stuck in the cookie jar. Anticipated windfall revenues based on theoretical assumptions must be tempered with the reality that operating costs for the oil and gas industry have increased significantly, the dollar is overtaking the U.S. dollar in which prices are measured and activity is declining as the basin becomes more mature. If the government attempts to take too much the anticipated extra revenues may be offset by the decline in income taxes as layoffs begin.
RRE3388 DO NOT INCREASE ROYALTY RATES!!!!!!
RRE3389 I have been reading the news about the Alberta Royalty Review and I think that the current direction the government of Alberta has taken will considerably reduce the investment in the province and lead to a substantial loss of jobs. I base my opinion on the fact that most of the oil industry costs are driven by the global market (oil prices, inflation, technology, and environmental issues) and the board is basing their conclusions on wrong comparisons, not considering the high cost of production and the rapid decline of reserves in Alberta. The same approach on other countries has failed once the oil companies find out that their profit margins are reduced by what the government considers “reasonable” royalties. They just close their operations and leave to other places with more controlled risk but higher profit margins. As an example you can search on the Internet about the reason why companies like [Information Removed] closed operations in Venezuela this year (reasonable royalties). At this moment I’m very worried because I think the government has taken a decision that will impact most of the people in Calgary. I think both parties should look for a win-win situation. Not "my way or the highway". My family depends on the oil industry, just like most of the families here. That is way I am asking your help. To let them hear our voices. Thanks, [Information Removed]
RRE3390 I fully agree with the royalty review report and want to see it adopted. This is a great opportunity for government to be seen as truly representing the interests of Albertans and perhaps more funds can be made available for infrastructure such as transportation and affordable housing......Thankyou...[Information Removed]
RRE3391 I think the Royalty review wasa good one, and that the government should adopt its recommendations as submitted. There will be a hue and cry from big oil, but we need to remember that they have had record profits for each successive year in the past 6 or 7 years at least. So they got away with it for a number of years, now is the time to give the owners of these resources a fair return for this non-renewable resource. It would appear big oil will threaten decreased investment etc. I hope this is the case, so our society can regain a semblance of normalcy. Slowing down our runaway economy would do wonders for the housing crisis, the labour crisis, the infrastructure crisis, the financial crisis in building schools, recreation facilities, highway interchanges, hospitals, etc where publicly funded bodies cannot budget for projects because of escalating costs. Stick to the report Mr. Stelmach!
RRE3392 Seems to me the Gov't should consider developing unique Royalty Rates per commodity types. It does not make sense from a Jr. Natural Gas Company's perspective to pay the same royalty rates as a Company in Oilsands or Petroleum as Natural Gas is far more volatile in my opinion. Why not develop a commodity tiered Royalty system to reflect the profitability variances between the commodity types as it might take the pressure off of the Natural Gas critics of the report, and keep Natural Gas exploration & development in this province alive. Sincerely, [Information Removed]
RRE3393 My request is that you fully consider the input of the oil and gas companies as they provide their comments on the suggested royalty changes. It is a complicated issue and should be fully understood for both the immediate and long term implications of changes. Although I believe in the building of the Heritage Trust Fund (or something like it) that building cannot fully occur at the cost of huge damage to today's economy in Alberta. A balance between the short and long term should be sought.
RRE3394 I was initially suspicious of the make-up of the Royalty Review Panel but when it was announced that [Information Removed]would head the panel, my suspicion were much allayed. I know [Information Removed] to be a very successful business executive who was and is greatly respected by his employeees and his community. So, when a panel witha great deal of business representation issues such a Royalty Review Report I think its recomendations should be implemented. Period. The Panel consulted widely and fairly and its recomendation, when implemented will ensure that Albertans will finally start getting a fair return for the resouces that ALBERTANS own. Thank you for the opportunity to provide feedback on this important issue. Sincerely, [Information Removed]
RRE3395 I want to start by saying that I am opposed to the changes in the oil and gas royalty structure. The proposed increases will have a negative effect on the oil and gas industry, and several major production companies have already publicly announced that capital spending will be dramatically cut should the increase in royalty rates proceed. This will only equate to major job cuts in the oil and gas service industry and lowered materials orders. I have 2 sons who both work on drilling rigs, and I am a production foreman for a large oil and gas trust company. I know firsthand after [Information Removed]years of involvement in this industry that we will all collectively suffer, from the young person washing dishes in the restaurant to the maid cleaning hotel rooms. I do not wish to see these people lose their jobs due to the short sighted views of a few. Lets keep this province running on all cylinders and become the one place in North America that everyone wants to be a part of. Sincerely, [Information Removed]
RRE3396 Since only a small fraction of the economic benefits that Albertan's derives from energy sector is in the form of royalties, implementation of this shrink the "Alberta Pie". Rates of Return for energy projects hold an extrely high sensitivity to royalty rates. Budgets will be slashed in Alberta as corporations search for areas which provide their highest rate of retrun to their shareholders. Also, increasing the TAX on freehold minerals in unconscionable. These rights are owned by the descendents of Alberta's homesteaders and do not belong to the Alberta Crown. This results, in effect, a confiscation of Landowner rights in Alberta.
RRE3397 I have read the Royalty review report and feel the report is seriously flawed and should be reinitiated with input from technical experts within the industry. Too many bad assumptions were made which gives a bad conclusion. Pls do not inact anything from this study.
RRE3398 We are on the verge of a "Made-in-Alberta NEP". Even though public opinion polls of Albertans suggest that up to 80% of Albertans agree with the implementation of the Alberta Royalty Review Panel's (ARRP)recommendations, more than 20% of Albertans will be hurt by decreased oil and gas activity in this province. Everyone from cocktail waitresses to municipal grader operators rely on a strong oil and gas industry for their livelihood and acquired way of life. It is obvious from such polls that the general Alberta public is unaware of how much their daily lives are affected by a prosperous oil and gas industry. I believe that the Panel's recommendations are based on outdated and insufficient or overlooked data, and that an equitable "middle-ground" can be found if the correct assumptions are used in the Panel's analysis. We should revisit the assumptions used and review the Panel's recommendations. I ask the government to slow down and get it right. This industry in Alberta and Western Canada is already feeling the pain of decreased activity due to decreased competitive advantage with other jurisdictions worldwide, and implementation of the Panel's recommendations will surely be the death blow for Alberta. If we should have learned anything at all from the NEP days, it is that short term gain can in no way compensate for the long term pain that will befall Alberta. Sincerely, [Information Removed]
RRE3399 Hi, I would just like to say that we shouldn't fold to the energy companies bluff about pulling out of Alberta. For too long we have undercharged royalties compared to other oil producing states and countries like Alaska and Norway. Alberta is a politically stable source of oil for the United States and the oil companies know it. Raising the royalties will only reduce the profits of the major oil companies by a few million. Thank-You
RRE3400 I support the Royalty Review Panel's recommendations. The petroleum industry will always find and follow any opportunities that return a profit, however marginal.
RRE3401 Honorable Ed Stelmach: Dear Sir: Being not a resident nor a citizen of either Canada or therefor Alberta, it is with a desire to not be intrusive upon issues uniquely relevant to Alberta that I write with my opinions upon the matter of the royalty review report. However, I am an investor in two of the corporations presently developing oil sands projects. One project imminnent ly to go into production and the other within the next four years. It is with this interest that I write to you. As I feel it is not my place to meddle in affairs uniquely germane to Albertans, I was at first reluctant to communicate with you. However, upon reflection there were a few issues I felt were important enough to raise. My principal concern is that with whatever decison is made, the long term interest of all parties at interest need to be considered. Though under present circumstances, it may be difficult to envison a scenario where oil prices are constrained, one must take such an eventuality into consideration. Under such a scenario it would be a shame to see the Alberta Oil Sands Industry limited by having to deal with a high cost process as well as high royaltys. It would therefore be my suggestion that it may be appropriate to develop a " sliding scale " approach wherein royaltys increase in accord with a relevant bench mark crude oil price as determined by the market place. This for instance could be Brent North Sea Crude price or West Texas Intermediate price. The last thing which should be desired by the people of or the Government of Alberta, is a situation wherein Oil Sands production becomes uneconomic due to market place factors. Such would not serve the interest of Alberta or the market place. Thank you for permitting me to express my concerns in which we all, regardless of where we come from have an active and abiding interest. Sincerely, [Information Removed]
RRE3402 Even with just the thought of the idea of raising royalties has given a ripple effect in most businesses in Alberta, I board horses while my husband works in oil field, not only are we concerned about his job, and not spending ANY money other than necessities, but the people that pay me to keep care of their horses, are probably going to sell them. [Information Removed]. When is this going to end. The Alberta economy can not handle the raise of royalties. Alberta did very well with out the raise in royalties for years, why the change? Is it greed? Politics? Let the Albertans know, and know the TRUTH.
RRE3403 Stand up to Big Oil: adopt the RRP report in its entirety.
RRE3404 To whom it may concern, My husband and I relocated to Red Deer, Alberta under a year ago when employment opportunity arose for him at an oilfield service company. We have finally bought our house and just found out that we will have a new addition to our family in May 2008. Any security in the life that we have established for ourselves rests on the Alberta oilfield. This fact is terrifying to me because it seems that all oil production is coming to a halt as a result of the recent royalty review. I honesty believe that this royalty review is a huge mistake and that it will take away everything that makes Alberta such a wonderful place to live. I have always trusted that our government would take care of us Albertans and make choices based on what would be best for all citizens. As a result of this review, I have major doubts on that trust. Please advise me any positive aspects which would arise if these decisions are implemented as I only see negative results arising from the same. Further and most importantly, PLEASE make the right choices to ensure that all of us Albertans are still secure in our homes, jobs, etc. Thank you, [Information Removed]
RRE3405 The reported outcome is a welcome start to an ever longing injustice to all Albertans. I applaud the courage to stand up and demand an increased return on OUR resources. However, i'm dissapointed that the recommended increase wasn't more. I feel that it should still be even higher or laddered up over several years to reach parity with other areas. As i said, its a good start, but with no mechanisms proposed to continually adjust its contribution, won't we be revisiting this program again in the next 10 years ? The one penny on the dollar has to go.
RRE3406 With the current low natural gas pricing, the production companies are not making a lot of money due to high labour and other high production cost. Why would the Government introduce higher royalty at this time. It will force large production companies to cut production budget which would have direct impact on the Alberta economy. Project cut will mean job loss, loss of expertize, reduction in consumers' spending..etc. With the high cost of living in Calgary, who can afford a salary cut or a layoff? Please look at the issue closely
RRE3407 In regards to the Royalty review I think the recommendations are reasonable and sound. The people of Alberta are the owners of these resources, not the big energy corporations. I think these corporations tend to forget that fact and behave as if everyone in Alberta works for them (only a small percentage of Albertans work directly for these companies, many are in support industries but a lot more are not directly dependent on the "energy chain"). I would suggests a phased approach to the implementation of these recommendations so that markets can get acclimated to the changes and it won't hit the corporate pocketbooks in one large shock. A further comment: The EnCana "threat" to pull a billion dollars in investment in Alberta should NOT be taken seriously. I've known people who worked for EnCana and it's a corporation I grew to know and dislike from all the things I heard about it, a corporate bully who thinks it can bluster and threaten the province into doing what it wants in the name of "shareholder" value. I hope EnCana carries out its threat, then someone else will come in and drill the gas they left in the ground and make them out to be a laughing stock. As one economist put it "where in the world is EnCana going to go which is as safe and secure? Russia? Venezuela?" EnCana is very shy and conservative about taking any risks which is why they got rid of their International exploration program and assets, if they go to the US, costs will be even higher! So this comment from them sounds like one of desperation as they think their "free ride" is over. This "threat" they are making will backfire on them in the court of public opinion because a lot of people are already wary of the huge profits companies such as EnCana have made in the past 5 years. Frankly a lot of people are tired of hearing about filthy rich energy companies and shareholders benefiting from this boom when many people in this province are barely keeping up with the rising cost of living here in Alberta. My own forecast is that we are not going back into a bust cycle in the energy industry (as much as they would like to scare us into believing), not with the Chinese and Asian economies needing ever increasing amounts of natural resources not to mention the American need for secure energy supplies. The people of Alberta deserve to have the benefits of these resources and here in Calgary and around the province we really do need to increase funding for our infrastructure and institutions, more and better health care and education is an investment in the future we cannot ignore. Our children should not have to leave this province to get health care or better schooling, not with the resources we have and we(the citizens) should be getting a fair share of what is produced and sold.
RRE3408 Why kill the goose that lays the golden egg? Why drive Industry leaders away from the Province Take a look at what happened in Newfoundland. Learn from their mistakes! Think of the consequences. Besides the E&P industry, what attracts corporations and people to Alberta?
RRE3409 I strongly disagree with the Review Panel's recommendations and oppose any increase to the Royalties currently being paid by oil and gas companies. This will be extremely destructive to the Alberta economy as the lower revenues to oil & gas producers will trickle down to service companies, there will be a slowdown in prodution, jobs will be lost, reduction in consumer spending across the board, etc.
RRE3410 Good Morning, Upon reading the consequences of these royalties upon our company and the realization that a good third of our companies [Information Removed] developmental budget would go outside of Alberta should the report be adopted in full I am very concerned. We have enjoyed many financial benefits in the past years due to the strong Oil and Gas sector. The adoption of the report would severely impact these benefits in the long term as projects are downsized and even cancelled due to their now lack of cost effectiveness. The effect would mean less job creation in rural Alberta as well as community support for areas where Oil & gas contribute to the local economy. It is my belief that royalties should be revised but in a way that promote financial growth in Alberta, not in one that will have short term benefits for the province and long term drawbacks. My suggestion is that the government cosult with leading industry companies to develop financially viable avenues to increase royalties. Thank you for your willingness to support the communities views, I will also be contacting my MLA with regards to this issue.
RRE3411 I am a 54 year old single male. Iwas born in Calgary and have lived here all my life. For the last 10 years I have made my living working in the Oil & Gas Industry here in Alberta as a self-employed person working for several Canadian companies. These companies not only have operations here in Alberta but around the world. For the first five years I was involved with expediting material and equipment to countries in South America. If i lived in one of those countries I would be very much in favour of raising royalties and fees as high as possible because most of the equipment used to build those facilities was imported. And the majority of it was built or purchased right here in Alberta! Those couintries did not receive the spin off beneifit of a thriving manufacturing sector to support the oil business. If the companies working here in Alberta do decide to direct some of their efforts elsewhere, it would have a negative effect on alot of businesses and people right here in Alberta. When the thousands of fabrication shops and service and supply businesses are not busy, they don't employ people. And when people are not working or working less, they don't have the disposable income. I do think the people of Alberta should expect our government to get our fair share for us, but we must take into consideration the affect this has on the entire economy.
RRE3412 Do people think is only costs the oil companies $10.00 a barrel to produce oil/gas. They should get the true costs before they start demanding more monies in royalties. If the oil companies have to pay more in royalties they will shut down projects and then have to lay off people - and where will we be then. I have heard from friends that the oil companies have already put a hold on projects
RRE3413 While I understand the importance of achieving a balance that works for all Albertans as well as the oil and gas companies, I am sick and tired of the threatening rhetoric from industry that aims to place the fear of job loss in to anyone working in the sector. The companies are not doing themselves any favours by just lashing out at the Royalty Review Report without offering any viable alternatives. Oil and gas companies do not--and should not--run the province. They don't care about the long-term stability of the Alberta economy. They will take what they need and move on to the next stop. Hopefully the Alberta Government can reach a good middle-ground with these companies when it comes to the report's recommendations. The oil and gas companies need to pay their fair share for the provincial infrastructure they use everyday and the long-term environmental damage they inflict on our land and water. At the other end, the Province need to recognize the importance of maintaining a strong economy that relies heavily upon oil and gas. Premier Stelmach: Thank you for tackling this issue that was blatantly ignored by your predecessor.
RRE3414 Sirs, It is with great sadness that I heard my Premier on the news indicating that there will be adjustments made to the Royalty Review Report when it is implemented. I could be naive and believe that the Govt. will implement stronger measures than recommended, but I have a better chance of wining the lottery. I believe, as the Parkland Institute indicated in their just released review, which I have also read, that the report as presented was more than a fair compromise that industry should accept. Apparently not because my Premier was holding closed door meetings with industry as they barter for a better deal yet. Words cannot express my sadness and disappointment at Ed Stelmach's lack of backbone and leadership. I guess I have to shop my vote elsewhere come election time. Hopefully we can revisit this issue with a stronger statesman as our premier at a later date. In the meantime I get to watch American hedge funds continue to suck Alberta's revenue back down south. With great sadness, [Information Removed]
RRE3415 I think that the royalty review is allready outdated when you see that there is a royalty increase to producers effective September 1st 2007. The increase in royalties is due to the following amended regulations. AR 207/2006 - up to $500k increase in royalties by well AR 206/2006 - over $1m increase in royalties by well AR 205/2006 - unknown inpact These regulation changes should be taken into account before any other increases are made. I also believe operating cost increases and the value of the Canadian dollar versus the US dollar should also be a factor in any calculations of royalty rates. Operating costs are high, and oil and gas pricing is in US dollars. [Information Removed]
RRE3416 Dear Ed, please stick to your guns and follow through. Don't let the oil industry push you around. Thanks. [Information Removed]
RRE3417 Dear Sir I hope that the Government will not implement all the findings in the report per see without reverifying all the comments from other studies. The government should ensure that the findings in the report with regards to cost are accurate in addition to ensuring that it does not create a recession in the process of implementing the findings in the report. We need to balance the need for increase royalty payout against the loss of tax base if this result in loss of jobs in the industry including support industry. We are in a period of extreme growth and Alberta is the most economically progressive province in Canada and we should try to find a medium which is acceptable to all players affected by this report. Thank you [Information Removed]
RRE3418 As an Albertan, I am deeply concerned over the Royalty Review and its impact on our province and economy. Yes, I do work in this industry, have family and friends who work in others that will be effected by the downturn in our economy. I also realize that the "great impact and rippling effect of this Review (if put into place) will have on our province, lives of Albertans and the Canadian Economy too. There will be lives destroyed and homes lost, the greatest impact of this will be felt "socially" by the Gov. of Alberta in their employment, welfare, and social departments. I would say to Mr. Stelmach to not "slaughter" his province. As, this could very well be the end of a "viable" province. The government needs to listen to the energy industry and take their suggestions to review this much more carefully for our future. The Heritage Trust fund was established to give Albertan's a fair share. With the billions in the goverments coffer already, Just were did they think this came from? It is a sad day that after so much economic activity and viability, that this review will cause great detrement to many lives and our province, if the Royalty Review is put into place as it has been reported - without greater care to look at it much more closely with industry leaders. It's impact will be felt throughout much more than the Oil & Gas industry that we may never recover for quite some time; If at all, as the people who will be impacted will not have much trust towards our government. It has been tough enough to obtain workers throughout industries now in 2007, If this was to occur, people will leave the province (will have no choice) and thus in the future, will our youth of tomorrow want to study and choose a career in and industry that may not be stable in the future?
RRE3419 Hello, I am student at the University of Calgary and voicing my feedback on the royalty review report. I want to extend my support to an increase in base royalites of oil revenue to even greater than the proposed 33%. As stated by the Parkland Institute's analysis of the review, "there is a projected decline in government revenue from oil and gas of almost $4 billion dollars from 2006 to 2016: despite increased production, increased demand, and increased prices." This is unacceptable given the havoc such production is creating on our Canadian environment and quality of life! [Information Removed]
RRE3420 I was deeply concerned after reading the report from the royalty review panel. What I found the most concerning was the fact that a rise in royalties of the proposed magnitude may scare of the large amounts of capital required to get many oilsands projects off the ground. There are a number of smaller companies currently pursuing smaller in-situ projects which will still require several hundred million dollars each of capital. These companies do not currently have production large enough to generate the kinds of revenues to support these projects so they are forced to raise capital in the equity markets. Take for instance [Information Removed]who just this month commissioned their [Information Removed]project, this would not have been possible without raising several hundred million dollars of funds. Some of the more notable smaller Alberta Based companies which will require capital over the next few years for their projects include: [Information Removed]and several others. These projects are not the prime projects that we see from the likes of [Information Removed]etc., they are less robust projects and the proposed royalties may cause some of them to not be funded. By making it more challenging for these projects to get the money required you are opening the door for larger, multi-nationals to develop the projects. This is a shame as many Albertans are working very hard on these projects and are also investors in these projects. I believe that the royalty review panel has carried out both a superficial and incomplete assessment of a change in royalties. It is my belief, that they have identified the maximum rent available to the province; they have however lacked the wisdom and sophistication of what they have framed. The oil industry is a margin business both because of the maturity of the basin in the conventional business, but also the very nature of the oil sand business. When a margin business losses a material share of net revenue, in this case in excess of 20% there is a material shift upwards in the required commodity price for many of the projects to proceed. We have seen this in gas drilling in 2007 with 40% fewer gas wells and a decline in production of almost 1 billion cubic feet per day. The impact of the recommendations would be expected to include: 1. A decline in activity until commodity prices rise to support project development. 2. A compounded effect of that decline as the required investment capital is reduced in availability, increased in cost if raised and therefore further increasing the required commodity prices to advance projects. 3. Service sector companies through reduced activity will see the erosion of the volume and value of work and employment will decrease. The assumption of the report that activity does not change can be said to be superficial at best. Alberta’s GDP may be much less than it might have been and government revenue may in fact shrink as they garner a thicker slice, but of a smaller pie. Other key points would include: 1. The principle of ability to pay is distorted by the proposed oilsands severance tax. This is a gross tax where at current prices it is not the ~ 5% impact on the net to a company but potentially a 10-12% impact from monies available to a company as there is no deductibility in tax or other cost factors. The price triggers for the tax do not recognize that break even prices for many projects are above the threshold proposed. 2. The proposal shifts foreign exchange risk to companies. In other words government revenues would be insulated from changes in exchange rates this of course is at the expense of the company share. The severance tax in combination with the foreign exchange risk becomes regressive in lower commodity prices, i.e. it will make any slow down worse. 3. The bitumen price question has a potential to be a significant and serious wild card to the determent of companies and perhaps the province. There is clearly a transfer price question for integrated projects. This should be addressed; however a non-integrated project only receives what it can. If deemed prices calculated by a formula do not reflect market prices either the government or company will lose, clearly not an objective. This recommendation in particular is very problematic and not well understood, notwithstanding the recommendation made. The harsh criticism of the committee to others would be particularly well applied to this recommendation of their own. 4. Small companies will be under pressure. In a margin business scale is everything. [Information Removed]is both respected and despised for what it is in the retail margin business. In the oil business this will increase the pressure on being big to survive. The numerous small companies of the conventional, but more particularly the oil sands will be consolidated. The business will be more dominated by the multi-national and activity will be constrained. Feel free to contact me at [Information Removed] if you have any further questions. Regrads, [Information Removed]
RRE3421 It is about time that we get something more from the oil companies. We need the extra money for infrastructure. They are one of the main contributors to teh deterioration of our infrastructure, they should be the ones to help replace it. People who say this will discourage investment have either not read the report or do not understand business. It is nothing more than fear mongering.
RRE3422 The royalties must be adjusted to ensure that Albertan's are paid fairly for the resources. Much of the infrastructure debt in the province is a result of the activity of the resource based industries, so recouping a fair share of royalties will assist the province in continuing to upgrade highways etc. I urge the Premier not to cave in to the lobby that is taking place from [Information Removed]and other related groups, the resource belongs to Albertans. I agree with lowering the royalties on lower producing or older wells. Much of ndustry is on these older facilities.
RRE3423 The recommendations of the Review Panel fall far short of what should be done regarding changed royalties, for the sake of both fairness and balanced development of the province. The only reason not to go ahead with the full set of recommendations, would be to ask for the investigation of even greater changes. One would be the maintenance of the 1% regime until initial costs had been covered - quite out of date with current realities.
RRE3424 I have read the Royalty review Executive Summary and it has just confirmed my "gut feeling". I will confine my comments specifically to the Oil Sands sections of the report. As the report points out, the resource belongs to Albertans. During the time of the development of the oil sands, and at a time when oil prices were low - very low - these concessions made sense. The concessions did their job and the companies accessing these concessions have long since moved from fledgling almost research companies developing new technologies, to being very profitable. The holiday is over. They are now mainstream oil companies making more than fair return on their investment but still being subsidized as if they are fledgling [Information Removed] companies. I encourage you to implement the FULL recommendations of the report. Understanding that oil companies may need some time to react, I would suggest phasing in at half level in year one and full in year 2. There will be the fear-mongering by the oil industry but that, of course, is not unexpected. If you reduce their bottom line they will complain. I do not see any short term slowdown in economic development as serious enough to prevent us from ensuring that we are not "giving" away our non-renewable resources for the profit of the oil industry. I also strongly believe that we need to keep our bitumen in Alberta for processing. This allows us to leverage this resource both at the extraction and processing level. Thus we are gaining the most advantage from our resources. The "draw-ers-of-water" and "hew-ers-of-wood" are in big trouble when the wood and water are gone so leveraging these resources just makes sense. This also allows us to encourage the development of secondary industries to sustain our prosperity. On a political front (and I know Ed won't see this), Ed was perceived by many at the start of his term as a pretty laid-back kind o' guy - not a pit bull. I believe he has made some very estute moves in terms of the Energy Board and royalty review where he has the opportunity to show leadership. This would be achieved by acting aggressively on the Royalty Review - not like a pitbull - but more like a seeing eye dog - helping Albertans get to were we want to be. (Bad dog analogy.) I wish to express my appreciation for being asked to give my input on this important issue.
RRE3425 In all things moderation. I believe an increase is warranted. Should it be an increase that will chase away investment NO. Should it be fair to Albertans YES. If it had the side effect of slowing things down I suggest that most Albertans would support it. I also believe that it is time that corporate Calgary/Houston understands that they do not run this province so I support our premier in his dealings with them.
RRE3426 Implement all recommendations boldly. Big corporations will cry (false cry though), but they come after money every time. If there's money to be made then they will come and work. So don't worry. Just get the fair share of money.
RRE3427 With the rising cost of living in Alberta and the ever increasing energy prices it is only reasonable that the poeple who have to give up their hard earned money to stay warm get something in return. All services that the government tries to provide are all cut back to barest minimums the money should help the people of Alberta, and not American energy concerns and American profits
RRE3428 Incresing the Royalties in Alberta will only slow down Oil & Gas production activity and many Albertans will loose their jobs when the Oil & Gas companies decide to move else where and leave Alberta in the dust with our high Royalties. The economy will drop and everyone with high mortages and no jobs will have the Albetta government to thank.
RRE3429 I have reviewed the Royaly Review Panels recommendations and what the Auditor General Report contained and I have come to the conclusion that perhaps the Dept. of Energy should focus on a system to ensure the royalties we are collecting are correct I believe there are billions of dollars available for collection if the Department could effectively track gas volumes and allocate enough trained staff to this task. I do not believe raising royaly rates significantly will benefit Albertans. The costs for drilling are significant . I am a resident of Viking, Alberta and the drilling activity in this area has been very beneficial to all.
RRE3430 I believe that a change to the provincial royalty rates for conventional oil and gas is not warranted especially for gas. With gas pricing a low levels alot of gas must not be economic to produce and raising royalty rates will definitely cut off investment by oil and gas companies. This will hurt rural Albertans the most in the short term and all of Albertans longer term. I urge the government not to make changes to royalty rates at this time.
RRE3431 The Premier should accept the Royalty Review report and charge higher royalties from the oil industry. This is long past due. If action isn't taken now to receive more money from oil revenues I will have to rethink who I vote for in the next election.
RRE3432 I'VE ALREADY BEEN LAYED OFF THIS IS HARD ON THE OIL PATCH AND WILL COST THOUSANDS OF JOB LOSES IF YOU DO NOT FIND THE RIGHT BALANCE. [Information Removed]
RRE3433 full steam ahead with the review panels recommendations. enough with the oil company and investor tax-breaks...time to give Albertan's a break in taxes, housing costs, energy costs and general high cost of living
RRE3434 I was born and raised in Calgary. I practiced law in Calgary from 1981 until 1993, during which time roughly 50% of my professional time was taken up doing insolvency work - clearing away the debris left in the wake of monumentally foolhardy government policies directed, I think it is fair to say, at ensuring that "the people" got their "fair share" of oil and gas revenues. I watched as good citizens lost their jobs, their homes, their marriages, and their belief in a country they had loved. As time passed, of course, most of even the most ardent supporters of the N.E.P. came to concede that it had been an unmitigated disaster, not just for Alberta, but for the entire country. Since 1993, I have worked in various capacities in both the financial and oil and gas exploration communities. I am well-informed about the issues involved in the royalty discussion. I have read the panel's report carefully. No end would be served by my belaboring the many points that have been made in the public domain about the report's flaws, although I am compelled to comment that its blatantly partisan and incendiary tilt and its patent distortion of material facts are disgraceful. That said, I fully support the notion that a review of Alberta's royalty regime was long overdue. It is my experience, as a lawyer, an industry CFO, and a financial analyst, that the regime has evolved over the years into a virtually impenetrable thicket of complexity and contradiction. I believe streamlining the system by itself would generate a significant positive return to the government. I also believe that there is some room for the Crown's percentage take to be increased when commodity prices are strong, but only if such increase takes proper account of the real drivers of a business that has made our Province an envy of the world. I submit that the panel's recommendations fail abjectly to pass that test, most glaringly in their complete disregard for the key metric, namely return on capital. (The reliance on dated, selective, and inaccurate cost data also fails abjectly to meet any reasonable standard of intellectual honesty, but there's no need to highlight the obvious.) As a consequence, the recommendations relating in particular to the conventional segment of the industry are deeply misguided and would be extremely harmful. It is particularly perverse that the worst damage would be inflicted on the best conventional assets, namely high productivity wells. Finally, I am horrified that it is even up for discussion that Alberta should consider breaching contracts and retroactively changing the ground rules in respect of projects on which many billions of dollars have already been spent. That happens in the Third World. It must not happen here. Apart from considerations relating to respect for the rule of law, the negative ramifications on the cost of capital for all business in Alberta would be serious and long-lasting. For the sake of all Albertans, let us not implement an overly and needlessly aggressive resource revenue policy. With the N.E.P., we could at least blame others. It would be even more unforgivable were we to do it to ourselves.
RRE3435 I believe that ED and the boys are committing political suicide, who do they hope to impress, the rural voters already back the PC......
RRE3436 I work in the oil and gas industry and paid fairly well. I can see why Albertans working in other sectors might feel that they are not getting their fair share. There are a couple of strategies the government SHOULD consider; 1.Gas production, gas drilling and conventional oil production are decreasing in Alberta. Increasing royalties will accelerate these declines. Companies driliing high impact wells assume higher risk. Higher commodity prices combined with the current royalty structure allows companies to explore these targets. Look at the bottom line of all the E&P companies...many are rather unhealthy. 2. Increase oil sands royalties...modestly! Review the cost of the projects and determine a reasonable royalty rate. WE can all benifit from this great Alberta resource. If royalties are increased too much, the economic limit of SAGD wells will be reached faster....leading to more oil bitumen left behind. This is a conservation risk!! 3. MOST INPORTANTLY, lower taxes for low income familes, leaving or even increasing taxes for higher income families or oil companies. Really, I'm proabably not going to lose sleep from an extra 1000$ in taxes. The disparity between high and low wage earners is growing. Nobody in Alberta should be left behind. 4. Eliminate and never ever consider the Ralph Bucks again. Wealthy individuals need 400$ like they need a new pair of shoes. I'm certain shoe sales jumped after the rebate :) Thanks very much.... PS. We CAN make everyone happy. Lower taxes for low income families, increase royalties on oil sands production, and reinvest Alberta's tax $ inteligently (no Ralph Bucks).
RRE3437 The assumtions of the royalty review are clearly flawed by ignoring the value of landsales to the contribution from the industry. The Finding and Development costs for Alberta's oil and gas are extemely high due to either the marginal size being discovered with each well or the cost to access the product. Comparisons to places like Norway are ridiculous considering the average production from Alberta wells versus wells in Norway. The high Finding and Development costs for Alberta oil and gas is money that is spent predominantly with Alberta based contractors and employees. Money that stays in the province and contributes greatly to our economy. The current low gas price has already significantly curtailed the drilling and other services in the province and our economy has been hurt by that lack of activity. Increasing Royalties will further decrease activity and further damage our economy - especially in rural areas. I could support a moderate increase to the pre-payout royalty for oilsands, but that would be it. The losses to our provincial economy will dramatically impact the lifes of Albertans and result in less government revenues in the long wrong if the province goes ahead with this ridiculous royalty plan. I am offended by our government referring to comments by Encana and other companies as threats. Those are not threats. Those are simple statements of what this plan does to the economics for ongoing investment. No other company will step in and take up where these companies stopped investing because they will not be able to justify the investment either. This issue has been poorly managed by the current government and does not demonstrate strong leadership.
RRE3438 I think if the government passes these recommendations as they are presented in the Royalty Review you will send this province into recession. Gas drilling is at an 17 year low in this province. Alberta rig utilization rates are currently (as of last week) 20% to 30% lower than in BC and Alberta and 40% lower on a year over basis. I think there is room to negoiate on the Oil Sands Post Production rates indexed to the price of oil. If you do much more than that your time in office will be limited. The consequnces to the population of this province will be on par with what happened when the NEP was put in place. In 6 months from now, there will be primary and secondary unemployment, people's houses will be worth 55% to 65% of what they are worth today (ect, ect) and you (and you alone) will be the one they blame. If the federal government had suggested this royalty increase Alberta would be looking at succession. I voted for you in the leadership race because i thought you would be a viable alternative to Jim Dinning. If you send this through i will not only regret that vote i will work to ensure that you DO NOT represent this province for any length of time.
RRE3439 Ed is at a loose-loose situation that no matter what he does there will be upset people, so here is my suggestion: Raise the royalties in the area of 1 to 1.2 billion. Of that amount, half goes into the general treasury. The other half goes into the "Alberta Green Oil Fund" a new fund created by the government in which the funds are used for development of "green methods of oil extraction, better water use and land management." In short, a fund where the purpose is to develop methods in the oil industry that are less harmful to the environment. The beauty of this fund is that the contributors can apply to get their portion back, as long as they use it in a way that meets the criteria. No one can criticize the government for going green; the only thing the critics will say is that it is not enough. The oil companies can get half their contribution back and this way they are forced to develop newer green methods, as they know this industry best they are likely to develop the best methods. Hope this helps and good luck, [Information Removed]
RRE3440 Do it! Voters only get a say on things like this once every 4-5 years. Dollars vote every day, and big energy has a lot of dollars...dollars they're willing to spend on themselves, and on whining about how hard-done-by they are, but not on schools, roads, police, paramedics, nurses, doctors, hospitals, teachers, utilities, etcetera. I'd be a lot more willing to listen to their point of view if they didn't start out by threatening us. I'd be a lot more inclined to support their point of view if they did more with their record profits than demand more, and demand the rest of us continue to suffer with shortages in basic services just so they can continue to have their big cars, big homes, big lives. Alberta as a whole has become like Fort McMurray. Yes, some people make a lot of good money and buy nice toys and nice houses...but it's like Fort McMurray. If people consider that so good, why's it take a $4000/month living allowance to convince anyone to go there? If that lifestyle is so good, why are the big-oil execs moving into progressively more isolated neighborhood enclaves in Calgary, or out of the province entirely? I can not understand why a 20% increase in royalties (which amounts to a 1-2% actual increase in the amount of money the royalties take from these energy companies) is the death-knell that these companies are whining about when natural gas and oil prices will fluctuate by far more than that on a year-to-year basis. During the big bust of the late 70's/early-80's this happened again. Companies mis-spent and mis-managed and people who made a profit off of that mismanagement demanded it be continued...until, eventually, the costs were so high that any change at all, even a change that was necessary, brought the whole industry to a grinding halt. They blame the NEP for it, but I look at the costs and how they increased so rapidly that when oil did drop in price...though still high enough to sustain most other energy-sectors in the world...it wasn't high enough to sustain ours. Remind these whiners that their fiscal mismanagement and desire to take profits out of this province is why we have an unsustainable inflation rate, why their costs are escalating, and why, despite the supposed riches being held by a few, the majority are complaining that this boom is now a bust.
RRE3441 Don't try to fix something that isn't broken. The current economy is booming so why change the royalty scheme?
RRE3442 To compromise on the recommendations made in the report should not be made. The oile companies have for too long reaped the benefits of low royalties and now threaten to reduce investment is in my mind "blackmail" and should not be tolerated. Lets do what is best for all Albertan's. the oil companies will not be losing money; they will have reduced profits and if that requires us to make future adjustments, they can be done before there is any permanent damage to the economy of Alberta.
RRE3443 Instead of getting more money from oil and gas companies in the form of increased royalties, the government should force them to use that capital to lesson the environmental impact of the industry so that Albertans have land, air and water to use for centuries to come.
RRE3444 We've shown nothing but political instability in the past year by changing the playing field on Income trusts federally, and now hiking royalties provincially. These companies have based long term and even short term business plans based on current political realities that at the time seem stable, but now are unprofitable compared to other parts of the world in the middle east or even Russia. Investors would be wise to take there money out of the patch and invest in less politically sensitive intruments. Incase you haven't notice the entire provincial economy is dependent on the patch and this would clearly strangle the industry and in essence Albertans would go from boom to bust. I'm sure you want that on your resume as Premier at the time. If my company cuts its drilling program by 50% and I lose my job, then forsure you will not get my vote. When most albertans realize how closely tied to the oil patch they are it will be too late. Every job in Alberta is tied directly or as a result of spin off from the booming patch from trades to professionals to every booming business in this province. Once the E & P companies figure out its more profitable elsewhere they have to explore that option for there shareholders otherwise they aren't doing there job. So you need to ask yourself, are you willing to cut the hand thats feeds you or are you going to help regain Alberta's reputation as the world's most stable oil patch to do business?
RRE3445 I expect my government to enact the vast majority of the recommendations set forth in the royalty review report, anything less will be yet another slap in the face of Albertans. I suggest that you ignore the bluster and whining that is coming from the poor downtrodden CEO's and do something for those who put you in office and whom you are supposed to serve, the people of Alberta. Thank you for your time. [Information Removed]Calgary, AB
RRE3446 My name is [Information Removed]I work in the Oilfield as an Electrician/Instrument Tech. I have concerns that the provincial government is making a huge error. The proposed 20% is more like an actual 40-50% royalty increase with more up to date numbers used. This would equate to several more billion dollars than just the 2 billion our government needs for Alberta’s infrastructure. I very much agree that the royalty rates need to increase just not to the Industry devastating increase “the panel” is proposing. I care for my city Grande Prairie and my neighbors this proposal increase just simply cannot happen. If this takes place the Oil and Gas Industry in Grande Prairie and more importantly many of the families of Grande Prairie will be devastated.
RRE3447 I certainly hope that the recommendations in the royalty review report are closely followed. It is also important to try to bring those disputing it on side but, in the final analysis, to follow these recommendations is the right thing to do for the majority of the people of Alberta.
RRE3448 The government of Alberta should leave the system as is. The money that stays in the hands of the oil industry will be re-invested in the province and the benefits the people of Alberta see will be many times the short sighted increase of royalties that the government will collect. Besides, the government is already drowning in surplus, why not let the oil industry re-invest to create future revenues? I am in the industry and I know only too well the margins that we are working under right now. You can see in the CAPP data how poor the return to oil investors is in Canada compared to some of the other jurisdictions that we are compared to in the report. The federal govt has already made it incredibly difficult to raise capital (greenhouse gas emission legislation, Trust taxation etc..). I am not sure you realise how close to the edge many of the juniors in this province are to failing! Take a look at how much money oil companies have to invest to keep growing, the cash flow is not enough, they must borrow to survive and you proposed changes will make that impossible, as no one will line up to lend money at decreased rates of return. Stop asking university professors, Shell heavy oil geeks and timber industry employees how to run the oil business!
RRE3449 CEO of [Information Removed]owes his career to the Alberta Government creation of Alberta Energy Company.
RRE3450 where was the Albert Government when the Federal government decided to tax the royalty trusts?? Lyle Oberg submitted a letter of support! What are you thinking? We have a corporate structure that has a low cost of capital which allows companies to compete world wide and exploit "marginal" oil and gas projects ie: most oil and gas targets remaining in Alberta and you stand by and allow the federal government to [Expletive] it up. now you have decided to allow a committee to review the entire royalty system and make public statements about how they know best and te royalty sytem must be dramatically revised! The average Albertan on the street does not understand the current royalty system; so of course they are influenced by this committee's comments. stop this nonesense now and let's get back to business! this uncertainy is hurting all of us now. numerous investment research analysts have discouraged investment in Alberta based companies until this is all sorted out. the oil industry needs to see the Alberta Government support it now !! Do the Right Thing! Leave things well enough alone!!
RRE3451 Mr. Premier; I believe that there should be point somewhere between what the Royalty Review Committee has recomended and what the current s rates are. Any increases to this royalty rate rate should be phased in over a period of three to four years. This balanced approach would be perceived as a striking a balance for all involved and perceived not to be onerous on any one group of stakeholders involved. Thankyou for giving Albertans the opprotunity for their input in this regard. [Information Removed]
RRE3452 I FEEL THE PANEL SHOULD REAVALUATE THEIR DECISSION OVER THE ROYALTY REVIEW AND WORK WITH THE OIL INDUSTRY TO RESOLVE THIS ISSUE. AS WE FEEL THE INFORMATION THE PANEL HAS IS WRONG. MORE ACCURATE INFO IS NEEDED BEFORE A FAIR DECISSION IS MADE. [Information Removed]
RRE3453 Please leave the royalties alone. We live in a prosperous province with no debt. We have a stronbg economy based on the engine we call the oil and gas industry. Gas prices are low and it is less and less viable to drill. Oil and gas trusts are still trying to recover from last October. Please leave the royalties alone.
RRE3454 This royalty review if implemented could be the “straw that broke the camels back”. Our gas produced in this province represents ˜60% of total production and with gas prices at $5.00 AECO the profit margin is small. Most economic decisions for high risk gas exploration are being evaluated at a minimum of $7.00 gas. If this royalty increase is implemented you will be able to build your roads, hospitals and schools but many of the people in Alberta will have no jobs. Unemployment will sky rocket and it will be a social economic disaster and in the first time in decades you might see a Liberal Government in Alberta voted in the next term. Please consult the energy industry and have some input into this from people that actually understand how the oil and gas business works.
RRE3455 DO NOT RAISE THE ROYALTY. OIL COMPANIES PAY ENOUGH IN FEES AND TAXES DO NOT KILL THE HEN THAT LAYS THE GOLDEN EGG.
RRE3456 It is time we got more royalties from our resources. Norway certainly does. Good luck Ed
RRE3457 To Whom It May Concern: I write this letter in strong opposition to the Alberta Royalty Review Panel’s documentation that was presented to the Premier’s office on September 18, 2007. I was born, raised and am currently employed in the oil and gas industry here in Alberta. It is my feeling as a conservative voter of this province, that if the recommendations made by the Royalty Review Panel are accepted, the result will have a devastating and irreversible impact to the economy of Alberta and Canada. While government revenue may initially increase, I believe that it would decrease in the longer term due to this resulting decrease in activity. The oil and gas industry in Alberta is already feeling an economic crunch that it has not seen in years. Spending has reduced drastically compared to previous years due to the high costs associated with developing Alberta’s resources. If this Panel’s recommendations are implemented, many gas wells in this province that are currently producing and generating money for the average Albertan, will no longer meet economic numbers to produce. If a well is not producing, it is not making money for anyone. Alberta’s oil sands developments are key issues. While certain companies have made backroom deals with the government to have current royalty rates remain in place until 2015, others do not have this option. This is simply unfair, un-ethical and does not have the best interest of the average Albertan in mind. Alberta’s oil companies, not the government, have created hundreds of thousands of jobs in this province. This government has done nothing to support initiative for economic development of new industry in this province and now as a result, the province has no alternative we can fall back on. Simply put, we need the oil and gas industry in Alberta to remain strong and competitive and to encourage development here. It is my feeling that if royalty rates were to be hiked in this province, I will be forced out of a job and likely the province in search of work. As a tax payer of this province, I feel I have made great sacrifice to see this province become debt free under the current royalties plan. I hope to one day raise a family in Alberta, however for the first time ever, there is a great deal of uncertainty for my future in this province. Why has this province become so greedy? You simply can’t always have your cake and eat it too. Thank you for taking these points into consideration. [Information Removed] Albertan
RRE3458 I think Premier Stelmach should stand firm on this issue and not be bullied by the oil companies. Albertans did not get a break on gas prices, at the pumps or heating our homes. Big oil is posting record profits to line the pockets of their investors. We, Albertans should profit as well! The oil is not going anywhere, so eventually they will come around.
RRE3459 There is no need of more tax on anything!! We are already paying to much in Alberta. Our deficit is payed down and we are running surpluses. There is no need for more money going to inefficient government programs or beauracracy. I am tired of working harder and having less because of governing beauracracies taking more from me and giving me nothing more in return. I can spend the money much more wisely on my own behalf. [Information Removed]
RRE3460 From: [Information Removed] Sent: Tuesday, October 09, 2007 9:25 AM To: 'lacombe.ponoka@assembly.ab.ca'; 'calgary.fort@assembly.ab.ca'; 'jhayden@jackhayden.ca' Subject: Our Fair Share I would like to thank each of you for taking the time to review the correspondence that I have submitted to you and for your responses. My husband and I own properties in all of your ridings and feel that we have a vested interest in the communities. As an Albertan, I believe that it is important that the government ensure that it is receiving the maximum benefit from it's resources. I do not disagree with the suggestion that the royalty rates need to be assessed; however, I believe that the government needs to address the issue of capital investment and the cost of infrastructure required to produce the resource and process the resource. All of my questions submitted to the Royalty Review Feedback have been with respect to the costs associated with taking the raw resource and turning into a saleable product. When determining the changes to the royalty program, I urge you to consider these costs and the benefits that Albertans have experienced because of the investment in their communities. I do not believe that the industry will pull up stakes in Alberta if the royalty rates are increased. I do believe that the industry will move their capital budgets from Alberta if the government does not allow for fair and equitable capital cost and operating cost deductions. The business decisions will not be a visceral reaction, but very practical based upon economics and shareholder value. It is important to remember that very few companies hold all of their properties in one jurisdiction. Nexen, for example, has properties in Canada, the United States, Central America, Great Britian, Yemen and Africa. The conventional Canadian properties, although a secure operating environment, are nearing the end of their life cycle. The need to pursue the unconventional resources is imminent. The costs of producing unconventional resources will determine the floor price required to make the project viable. Some of these other jurisdictions may come with some level of risk, political or economical; however, offer more opportunity to lengthen the company's reserve life if a large resource were discovered. The company's investment strategies are not so different from our own - build a strong base of low risk investments and gradually move up the ladder of risk. Please keep in mind that many Albertans hold investments in the oil and gas industry; whether in a trading account, mutual fund or RRSP. As representatives of the people of Alberta, I implore upon you to consider this. Your time and consideration in this regard is greatly appreciated. Thanking you in advance, [Information Removed]
RRE3461 Mr. Stelmach. In my opinion you are doing a stellar job with this province. People who are asking for more royalties dont realize how good we have it and how wealthy we really are. Please remember the golden goose story [Information Removed]
RRE3462 The Panel Report has recommended a substantial increase in government take on the current and future production of oil and natural gas in Alberta. However, the potential impact to the future activity and future production of oil and natural gas in Alberta, resulting from the Panel’s recommendations if adopted, was largely overlooked. While government revenue may initially increase, I believe that it would decrease in the longer term due to the resulting decrease inactivity. There are relatively high costs to developing Alberta’s resources. Alberta’s high cost, technically challenging resources create a lot of jobs and economic activity as they are developed. Adding to those costs by increasing royalties could have a drastic negative impact on oil and natural gas activity in the Province. The panel’s recommendation has created significant risk to employment in the Oil and Gas industry and subsequent spin off industries in Alberta. Higher costs of drilling and developing have already impacted members of my family as they have lost work due to companies decreasing their investments in these areas. I am very concerned that the government will implement these recommendations without due consideration of the base capital cost assumptions that I believe are significantly understated.
RRE3463 Hi,I was born ane raised in Alberta. After a finisned high shcool I started working in the oilfield.That was in the early 80's.I have seen a few slow downs over the years due to oil or gas price.But if this goes ahead as the review proposed there wil be a very high lay offs all over Alberta & canada.I am very concerned with the furture of my guys that work for me and my own.The royalties should be changed but not the way the review proposed it.We have the best province in Canada, Alberta is the best place to live in the world. Please do not send are country into a recesion. Thanks [Information Removed] Concerned oilfield worker P.S. Do the right thing.
RRE3464 It is no secret that the big oil companies have been making their "fair" share as of late when it comes to profits. I hardly think it is unreasonable that ourselves as Albertans benefit from this profit pool as well...considering they are happily taking our *non* renewable resources with glee. Let them grandstand and threaten; there are many players in the game and I am more than sure they will step up and welcome the chance to have their share of the pie should anybody decide to pack up and leave. Enough already! Is big oil going to come back in 100 years when the reserves are dry and support our province out of good will? I think not.
RRE3465 As a constituent of Alberta, I think it's my obligation to comment on the poor performance of the current conservative government in Alberta concerning the recent royalty review. As an Albertan and an employee of the energy sector, I appreciate the need to balance government take and corporate return. With the recent rise in oil prices, governments from most jurisdictions have been re-assessing government take with the introduction of windfall taxes tied to oil prices. I imagine, it's in this spirit that the Alberta government has undertaken the recent royalty review here in Alberta. This is dangerous ground for all who embark into this realm. The santity of contract is, above all, the foundation to investment around the world. Even the perception of contractual default will erode confidence in any jurisdiction. As such, any royalty clawback has to be developed with industry, founded in reality and delicately executed, again, in conjunction with industry. It appears that the new government in Alberta has shown it's inexperience by creating a counter productive "them and us" atmosphere, basing it's position on flawed data developed in isolation, without industry input. Wood Mackenzie, the most respected worldwide independent commercial industry analyst, came out with an opinion two days ago indicating the report had used outdated costs and assigned flowing barrel costs for developing oilsands in excess of 90,000 CAD/barrel. The royalty report used outdated P90 - P10 cost ranges of ( approx. ) 38,000 to 83,000 CAD/barrel. In otherwords, the maximum cost used in the report was below the actual present day industry cost. What the Alberta government doesn't seem to appreciate is the exponential increase in all costs that the oil industry has experienced in the last two years, from drilling to facilities. This major error suggest the report is fundamentally flawed and should not have been the basis for the Alberta governments posturing and apparent politicizing of the issue. I hope the Alberta government will now take the appropriate remedial action and work with the industry to reach an appropriate position on the issue of royalty review. Continued posturing based on on a flawed document created in isolation will not be beneficial to the average Albertan, the oil industry, the people of Canada since Alberta is currently Canada's economic engine, and the conservative party of Alberta. Regards, [Information Removed]
RRE3466 I believe that the royalty increases will be a horrific mistake to this province. I believe one of the main reasons the general public is agreeing to this change is that they believe they will receive "their fair share" in the form of a cheque payable to them, similar to the Rebate Cheque's we all received a few year ago. When in fact, they should realize that the royalty increase would do the exact opposite. It will cause a very big trickle effect down to the very restaurants that the oil rig workers eat in, to the hotels they sleep in, to the gas stations they fill up their vehicles in. The small towns will suffer. And it is the people who live in those small towns that do not see the big picture, all they see is the chance they may see dollar signs.....
RRE3467 As a resident of Calgary, I am deeply upset about what is going on with the royalty review report. How can the panel make a proposal based on figures that are incorrect? Obviously, the panel do not realize the impact of this. What they are doing is killing the oil and gas industry and eventually damaging the economy. I hope the government listens to the voice of the people and diligently look at the facts before making a decision.
RRE3468 Do members of the government need more money for a new summer home? i realize houses are expensive but what about the hard working labourers, welders, operators,etc that won't be able to pay their mortgages because of all the work that's being cancelled?
RRE3469 Albertans want as good a royalty deal as our neighbours. Why would we not? Oil and gas are scarce commodities, why would we sell out cheap? because we are threatened? because you (Premier)are threatened? We wont live scared, what's the point of that?
RRE3470 I do not believe the proposed royalty tax will be a benefit to the province of Alberta. On the contrary, I think that it will have a devastating impact on employment. We are the richest province in Alberta because of oil and gas. Why is the government trying to squeeze the life out of an industry that creates more jobs and wealth in the province than any other? Do oil and gas corporations not pay their fair share of tax already?
RRE3471 I feel that the police should b called in to investigate why the Energy Utilities Board has failed to collect billions of dollars. As part of this police investigation, a forensic audit should be also be started.
RRE3472 It is time that the oil indusrty paided it's share. The economy of Alberta is over heated with too much money floating around. Let the goverment collect and save more cash for when the oil runs out. Removing some money from the economy, will slow it down so that the regular rules of supply and demand allow for some competition and sanity to the towns and cities we live in.
RRE3473 Alberta is a great place to live and raise my family, if the proposed changes are made it will effect the chance for my kids to have a great future, we will see many of the investment dollars going to other area in the world. Lets work with the oil compamies to find a reasonable solution for future development.
RRE3474 Go For it. Give it to the oilcompanies. I've already sold my house, and if things go [Information Removed], I'll go to Kazakhstan to work, buy a bunch of ondos in Calgary when they drop 30%, and sell them when the price goes up after you idiots realize you [Expletive] up. Been hrough this before many times in the last 26 years, and I don't give a rats [Expletive]. You political fools will do whatever you will do, and if you don't , the oil price will drop, or the FEDs will bring in a carbon tax. Did you ever hear the phrase "let sleping dogs lie"? Obviously not. I'll come out of it OK whatever you do, I always do. Obviously, I work in the Patch.
RRE3475 Under the current proposal, the review is being short-sighted and failing to see the trickle down effects that will be felt drastically in the smaller communities. I live in Edson and see the economic infrastructure that the oil and gas industry brings to the community. As a rough estimate I would venture to say that 90% of employment is directly or indirectly related to this industry. If the review is approved in its current state and resource companies decrease their drilling and exploration far more than just those companies will be affected. Loggers, surveyers, pipeliners, instrumentation and electrical tradesmen, mechanics and well servicing/maintenance crews will all be directly affected by the slowing of activity. And with the slowing of activity, people in the service industry will also suffer. Hotel employers/employees, restaurant employees, travel agents, retail store operators and employees, and all others will be indirectly affected. It is imperative that this proposal is strongly reviewed before being passed and at the very least decreased in the amount of royalties suggested.
RRE3476 It is my understanding that the increases in royalties will be significant. The government needs to view its natural resources like a business, where oil & gas reserves are the government's product, and those who invest in getting it out (oil companies) are the government's customer. If the royalties are too high, the government's customers will reduce their spending, and thus there will be less royalty revenue in the long term. Not to mention the jobs that will be lost due to investment that is no longer made. I think these drastic increases are a bad idea for the people of Alberta, who not only elect the government of Alberta, but also are part of Alberta's workforce. [Information Removed]
RRE3477 The report from the Royalty Review Panel as given needs further work. There are numerous reports about flawed calculations, omissions, etc. It should be re-done with all the data included. Increasing royalties reduce the potential returns for the oil & gas industry. This will make some wells uneconomic to drill. Reduced activity will mean less work and potential job loss. At very least it will slow down the Alberta economy. Keep our economy running. Don't stop it. Panel run by Forestry person, who believes oil industry is destroying their precious trees. No chance of bias here is there? Don't adopt report as it stands. Review further with experts on the panel that have no preconcieved ideas of what should be done.
RRE3478 Raising royalties to the level the panel wants would put too many people out of work. Use your head instead of trying to be a media hero. Put in a solution that keeps jobs in Alberta.
RRE3479 The oil royalties should not be increased at all !!! We have more than enough revenue at this time to manage our province, with a surplus LEFT OVER. With the rising dollar, against the US dollar, our oil companies are making less because they are paid in US funds and have to operate in CDN dollars. If royalties are raised this will cut into profits and slow down growth. Do you remeber 1986 when oil prices went to less than $10.00 / barrel? I am not saying oil price will drop but the spending stopped in. 1986 and lay offs were everywhere and this will cause lay offs again even with high oil prices. With lay offs this will cause lost tax revenue for the government in personal income tax and corp tax and also a decline in Alberta's population. Our economy will probably go to [Information Removed]. THINK VERY LONG AND HARD ABOUT THIS. DON'T LET THE LIBERALS AND NDP DRAG YOU AROUND BY YOUR NOSE. I started my business in Jan of 1986 with 2 other partners and by May that same year I was by myself with no revenue at all, but managed to make it. Today, I have a new shop in Wetaskiwin and there is 9 of us on the payroll. Our company has grown a little every year, so don't srew it up for us because I am getting closer to retirement and don't have time to start over again. Our business is a family owned and operated. For more information about us our website is, [Information Removed] Mr. Stelmach, I would be more than happy to show you our business and product if you are interested. Thank you and have a good day. [Information Removed]
RRE3480 Hello I have worked in the oil industry for the last [Information Removed]years. We all know from past experience that when the Oil companys that do the work in OUR provence get worried ab out not having a high profit margen they go else were to get that. Usally other countries. So If our goverment thinks they can get more money out of them, the better keep in mind what will happen if those companies do make lots of money. Also we all understand that thy do make tons of money in the production of oil. WELL HERES THE THING. WHEN THEY MAKE LOTS OF MONEY SO DO THE PEOPLE THAT WORK FOR THEM. Like myself and I would imagine over 100000 people who live in Alberta. So what is better you the goverment getting 2 billion dollars that us citisenes might see some kind of change in were we live. Or keep those 100000 or more people working and making over 120000 dollars per year, that is a very low estamate. 100000 x 120000 = 12,000,000,000. Imagine that it equals 12 billion. and that is a very low estamate. I HOPE SOMEONE READS THIS AND YOU GET THE MESSAGE THAT PLASE DONT TAKE OUR LIVELY HOOD FROM US. SO WHAT THOSE COMPANIES MAKE SO MUCH MONEY ATLEAST WE ALL MAKE LOTS OF MONEY. Regards [Information Removed] ps my estamates are very low. the people that make a living indirectly from the oil industry is probably closer to 500,000 in western Canada. so 500,000 x $60,000per year = 30,000,000,000 mmmm imagine that one. So think real hard about that 2 billion our goverment is tring to get out of those big Oil company's once per year. When the poeple of this provence can make 15 x that once per year. So maybe another property tax hike might be beter for all of us.
RRE3481 This report makes the government look greedy. It is well known how little the margins are in the province and how expensive op costs are here. The oil industry directly or indirectly, creates jobs for most of the province. Alot of the projects are barely making money. By increasing the royalties, you devalue the projects and risk having projects shut down or never start up in the first place. The loss income taxes, from lost jobs, and lost production royalties would be a tremendous blow to the Alberta economy. Alberta needs the oil companies more than the oil companies need Alberta. Let's not push them away. Why not establish royalty rates based on return on investment? Have low royalties until payout to encourage more activity, and then an increased royalty later.
RRE3482 I have been working in the Alberta Oil & Gas and Oil Sands industry for just over 30 years. A significant portion of this time has been spent working with the Government of Alberta in respect to royalty matters, particularly oil sands royalty matters. I am well known and I believe well regarded by the staff and executive of the Department of Energy as a fair minded and knowledgeable person in dealings with the Government. In reading the Royalty Review Panel’s report and recommendations, I am struck by the similarities between the motivation and tone underlying this report and the National Energy Program. The perpetual misperception is that the business of finding and producing Alberta’s oil, gas and oil sands resources is a licence to print money, with the companies and their investors making unfair windfall profits. In fact nothing could be farther from the truth. The 30 years of my career is strewn with investment casualties, reflecting the high cost and high risk of developing these resources. The buildings in downtown Calgary in many ways represent tombstones, with so many being named after companies that came and went. I have worked for four different companies thus far, and all but one of them has disappeared. In the case of oil sands development, where much of my career has been focused I have seen numerous companies invest hundreds of millions of dollars only to end up either abandoning their projects or selling them off to new developers for pennies on the dollar. In this regard I speak from experience, having participated in both the sale and the purchase of oil sands projects. I am extremely disappointed in the work of the Royalty Review Panel. The most critical flaws in the Panel’s report are: o The failure to recognize the high cost and risk of developing Alberta’s hydrocarbon resources. In particular the failure to recognize that the costs of development have gone up continuously and show no sign of abating. o The failure to recognize the volatility of oil and gas prices. The 1980’s taught everyone in the industry that prices can climb precipitously high and suddenly, unpredictably fall just as far, literally overnight. o The terrible impact that major changes in the fiscal environment can have on companies, individuals and the Province as whole. The Panel members seem to have forgotten the thousands who lost their livelihood and in some cases, their homes as a result of the collapse of the oil & gas industry in the 1980’s. For unknown reasons the Panel also overlooked the tremendous problems experienced by the Government in funding programs when its revenues collapsed with the collapse of this industry. o The failure to recognize how much every Albertan depends on my industry for the economic prosperity of the Province. Prior to oil and gas development starting in earnest in the Province, Alberta was one of the poorest provinces in Canada (lagging behind even Newfoundland). o The failure to recognize that the people who are the share holders and owners of the companies who have and continue to develop Alberta’s hydrocarbon resources DO NOT live in Alberta. Their perspective is one of global investment. Alberta has been an attractive place for investment compared to other options largely because of the stability of the royalty and taxation regime. Continued development of Alberta’s resources depends on these non-Albertans continuing to believe that Alberta is a good place to invest. o The failure to recognize that the imposition of new royalty rates and production taxes on existing oil & gas and oil sands developments, will send a very negative message to investors, with that message being, that an additional risk of investing in Alberta is the possibility of the Government acting arbitrarily to reduce the potential value of and returns from the investor’s investment. o The failure to recognize that when an oil sands project has “paid out” this is the point where the project developer/investor has only recovered his original investment cost and earned a small profit equal to the long term bond rate. Given the risk associated with these investments, the developer/investor needs to earn more than the long term bond rate to justify such enormous investments. Any increase in the after payout royalty rate or imposition of a new tax on production revenues, extends the period of time over which the developer/investor must earn the rate of return necessary to justify his investment in oil sands development. This makes oil sands development less attractive compared to other alternatives and will lead to less investment in development of the Province’s resources. If the Government adopts the recommendations contained in the Panel’s report, it will send a very negative message to the investment community. In a repeat of history from the 1980’s, this will lead to investment for hydrocarbon development in Alberta drying up, leading to a reduction in direct opportunities for employment by Albertans (and possibly lay-offs?), and a reduction in revenues for the Government of Alberta throwing us back into the days of fiscal belt tightening. In the 1980’s and early 1990’s I saw thousands of my fellow Albertan’s lose their jobs. I was eventually laid off myself. Record numbers of Albertan’s lost their homes and businesses. The Government was forced to make major cuts in social programs and infrastructure funding in order to cope with reduced revenues from royalties and taxes. Much of this suffering was due to an arrogant and insensitive group of politicians in Ottawa. I pray the elected representatives of the Government of Alberta will recall the terrible times that we endured in this province during those dark days and avoid duplicating the mistakes of the Government of Canada. The current royalty and taxation regime in Alberta has generated tremendous revenues for the people of Alberta. Rather than acting like spoiled children craving more for the present at the sacrifice of our fiscal future, we should stand firm in maintaining the status quo, thus maintaining the view in the eyes of the non-Albertans who have provided most of the investment dollars required to develop our resources, that Alberta is the best place in the world to invest in. [Information Removed]
RRE3483 For those of us who have worked in the oil and gas business for 30 years we have certainly experienced first hand the boom and bust cycles. The bust cycles may have initially commenced due to factors beyond our control (for example low oil & gas prices) but can be accelerated by poor government policy (for example the NEP). The present royalty rates are there for good reason and, while they do need to be reviewed and fine tuned from time to time, be careful about making wholesale changes without considering all the factors and long term implications. It is good that Ed Stelmach is still listening and I sincerely hope that his government makes decisions that are in the best interests of all - oil and gas industry, the rest of Albertans and even all Canadians.
RRE3484 The total royalty is determined by not only the rate, but also the total revenue from the oil/gas industry. Incresing royalty rate does not necessarily mean the increase in total royalty if the total revenue goes down.
RRE3485 For the first time in my lifetime as an Albertan and a voter, I am gravely concerned that the Stelmach government truly does deliver a fair ruling on the royalty review recommendations. When I use the word fair, it is intended to represent a win-win resolution where the energy industry the drives Alberta's economy isn't crippled by the governments need for stable revenue from that industry. I am an employee of one of Canada's remaining energy companies and I work in coalbed methane. I have been directly involved in running economic models for projects, budget planning and most recently what-if scenarios with the propsed royalty changes. We are seeing a perfect storm develop that will result in discontinued investment in [Information Removed]due to continued high input costs, decreasing gas price and increasing royalties at gas prices less than $8/mcf Cdn. I know this will affect me, another 50 or so people in my company who are directly involved in this type of resource development, investments in the rural communities we work in and the service companies we contract with for goods and services. I agree that in high price environments, there is room for increased government take in royalties. My company, in it's own right and as a contributing member to the [Information Removed]response, also agrees. But the analysis put forward by the royalty review committee does not accurately represent our business or the total contribution my company makes to Alberta. If Ed Stelmach is true to his word, he will critically look at both sides of the arguments put forth, and find the middle ground that will in truth and fact, deliver an improved economic outcome for all Albertans, and Canada as a whole. [Information Removed]Calgary, Alberta
RRE3486 I want to clearly say that I expect the royalty review report to be adopted without compromises. The Government is the steward of provincial resourses. The Government represents the citizens of this province. These resources are non- renewable, and should not be given away, nor sold at bargain basement prices. The Government is not representing the oil industry. I suspect that the industry's response is disingenuous. Nontheless, the possibility of a slow down in the oil patch is not a good reason to keep the current royalty regime. This province must get the most for its resources. Besides, our economy is over-heated at the moment. My family was in this province before oil was being produced, and it will probably be here when the party is over. I don't want future generations resenting our decisions.
RRE3487 Why bite the hand that feeds you????
RRE3488 A panel from the energy industry - such as companies that have actual properties in different jurisdictions should have been included in order for this report to hold any merit. Alberta production is low (per well), hence we have to drill more wells. The distance covered to get the product to market is further then most and both the capital and operating costs are higher here. It all comes down to the internal-rate-of-return (IRR) on investment. If the IRR is going to be higher elsewhere, companies are going to go elsewhere. I see 1981 happening all over again, and am considering moving to Texas. Unfortunately, my decision is being made for me as I'd rather stay in Alberta... If the government is so smart, why don't they start their own production entity to perhaps take advantage of the high commodity markets (you only see the upside - high cap / op costs are not broadcast over daily market indices...), then they would be in a position to better understand all that affects the IRR. God help us if the oil price drops back to ~ $ 40 / bbl. [Information Removed]
RRE3489 I am concerned by the recommendations of the royalty review panel. There has been a slow down in the oil & gas industry in Alberta in the last 12 months. This slow down is a local event. Every other oil and gas nation is running flat out. Alberta's slow down is the result of an already unfavorable business environment. Royalty increases will divert capital and jobs outside of Alberta. Please listen to the investment analysts. If they aren't convincing enough, then please explain the sudden slow down in the housing market in Calgary.
RRE3490 The best way in most situations is the middle way. The majority of Albertans want action on the report and its findings, yet they want our economy to remain strong. Perhaps an increase of 10% will show the people of Alberta (indeed, the voters) that action has been taken and a promise kept while sending a signal to the oil industry that the province will not be held hostage by their threats of reduced investment. Such corporate blackmail must not be tolerated; no matter the stakes. Premier Stelmach would go a long way to being a leader worthy of respect by the entire province if he walked the path of moderation and honesty in this matter.
RRE3491 I am an ordinary Albertan. I support the findings of the royalty review report, and support the suggested changes to oil and gas royalities in Alberta. It is time for Alberta to receive its fair share of Alberta's resource revenue. Do it now. [Information Removed]
RRE3492 PLEASE LEAVE THE OIL ROYALTIES ALONE. MY JOB DEPENDS LARGELY ON THE OIL PATCH. INCREASING ROYALTIES WILL NOT BENEFIT THE "AVERAGE ALBERTAN" IN ANY WAY, AS FAR AS I CAN SEE.
RRE3493 Please look at all of the data before making a decision. Please do not just that the panels recommendation at face value. Our bright future in Alberta depends on it.
RRE3494 WHAT ARE YOU THINKING????????? lets ruin a good thing guys!
RRE3495 Hello, I'm a Grade 9 student. I am writing to say the royalties are good.
RRE3496 I am very concerned about the royalty review panel's report. I think it fails to take important things into account and does not look at the big picture very carefully or with the type of insight you'd expect from a panel of experts. We need to be careful not to kill the projects - particularly the oil sands projects - that oil and gas is investing in (and there is a very real danger that this might happen if the report is implemented as it stands). Large oil and gas companies, like the one I work for, have internal hurdle rates before they decide to invest in a project. Our Canadian business competes for capital investment with the rest of our global operations and our rate of return needs to be high enough to encourage this investment. The suggested changes may seriously put our projects at risk. It feels almost like we are forgetting what an essential part of our economy oil and gas is, and how many people's livelihoods and welfare depend on the industry. We also forget that the oil and gas industry is made up of people like me - hard working Albertans who deeply care and don't want to lose their jobs due to an uninformed government decision (especially if that decision is politically motivated). I am a newlywed and my husband are planning on starting a family here. I am concerned about buying a new house or making any long-term decisions with this type of economic uncertainty. I am concerned I will lose my job, the economy will tank and that I will have to take my 10 years of post-secondary education elsewhere. As an Albertan, a taxpayer and a voter, I hope our government will do the right thing here because our Fair Share of nothing is nothing. Thank you, [Information Removed]
RRE3497 I have the distinct feeling if the report on Royalty Review is not acted upon, that in the next election the voters will. The Oil Companies need to know that if they want to play the big babies and hold back from development or move out of the Province that is okay, another company is knocking at the door to get in. We all know that the petroleum product that they are producing is a hot commodity and that the Oil Companies are raking in huge profits. Would you not cry foul if the Federal Government came tomorrow and said the the Alberta Royalities had to be shared more with other Canadians??? Wages in this province are out of control the leader in this problem is the oil companies and with their get it at any cost attitude. Between the inaction of the Government and the Oil Companies this Province has hit a crisis in not having enough workers, housing and adequate resources to take care of the influx if people moving in. A little bit of a slow down will not injury our economy in any way. That oil will still be there for many more years and this will ensure the prosperity of our Province and all the people who live here that much longer. My vote is to enact the report and maybe we could use that money to back on Health, Education and helping the people in this province that need it the most. Thank you [Information Removed]
RRE3498 To Whom It May Concern: As an ordinary citizen of this province, I have to wonder where the Alberta Advantage is? We have property values going thru the roof, astronomical parking fees in Calgary (the highest in the country from what I understand), heathcare premiums and high gas prices. We need billions of dollars all over this province for infrastructure, healthcare, school repairs, not to mention how about giving personal tax payers some kind of break if possible and/or putting some ore money in the Heritage fund. We have oil at over $80 a barrel when the oil industry/OPEC stated that they wanted oil at $50 a barrel. The oil companies are mailing multi billions of dollars off our resources, that remember once they are gone they are gone. It is my understanding that the $2 billion would put our royalties in the middle of the pack from other jurisdictions. Is there anything wrong with that? Nope! Please standup for Albertans and get our fair share out of our non-renewable resources. Thank you.
RRE3499 Don't buy the line that if we Get Our Fair Share then the oil companies like Encana will have to leave. Instead, show them the door and let them know others will be taking their place at the trough. Reading into their actions we must assume they aren't able to manage their costs and should leave- the industry or the country.. We're just one of those small Alberta companies waiting to be paid by this dinosaur for services rendered.. When we ask "When can we have our fair share for doing the work?" they respond with the proverbial runaround through 15 departments. I say, let them go and open up room for others.
RRE3500 To whom it may concern If you pass this new royalty review there is going to be a lot of jobs lost. Young familys with no home to live in. I know there is a lot of money in the oil patch but if the royaltys increase then the oil company are just not going to spend the money. the year 2007 has been the slowest year I have had in 8 years of being in the patch. you guys scare the [expletive] out of me with this "Your Fair Share". The oil companys spend the money to get it out of the ground so maybe if you want your fair share, you should split the costs with the oil companys who spending millons getting the oil gas out of the ground. Please reconsider this as Alberts Depends on your decisons
RRE3501 I am totally against the Royalty review. I do strongly believe that the Alberta government gets enough money from the royalties. You are coming accross as being a greedy government and you will put this province in a recession. Instead of giving into the pressure from your investors, you should think of the tax payers, because in the long run it is us that will pay for your poor judgment. Maybe it is time for a change in government.
RRE3502 For far too long this province has administered its natural resources with a distinct bias towards the companies who reap enormous profits and with little or no regard for the citizens who ultimately both own the resources and endure the environmental and economic consequences of this bias. I am very much in favour of redistributing the profits from our natural resources in the form of royalty reform, particularly if the profits are spent improving the quality of life for Alberta's most vulnerable citizens rather than on enhancing cabinet minister's Hawaiian vacations.
RRE3503 Reply not required. Party future and election results will be the final response. In addition to initial tax incentives, for years taxpayer money has provided support to the oil industry. That was investment by Albertans. In return, the taxpayer has enjoyed some tax and work benfits but only as long as the oil companies got a healthy return [as any business must]. However, also in return, the taxpayer has paid excessive gasoline prices well beyond international costs [US gasoline around $ 0.70/L] while we now 'enjoy' a price drop to around $ 0.97/L and the US dollar is at or near par to the Canadian dollar! Bottom line? Financial return to Albertans both government and citizes has been pretty dismal. Do you think that the oil companies will not want profit if it is somewhat less? Get real. It is long overdue for the Government of Alberta to get more return for our non-renewable resources and for at least some of that money to go into infrastructure, education, welfare for the homeless and other needed expenditures. [Information Removed] Edmonton
RRE3504 Its too bad the previous gov't s put their heaeds in the sand when it came to royalty review.Instead of 20% increase immediately we could have had a 5% increase each year which would have been easier to swallow for the oil cos. Iam in full support of a royalty increase.
RRE3505 As an oil worker, i know that thier is potential for impacts to affect me and the lifestyle i enjoy. However as an albertan i think it's the right of the government to have a greater amount of royalties, this in turn can be spent on things as vitial as infastructure!.
RRE3506 As an Albertan, and a longtime worker in Alberta's oil and gas sector, I have serious concerns regarding recent recommendations made by the Royalty Review Panel to increase energy royalties. While I accept that there is an advantage to the Albertan public-at-large in the collection of increased oil and gas royalties, the amount of the increase is inappropriate. The Albertan energy industry depends to a large degree on natural gas and oil sand production in fields where harvesting of these resources is complex and costly. The panel does not appear to have accounted for this when making their recommendations - instead, under the proposed scheme, what the panel forecasts as approximately 20% increases will no doubt in reality be much higher. Simply put, inordinately high royalty collection will negatively impact the industry by lowering the amount of revenues that the energy sector has available to put back into pulling the resources out of the ground. This means that many projects will be cut back or eliminated altogether. The trickle-down effect of this is loss of many jobs in communities where these jobs are depended on -- depended on by the oil workers, their families and their communities. The adverse effects of this on a long-term basis are staggering. I urge you to do whatever you can to ensure that the panel recommendations are not adopted as currently stated, but are adjusted to meet the realities of the Albertan oil sector and the communities who depend on it for their livelihood. Thank you. [Information Removed]
RRE3507 Don't let the the big oil boys intimidate us. They are not paying their fare share of royalties. Mr. Klein was giving away our non renewable resouces. As an Albertan I say raise the royalty tax.
RRE3508 I fully support the implementation by the Government of Alberta of the full set of recommendations of the Royalty Review Panel. The more details I read and hear on this matter the more convinced I am that the previous government leaders of Alberta have "dropped the ball" on protecting the interests of the citizens of this province. I will be satisfied with nothing less than the recommendations of the Royalty Review Panel fully implemented.
RRE3509 The people of Canada depend on our governments to provide a stable, honest , and safe environment to live and work. When the government renigs on a deal it's made with investors it is not only dishonest but it destabilizes investor confidence. This sort of thing is what the Mugabe government has been doing in Zimbabwe and I am dissapointed and allarmed that such a thing could even be considered in Canada. This type of action sows the seeds of economic disaster. The oilsands are potentially one of this nation's greatest assets that could provide the wealth to drive the economy to world leading levels but the resource must be developed when market conditions will support the higher production costs relative to conventional oil (right now). The plants being built today will operate for many years but to make the resource viable into the future we must continue to develop the technologies that will make the cost of production equal to or less than conventional oil and provide an investment climate that incents further development. If you kill this investment just as the oilsands are becoming competitive you may kill it forever. I find it disgraceful that the oilsands mines have been singled out from the rest of mining in canada for this treatment. What principle of good government would allow that?
RRE3510 I think it is time that Albertans.... got their fair share. Klein did nothing but give away our resources for years to big oil. It is now up to Stelmach to correct this and implement all the royalty review panels recommendations. Too [Information Removed]with big oil, let them leave.... where do they think they are going to go? This government needs to show some backbone or get out of office. I for one will not vote for a spineless government if Stelmach does not do the right thing and stand up to big oil. [Information Removed]Klein never did and look at the mess where in.
RRE3511 I support the recommendation of the report which is to increase oil royalties. The report gives the Alberta government another chance to make the right and courageous decision. The government failed last spring when they reviewed the report on housing. I hope they will not fail again. [Information Removed]
RRE3512 I really don't know what is the goal for this report. The title itself leads me to believe it was not objective from the start. The panel is not qualified to form a new royalty structure and most Albertans will benefit less from the new Royalty sceme than before. Who are you kidding by making it sound we will all be better off with higher Royalties. Who gets the money and how will it be spent? WIsely, I doublt it. The decline in investment will more than offset the increase in Royalties. THe panel itself said it does not know what this will mean for investment the future of the oil industry, so who do it? It seems that the panel are about the only ones who feel left out of the economic benefits of the Oil and gas Industry. The trust announcement has already hurt the industry and the effects will be felt in the coming years. The timing of this is way too late to do any good, and will only compound the decline of the industry. But, I can always move back to Houston to work in the Industry again, so this may be a good result.
RRE3513 The royalty rate should increase to put us on par with both British Columbia and Saskatchewan. I would like to see a slowdown in the pace of development of our resources. We shouldn't be having to bring in foreign workers from other countries to meet the crazy pace of development. This shouldn't be about a tax grab but rather an application of some "brakes," to slow the economy down. I see only a few Albertans currently benefiting and the vast majority struggling under increasing costs of living. Why haven't we seen a limit to the length of home mortgages to restrict home pricing?
RRE3514 I think the Alberta government needs to come up with a plan that would benefit all Albertans. With $80/barrel oil we need a larger share of the revenues generated. This is a non-renewable resource that is benefiting all the multi-national oil companies, more than it does the owner (Alberta). If they threaten to pull out of the province, let them. Where do they expect to go? We are sitting on oil reserves that rival Saudi Arabia. When the oil is gone what will our children have to show for it? A large hole in the ground where once stood a town called Fort McMurray?As Premier Stelmach said "a farm without top-soil". [Information Removed]
RRE3515 I support increasing royalties in a way that will be stable but that will also return a reasonable return on a non-renewable resource. To sell to cheaply will deplete the resourse to quickly without adequate compensation for the owners of the resource(Albertans). To raise the rates to high will hurt Alberta's reputation as a stable regime under which to invest. I don't believe we need to be the cheapest place to do business. We are a stable place with an educated and willing work force that is able to service the needs of the investors. We don't also have to be the cheapest place to do business. The problem with waiting to long to make changes is an overheated economy that has put unnecessary pressure on the economy that has hurt ordinary Albertans who are not directly involved in the industry. Affordable housing appears to be a thing of the past. Who except the very wealthy are able to buy a house in Calgary or Edmonton or any of the cities as a result ot the demand that an overheated economy has put on prices. We also must be careful not sit in Alberta with an economy that is the envy of the rest of Canada and not expect them to be jealous which can lead to policy that is disastoruos for Alberta. A steady economy is so much better than a boom and bust economy. Leaving Royalties alone is likely to encourage a run up only to lead to a bigger fall when the resource is used up. We need to invest in technology and the future from the resource we are consuming to today so future Albertans are able to have a stable place to live and work when the royalties start to taper off as a result of the resource having been used up. In summary Albertans should expect and receive a fair share of oil and gas revenue.
RRE3516 The time has come for the Tar Sands to pay their share and stop hiding behind some "I'm still building clause". Also I belive more effort should be placed in Wind, Water & Solar energy.
RRE3517 I agree that Albertans are being short-changed on royalties. The companies extracting oil have placed an enormous social burden on the province which taxpayers are expected to pony up to fix. The environmental impact in terms of water useage is huge and largely unrecognized, and oil and gas are finite resources. Once they are gone the oil companies will pull stakes and leave the province with nothing. We should be collecting a fair royalty, comparable to other oil-producing nations, and investing it wisely against the day when the gas runs out, and then the oil runs out. Some of the money should be invested in Ft. McMurray to build health-care and recreation facilities and to attract doctors and teachers and so on, and some should be put into long-term infrastructure in the rest of the province, hiring teachers and firefighters and police officers who have to deal with the effects of the new wealth in the economy and the drugs and violence that have followed. More should be done to increase the value of the raw material in the province, by upgrading it here instead of in the US. Royalties should be tied to the price of oil, the higher the price the higher the royalties and the lower the price, the lower they royalties. That way we ensure Albertans get a fair share even in unpredictable times. After all, the resources belong to all of us and it is us and our children and our grandchildren who will have to cope with the consequences of our actions now. At the same time, taxes on gasoline should be used to improve the quality of our overburdened roads and public transportation, and invested in alternative energy production (wind and solar).
RRE3518 Sir, I urge you to reconsider the recommendations put forth. I do believe some change is needed but not t to the extent listed. The old saying "if it ain't broke, don't fix it" never said who should decide it's broken. I think some basic assumptions are flawed and the energy sector is not the same as it was 5 years ago and our rising canadian dollar does not appear to be factored into the equation. I ask that you look at all sides of the issue and demonstrate your practical, logical and no-nonsence side or your personality. Thank you.
RRE3519 I am writing to express concerns about the report on royalties titled "Our Fair Share." Numerous errors and the lack of understanding of the oil sands business shown in the report mislead all who read it. It would be irresponsible of the Governme nt to make a decision on this flawed basis. I ask that you delay implementation of all of the recommendations until industry has been properly consulted. I know that the Report's recommendations, if fully implemented, will threaten continuing investment in the Province, and lead to a substantial loss of jobs in Alberta. The report demonstrates a lack of understanding of the forces affecting the bitumen market (pages 79 and 80). It seems to suggest that producers can somehow control the prices and deliberately "spike" the price down to decrease royalty payments. Perhaps you could let the authors know that the bitumen price tends to drop in the winter because of a decrease in demand. The demand decreases because it is hard to pave roads when the ground is frozen. Bitumen is used to make asphalt for roads. It is my understanding that bitumen is often produced at a loss in the winter. Setting the Oil Sands Severance Tax on the WTI price is not a reasonable proposition. Examine the figure on page 80 of the report. It should be apparent that the price differential between WTI and various heavy oils is far from constant. The market for WTI is different than the market for heavy oil. Would you tax oil sands bitumen based on the price of natural gas? Probably not. Taxing bitumen based on the WTI price is no more reasonable. Taxing gross revenue in a low margin business is a harsh proposition even if the tax rate were tied to the correct price. Trying to justify this tax based on administration and compliance issues with the Revenue minus Cost royalty scheme is ludicrous. If, in fact, the Alberta Government does have problems administering and enforcing the royalty scheme, fix the problem instead of penalizing the people who pay the bills. OSST equals no future investment in oil sands. When comparing Alberta with other jurisdictions, the authors of the report fail to consider the relative returns of the projects in these areas. While oil sands projects don't have a high exploration risk, they have enormous capital and market risks. The project costs used in the report are unrealistically low. Not only have the costs risen significantly since the data used in the report was generated, but changes in regulations have added additional future cost burdens. The federal action on climate change will have a significant impact on the feasibility of oil sands projects. Significant investment in technology development is required over the next 2 decades to meet the GHG reductions. It is safe to say that implementation of GHG reduction technology, should it be developed, will come with a high capital and operating cost. The Alberta "Water Conservation for Oilfield Injection" policy is a good tool for conserving Alberta's fresh water resources. The royalty report fails to recognize that the continuously increasing water recycle requirements will have a significant impact on project costs. As an Albertan, I would rather see revenue from the oil sands being spent on water conservation measures and greenhouse gas reduction than on royalty payments. The future of Alberta rests on this decision. I urge the Government to take the time to fully understand the facts so that there will be no doubt that they make a reasonable decision. Convicting the oil and gas companies without fair trial will serve no one. Would a good judge allow a trial to be decided by public opinion without hearing the facts from both sides? Sincerely, [Information Removed] Calgary - Elbow
RRE3520 Where is the "Alberta Adventages" ? We want to encourage investment, not discourage investment. It simply does not make sense to follow the recommendations.
RRE3521 My name is [Information Removed] and I have a small company that operates in the oil pach [Information Removed]. My main revenue is in drilling operations. If oil company profits take a hit such as is suggested, it will result in decreased drilling and the demise of many small companies and jobs in the province. We are lucky to have the Alberta advantage, let's keep it!! As the Government of Alberta, please be responsible with your already incredably high revenues and do not become greedy. This is the best place to live and work because of the oppertunities the oil companies have provided. Don't throw it away. We must allow oil companies to make money in order for them to spend money. Remember Capitolism, the harder you work, the more money you make, the more money you make the more money you spend, the more money you spend, the better the economy. Lets keep a healthy economy. thanks [Information Removed]
RRE3522 My current MLA is Dr. David Swann. So I don't know if he will raise these points or not in the Edmonton. I concerned that you have not included information when you considered the royality issue . THe following are items would like the gov't to consider Gas Business • The proposed changes knock the remaining margin out of conventional/Alberta Basin gas EP. Overview • An industry struggling to be competitive on a world-wide Basis may have the final nail put in the coffin. Report Parameters • The report was conducted by people out of touch with how the gas business really works or how the Basin is actually doing economically (lowest return, to shareholders globally of all producing regions). • The cost data used in the report is significantly out of date. Costs are underestimated by approximately 40% when compared to current Industry actuals. Alberta Gas Supply • The royalty scheme if adopted will drastically reduce the level of future drilling and gas completions, accelerating the current decline of gas deliveries from the Alberta Basin. Short Term Royalty Grabs vs Long Term Production Decline • The decline in gas well drilling and resultant supply decline will reduce the size of the “pie” and have a larger negative financial impact than the increased royalty revenue with-in approximately 2 years. • The government should be encouraging production growth as a source of long term revenue for all Albertans for the longer term and future generations. Total Government Oil and Gas Revenue Considerations • A large new royalty grab by the government will reduce land sale bonuses which are also a huge revenue source. “All Albertans” will not be getting as much more as they thought. Rewarding Mediocrity • Proposed system actually punishes success and to some extent rewards mediocrity. • The 18% highest rate wells carry nearly half the incremental royalty burden proposed. • Rewarding Mediocrity is not what the “Alberta Advantage” is supposed to be about. Actual Gas Price vs Price Used for Public Disclosure • The comment that many lower rate gas wells will pay less royalties is true at the $4.00/mcf gas price level. At prices above $6.00/mcf, a much more realistic long term price, in fact all of the wells will pay higher royalties. • At $7/mcf the prescribed rate moves from 30% on the existing system, to 40% on the proposed system, a 33% increase. At $10/mcf the increase is 67%! Deep Exploration EP • If the Deep Gas Royalty holiday is removed, it will significantly reduce deep drilling in the W5/W6 corridor. • It is portion of the Basin where the long term gas supply will come from, this is where you want to encourage activity. • The Deep Gas Royalty holiday is a long term incentive that has been working very well for over 2 decades. “Who is Being Greedy” • Current government “take” of every “gas petro- dollar” in Alberta is 58%, including royalties, taxes, rents, bonuses etc. • Now the Alberta Government wants to take this to 63%, and still take absolutely no risk. It is actually the Government who is being greedy, not the oil and gas industry. Who you effecting •Entire Oil & Gas Industry in Alberta and Canada • Most of the players in the industry are Albertan based companies, that employ Albertans and spend their money in Alberta. • It is in the service sector and in the field where the impact of reduced activity related to these proposals will be felt first and felt hardest. Their responses to their government representatives are critical. • Unlike many industries, all E+P profits are reinvested creating jobs for many Canadians via drilling activity. Job losses create other negative economic consequences, such as a drop in home prices, and so on. Thank You
RRE3523 The released “Our Fair Share, Report of the Alberta Royalty Review Panel.” I strongly believe the recommendations are not in the best interests of all Albertans, as it does not provide a balance between the concept of “Fair Share” and the economic implications of the recommendations. The report disregards important external factors that affect energy investment in this province such as Finding & Development Costs, Operating Costs and the effects of a strong Canadian dollar. If all of the recommendations in the report were fully implemented as proposed, Alberta’s economy will collapse in a second. This will result Oil Company pulling out from Alberta and massive job loss. You will see me next in line down at the unemployment office. [Information Removed]Geophysical Technologist Devon Canada Corporation
RRE3524 ALBERTANS DESERVE MORE ROYALTIES! The people of this province are working hard in the midst of this "boom", yet we are not being fairly compensated for our labour. We cannot find affordable, secure, and appropriate housing, many of us are not making a living wage, our infrastructure is in dire need of attention, our society suffers many social ills, and our environment is being destroyed by the tarsands. All so the oil companies can make a quick buck. THE OIL IS NOT GOING TO DISAPPEAR. If oil companies are not willing to pay the price our resource is worth, they can look elsewhere. Albertans will not stand by while our land is raped and our social services suffer. OUR GOVERNMENT NEEDS TO TAKE A STAND. Countries such as Venezuela control their oil, and as a result, receive approximately 80% royalties! ALBERTANS DESERVE MORE!
RRE3525 It is unfortunate that for the past few years Albertan's have not been getting their fair share of royalty revenue even though they were being told by their Government that they were. We now know the truth from the Royalty Review Panel! We now know that Albertans have been cheated out of billions of dollars which would have gone a long way to eleviate the problems of the poor and those on fixed income, health care, education, infrastructure, etc.I believe all of the recommendations of the Panel be adopted by the Alberta Government without hesitation. One area of concern still remains related to the one percent gross royalty when production begins until such time costs have been recovered. This is an area of gross abuse by the industry in past years because of the incompetence by the Energy Dept. in ensuring rules are maintained. The big question is "when costs are recovered". Individual oil companies have their own interputation as to what this means and no doubt the 25% rate has been deferred causing millions in loss revenue to the Government. Further, one percent is rediculously low compared to other countries! This kind of treatment is not given to Farmers or the Lumber Industry, why the Oil Companies??? Lets hope the Government will do the right thing now to ensure Albertans get their fair share after many years of hiding the truth from the people of Alberta. [Information Removed]
RRE3526 if the royalty review goes through. i will shut down my oil and gas service company and move to BC. Last year i paid $120,000 in personal taxes and $600,000 in corporate taxes, not to mention property and such....I hope more albertans will do the same , so the goverment looks like fools.
RRE3527 Oil companies have recieved a free ride here for a long time, a 20% increase in royalties is fair.
RRE3528 To say the least, I am flabbergasted by some of the proposed changes to the royalty structure, and particularly the Otherwise Flared Solution Gas (OFSG) program. During my career working as a production and revenue accountant in the oil and gas industry , I reported significant volumes of gas being flared. This was done because the volumes were too small to run a compressor and uneconomical to deliver the gas to market. To clarify, the solution gas produced from oil cannot be flowed to a tank and trucked out. It must be pipelined to a gathering line and also have enough pressure to enter that line. For that reason, much of the gas produced was more of a nuisance that had to be disposed of, and therefor it was flared. As an environmentally concerned Albertan, I was thrilled when the OFSG royalty exemption program was implemented by Alberta Energy. It made the producers re-examine their existing production practices and innovative solutions were implemented to capture the gas in a beneficial manner. The benefit to all Albertans is the reduction of emissions polluting the air we breathe, which is very important in my opinion. No royalties were being collected for flared gas before the implementation of OFSG, and no royalty is being assessed now, so it is "revenue neutral". In other words there is no loss of revenue to Albertans regarding this program but there are serious implications to the environment.
RRE3529 There is a lot of press over this "Fair Share" and a lot of different opinions on this issue. T hope that the recommendtaions are not implemented in it's entirety as I do think there could be a middle ground resolutuion. I just hope that more in depth study be done to take a look at what affect it will have on the Alberta economy as a whole not just "our fair share". I would like to see a proper panel look at this with up to date data and proper comparisons. Let's not rush into things. Let's do a proper assessment. All we have to look at is the mid 1980's and the NEP. This will affect all Albertans not just the people employed in the oil and gas business. I think the majority of Albertans do not see this as they think the "Big Oil and Gas" would only be affected.
RRE3530 I have heard both sides of this issue and it has become painfully obvious to me that the Royalty Review has left many questions regarding Alberta's future hanging in the balance. I hope the government has had an unbiased appproach to this subject and can see that there are severe repercussions to making the wrong decision in this matter. The existing royalty system has served this province well, we have all benefitted as Albertans in the current system, and as a result of that the country as a whole is flourishing from our successes. Please be sure that the decisions made from the suggestions made in the Royalty Review do not jeopardize this. I am sure there is room to make changes that will benefit everyone, but the changes suggested through the royalty review in full would cripple Alberta's economy, there is no doubt in that. I have read that there is an issue of pride involved in coming up with the right choice for Alberta. Please remember what made our province so bountiful in the past 10 years and do not cripple the industry that has made Alberta such a great and prosperous province. Thank you, [Information Removed]
RRE3531 I am greatly concerned with the consequences to Albertans, and especially how these consequences will affect the citizens in the Grande Prairie area, which will occur if the recommendations of this report are adopted. In the recent weeks, I have taken it upon myself to read all the information available regarding this topic and have found some extremely problematic issues with the Panels review, headed by Bill Hunter. The report contains inaccurate and contains factually incorrect information, these inaccuracies have led to recommendations that will have severe consequences, especially to the people of Grande Prairie and the Alberta Peace Region. Effectively, these recommendations will increase royalty rates past the point that makes oil and gas extraction in the province economically viable. Therefore, the adoption of the Panel’s proposals will have negative consequences in terms of an economic downturn in Alberta and reduced development of Alberta’s oil and natural gas resources, which factors prominently in the Grande Prairie area. Some of the other problems in the report are listed below, but are not limited to the following. The Panels proposals also do not properly evalnd high cost basin of the Alberta oil and gas industry. This will affect gas producing areas, like Grande Prairie, the most by increasing the royalties past the wells economically viable production levels. In addition, there appears to be inconsistencies regarding the increases in royalties in the massage that has been delivered to the people of Alberta. Upon investigation the Panels 20% increase in royalties appears to be far greater in reality (and in consideration of the previously mentioned issues). I agree that royalty rates should change, and that all of us should benefit, but the panel report is wrong and their recommendations are going to cost us severely. I am seriously concerned for my family, my future, and what life will be like in the very near future. I am also worried about those I work with, contractors, friends, neighbors, the community, and every other Albertan if the Panel’s recommendations are adopted. Please ensure that the Panel’s proposals are carefully examined and determine a path forward that balances the need for Albertans to retain a fair share of revenues while maintaining a viable oil and natural gas industry that can continue to contribute to a prosperous Alberta for generations to come.
RRE3532 I have been a [Information Removed]in the Province of Alberta for over 20 years and an Alberta resident for over 40 years so I feel I can provide some form of balanced feedback. As an [Information Removed], my specialty has been the identification of drilling opportunities that would hopefully result in the "prolific" catagory of well of which the Royalty Review Panel would like to see a much higher royalty. Upon reading the report, I was very surprised because as a current [Information Removed]and well in touch with the current business environment, I actually thought that the government needed to put in a royalty holiday to try and stimulate activity for new conventional oil and gas field discoveries. These relatively clean fuels are economically and environmentally superior to the oil sands product but they are very difficult to find and thus very difficult to finance. The investors in my projects are there because they need to know that if we do find a field, they will be very well rewarded as their usual outcome is a "dry hole" in most cases ( the probablity of success for a [Information Removed]is generally less than 20% in the Province of Alberta). My concern is that if the royalty adjustment occurs, my investors do not care where I drill. They only look at the rate of return on the projects and if that project is in British Columbia or Saskatchewan or offshore Newfoundland, they are ambivalent. I would like to think that I have another 15 to 20 years of [Information Removed]to conduct and I would like to continue to employ Albertans and contribute to the flow of weath to myself and my fellow Albertans . If the Government would like to discuss this further with me, I would be more than happy to share additional thoughts. Thank you [Information Removed]
RRE3533 I don't understand why a province that has 0 debt finds it necessary to impose this Royalty Review. The ramifications go much deeper than just future job cuts, oil companies also donate huge sums of money to countless charities. I would like to hear the premier's explanation to needy Albertans when charities start cutting services due to lack of funding. Albertans each have already received a $400 cheque are we to expect a larger one after this Royalty Review? Seems to me we are starting to get paid just to live in the province. To say the Premier is short sighted in his approach to the Royalty Review is an under statement
RRE3534 To whom it may Concern. After listening to the much talked about Royalty review report, It's without a doubt that the Alberta Advantage is heading from the Penthouse to the outhouse. Thou I agree with an increase of the royalty structure, however should the GOA continue down the path choosen, I hope our sake and the childen's sake that there is a future in Alberta. Its surely looks like a deal can be reached over a period of time, if in fact the review techincal team gets it right, by doing their dudelegence and also using experts such as Tristone Capital, to save our province. And by the way does this panel have a crystal ball and the correct formula to predict the real costs analasist. It would appear that many dollars are preparing to leave Alberta. Brain drain, and welcome Social Services. Hello Liberals. Good job Hunter. Our reputation Nationally and Globally is at question and it should be.
RRE3535 The Alberta Government definitely needs to increase Royalty rates. The oil companies won't go anywhere else and if they do someone else will quickly come in and fill the spot and pay us what we deserve. Our economy has boomed, that is true, however, at a terrible cost to Albertans in terms of affordable housing and rent, traffic congestion, infrastructure problems, and access to social and medical services. What about the marginal groups such as immigrants, children in need, lower income families, who are barely struggling to survive in our economically inflated province. The growth has not been properly managed but if we can put the oil companies on the hook for repairing some of the damage, all the better for Albertans. Do the right thing Mr. Premier, and raise the royalty rates to ensure Alberta and its citizens a more secure life and future.
RRE3536 I think it's become quite evident that much of the data the panel used is flawed, and thus the recommendations are also flawed. Specifically, the cost side of the equation. Margins on most wells are low as it is. I fear that implementing these recommendations will seriously damage the entire industry, as already being evident by the layoffs in the field. In the end, the entire Alberta economy will suffer, and will actually result in reduced royalties due to less activity. Do not implement these recommendations without first getting industry to open up their books and verifying the data.
RRE3537 Please don't let corporations such as Encana bully our government from making sound decisions. As an Albertan, I am okay with these companies reducing their manic spending in our province. These companies will want always desperately want our oil, whether it is sooner or later, and no amount of bluffing can convince me otherwise. We need to stop giving away our resources and revenues, and we depend on our government to protect the interests of the PEOPLE of the province.
RRE3538 One positive effect of raising royalties that seems to be somewhat overlooked is that it acts like the fed raising interest rates...it slows that sector of the economy. This is a criticaly necessary step that must be taken until a) infrastructure can catch up b) environmental issues are dealt with c) production technology becomes more efficient. The current labor climate in Alberta has gotten out of control. Why not slow down a little? Most of us would be thrilled to be able to hire a contractor in a resonable time frame, drive on roads that aren't overcrowded, keep staff in our small businesses. I'm not suggesting a huge clawing back of the industry, just a bit of a speed bump to slow it down.
RRE3539 Don't let the oil companies bully the people of Alberta. we own the resource and the oil companies make the money. It has to change or do we have to change the government
RRE3540 Thank you for the opportunity to provide feedback on the Royalty Review. This is an indication of the government's stated direction of openness and transparency. First, I would like to highlight two of the government's focus areas: manage growth pressures, and sustain a high quality of life. For the average Albertan, the unprecidented growth of our economy as resulted in a higher quality of life but we are definately at a stage of diminishing returns. The growth pressures has taken tolls on the environment and infrastructure in that we are unable to keep pace with the economy. The cost of construction of water/wastewater pipelines and roads has grown significantly such that there are communities that are unable to get the infrastructure that they need because of the escalating costs. We need to maintain the royalty change at the MINIMUM of what was recommended (nothing less). I recognize that the oil industry is concerned that this creates uncertainty and a slightly less favourable conditions for industry, however, the benefit to Albertans is far outweighed by the increased revenue and what that revenue could do. If we focus that revenue specifically on areas where more strategic action is needed for the energy sector, then that may be slightly more palatable for Albertans and the energy sector. For instance, a CO2 pipeline will not likely be built by industry but the increased royalties will be able to fund this pipeline to the betterment of all Albertans and Canadians. Another example is to have greater funding of infrastructure (water, wastewater, roads, schools, etc.) for areas that have undergone significant growth and possibly for strategic areas like the industrial heartland and similar instances where industry won't take the risk of doing it alone and communal infrastructure would benefit industry and Albertans. The effects of a shrinking economy won't likely be significant if the royalty rate is slightly increased. Indeed, the resources will eventually be removed either quickly as fast as possible or at a slightly slower rate. The opinions of the general public (Albertans) is clear in that growth should be slowed slightly. The purpose of government is to provide assurance, facilitation and infrastructure. The general public is the customer of the government with the public interest in mind. With the increase in royalty it is expected that the government will be in a better position to fulfil its mandate and (with the suggestions above) provide infrastructure and facilitate continued and more strategic growth. [Information Removed] P.S. I don't need a response but would like my comments given appropriate consideration.
RRE3541 As a geologist active in oil and gas exploration for 44 years, I am concerned about the royalty increases recommended by the Alberta Royalty Review Panel. I fear that if they are implemented, they will cause immense damage to the industry and to Alberta’s economy. I note: Oil prices are at a peak and are more likely to decline than to remain high. Gas prices are in decline now. Alberta’s conventional oil production is well into decline and practically all current oil exploration is being done by small independents. Royalties on conventional oil production should be lowered-not raised, to encourage exploration for the remaining smaller prospects and to encourage use of costly secondary recovery techniques to maximize oil recovery from the currently producing fields. Alberta’s conventional exploration for gas is focussed on two objectives, a) deep foothills prospects, and b) coal-bed methane, both costly endeavours with considerable risk and facing a declining product value at this time. Activity levels are presently in decline and a gas royalty increase will cause further decline. Alberta’s tar-sands development is a totally different enterprise from conventional oil and gas exploration, involving no exploration risk, but high costs per barrel of oil output that is in no way comparable to oil production in the North Sea or the Middle East. Taxation regimes at those locales have no relevance to Alberta’s tar-sands and the Royalty Review Panel’s apparent failure to recognize this fact renders flawed and moot it’s recommendations here. A conventional ‘net profits’ tax, designed to reward efficiency and innovation would be the logical way to proceed. The present royalty regime is working well and spinning huge sums of money into Alberta’s treasury and the economy. Any further attempt to increase the provincial take could invoke a federal response to ‘get their fair share’ as happened (with disastrous consequences) when the province jumped royalties in the 1980’s. If it ain’t broke, why fix it??? Further, I am concerned with the Premier Stelmach’s promise to respond ‘within a month’ to this complex issue so critical to Alberta’s future. That’s not enough time to review the Panel’s (flawed) recommendations, confer with relevant parties and make a reasoned decision on how to proceed. Does he truly understand the situation? [Information Removed]
RRE3542 Please use prudence in making your decision on the royalty review. I do agree that there should be some kind of adjustment. However let's look at all the ramifications prior to making a hasty decision. Firstly how will this effect ALL service related businesses.As well as how will it effect employment and long term investment. Alberta does not need to create its' own NEP. Do the right thing, our economy drives the whole country. Do not stop that engine. Tune it up. Regards [Information Removed]
RRE3543 What is the government's option for employment if a large portion of the oil industry pulls out of Alberta. We must remember that we are not the only place on the planet that has oil and gas. The companies are here because of being able to afford operating costs and the fact we have very experienced people in the industry. Do we want to lose both the companies and the experience. Better get it right!!!!!!
RRE3544 I would first like to say that I am a supporter of the Conservative Party and am a proud Albertan. I am also a young professional working in downtown Calgary [Information Removed]. I have taken allot of time to review the "Our Fair Share" report, the local news papers, the independent reports from financial institutions, and the warnings issued by the Energy Industry. One of the primary responsibilities of my job includes working with a team of engineers and geologists to develop exploration strategies with regard to posting and bidding on crown owned mineral rights. After reading the report I was astonished to learn that the Landsale bonus amounts were not included in the report. In 2006 industry paid $3.5 Billion in landsale bonuses to the Alberta government! I'm sure you would agree this is significant! In 2007 landsale bonuses will contribute much less as a result of less favourable economics due to low natural gas prices and high operating costs. If the royalties on conventional gas were to increase in today's environment that bonus will undoubtedly drop more…perhaps to a point that the $2 billion to be gained would be lost in land bonuses alone (not to mention less drilling). I have worked for several large firms for the past 5 years and the common theme is "it continually costs more to find less in Canada" and the ever increasing complexity of rules, regulations, landowner issues, aboriginal issues keep cutting into the bottom line and puts Alberta at a competitive disadvantage. Multinational oil giants like ExxonMobil have just about stopped exploring for conventional oil and gas in Alberta since 2000 because they have the world to choose from and conventional Alberta just doesn't make sense anymore. I implore to consider this issue very carefully and to take your time to make the correct decision. I find the public opinion poles very disturbing which I believe is the fault of industry and the government not properly educating the public….and of course the media distorting the truth - we need to learn from this. Unfortunately the result is that the Conservative Party must make changes or risk losing allot of votes. In my professional opinion, based on 5 years of sitting in meetings discussing the economic potential of exploration plays, I believe a balance can be struck if the government raises royalties but uses a net profits calculation instead of gross revenue, raises royalties on Oilsands (but not the punitive severance tax) and grandfather existing arrangements….we would look like a third world banana republic if we changed the rules after the fact…very embarrassing….analogous to Venezuela... I know you will do the right thing, please make your own decisions based on facts and what you know is right...not anything else.
RRE3545 I believe the higher royalties is going to be devasting to our economy, and i couldn't think of a worse time to implement such strategies with the dollar as high as it is. There are going to be hundreds if not thousands of private contractors that work in the oil and gas industry that will be severly effected by the higher royalties, due to the fact that alot of oil & Gas companies will cut drilling and exploration projects. Higher taxation of the oil sands and higher environmental standards are needed in these projects i believe, but to increase royalties across the board seems a little much. We should have as a province took over the oil sands projects for ourselves instead of letting private enterprise have such control of a considerable resource that could be the provinces. I work in the oil & gas industry as a private contracter and i am already feeling the effects of the higher dollar and the royalties are only going to compound the problem for me and many Albertan families that are in the oil patch. I truly hope there are many more people writing in to share there fears and concerns on this topic and im sure our responsible government will find a better strategy they could implement.
RRE3546 I think it's time for another election and see what We (Albertans) Think of this situation. Oh yah Ed I hope your there when i need to make payments next Month!
RRE3547 Dear Premier Stelmach: As an Albertan, I would like to express my support for the recommendations provided by the Royalty Review Panel. While businesses have referred to these recommendations as "draconian" and "extreme", I actually consider them to be quite accomodating for businesses, considering the cost on Alberta's infrastructure and social systems (ie. housing shortages). While I am pleased to see an recommendation in the increase of the base royalty rate to 33 percent (moving the total share to about 40 percent), I would fully support the government asking for more. My understanding is that other countries like Norway and Venezuela are obtaining 78 and 90 percent respectively. There is no shortage of interest in companies accessing their oil reserves. We all know that the current world structure is dependent on oil, and that this resource is non-renewable, so I would hope that the government would plan for the future of Alberta past the 4 year election timeline that many governments in the past have done. This province will need to invest in new technologies and industries when our oil is gone, and to do that, we will need resources and capital. We will need educated Albertans. We will need a community with strong social capital and a shared vision. And, all of this deserves government support. I, for one, intend to support a government that represents the interests of all Albertans, both those living here now, and those living here in the future. I urge the Albertan government to not "compromise" on their recommendations in their report, and in fact, consider something even stronger to assure a postive and successful future for Albertans. Sincerely, [Information Removed]
RRE3548 Dear Mr. Premier, Please don't let big oil dictate the course of action on this important issue. Your review panel has done the review with all the pertinent facts. Follow through on all of the recommendations. It is unbelievable that a company like Encana with 6.5 billion in profits (in one year) is trying to blackmail the people of Alberta with there negative comments. Regards [Information Removed]
RRE3549 Please consider the amount of investment service companies have committed to the heavy oil sector in N. Alberta. If the new royalty structure is detrimental to further development in the region, more than just "big oil" will be affected.
RRE3550 These proposals are wrong on so many different levels. I don’t have time to explain why but I do believe if the province goes through with the royalty hikes that I will have nothing but time. I think that Bill Hunter should be fired for incompetence.
RRE3551 I am an American and realize the incredible growth in wealth Alberta has experienced in the last 5-10 years. Alberta is debt free and could potentially exhibit the highest quality of life on this planet. Why would you ever want to impede the industry that is almost soley responsible for this created wealth? All Albertans must realize that wether they like it or not they are most certainly tied to the performance of the heavy oil sector of this industry. So my summary comment is - don't kill the goose that is laying all the gold eggs.
RRE3552 My belief is that the report is short-sighted, and it would be foolish to think that changing the royalty structure at this point would not have a severe impact on activity in the oilfield. My extended family of over 40 people all rely on the oil industry for our economic well-being. My husband and I have lived through two economic crashes already because of some short-sighted regulations imposed on this industry, without any recognition of the consequences. But we are too old to recover economically should this happen again. Please think long and hard about implementing the recommendations of the report as presented.
RRE3553 I wish to convey my deepest concern over the possibility of oil & gas royalties being increased. Alberta does very well, as evidenced by the huge amount of money collected every year in royalties, and that doesn't include all the municipal taxes, land sale revenue, lease rentals, not to mention income taxes. The business is extremely competitive, with wide swings in commodity prices. Companies cannot be expected to invest in high risk ventures without some expectation of reasonable return on that investment. If Alberta doesn't want the investment, believe it - others do! Why in the world would you even consider risking the good business environment we have at present. Companies are already announcing huge investment cuts - or diversions, because the investment will happen, just not in Alberta. This reminds me all to much of the National Energy Program of the 1980's. That program based purely on greed brought this province to it's knees before it was finally cancelled. We really don't need to go through that again! Wake up people - if you eat the cow, the milk stops flowing!! [Information Removed], Calgary
RRE3554 The oil industry has caused house prices to double in the last few years. They can now share some of their profits with the people of alberta to make housing more affordable. If 20 percent is too much how about 15 percent.
RRE3555 Most people in Alberta have worked in the oil and gas industry for most of their lives. They have basically depended on this work to enjoy the fruits of their labour. Spending months upon months away from home to have a comfortable life style away from work with friends and family. This royalty review will kill the Alberta economy and the so called Alberta Advantage. Ed Stelmack should listen to the public on this one. Mabey call Ralph Klein for a tutorial on how to be a premier. This is more of greed than anything else. The results will be more than Stelmack has even thought of. Disgusting for a premier that was born and raised in Alberta.
RRE3556 It is my opinion that the Government should fully and immediately implement the recommendations in the report. The oil and gas industry doom and gloom message is simply highly paid CEOs and lobbyists doing what they are paid to do: make money for their companies. Not implementing this report is grounds for voting in a different Government.
RRE3557 How can our gov't think, that less wells drilled will equal more royalties. The large players, WILL move elseware!Look at this thing from the other side. Listen to what the companies are telling you!!! The numbers used to generate this report, will NEVER be seen again, even if this does not go through, has that been thought of! In a time of labor shortages in Alberta, our own gov't want to push the work to neighboring prov. or worse yet to other countries. It's hard to believe that this Gov't at this stage of the game would try to accomplish the same thing that was done in the 80's. we have seen what will happen, RE-THINK IT AND GET IT RIGHT!!!!!!
RRE3558 Dear Mr. Stelmach: Please take serious consideration into the likely effect on the rural communities where the oil and gas activities are located. As the oil companies are saying many of the wells will deem to be uneconomic, the livelihood of those families will be adversely affected. Also, I think the new royalty calculation has to be fair to everybody. I wonder if the formula of calculating the cost has taken into consideration of the vulnerability, the risk factor of the industry, and the global competitiveness etc. Please reconsider and make sure it is fair. Thank you very much. Regards, [Information Removed]
RRE3559 Please take the time to work this out with the industry. There is a common ground to be found. We all count on the prosperity that we currently take for granted in this province. Lower industry domestic capital budgets will hurt us all.
RRE3560 Please raise the Royalty rates by AT LEAST 40%. I am outraged by the threats made by oil companies and I strongly believe that our response should be to raise our royalty rates even more to send them a clear message. "Albertans won't be bullied!" What's the worst that can happen? Perhaps a little cooling of an overheated economy? I doubt it. Give the oil companies a long term commitment (so they can plan) but send a clear message that Albertans won't be bullied by oil companies making record profits. We want our share! This is one of the few opportunities Albertans have to level the playing field. Don't worry, at these prices there will still be plenty of companies willing to develop our resources. [Information Removed]
RRE3561 I have just reread the report on royalties; after reading comments from companies, newspapers and blogs I have come to the following conclusion: Alberta seems to have agreed that the oil sands, conventional oil and gas will continue to be run by private companies. The defacto result however, is the nationalization of the Alberta energy industry. As in Mexico and Venezuela output will fall. The increase in royalties will make the major oil and gas producers into utilities with little or no growth. Some investors will stay if their cost base is low. Little or no new money will come into Alberta energy companies. Revenue (adjusted for inflation) to Alberta, will begin to decline despite rising oil prices. Is this what you want?
RRE3562 can't happen, energy companies will find a more economical place to drill for oil/gas if all the government wants to do is take a bigger piece of the pie. Do they not realize the pie will get smaller!!! Devestating to think these are the people that are supposed to be looking after the people of Alberta.
RRE3563 The oil industry provides the Alberta economy with substantial revenues already. As with anything new, everyone needs time to digest change. A 20% increase in anything in one lump sum is pretty hard to swallow. I believe if the province really thinks it needs more funds this must be phased in over time.
RRE3564 This report was long overdue! Alberta's boom has financially made things worse because, I am senior and have a fixed income. The cost are going skyhigh in Edmonton, and the reason is to do with the growth. The Alberta Government has huge surpluses, but the two large Alberta cities are suffering. I don't understand stand why our Alberta government doesn't do something to slow the economy down. The price of oil and gas keeps going up, and their profits are huge because of an outdated Royalties. This province has the lowest royalty rates in the world. What is wrong with Our Government!
RRE3565 Don't kill the goose who laid the Golden Egg. I am retired and am enjoying the good life, much to the credit of oil stocks. Children work at oil related jobs. I and my family have voted conservative all our lifes, don't change that.
RRE3566 Having worked in the oil for close to 50 yrs I new exactly what the response would be from the oil companies.I have lived through 7 or 8 of these interference problems and only lost my job once.You must remember that you are dealing with people and not really oil companies.Naturally they will protect their den( shareholders etc) If you implement the new royalties as recomended by the royalty report you will not have an extra 2 B $ but will be short by that much.You may win the election but will kill the goose that has laid the golden egg. I would suggest that you play the game and raise the royalties in a gradual time frame so that the companies can work their economics on their projects. You will still loose some major players.The big problem is the price of gas and oil and this should be figured in the increase formula. You guys have put yourselves between a rig and a hard place and the only way out is by going on an inbetween road. Best of luck , [Information Removed]
RRE3567 Mr. Stelmack, As you are probably aware, the review is flawed in many respects. We do need to increase royalties marginally but not to the extent to disinsent investment. Most notably, we have to encourage deep gas drilling. Let's not screw up a good thing and cook the golden goose. Sincerely, [Information Removed]
RRE3568 I am concerned about the amount of royalties increased willslow down construction and development and put a lot of people out of construction jobs and increase unemployment. We need to increase royalties but ensure a strong enviroment to continue employment and work for all Albertans. What ever is considered for increases possibly a ramping of rates over time will be better than a large increase suddenly hitting the industry. Thank you for hearing my concern. Have a great Day.
RRE3569 I am making these comments as a private individual, not an employee of [Information Removed]. First off, I'd like to congratulate the royalty review panel on a thoroughly researched document with largely sound recommendations. Second, please keep in mind that our legal framework compels corporations to look out for the value of their shareholders. It is therefore necessary for them to oppose these royalty changes as they will undoubtedly reduce shareholder value. Corporations have no responsibility to act in the public interest, therefore it is particularly important that government not be unduly influenced by their rhetoric. Costs of production in Alberta are out of line with those in the rest of the world, due partly to our geology, and partly to our overheated labour market. I would hope that one of the aims of these royalty adjustments is to calm the inflationary environment in Alberta. However, I'm not sure that the panel has been realistic about the levels of cost in this market, even considering that some cooling will take place after the royalty changes are made. Test the panel's assumptions about cost, especially in the Fort McMurray region, where it is becoming harder and harder to recruit and retain a quality workforce due to lowering living standards in town and the profusion of employment opportunities. Costs in this area are likely to continue rising, unless we see a drastic reduction in the level of activity, which would not be desirable for Albertans. I believe the recommended royalty changes will cause a modest, not a drastic slowdown in oilsands activity, so at best they will result in a modest moderation of costs. Politically, it would do the panel (and the government in general) well to educate the public on the nature of the relationship between the government and the oil companies. Many oil companies are publicizing the view that the existing royalty regime was a contract with Alberta that is unethical to change. The truth, I believe, is that the royalties are subject to review and change on a yearly basis and thus are more comparable to a rental agreement - subject to change based on market conditions. It is hard to believe that an oil executive would counsel a landlord that they cannot in good conscience raise their rents, yet they are complaining vociferously that the government of Alberta should not raise their rents. Given my first point, these complaints are easy to understand - they are actually compelled by law to complain. Clearly, changes are required for Alberta to extract a competitive value from their non-renewable resources. But ,be realistic about the cost environment we are living in - some of the thresholds in the report may need modification. Regards, [Information Removed].
RRE3570 The resource belongs to all Albertans and any royalty regime has to be fair to Albertans, industry and other stake holders. Having stated this, it needs to be understood that a big piece of the discrepancy between the industry position and the Royalty Panel's position is likely caused by industry using a long term crude price assumption of $50US to $55US as the planning basis to evaluate O&G projects and the Royalty Panel and the Auditor General likely looking at the $70US to $80US plus price that is in existence these days. The difference between the 2 sets of prices would have a significant impact on the economics of O&G projects. For oilsands projects specifically (which have a long time horizon, long lead times and heavy upfront costs and significant operating cost & sustaining capital expenditures) it would not be fair to use today's price in the economic evaluation. Also, the tremendous cost increases that have taken place in recent years have likely been under-estimated in the Royalty Panel's analysis. I would urge the Alberta Government to consider these issues carefully in it's evaluation of potential changes that it would be looking at making to the royalty regime that is currently in place.
RRE3571 Does the National Energy Program mean anything to you guys? Hoe about the eighties? You're going to CRUSH oue economy if you go through with these hikes! If ther ever was a case of shooting the goose that laid the golden egg, that would be it. We are already starting to feel the effects in the housing mareket with just the idea going around. Not a good legacy for the new premier and his cabinet to leave behind just when Alberta was prospering! I am a conservative but I could see aLiberal government coming to power if you guys [Expletive] this one up.
RRE3572 I think a review of the Royaly regime was long overdue. My biggest concern is the magnitude of the changes you are contemplating implementing based on what I believe is flawed and simplistic assumptions. The Canadian oil industry is unique and not easily open for comparison to other countries royalty structures. I think further industry input and consideration is essential before implementing such large scale changes.
RRE3573 Oil & Gas Multinationals remain in operation in Venezuela, Bolivia, Somalia, Iraq, Iran,Nigeria. These all countries which appear on the face of it to put the revenues of the Oil & Gas Multinationals at risk. That they have not closed operations in those countries is indicative of how much money they are making and the levels of risk they consider to be worth while. Alberta is a safe secure place for the oil & gas multinationals to operate in, so no matter how much they object to paying an increase in Royalties to Albertans (the people who own the resource they dervives so much money from) the oil & gas multinationals will not withdraw from this province. Do not give in to them. If you do so you will betray your electorate.
RRE3574 Given the current state of the oil & gas industry, I am against implementing any significant changes to the royalty structure. The industry is much weaker than people understand, and increasing costs cannot have any positive affects for the people of Alberta. Neither in producing more tax revenue for the government or for the pocket of Albertans. Hopefully, fellow Albertans wont figure this out too late.
RRE3575 Implementing the recommendations of the Royalty Review Panel will have a catastrophic effect on the economy of Alberta. Within my range of acquaintances and friends of friends, there are more that a dozen who have been told to prepare for layoffs and major cutbacks, if the recommendations of the Review Panel are implented in the current form. What guarantee is there that the increase in the Government's income from Royalty payment will be used to help those that lose income due to the changes? Please understand that I am not speaking of executives and higher level managers, but the well planner who is making under $50,000 per annum, or the office cleaner who will lose their minimum wage job because of office closures. While I agree there needs to be changes made to the Royalty structure, the Review Panel needs to take into account the factual costs affecting the industry at the current time. Significantly changing and increasing royalty rates in the current economic environment and with the escalating costs facing the oil and gas industry will have a negative impact the likes of which haven't been seen since the National Energy Program.
RRE3576 I feel that the government has a great opportunity to be a leader at this time and provide a win-win situation for the people of alberta and industry There are several issues that the panel nor the auditor general talked about such as value-added, land issues, etc. that will come up in the near future that will bring up the subject of royalties again and again. If these issues could be addressed at the same time as you are responding to this report, it could reframe the question from "are we getting our fair share" to How are we keeping Albertans interests now and in the future economically sound? The numbers would all be looked at differently and it wouldn't make anyone look like someone won and someone lost. It would just show that you took the report but took a leadership role and went one step further to add value-added and solve future issues before they come up quickly. Albertans with their free enterprise economic system have been the envy of the world and have always lbeen looked at as a leader in how to create wealth, not just get bogged down in comparisions with others not as wealthy or with different schemes of redistribution of that wealth. I think if you have a good justification for whatever you do, Albertans are intelligent enough to see beyond what seems expedient and what is really for the good of all albertans (those who benefit directly from oil and gas and all of us who benefit indirectly.)good luck.
RRE3577 Good Afternoon: as a concerned citizen of Alberta and a consultant to Oil & Gas projects the out come of the "Royality Review "may effect my futrue work in this industy, So from my prospective I would like to send a message of caution on the part of the government when considering incresses of the royality tax . I understand we as tax payers would like to levrage every cent we can get out of the resource but we must allow industry to make a fair and resonable profit for the risk they take on behalf of shareholders and investors of there companies. I am sure after reading many reports produced by companies that there read on paying more in royalities is some what in there best intrest but I also belive the report by the review panal has some questionable information as well. In closing I hope that the final out come is a fair deal for both sides and thier is no dought that some companies will cry fowal as they would like things to stay as is but like most times when taxes increass we and they will find a way to go forward . thankyou for your time in reading my message [Information Removed] Calgary Alberta
RRE3578 September 20, 2007 Honourable Ed. Stelmach, Premier of Alberta Office of the Premier Room 307, Legislature Building 10800-97th Avenue Edmonton, Alberta T5K 2B6 Honourable Lyle Oberg, Provincial Treasurer of Alberta Legislature Building 10800-97th Avenue Edmonton, Alberta T5K 2B6 Dear Honourable Sirs: RE: Our Fair Share – Report of the Alberta Royalty Review Panel We have had the opportunity to review, at first blush, the above captioned report. While we agree with the spirit of the report, which seems to be to get a fair share of royalty resources for Alberta and Albertans (which includes the writer), the ultimately thrust of it seems to be significantly counterproductive. Our analysis indicates that petroleum and natural gas producers stand to see a 50% increase in royalty rates. We believe that is unlikely to impact those facilities which are currently constructed and producing. But the impact on new work will be very significant. Frankly, we would suggest that the impact of these royalty hikes would amount to “regimen change” – that would destabilize and make significantly uncertain to a degree which investment in Alberta’s natural gas and petrochemical resources would be put. New work would dry up as effectively as it did when the National Energy Plan was put in place in the 80’s. One side benefit out of that is we would probably no longer see significant shortages of tradespeople. Rather, we would have the same state of affairs that obtained after the National Energy Plan was put into effect, large numbers of highly skilled traded people being out of work. There is not doubt that Albertans need and want oil royalties to deliver infrastructure, health and social benefits and to militate the effects of unparalleled growth; these are not unreasonable expectations; by the same token, there needs to be both incentive and sustained stability for producers. Balance is required in any taxing regimen. Somewhere between the report and the producers “taking their hall and going home” is an answer that ought to satisfy all the interests; we acknowledge that there is no answer short of 100% my position that will be satisfy every party. There are ways to manage growth, infrastructure and ensure that a fair share is paid by the developers of industrial concerns in Alberta. For example, if a producer wishes to export bitumen (and the value added jobs that go with it) charge significantly higher royalties as well as rewarding Alberta producers with the “upgrader royalty credit”. Royalties could be raised in a manner that won’t kill jobs. A royalty could easily be placed using a benchmark and taking an additional royalty on oil above that price ie. an additional royalty for oil above, say $60.00 a barrel. [Information Removed] A significant number of those workers are resident in the province of Alberta while a considerable number of others, while resident elsewhere, perform work on a regular basis within or for Alberta. The jobs in the oil and gas industry in Alberta ceased to be simply Alberta jobs a long time ago and have become part of a national mobile workforce. These are Canadian jobs and we would ask that you do not take steps which would have the next effect of killing these jobs. Using royalties to regulate growth in the oil / gas industry is clearly inappropriate. [Information Removed], we would like to have the opportunity to meet with at your earliest possible convenience. We are stakeholders in this province, persons who’s jobs are dependent on the continuance of the work in the oil sands, oil patch and natural gas industries and believe that our views are as valid as any other major stakeholder group. I indicated to you at the commencement of this letter that these comments are at first blush. We are continuing our analysis of the policy and would specifically reserve the right to make more complete and fulsome representation as the analysis becomes available. Thank you for your attention to this matter please do not hesitate to contact me should you wish to discuss this matter further. I remain, Yours truly, [Information Removed]
RRE3579 Why can't good things be left alone? Why does the government have to stick their nose in everything? A lot of investing has been, and is being put into Northern Alberta's oilsands; don't you realize companies arent putting money into area where returns are quick? Why do you have to mess with percentages, do you know or care what impact this royalty change is going to have on Cdn business? let alone stall any growth in alberta now ... or wait - maybe that is what it is you're trying to do. please leave things as they are, don't scare investors away, don't force longer backpacks for oil&gas operators. My kids will need the sands to earn their living. Don't mess it up...
RRE3580 As a worker involved in the deep gas plays south of Grande Praire, I have witnessed millions of dollars spent on unsuccessful drilling results. Oil companies have to absorb the risks and require a stable regulatory environment in order to weigh risk and reward. Do not change royalty programs in this low natural gas price cycle as this will hurt thousands of people involved in the exploration of deep gas.
RRE3581 I have been involved in the oil and gas business in Alberta in several different capacities for [Information Removed]years. I have reviewed in detail the recommendations of the Royalty Review Panel and conclude that the recommendations as presented by the panel are either purposely misleading or based upon incorrect information. If adopted the results will be similar to the NEP of the 1980's. I have also been a member of the Alberta Conservative party for most of the past [Information Removed]years and am genuinely disappointed that my government would even consider adopting the panel's recommendations. Although many Albertan's have taken the short term view that a substantial increase in royalties would be of benefit to them, I can only wonder who they will hold accountable when their home values drop by 50% and their children cannot get good jobs as occurred following the NEP. This is definitely nut cutting time for our leaders and I for one hope that I do not have to witness unelected politicians walking around with squeaky voices.
RRE3582 Oil & Gas Royalty review
RRE3583 We should absolutely charge oil companies many times more than we do now for extraction of our non-renewable resource. We should also be charging them waaaay more than we do for water.
RRE3584 This review has been long overdue. Former Premier Lougheed, who set the rates back in the 70's, himself called for a review, as the relationship that other states and/ or countries, such as Alaska and Norway, routinely do. Their respective "heritage" funds sit at several billions times what Alberta's is, because they negotiated tougher royalty rates, which the energy sector agreed to in those jurisdictions. The energy sector has been getting a free ride in Alberta for far too long. And of course, their response is that the sky will fall if Alberta goes ahead and institutes the reports' recommended changes. Well the sky didn't fall in Alaska or Norway and their citizens enjoy a much healtheir rainy day fund. It's high time those princesses in the energy sector took a reality pill. Alberta does not want to experience the resource pillaging that occurred in Montana where the companies took what they could and left the citizens to clean up the environmental mess without a tax infrastructure to do so.
RRE3585 please do not kill an industry that has boosted most Albertan's livelihoods and economic status. You're mostly going to hurt those indirectly involved in oil and gas: retail, coffee shop owners, motel owners, etc.
RRE3586 I am urging the government to impliment the recommendations of the royatly Review Report in its entirety. This is after all a report that your government commissioned. How can you now not trust their recommendations? Surely it was apparent that the oil companies would lobby against any proposed increase in the royalty structure, just as it is and has been apparent that these companies were going to cut back their expansion in Alberta in any event. The cost of construction has increased far too much for these companies to continue to develope at the same pace. Threats by Encana to decrease their investment by a billion dollars is really nothing more than a reduction they were planning in any event. A proposed increase in royalties just gives them an excuse to do what they had all along planned. Almost all of the people I have talked to are concerned with the rapid pace of developement in Alberta, and are of the opinion that we should slow down the growth in any event. Of far more concern to Albertans than an economic slow down are concerns that we are not doing enough to protect our envireonment and that we are developing and depleting our oil and gas resources at far too rapid a pace. Albertans want the pace of developement to be modereated so as to ensure that our resources are still available for our children and their children. Why the hurry? Where is it written that we must race to deplete these resources in a few decades. I know that the oil companies have made much of the belief that our oil reserves are costly to develope, and that correspondingly they need certain royatly breaks. However examination of the situation in Norway should show that the cost of developement of our oil resources should not be a barrier to an appropreiate share being paid to Albertans. I cannot believe that even our tar sands developements can be as costly as drilling in the North Sea. Norway should serve as an example to us, particularly in the matter of the funds we put away in our Heritage Trust fund. The amounts saved by the Norwegian government and the paltry amounts we have managed to save in the past fifteen years should be an acute embarrasment to this government. This issue is extremely important to Albertans, and I dare say will be reflected in the next election results should the weak and wrong decision be made. Please have the courage to make the right decision. [Information Removed]
RRE3587 Don't let the oil companies intimidate you. Raise royalties. We've been essentially giving away our resources for far too long. If the economy slows down a little, then that would be a good thing. We shouldn't be in such a hurry to strip all the resources out of the province.
RRE3588 Good for you Premier Stelmach. I like how you handle things like the royalty issue and blow-hards like Bronconnier. Straight forward, calmly and honestly. It is refreshing. Thank you!
RRE3589 I have been in Alberta for 10 years now. I am amazed that the government continues to be bullied and threatened by the oil companies. Average Albertans struggle to make ends meet and the oil companies continue to rake in the money. The increase in royality fees is a vital. There are huge gaps in the funding for Education, Health Care, Infrastructure and protection of the Environment. The monies collected need to be used in these areas. The government is building more schools when they are not adequately funding existing schools. There are not enough teachers, substitute teachers etc. Schools should not have to fund raise for furniture, computers, books etc. The issues in Health Care are well documented. Infrastructure throughout the province is declining rapidly. The government just announced that they are concerned about air and water quality. We need to ensure future generations are not having to suffer because government hesitations due to oil company bullies. Oil royalities could also assist people with their utilities. My Direct Energy bill jumped $110.00 per month this year. This is highway robbery. I am trying to improve the energy waste in my home but it is a struggle at times to just pay the monthly bills. I guess that is the Alberta advantage.
RRE3590 I work for a large major Oil and Gas company and I was amused to hear we were spending such a significant amount of money in Alberta this year 2.5 to 3 Billion$, and drilling over 1000 wells. We have never spent that amount of money and we have never drilled even close to 1000 wells. Last year our wells drilled was reduced to about 340, in an effort to bring down the costs. The plan of all the O&G companies was to reduce drilling to force down the costs. Our company is over staffed by almost 50% for the amount of wells we drill. People are sitting on their hands doing absolutely nothing. This is very bad management and I as an Alberta Tax Payer, am totally sick and tired of subsidizing the exorbitant salaries and perks of the executives and professionals in the oil and gas industry. [Information Removed] This borders on riduclous. We need a correction in this industry. This could be it. How can one feel sorry for ENCANA who made 6.5 billion last year? They don't work a full month anymore and their employee vacation time is unbelievable. We as Alberta taxpayers are obviously subsidizing those perks, as well. The gravy train has gone on far too long. The American companies are hurting very badly from the reduction in their dollar and they are using the Royalty Review as a scapegoat. It isn't the Alberta taxpayers problem to keep them solvent. As I hear all this spin put on by the O&G companies, I haven't heard anyone say they feel sorry for the Alberta taxpayers. it is all about me and how much I can make. Our taxes have been subsidizing the O&G companies for far too many years and it is time to make a change. The O&G companies keep saying the data in the review is flawed, but where is the concrete evidence as to how, or where or what it should be. They have to say those things, too make their shoreholders happy. Hopefully, the government and Mr. Stelmach will prove to Albertans they really care for the future of this province and not continue to pad the pockets of a few in the O&G sector .Albertans are tired of propping up the foreign O&G companies as has been the case for the past couple decades.
RRE3591 I do hope that the Premier follows the Royalty Report closley and does not let the BIG OIL people influence his decision in any way. They have for to long been getting rich at our expence. Anouther point that bothers me is the arrangements with crown land leases to farmers and ranchers who are allowed to collect surface lease revenue on this land when that revenue should go to the land owners who are the people of Alberta. I know of a lot of these farmers and ranchers who have become very,very wealthy at our expense through this arrangment.
RRE3592 I personally believe if you implement the taxes you wish we are going to get the best depression in alberta since the 1930`s.So what ever happened to all that money we put away for a rainy day? I would say it is raining now wouldn`t you?
RRE3593 Hello, I think that it has been about time that the royalty review took place. Alberta should get a bigger stake in its resources and use that money to start building up other industries within as well as social programs. This economy has for too long been based upon one source and it needs to be diversified as soon as possible. I think energy companies are just trying to flex their muscles right now, but the Alberta has a strong hand so now is not the time to fold. In other countries ie: Boliva that reversed its Royalty rates from 20% to 80% many major players stuck around. I suspect that will be the case here as well. I work in oil and gas in Crown Royalties in fact, so am just putting it out there that there is support for this decision even within the industry. Not that we can really admit it when were constantly being pressured to not support the royalty review. Sincerely, [Information Removed]
RRE3594 Our Fair Share, the report of Alberta’s Royalty Review Panel, clearly concludes we Albertans do not receive our fair share from energy development and we have not, in fact, been receiving our fair share for quite some time. Seeing that we supposedly live in a democracy, I as an Albertan can claim to own as equally much of the oil resources as the premier or the minister of energy. Thus, if this is a true democracy, you politicians and oilocrats will actually listen to us Albertans who are sick of having our Land and Water raped by the oil industry and leaving only pennies in their wake. So listen up, it's time to implement all of the recommendations from the Royalty Review panel. Lets start charging more. “By failing to keep pace, the Alberta government shortchanged us by $1.9 billion last year alone. Imagine how many women's shelters we could have supported. And that's just one year.” The staus quo is totally unacceptable and irresponsible. Fix it!!!
RRE3595 Royalities should be increased as recommended by the report, leave politics out. As an Albertan and a shareholder of oil companies I am of this opinion. If the oil companies decide to work elsewhere, so be it, they will be back, and the oil will still be here. And that is good to me as a shareholder. AB is too hot and we are needing to bring in people into AB which is putting stress on our infrastructure. AB gov't has been unable to keep up with providing services such as education and health to Albertans, not to mention roadways et al. If the increased royalties slow AB growth, that is a good thing. Remember that royalities are only part of an equation, most would rather pay higher royalties to work in a country that is safe and that there is no risk that a company's investment will be confiscated by a foreign country. AB has the largest oil reserve in a politically stable and safe country. The royalties must be implemented as per the report. No waffling by government!
RRE3596 as far as I am concerned our royalty setup is just fine the way it is it keeps things busy when the price is high even now when the price is low this province slows to the point that alot of people have trouble making there bills and I dont agree that we are not getting our fair shares in my town the tim hortons employees make $15 an hour you do not see a wage like that in a town that does not have oilpatch the more royalties you take the less money there is to pay me the high wages I enjoy due to living in alberta also because wages are not as high and people do not have the jobs they need my property value will drop because nobody can afford to pay for it along with the tim Hortons employee the line ups for that place will shrink and I dont think they will be getting $15 an hour maybe we should leave the oil companies alone and put royalties on the coffee industry they seem to be doing pretty good.
RRE3597 If the royalty review passes as is there will be negative affect to our provinces economy, unemployment rate, and charitable donations (which are needed). The province needs oil and gas companies to be active in communities and the panels recommendations will drastically decrease this. Work can be done to ensure that the province is getting what it needs, but it needs to be done in co-operation with the industry. The panel's review obviously did not take this into account when the report was completed. Thanks for your time. [Information Removed]
RRE3598 I think the panel did a lovely job. The royalty review report was a bit to lenient with the proposed payers but overall, very well done.
RRE3599 You (the gov)are going to take Alberta into the old energy policy ,please go back to school because you have not done the math,bring back Ralph
RRE3600 I came to Fort McMurray, Alberta 2 years ago looking for security, democracy, and new opportunities. I brought my professional experience, knowledge, and hard work. Because I believe in Canada, I have started a new live here, I have invested all my savings, my son born here, I got a good job at the oil sand projects, and I would like continue living in Canada with my family. I do not want loss my job, and start again in other country. I agree with protect the environment, improve infrastructure, increase royalties, etc. I ask to the government to carefully analyze the impact that such measures will have in the oil and gas industry and the people. We want responsible leaders which plan a solid and bright future for Alberta and Canada.
RRE3601 This report appears to be well thought out with a proper emphasis on, what I consider to be a key ingredient that the resources belong to the citizens of Alberta. I fully support the accountability recommendations: Page 18 to 21 of the executive summary. I think coal revenues should be included in such structural changes. The current system seems to permit more opportunities for abuse and corruption. I don’t think a government is wise is allowing for such practices or as the report suggests not having an overseer. When it comes to royalty rate changes, I think the government has had good people create this report, and some of their judgments are to be trusted. Certainly part of the negotiations involve the world price for oil. When oil is at current levels, why are not the owners of the resources experiencing greater revenues. Owners of real property are. But what happens when oil prices drop below a certain point, should royalty rates remain the same as before. What this points to is a need by the Government of Alberta to conduct open and transparent royalty revenues of sale of its resources on a regular basis. In this way we avoid the confrontations we have today. After all, I am not surprised to see the oil industry want to protect and increase its profits. It is a business whose value is to have more rather than less. And as a business, it does not have to concern itself with the long-term future of the province. Our government should be concerned about the long-term consequences of their decisions. The Government is to be complemented on having this report created and openly distributed.
RRE3602 Dear Premier, I believe that the proposed changes in the Royalty Review Panel report are based on incorrect data on what F&D costs. If the review is approved, there will be a devestating result to the Alberta economy. It is not just oil companies that will suffer. Tourism, hotels, restaurants, manufacturing, research etc, are all affected by the outcome. If investment money is decided to be spent elsewhere this great province will become a contestant for mass exodus.
RRE3603 The royalty review results are terribly flawed. It fails to account for the reduced investment as a result of the increased royalties. Albertans are enjoying one of the strongest economies in North America right now because of the "Alberta Advantage". This advantage is one that has promoted the average Albertan to become an entrepreneur and create jobs for individuals around him/her. The increase royalties would in effect kill any investment in the marginal areas and make it prohibitive for junior companies to do business here. If the recommendations of the review are implemented, Government revenues would remain flat and unemployment would sky-rocket.
RRE3604 The suggestions made recently by the Royalty Review Panel, while ostensibly aimed at increasing the province's income from a potentially lucrative industry, would, in fact, have almost the exact opposite effect. I am an investor in the Alberta oil sands industry, and have put my money and time into the development of its potential, in the hopes of eventually reaping a concomitant reward. Billions of investor dollars have been spent to find, prove out, and bring these resources to market. The proposal by the Review Panel ignores the time, money and effort put in by thousands of investors such as myself, and instead claims the bulk of profits for itself. Without the promise, or at least the possibility, of a meaningful return on my investment, I and many like me will simply find better places to put our capital to work. Without our backing to make it possible to continue the long hard work of bringing this resource to market, there will be no Alberta oil sands industry and nothing to tax. The current tax rate, while high, does at least allow the people responsible for growing this industry from the ground up to see the potential for adequate reward. The tax rates proposed by the Review Panel will make such an outcome so unlikely as to kill the industry, resulting in no net income to the province whatsoever. I strongly urge you to reject the Review Panel's recommendations and thus bring the greatest benefit to everyone involved. [Information Removed]
RRE3605 I sincerely hope that the government that I voted for does not use this report as an opportunistic money-grab. The oil and gas sector has been the backbone of Alberta for years - and indeed has been my entire career. Implementing these changes would impact the company I work for - and I would hate to see the 1980s revisited with layoffs and downsizing. The Alberta economy is doing well because people like me spend our money here - because we have the money from our jobs. Oil and gas companies already pay a substantial amount to the Alberth their employees and this would no doubt slow down. The trickle down effect of such a policy would be devastating. I urge you not to consider making these changes and to consult with industry if you believe a change does have to be made. Please don't make me sorry that I voted for you - I don't think this is the legacy you would want to leave behind.
RRE3606 I think it is ok to get our commission from oil companies and they are also willing to accept a reasonable increase. However, What I can't accept is that the gov't's negligence to collect our money from the companies. If we fix this, we can have enough money to provide our folks in Alberta
RRE3607 I am a consultant in the information technology sector and have grave concern about the proposals and their impact on my livelihood. As a lifetime Alberta resident, I have had the opportunity to work in the oil and gas industry and have a decent understanding of the economics of O&G. The proposals amount to 'moving the goalpost' and will cause a serious downturn in Alberta the likes of which we have not seen since the NEP (another goalpost move by un-informed, greed public officials). Please let free enterprise continue to drive the unparalleled economic growth in Alberta. This is bad government and not what Albertans want. A bigger 'fair share' of less is simply less; and this Alberta would MUCH rather see the free market economy thrive and work than have government rules cost the province it economic prosperity and the government its electoral vote.
RRE3608 I briefly reviewed the final report - and other than disgust for the apparent greed of the current government, I am not sure what to add. The oil & gas industry is the backbone of this province. Although I appreciate that in the last few years the industry has had phenominal returns on their investment - we all know this will, in all likelyhood, not last indefineatly. Furthermore, the Alberta government has had more revenue than they know what to do with as a result of the CURRENT royalty regime - and rather than be grateful, they are getting greedy. We all know why Saskatchewan has not had the same development as Alberta - the industry took their dollars elsewhere because of the restrictive fiscal regime - and that is what will happen in Alberta. I would like to know what plans the current government has to handle the unemployment issues that will ensue when the industry stops spending its dollars here - raise royalties and taxes - what a novel approach! Like it or not, we are blessed to have an industry that is willing to spend BILLIONS of dollars, at a considerable risk; when the risk pays out, the returns are huge. What this government has failed to realize is that when the project flops, the industry has to suck up the loses. Companies are not going to be willing to invest in Alberta if the payout is not there. It is called ECONOMICS 101. In closing, I hope that a provincial election is called within a short time AFTER you implement the changes and while the unemployment lines are growing. Good luck getting elected. If this government thinks they can ride on Ralph's coattails - look at what happened to him.
RRE3609 This should not occur, it will totally destroy the economy and drive people away from this province. Don't make a mistake!
RRE3610 The public press in response to the royalty review panel report has portrayed the industry as not having paid its fair share in royalties for a number of years. Whether the report is valid concidering outdated data used in the analysis is not the important factor but that the general population who support higher royalties does not understand the risk that producers endure in their day by day investment in the oil and gas business. There is a risk of not purchasing leases at a land sale( 1 in 3 chance of success), not getting the farmin to explore for reserves (1 in 5 chance of success), the geological risk associated with the exploratory prospect ( 1in 3 to 1in 5), the engineering risk the well will produce economic reserves( to payout the drilling, completion and equiping) and provide at least a 12% BTROR. You put a lot of G&A into evaluating leases, make an attemt to acquire them at a land sale or try to farmin in, drill a well and god for bid if you are successfull the now the rules that you originally invested under have been change so that the effort to make the new discovery( if you didn't drill a dry hole) is now rewarded with an additional burden that will reduce that 600 Mcf/d's future value by 14% of asset value. A 600 Mcf/d well on a risked basis does not provise a robust economic return. The development wells are required to make a project economic. If the full gas royalty is put in place, on a risked basis my company will not invest in this marginal project.The Western Canadian sedimentary basin is North America's highest cost basin for natural gas. Gas prices are waning, cost are still very high and the outlook is dim. This is an inapropriate time to consider making changes to the gas royalties, because that is where the bulk of the 2 billion in additional royalties would come from...not from the oil sands! They are the ones benefitting from $70 oil. Regarding conventional oil, when was the last significanrt oil discovery made? Most pools are less than 250,000 barrels and if you are lucky produce at > 50 BOPD and recover 100,000 barrels. You do thahe math at a 1in 3 to 1in 5 chance of success and there is no economics in an oil prospect with royalties approaching 50%! I hope some clearer heads than the generally uninformed public are making the decision because $2 billion reinvested by the industry or distributed to Alberta share holders who spend in Alberta ( witha 3 fold multiplier of economic effect) is a far better use of proceeds than any government (not just yours) who in the past have an uncanny ability to waste publes funds. Think higher unemployment, reduced tax base and taxes, reduced investment by the industry and investors (canadian and foreign) an that may be the effect we see as a results of this proposed royalty chane to conventional oil and gas. A "Perfect Storm" is on the horizon and may ships are going to be sunk!
RRE3611 The very minimum that the Alberta Government should do is to accept the recommendations of the Review Panel in their entirety. The Review panel recommendations are themselves a very serious compormise. There is no further room for compormise. Even though I have never voted PC, I will do so in the next election if the Stelmach government stands up to the Oil and Gas lobby in this province.
RRE3612 I work in the Industry and have for 12.5 years. I have seen a lot of changes and growth in that time. But this year has been different. Because of the "boom" that seemed to hit this province, rising prices on everything, in turn caused End users to to back off of projects in hopes of bringing pricing back down. (This was in the construction & transportation sector of the industry). Unfortunately, this increase in pricing never benefited those further down the line. Now we are seeing a BIG slow down. Wells aren't being drilled, projects that normally keep us busy in the winter months are not happening. I am in sales, and my customers are telling me it is slow. The "packagers" are hurting for work to keep employess busy, and many have had to lay people off. Maintenance is busy, but that is not enough to sustain the companies. So, what does this mean? This means that I am concerned what a change in the royalty program will do to my livelihood. It is already slow out there (at least for us), and even our export business is in jeopardy given the current state of the dollar. And what will I personally gain from the change in royalties? Will that money actually end up in my my pocket like my paycheck does? I worry, that people just have a bad taste in their mouth about the oil companies, and just want to stick it to them. I agree, they post great profits eveery year, and I sure would like to see them share. But they do. They sponsor recreation complexes and sports teams, and donate money to programs. The boom in Alberta has benefited more than just the oil companies. Hotels, [Information Removed] , housing-- all sectors have seen benefits. I just want to say, be careful, because the consequences and repercutions may not be what you expected, and they could have far reaching effects. To the little people who work in the trenches of the Oil & Gas Industry, this could mean the difference between a boom and a bust.
RRE3613 My first question is what is the need for such drastic changes to the royalty structure when for the last several years we have been running a surplus in the billions? Secondly it doesn't take long looking at the royalty report to notice that it has obvious flaws in its data. Your can't jack utp the royalty rates and then expect the projected reserves to remain the same. This would obviously result in bad conclusions. And if the industry which has already said they are willing to take atleast 1.5 billion in capital investment out of alberta, the ripple effect could easily offset any gains seen from higher royalty rates. I think most albertans who want the review to be accepted as it is are very gready and don't care for the large portion of this province who's incomes are based on the prosperity of the energy sector. What good does a new hospital make if you can't afford to feed your family!!
RRE3614 A long overdue review. The conclusions and recommendations are right on the mark and the government should adopt the whole of the report. A mechanism for ongoing reviews should also be established.
RRE3615 If oil companies need to cut back due to increases in royalties, then they should consider cutting back on all the bonuses given out to their employees. Not all employees in oil and gas receive bonuses and I don't think it should be given to a privileged few. Goodbye sports car, vacation home, yearly vacation getaways, etc. Welcome to ground zero. Also, employees in oil and gas need to be given a more realistic wage. It is their high earnings that's driving up inflation, high cost of living, etc.
RRE3616 Government interferance in the private sector always ends up negative not for the Gov or the comanys it hurts the average hardworking Albertan and we need to reconsider your actions, this could be good for Alberta but the fact is, is that it is not going to be Oil Companys are going to fight it and that only means less work for me, its not going to affect you or the comanys positively or negatively but I gaurantee its gonna affect me negativly so please don't do it or Albertans are in a lot of trouble, this is the wrong timeing to try something like this 5 years ago it would have bean an exellent idea, please look at what is going on economically with this province right now not 6 mounths or a year ago, I think a smarter policy that would accually help the working Albertan would be a use it or lose it policy as it comes to leased land and different zones this would keep our people working and forcing companys that have taken so much from this province to invest in it and its people again.
RRE3617 With respect to the Royalty review, I agree with the Wall Street Journal. When Mr. Stelmach became premier I thought he would be inept, at best. Another Don Getty! However he is not that good. I think 'foolish' is the description used by the WSJ. The province will not need the proposed high speed train between Edmonton and Calgary if go thru with this proposal. The slow one will be more than adequate.
RRE3618 Hi think the royaly should be the same right across the country, then the oil companies can go where they want but they pay the same
RRE3619 We are already seeing layoffs in the oil and gas industry, this new royalty recommendation will make the industry worse and cost Alberta more money. As most of us will be on welfare, lose our homes..
RRE3620 By enacting changes to both conventional and oil sands, the overall industry impact will increase and current government cash flows will dip greater than the perceived benefit from the increased regime. Despite recommendations in the van Meurs report calling for sliding scale royalties at higher oil prices, the panel recommended these to be active at a lower $40 WTI. Given the attitude the panel has displayed upon critisicm of their report, (comments such as "leaving it in the damn ground") in addition to the the fact that much of the economics surrounding the analysis have been called into question and appear to be greatly unrepresentative of the current operating environment, highlight the fact that there is an obvious agenda in place by the panel against big oil as thier recommendations are fundamentally flawed. The potential impact needs to be gauged by stepping back and looking at the socio-economic impacts which we will all face given this modified plan.
RRE3621 As a hard working Albertan in the oil industry, once again I am getting it in the [expletive]. First to set me off into this rant was the "Energy Trust Abolishment" decision by the feds with the backing of you spineless politicians. My dad told me when I became old enough to vote and was exited about voting for the first time, his words when I asked him who he was voting for he said "politicians are all [expletive] and it is up to me to pick the SMALLEST one". I took those words with a grain of salt until last year when it actually affected me and my retirement. Now I need to deal with another stumbling block with this [expletive] Royalty Review Increase. By the time I am ready to retire I will be 78 years old. I just want to thank the whole Government, Federal and Provincial for taking my retirement away from me and my family. I am not alone in this, you people have messed up thousands of retirements and lives.
RRE3622 Don't shoot the Golden Goose
RRE3623 I believe that the increase in Royalty rates should be given directly to the Alberta people in the form of a yearly royalty cheque. Money given to the government will be squandered and or given to special interest groupsf and will not benefit the average hard working Albertan. If this cannot be done, there should be no increase.
RRE3624 As a taxpayer I would be very disappointed if after paying tax dollars to commission the Royalty Review Panel, the Alberta Government now chose to ignore the panel's recommendations. I am tired of paying so dearly at the gas pumps and for household utilities (gas and electricity) while oil and gas companies continue to realize huge annual profits. It is way past time for Albertans to benefit from that which belongs to all Albertans!
RRE3625 I think alberta government should lower the royalty tax on oil and gas instead of increasing it. Increase royalty tax will force all oil and gas company slow down their business, cutting their budget on exploration, some small o & g companies will even go bankrupt , as they don't make enough to maintaine their business. Job cutting, O & G companies make less profit etc, causing many bad effects on alberta economy. I think it is very silly way to increase government revenue by increasing royalty tax rate without considering long-term consequencies. Alberta Government, don't just look at your short term gain, as you will getting your long term loss.
RRE3626 I have been in the Canadian "Oil Business" as a service supplier for 24 years. I do believe that Alberta needs to ensure that Oil companies should pay their fair share for royalties. Please keep in mind that Alberta is a very expensive place to live & raise a family, and unless this government plans to make my mortgage, food & truck payments any “Royalty increase” needs to be without shutting down this business any more than it presently is. The people that make these decisions need to spend some time in the real world. Because the Oil Field Service Sector and all related business is very slow at this time. With the cost of things in this province, housing, taxes & etc we are already living close to the bone, and just because the EnCana’s of the province are reporting record profits it doesn’t mean we all are enjoying the same success. If the Canadian Oil field service sector slows down much more, I and thousands like me will be out of work, and it doesn’t take a financial wizard to figure out that Alberta will loose much more that it tried to gain with any sort of a Royalty increase. Everyone who has lived here long enough knows from the past, if the “Patch” slows down, every one in this province will be adversely affected, from Building construction right down to cigarette sales.
RRE3627 It is very important that the government accept and impliment all of the recommendations of the Royalty Review panel report. Doing so will have many long term benefits to the provence.
RRE3628 I had worked in the oil patch for over 20 years and support the recommendation of the royalty review report. On the conventional oil & gas side the royalty structure needs simplification and should reflect today's reality; the days of big finds of conventional O&G are gone and new production/exploration incentives would not change that. The heavy oil royalty structure is outdated and should be modified. Heavy oil is the future oil of Alberta. The industry has matured, and production cost declined dramatically. Grandfathering does not make sense as tax/royalty incentives were intended as a startup boost for the industry and older player passed that stage long ago. In fact they are in a much better position than the new ones due to already owned infrastructure. The new royalty structure still positions Alberta as the best place for investment in the oil & gas bussiness.
RRE3629 Thank you for taking a serious look at the oilpatch issues in Alberta today. The main objection to the panel's Royalty Review Final Report (105 pages) appears to be a concern that increasing royalties will create a substantial decline in investment activity. With this objection in mind, I read the report with deep interest, watchful for extremism, but in fact I found the report to be moderate to all parties: The owners, the producers, and the economy. It strikes a sensible balance, which should result in stability. The Afterword frames intelligent questions for the future. I therefore hope that the report and the panel will receive the respect and vindication they deserve in government decisions to come. Thank you again for undertaking this important work. Yours truly, [Information Removed]
RRE3630 I am a member of the conservative party and a loyal conservative voter both federally and provincially. I just wanted to have my comments recorded in regards to the royalty review. I don't believe changing the royalty regime will have any positive effect on the government purse or to all Albertans. In fact, I believe it will have grave negative consequences. With how low margins are on new gas oil projects in Alberta any increase in royalties would make most projects uneconomic especially compared to the much lower costs that the U.S. has currently. I would hope you and the other MLAs would see this as I do and therefore leave the royalty rates alone. We should not want to kill the Alberta economy. If royalty rates were increased 20%, without a doubt production would be at least 20% less within 2-3 years because of less capital spending in Alberta, and therefore the Alberta government would not gain anything except that there would be a lot of additional job losses and Alberta would be seen internationally as a place not to invest. We want Alberta to remain the most business and investment friendly province in Canada. Thanks, [Information Removed] Calgary
RRE3631 The Govn't of Alberta needs to place more weight on the the trickle down impact of oil/'gas development. ie, the income taxes paid by those who work in the oil/gas sector, and the income taxes paid by those who sell to oil/gas employees. Every dollar of reduced oil/gas spending is greatly magnified further down the economic chain. Translation - take an extra dollar at the source end, and loose more than a dollar at the other end - net result = net decline in tax base. Alberta presently has a fantastic economy - low unemployment, and much higher relative wages, all the way down the chain, to 7-11 clerks for example. This is the outcome of a working oil/gas sector. Now think of the other extreme - $4000 condo's in Calgary when the oil/gas sector pretty well shut down with $10 oil. Reduced oil/gas primary activity impacts every other sector of the economy - from Real Estate, to Retail. When Alberta risks reducing oil/gas primary spending, it also risks lowering realestate prices, and cutting wages at seemingly unrelated places like 7-11, and elsewhere. In my view, Alberta should limit its royalty analysis to the oil sands. At current price levels, oil sands developement is lucrative - it no longer needs economic facilitation in the form of low royalties. Moreover, the oil sands are in Alberta - the money is going to be spent to get it out, regardless of relatively small increases in the royalty rate. There are no other places for the companies to redeploy their capital. Conventional oil/gas exploration/development on the other hand should be left alone. These companies will be forced to slow down development. Current gas prices for example, already resulted in spending cut backs for this year. The Govn't should not be thinking about making this situation even worse. Moreover, the gas market is not going to be getting any better - the introduction of LNG (liquid natural gas) this year crossed the import volume threshold needed to keep N.Am prices low. The N.Am natural gas market is going to get worse, not better. Alberta is already seeing reduced gas drilling - which will result in less gas production in a year or two. Why on Earth would the Alberta Govn't act to make this reduction even worse?
RRE3632 I am extremely concerned about what this decision is doing to our economy in Calgary already. Our Real Estate market is already put in crisis, and will get even worse if this goes through. Calgary has been so volatile over the last 4 years, can we please just get some stability. Do Not put this through. Loss of jobs alone will put Calgary in a horrible situation. We need to stabilize our city.
RRE3633 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 06:46:09 DATE ENTERED {ts '2007-10-02 07:00:01'}
RRE3634 I have been following this Royalty Review and the intense discussions over the past few weeks. Albertans have "no" choice but to get their fair share of the these windfall oil company profits. I make my living from the oil patch and would be glad to give you more thoughts, but the bottom line is " we need to keep some of the oil and gas in the ground for our grandkids and their kids". People driving their big SUV's and spending hundreds of dollars for a lunch had better smarten up. It is time to tighten our belts and get on with this. Ed - Don't you dare bend. Implement the recommendations of the report, 100%. People and their spending are out of control in this Province and they need to get back to reality. [Information Removed]
RRE3635 The strength of this province lies in every town from Duchess to Drayton to Lac LaBiche because we are all working in good jobs and creating growth everywhere. There may room for more royalities to be worked out but have we not figured out that money in the economy vs in the government is always better. Dollar on par, low natural gas prices and a third nail will create the perfect storm to crush this economy. If its working the goverment does not need to control it. Let this economy roll on the free market and let the people reap the benefits as a whole vs. segmented government payout in programs.
RRE3636 I am concern that oil & gas projects may be cancelled, lots of people may lose their jobs and homes in Alberta. Please reconsider the impact of the royalty review and handle it with care and and good balance.
RRE3637 I believe that 85% or the profits form the oil and gas industry are put right back into the Alberta economy. If $2 billion is taken out of the economy it will have a devestating effect on Alberta.
RRE3638 As an employee working in the oilpatch in Grande Prairie and also a bussiness owner, I must express my concern. We have notices a huge drop in business this spring, summer and fall as a result of low gas prices and a strong cdn. dollar. This has caused hardship already. To add to this with increased royalties will cripple not only the oilpatch but all the supporting business such as hotels, restuarants, shopping, car dealerships, housing etc.
RRE3639 This is UNACCEPTABLE! It is always important that the owners of the resource receive significant benefits from resource development. In Alberta, the industry pays for access to leases through bonus payments at land sales, and pays royalties on production and taxes on income. In 2006, bonus payments at land sales totaled about $3 billion, while royalties paid totaled $11 billion. Combined, this represents approximately 40 per cent of the Government of Alberta’s total revenues. If you add taxes from the industry (including oil and gas service companies) along with income taxes paid by employees involved in our sector, you can see that our industry is the primary driver of the economy of Alberta. And, where does Alberta stand today? Unemployment is currently at the lowest level of any jurisdiction in North America. The Province is debt free and generating annual surpluses that are the envy of virtually all other jurisdictions in Canada and beyond. Individuals enjoy the lowest tax rates in Canada, and Alberta does not have a sales tax which is clearly an advantage. More importantly, companies are investing billions of dollars in our economy to keep it strong for the future. In our integrated economy, it is important to consider all elements of wealth creation and not just government-take. In 2006, our industry spent $60 billion on capital and operating activities in Alberta. This number dwarfs the amount paid in royalties and land bonuses and is the real driver of the Alberta advantage. Despite the wider benefits of oil and gas activity in Alberta, the panel’s analysis focused exclusively on “government take” through royalties and concludes that royalties should be increased significantly. Under this framework of analysis “government take” comes at public expense because the additional money the government wants must come from somewhere, and in all probability it will come from capital and operations – the very spending we undertake to support the wider economic benefits. ii) Comparison to Other Jurisdictions: A key argument used in the report to support the recommendation to raise royalties significantly is the assertion that “government takes” elsewhere in the world are higher than in Alberta. But, this assertion is meaningless without comparing cost structures, well productivity, reserve sizes, and reinvestment levels. To deal with these issues, financial analysts typically compare returns on capital employed to determine which jurisdictions provide the best returns for those investing the capital. A table, prepared by John S. Herold in 2007 presented in the Source: National Post, Tuesday September 25, 2007 page F5, illustrates that returns in Canada are modest compared to many other jurisdictions. The results are not surprising. Generally speaking, Alberta is a high cost jurisdiction where reserves and deliverability are small compared to many other jurisdictions. Nexen for example, invests in many countries around the world. Our corporate experience is similar to the information presented in John S. Herold's chart. Our Canadian operations generate some of the lowest returns in the company. In fact, over the past four years, we have generated $662 million in oil and gas income (pre-tax) from Canadian operations, while at the same time investing over $4.2 billion. This equates to spending over $6 in Canada for every $1 earned. iii) The Gas Business With regard to gas projects the ARRP report suggests that approximately 80% of gas wells will see reduced royalty payments if the recommendations are implemented. However, analysis shows that this would occur only if gas prices were to decrease to approximately $4 per mcf. At more current levels of $6.25 per mcf, the proposed royalty rates are all above the old ones. An assessment that at the price levels we need to support investment in many of our gas projects, 80-90% of gas wells would pay higher royalties. Today, with existing royalties on gas, rig utilization in Alberta is running at about 40%. If industry activity is already in decline in Alberta, higher royalties will only decrease activity further. In the US, where the industry is drilling similar prospects, rig utilization is approaching full capacity. iv) Oilsands Oilsands is another area of concern. As you know, oilsands projects are extremely expensive, take years to build and take even longer to achieve payout. In essence, they require billions of dollars of investment prior to any returns. Generic fiscal terms were developed in the mid-1990s through extensive collaboration between the industry and the federal and provincial governments. These terms did what they were supposed to do – encourage companies to develop new technologies to facilitate the development of the oilsands, a legacy asset that will be supporting Albertans for generations to come. While the ARRP conducted hearings around Alberta, their process was in no way as extensive as the previous process which resulted in generic royalty regime. Before proposing recommendations, changes to the terms should have been established by following a collaborative process similar to that utilized in establishing generic fiscal terms a decade ago. This would ensure price and risk are fairly valued and capital invested in this essential sector receives appropriate returns. Investment in oilsands development is critical to the economic well being of Alberta and Canada. An important issue related to oilsands is the new severance tax proposed in the report. It is a new tax on gross revenue that does not consider our costs and is not deductible for income tax or other royalty assessment. This is a very regressive tax which essentially leads to double taxation. The closest comparison to make is similar to the Petroleum & Gas Revenue Tax, one of the worst elements of the federal government’s National Energy Program, introduced in the early 1980’s, which devastated investment in Alberta and resulted in significant job losses and a decline in property values. Other concerns include the ARRP’s recommendation not to grandfather past investments in implementing their proposed royalty system. Traditionally, when major changes have been introduced, grandfathering has been provided to ensure that all existing agreements are honoured. Ignoring grandfathering or some form of transition to a new system puts Canada’s reputation as a stable and reliable country in which to invest at risk. v) Unconventional Resources The future of Alberta is largely in unconventional gas (e.g. coalbed methane, shale gas and tight gas) and oil (EOR and oilsands). These are high-cost, low productivity projects that require high prices to generate acceptable economic returns. The recommendations in the report call for the government to receive a higher royalty rate on gross revenues without consideration to our costs and time to achieve payout. This serves to erode the attractiveness of these investments to a point where many become uneconomic. A Better Approach Given the rapid rise in commodity prices, there are opportunities to change the fiscal takes and to increase royalties. However, these changes should be implemented carefully and after a collaborative, in-depth consultations process similar to that followed to create generic fiscal terms for the oilsands a decade ago. Before implementing the current proposals, the Government needs to fully understand the impacts of proposed changes so that we do not stall investment which is the real driver of our prosperity and the “Alberta Advantage.” Thank you for your consideration of this message in your ultimate decision.
RRE3640 As the oil industry is at a low right now for the past few years, this will just force companies to reassign a large portion of their investment elsewhere. In the end, it is not only the Oil Companies that will suffer, the service companies, the trucking companies, the fabricating shops, the so-called Oilfield towns (Fort MacMurray, Grande Prairie, etc.), and many others. It's unfortunate that many of the citizens, who aren't related to the oilfield, feel they should have more of a share of the profits without realizing the true consequences of what may happen. It will bring about a recession similar to the early 1980's where hundreds of people in the oilfield were being let go every day.
RRE3641 “The Panel’s intention is to increase Alberta Government royalty revenue by about $1.8 billion. However, this could turn out to be a very costly $1.8 billion. We think the cost in terms of reduced development expenditures (which largely go to Albertans in the form of wages) and reduced oil and gas sales would amount to at least $7-8 billion within a year. Albertans would lose jobs, income, and home values would fall while their provincial government temporarily increased its surplus.” - Canaccord Adams. Alberta is what it is because of Oil and Gas industry. I persoanlly thik Alberta gets more than enough in royalties from the industry. There is no need for a royalty review. I think we should make it more attractive for the industry so they can drill more wells in our province. We have the lowest unemployment rate in the country becaue of oil and gas industry. If the government goes ahed with this new proposed royalty, there is no doubt in my mind that thousands of people will have no jobs. Please reconsider!!
RRE3642 Oil company revenues have escillated . Yes they should pay higher royality rates.
RRE3643 This cannot go through!!! Economic Armagaedon for Alberta
RRE3644 I would hope the goverment take a uses casution the goverment on making I hope the government exercises caution in making significant changes to the current royalty structure. I’m an engineer employed direct by the Oil and Gas industry. The area of the province I work in is south of Grande Prairie. This area of the province has already been hit hard by a decrease in Gas drilling activity from 2006 to 2007 due to increased costs and low natural gas prices. The Oil and Gas industry directly and indirectly is responsible for Alberta’s robust economy. Any changes to the royalty structure must be thought through carefully because any reduction in Oil and Gas activity will have an impact on Alberta’s economy. [Information Removed]
RRE3645 The recommendations of the Royalty Review Panel should be adopted as presented. Objections from the oil and gas sectors are to be expected. Increased royalties may cause a temporary reallocation of investment outside of Alberta, but this also is to our advantage, as it will slow inflation, and slightly extend the commercial life of oil and gas reserves.
RRE3646 I have serious concerns about adopting Royalty Review Boad recommendations. If adopted, its not going to bring any good the way it is projected. The gas business is very different from the oil business. The proposed changes will severely hamper deep gas economics. Further, by not grandfathering existing production, cash flows of oil and gas companies are reduced significantly, especially in high rate areas such as the Foothills. In order for companies to operate within cash flows, they will have to cut capital significantly, ironically resulting in less future royalties. Lower activity means less opportunities for all Albertans in the communities where they operate.
RRE3647 I reviewed the charts comparing Alberta to the other oil producing areas and I am comfortable in agreeing that we should be increasing the royalties here. I believe we need to maintain some form of reasonable equity with the value of the resources. I believe the oil companies will still be in control of their own margins (increasing pricing based on "increased production costs") and this may have a negative impact to the consumer (higher prices). However, I also think that consumer demand will continue. A possible option would be to allocate the monies from higher royalties be allocated to an alternative fuels research and production initiative. [Information Removed]
RRE3648 I am not typically a person that gets involved in politics or writing letters to MLA's and such however I have such grave concerns regarding The Our Fair Share report that I feel that I would be remiss in not making my concerns noted regarding this report. I have been listening to the media and feel that they are slanting the report findings and that many of the constituents don't have all of the correct information regarding this report. I am no expert when it comes to Oil and Gas and the costs to remove the Oil and the profit involved per barrel of Oil but even I can see that a 20% increase with no grandfathering would be devastating to any industry. We pride ourselves here in Alberta for our stable market and implementing these changes as suggested in the report will do nothing but hurt Alberta in the short and long run. I am in the construction industry here in Calgary and feel that if the report is implemented it will affect every industry here in Alberta and think that all the Royalty adjustment will do (if implemented as suggested) is cripple every Albertan's ability to provide a good lifestyle for their families and those around them. I urge you to take a look at many of the other reports that are coming out with regard to the economic implications of this review and endevor to educate the average constituent when it comes to this issue in order to ensure that our economy remains vibrant going into the future.
RRE3649 I am contacting all of you regarding the Royalty Review report as I do not believe the Alberta Government understands the impact severity it will have on Alberta's economy. My own small manufacturing company which has 75 families which rely on my company for their financial well being. My name is [Information Removed] here in Calgary, we are an oilfield equipment manufacture, supplying equipment to the oilfield service industry providers. In recent years we have expanded and now employ over 75 people in our modern plant in the Foothills area. We deal with local distributors and we're re-investing $ 15 million back into the Calgary economy by way of lease payments, taxes, salaries, operating cost, sub-contractors and raw materials. In our current year, our plant is down 25% in production directly related to the soft natural gas market that our customers (service industry) had to scale back their equipment requirements. I have not laid off any staff yet because we have spent a lot of money in the last two years recruiting these highly technical tradesmen as we were anticipating a better 2008. However, with the Royalty Review report release in September, my views have changed drastically for 2008 & 2009 if these recommendations are implemented. We believe that our production would fall another 25% to 40% in 2008 and 2009 could be as much again as there would be too much equipment in Alberta to service a shrinking industry. Laying off is hard enough to do, but that might not be enough for some of us, with the high lease rates we have in Calgary, we may not make it. A lot of reports are quoting the small towns in Rural Alberta would be severely affected, you folks need to worry about Calgary. I've spoken to many other Oilfield Equipment Manufactures' in Calgary, the consensus is the same, there would be large scale layoffs in Calgary if these recommendations are implemented. If manufacturing is laying off people, rest assured that the Oil Companies downtown are going to have massive layoffs as well. Think back what happen in the early 80's when Calgary rolled up their streets because of our Federal Government intervention. Now this could even be worst all due to our Alberta Government, by yourselves. I will reiterate similar comments made by others; The government of Alberta should use extreme caution in contemplating significant changes to the oil and gas fiscal regime, particularly and higher risk profile of investment, and the current political and economic uncertainty already surrounding the industry, especially the drilling and natural gas. Please be our voice and bring our concerns forward. Regards [Information Removed]
RRE3650 Dear Mr. Premier, I applaud the government for undertaking the royalty review. The decision the government makes on implementing the recommendations will have long term consequences to Albertans. There will be an impact on our economy if all the recommendations are implemented, but I believe them to be short term. You must also consider the current negative impact that our economic boom has had on the social network. Is our current economic benefit worth the social costs we are currently facing? A slow down should not be defined as a bad thing. The oil and gas industry should not dictate to the people of Alberta the value of our resources. I strongly recommend that you implement all the recommendations of the royalty review, and if you are really feeling like a battle, go further! Thank you for this opportunity to state my opinion. [Information Removed]
RRE3651 How is the Premier going to deal with the thousands of people who will lose their jobs?and then their homes if this goes through?i will not vote for him again!if this goes through the patch will die and then there will be NO ROYALTIES at ALL!and he will have a lot of angry starving homeless people to deal with!
RRE3652 Mr. Stelmach, The current proposal for an increase in oil and gas royalties in Alberta will undoubtedly have a negative impact on this province and its people if implemented. An increase in royalties will inevitably reduce the amount of activity on Crown lands throughout the province, reducing the number of parcels that Crown royalties are paid on. Couple this with a current decline of about 30%, it becomes very evident that in the long run, the province stands to lose money from Crown royalties over the long term if this new scheme is accepted. It is a negative feedback loop which will hurt this province, not help it. Furthermore, I hear things on the news like “what’s good for industry vs. what’s good for Albertans”. This statement, and others like it, implies that the people of this province, who are the backbone of the Oil and Gas industry, are not Albertans!? This industry was founded and built on the sweat and hard work of Albertans Mr. Stelmack. We are the industry, and most of us, directly or indirectly, rely on the moneys that this industry generates to provide for our families. Implementing this proposal will certainly be a grave site for this province and its hard working people who made it what it is today. [Information Removed]
RRE3653 Our family hope you increase the Royalty taxes. Oil Companies have been getting Alberta's resources for much less than market for too long. Additional royalty taxes will help pay for the roads, hospitals, etc required as a result of the boom. Many of us have been hurt by the boom - our rents have escalated, receive less in terms of gov. services. Our salaries have not kept pace with inflation. Please increase the royalties - high oil prices are here to stay. Thanks [Information Removed]
RRE3654 It's the people's oil. The suggested royalty rate is fair. If the oil companies feel that they are being shortchanged, let them find another environment where they can make as much money as they do in Alberta. Any capitulation to the oil companies will reflect very poorly on the political leadership of the Stelmach government. We need strong leadership - the kind that Danny Williams provides his province.
RRE3655 Hello, I am a senior computer consultant and have been living and working in Calgary since 1998. I would like to let you know that the threat that the oil companies would withdraw funds by scrapping projects in response to the proposed new royalty rates is most definitely true and has already begun. I had a contract with one of the larger oil companies in town until the end of Jan 2008; however this company has cancelled my contract since there are no new projects or work going on within this company. These wouldn't be the billion dollar projects that they have been speaking of, but the projects that are a half a million and less. The end result is the same in that I am now out of work and the prospects of new employment are not looking good. In my search for work, I have found that most if not all companies are waiting to hear whether or not the new royalty rates will be imposed. These same companies are implying that if the new rates are imposed then there will be a continuation of no new work. If new royalty rates are imposed on the energy companies operating in Alberta, this will not result in a gain of billions to the government and the people of Alberta, but a crushing blow to the economy. A blow similar to and if not worse than when the federal government implemented the National Energy Program. The impact would obviously trickle from the large oil companies down to their employees and consultants such as myself, and further down to people even in retail and service industries. I and my family have enjoyed living and working in Calgary. However, if you raise the royalty rates I could be forced to leave the province as there will be no work for me. [Information Removed]
RRE3656 Why should big oil get to keep lining their pockets with Albertan's money?
RRE3657 I wish to voice my opposition to the proposals of the recent Royalty Review. I believe these changes would carry real risk of serious economic decline. Add my name to the list of those opposing changes. [Information Removed]
RRE3658 I am not the type of person that usually gets actively involved in political debates. However, I have serious concerns about the direction that I perceive the Alberta government may be heading with regards to the oil and gas industry. I am one of the many (some say 1 in 6) Albertans who works in the oil and gas industry. Therefore, you may think that I am biased. However, I believe that I have a somewhat unique perspective on the potential impact of increasingly negative government intervention in the Alberta oil and gas industry. I worked for a small start-up company from 2000-2003 that found itself focusing its development growth in the province of Saskatchewan rather than Alberta because the opportunities were greater and it was easier to talk to regulators when we had questions or problems. Since 2005, I have worked for a Calgary-based company which is solely focused on exploration and development in South America, because we perceive that the Western Canadian Sedimentary Basin is overworked, overdeveloped and there are few opportunities for significant economic growth. I have read and agree with CAPP's response to the Royalty Review report. In particular, I urge you to consider their statements under "Fairness with facts". Do not be swayed by arguments that are based on unrealistic assumptions. Have you not seen the current statistics that clearly show that conventional development activity has suffered due to lower gas prices? Please realistically consider what the additional impact would be of increasing royalty rates. (CAPP data showing that at $7/mcf, which is a barely economic price, royalties would increase not decrease). Lastly, with regards to oilsands development, my biggest concern is the lack of grandfathering provisions for current projects. I think the last thing Alberta needs to be perceived as an unstable regulatory environment where project economics cannot be determined with any degree of reliability. Thank you for your attention to my concerns, and to similar concerns that I am sure will be expressed by many.
RRE3659 I am a 5th-generation Albertan, and proud of it. My family homesteaded in Alberta in the early 1900's and I come from an agricultural background. The oil and gas industry is THE primary driver of Alberta's economy. We've seen in days gone by how Alberta's economy and jobs react to downturns in the oil and gas sector...they are directly related. While I'm all for Royalties to the government for the Alberta lifestyle, I believe the primary reason for the Alberta lifelstyle is keeping people working and gainfully employed. Allow the entrupenurial spirit to come through. Oil and Gas companies re-invest the majority of thier cash flow back into Alberta. While increasing the royalty rate will, indeed, increase the amount of cash the Alberta government takes in annually, it will not be at the expense of the oil companies, they will adapt and live within thier economics, the true impact will come in the form of jobs, security, and lifestyle. The oil companies will simply not re-invest and allow people to go without work to control costs. Implementing the Royalty Reviw Panels recommendations carte-blanche will have an overall detrimental impact to Alberta. [Information Removed]
RRE3660 I work for a very large oil & gas company and in the last month since the royalty review report was released i have already seen first hand the economic damage it has caused the province of Alberta and it's citizens. I drill multimillion dollar gas wells in West Central Alberta. Since the release of the royalty review report, 9 out of the 10 wells i was to drill this year have been cancelled and 21 out of 21 wells i was scheduled to drill next year have also been cancelled. This type of action is also true for the other areas that are adjacent to mine. I believe that this may only be a snapshot of worse things to come if the royalty review is passed in it's entirety. The trickle down effect on my wells being cancelled include numerous job losses in the service sector, no money going to the hotels and restaurants that normally would be visited by the workers and so on. My area is only a small one, but the same actions are being initiated throughout the entire company and the entire industry. These measures are necessary and not merely threats. Why would anyone choose to drill a well that is not economical? If the suggestions made by the royalty review panel are honoured by the Alberta government, this type of job loss and economic downturn would be exponential. Forcing additional econmomic constraints on oil companies will not increase the governments share of the pie...it will do the exact opposite. Less spending on drilling activity and landsale postings will obviously have nothing but a negative effect on the governments share and overall economy. I hope for every Albertan's sake that the current government has the foresight and leadership to realize the significance of their upcoming decision. I also hope their decision is based on what is best for their citizens and not their poll ratings.
RRE3661 Alberta needs to review royalty rates and ensure that a fair share is given to the province. The energy companies and service companies have increase their profit and revenues, it is time for the province to do the same. It should be something that creates a reserve fund for the province and not directed into the general revenue pool. List to citizens of Alberta and not corporations or employees of the corporations. Thanks. [Information Removed]
RRE3662 The Socialistic under tone of this review is so dis-heartening it lends its self to days of the Trudeau Liberals. You talk of competitive position of our province with other energy areas, and you site U.S. states that enjoy much lower fuel costs at the pumps than we do here. Your concept of your fair share is very wrong, because do not tell me it is my fair share, you are saying it is your (government's) share. When I was 18 it was the first year of the age limit lowered to that age to allow me to vote. The vote for the Federal Liberals I made that year was the last vote they ever had of mine, Federal or Provincial. I will rethink that stance and not in your favor if this huge error in your persception of "our take " remains as such. The Oil and gas Industry has been my lively hood for over [Information Removed]years, I am the second generation in my family to say this. My father spent more than [Information Removed]years in this industry, both my sons are now in this industry. They listen to their father when they ask of things like this, and they listen when their father offers advice about these things as well. Think about what you propose carefully.
RRE3663 As a tax paying Albertan I am appalled at the fact you actually think Albertans aren't getting their fair share? When the PM says Alberta who is he talking about? I know it isn't the little people hence the tax payers...because all the taxes I pay out annually is over 50% of my net income per year..if Alberta isn't getting their fair share it's because of the astronomical amount of taxes we have to pay each year, so my conclusion is this..if you raise royalties does that mean our taxes go up? So who gets our fair share then?
RRE3664 To the Premiers Office: [Information Removed]is a diversified oilfield services provider who caters to the ancillary service requirements of the producing companies throughout the western Canadian sedimentary basin. Speaking on behalf of our company I can tell you that we share the sentiment of [Information Removed]and the entire oil and gas industry; both the producers and service companies alike. There is a growing concern that the recent royalty review is full of inaccuracies and outdated information that needs to be dealt with to ensure that the review does, in fact, compare "apples to apples" and is leading toward a set of revamped guidelines only if and where it is deemed necessary. The Alberta government needs take the stance of making well informed decisions and not simply rush to judgement to meet a pre-set deadline of an announcement in early October that has been suggested by the Premiers office. The Alberta government needs to listen to the industry groups such as [Information Removed]to make sure it has received input from the "true experts" in our industry when it comes to the rising input costs (increased finding and development costs) that have been experienced over the past several years in the western Canadian sedimentary basin to garner the information necessary to make well informed adjustments to the current royalty regime only if and when it is deemed necessary. The affects felt by our industry and Alberta's general economy if a proper analysis of this issue is not undertaken could be devasting to say the least. Specific to the royalty structure; we are concerned that conventional oil and gas producers need to be treated equitably with those that are involved in the exploitation of our oil sands regions. As I am sure you are aware, our conventional oil and gas industry has been hit particularly hard over the past 12 months with reduced drilling activity levels due to depressed natural gas prices brought on record high natural gas inventory levels. To put this in perspective, [Information Removed] has been forced to lay off approximately 20% (100 people) of its workforce over the past 8 months and we are not alone on this front. Although we feel that it will likely take another 12 months or longer for the supply and demand equation of natural gas to right itself, we are confident that our current workforce level will be required to sustain us for the foreseeable future. This of course could change should the industry take another devastating blow to its current activity levels brought on by a series of unnecessary adjustments to our current royalty structure. To summarize, it is our position that any "knee jerk" decisions that are made by the Alberta government without detailed input from the industry associations could have a long lasting and devastating affect not only to our industry but to the economy of the province of Alberta and our Country. We respectfully ask that the Premiers office takes time to truly understand all of the facts before making changes to a royalty regime that it perhaps does not completely understand at this point in time. In the end, if change is required they should be implemented based on accurate information and well informed decisions; not some preconceived deadline and misunderstood information. [Information Removed]
RRE3665 Dear sir or Madam I hope your STOP and give this royalty increase proposal serious reconsideration, come to your senses and abolish it!!! I would hate to see oil companies in Western Canada shutdown exploration here and move to area's like the US or north sea, just to mention a few. I like living and working in AB in these times of building and properity. This will result in a tremendus loss to the AB economy, when thousands of other middle to high income wage earners like me start working out of country paying about 30% less tax and or just keeping thier money in a foreign bank. I can't even threaten getting even with you at election time because it will be far to late by then. For god sake do the right thing and scrap this tax!!!!!!!!!!!!!!!
RRE3666 Adopt the report and raise the royalties . Norway has been in the oil business for 30 years and has a 180 billion dollar fund and we have a tenth and this resource is non-renewablour grandchildren deserve better. thanks
RRE3667 As a research analyst with a small Alberta-based energy service company, I have spent months pouring over thousands of pages of documents related to the royalty review. The Alberta Government should be commended for opening such a critically important issue to such wide-ranging public participation. It should also be condemned for meeting behind closed doors with the oil and investment industries. The review panel's report was serious and thorough; its recommendations were moderate. I have read every word of the oil and investment industries' criticisms, but very little of it do not survive scrutiny. As has been recently reinforced by the Auditor General, the Alberta Government has been failing Albertans on this issue for many years. The panel's recommendations should represent the bare minimum for the Alberta government. Any compromise towards the oil and investment industries' dishonest arguments would represent yet another failure for the Alberta government. Albertans are watching. Don't let us down again. We won't stand for it.
RRE3668 The National Energy Program in the early 80,s put our economy into a real tail spin and it affected everybody not just the oil patch , PLEASE dont let that happen by raising the royalties to high and put the industry into a slow down . Im a 30 yr realtor in Calgary and I know how much we all depend on the oil companies . I also know that the cities of the province are pushing for more infrastructure money . There has to be a happy inbetween here , dont get Greedy or we all will end up with NOTHING ! Lets not cut off the hand that feeds us !! [Information Removed] Calgary
RRE3669 When will Government, both Federal & Provincial, realize there is only so much meat on a bone before you are left with a skeleton. Economics are tight enough as it is on the majority of projects and the Alberta economy is slowly seeing the results of projects being cancelled, people are already losing their jobs, housing prices are starting to fall, companies are struglling to stay afloat especially on the service side that rely on the producing companies for their livelihood - I know because I'm a manager at a producing company and what used to be the occasional inquiry for work has ballooned into hundreds of phone calls a week from people basically begging for work. This will affect thousands of Albertans - see the mortgage crisis in the States, trust me we aren't too far behind especially if this royalty increase goes through. A number of the areas, specifcally the oil sands, have also seen working arrangements between producing companies and First Nations develop and flourish giving hope to a group of people, this will come to a drastic end with a number of bands looking at huge financial losses with the cancellation of these projects. Please don't be as short sighted as Finance Minister Flaherty when he doomed the energy trust sector with a so called tax fairness plan that sees our oil companies being scooped up by foreign interests and the people of Canada and Alberta left without. Sitting in my position lately I feel like a weatherman watching the perfect storm form with the potential to destroy our economy all the while the politicians smile at the camera looking to buy votes when the truth is with every bad decision they make they just add more power to the storm.
RRE3670 I do not think that you should raise the royalty. The price of oil is up around th $80 mark but if you look at the bottum line is there more take home pay now or was there more take home pay in 1980? I think that is were you should be looking first before you decide to do anything. Rasieing the royalty will force some companys to shut down or slow down then that in turn will evect the rest of Albertains as a whole. There will not be as much spending on any thing and there will also be an increase in Unemployment.
RRE3671 Premier Stelmach: It is important that Albertans receive their fair share of royalty income from provincially owned natural resources, which belong to all Albertans. Planned, orderly development, which takes into account the welfare of all Albertans as well as preservation of our natural environment and concern for effects on global warming, is essential. I therefore urge you to accept the recommendations of the review panel which you appointed. [Information Removed]
RRE3672 If they are sucking our planet dry they better [Information Removed] well be paying for it.
RRE3673 Although the Panel report says Albertans should be receiving more from their resource one must remember the spin off benefits from a reduced royalty. Economic growth over the past years as well as the smallest unemployment rate in North American jurisdications should be ample evidence. Look no further than our neighboring proivince to the east to see what an unfavorable economic climate does to stimulate growth. As a Tory supporter since I could vote, my vote says leave things alone!
RRE3674 I would like to state how personally disappointed I am with the possibility of the recent royalty review being adopted. I am currently a 2nd year geology student at the University of Calgary, where, like most universities, September is the busiest month for applying to summer jobs to develop our experience in our future careers. Whether those jobs are focused around oil and gas exploration, or with hydrogeology issues, the majority of companies hiring for these summer positions are the same companies who have just recently pulled out their funding to hire summer students and after grads. Myself, as well as other students, were recently contacted for several summer jobs. These jobs are very difficult to get based on competitiveness, however the hard work paid off two weeks ago when the companies contacted us. However, many of us have heard back from these companies this week because the summer hire program is yet to be decided due to possible job cut backs. I find this issue very concerning as myself and others have put all of our time into an education program, such as Geoscience, where so much support was given in the past 3 years (scholarships, bigger programs, more classes, etc). However, this current royalty review is greatly influencing myself to consider taking my last 2 years of the degree elsewhere, in a province with greater opportunities for students, as well as careers for after grads. I personally feel this Panel will have a negative effect on Alberta already prosperous economy leading to a downfall in further development. I also feel there needs to be more industry involvement when a Panel such as this is proposed. I am just so upset with this proposal; I spoke with many other students at the University of Calgary today, all whom are upset with this possible adoption. It would be ridiculous to go through with the proposal such as this, which would lead Alberta into such a devastating downfall. Sincerely, [Information Removed]
RRE3675 Recommendations seem reasonable. Should make royalty more fair to everyone.
RRE3676 I totally agree with the panel. Notice that the Albertan government time after time falls in the lower quarter of government take. Simply put, Alberta can afford to raise royalties and still maintain a competitve price for natural gas, conventional oil etc. . If your job instills what's best for Albertans, than you should LISTEN TO THE PANEL and raise royalties. Thanks for your time.
RRE3677 As a resident of Grande Prairie I have to admit as the proposal sits today with the recomendations I am very concerned. I understand the need to review royality rates on "large projects" such as the Oil sands but after looking at the potential impacts to our community I am concerned. As conventional gas and oil have already seen a slow down in 2007 due to the cost for services and strength of the Canadian dollar this would further degrade the activity levels which in turn will impact every resident in this community and NW Alberta. Compairing Alberta to the rest of the world when it comes to royality rates is only a small part of the Picture ( Or Pie as the committee have stated). The oil and Gas companies look at the ROR ( Rate of return) On capital. it's been communicated very clear that over the past few years the Western Basin Sedimentay has become the highest cost to find and develop our resources. This will just drive another Nail in our coffin!! Lets work together to find the "right answer" for all involved and not continue down the road to further reduce the amount of Capital these companies are investing in our province. One last point I wish to make. The report states " Record profits" but says nothing about the 100% reinvestment back into finding new reserves. I have to admit. Based on the information I have recieved the Government has a lot more to loose than the 2 billion dollars they are stating the residences have been shorted. These companies will take their profits from the existing resources they produce and reinvest in areas that they get a better ROR. Taking away royalities the Government recieves today. I have also not seen any documentation as to the amount of money these companies have invested in 'Programs" IE GHG reductions , environmental compliance. Again this amount is huge. An area maybe being overlooked by our Government.
RRE3678 It is time Albertans started to receive more compensation for the resources that belong to this province. Albertans have been before the oil companies came in and will be here after they leave. In the grand scheme of things a higher oil royalty rate is a very small thing to ask for - don't let Albertans down.
RRE3679 This is so typical. The title of your report alone "Our Fair Share" suggests complete bias and will become a self fulfilling profecy. We little specs of nature are ever so willing to accept "Our Fair Share" aren't we? Frankly, you are appealing to our lowest common denominators...our apathy and our covetousness. And no doubt you will get it. Even if you put it to a vote, "Our Fair Share" will have every Albertan singing the praises of those politicians that finally heard our plee. For now anyway. Frankly it's nausiating and frightening. Does anyone remember the NEB and the 80's???? Alberta right now is enjoying the lowest unemployment rates in North America, no sales tax, the province is debt free and generating annual surplusses that are the envy of all of Canada. Companies are generating billions of dollars to keep this economy strong for the future. It is reasonable to believe that if the government decides to run with the 2007 version of the NEB, (I suppose we should call it the PEB), those same companies will be able to afford to continue this investment? This will leave Alberta in a state of eventual decline. Sure, your panel is a very intelligent group of people, no doubt, however, I cannot believe that they have considered some key facts in determining their findings. A key argument in the report asserts that goverment takes in other countries are much higher than in Alberta. Ya think??? Did they bother comparing cost structures and reinvestment levels? It does not appear that they did. Nor does it appear that there was any consultation with the industry leaders. Before you implement this recommendation you may want to consider doing just that. I know that this email will go completely unnoticed and most likely unread, and after I've sent it, I will undoubtedly forget about it too...for now. And well...I'm as apathetic as the next person, although I do vote, and my long term memory is very good. Sincerely, [Information Removed]
RRE3680 Accept the recommendations you have been given by the Panel, and increase the royalties collected by the Province. It's high time the royalty rates were moved closer to what those in other jurisdictions collect. Call Big Oil's bluff. If they decide they want out because the rates are too high, someone else will gladly come in to pick up where they left off.
RRE3681 I would like the government to be very careful, in their decision in reguards to the royality review. Many jobs are at risk of being lost if higher royalties are placed on the oil and gas sector. Alberta is an oil and gas province, and if the oil companies move out of alberta, will alberta go into a depression? I think the answer is Yes. Alberta has been getting there fair share for years and why is this so important now, is the government getting greedy. what is more important, letting people work and make a living, or collecting royality checks? Be careful on what you decide, i do not want to go through a depression this late in my life.
RRE3682 this is the stupidest thing ever been thought of by an Alberta premier. I can't believe that our premier is even considering this. Sask. is praying that we do this so these companies can go and start drilling in Sask. I wonder what the Alberta going to do with the extra $2B, I live in Airdrie Alberta, so I hope I get a hospital in the 30,000 people city. every aspect of our Alberta businesses happen because of the oil and Gas industry. my house doubled in price in 4 years because of the Alberta oil and Gas. I work for a Telecommunications, now you might think that this has nothing to do with oil and gas so this business should survive. well, you're wrong most of my customers are [Information Removed]. [Information Removed]are my customers as well, but they wouldn't be in business if [Information Removed]etc...lay off 10's of thousands of people. bottom line, as a resident of Alberta which I love, I urge the premier and his gov. think of our great province and think of the great economy that we all enjoy because of this industry and finally think about the RIPPLE EFFECT of your decision. [Information Removed]
RRE3683 I think Mr. Stelmach better think long and hard about the consequences of his decisions. I have read info on the royalty review and it seems to me that alot of the information that Mr. Stelmach was provided with was not up to date. Alot of facts were based on old information. How can you make a decision when the info. you are given is not even up to date? It is fine if the royalties are increased but it better be phased in on a bases that is fair to everyone. The so called Alberta Advantage has alot to do with the successful drilling and production in the oil and gas sector. If you make the wrong and unfair decision it will hurt everyone, even you the government because the drilling will stop and the money will stop. Think, before you speak
RRE3684 I'm not in favour of increasing the royalties taken from oil producers. It would result in higher fuel costs, a weaker economy, and a slow-down in oil production. Also, from a moral perspective, the oil doesn't belong to Albertans in general nor to the Alberta government. It belongs to the companies that take it out ot the ground and make something useful out of it. We don't claim that a farmer's produce belongs to Albertans. It belongs to the farmer, who works the land and produces crops from it. The same principle applies to the oil sands. The oil producers do not owe money to anyone for the oil they remove from the ground. Left in the ground, it is of no value to anyone. The oil companies make it a value by mining and refining it. It belongs to them. Let's also consider the fact that Alberta's economic growth is largely due to the productiveness of the oil and gas sector. It is quite a slap in the face to start taking away more of their money after they have made our economy strong. [Information Removed]
RRE3685 I just want Mr Stelmach to know that most of us realize the oil companies are bluffing and if they do withdraw some investment it would actually help lower the inflation rate of this province, making it somewhat more affordable to live. The resources are ours, not theirs and if Mr.Stelmach wants to win an election he should adopt the $2 billion increase in royalties as the bare minimum. Waffle on this and do something stupid like splitting the difference between the status quo and 2 billion will result in me and all my family to vote liberal. This number is 7 votes. Maybe not substantial to the conservatives but I'm sure Kevin Taft will appreciate it. The talk everywhere is that you will give in to big oil, but will lose many many conservative voters if you do. Tread carefully in these waters, Premier.
RRE3686 As CFO for a mid size industrial contractor (1500 - 2500 employees) active in the Alberta Oilsands I feel it behooves me to make the following points: 1) Alberta's current financial health is excellent, second to none anywhere in the whole world therefore higher taxation is not currently required 2) The current surpluses have been built primarily on business and income taxes NOT on Royalty Revenue 3) Royalty revenue generate income into the governement's hands while industry investment creates jobs and puts money into the hands of businesses and their employees who in turn reinvest that money back into the economy thus turning over several times including into taxes for the government 4) If a Royalty regime change is contemplated it should focus NOT on making Alberta less friendly to business investment but it should be focused heavily on penalizing those that would import our raw resources and the jobs required to process these raw resources out of Alberta. I can be reached at my office at [Information Removed]if the minister or someone from his office wishes to discuss this matter further. [Information Removed]
RRE3687 You should accept the report as submitted, and not succumb to pressure from the petroleum industry - they had their fair chance to provide input as park of the review process. [Information Removed]
RRE3688 I am a retired Oil executive and currently sit on the board of 2 public listed oil and gas companies,one of which is active in the Alberta oilsands development. I am totally against the proposed plan and think the damage it would cause would be irreversable. Changing the rules after such incredible amounts have been invested is not the Alberta or Canadian way. Among other things billions of dollars have been invested at Alberta crown lease sales over the past few years on the basis of what the rules were at the time. Bonus's alone are like a "voluntary " royalty because they are discretionary and it is fair to say if the rules were changed to what is proposed these bonus' would not have been so generous. In other words you have already received a lot of funds by way of "prepaid royalty". You are not going to get both- high bonus' and high royalty! Because politically you are going to be forced to do something, I suggest you grandfather all leases already issued and reduce the proposed increases to something much more modest than is being proposed. Because of the oilsands projects and their importance to the international supply picture we cannot afford to lose our credibility. We are on the International stage for the first time for good reason and we cannot afford to [Expletive] it up by changing the rules now. Any reduction in development of the oilsands will have a dramatic economic effect on all Albertans AND most of the rest of Canada as a lot of the equipment and supplies come from all over Canada . Respectfully submitted. [Information Removed] Calgary
RRE3689 Dear Mel Knight, thank you for reviewing the oil and gas royalty formula. All the research I have read indicates that Alberta has long been underpaid for its oil and gas resources. The conservative govt of Alberta has to look at the public good in these matters and it seems in the past there was much more concern with industry profits. I am aware that it is difficult and dangerous as a politician to anger powerful industries such as the oil and gas industry. It is easier to give them what they want and reap the financial and press rewards that they will provide. However, this step on your behalf demonstrates a great deal of integrity and I applaud you on this. You can expect my support in the coming election if you follow the recommendations to increse royalties to the level stated in the report. Thanks for your ear, [Information Removed]
RRE3690 Personally I agree that more royalty should be collected from the most profitable (once they actually start producing, as risk reward would dictate that you have to spend to make it in this business--"kinda like farming") components of our province. It should not however, be brought in in such a manner as proposed. Ramp up slowly and allow for the companys to better plan future projects based on future royalty payments, market conditions, global events etc. I feel that the amount of royalties collected should fluctuate with current market values as well. if you come in too hard too fast, they will simply shut out any new plans for development, as well as turn off any marginal producing elements because input costs would not justify operating them. Which, I think would equte to LESS royalty for the province??? No wells = No royalty?? It concerns me that our own government may put me out of work, and many other provincial tax payers for that matter, because the companies we work for would need to lay us off due directly to our governments actions.
RRE3691 As seniors we, who helped build Alberta, stand to lose much more than we'll ever gain if this royalty review goes ahead. We have never recovered from the NEP!
RRE3692 I feel that Alberta's economy will be drastically effected (Negatively) if this royalty review is implemented. I also don't believe the government calculations are correct, I think their estimates are grossly undercalculated. [Information Removed]
RRE3693 There needs to be something done here, this will affect alot of people. Not only does the royality review effect the oil companies it effects the goverment of Alberta as well. Below is a list of examples: 1.) In the end the goverment loses because oil and gas companies with refrain from looking for new development in alberta which means decreasing reserves on currently depleting oil and gas wells. No new royalities due to no new exploration and development. 2.) Loss of jobs for alot of albertans. So many people will be effected directly and indirectly. Alberta's Economy is at stake due to people will move else where to work and less people will be investing into albertas market. 3.) The royality review panel provided old data from 1998. You need to give the oil companies a chance to gather all the information to provide the right facts to the panel and the goverment rather than working off of old data. 4.) The oil companies dont disagree with the fact that royalities need to be raised due to the commodity price. They are looking for a fair middle ground where both parties can agree. The current royality proposal is outrageous and will hurt alot of companies, familys, the economy, and etc. We have not even seen the worst of this yet. 5.) Poverity with increase worse than it is now. In conclusion please help find a middle ground and take these concerns into high consideration. Be fair and help all the albertans out in maintaining a sustainable life style.
RRE3694 Our enconomy is dependant on risk investment from Oil Companies. I have 20 empolyees employed in the conventional oil industry, and I'm sure you are aware, activity is slow in these segment of the patch, primarily due to the high dollar, low gas prices and uncertaintity on Royalty Reviews. If things do not change in near future, I will be forced to lay off employees. We do not need an increase in royalties to the conventional oil industry, where the risk is high for exploration. If anything, increase royalties to tar sands where there is little risk, as the R&D and capital projects are pretty much completed. The Alberta economy was developed on free enterprise and rewards for risk takers. Please stand firm for these principles. Sincerely, [Information Removed]
RRE3695 Fred Dunn probably did a good job auditing the AB governments expenses. But is he at all qualified to be making statements about appropriate royalty rates? Does he understand industry and capital and operating costs, heavy oil differentials, etc., etc.? Does he understand the huge investments made by companies? Has he examined the issue in depth like Pedro van Meurs? I'm guessing no, in which case he should be reined in, as his comments are misleading. Reined in or fired, probably the latter.
RRE3696 The information the government is basing this on is 2005 data. The Alberta gas industry is already in a slump. Well count is down which is a huge impact on the economy already. With the rising dollar (cdn vs usd) and the us drilling record new drills where is the natural gas from alberta going to be sold to. I think the rolalty tax is a good thing but very bad timing. This could set us in a depresion that would take years to recover. What would this do to alberta. With the rising cost of economy, USA drilling more gas wells, and the cdn dollar at par with the USA dollar. tHINK ABOUT WHAT YOU DOING TO A GREAT PROVINCE. [Information Removed]
RRE3697 I live and work in Fort McMurray. I don't believe the oil companies when they say that they will shut down their operations if the royalties paid to the government are higher. They will be making less of an enormous profit, so will actually increase production to attain the same level of profit. Besides that, where would they go? Its not like a factory that they can re-locate, the resources are here. The oilsands and other oil and gas resources are the property of all Albertans and we should take our share. The oil company employees making hundreds of thousands of dollars a year may have to take a minor pay cut in order for money to be spent on schools and seniors and healthcare. Please don't back down -- but spend the money wisely when it comes in.
RRE3698 Premier Ed, You have embarked on a process with the Royalty Review that can make or break your career. You can't stop now. It is time that Alberta and Albertans decide how our future should unfold and not the Oil and Gas companies that are trying to persuade you otherwise. It is time that you decide and make a decision as put forth by the panel. I want to leave my daughter the best Alberta we can. Just remember that if you do this that there are more Albertans that can affect a future election than a few "fat" oil executives. It is time to bring costs, like housing and wages, back in line to promote long term growth. Many businesses regardless of size are struggling to fill all positions. [Information Removed]
RRE3699 I am very concerned these proposals will kill the goose that lays the golden egg. As resident, home owner and worker in the resource industry in Alberta, I am worried about employment and the value of our best investment=our house, which we recently purchased at the peak of the real estate market. If these proposals go forth, these proposals will cause negative growth in an industry in which I work in and will hurt the economy, my job prospects and hurt our housing price which is our main investment. If these proposals go ahead, we would seriously consider voting for another party in the next election. We would also consider picketing or peaceful protesting if the proposals come in effect. These proposals could negatively impact the economy. Remember what the Liberals did to Alberta in the 80's - is that how Mr. Stelmach and the current Alberta PC party wants to be remembered - as the only Alberta premier and PC party to kill a well-functioning Alberta economy? Wouldn't it be ironic if the Liberals had to fix the economy this time around? Please explain to me - why should I lose my prospects and the value of my house? Concerned yours truly, [Information Removed]
RRE3700 The recommendations in the report are far too timid, and do not go nearly as far as they could or should in terms of capturing fair value for Albertans' resources. Implementation of the panel's full set of recommendations is the absolute minimum the government should do.
RRE3701 The proposed royalty changes would materially harm the shareholders and employees of our small Calgary based oil company. We took a big chance and spent over $50 million on exploration in Alberta and the changes and eliminations of the deep royalty holiday that was a key element to making us decide to keep drilling and make a notable, rare, very expensive, high deliverablity gas discovery (after several expensive dry holes) would mean that we probably never recover our investment. If royalties are raised I intend to calculate how much money has been confiscated and write letters to each of our shareholders to show them what they each have lost due to the actions of the Conservative party. I will also pay for an ad in the Herald inviting all other small companies that are the victims of these reccommendations to also contact their shareholders in the same way. Our shareholders are mostly small investors including teachers, farmers, firemen, service people people, you name it, etc and most of them are Albertan and there are hundreds of them. They have patiently bought and held on to our stock as we explored for oil and gas in Alberta in the hope of getting a return, which so far they have not gotten. They are not international fat cats. For your information, exploration now is much more difficult and expensive than in the past because the size and quality of the reservoirs is much smaller, and we need higher gas prices even with the current royalty regime to hope to get a return on our investment. If anything, gas royalties should be reduced if you want exploration to replace dwindling gas volumes in Western Canada. If you "Conservatives" choose to unilaterally change the rules just like third world banana republics or communists after people have invested their hard earned money, I intend to do everything I can to show the people who lose their money (and jobs) who is responsible. Then maybe you will also lose your jobs after the next election, like so many other hard working people who would be adversely affected by an unnecessary and greedy money grab by your government. Sincerely [Information Removed] Calgary
RRE3702 I'm an independent contractor involved in oilfield construction, I live in rural Alberta, I contribute almost 100'000 dollars yearly in both personal and business taxes. Me and my family live comfortably due to income gained through the oil patch, we are NOT millionaires like some of the Stelmach government seems to think, we (oilpatch workers) contribute heavily to our respective communities. The royalty review is threatening our livelyhoods, now I realise that if this e-mail was sent to [Information Removed] it probably wouldn't have much bearing on his fiscal decisions, it probably wouldn't even make it to his desk. But the fact of the matter is that there are approxiametely 500'000 of us (oilpatch workers) who's fates are hanging in the balance. This royalty review will not affect the major producers i.e; [Information Removed]etc... these companies all have operations outside Canada that are thriving. At any given time there are approxiametely 15'000 to 20'000 workers employed directly in the oilsands region near Fort Mcmurray. Capitalism tells us that if profit drops so should expenditures, so, how much income tax and "spin-off" revenue would the current government like to lose? Alot of us may be forced to move to other provinces or even the US if we can't "feed our families" in our home province.
RRE3703 I consider it fairly simple: The people of Alberta deserve their fair share of the wealth that is being made from our resourses. It is up to the provincial government to keep the best interests of Alberta and it's future ahead of fat-cat oil companies who are complaining of a potential hit to their profits.
RRE3704 I would have to say I disagree 100% in your idea to raise oil royalties. This province thrives on oil and gas with 1 in 3 families directly affected. With the announcment you have made just thinking this through, oil production has slowed. You are who you are and Ralph is a tough man to follow, but is this royalty tax proceeds this will be political suicide. Hope you make the right decision. [Information Removed]
RRE3705 I think it is appropriate that Alberta increase its royalties to bring them into line with those levied by other jurisdictions. I have heard reports that various oil & gas exploration companies have made threats to shelve/delay projects if the government does increase royalties. I actually think this is a GOOD THING as I think it will moderate the amount of activity occurring in this area and serve to COOL OFF (somewhat) the inflationary pressures being experienced in many parts of the province. I think that the province's energy resources are a legacy that belongs to all Albertans (past, present & future); I do not think the opportunists of today should be "stealing" (in a sense) from the people of tomorrow who will continue to build our province & make it great. I think the government should be taking a long term view of how these resources are developed & exploited and that it should not bend to short term pressures of entities that do not have the same interests. Although I am not 100% clear on this, it is my understanding that US-based oil companies have strategically planned to leave some of their resources in the ground and instead develop extra-national resources. The intention of this being two-fold: 1 - to develop the national resources at a time when prices are very high; 2 - to maintain security of supply (in the long term). I think the Alberta Government & the Govt of Canada should be thinking in strategic ways like this also.
RRE3706 It is time to INCREASE royalties. These are our provincial resources, and we're giving them away right now. Edmonton's roads are falling apart because our infrastructure handles every truck that rolls up north, yet we're not compensated fairly. I am not comfortable with a royalty scheme that is more favourable to business than to citizens, period.
RRE3707 The royalty review should consider the thousands of jobs lost if the money they are asking in return is passed. As a contractor for oil patch I hope there will be free government grants for career training, I rely on the oil industry to provide for me and my family, as it stands the bank can have every thing. The Alberta oil boom is not in a boom its at its feet and 2/3's of this province will likely be unemployed, there are hundereds of contractors and qualified trades that are already unemployed due to this review cause the big energy companies are cutting back there spending. Those are my thoughts, dont change what is not broken.
RRE3708 Mr Stelmach has the opportunity of becoming as popular with Albertans as Pierre Trudeau was after he brought in the NEP and triggered an economic collapse in Calgary.
RRE3709 I disagree with the royalty review for the simple reason that I don't believe Albertan's will actually see any of this money change our province in any substantial way to make it worth while of running oil company's business out of the province. I personally, along with thousands of other people in this province, see more money from the business the oil companies generate by earning my daily salary in an oilfield related job than I will ever see with the Alberta government lining their pockets with an additional billion dollars. I would be willing to bet that any extra monies received by passing this review, will not cover the rising costs of unemployment and welfare in 2008.
RRE3710 I would rather see busines provide jobs and tax dollars to Alberta rather than Gov decide where to spend it. The royalty will discourage growth. Look what happend in Sask and BC. They started following our royaly now we are going to change it? Not Good bussiness. Thanks [Information Removed]
RRE3711 I think the report 's authors went well beyond their mandate. While there may need to be minor tweaking to the royalty structure for oilsands, there is no need for a major overhaul of all Crown payments as this report proposes. After the federal income trust decision, changes to accelerated depreciation, as-yet-unknown Kyoto Protocol requirements, the spillover from the subprime mortgage lending crisis, and the incredible escalation in labour and other input costs, the oil and gas industry cannot possibly shoulder another blow. If this report's recommendations go into effect, Ed Stelmach will be remembered as the Premier who killed the golden goose.
RRE3712 I AM AMAZED TO HEAR THE OIL & GAS COMPANIES SAYING THA T THE ROYALTY REVIEW COMMISSION DID NOT GET THEIR FACTS RIGHT. SURELY THEY KNEW OF THE REVIEW AND IT WOULD BE IN THEIR BEST INTEREST TO ENSURE THRU REPRESENTATION FACTUAL COSTS ETC. THIS FAILURE LEADS ME TO BELIEVE THAT OIL & GAS DIDNT EXPECT WHAT WAS PRESENTED AND NOTHING WOULD COME OF IT.IN ANY EVENT I SAY WE ADOPT THE FINDINGS AS PRESENTED . [Information Removed]
RRE3713 If you are going to make changes - get ALL of the facts - Albertan's suffered when the NEP came in, is this Alberta Government going to shove new policies down our throats without properly evaluating the entire situation only to send us into another economic disaster?
RRE3714 Thank you for visiting the Alberta Government feedback web site. Following is the response to your question prepared by Energy [ENERGY] On 2007-10-03 10:23:00.0 you wrote: Will these royalty changes be administered to existing contracts? We should not be able to change the rules after a contract is signed. Energy responds as follows: This will be determined once the government response is completed in October. Thank you. Were you calculations based on applying these changes retroactively to existing contracts?
RRE3715 The independent royalty review did an exhaustive review of the royalty issue and the impact of raising the rates on the energy industry and came up with a very fair recommendation in my opinion. The energy resouces do belong to Albertans and it is high time that we received a fair share of the profits from same. The energy industry for too long has benefitted from our low royalty rates and have made billions at a price that our infastructure, schools, hospitals and social programs have had to pay. Norway and Alaska have received far higher royalties for many years so why are we hesitating to raise our rates??? PLEASE DO NOT BOW TO THE ENERGY INDUSTRIES whining and threats of moving out of province - after all where would they go??? Venezuala???? As a Senior I am most concerned that the grandchildren have a future in this province but giving into the industries demands will only bankrupt this province in the longhaul - we must look after the future!!!
RRE3716 Please do not let the Alberta government be held hostage to the oil and gas companies like [Information Removed] who threaten to cut spending if they don't get their way. If they do not want to invest their money under a new, fair royalty scheme, that's up to them. However, they should know that that leaving a little more oil or gas in the ground only means that there will be more available to collect in future years or possibly even in future generations when the price will likely be much higher. Fossil fuels are a non-renewable resource. They will be exploited eventually, and Alberta should get a fair price for them when it happens. I work in Calgary as a contract software developer in the oil and gas industry. If industry companies cut back their spending (even if only out of spite), this may mean less work for me, at least in the short term. However, it would be worth it, especially as it would likely mean a strong Alberta for my children.
RRE3717 We have read and listened to much debate on this subject and wish to express our strong feeling that the government of Alberta must act quickly to revise the rate structure to ensure that we Albertans are receiving much more than we have in the past. We do not for one minute feel that the threats made by the oil companies and[Information Removed] will do any permanent damage to the Alberta economy. A slowdown will not hurt - I visited the Fort McMurray oilsands area this past summer and was appalled at the scale of the devastation happening in our province - all to increase the profits of the already rich oil companies. We are both in our 70's and have lived and worked in Alberta our whole lives. Let me mention that the present boom is not helping those of us who are living on fixed incomes (pensions). When the OAS is increased in accordance with the cost of living increases - it does not reflect the increase in Alberta, does it? We trust you will give this careful consideration. Yours truly, [Information Removed]
RRE3718 I work for a service company in the oil patch and I have a really bad feeling about the pending decision by the government. The industry is already in a serious tailspin. In the last year, our company has seen a reduction in business by 40%. Lay-offs are being considered. Energy companies are holding off work pending your decision. Don't [Expletive] this up. Albertans will be hurt if you do. Royalties should be lowered along with all taxes, you're already running a massive surplus which is simply OVER TAXATION. My vote in the next election is at stake for you. Get it right, Alberta is not Venezula.
RRE3719 I think that royalty rates should rise. However there must be some caution. I think that the rates should be dependant on the price of oil and natural gas. perhaps put the new rates on any oil above $50.00 and when gas is above 8.00. Also encouraging refining of bitumen in Alberta will help the economy
RRE3720 To Gary Mar ([Information Removed] MLA), Please increase the royalties Alberta charges to at least the world average. The oil and natural gas producers can threaten all they want about cutting exploration and production spending, but these business people are not stupid. Who would leave a safe, reliable and stable place with close proximity to the US? They know they have to pay a premium for such a good opportunity. What other areas of the world will they move their money, the Soviet Union, Venezula, Nigeria or Indonesia? As a shareholder of these companies, I'll ensure that they put my capital to good use in Alberta. [Information Removed]
RRE3721 Hi, I just wanted to say I think the government should have done more research on this, and weigh the pros and cons, as this to have such an effect that hundreds even thousands of people to lose their jobs. How would that get this province or country ahead? Thank you
RRE3722 please stop giving away our companies! Where do you gain? Youare not going to get the taxes you have been getting! Why do you let people come in and take your resources!
RRE3723 I DO NOT support the dangerously short-sighted recommendations of the royalty review panel. I believe in Capitalism - NOT SOCIALISM. The Alberta Government already enjoys a surplus. If these recommendations are implemented I expect to see MY FAIR SHARE, in the form of reduced provincial personal income taxes. Thank you.
RRE3724 i am no expert, but i do have a fair amount of western common sense and i'd like to share some of my opinions on the matter. In the world today, energy supplies seem to be located in 3 types of regions: 1. Chaotic regions like the middle east and africa where there are huge risks of supply interruption and massive military spending is apparently necessary to attempt to control the oil resource. 2. Completely sovereign regions of oil supply like Russia and Venezuela, which, because of the war in Iraq, have consolidated and nationalized much of the oil industry in their respective countries. They can nationalize the oil industry because no other country has any military or political leverage over them. 3. Friendly and safe regions that offer reliable supply like Alaska, the north sea, and Canada (more specifically, Alberta.) We in Alberta are blessed with a massive reserve of Oil and gas that Albertans own. And there is no doubt that our royalty structure is significantly less robust than that of Norway, Alaska, and many other American States. It comes down to pure economics. all of the major users of oil in the world like China, Japan, the US, Europe are in desperate need for a reliable source of oil in a very chaotic world. Alberta represents the most viable supply. the geopolitical chaos that is going on is driven by scarce resources and therefore it will go on for decades until there is no supply left or we've found viable energy alternatives. Therefore, investment in Alberta will NOT evaporate at all if the Royalty Review's recommendations are implemented. Actually, the sooner we install this long term consistent Royalty structure that is mutually beneficial to both the owners of the resource (Albertans) and the companies that are extracting it, the better for industry because there will no longer be that uncertainty. It is time that Albertans received our fair share of the profits from our resource. It's not owned by the corporations. It's owned by Albertans and as a democracy, our elected government represents the people. [Information Removed]
RRE3725 I'm concerned about the possibility of increase in royalty rates. I've been working in the oil and gas industry for 8 years now and it hasn't been the easiest job but it lets me provide for my family in a way that most jobs can't. Being away from friends and family for up to 2 months at a time is something that I don't enjoy but I've done it to secure my future. If the rates go up then what future do I have and what was the point of all that hard work? Many of my friends are in construction of new homes and a majority of the people buying the homes are in oil and gas. If the rates go up and the inevitable job cuts come there won't be as many people buying homes and the construction industry will suffer as well. Those people that think their job has nothing to do with oil and gas will be unpleasantly suprised when these royalty increases end up effecting them as well. Oil workers are infamous for spending money on goods and services but that will stop if they don't have a job. As a debt free province why do we need more money? Use the money that we have wisely and remember that Rome wasn't built in a day. Everybody wants better roads, hospitals... but those things won't do us much good if we don't have a job and I, among others, that are not from here originally won't stick around to see the outcome which will result in some serious problems for this province. I know there are many others in the same situation as me so please don't raise the rates and let us continue to build our lives and this province in a way that will benifit all Albertans. Thanks [Information Removed]
RRE3726 I would like the goverment to leave the royalty rates as is. I have no connection to a oil company and am just your average tax payer. I hear people complaining that this is our money ,yes but we already run a surplus I think we need to think how many jobs will be lost and how the oilfield money trickles down to supply companys and Ma and Pa operations. Why rock the boat let us keep the economy strong they take a lot of risk and deserve the rewards they reap. I know the Premier is in a tough spot but Mr. Klein had to make some tough calls as well everybody was mad in the 1990's when he cut healthcare but he was a hero and he stayed the course. Good Luck!
RRE3727 I would be strongly in favour of the Alberta Government adopting the recommendations as presented in the royalty review report. I believe this type of review needs to be completed on a regular basis, perhaps every 5 years, with the recommendations generally being adopted.
RRE3728 I am sending this letter to express my deep concern over the Alberta Royalty Review Panel Report. I believe that if the Alberta Government adopts the royalty proposals as outlined in the report written by the Alberta Royalty Review Panel, the Alberta economy will suffer a dramatic and devastating downturn. This downturn will not only impact oil and gas companies and their employees, such as [Information Removed] where my husband and I are employed, but will also negatively impact oil and gas service companies and as other sectors of the Alberta economy that are dependant on economically viable oil and gas exploration in the Province. Many large oil and gas companies have recently put forth statements and letters of concern regarding the recommendations of the ‘Panel’ as these recommendations are truly based on factually incorrect information such as with respect to the much higher costs of exploration in a declining basin as well as the lower productivity of wells on average in this mature basin than as outlined in the report. As it is, the majority of Alberta’s oil and gas projects are on the verge of being uneconomic due to these very reasons. The added cost of potential future environmental regulations, for example, as on greenhouse gas emissions have not even been addressed. In Alberta, we drill mainly low reserve, high cost, relatively higher risk natural gas wells. The Panel’s recommendations do not bode well for this kind of exploration and if adopted, will assuredly hurt Alberta’s economy. There are also major concerns with the Panel’s proposal of ‘no grandfathering’ of current projects in Alberta. After billions of dollars and many years of planning and preparation have been spent on projects like Canadian Natural Resource’s Horizon project, how can it be fair to have the royalty regime changed? In such a tight economic landscape, future investment in these types of projects in Alberta depends on initial, agreed upon royalty layouts. Therefore, with higher applied royalty rates, the industry will see dramatically lower activity levels. Any forward investment in Alberta oil and gas exploration will come to a severe halt if the royalty recommendations are applied. Oil and gas companies will not find it economic to pursue capital spending in Alberta. This will assuredly cause massive layoffs in the oil and gas sector, and the effect will trickle down to every Albertan citizen. In addition, the Alberta government will see decreased incomes from Alberta landsales and lease rentals, as well as a dramatic decrease in drilling activities and cancellations of future oil sands and heavy oil projects. If the province is not sustaining production levels in a basin where reserves are on a rapid decline, they will only take a larger cut of a smaller pie because production rates will not be sustained in an environment where exploration and development is not taking place. Please consider the impact on the people of Alberta if the Panel’s recommendations are followed. There will be a massive downturn in the Alberta economy, a considerable amount of people will be left jobless in the oil and gas sector and this will trickle down to every other industry. Capital investment will be severely cut in Alberta and, in general, people will be no better off than they are currently. Due to the loss of reinvestment in Alberta’s oil and gas projects, the Government will also be taking in revenues at a lower rate than projected. Please think of the future!!! Thank you, [Information Removed]
RRE3729 Comments on the Alberta Royalty Review Report As a resident and taxpayer in the province of Alberta, I wish to state my opinion on the Royalty Review Report. I believe there is room for change in the royalty regulations, if done with care. Peter Tertzakian stated it very well in the Calgary Herald editorial page (October 3rd), when he wrote "… we need to reassess royalty rates in the context of changing prices and cost, but not in a way that compromises our future and destabilizes what has taken 100 years to establish." As residents of Alberta, we recognize the need for a massive infusion of capital into our schools, hospitals and infrastructure. The petroleum industry provides a large portion of the needed income, in the form of royalties, taxes, as well as direct and indirect employment opportunities. Jeopardizing this income is not in anyone’s best interest, regardless of their role in our community. I disagree with the media's quick dismissal and charge of "Threats" when representatives of the petroleum industry have stated the financial implications of an excessive royalty regime. None of us would think twice about dropping a poor stock or mutual fund investment. Petroleum companies have no choice but do the same if their investments in one part of the world are no longer profitable. We are experiencing a five-year low in the number of wells drilled in Alberta. Costs have risen dramatically in a petroleum basin, which is in decline. We have seen investment money quickly goes elsewhere when the profit margins are slim. Petroleum royalties and the petroleum industry are complex subjects. I believe we need to improve communications and develop open, honest and less opinionated dialogue between government, industry and the public. With dialogue and understanding, we can make the appropriate changes to the royalty rates, which best serve the residents of Alberta and in recognition of a very competitive world market. Sincerely, [Information Removed]
RRE3730 It is beneficial for majority of Albertans instead of only oil and gas industry. Therefore, I totally agree to increase it as much as practically possible.
RRE3731 If the industry wants to go elsewhere, let them. As the world oil supplies continue to dwindle, our reserves will demand even higher value in the future. If Encana, or anyone else wants to "invest less", that's okay. We can barely handle our boom right now. Maybe once you fund our cities infrastructure, we can continue to sustain the growth. Whatever you do don't let the companies forecasts intimidate you. Where are they going to go? Iraq? Iran? Saudi Arabia? Canada is a peaful nation, not at war, and close to a huge consumer. Just make sure Albertans are profiting too as the report suggests.
RRE3732 Albertans deserve an even larger percentage than this. This is our resource, and even as it makes us richer, it doesn't compare to the wealth that is accumulated by big oil companies.
RRE3733 I am VERY concerned about the Alberta's Governments intentions regarding the recent Royalty Review recommendations. If these recommendations are enacted I have no doubt it will seriously negatively impact Alberta's economy immediately. This will negatively impact every Oil& Gas company, every service industry company & employee, every retail business & employee, every restaurant, hairdresser, bank, grocery store, gas station, mortgage lender, travel agency, car dealership and all the staff (you get my point). Not just in Calgary and Edmonton but every small city and town as well. I do NOT think this is what the Alberta Government Intended or wants to see!! The Government needs to review the Oil& Gas sector activity for 2007. Activity is already down substantially over last year. Imagine what this new act will do. O&G Companies are already building scaled back budgets in anticipation of this negative initiative. I believe the report has not portrayed the Royalty situation to the Alberta people fairly. Yes, simplify the Royalty process, yes, share the upside on highly profitable production (this needs to be clearly defined) but be cautions and fair not to arrest the less the highly profitable activity. The benefits that activity generates are substantial. I have so much more to say on this subject that I can not possible encapsulate it all in this email. I plead with the New Alberta Government to be reasonable, fair, non-sensational and well informed before making sweepingly impacting changes to the Royalty Act. Sincerely, [Information Removed]
RRE3734 Drop the recommendations of the the royalty review report! Don't undermine the industry and the tens of thousands of jobs that rely on it!!!
RRE3735 Sir It is with some sense of urgency that I write this letter. I am sure that the mailboxes, electronic and otherwise, are full to bursting with missives advising your office on the current royalty review. After reading the threats of the oil companies and the letters to the editor, which argue both sides, I was left reading the report. The only thing that seems clear is, that newspapers don’t sell on well-reasoned discourse. The boom was huge this time; I don’t remember any of the other one that changed the economy so drastically. Shortage of materials and workers are the hallmarks of the latest boom. This boom was driven by the oil companies spending like there would be no tomorrow. Tales of contractors being paid double or more,” to come work for us right now” were common. As a homeowner trying to get a qualified electrician to look at our house for insurance purposes it was nearly impossible. Now a few years later some of the same companies who drove this boom complain things are too expensive. It’s very unlikely the people who run these companies do not understand their impact on the economy. Economics seem to be the main concern of these same companies; my source of chagrin comes when they talk about the marginal projects. We will have to shut down project A or B if the royalties change. My source of upset is that the money to make these projects go came at the expense of the Alberta taxpayer. I am sure that the individuals in charge of these companies understand economics better than I do. It seems from my reading of the situation that royalties are based on production. In the case of [Information Removed] a billon dollars out of gas exploration, with gas such a low price does it make sense that they would scale these activities back anyway? I may not have an MBA but would blindly spending in the face of near record low prices for your goods make any sense? I am sure the oil executives that are decrying this royalty change are smart enough to know when to spend their company’s dollars. Oil sands are the new economic engine of this province and will pick up steam as long as it makes economic sense to develop them. [Information Removed] seems to want to scare the government into some weak compromise that will shut up the public and save [Information Removed] precious dollars. The province has successfully promoted the oil sands and the number of new projects planed or in progress shows this. However the impact on the communities and the infrastructure also are showing. Again we invested our capital in the hope that these companies could extract oil from the sand. They have very successful in this the profits of these companies, at least their websites share prices have shown, they have mastered the technology. My only source of discomfort comes at the number associated with the increase is 2 billon dollars a fair number? Again the media provides us with little clear direction. The report of the Royalty Committee seems to be a compromise number. Looking at what other jurisdictions are charging, even after the change we are still a bargain. I know the threats about the loss of investment and employment are frightening but we have to remember our partners, oil companies, really didn’t feel any change was necessary. One can only guess to their real motivations as suddenly part way through the discussion they acknowledged the need for change. One other suggestion I feel may be in order, an export tax on bitumen. The export of this raw material is not in any way helping sustain the Alberta Advantage. If companies do start to pull out we must remember the as a partnership, we still hold ownership of the leases. If they must be taken and resold to a more interested partner then I guess that’s just good business. Despite the Royalty Committee’s aversion to a grand fathering perhaps some sort of phase in or some other incremental phase in period maybe in order. We must stress that as a partnership between industry and government must be beneficial to both parties. Yours Truly [Information Removed]
RRE3736 The price of oil has finally made the oil sands profitable and has given a dramatic boost to our economy. Why take that away? We are one of the richest provinces in Canada, most of us are happy, why need more? Please don’t ruin a good thing.
RRE3737 Hello, I am shocked that the premier of Alberta is considering making such significant policy changes when he in fact he has not been elected by the people of Alberta, as a result, he has no mandate from the people to make significant change. I would suggest the premier and the government take a hard look at who employs the majority of the people in this province, it is the Oil and Gas companies. These companies are experiencing significant increases in their costs and it will get to a point where people will be laid off and then the government will have even less personal income tax money. It is beyond me why the Government would now penalize the Oil Sands companies when in fact there would not no Oil Sands industry if these companies did not take the risk so many years ago. For the sake of the economy in this province, it is my hope that the Government does not adopt this royalty review report.
RRE3738 I would like to say that it is imperative for the social well being of our province that the government adopt the royalty review recommendations. We are experiencing unprecedented economic development in our province. We need to change and adapt our fiscal policies in response. It is the responsibility of the government to ensure that our natural resources are not squandered, but are used wisely and that future generations will benefit from them. It is a one time deal, once it's gone, it's gone. Thank you [Information Removed]
RRE3739 As a fellow employee in the oilfield, I cannot believe that the government would wait until we are already in a slow down period to suggest changes to the royalty program. If anything it should go down as to invite the oil companies to move ahead and drill more! Did the government actually think they would make more money? If they up the royalty, the oil companies will drill less, which means less production, which means LESS JOBS for ALBERTANS. When the Albertans work less, they spend less. When they make less, they pay less income tax. So the extra money made in royalties will be lost in the income tax department. Use your heads and invite the oil companies back, keep the Albertans working in the oilfield WORKING. Many are already out of work, think about how many more will be added to that!!!
RRE3740 The new royalties are excessive. Stick with current system.
RRE3741 Stop giving away Alberta's resources at below fair market value. It's short changing the taxpayers and destroying the environment.
RRE3742 I believe it is time for Albertans to recieve their fair share of resource royalties. Especially in the oil sands, once initial costs are recovered there is no need to offer a reduced royalty on a resouce that the oil and gas companies would break their arms to develop in any event. YES I am all for the recommendations of the royalty review. PS. I work in the oil and gas sector for a major resouce producer.
RRE3743 I truly believe that if the Alberta govt engages the proposed Royalty increases , the oil industry will immediately shut down all conventional drilling projects. I currently [Information Removed]a small company that has already postponed their next well as they wait the Premiers decision in mid October. I feel that one of 2 items should or could be implimented: 1. Make no changes at all. or 2. Lower the proposed increases by 50% Regards[Information Removed]
RRE3744 I feel compelled to write you to express my concerns regarding the proposed royalty changes recommended by the Royalty Review panel. I have waited for several days before writing this in the hopes that my message would be more logical and less emotional, but it seems that with the passing of time my anger and frustration continues to grow. I have a few points and questions that I would like to share. If the Royalty Review panel's assumption is correct that the resource revenue pie would not change, what would the Government of Alberta do with an extra $2 Billion in royalties? We already have an incredibly strong economy, very low unemployment, and record government surpluses. Why is the government looking at taking such a huge sum of money away from (mostly publicly owned!) businesses that have a history of massive reinvestment of capital? As much as some people are reluctant to admit it, oil and gas is the backbone of Alberta's economy. The so-called threats that several oil companies have made regarding reducing capital investment in Alberta is just the reality of what higher royalties mean to the marketplace. Oil companies are in the business of making money, and will obviously only invest in economically advantageous environments. This is just common sense. I am very aware that most of the Albertan's who don't work in the oil and gas sector do not understand how the investment decisions are made, or how the royalties are calculated. They don't know about the risks, the costs, or the fact that oil companies have to replace 25% of their production a year just to fight decline rates. All they know is that these companies are making record profits, and that this Royalty Review says that the people of Alberta are being ripped off. I believe that the royalty regime has served Albertans very well. I'm sure there are changes and updates that should be made. Royalties need to evolve as the business environment changes. But to have a wholesale overhaul, based on out of date information no less, would seem to irresponsible and foolish. I have already seen some impact from the panel's recommendations. There is fear in the oil and gas industry right now. I'm not talking about the executives of Big Oil (although I'm sure they're losing sleep too), but among the thousands of employees who work for the oil and gas industry. These are people who have suddenly decided to wait to have their home renovations done, or buy that new car. I can't even imagine what all the people in smaller towns that rely on the oil sands for employment are feeling. The repercussions of the panel's royalty recommendations are far reaching - and should be very carefully considered before any changes are implemented. Alberta is the envy of Canada in many ways, it would be a tragic mistake to think that our economy can withstand whatever changes are thrown it's way.
RRE3745 I feel that if the province goes through with the new royalty plan that we as Albertans will suffer through massive job cuts due to the extra cost of exploration. [Information Removed]
RRE3746 I am an ordinary citizen, and not employed by an oil company, or a related industry or spin-off business, but I fear what will happen to Alberta if the royalty issue is pushed forward.
RRE3747 Alberta has enjoyed unprecedented prosperity over the last several years. Yet Stelmach states that the status quo is not an option. The simple fact that Alberta's boom may be put at risk with increased royalties leads me to withdraw my support for the Stelmach government. I will be looking for a party that shares my vision of a prosperous Alberta. The current government is beginning to look a lot like the Liberals.
RRE3748 From the City of [Information Removed] We must have a fair royalty system that is competitive with other North American jurisdictions. Intimidation by self-interest groups should not be a consideration when making this very important decision. It is important that all interests in our Province understand the need for a royalty system that can provide municipal infrastructure that supports energy development. Municipal Governments cannot support these services on a property tax revenue based system.
RRE3749 I support the findings and recommendations of the Royalty Review Panel.
RRE3750 Since oil resources are scarce, raising royalty rates by 20 per cent, or $2 billion a year will not hurt the province's investment and growth potential. If some big corporations won't step up to the plate and distributed some more of their revenues back to the province, other big corporations will. However, no big corporations will say no to a progressive rate hike, like a 10% raise for now and another 10% sometime in the future.
RRE3751 I'm an independent contractor involved in oilfield construction, I live in rural Alberta, I contribute almost 100'000 dollars yearly in both personal and business taxes. Me and my family live comfortably due to income gained through the oil patch, we are NOT millionaires like some of the Stelmach government seems to think, we (oilpatch workers) contribute heavily to our respective communities. T
RRE3752 The Royalty Structure suggested by the panel will significantly impact the cash flows of the industry I and a lot of other Albertans work in. This in turn will lead to less activity, less employment, less new jobs, some new people in our industry losing their jobs and possibly their homes, reduction in taxes paid to the Alberta government on a personal and corporate basis, reductions in the prices paid at land sales, etc. Please do not take all of the recommendations of "Our Fair Share" as equal. Although some of the recommendations may be valid for the oil sands sector, they most certainly are not well researched when it comes to the exploration of natural gas.
RRE3753 I just wanted to say that alot of people will defenently be affected by raising royalties. At this time our family has been directly affected even though you havn't officially announced your discision. At this time of year my husband is usually very busy but right now he hasn't even turned a wheel for two weeks. Our lives seem to be put on pause while everyone is waiting for your next move. Like they say, what you do to the top affects everyone underneath. A "small" pullback from an oil company can translate into a complete stoppage for the people in the field. A minor change in stats for you could possibly mean bankruptcy for us. Putting pressure on big oil in Alberta is already putting alot of pressure on the voters of Alberta. Sincerly, [Information Removed]
RRE3754 Think very carefully before changing the royalty on gas. Since I work in the oil and gas industry, my views could easily be dismissed as self serving, if I weren’t also an Alberta citizen. I’ve seen first hand the impact the current slow down in gas drilling is having on the service industry in rural AB. I have close friends who own well testing pressure trucks who haven’t had a single day of work since spring break-up. These people and many others like them are servicing large equipment mortgages on equipment that isn’t generating any revenue under the current economics. The employees they once had have now moved on to other jobs. To change the royalty regime now and put the remaining service companies out of business is foolish and does nothing positive for the provinces bottom line. The negative impacts of these changes will be hardest felt in the rural areas where most of work is conducted. I simply can’t understand why the premier would choose to punish his rural power base. The oil and gas industry is facing enough uncertainty from the federal government (carbon taxes and the income trust ruling), and macroeconomic implications of a slow down in the US economy. For the provincial government to introduce further uncertainty at this time is inexcusable, and will not be forgotten by the voters.
RRE3755 Dear Mr. Stelmach, I have read the royalty review report and I would like to express my thoughts. Firstly, I believe that some changes to the royalty structure in Alberta would be welcome. Secondly, I also believe strongly that the oil and gas (and Oil sands) insdustry are delicately balanced. A prime example is the rapid downturn in gas drilling and associated economic activity resulting from recent lower gas prices, which are not that low by historical standards. With this in mind there are a few exceptions that I hope you will address. Dont change the conventional gas royalty structure, gas is becominga global commodity with LNG technology which will stabilize gas prices at a level that, under the proposed changes would have most if not all gas wells paying higher royaltys. This will seriously curtail Natural Gas production growth and assiociated economic benefit to Alberta. Increase the oil sands royalty to 33% but only for new projects and existing projects in the future, dont change the deal that existing projects are built on. Changing the rules is not the way to promote confidence in building new project. Other than the 33% change, leave the rest alone. The oil and gas industry is the engine and base building block for Alberta's economy. If the royalty report is adopted as it stands I believe that oil and gas activity in Alberta will contract significantly and Alberta's economy will suffer, rather than propser. The current royalty environment has resulted in growth and prosperity for Alberta, everything is good and I'm not sure why we'd risk upsetting that with large changes that I'm positive we cannot predict the outcome of. Sincerely, [Information Removed]
RRE3756 I have seen many of the issuies and have a great concern on the proposal. By changing to the structure outlined, the PC leadership looks like they would be able to stall an Alberta Economy in 2 quick blows. Deep Gas Royality and Oil Sand punches. You better look at what is happening today. The oil and gas sector is already at levels of 2004 for activity. These changes, without proper and joint review with Government and Industry could mean a serious loss of jobs in all areas. Housing and hotels, small businesses in rural Alberta who look for the "Oil Traffic", fill their vehicles etc. will all suffer. Please stop and rethink your actions and consultations before you bring in these changes
RRE3757 Please consider personal tax cuts before ever considering increasing royalty payments. I firmly believe that if the Government goes through with increasing the Royalty payments we will have a serious negative impact on Albertan's.
RRE3758 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 08:16:10 DATE ENTERED {ts '2007-10-02 08:30:01'}
RRE3759 I am very concerned about some features of the proposed changes to our royalty regime. Most disturbing to me is the severance tax on oilsands revenue. The principal it sets of double taxation is one that, as a conservative, I find reprehensible. I am also concerned with the impact increasing royalty rates on natural gas at current prices will have on investment in the province. I do think royalty rates for the relative commodities (oil and natural gas) should be put on an equivalent basis based on their relative heat content. Finally, I think some research should be done based on the relative return of investing in Alberta rather than other jurisdictions. Investing in oilsands where operating costs plus capital may be $45/barrel is a much different propsition than investing in Saudi Arabia where those costs might be $10. Comparing government take based on gross revenues is not a very relevant measure, since much of those operating and capital costs are also spent on employees and service companies that pay taxes in the province. Oil companies do business in a global marketplace. It is imperative that when we do change our royalty regime that we consciously evaluate the impact these changes will have on attracting investment in our province.
RRE3760 If implemented as proposed a number of these recommendations could serve to materially reduce the overall benefits accruing to Albertans from the oil and gas industry.
RRE3761 YES! Increase those royalties by as much as is humanly possible!!! The oilsands are a finite resource, and their exploitation causes widespread environmental destruction. It will not last for much longer, and then what? Back to being a backwater province begging Ottawa for extra subsidies? Calgary as the welfare capital of Canada? Get the royalties and get them now! [Information Removed], Winnipeg
RRE3762 Since the announcement that royalties were going to be reviewed there has been a significant decrease in activity in the oil patch in general. I believe that announcement was poorly handled as is the release of the latest results. This can probably go back to the initial decision where incentives were granted to companies to invest in the oilsands. I'm not aware of a clear plan to change those incentives. The problem is the uncertainty that it creates for business. I think the change if they are going to be made need to be done in consultation with industry and business, rather than being dictated. 2 Billion a year sounds like a lot but in the larger picture is the province as a whole going to loose more than that by creating the uncertainty for investors and business by proceeding to increase royalties. Some change possibly should be made and if they are I think there needs to be long term planning involved and not just a short term money grab. There needs to be a rate structure that will be based on the life of the field or resevoir. Ralph took 1.5 billion and split it up to Albertans and I recieved $400.00. If you increase Royalties By 2 Billion a year, I know it's going to cost me significantly more than that for quite a few years in lost revenue. Is 2 billions a year worth [Expletive] with something that is working? There is the old saying that "If it's not broke, Don't fix it".
RRE3763 Dear Premier Stelmach, I sincerely hope you won't be intimidated by the oil companies in this matter.If we have the oil and are a reliable source, there is no reason that we shouldn't receive as much as the rest of the world in benefits. Our province needs a lot of help in our communities infrastructure at this time, and their is no reason the oil companies should be getting the excess, rather than our people, who are going to have to come up with hard earned money to pay for the improvements. Our retired residents are noticing very little difference in this Alberta boom, except costs are rising, and pensions are not.
RRE3764 What do you as a government do for freeholders from whom you collected $317,000,000 in taxes and now plan to double it. I have voted for the PC party for over 30 years but that will come to an immediate halt if you proceed with this increase. I think you should consider the over 50,000 freeholders in this province and the power of this number of votes in the next election. As far as raising the Royalty rates to the Oil Companies I think you should be able to come up with a fair and equitable solution to this.
RRE3765 I am concerned about some of the recommendations in the royalty review report. Alberta is riding high on oil and gas royalty revenues. I can certainly see that in a time of high prices for oil, we could skim more of the profits for Albertans. but we have to be careful not to kill or sicken the goose that lays the golden egg. The projected 2 billion in increased royalties will dwindle quickly if companies do not continue to invest in new projects. If companies cut back on investment, the lost spin off effects of those investments will mean a serious negative impact on the economy and more than offset the increased royalties. While conventional oil and gas production is steadily declining, the future is in unconventional areas such as the oil sands and enhanced oil recovery or coal bed methane etc. These are costly and require large upfront investments. A stable climate for investment and a decent rate of return must be in place for these unconventional areas that rely on new technologies. 1) I feel we need to grandfather past investments. To change the terms after companies have made multi-billion dollar investments in oil sands projects which may have not started production or have not yet recouped the capital investment yet is basically breaking the terms of a business agreement. Alberta is preceived as a stable and reliable place to invest. Changing the terms of existing projects is not the message we want to send. We do not want to be lumped in with Venezuela or Russia that way. 2) The proposed new severance tax sounds like a regressive tax that leads to double taxation. Some people are comparing it to the kind of approach that we last saw with the disasterous NEP, which was the worst thing to happen to Alberta's economy in the last 50 years. 3) We are reviewing this in a time of record high prices for oil. However, those prices are increasing set on the futures market and heavily propped up by political elements of uncertainty such as the Iraq war, events in Nigeria, Iran's nuclear posturing etc. Prices cannot be propped up by these risk factors forever. Eventually there will be adjustments in the market and prices will fall again. We cannot assume that oil prices will remain at these levels. There are major resources of oil set to come on stream in the medium term in other parts of the world (such as the Caspian Sea). Eventually more supply from other areas of the world will come on stream, often at lower costs than those in Alberta. We need a royalty system that allows Alberta to sustain its economic prosperity, and we need to save and invest revenues in diversification during peak times so that we are not so affected by lower prices in the future.
RRE3766 It's about time we make sure we're getting our fair share. Don't back down to the postering of the oil companies (what did we expect them to do, nothing?).
RRE3767 I strongly recommend you follow the recommendations of the review. Quit wasting time and make a decision.
RRE3768 I think the government needs to really think through their discussion regarding royalties as the impact may slow down the Alberta economy. Perhaps some changes are needed but we must be careful not to impact our economy in a negative manner.
RRE3769 Royalty is only one of the many factors to deternine the economics of the project in oil and gas industry. The return of investment from Alberta oil ang gas project is not the highest in the world because our resources are either mature and/or expensive to exploit. Companies are investing in Alberta because of stable political environment and because of Canadian ability to innovate in technology. If the cost to invest in Alberta keeps rising like it is right now, the investment projects in Alberta become unattractive. Companies would go else for higher risk but higher return projects. If it is the case, there will be lower investment in capital money and technology here. I am a petroleum engineer and I know how hard it is nowadays to drill a new well. Costs have increased substantially while the oil/gas asset are getting more and more mature. Therefore, the project economics is so maginal to get the approval to spend the money. If the cost (including royalty) rise even more, then my company won't be able to invest in Alberta anymore. That means, my department will be shut down and I will be out of work soon. Please meet with the industry representatives before you make any decision on the royalty change to fully understand the consequences of what you are planning to do. Thank you.
RRE3770 Proposed powerline to south(altalink) on taxpayer's expense to ship power from Alberta to USA,Why? -I am paying 11 cent/kw way higher than other provinces and two times the price industrial users pay in ALberta.Why?
RRE3771 Western Canada is one of the highest cost petroleum regions in the world. Alberta's key attribute in attracting investment has been its stable political and fiscal regimes. The absence of grandfathering in the Royalty Review Panel's recommendations is a huge mistake in that it erodes Alberta's fiscal credibility. If royalty rules for existing wells are seen as being susceptible to change due to political pressure then the province will lose petroleum investment to other jurisdictions like B.C., the USA and other countries. It is budget planning time for 2008 activity in the petroleum industry and already companies are contemplating massive switches in investment capital from Alberta to other areas. Please don't let this happen to the Alberta economy and let's show that Alberta can be counted on to honour the deals it enters into.
RRE3772 Dont do it.
RRE3773 I think that the Alberta government should be taking more money from the oil companies.
RRE3774 As both an Albertan and an employee for a major oil company I have a vested interest in this question on both sides. My take on the question is that we should continue with the royalty change on the Oil Sands but not touch the conventional gas. The margins in this area are very tight and to further tax the companies at this end will increase the depth of the downturn in drilling. Thnak You
RRE3775 The oilsands area can use some cooling off and a higher royalty would provide a bit more discipline to that overheated envrionment. The new royalty will slow those develpments down a bit which will be good for the whole province; from both a revenue perspective and a reduction in cost perspective. I am confused about the changes to the gas royalties. I don't understnad why you would kick that indusrty when it is already down. Tie the royalty to the gas price so if it runs we'll get our share but I agree with industry, proceed cautiously that sector is pretty sensitive these days.
RRE3776 To the Government of Alberta, After taking the time to read the royalty review report, I feel that I should provide feedback. I am open to changes in the royalty system, but I feel that there are inconsistencies in the report that large enough to question some of the conclusions. An example is that early in the report it is stated that marginally economic projects should not necessarily be undertaken because they are a good deal, and it also states that a slowdown in the oil sands sector will result if the recommendations are implemented. However, in the projections of royalties collected in 2010 and 2016, the report assumes that production will be the same whether the changes are implemented or not. How can you remove some marginally economic projects, and slow down oil sands development, while maintaining the same production levels? I would encourage the government to consider this and any inconsistencies as they are reviewing the report, and to make a decision based on good governance rather than popular opinion. Thank you for your willingness to listen during this difficult decision. [Information Removed]
RRE3777 I work at an oil and gas company in the Cold Lake / Bonnyville area and have concerns over the royalty recommendations. I am concerned that the 20% increase is not accurate as stated by many industry experts and that the increase may be as much as 50%. I am also concerned that very little consultation was done with the many stakeholders that will be affected by any changes. I believe that increases in royalty should only be tied to higher commodity prices to encourage a substainable business climate and still flow cash into public coffers. I hope that the government will act responsibly by acting on the facts and not opinion polls so that all Albertans get the opportunity to reap the benefits of this industry. Sincerely, [Information Removed]
RRE3778 Even if the Royalty Review suggestions were implemented, Alberta would be collecting the LOWEST royalties in the world (especially given how other places have increased royalties since the review data). Don't give away the farm! Please implement the suggestions to the fullest extent possible! [Information Removed]
RRE3779 As a lifelong Albertan, it is high time that the the citizens of province get more of the wealth. These resources belong to US in the first place. Not the international oil conglomerates. The fact that is simply two billion dollars more is nothing more than chump change to these companies. The fact that they are trying to bully Albertans out of their own money is something that is disgusting and they should be more than ashamed of themselves. Personally I would reccomend more than 2 billion dollars. However it is a start. I would encourage this government to move forward with this decision. This government has been on the wrong side of all issues since the premier took over last year. This would be the first decision that is had made that would be the write one. I STRONGLY urge the government to follow through on the recommendations of the report. Thank You
RRE3780 Dear Premier Stelmach; I have been a Conservative all of my life and believe in what the party stands for. A healthy economy generates our tax base. Alberta with our resources and resourceful people are the reasons our Canadian dollar is worth a US dollar today. A strong dollar is not good for oil companies but great for the people of Alberta. [Information Removed], a large energy service and construction company. We have approximately 10,000 employees active in this sector and around 75% of our business is in Alberta. The natural gas business is already in trouble in Alberta with gas prices being soft and producers only using 360 of the 865 rigs in western Canada. Oilsands development has been the bright spot but to compete on a world stage we need to keep things stable and encourage the producers to develop this expensive resource. How would you feel if you invested billions of dollars then found out the rules are changing? I am strongly opposed to any increase in royalties. When producers spend money in our province it recycles many times through retail, real estate, restaurants and income taxes. Don't kill the goose that lays the golden eggs. The government does not need the additional revenues; we the citizens need the jobs. If we go with the royalty increases I fear thousands of jobs would be lost in [Information Removed] alone. Our shareholders would lose out as well. Stocks are already falling due to the report. To this point the conservative government has served us very well with the services needed in our communities. [Information Removed] and we see the prosperity keeping us busy developing Alberta's work force. Keep that Alberta Advantage. The contemplated royalty change promises to kill our economy. Not just Alberta but all of Canada. Other countries including the USA are keen to take our market share to supply North American demand. [Information Removed]
RRE3781 You people are out of your minds. Your going to ruin alot of lives!!!
RRE3782 This letter is in response to the recently released royalty review report submitted to your government. I strongly urge you not to accept the recommendations outlined in the report. I do not feel that the report adequately addressed the issues associated with crown land auction revenue collected by the government of Alberta. I quote from a press release available on the Alberta Energy website: “Crown Land auction revenue surpasses $2 billion in fiscal 2006-07” (March 30, 2007) The Department of Energy collected $2.4 billion in land sale bonuses from oil sands and petroleum and natural gas (P&NG) rights in fiscal 2006-2007. The only other year when bonuses exceeded $2 billion was 2005-2006, when the department collected $3.4 billion.” Source: http://www.energy.gov.ab.ca/Tenure/882.asp With the current downturn in drilling activity in the conventional oil and gas sector I feel that the time is right to lower the royalty on marginal oil and gas wells associated with infill drilling and shallow gas drilling. This will foster increased activity and create jobs. It will also increase the total royalty collected by increasing the amount of oil and gas produced in Alberta. Sincerely, [Information Removed]
RRE3783 Dear Premier Stelmach, I am a native Albertan who has built a small business supporting computer networks in Calgary. More than 80% of my income is directly related to people and corporations that work in or with the oil sector. I am seriously concerned about raising royalty payments. I somewhat understand the need to improve the provincial infrastructure. With the growth over the past few years, there are a lot more people to serve from the government's viewpoint. I use many services daily, such as the roads, schools, etc. and have no major complaints. If you proceed with increasing royalties, the short term financial gain to the government's budget will mean significant pain to the regular Albertan like myself. How will I support my family in Alberta if my income decreases by 50%? My small business in Alberta employs young technical workers. Any cut backs I have to make would immediately affect them. It may seem like an easy cash grab to some (and a way to reduce dependency on Oil & Gas business) but the resulting collapse will affect small business in a huge way. The big oil companies that you are possibly trying to target will just lay off their local staff and take their money elsewhere. I agree that additional dollars should be retained for Albertans and their future. There is nothing more in this world that I want then a bright future for my three daughters. Penalizing the oil industry today will drastically limit the quality of life I can give them and the options they have when they leave school. The money I get is taxed at the energy company level, is taxed at my company, is taxed as income when I get it, and pays many taxes, levies and user fees when it leaves my hands. With the Province running a surplus why would you risk all these other revenue streams to get an additional cut of royalties? What would the value of the tax loss be if the oil companies quit spending their money on capital projects? This number should be determined before proceeding. It goes without saying that a halt on capital project spending would have a massive effect on the people of Alberta. The characterization that these profits go to a few rich people to make them richer is misleading. Some of these oil and gas company shares I own, to save for my retirement. Higher taxes and royalties means not only do I earn less, but the money that I have saved for my retirement is depleted as well. I implore you to review the scope of this report and take a different path at this time. It may seem great to build a few roads or schools during your term but your legacy will be the death of thousands of small businesses like mine. Sincerely, [Information Removed] Calgary, AB
RRE3784 am worried that your government is more interested in playing politics and improving Ed Stelmach’s ratings than honestly doing what is in Alberta's long term best interests. It’s a great political move to take on those “fat cat oil companies" as the average Albertan, unfortunately, has little understanding of how the oil industry works, but is happy to express resentment or jealousy of the incomes earned by management. Do they even know that most oil profits are reinvested in the ground? Notwithstanding my skepticism of the process I submit some comments and ideas: · If not for the Alberta advantage, which attracted the oil investment in the first place, this province would be part of Canada's have-not provinces;Some companies have already indicated that they will move their investment dollars to Saskachewan where the environment is presently more attractive · If not for the courage and initiatives and entrepreneurial skills of investors, employees in the oil business and management, our resources would be merely assets still in the ground; · Government is not prepared to expose itself to the investment risk so it is left to the oil companies to do the "dirty work". I believe that the average Albertan and many in government have no concept of what this means. · When your predecessor had the opportunity years back to support the building of upgrades, which would have been risky and cost many billions then, but would have been paid off by now and generated billions of extra dollars to our province, he did not have the vision or courage to proceed. Imagine the billions that have been lost because of this. Fortunately it is still not too late although costs have risen exponentially since then, it still makes sense to go this way. · The Royalty review panel recommendation of a 5% credit does not go far enough. We need government to step up to the plate and make this a meaningful credit and also build or guarantee the funds so that upgraders WILL be built. Our future is in the oilsands and for us to "be hewers of wood" and sell our bitumen at discount prices to others who have little risk and just process our oil, borders on the criminally negligent; · Oil companies are financed in large part by investors, many of whom are Albertans, and so many of the benefits the company earns are passed on to these Albertans in the form of dividends and capital appreciation, which are passed back in part in taxes. Therefore, whilst your panel may see a tax/royalty leakage directly from the oil companies, the government and the rest of Alberta is still receiving their "fair share " in taxes. · I would assume that many Albertans have RSP accounts and the majority would have mutual funds in which the energy sector would be a constituent, such as well known names like Encana, Canadian Natural etc. Here again, Albertans have a direct stake in the oil industry and benefit here when the companies are successful. Preparing for retirement with sufficient funds, which in part is achieved through Again No consideration from the panel on this · In many cases, some of the "oil companies" as well the companies that provide services related thereto are small Alberta operations owned and run by Albertans . All these business people have taken huge risks to get to where they are today. . The implications of the proposals will be so punitive for these companies that some may be forced out of business or will have to shut in marginal wells, or reduce the scope of their operations.Already the drilling and service industry has purportedly laid off 10,000 workers and with rig utilization rates at less than 50%, more royalties/ taxes are just another nail in the coffin. While the larger firms can reallocate to other regions etc , the small Alberta operations are stuck. · The blow to our junior industry from the low gas prices and income trust debacle all have added to the difficulty in raising investment money for these companies and these issues cannot be understated. · No differentiation or investigation was made by the panel between foreign and local ownership. I believe this was a paramount mistake. As an Albertan, I believe there is a large difference in knowing whether the profits are leaving the province or staying. · An idea would be to retain the royalty rate at 20% after payout provided the net profits are reinvested in Alberta. If the funds are sent out to foreign investors or foreign head offices, then there should be a progressive tax charge moving up to the proposed 33%. Again, what the panel and the average Albertan seem to ignore is that the majority of profits generated by the oil companies are further reinvested here, unless the economic environment is not favourable. It is a fallacy that investment will continue to flow into Alberta just because we have " a stable government". Another important characteristic of a stable government is reliability. The stable government theory and huge oilsands reserves have to be compared with other environments that provide cheaper labour, more hospitable terrain, better weather conditions, etc, and as such it is not automatic that investment will simply flow here. · Over time, even a small loss in new investment will negate any additional funds from new royalties/taxes. · I suggest that there should be a correlation between the Canadian Dollar/ USA dollar and a formula for calculating an average netback. At the point when this netback reaches a threshold equating to a super profit (or certain return on equity), an additional royalty should be charged. However, this Royalty tax should not be used for general purposes but should be specifically designated for the Heritage Fund. · The proposed removal of existing agreements is as thoughtless as it is illegal. It will be a costly legal endeavour that will be costly to the tax payers. A part of this issue pertains to the proposed ramping up of leases based on development timelines. Their proposal to reduce it from 20 years to 6 years in the oilsands offers an additional reason to doubt the credibility of the panel. Not only was the government paid billions of dollars for their leases based on stipulated timelines, but a decision to shorten this timeline - taking into consideration the shortage of labour and resources and huge construction costs that are already straining the industry, will create severe difficulties (whether or not the term changes are or legal). · Another point missed by the panel was that of not including the revenue brought in by the government for the oil leases , which are amongst the highest in the world . If these numbers are included with the royalties, Albertans are getting a pretty fair deal. Funds generated by the government from our oil leases compared to other jurisdictions is incredibly lucrative, and I believe that it is naive to assume that this free money windfall will continue unabated when more is taken by government on the other end. In conclusion, my skepticism aside ,I am still hopeful that common sense and not bluster will prevail. However my view of the process is summarized below: I think the choice of a panel with no real industry/business experts was very deliberate so that they would come out with the worst possible outcome for the oil industry. This will score points with the voting public. Ed Stelmach will ride in – un-bullied – to choose from the list of suggestions, thus showing Albertans that he is the boss and that the oil industry does not control him, and in this way he will score more points with voters. And, the oil industry sees the choices Ed Stelmach makes as reasonable and although it has only slightly bloodied its nose, it has not been laid unconscious with broken bones. In this way, Stelmach scores points with the voting oil industry and continueso receive financing for the Conserative party. And all are happy for a while!!!!!!!!!!!!!!!
RRE3785 We are not getting our share, is that very simple. Now get to work and do something. Enough of the talk and shavling papers. The recommendation of the panel and the Auditor General should be fully implemented. The responsible individuals should be held accountable not just moved around, changed portfolios, and awaiting for picefull retirement. There is no accountibility to the public at higer level just talk. I'm certain, I'll think for which party I vote if recommendation not implemented. Thanks.
RRE3786 Hello, I have been following this issue well before it became a more public issue within the PC leadership election. I am also rather ashamed of the PC government under Klein; how he did not allow for much discussion and objective review of the royalty arrangement under his leadership. I think the panel’s recommendations are weak in the context of the current realities of the international energy market and the energy industry’s own numbers and projections. Thus, the Panel's recommendations are still too low. Ultimately, I would love to see all the people of Alberta benefit from our natural asset by capturing 100% of the resource revenue. At minimum, the provincial government should adopt the Parkland Institute's key recommendations. These include: - that the 1% royalty holiday be eliminated; - that the base royalty rate should be increased to the point where Alberta is capturing at least 90% of available economic rent; - that a windfall profits tax be implemented with the goal of capturing close to 100% of any significant increase in energy prices; - that instead of the proposed royalty credit for companies that upgrade in Alberta, which would cost Albertans $3.2 billion, the government ensure value-added processing through strong regulations; and - that, in recognition of the fact that 80% of global oil is controlled by National Oil Companies, Alberta seriously study public ownership as a way of maximizing revenues and playing a leadership role in the energy industry. Big Oil companies are threatening Albertans by holding their jobs hostage. Alberta does not tolerate that. The provincial government should defend all Albertans by firmly setting the terms to Big Oil and adopting these recommendations listed that are common in other regions of the world. [Information Removed]
RRE3787 I am a small investor and have been focused on the resource sector.i recently read that the oil and gas sector in Alberta was in distress due to the gas price and royalty trust fall out and that only some 15 % of drill rigs were at work ,with the services industry really suffering.A man from Grand Prairie said his house price had dropped $40k since Aug due to the deteriorating economic situation.Thus I cannot see any sense in shooting the oil sands, particularly the future of your economy.Present large companies will have to pay up but the small ones ie the future will be deterred.The feds killed the O&G royalty trusts ( on which my wife and lost 30%) and now you want to kill the rest of the Alberta O & G Goose.Why your government let this study even surface is an act of incompetence in itself! I do know the O % G industry is not like hockey where every few years you can make rule changes and expect the game to go on.Planning is based on the present value of future cash flows.In a margin business,commodity and cost of capital variations present enough of a planning challenge.If one adds Chavez and Russian like uncertainty then its goodbye, money will head south like your drill rigs.You are in the process of destroying the credibility of the Alberta O & G government as a favourable place to do business,your economy.and the reputation of Canada as whole.Because you want to grab more when industry took the risks,just like Chavez ,Russia and others.Shame.
RRE3788 As a worker in the oil patch my life and my familys life depends on 6 guys who have not even worked in the patch and think they have the right to demand the change to oil companies as it would put me out of work and my family Where do we go from here unemployment that does not pay the bills or welfare, i am a man and i can support my family what can i do no where to go i see 6 guys who does not even work in the oil patch or even has been there. If you were a investor in Alberta and making a decent return on the money you invested and then a huge change and not enough money on the return who will invest in Alberta . I think people need to stir [expletive] in the little peoples life to upset us so the little guy does not get ahead.
RRE3789 I believe Alberta and any jurisdiction should receive its fair share of revenues from non renewable resource, but I believe the royalty review if implemented will have the exact opposite outcome. The report does not adequately take into account, competitiveness and return on investment, rather the report unwisely focuses on direct comparisons of royalty takes between varying jurisdictions. These are not relevant on their own since they do not take into account the productivity of those resources or the cost to produce them. We will see small producers who fund exploration out of cash flow further restrict expenditure and the large Canadian and Multinationals firms will shift resources to other Canadian jurisdictions such as BC and Sask. or worse to US resource plays or other international opportunities. Currently exploration in the [Information Removed] is depressed while activity in the US only recently has shown signs of moderating due to depressed natural gas prices. If the Alberta royalty structure was lax and overly generous in comparison to US jurisdictions one would have expected comparable levels of activity in 2007. Unfortunately the reserves in the Western Canada Sedimentary Basin are some of the highest cost reserves to develop. As a result one would expect correspondingly low royalty rates. With layoffs and transfers out of Canada already occurring in the oil field service industry now is not the time for a revenue grab, the impact of good jobs in the oilfield service industry in Alberta far out weighs any illusory revenues from royalties based on the assumption that a reduction in cash flow will have no effect on investment in capital. These are good jobs for ordinary voters outside or Calgary and Edmonton who are already being impacted. I would ask that you reject the Alberta Royalty Review Panel report and implement a plan which will encourage conventional exploration and which restore the Alberta Advantage. Regards [Information Removed]Calgary Ab
RRE3790 Dear Sirs. Clearly our Alberta Government have forgotten what the economy was like in the mid and late 80's. Let me remind you how many people were effected by the Alberta oil and gas slow down. Loss of jobs , loss of homes for employees . work sharing to try and keep employees from living on the streets.This isn't fiction, this was the reality at [Information Removed], our family business. We went from over 850 employees at our west end branch to less that 250 people in one year. It took 10 years to recover. We were not the only company to see this. All companies are effected. All companies regardless if they are related to the oil sector or not will be see devistating drop in business, This will include Government staff as well. You can look back at the number of Government jobs that were lost then and decide if that's the direction you want to take. I know I don't want to see this and neither should you. You may think you are doing Alberta a great servious by attacking the Oil Companies . You are not. You forget that all the oil companies are international. As such , they can spend research money in any country they want. Alberta is only one in many. Oil companies go to the areas that they can work with the local governments and make a return on investment. If not here , then somewhere else. Don't kid yourself. Ask not what the oil companies can do for you , Ask what you can do for the oil companies. Smile when you do it and hope they continue to spend here in Alberta. Your own jobs may count on it.
RRE3791 The report is fair and we just want our government to implement it as soon as possible. The longer we wait, the more valuable our resources
RRE3792 I WISH TO ELABORATE ON MY EARLIER COMMENTS RE ROYALTY RATES. FIRST RECOVERY OF OIL SANDS COSTS PRINCIPLE SHOULD PREVAIL BUT EARLY IMEDIATE TWEAKING COULD TAKE PLACE NOW WITH INCREASE TAKE BY ALBERTA AS PICE INCREASES. FOR NATURAL GAS ABSALUTY NO IMEDIATE INCREASE BUT ABENCH MARK PRICE SET FOR INCREASE. AS FOR CONVENTIONAL OIL NO IN CREASE UNTIL PRICE INCREASES BEYOND SAY 75 DOLLARS ON AVERAGE OVER 6MONTH PERIOD. YT [Information Removed]
RRE3793 We do not need another nep, people are allready having problems with not much work going on in the drilling and service sectors. With billions in surplus every year you just need to spend carefully. Do not let our province go back into debt. The average albertan has never got back anything from our sweat, hard times, & tears to help get our province out of debt. Have any of you government people lost your home & lively hood when raising your family, it's not nice. With koyto & more royalties oil companies could very well shut down again. Hope fully we are smart enough to prevent this, working people have more value to the province paying taxs than sitting home losing everything again.
RRE3794 The oil industry as a whole is suffering for the last few years. We live in Grande Prairie and most people you talk to have worked around 28-33 days since May of this year!! There are foreclosures on homes and people are losing their vehicles because they can't make payments. To increase the oil companies fees will affect the worker, not the oil company. The oil companies will hold off on exploring and producing on new wells and lay off more people. This will depress our economy even more. If the government needs more money from the oil industry, and I am not sure why they do when it is my understanding Alberta is operating at a surplus, I would like to strongly urge them to table this proposal until the industry is back strong. Even a few more years would increase production and bring back all the people laid off this year. At that time, it may not be as devastating a blow when the oil companies put everything on hold. People will have worked more and have money saved to ride it out, as we have had to this year. Please do not raise the royalty paid by oil companies. Our economy can not take it!!! Thank you, [Information Removed]Grande Prairie
RRE3795 Albertan's deserve to get a much larger portion of the revenues created from selling our oil and gas resources as these are nonrenewable resources with hugh environmental impacts of their extraction. Please impose the recommendations set out by the "Independent Panel" suggesting an increase in royalities. Our children's future depends upon it!
RRE3796 If the money goes to the goverment it will simply fund their crazy spending on teachers, health care workers, and other people at the political trough. I think is crazy and if they can't see the slow down in oil and gas they are nuts.
RRE3797 Understanding that Alberta is so heavily reliant on the production of oil and gas and seemingly is the economic engine of Canada I cannot help but be stunned at the lack of intuitiveness regarding this report. I view the consequences of this implementation to be disasterous to our Alberta, and potentially national economy. Reading the CAPP reports and reports by business I've already personally decided to become more liquid and shift my significant investments out of Alberta pending the implementation of the recommendations from this report. Understanding that this might be a knee-jerk reaction, I, like many Albertans I would suspect, do not want to re-live the 80's & early 90's. I do believe that Albertans understand the significant investment that has been made into our economy by the energy sector and the resulting support companies that are needed; the influx of Canadians and foreigners alike to Alberta speaks volumes to our hot economy - our debt is paid, we are realizing a significant surplus and our services are receiving a surge of funding. While we are experiencing typical growing pains of such tremendous growth, you do not have to look too far outside of Alberta's borders to see just how prosperous we are. I emplore the government(s) to regard just how damaging this could be to its constituents - you are in power to help not hinder.
RRE3798 As an Engineering Manager working in the oil patch for the last 23 years, I have seen many ups and downs in oil patch activity for various reasons. Currently, the oil patch is in one the downs due to low natural gas prices, the high cost of materials/services and the strength of the Canadian dollar in spite of high oil prices. If the C$ and high costs are taken into consideration, high oil prices are required in order make a reasonable return on investment. I urge the Premier to very cautious when considering what the effects of a significant increase in Royalty rates will have on an already stagnant oil patch in Alberta. Yes, our Royalty rates may be lower than others, but a significant increase in rates will remove investment dollars from Alberta, and thus out of Albertans pockets, I believe that the majority of the money earned by oil companies operating in Alberta is reinvested in Alberta projects, thus benefitting all Albertans. If Alberta loses major projects, there will many job losses and as a result, a reduction in the average Albertan's standard of living. [Information Removed]
RRE3799 Increase the rates - after all, the resource is Alberta's. By Alberta, that means Albertans - the people. Not the government and definitely not Encana and all the rest. The provincial government should be ashamed of the way they have handled our resources. What happened to our history and character of sticking up for what's right? It's long gone - as soon as the "Alberta Advantage" knocked on the door.
RRE3800 I guess this is good news for Saskatchewan. I think something should probably be done on royalites but I think it requires a bit more up front work to make a smarter decision.
RRE3801 I work as a petroleum landman in Calgary, but I want to table these comments as an Alberta citizen along with being an oil & gas professional. I am frankly concerned with the potential ramifications to the provincial economy, the potential effects on energy industry activity, the liveihoods of my fellow citizens and my own liveihood. The Royalty Review Panel has demonstrated in their report that they simply do not understand the current environment of the oil & gas industry is in with respect to Western Canada. This is not the 1950's, 1960's, 1970's, 1980's or 1990's. The industry is chasing smaller hydrocarbon pools in a higher cost environment. Did the Committee bother to understand the industry finding & development costs over the last 5 to 10 years? Did they bother to understand the average size of pools found over the last 5 to 10 years in Alberta? Did they not bother to see what economic activity has been created in the Province by capital spending from the oil & gas industry? Did they bother to understand what taxes have been paid by industry, or what provincial income taxes have been generated by well-paying industry jobs? Did they bother to understand how many dollars that the Province has reaped from P&NG rights sales over the last 5 to 10 years? If the Panel has not fully understood these issues, then I hope the government at the very least takes the time to assess the potential risk to all of things and more when they make their decision. Simply, the economy, the energy industry and jobs are all on the line with this decision. If the government does not believe me, than God help us all !!! In respect of one specific issue that I have not seen in all of the reporting and debates regarding the Royalty Review Report, I would like to draw such issue to your attention. When the Review Panel examined other state/Crown royalty regimes in North America, did they fully understand the percentage of government-owned P&NG rights versus freehold ownership? I can tell you that the percentage of freehold ownership is probably a lot higher in comparison to government-owned P&NG rights in almost all of these other North American jurisdictions as compared to Alberta (with British Columbia probably being the major exception). What my point is then is that state/Crown royalties may be higher in these other jurisdications, but the overall effect to industry in these jurisdications is that companies' effective average royalty costs are blended downward as compared to the average royalty costs of their Alberta counterparts because the typically lower freehold royalty costs (involving a higher percentage of land holdings as compared to government lands) are blended with the government royalty costs (involving a much lower percentage of land holdings as compared to freehold lands) to bring such companies' average royalty costs downward. I believe Alberta contains over 80% of Crown P&NG rights as compared to freehold ownership. Therefore, the effect of higher Crown/state royalties has a larger impact on the bottomline for companies operating in Alberta as compared to most other jurisdications, with the probable exception of British Columbia. Related to this issue, is the Royalty Review Panel also suggesting that the pool sizes and the cost environment of each of the stated jurisdications are the same as Alberta? If that is the suggestion, then their point is comparing apples to oranges because the Committee simply has failed to take into account the different risk profiles and rate of return profiles for each of the jurisdictions stated in the Report. I hope the government takes the time to try to understand my points above. Please get this issue right. Our provincial economy, our citizens' livelihoods and my livelihood is truly on the line!!!!!! [Information Removed], Calgary
RRE3802 Please stay the course. Slowing things down at this time is not necessarily a bad idea. Our resources are not renewable and this will ensure that the benefits from having them will continue for longer (if the oil companies do slow down) and the overall return to Albertans should be more. Regarding the threats to pull out, cut back etc. , one only has to look at other areas to understand that the changes proposed for Alberta are not out of line. Take Alaska for example.
RRE3803 Instead of worrying about this review, we should have the panel investigate the conduct and spending of each MLA. For example, certain MLA's, when going on meetings abroad (ie: outside Canada), they bring their entire family and friends. While for meetings to nearby areas (ie: Edmonton, Calgary), we rarely see them. It seems to me that the MLA's are more interested in viewing an area's scenery than discussing how to improve policy. I think if these misbehaviours are addressed, it would regain Albertan's confidence in government more than the royalty review.
RRE3804 I object to the proposed changes to the royalty regime recommended in the Alberta Royalty Review document. Please ensure this message is passed on to the Honorable Ed Stelmach and the rest of our government. Regards, [Information Removed]
RRE3805 i believe that this reveiw was destined to failure from the start. It should not have been commissioned. The Alberta economy is oil and gas driven. The world price of oil may be high but Alberta is primarily a gas producing province at this time. The world price of gas is low and we have an over supply of it. Many small producers cash flows will be inhibited with the new recommendations. Some of these companies are having problems raising capital to survive. With this change their lines of credit will be reduced and they may not survive. The small service companies, rural motels, restaurants, parts suppliers, will all have problems existing as the oil companies reduce their spending. It is more than the oil companies that will be effected, it will be all of Alberta. What happened to our Alberta Advantage. In the report they compared us to other oil producing areas what about BC and Sask that are hungry to have the oil and gas revenue. This is a mistake and I hope that the Stelmach government ignores this report and admits it made a mistake commissioning this report. With the reduced spending by the oil companies and with the service companies having no work there will be a reduction in income to the government that may add up to more than the $2B they think they will increase. It is like the income trust changes in the long run it will not create more wealth for the governments but will drastically affect the wage earner negatively. You still have time to correct this do not follow through on the recommendations for the good of Albertans. [Information Removed]
RRE3806 the recommencations of the Royalty Review Panel should be adopted. If you don't use the recommendations why have the review panel?
RRE3807 I am a Recruiter on contract with a large O & G company. I have been told if the recommendations go through I will lose my job. These recommendations will not only affect me and my family. They will affect most of all Albertans....negatively!
RRE3808 Dear Mr. Premier, I strongly urge you implement the recommendations from the Royalty Review Panel's report as quickly as possible. Albertans having been losing out on potential revenue that could have been used to address the infrastructure issues we have been experiencing during the recent boom, or be placed in the Heritage fund in order to prepare for any fluctuations or downturns in the oil industry. I know that there has been a great deal of controversy around the report, but taking a stand on this issue on behalf of Albertans would show that your government cares about the interests of its citizens. Sincerely, [Information Removed]
RRE3809 In my opinion if this goes through the initial loss of jobs is going to be huge but soon after the loss of businesses, the provinces share of personal income tax revenue will drop dramatically and in essense, the province will be in trouble. If this proposal goes through it will just show that the provincial government is not working for Albertans and that our "voice" isn't really ours.
RRE3810 Premier Stelmach . . . our prayers are with you to stand up to the intense pressure and threats that you are receiving from Big Oil. Remember your boss is the people and the people oun the resource. We want our fair share.
RRE3811 While I think it is a good idea to get maximum value for the people of Alberta, increasing royalties over 50% in some cases is too much. Alberta is a maturing basin, with not very much hydrocarbon left to extract. I am deeply concerned that the oil compaines are threatening to pull out billions in investments. From what I gather, there will be massive layoffs if the increased royaly goes through. It won't affect the top executives that much, but it will affect the turck driver who lives down the street when he loses work. Then Alberta will be losing money, not getting more royalties.
RRE3812 The cost of transporting natural gas to eastern Canada and export markets is very high (eg $1.50/GJ) relative to the commodity price of gas (unlike crude oil). Becasuse Alberta's gas industry is $1.50 per GJ disadvantaged due to distance, it is reasonable and fair that, to have vibrant gas industry, our royalty rates should be on the lower side when compared to other jurisdictions. As you know the 'gas' industry does the most drilling, and employs much more people than does conventional oil, so this is a very important consideration. I believe the gas industry can only absorb higher royalty rates when commodity prices are higher than today. As such, it is extremely important that the propsosed thresholds for sliding scales be adjusted to only increase natural gas royalties when prices are much higher than the current level. [Information Removed]
RRE3813 I beleive when the projects that are now under construction in alberta become operational combined with the ones already producing and the royaltys from this is more than enough. I have lived and worked in Fort McMurray for the past 32 years and i have seen the growth that has taken place the last 5 years alone and the prices paid for housing by the next generation of Albertans is taxing enough and then putting added pressure on the oil & gas sector which i hope would not force them to shelve their projects thus leaving the young adults in our province in a mess while trying to pay without jobs. I say enough is enough and lets carry on with what we have and focus more on how we waste our dollars. Thank you, [Information Removed]
RRE3814 Hold the fort Mr Premier. You must implement the recommendations of the report. If that causes a slowdown in exploitation of the tar sands, so much the better. Remember your own metaphor; just like loading up the top soil on your farm and hauling it all away (down south).
RRE3815 I listen to the oil company execs. and spin doctors whining and threatening offerings and it makes me want to vomit. These companies continue to gouge us at the pumps with no concsience at whatsoever! They expect to maintain the status quo at the public's expense. ($10.00 a barrel at the signing, now $82.00!.) How stupid do they think we are? Sock it to them!!
RRE3816 Mr. Stelmach, Please think of the long term future of this province and accept all of the royalty review's recommendations. Areas like Fort MacMurray have been asking for a slower pace for some time now. This may help provide it. Furthermore, jobs have been decreasing in the oil patch for some time already, not because of the royalty review, but because everyone and their dog jumped on the bandwagon and went into the oil industry over the past two years - abandoning other required jobs for the hope of a quick buck. Ralph Klein's government let this happen and I emplore you to fix it before this province becomes a wasteland. Sincerely, [Information Removed]
RRE3817 I will work in the alberta oil patch and i feel that by pushing the royalties issue jepordazies my job and the jobs of my fellow oil patch workers.I can not attend tommorows rally but i do support my fellow workers.I think that pushing the royalties to prove that your the big man is bull [Expletive] and that we should not have to suffer for your ego.I voted P.C not N.D.P or Liberal, its time you dont forget the people that vote for you.
RRE3818 Adoption of the Royalty Review Panels recommendations in current form will have a devastating impact on Alberta's economy. There will less activity in the oil patch, mass lay-offs and ultimately lower royalty payments to the government. Great care needs to be taken to ensure the Alberta Government does not make a decision that will kill the goose that layed the golden egg!
RRE3819 I believe this review in the long run will have a negative effect on Albertans , as the wife of a oilfeild worker the government has their hands in our pockets and will create job loss, it all has a domino effect , don't kid yourselves....
RRE3820 With the downturn of drilling activities and vast increase in operating cost, it is not a good time to change the royalty rate. We always boost the business freindly environment and it reflects in our current state of economy. Why should we want to change this image. I think the government is running by PC not NDP !!
RRE3821 As an Albertan I want and deserve a fair share of "the pie" - but at current natural gas prices there is little or no room for a bigger government share. Wells that don’t get drilled pay $0 in royalty. The smaller the pie, the less there will be for everyone. This is too important to get wrong. [Information Removed]
RRE3822 Mr. Premier, I want you to know that I have lived in Alberta for 22 years and the big draw for me was the "can do", "entrepreneurial" and "self sufficiency" philosophy.....it has always been a breath of fresh air from the "cradle to grave" "government solves all problems" attitude that is prevelent elsewhere in Canada. I fear that the suggestion from people that getting "our fair share" from the oil and gas industry means higher "taxes" is contrary to the philosophy I have come to love in Alberta. It is not "more government" and "higher taxes" that produced our success, it is lower taxes, hard work less government that made Alberta the envy of the continent....remember the Alberta Advantage....where has it gone? You know better than I that the government is not short of funds......I hear every 3 months of unexpected surpluses, and we know there is no debt.....the government doesn't need the extra money.......but I am certain many Albertans, old and newly arrived, need their salaries? Mr. Premier, I ask you to be careful!!!
RRE3823 Alberta royalties on the tar sands are the lowest in the world at 1% until costs are recovered are far less than the inflation rate in this province. This is the paltry sum that Albertans are getting for the big black holes in the and tailings ponds that are growing around the exploitation that can be seen from space. That is all the province got for this resource for 40 years of production. An post graduate aboriginal told me that those ponds overflow in a heavy rain already and are polluting the rivers. Sycrude is dishonest when they claim to have restored 30% of the damage. Canadian Oil Sands Trust unit, the largest owner of Syncrude, paid an effective income tax rate of under 5% for each of the last seven years according to the Financial Post Survey of firms. The international president of Exxon Mobil, the operator, was the first firm to threaten Alberta over an increase in royalties. It is the world’s biggested listed oil firm reporting profits over 20% of revenue last year. As the former head of Shell said they can afford to pay more. That firm agreed to give Newfoundland and Labrador a 5% interest in its offshore oil. That field took even more years to reach production than does a tar sands operation. Why are the Canadian governments giving this resource away so cheap?
RRE3824 I am very concerned the recommendations in this report will be implemented when many of the assumptions used have been identified as being faulty. If recommendations are implemented with wrong assumptions, then the results cannot be appropriate for Albertans. We are an oil and gas province and if corporations are going to cut back on activity and put their cashflow to work outside Alberta where it earns better returns, Albertans are going to be negatively impacted. Reduced corporate investment will result in reduced economic activity meaning lay offs and not just related directly to oil and gas but all peripheral activity. It will also mean less money for government programs which is obviously exactly the opposite effect wanted.
RRE3825 I believe there are opportunities to change the current royalty system in Alberta, however I feel the report put forward by the panel does not take into account many of the factors that are critical to successful operations of Oil & Gas companies in Alberta. Before implementing the current proposals, the Government needs to fully understand the impacts of proposed changes and involve the industry players to a greater extent. My view is that if the proposals were implemented as is, the overall economic activity in the province along with the people of Alberta would suffer.
RRE3826 The royalty review has prompted industry to make much ado about the costs that they are experiencing in their search for oil and gas in the province. What needs to be clearly noted is that the mad rush that companies are currently in to get as much out as soon as possible, is the major contributing factor to this rise in costs. Additionally industry is finding itself having to compete for human resources after an abysmall track record over the las 20 years with companies letting people go on the slightest whim. Better planning by industry and a more even keeled approach to the current situation would have gone a long ways to reducing the problems that are being experienced at the present. We must not let a history of poor planning and industry practices dictate what is appropriate for a royalty to the owners of this resource the people of Alberta. A reduction in the current industry pace for drilling might be beneficial in the short and long run. Allowing stressed communities to catch up to the unrelenting demands that the current boom is placing on them.
RRE3827 The final report of the Royalty Review Panel represents the bare minimum of what Albertans should expect of their oil and gas industry. Petroleum has brought great wealth to our province, but not to everyone in it. Lower income Albertans are paying the price for cities which now cater to the explosion of the middle and upper-middle class that is benefiting from the industry boom, squeezing them out of housing and services. There are many countries in which the royalty percentages are much higher. Canada is a developed nation, but there are many left behind. The environmental costs of drilling and processing, particularly in the oil sands, takes a physical toll on the land that Alberta's government will ultimately have to take responsibility for. Taxes on the oil and gas industry should reflect the province's needs as well as the boom in profits. Of course the industry will dispute the need to pay more, but the final report represents a compromise that is more than fair to this very successful business. Sincerely, [Information Removed]
RRE3828 Dear Sirs, I am writing you to express my sincere concerns about the possibility of the Provincial Government adopting the Royalty Review Panel recommendations. I believe that the panel recommendations are very short sighted and wrong for a number of reasons. First, I am concerned that the recommendations, if adopted, will exacerbate the long term natural gas supply problem which will result in higher natural gas prices for all consumers. It is a very well known fact that the reserve life of the average well drilled in each subsequent year is much shorter than the previous (i.e. we are getting less gas production and reserves per well than we previously did) Under the proposal, there will be less incentive for any producer to take the risk to drill natural gas wells. We will have the worst case possible for natural gas pricing; high declining natural gas wells, less drilling and reserve and production replacement and less supply of natural gas; a clean fuel. This will result in higher natural gas prices for consumers and less disposable income for Albertans to spend on the Alberta economy. Second, the Province has benefited from record Crown land mineral sales in last few years. Largely, because investors believed that Alberta was a secure, stable environment to capture a rate of return on investment. Specifically, investors have taken the risk, using rigorous economic models with royalty assumptions to make decisions to invest Billions of dollars to develop the oil sands. I believe that It is immoral and dead wrong to unilaterally amend the royalty rate on the oil sands leases immediately after Alberta has agreed to accept a windfall of Crown Land Bonus payments made by investors who made this investment decision based on the royalty rates they believed they were going to be subject to. The statement “Our Fair Share” is insulting to those investors that played by the rules. Is it fair to change the rules after that investment decision was made based on set terms? Who is risking BILLIONS of dollars to develop “our” resources - Alberta or the investor? Notwithstanding this moral question, I believe that adopting the panel recommendations would be a disastrous economic business decision for Alberta. We will kill the goose that laid the golden egg with a very short sighted decision. If the royalty panel recommendations proceed, investment dollars will evaporate over night because Alberta will no longer be a stable, fair and attractive place to invest. What we will have accomplished if we proceed with these recommendations? We will have short term royalty revenue increases; immediate Crown Land Bonus revenue decreases (we are already seeing a reaction by industry) and medium to long term royalty LOSSES due to less investment, less drilling, less pipelines = less production to have royalties on. Furthermore we will have fewer jobs, less housing construction, less income tax revenue a smaller economy, less people having less money to spend on other services. Finally, currently our Province is the envy of the world. We have a revenue surplus, a healthy surging economy, very low unemployment etc. Why tamper with success? If it is working - why change it? Yes - It is true that municipalities require additional funding but I strongly believe the Provincial Governments ability to assist in this regard will be compromised by killing the economic incentive to invest in an already risky oil and gas industry. I urge you to reject the panel recommendations. My family and I have been a long time supporters of this Government. I am compelled to tell you that my friends and I will no longer support this government if the panel recommendations proceed as we will have lost confidence in the social and business decision making abilities of the Government. Thank you for your though and consideration on this matter. Regards, [Information Removed]
RRE3829 20 percent is not enough. We should ask for 10 percent more a 30 percent royality increase at least.
RRE3830 Based on recent industry study, average finding, development and production cost of natural gas in western Canada is $5 to $6 per GJ. At a current gas price of ~$6.0 / GJ, many junior oil and gas companies are experiencing financial difficulties. Any increases in gas royalty will simply put many of these companies out of business. Is this what the government wants to see?
RRE3831 I am NOT in favour of increased royalties! We should focus on building a sustainable and balanced resource exploitation regime. We also need to recognize the spin off effect energy extraction and upgrading adds to our tax base as well as royalties...it is the golden goose. The way to grow revenue from royalties is to .... - stimulate oilsands developments (no new royalties) - keep the initial start up incentive of 1% until build costs are recovered - incent environmentally responsible activities such as lower water usage, new technologies such as Petrobank's fire flood, and CO-2 sequestration. - develop an integrated industry policy to stimulate more effecient use of energy, capture of green house gases, and growth of supporting infrastructure such as highways, utility and pipeline corridors. - stimulate in province bitumen processing through temporary or time staggered royalty credits. - incent legacy oil and gas field production and secondary recoveries through reduced royalties on marginal producing areas. Don't leave oil/gas in the ground...marginal production (e.g. what some Roy Trusts target) goes on for decades and sustains local jobs and industries. Old oilfied secondary recovery and stripping techniques utilizes existing infrastructure and offers environmental benefits such as CO-2 sequestration.. The bottom line is that we are getting more than a fair deal from our royalty regime as it is. We should be focused on exploiting our tarsands through expansion and in province upgrading and refining. We should also be stimulating legacy oilfield production and green house gas sequestration. Unfortunately I am an sceptic of having my views read, let alone receiving more than a canned response. However, I leave it to you to prove to me that this is more than a sham of public consultation. Over to you....
RRE3832 I don't believe the royalty review does enough for the citizens of this province. It is a good start, but the people of Alberta should be receiving their fair share and this review does not present that. The fact that the oil companies are threatening to leave or reduce production should not influence the government's decision in a time when we are booming and having to import labour from other areas. If the economy were to slow a bit due to the government's acceptance of this, then maybe we could catch up and think about a sustainable future for our province and our resources. Be smart Stelmach and accept this royalty review as a good start in addressing the needs of Albertans and not crumble from industry pressure like the government did during King Ralph's reign.
RRE3833 Please stop this runaway train and CAREFULLY consider all the effects that the implementation of any Royalty Review recommendations. My family has worked in the oil and gas industry for nearly 30 years and has felt the financial setbacks of poorly thought out and hastily implemented programs (ie...the NEP and the Trust debacle). This has the potential to become a disaster for many hard working Albertans, as it is occuring during one of the slowest drilling seasons in the last 10 years. Let's not mess up a good thing for our citizens!
RRE3834 I am sending you this email in response to the recommendations made by Royalty Review Panel to increase the royalty on both oil and gas in Alberta. My concern is if the recommendations are approved and implemented, it can send Alberta’s economy into turmoil. I work in the oil patch and within the present economic environment, we struggle to drill an economic gas or oil well. Cost of services have gone up and the easy oil or gas targets are a story of the past. A lot of money is spent on the technology to find new ideas for exploration as well as to improve the efficiency of the wells. In short, several thousand jobs are related to the implementation and advancement of the technology in the oil patch. We moved to Canada from a developing nation and we have seen and suffered the negative impacts of laws targeted towards a specific industry in the developing country. I am strong believer in learning from the mistakes and I wish not to see or suffer the economic turmoil in a developed nation. I believe with the increase in the Royalties, there will be a marked decrease in the investment of oil and gas projects. In short; EFFECTS OF HIGHER ROAYLTIES: Job Losses Social Stress Family Disturbance Lower investment Real Estate decline In response to the statement “People of Alberta will benefit”, I would say maybe, maybe for a short term but in the long term, people of Alberta will lose and suffer. Thanks [Information Removed]
RRE3835 Hello, I am a 34-year old native Nova Scotian who made their way to Alberta 10 years ago. I have enjoyed the prosperity that most other Albertans have enjoyed in that time and plan to stay here for the foreseeable future. I call myself Albertan at this point because I live here and have a vested interest in the future of this province. I have been involved in many discussions regarding the Royalty Review and it just so happens I work in the Oil & Gas industry. The review raises many concerns: - Was the information used accurate and complete? - What are the planned uses of the money now? And in the future? - Did you have adequate discussions with all stakeholders? - Did the review panel factor in potential costs based on potential environmental legislation? What I think needs to be done is present the information gathered and recommendations in the simplest form you can for the people they are making the decision for, the Albertans. This is our resource which we have entrusted you to manage on our behalf and we need to understand how this will impact us and our current/future standard of life. This has a potential impact on our economy that has not been completely analyzed and therefore not disclosed. We need to understand and you need to help us. Digesting a 102 page report is difficult and I'm currently at page 42. What I suggest you do is the following: - Create and deliver a television program that is played for an entire week on various channels at various times that showcases what the Royalty Review has determined. Keep it simple and too the point but make it as transparent as possible. - Allow stakeholders in the Oil & Gas industry to do the same thing, potentially broadcasted right after that highlights their concerns and proposed changes to the Royalty review. - Air a 2-hour discussion/debate between the Royalty Review board and Stakeholders on various channels at various times the week after the first two have been completed. - Hold a public plebiscite giving the people the chance to give their opinion. I honestly think making any decision at this point would not be good. Engage the stakeholders and determine the best forward for everybody impacted. I'm firmly not in favor of the recommendations of the Royalty Review board being accepted at this point and I implore to wait until you have complete enough information to do so. Sincerely, [Information Removed]
RRE3836 I would like you to accept all the recommendations of the royalty review report. I would suggest to go beyond the report as suggested in the Parkland Institute review. I was very disappointed at the remarks you made, as reported in the Edmonton Journal today. I don't think that you have really grasped what the majority of Albertans want. Thank you, [Information Removed]
RRE3837 I have heard through the media, conversations with friends and co-workers the pros and cons on the royalty review report. I currently work at a oil & gas producer and do feel that a change to the royalty structure would signifigantly impact how much our company would invest in Alberta. I have worked with several business units in my role as an engineer and know that we are like any other business, our goal is to make money for the shareholders. If a change in royalties makes a project in Alberta not as attractive as one in Sask. or BC we would rank it accordingly and the money will be invested in outisde of the province or even outside of the country as we have operations in numerous other parts of the world. Money that is spent in Alberta will stay here through the many small businesses such as motels, coffee shops, convenience stores etc.... I personally feel that an increase in royalties will effect the quality of life for Albertans. Less drilling will be seen in Alberta should the royalities be increased and a short term gain will likely lead to a long term fall in terms of financial wealth and quality of life for all Albertans. Regards, [Information Removed]
RRE3838 I believe oil and gas companies can afford to release some of those royalties back to our province. They are making their money by depriving our land of its resourses. Therefore they should NOT be getting off lightly.
RRE3839 I work as an in-house consultant for [Information Removed]. So far, 2007 has been a tough year in the oil and gas industry. [Information Removed] drilling program in Canada this year is half what it was last year. In the spring, hundreds of contractors were let go from [Information Removed]. Thankfully, I was able to renew my contract. Also, many of the companies that [Information Removed] sub-contracts to have been forced to lay off a significant percentage of their staff this year. I have many friends who have come upon hard times this year due to such cut backs. Currently our economy is in an awkward stage, especially with the Canadian dollar at par with the U.S. dollar. If royalties are increased my LIVELIHOOD will be endangered. For those Albertan's who believe that a royalty increase would not directly affect them because they do not work in oil and gas, they are very wrong. The value of EVERYONE'S property in this province is impacted by the oil and gas industry. If this government carries through with a royalty increase I guarantee that it will lose my vote. I have already begun to lose trust.
RRE3840 I have read the report in total and followed closely the press followup. The report is not just compelling, it is overwhelming in its conclusions. I support every one of the recommendations. The opponents to the review are huffing and puffing, but so far, their arguments have been content free. Applied to a farming analogy here is what they are saying: If you have a farm to sell and you have an offer for $1000, take it, even if you have heard that the same type of farm down the road sold for $3000. After all, you inherited the farm, so $1000 is fair and money in you jeans. Don't waste time and effort in finding out the true value of your place, that's bureaucratic and a waste of time. Such baloney! Mr Prremier, approve the WHOLE package.
RRE3841 Do your homework people. what you are proposing could have drastic effectson/ the oil gas sector/small business and the tax payer. I see lost jobs, higher fuel prices,even economic recession. [Information Removed] tax payer
RRE3842 RE: Comments invited from the public Royalty Review AB GOVNT, EDMONTON First I must compliment The Premier The Hon. Ed Stelmach on carrying out a review of oil royalties in a very open manner. Also, selecting the very able independent team that was assessing petroleum resources royalties. I will attach my comments to the Commission & Premiers on my opinion on this matter as well as on the performance of the previous administration on a range of matters and their priorities. A lot of problems within the Alberta economy could have been solved without the pain to average working citizen; certainly on the working poor, those on fixed incomes, as well as the neglected Heritage Fund, if Alberta had set up a proper smart businesslike royalty regime in the first place with automatic adjustments based on oil/gas prices and related profits of the Companies involved; as other countries have done. All I can say is that the Alberta people have been cheated out of their heritage because of the sloppyness of the previous administration. When the people read Premier Kleins slogan ......"Ralph cares" they thought he meant the people!! ... i.e. not just Ralph and a select group of his wealthy Corperate friends! As the royalties adjustment (approx. 20% incr.) proposed by the Commission brings us modestly up to "middle of the pack" I would recommend immediate implementation of the RRC recommendations. Any delay just results in the continuation of this sad state of affairs. Delay is just a play by the Corporations to keep their windfall profits rolling in. To hear their self interested whinings is like watching a greedy boy caught with his hand in the cookie jar and still dosn't want to share with his friends. I would like to see a full audit of the past two year royalties of the international Corporations that 'self assessed' their productions; ... talk about the fox watching over the chicken house!.... and the immediate setting up of a Dept to oversee all royalties owed to the people of Alberta. Immediate implementation of the RRC recommendations is my urgent appeal to our Provincial Govnt. Thank you, [Information Removed] ----- Original Message ----- From: [Information Removed] To: royaltyreview@gov.ab.ca Sent: Wednesday, September 12, 2007 12:13 PM Subject: Citizen communication to petrolium R.R.C. ATTN: Royalty Review C. EDMONTON This is a copy of my comments as an informed citizen to my Provincial Representatives that I sent 26 February 2007, that you may/ or may not have received in your submissions. In case this was not communicated, I will enclose my email which has many sections relevant to the oil industry in Alberta and the failure of the Government to represent the interests of the ordinary working people, and future generations, of Alberta when entering contracts with big business interests in the resources of this Province. They are lop-sided & favourable to 'Big Oil'; e.g. it is a standing joke in Texas how cheap the oil is 'given away' in Alberta. We do not even have a "Windfall clause" in the agreement!!. Norway did the right thing by their people and they have reaped the benefits. The oil Companies are not complaining there either,... they have what we may call a "fair profit". I realize this may be late, (if it hadn't come to your attention earlier),.... but better late than never. [Information Removed] Copy of Email to Alberta Govnt Repr.:- Sent 26 Feb. 07 ATTN: The Hon. Ed Stelmach The Premier ALBERTA GOVERNMENT I am writing in support of your many of your policies, and would like to forward you my suggestions/ comments/ support/ critizisms of the last administration I mailed to Ralph Klein; i.e. feedback which I was hoping may have been of assistance, and benefit to the Province, in the long term planning by the Govnt here & which has been sorely lacking; eg our Province is being suckered by the big international oil Companies, and the social policies, environmental,... have been a dismal failure:- "Follow up on;- The Survey/direct comments/suggestions/We live in hope!" As I favour your stance on many of the issues and your leadership, I trust these comments may be of help to you. [Information Removed] ----- Original Message ----- To: premier@gov.ab.ca Sent: Thursday, August 24, 2006 5:13 PM Subject: Follow up on;- The Survey/direct comments/suggestions/We live in hope! ATTN: The Hon. Ralph Klein The Premier ALBERTA GOVERNMENT Dear Sir, This correspondence is just a follow up on my email to you and my local Conservative Repr.'s in Edmonton last December when you invited comment (Survey). As I did not receive the courtesy of any acknowledgement from anyone in your Party, therefore, as I do not know if you received my email and suggestions, I will attach the original email again for your convenience; mainly as it has a brief list of recommendations and positive 'Visions for the future of Alberta' that seem sorely lacking in this last administration; (except maybe for a selected group of Corporations and individuals with connections and influence). I was pleased to hear several of these recommendations put forward by my email, and, clearly by many others; were attended to by yourself, [even if only partially; which is better than nothing]; i.e. :- * Direct return of resource wealth to the people. Your "Prosperity cheque" was a step in the right direction and that has been the only benefit many citizens have seen from this 'oil wealth' [those on fixed incomes, hard working people at the bottom of the pecking order, etc]. A pity it wasn't based more on the Alaska model:- from dividend, at least four figure $ amount, at Xmas, to those living in/contributing to the Province for at least 5 years; and excluding the wealthy. Unfortunately while you are still charging H&HC 'tax' that cancels out this benefit to families in Alberta; and all it has done has made the rest of Canada envious and looking to stripping us of our wealth. Why would we trust the Conservative administration to "Reform" [another buzz-word for 'privatization'] the complex & more vital & important Health-care system if they made a mess of the simpler Power System?! Furthermore, why would we put our trust in the Insurance Industry; have you/ or know of anyone trying to get the Insurance industry to honour their contracts.... you will know that they are all scoundrels & thieves, just look at their disgusting profits! and we are supposted to trust them with our health.....! * Your stand against some of the more radical reform proposals of your Health Minister Iris Evans was a pleasant surprise to me. I have no objection to cosmetic surgery and other vanities being a 'private for profit' system. However & unfortunately, regards vital/necessary health care; despite the evidence of countless studies to the contrary [proving that a Public System is more cost effective (eg bulk purchases, etc), and egalitarian than any private for profit health care system], your Party is still obsessed with privatization; (even with the privatization of the power system boondoggle still on all our minds, which we are all still paying for). Clearly, 'Ideology' is getting in the way of common sense. * Glad to hear of your approval to some expansion to Alberta Environment; [i.e. Envir. Emerg. Preparedness Team]. However, to have made the excuse that "we never foresaw such a disaster [as L. Wabamum]" is a pretty lame excuse for the Govnt not being up to the job, particularly with many examples and regular warnings of these events in Canada & around the world. Even my humble letter in Dec. warned of the foolishness of your Govnt gutting the Environment Dept. & Environmental staff from other Depts; reliance of the good graces of the Corporations....Please!! .... have you ever heard the one about the foxes looking after the chicken-house!. Regards extreme right conservatism; don't bother reading the "Wit & Wisdom of George W. Bush" its a very skinny book. To a man who enjoys fishing and the outdoors (I am an outdoor enthusiast myself), I cannot understand why the beauty of this Province is not appreciated and protected by this Govnt; Watershed protection should have been uppermost in your mind when one with with the river, the trout, the mountains and the fresh air. I see the big Oil Companies & Multinationals are still laughing all the way to the Bank, even louder now; simply put, your Govnt has been suckered by those guys. Unfortunately you have let ALL the people in Alberta down to be suckered by Big-Oil. We could have supported Environment, Education, Infrastructure, Heritage Fund, Cancer Research, Homelessness, etc, etc. Those lost Royalties have been lost forever to us; its an extractive/ one-time-use product industry, for Petes Sake. Look at Norway, their Heritage fund started later than ours and is several times larger now; thay charge smart Royalties; dont give/believe the excuse of oil-sands difficulties; Norway has to get its oil from the North Sea!! Regards homelessness, State welfare clients, etc; a measure of Good-Government is the compassion it shows to its most dependend/weakest citizen; to date, this Govnt has failed miserably. On a more positive note, if you bring in my short-list of recommendations before you retire, I will consider you a hero, maybe Superman (as you have only Autumn to do it!); and your Legacy will be intact, with me anyway. I wish you a long and happy retirement, [Information Removed] ----- Original Message ----- To: premier@gov.ab.ca Sent: Friday, December 10, 2004 2:51 PM Subject: The Survey/direct comments/suggestions/We live in hope! ATTN: The Hon. Ralph Klein The Premier ALBERTA GOVERNMENT Dear Sir, As a citizen and resident of (r)Edmonton, Alberta, I would like to extend my congratulations to you on your re-election. If you can imagine:- ...... we are just sitting down together over a beverage of your choice where we talk frankly about the state of the Province, the World, and the direction we are traveling,... ["go boldly (into the new frontier) where no man has been before......."] I would just like to start by saying you don't need those people with tunnel vision, lobbyists, big bus.vested & even foreign interest & 'Party Hacks' telling you how to think, particularly those two jerks, West & Love; go with your own sense of the peoples aspirations, just listen to them. Please, if you need an idol, use Canadian Tommy Douglas, NOT Roger Douglas. If you want to leave a Legacy:- Lets see your Govnt (for a change) be a good steward of the natural environment (Land, forest, prairie & wetland conservation; soils, water & air quality) and the economy will follow; you will be thanked by our future generations (not cursed); rebuild the Dept you once led and give the scientist greater scope and allow initiative to grow rather than as lap-dogs to the industrial-govnt complex with only short term bottom-line interests & the next pathetic election. I would like to see a Vision / Mission from your new mandate period, utilizing the resources of this Province in a more equable & long-term manner than in the past: * Demanding a fairer share, i.e. higher Royalties from the large & multinational Companies who are presently taking advantage of this Provinces resources, and laughing at us, all the way to the bank. The resource (oil, forest, etc, plus political stability must be worth more than the few dollars in royalties we receive from it,- compared to other countries!) Venezuela said they would raise royalties dramatically, the Oil Co.s said they would leave; guess what? the royalties were raised, the oil Co.s are still there pumping oil! * Sharing this wealth directly to the people as a Dividend rather than the Govnt dictating 'what is good for us'. * Proportional Representation for fairer democracy. * Environment first, not last. * Respect the Public Service (as you are one of them!) * TRY & be empathetic with the less fortunate....please (I know it is hard for the privileged class in Alberta, those that have benefited dispropotionately from this wealth; why should they care I guess you ask). I wrote to your PC Representative in Edmonton Centre the following; i.e. prior to the election, [rather harsh I suppose looking at it now], anyway, for what it is worth.....:- With regard to the 'Survey inviting input' & later, your Party's promo. message on our answering machine:- I would like to comment about your Govnts performance as we see it & that survey that was said to have been sent to "all" Albertans, inviting comments on direction for the Alberta Govnt. I will send my comments directly to your office, as: First, we did not receive this document. Second, we asked for one to be mailed, were told it would be & we have yet to see it. Third, tried to fill it in on the internet & kept getting error messages when attempting to get on the surveys stated website. So, my conclusion is that the PC Party really did not want our input, as your Govnt has been said to rarely ever listen to constructive criticism to date (from health care, environmental, energy, and other public groups); so it just confirmed my/& others experience in perceiving an arrogance. Therefore the survey inviting input from "all" Albertans for comment & suggestions on future direction of the Alberta Govnt (as, is evident, the present PC Govnt is apparently devoid of Vision & Mission). Unfortunately, confirms my suspicions that, as well as having hidden agendas on privatizing public services for profit, the present PC Govnt is really are not interested in our opinions, reinforced by the fact that: 1. The questioner was never received here. 2. We phoned & asked for one, it was promised by never arrived. 3. Tried to fill it in on your stated internet site, and was continuously given an error message. I can only conclude that, as many people have been reporting, that the present Conservative Govnt, have become so self-centered & arrogant they are not interested in hearing feed-back from, what they perceive as, the ignorant masses (i.e. "We, the People" of Alberta). The Questioneer was just a cynical ploy to con us to think 'The PC's Care'. This Govnt, like their American Republican Cousins to the South, only listen to their 'Big Business Buddies' that are funding their re-election; where is Democracy.....? The only claim the PC's have made is that they have "Paid back the Alberta debt", Oh, big deal, what vision! a debt which, I must point out, was what they created in the first place!! I note it was eventually balanced on the backs of the working poor (lowest min. wage in the country), the elderly, sick, and the dependants, who, this Govnt & its leader seem to despise (reinforced by public comments). This could have been balanced more quickly & less painfully on the people of Alberta if your PC Govnt had collected rightful Royalties on OUR Natural resources particularly oil production from this Province; collecting less than one third that collected from oil production by Alaska & Norway, The Govnt have given away & squandered the resources of Alberta, energy, forest & human, for the benefit of multinationals & big business. The present Govnt have also destroyed much of our natural environment in the process, favouring these often foreign owned multinationals over environmental common sense and the health of the Alberta ecology and of our people; gutting the public service & Dept of Environment, e.g. putting highly qualified environmental scientist out on the street. Although our Members are 'Public Servants' themselves, they seem to devalue the contribution of these many dedicated peoples. Instead of the family farmers receiving BSC aid, most went to profitable, mostly foreign owned, Packing Co.s that took advantage of the bumbling PC Govnt & Minister of Agriculture, and in turn, we the people. The Conservatives fanatical doctrine on privatization has resulted in higher prices for electricity, natural gas, Insurance, etc, for the average family. Prior to privatization, even I were driven to call in to a CBC talk-back show to warn a Govnt that wasn't listening of the consequences of privatizing electricity to a monopoly situation (where the market forces don't work), having directly seen the results overseas; I guess the PC Party only have time for greedy business friends where profit is the only motive. That Idol of private ownership Roger Douglas has already been discredited in his own country as a one-dimensional thinker where they have had to reverse many of his reckless disasters. Why this H&HC Premium? again hitting the family unit, just because this Govnt wants Health Insurance of some form to open the gates to private insurance in the future; where money is more important than people. Get rid of that 'Tax',.... a wasteful bureaucracy would be gone too. A word to ALL Political Parties, the resource royalties belong to the people, NOT to the Govnt of the day. Put aside this paternalistic attitude of Govnts in Canada to spend our money for us! and give, at least a proportion, of the money directly back to the people, and modify your Govnt big-dream schemes. We can spend it more wisely than you. So my suggestions for what they are worth are: 1. Get rid of Health & H. Insurance (even some 'poor Provinces' don't have it! for Pete's-sake.) 2. Give OUR resource/oil royalties BACK; i.e. in the form of a dividend cheque (ALL residents of over 5 yrs in Alberta) before each Xmas, as Alaska does....... a couple of thousand dollars may not be much for a rich man but it will make a big difference to the life of the working poor, mothers, children, seniors (who incidentally built the Province) and others of limited means. 3. Get Proportional Representation, get democracy, and stop this dictatorship situation (whatever Parties in power). What is it with all this fuss about Gay Marrage, and money wasted fighting the Federal Govnt on this, health care, & other matters. It seems the comfortable 'moral right' are living in a privileged world of their own. If they want to talk morals:- we have food banks, homeless people in the middle of winter, children suffering from malnutrition in this Province,...its a disgrace.... and you guys are worried about gay-marrage; give me a break. Anyway, that is my feedback in response to your PC Party/Govnt invitation for same. Thank you for your patience & have a HAPPY XMAS Hopeful of Enlightened Representative Democracy, a more equable society, and 'Social Justice' for the sake of all our futures, [Information Removed]
RRE3843 [Information Removed] announced today that they will spend all of their money in Saskatchewan next year if the royalty review is adopted. DO NOT fall for their play. In the first half of this year 57 of 59 wells that they drilled were in Saskatchewan and through recent acquisitions they have switched their focus entirely to our neighbours to the east. They should be ashamed of themselves!
RRE3844 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 12:46:39 DATE ENTERED {ts '2007-10-02 13:00:00'}
RRE3845 In light of the recent recommendations made by the Royalty Review Panel, I would like to further touch upon revenue generated by land sales. 3.43 billion dollars in land bonus payments were made last year, that apparently were excluded from government revenue calculations. In the appendix of the report it states ""It is a real challenge to include bonuses in the kinds of models used here," it said. "Actual observed bonuses vary with price and cost conditions which makes it very difficult to treat these in a meaningful and appropriate manner in such models," However, with sales revenue this significant (close to 50% of total royalties) how is it possible that the panel can neglect land sale revenue in their calculation? The numbers look skewed and unfair.
RRE3846 Are you people Crazy? What kind of investment enviorment are you trying to create? Canada is not Russia. Billions of investor dollars have been invested in the oil sands are at stake.The oil sands are owned by the Canadian public not the government.Leave the Free markets do their job.Don't put taxes in the way of progress and kill the returns needed to keep economic projects alive. [Information Removed]
RRE3847 I agree with the conclusions of the Royalty review and wish to see them implemented as soon as possible.
RRE3848 If the Alberta government were willing to act on its belief in competition and 'leveling the playing field' it would allow oil companies to compete for Alberta's resources--including the tar sands. The only way to do this is to set royalty rates at levels comparable to those in other jurisdictions. Carrying on with the present royalty structure can only be interpreted as a "sweetheart deal" offered only to corporations that are friendly to the government. That would be bad policy and potentially a conflict of interest, even if it weren't contrary to the interests of all Albertans. It's time to walk the walk instead of talking about principles like competition without implementing them. [Information Removed]
RRE3849 I believe the oil companies are given too much leeway already. The Alberta government must do a better job of collecting their fair share of resource revenue (increase royalties!! actually collect royalties!!). The threats from industry players like Encana are HOLLOW! Do you really think they're going to up and leave all of the oil up north (liquid gold) in the ground and go somewhere else?
RRE3850 The review panel's report did not appear to adequately address the follow-on economic impact reduced capital expenditures in the Western Canadian Sedimentary Basin. While I agree that higher oil sands royalties may be desirable, I am very seriously concerned that the full economic impact of a royalty change has not been considered. I strongly believe that a conventional royalty adjustment will have a negative near term impact on Alberta's economy, despite the fact that it may increase near term royalties received by the government. The Alberta economy is very strong and the conventional oil and gas business continues to incentivize producers to maximize production for the province---why are we trying to fix something that is not broken?
RRE3851 I think the review is too extreme. I have been notified by two major Oil/Gas companies that if the Royalty Review is adopted in full, they will pull major investment & development dollars out of Alberta and use them elsewhere, as well my services and employment with them would be questionable, if not deemed uneccessary if the cuts were to take place. I live in a Oil/Gas dependent community and have seen impact due to already reduced activity/drilling in the past few years. As some in our industry are only able to work 9-10 months of the year, we need the work to be there for our livelihood. I was born in & love Alberta, I have voted Conservative my whole life and had no doubts until now. If the royalty review is implemented in full, and my work/life/livelihood is seriously disrupted, I will definitely be reviewing and adopting another party for future elections.
RRE3852 I strongly urge the Alberta government to, at the very least implement all of the recommendations of the royalty review panel. All of the arguements and positions that that I have personally reviewed leave me feeling no doubt that the resources that belong to the citizens of the province have been sold at unacceptably low prices for far too long. I believe that contrary to the claims of the powerful and well conected oil industry executives, the Alberta and Canadian economy will not suffer if these recommendations are implemented. On the contrary, I feel that it is the industry itself, with the mind boggling rate of investment (with the permission / encouragement of the provincial government itself) in the oil sands and the industry in general, has caused many of the present problems the province faces. These include: lack of affordable housing, employee shortages, rising costs for individuals, business, and governments to repair and replace existing infrastructure, as well as limiting the ability of the above to undertake new construction projects due to costs (i.e. the Edmonton Clinic), environmental degradation and a general disaffection with the state of living that many Albertans report. Any slow down in the economy would be a welcome reprieve from the excessively overheated growth and allow development to occur at a more sane and sustainable pace. I have always failed to comprehend why such a useful and finite resource, that will only become more precious, is treated as though it all must be removed from the earth and used as desperately fast as possible. Let's use it wisely and judiciously, for the benefit of all. [Information Removed] Edmonton
RRE3853 As a Grande Prairie small business owner - [Information Removed] to making any decisions on the royalty report. Please ensure that Oil & Gas economy is not effected in a negative manner - If a negative result occurs you tax base will still drop to lack of work from both the businsess and the Oil companys. Also ensure that all facts are current in this report .
RRE3854 I believe the implementation of the new royalty will definitely hurt Alberta’s economy. It seems that the majority of the Albertans support the final report from the Royalty Review Panel, however, how many of them understand the oil business. Everybody believes that the oil companies are making more money, so they should pay more to Albertans. It is true that oil companies are making a lot of money those days, however, oil companies are make much more money in other part of the world than in Alberta. They may get over 40% return in China, over 20% return in Australia, but only 12% in Alberta. If this new royalty got implemented, the big oil company will move their investment away from Alberta and invest in other part of the world. A lot of the projects will be shutdown since those projects will not be economic any more, the small players may either close their business or move their business out of Alberta. Alberta may get two more billion revenue from the new royalty, however, due to the fast production decline, and not enough production and new reserve added, can Alberta continue to get this two billion the years after? Since the return rate is lower, the big companies are already cutting their budget in Canada, BP has sold out all of their oil sands and only keeps the current production, no much investment in Canada for quite a few years. The industry is slow down, the wells drilled this years reached the five years low. The new royalty policy will make this situation even worse, there be a big lay off in oil companies, then all the directly related service companies will be hurt as well, then those indirectly related,… we can foresee the Alberta’s economy will be hurt. You correct this mistake when it happens, however, how long it is going to take, five years or ten years? So please don’t do it, let all Albertans know the reality.
RRE3855 Please support the Royalty Review Panel's recommendation to increase royalty revenue. The oil companies threats to delay production could be seen as an economic benefit as it could level the playing field by avoiding spikes and valleys in our economy. The oil belongs to us, the people of Alberta and if it isn't extacted today it isn't going anywhere. Let's take a lesson from Premier Danny Williams.
RRE3856 I am working at [Information Removed]. I am the breadwinner of my family and I am asking you not to implement the panel's recommendations. If you want me to beg, I will do that as well. [Information Removed] provides me with income so I can provide for my family, directly. If you implement the panel's recommendations, that will end immediately. Hence, please allow Albertans to be employed and allow them to make a living. I am interested in money in my pocket every 2 weeks. I cannot buy bread with royalties money going into the province's pocket. You kill [Information Removed]in Alberta, they move elsewhere. End result: Albertans lose, elsewhere people benefit by means of gainful employment. So please, I am an Albertan, I need to be employed. Don't take opportunities away from us. Sincerely, [Information Removed]
RRE3857 I think the royalty review recommendations as a whole are fair and balanced; if it slows down oilsands activity somewhat, that would be a good thing because things are way too overheated right now. The town of Ft. Mac cannot keep up with the infrastructure demands placed upon it thanks in large parat to the lack of help from the government which send billions of dollars to Edmonton and Calgary where the votes are and ignores the needs of Ft. Mac with its smaller resident population and a large transient population that needs services but doesn't vote in Alberta. In my opinion the report is missing a crucial missing element which would have unlocked more of Alberta's resources as well as fostered environmental protection. I would like to have seen royalty incentives for unconventional gas such as CBM and shale gas which is a huge part of the energy supply picture in the U.S. Also missed I think were incentives for enhanced oil recovery utilizing captured CO2. In view of the fact that the premier hasnot received a mandate from the electors of Alberta; he should bear in mind that people get to vote for politicians and not oil companies.
RRE3858 I am concerned about the impact of the royalty review as an Albertan and an employee of an energy company. I understand how oil & gas project economics work. I understand my company's responsibility to our shareholders to maximize the return on the investment they've made in the company. I don't think a royalty change will effect the health of the company I work for but it will effect where the company executes projects. I think the investment will move to the US and other parts of Canada. And that will effect the economy of Alberta and well being of Albertans. I hope you will carefully consider the impact of royalty changes.
RRE3859 I urge the government to implement the royalty report. This is not a radical document but reflects what independent studies have been saying all along. Is this a government for people or corporations? Don't listen to the corporations. An increased royalty represents good public policy and they have nowhere else to go.
RRE3860 I am a small producer in Alberta. The government recently eliminated the Alberta Royalty Tax credits,which has a significant negative impact on small producers cash flow. Now the implications of this royalty report are, that the small producers are going to have to pay even higher rates. If these recommendations are implemented, it will make the physical enviornment such that small producers, can not afford to drill and the industry will slow down significantly. If the industry is forced to stop drilling, the government will not get thier expected 2 billion dollars and with less people working in the industry, the income tax revenue to the province will be significantly less. Small producers are paying thier fair share and then some. I ask you to take a hard look at basic economics before you charge us more royalty. [Information Removed]
RRE3861 Just what the world needs (MORE TAXES) when are the political brain dead going to understand, this will create thousand of jobs for canadians as well as Americans, you dip into the pot and all it does is make everthing harder to accomplish. You will get your fair share through growth and job creation, don't be a bunch of idiot's and make if tougher on industry to produce. BIG PICTURE REMEMBER.
RRE3862 The CEO's Chairmen and Sr. Executives of the oil and gas industry ([Information Removed], are not saying "do not raise royalties"... they are saying "take a step back, do more review from ALL sources, and include industry experts in the review, then whatever adjustments you make to royalty regimes, ensure they are fair and will support a continuing healthy Alberta's healthy economy". Both sides to this critical debate should be entitled to contribute details, and corroberate reports, before any decision is to be made. But so far, only one side has been offered the opportunity to present any details of influence to your cabinet. That is unfair, and very risky. The Review Panel's recommendations will only serve to "shoot the golden goose", or at least severely maim it. If you think to give Albertans a bigger share of the royalty pie, beware that you do not cause the pie to shrink down to the size of a tart. Please take care on how you make this decision, and make it right for ALL Albertans, not just the ones who naively think they are not getting a fair share. Thank you [Information Removed]
RRE3863 Speaking bluntly as a taxpayer not employed in the oil & gas industry I think the royalty increase recommendations are excessive and will seriously hurt the provincial economy. The province has done extremely well as a result of the boom in the industry... and I don't disagree with the province getting a slightly bigger piece of the pie, BUT this is much too extreme. I won't comment on the negatives that will flow frrom this only because you've heard it many times already. Suffice to say I and my family and close friends with whom this has been discussed are very upset and concerned.
RRE3864 I have a hard time to understand you people.the province is in the black and doing well finacially and now we want to get greedy at the expense of employment of the people.The gas prices are presently low and the job market reflects that already,if you clowns but this royality on you will see major unemployment and then you can toll out the money on the other end in unemployment cheques.I urge folks to start acting for the people rather that the pocket books of the province.The streets will be full of tumble weeds if you put this in.
RRE3865 Fact: the oil companies make money from pulling oil from the ground. Fact: if they don't take it out now they will take it out later. By taking royalties you will secure revenue today and in the future for the government and people of Alberta.
RRE3866 Mr. Ed Stelmach My name is [Information Removed]; I grew up in a small town not far from yours, [Information Removed]. My family roots in the community are deep with agriculture and business. In 1996 at the age of eighteen I left home to work on the service rigs, as jobs in the community were nil and I had no secondary education. I progressed though the positions on the service rigs over the next few years and eventually went back to school for Petroleum Engineering Technology. Upon graduating I went back to the oil field service industry as a manager for a small service rig company. In 2006 I left the company and started my own service rig company out of Camrose. We currently employ about 25 people and work for about 15 different oil companies. We have two rigs with a third to enter the fleet by mid October, but there is a problem. I have no work lined up for the normal winter projects as Oil and Gas producers have slashed budgets due to low gas prices and uncertainty with the proposed royalty review. I have read in recent days that other service companies have had to start layoffs and I hope this is an option that we can avoid. I agree that Albertans deserve there fair share, but my employees are going to get no share if there is no work for them to go to due to a saturation in the market of service equipment when the major oil companies slash there budgets. Currently we pay nearly $230,000.00 in provincial Income Tax on behalf of our employees yearly. As a company in rural Alberta we employ rural residents, which in turn they use to sustain a rural economy. If we were put in the unfortunate situation that we had to layoff our employees they would then be eligible for EI benefits and unable to contribute to the economy around them putting further burden on Alberta’s robust economy. You are not affecting the resource companies as much as you will destroy jobs for every day rural Albertan’s, resource companies will just look outside the province for other opportunities. We are a small company that believes our employees are our number one asset, but as you can see I am a very minuet part of this industry. With the uncertainty that you have put into the Alberta Oil and Gas market, you run the risk of depleting and destroying thousands of jobs that will result in a loss of Billions of dollars that would have entered the Alberta economy directly and indirectly from Oil and Gas activity in the province. Sincerely; [Information Removed]
RRE3867 Are you crazy? Do you remember the 1980's when the NEP was inplemented - what it did to Alberta's economy - it took us 15 years to recover - what people don't understand until it is too late is how important and vital the oil and gas industry is to Albertans. Yes I now work in the oil and gas industry but in the 80's I worked in an engineering company - the results of that bad decision filtered down into our sector as well as hitting all the other sectors of Alberta ... please rethink what you are about to do ... is the Review Panel made up of Albertans or those from other Provinces? It is difficult to believe that our Alberta government would intentionally hurt out province. [Information Removed]
RRE3868 Reading and listening to the news reports on the Alberta Energy Industries response to the Royalty Review report has compelled me to write. Assuming the report‘s information is correct, it does seem that there is substantial room for an increase in royalties. I strongly hope Premier Stelmach and his government do not back down in the face of threats by the energy companies. The energy companies seem to forget that the resources belong to the people of Alberta and if the pace of extracting those resources slows it may be a welcome relief for many. The resources will still be there for the people of Alberta to sell. The threat to pull out to another venue is not believable since where do they plan to go, and if they do there will be others to take their place. They will of course blame any slowdown that is actually due to difficulty in seeking workers and other increased costs due to the boom on the royalty increase, but I think we can live with that. Today’s Calgary Herald has an article that warned doom and gloom for charities that the energy companies support. These include hospital and university donations. I think it would be more appropriate for these entities to be better funded by the government in a consistent plan than to rely on the charitable whim of corporations. Larger royalties should allow the government to provide better funding for our medical and educational institutions as well as maintain the province’s infrastructure. This would benefit all the people of Alberta. The energy companies have raised the bar so high in the competition for workers it is damaging many smaller companies, non-profit organizations, and other groups who do not directly benefit from this boom. In summary, I think that a reasonable royalty increase should occur. Sincerely, [Information Removed]
RRE3869 I believe that the royalty review panel got it wrong and their recommendations, if implemented, will harm the provincial economy to a much greater extent than they anticipated. I say this because, in part, their recommended changes where motivated by a perceived need to cool the economy down. Re: news paper articles Calgary Herald Friday Sept. 28th, 2007 "Red-Hot Economy feels chill of Inflation" The economy is already cooling down Due to normal economic forces of inflation. due to the high price of finding smaller and smaller gas reserves coupled with the low price of gas rig counts are down and the natural gas sector is in a slump at this time. Many companies will find it hard to survive the winter let alone be able to raise the capital needed to drill wells for reserve replacement. Introducing higher royalties on this sector will have a dramatic effect and hasten the down turn. Many rural towns in this province have been successful in diversifying their economic base adding oil field services to their traditional agricultural services base. These people will be hurt dramatically. Re: News paper article Saturday September 29th "Encana makes $!B threat" I don't believe that it is a threat. Encana will have done the analysis and is stating their reaction to the proposed changes. I know that they have met with government officials in the last few days and perceive the threat of the recommendations as being implemented as real. Our largest Canadian oil company, who would value their relationship with the government, would not make false claims. They would also not lightly publicize to their shareholders that their business would be hurt to such an extent that they would need to cut back their capital program so drastically. Few companies will go public with there reaction for fear that the markets will react poorly. Encana is just the tip of the iceberg. The economy with be more than cooled, it will go into recession. Other commens; Oil Sands royalty treatements; The report recommends increasing the net royalties after payout and introducing a severance tax which currently would be at 5% of gross revenues. It also recommends that the government share be based on a bitumen valuation that results in a deemed bitumen price of no less than 40% WTI. 70% of he Provinces bitumen needs to be extracted by means other than mining. The measures put forward would result in no new SAGD projects being proposed. These projects are characturized by high capital and operating costs combined with the potential of low price netbacks due to high diluent costs or differentials. Increasing the cost to the developer before payout coupled with not having the resource ower share in the downside price environment if differentials are high, makes the risk too great to attract new investment. This comes just at a time when the economic climate is such that there are finally new Canadian (Alberta) based entrants into this sector of the economy (MEG, NAOS, Deer Creek,. Athabasca Oil Sands, Laricina etc.) The measures proposed, I believe will shut down this sector leaving the resource primarily to the integrated internationals to develop. Additionally the report recommends a cap to the severance tax of 9% for WTI of $US120/bbl. This demondtrates that the panel did not test the robustness of their recommendaions At greater than 120$/bbl, input costs being unchanged, there is a great deal more economic rent available abd no need for a cap. I suspect that the downside of differentials and prices was also not tested or the recommendation would not have included a before payout severance tax. The report also recommends taking away many incentive programs in an effort to simplify the system. Although simplification is a laudable goal. The approach taken in the report demonstrates the lack of detailed examination of each element before making recommendations. Each of these programs was put in place in order to extract additional royalties from resources that would otherwise have been shut-in if nothing was put in place. Not to mention the economic benefit and job creation of the activities leading to development of schemes that take advantage of the progam. The Department of Energy does not enter into these programs without a great deal of analysis and a clear demonstration of benefit to the people of Alberta. They should not be dismissed out of hand which the report appears to do. In summary, I don't believe that the recommendations are clearly thought out, tested for robustness or will have the results or $1.9B in increased revenue the report predicts. My job in the oil patch as well as my children's well being depends on getting this right. Stelmach don't blow it. [Information Removed]
RRE3870 To whom it may concern, I currently work for a service company in the Alberta Oil Patch. I have a young family, a car payment, a mortgage and trying to create a small savings plan for retirement. By no means does this necessarily mean that I am "living high on the hog". The oilpatch in Alberta, in my opinion, drives the ecomomy. Previous to the gas price drop the three years prior saw oil and gas prices both at the high end of the peaks and vallys. That is not the norm and should not be seen by the government as budjet planning years. Canada is not the most economical place for Oil and Gas companies to do business because of wages, taxes, and many other reasons. The Drop of Gas prices has resulted in 10,000 jobs lost in the service sector of our business. Unlike Oil companies, that always have revenue coming in, the Service side only requires staff levels when the work is occuring. I urge you to please reconsider your adoption of the review boards recommendation. I fear that this could result in a huge down turn in the economy and closer to home, a lose of a career for many families in the service sector. Thank you
RRE3871 I am hoping that when the government looks at the royalty review it will take into consideration that the GAS business is different than the OIL business as the prices reflect. The review lumps them together for this percentage hike and that is unfair when talking about the GAS business. I hope government will be wise, fair & research thoroughly & SMARTLY with all the right current information. thank you
RRE3872 To adopt the Reveiw Panel's recommendations as presented would result in a devastating blow to Alberta's economy. Investment in this province's oil and gas industry (economically marginal in this current price and cost environment) will be significantly reduced. Any benefits the government hopes to see from increased royalty revenues will not materialize due to lower activity levels; good paying jobs (with high tax revenues) will be lost in the industry and throughout the service sector. I would not take warnings by companies like EnCana as being blackmail or bullying - it's a fact. All majors and many juniors have other assets outside of Alberta to develop. If the Alberta assets no longer meet corporate hurdles, budgets (investment) will shift to other areas. We as Albertans lose out! Our economy is booming and there truly is an "Alberta Advantage", don't kill it!
RRE3873 Hello : In the addendum to the data appendix, a formula for calculating the royalty rate of a low rate conventional oil well is provided: ADP<=3.5m3/d, rq%=((ADP-3.5)*.08)*100. This formula calculates the rq% rate for ADP <=3.5m3/d rq% as negative or zero. My reading of the report suggests that for a rate <=3.5m3/d, the royalty rate is 8%. Could you please tell me which is correct? thank you [Information Removed]
RRE3874 I am in support of the final report developed by the Royalty Review Panel. I would appreciate it if the Alberta Government would ensure that the current and future generations of Albertans benefit from the intensive development our province is undergoing.
RRE3875 This review is long overdue and the Royalties share has been out of whack and needed to be changed years ago. Albertians are not getting their fair share at all, and the oil industry is taking full advantage. They are using scare tacktics to control the outcome, and our government must not bow to that. The oil industry will not leave, cause any other province would be a little smarter and make sure they get there proper dues right from day one. If they want to take their marbles and go home well see ya. The money that is generated by our oil is enough so every Albertan should be getting a personal check at least once a year..it is ours.
RRE3876 Further to doing a lot of my own research on the royalty review subject, I have come to the conclusion that a 20% royalty hike would be detrimental to the Alberta economy. I am Alberta born and raised and in my mid-40's. I lived through the bust in the early-80's when I saw many families (including my own) have many negative experiences. We have a thriving economy and the quality of life is better than anywhere else in the country. Let's learn from the past and NOT do this again. I am a single-working parent [Information Removed]. If Alberta's economy suffers, then I will be out of work. The end results is that both of us will require financial assisstance from our provincial governement to survive. [Information Removed]
RRE3877 This raising royalty taxes is a real bad idea for all of Alberta. The oil and Gas sector has been hit hard enough already in the last two years because of inclemet weather conditions ex: Long rain periods.If royalties are increased Oil companies will slow activity down do not fool yourselves. Saskatchewan is a good example of this. Now the Sask government loosened royalties and oil and gas is now booming and thrivind in that province,along with the housing markets and economy in general. It's a no brainer, if nobody is making money, noone is going to spend money on anything. Ex: Furniture, cars, any big dollar items concurrintley affecting these sectors of business in Alberta as well. Please rethink this very hassardous idea. I(t will be a very bad thing for Alberta as a whole province, BAD,BAD, BAD. If this comes about my wife and I will surely be voting differently next election period that is forsure.You will be slitting the throats of thousands of hard working Albertans. Thanks alot!!!!!!!!!!!!!!! Yours Sincerley [Information Removed]
RRE3878 Tax the hect out of them. Oil & gass are a non renewable resource where are they gonna go. Just like they go and exploit other countries to make a dollar. We should exploit there nedd to dig and destroy the enviorment. If we can't have our health, we should all share the wealth.
RRE3879 Hi, my name is [Information Removed] and I work as a [Information Removed] for CP Rail in Calgary. I also volunteer as the [Information Removed] Condominium Corporation. [Information Removed] full time job and she tells me she's never been happier. She celebrated [Information Removed] . I am writing you, to express what I will do about the Alberta Royalty review. I will write a letter to the editors of the Calgary Herald and Edmonton Journal, in the next day or two, and ask for those interested in receiving compensation from the Alberta Government, for the depreciation in their land values, and their business losses, due to the implementation of the Alberta royalty review report , to count me in! I am not going to let this government destroy, in a year, what all of us built in twenty! [Information Removed]
RRE3880 Make the oil companies pay their fair share. Their profits and CEO salaries are obscene now. Implement as a minimum the recommended rates as presented by the royalty review report.
RRE3881 On behalf of myself and family I respectfully ask that the government accept all reccomendations of the royalty review. This government has not handled recent growth pressures and it is time to slow down and catch up. You are acting on behalf of ALbertans and have allowed us to loose Billions of dollars. No longer please.
RRE3882 The review board doesn't know what they are talking about. They need to get the real facts about doing business in Alberta. Op cost / land prices / cost to get services / What are production rates /well as compared to other sources, etc. Their is also pipeline tariff, trucking, sand disposal. Now the environmental costs are going through the roof. Why wasn't there a couple people from the oil industry on that committee?
RRE3883 It is clear to me that the Panel went into this with a clear agenda and were never able to wrap their heads around the multitude of issue that surrounds Alberta's energy industry. If the government accepts the recommendations there will be job losses in Alberta. Call it sabre rattling if you want but the impact is clear. Government is only going to get a bigger slice of a smaller pie. i recognize that some change may be required for political purposes but we are messing with a system that has worked for all Albertan's and not just the energy industry. We live in a Province that is debt free. Income taxes are consistently going down, and the Heritage Trust fund is growing. All of this has been done through the royalty income the province collects. Why are we messing with a formula that works? The biggest problem the Panel has created is uncertainty around the investment climate in Alberta. Investors will run if Alberta ends up being a location where the government makes retroactive changes to the rules after billions of dollars have been invested. I believe Wood MacKenzie compared the impact to of Chaves nationalizing the Oil industry in Venezuela. I am embarrassed to see my home going from being the pride of Canada, if not North Amereica, to being compared to a 3rd world country run by a socialist dictator. Thanks for nothing ED!
RRE3884 I am suprised that this panel has suggested such a large increase in a royalty that has been fine for years. Has this never been reviewed in the past? I can understand an increase based on inflation or cost of living but these changes are huge. Why would this royalty review report suggest a government ignore honoring signed agreements on royalties with major companies trying to complete major projects. I am dissapointed in these results and hope the government sees past the catchy slogan "our fair share" and looks at these unreasonable additional taxes on an industry Alberta relies on for its "Alberta Advantage".
RRE3885 I apprecaite the premiers level headed aproach to this and only hope that the government is not bullied by the oil compaines. It is about time we get a more equitible share of our own provinces resources, while it lasts.
RRE3886 We appointed a board of experts to review the situation and the people on the board such as Dr. Plourde know far more than I and 99% of the population which is why we asked them their opinon on the matter. People cannot call the suggstions into question unless people with matching credentials are the ones questioning them. The only thing left for the politicians to hash out is weather that efficient outcome is equitable across the various interests groups and present and future generations. And that is the only thing Joe Albertan is qualified to comment on is "do you think that this is fair" not "do you think it is the right thing to do", experts have already told us it is.
RRE3887 The Royalty Review Panel membership reflected a good cross section of distinguished and qualified Albertans who spent months investigating the issue. I think the recommendations MUST be accepted AND implemented as-is in their entirety. Any 'compromise' with the oll and gas companies will be seen as backing down in the face of the oil company resistance - and will be seen as a continuation of the policies of the current Alberta Gov't that has resulted in the current state of affairs. Although we really should attempt to try to recover years of under collection of revenues - I accept that this is probabily impractical. Any backdown will be seen my myself and many Albertans I've been talking to as further evidence that the present provincial gov't is incapable of siding with the citizens of Alberta over the interests of the oilpatch.
RRE3888 I strongly feel that the government and many Albertans don't choose to understand what a drastic impact the increase in Royalties will have not just on the Oil & Gas companies but Albert as a whole. The Oil & Gas companies are always looked at as the "money hungry companies making the big bucks" instead of looking at them as the bread and butter that has made this province what it is. Don't you realize the ripple effect this will have on so many other industries. You bring these companies to their knees you produce unemployment, loss in retail sales, Real Estate drops not to mention all the other service industries that are booming because our province is fortunate enough to have natural resources. Don't let greed and ignorance drive you to a decision that can cripple our province; instead take a good hard and accurate look at what these Oil & Gas companies have contributed to this wonderful province.
RRE3889 ----- Original Message ----- From: [Information Removed] To: Ed Stelmach ; Lyle Oberg ; Rob Renner ; Leonard Mitzel Sent: Thursday, September 27, 2007 8:42 AM Subject: Oil Royalties Premier Mr. Ed Stelmach Oil Minister Mr. Lyle Oberg MLA Mr. Leonard Mitzel MLA Mr. Rob Renner I am an Albertan with a couple of businesses that deal directly with the oil industry with approx 55 employees. [Information Removed] We are currently experiencing a fairly severe down turn in our industry. I have been hearing from several Oil companies (customers) that if your proposed royalty change goes through as proposed they will be cancelling even more wells etc. We do not need a further slow down at this time, the trickle down effect from our current slow down has not fully reached all Albertans, but it will. Any further slow down will put our industry and I believe our province in a recession. I agree we need to redo the current royalty structure, but need to do it carefully and slowly as to not deepen our current slow down. Respectfully [Information Removed]
RRE3890 Yes,I am very much in favour of increasing the royalties,its only fair to Albertons
RRE3891 I wish we had a Government that stepped up for Albertans and and not big Oil Companies. I don't for one minute believe the Oil Companies when they say they will pull out of Alberta, even with an increase in royalities they are still onto a very good thing here. Even if they did pull out it wouldn't be the "end of the World". I believe that things need to slow down so we can catch up to all the people who have arrived "en masse" in our Province and everything that encompasses. I think the Oil Companies should be ashamed of themselves especially Encana the first one to turn on us and one of our own. I believe in playing fair and the Oil Companies aren't playing fair at all they are just plain greedy. It's time we sent them a message and looked after Albertans and Alberta for future generations. Their greed should not be rewarded. Thank you.
RRE3892 I have read over the report thoroughly, and as a new Albertan I see a need for change. I am happy to have moved here from Nova Scotia to take advantage of the great [Information Removed] program at the University of Calgary. I would like to see the government agree in principle to the majority of the report. It is time for the people of Alberta to get their fair share of from the oil and natural gas companies. When looking at the comparisons to other jurisdictions the increased royalties would still leave Alberta in a favorable condition. Posturing from big oil and gas is not worth fretting over. Companies that are threatening to pull out or scale back their operations are just raising a stick that they will not utilize. The truth is that they need the resources and Alberta is a safe place to invest. If operations are scaled back the resources will not go away they will still be there for the future. A slowdown in this boom would not hurt anyhow, even if it is temporary. I urge the government to raise the royalty rates and to put some money into infrastructure and into savings for the future.
RRE3893 I have worked in the Oil patchg for 30 years. These Oil companys have been making record profits for 5 years. Now they have reduced the work because (what they say is price gouging) but what amounts of gas prices. Conventional oil is not the isssue. Gas is. I think they should go ahead with the increase. The oil patch is dead away. Alberta deserves more.
RRE3894 Steddy Ed your messing with my job ! PC WAS WITH THE KING. DONT MESS WITH MY VOTE OR OTHERS PATCH WORKERS
RRE3895 I think that the report should be adopted in full. The conservative gov't has basically beem cheating the public, misleading, and directing money to cronies, the corporate elite and insiders. This hinges on criminal theft of resources that the Alberta public owns. Combined with bill 46 it amounts to totalitarian repression of the people and their input into gov't, that resembles anything the KGB would have dreamt up in the old Russia. [Information Removed]
RRE3896 The report is clear. We are giving away a non-renewable resource for a song. For me, the government response to the report will be a deciding factor on voting day. Accept the recommendations. Industry will still make a huge profit.
RRE3897 To the Alberta Government (who has been put in their seat by us, the people, and should listen to us on this issue), I appreciate the effort and concern you have shown by having this review into the royalty taxes paid by the producers in Alberta. However, the way I see it, you are trying to rob Peter to pay Paul. You state that the oil industry hasn't propersly compensated us, the owners of the resources, and would like to hike the tax by the sum of $2B or so. May I point out that the oil companies have put up all the risk in exploring and developing the oil & gas industry in Alberta for the last 100 years or so. No tax payer has carryed the burden of this risk, but surely has reaped the benefits through the employment opportunities, economical feedback of money in Alberta by the oil industry and gains in the ownership of shares into any company associated with the oil and gas industry. My opinion is that the oil idustry pays the going rate (market value) of the open market (capitalist economy in Alberta) for the land acquisition and the possibility to dril and exploit such land. They do this by analyzing the costs and revenues they can make on each project. Because of the capitalistic nature of the business, they will always give the needed rate of returns to their investors. Land acquisition costs and taxes are on the same column of costs in their balance sheets. If you hike the royalty tax by $2B, there will be a direct and proportional decrease in land sales at the other; net to Albertans will be $0B (that is still with a B for Billion, but zero is zero). The only thing that raising royalties will do, is scare away people from marginal plays (whcih covers most of Alberta) and decrease the economical activity in this province. I bet that BC and Saskatchewan are just licking their chops to get all this Alberta money and people to go exploit their resources. We have already seen a big exodus to Saskatoon from Albertans tired of the high taxes and low services (health, schools, roads) in this province. I say, don't mess with what is not broken, and greed will only be the end of it all, if you want to send us back to the 1980's and that federal fiasco called the NEP. Sincerely, [Information Removed]
RRE3898 It seems the oil industry might be amenable to a sliding scale on royalty.The money collected could go directly to infastructure and some moneys to help on research.Research to purify water used in the oilsands.Make those priorities
RRE3899 The royalty review panels recommendations, if accepted in full, will cause complete devastation of our economy. A reduction in oil and gas spending woule be the immediate and disastrous result. Jobs will be lost. The housing market would see the bottom fall out, with little demand for new housing thousands and thousands of homeowners would see the value of their recently purchased or built homes drop below what they paid for them. Consumer spending will decrease, less taxes will be paid. In short this is the worst idea since [Information Removed]destroyed our economy with the NEP. I work in the oil and gas industry (as do 1 in 6 people in Alberta) and I want to know that I'll still have a job next year, so I can feed, house and clothe my family. The royalty review panels recomendations are based on flawed and outright incorrect data. Most egregious is the fact that they deigned not to include bonus payments in the calculations as it was "too difficult". The 3.5 billion paid to the province in terms of bonus payments is far above the 2 billion the royalty panel claims would be raised by their proposed increase. An increase that would be negated by massive cuts to exploration expenditures on an unprecedented scale. Accepting the panels recomendations will not just "cool" our economy, it will kill it.
RRE3900 To the Energy Minister and Premier My husband [Information Removed] and I live at Indus Alberta. [Information Removed] works for Telus and I am the [Information Removed] at Compton Petroleum Corporation. Our livelyhood and retirement will be very much dependant on the decisions that you and your government make over the next few weeks. We are very concerned that the government will feel pressured by special interest groups to make a quick and poorly advised decision. Please take the time that is required to do a full analysis of the situation before making any decision. We support the review and agree that Albertans should get their fair share but changes need to be well thought out and all factors need to be considered before change is implemented otherwise we significantly risk the current prosperity that all Albertans enjoy. Rash, knee jerk decisions always result in poor solutions. [Information Removed]
RRE3901 I am very concerned about the effects that this will have on our economy. There are many "side" businesses that support the oil industry that will be drastically effected if the 20% is implemented. Please use caution when implementing a new program. A 20% increase in any tax seems a little extreme to me. Thank you [Information Removed]
RRE3902 I think that we should look at what other countries are doing. I believe that Norway has a very successful royalties program, and we should have a similar system. I think Alberta's royalties have been too low for too long. I am proud of our premier for asking these questions, and he would do well to stand up to big oil companies.
RRE3903 I am very dispointed with the recent inquiries into royalty rates. How can this govenment say Albertans do not get their fair share? This province runs multi-billion dollar surpluses an generates an extreme amout of revenue of the backs of the oil and gas companies. I find it confusing why the govenment of Alberta wants to squeeze oil and gas producers to a point of minimal profits. The industry is already reeling from low commodity prices, increased service costs and income trust rule changes. We are seeing gas producers walk away from this province and service companies laying employees off by the hundreds. If royalty rates are raised I belive the industry will completely crash. People have migrated to this province by the thousands to work in the oilpatch and get rich. What will taxing the only industry that supports this province do? The oil companies will stop spending money, we will loose our jobs then our houses while the government collects higher royalty revenues. Is this in the best intrest of Albertan's? NO. Taxation does not create industy or wealth. It kills economies. Taxation does not ensure that Albertans get their fair share, it takes money out of the peoples hands and puts it into the politicians pockets. Make the smart choice, promote growth in the oil and gas industry by reducing royalties. Doesn't the govenment have enough of our money?
RRE3904 I think their should be an increase in the royalty rate. The people of Alberta should not have to wait till the oil companies have paid their costs. They will only control their costs if the costs come out of their profits not ours.
RRE3905 Not too impressed with the Panel or their recommendations. Slowing down the growth in the oil sands by increasing royalties is okay for new players but it is not acceptable to change the rules for those companies who took a risk and invested in the oil sands when oil was $30/barrel. Having said that - if these "grandfathered" companies are bought out then the new royalty structure should apply.
RRE3906 For a majority of Albertans, the energy boom in Alberta as caused nothing but higher energy prices, sky-rocketing construction cost, inflated real estate prices, young families with huge 20-30 year mortgages, housing shortages, labor shortages, over taxed infrastructure, roads and facilities. The energy companies have been raking in huge profits at the publics expense it seems. Now that a energy royalty adjustment is recommend, all of a sudden these same energy companies are saying their losing money, what a bunch of rubbish. They threaten to put a hold on future expansion, so what. We do not need any more expansion, it will only make things worse for the average Albertan. Why are we so determined to empty all the energy reserves in Alberta as quickly as possible? This kind of mentality will not serve the interest of Albertans or Canadians in the long run but only increase corporate profits. These companies are not going to pull up stakes with oil over $80.0 a barrel. Where are they going to go, Iran? Lets take a good hard look at getting a fair return on our energy reserves and also start developing a more sustainable approach to future develoments. Albertan's are tired of the boom and bust mentality of the oil patch.
RRE3907 Its about time. If companies are going to complain about the cost of investment and uncontrollable fixed costs then let them leave. They are committed to the investment and could not receive support from stockholders in their companies or boards of directors to leave the projects. Don't fall into the trap though - use the money to make the necessary infrastructure improvements to support continued and sustainable growth. Expand the wind and solar farms in southern alberta, seriously commit to the bullet train idea (Calgary to Edmonton to Fort MacMurray or Grande Prairie). Alberta needs to be a leader not a follower - we can lead the charge on infrastructure development and social improvements for housing and continue to have growth supported by infrastructure development. We don't want to end up like Ontario with a industry base that is stagnant and generating losses.
RRE3908 My best advice is "Don't Blink". Business is business, and the oil patch is much better armed than the Government to undertake fear mongering. It is also foreign controlled and no doubt influenced by a US desire for secure supplies close to home. I suspect that this issue is a LOT bigger than just the royalties. When the conventional oil and gas are all gone, we'll wonder why we didn't charge more for it. There is NO reason to give it away. For example, contrast the trust fund in Alaska to the one here. If we had over $100 Billion in the bank, we could run the province on the interest. I think that should be a real goal over the next two decades - to create an annuity from the non-renewable resources to sustain outr status when they're gone. We could also build safe pipelines and be in the toll business over the very long term to move reserves from the far north to the markets. I'd implement the recommendations (or more!) and put the difference in a bank account ( a sub ledger of the Heritage Fund). Tell the Industry some of it is for them and they can earn it through innovation - i.e. figuring out better means of extracting tar sands than using up all the water and natural gas. The rest is for Albertan's future. Yes, a few of them may reduce spending, or even leave. There is anough entrepreneurial spirit in Alberta that any gap will be filled. I don't frankly care if a few foreign-owned mega corps bail out - let them work under armed guards in Venezuela - see what that does to their costs. I would be trying to create as much value-added product here as possible - why ship raw bitumen and crude and let somebody else make money off our cheap raw stocks? Better to have Alberta Citizens in charge as they will actually care about the waste being left behind. Part of our innovation fund could be to work with Sask to develop very clean nuclear power. This will be critical for Sask to extract their Bitumen, which I believe lies progressively deeper down than ours as you move east. All in all, don't blink! [Information Removed]
RRE3909 I have worked in the oil and gas industry for over twenty years, most of those years with two major oil and gas companies. The mandate of those companies is to provide the best returns for their shareholders. They don't have any interest in the future of the young people in Alberta. Please increase the royalties so there's something left for future generations.
RRE3910 Mr. Stelmach, I work for a progressive energy company and my owners have made it very clear that my job is on the line if this increase in royalties proceed. I want to work, I don't want the government upsetting the apple cart. The trickle effect will be astronomic and our Canadian companies will be ripe for the picking off by foreign investors, "the chinese" in particular. I picture them rubbing their hands together, saying O Goodie! Bring it on. You've opened a can of worms that I'm sure you never envisioned possible that could lead the Alberta economy to the verge of collapse. I urge you, do not proceed. STOP NOW. Strategise! Hire your best legal advise on how to get out of this mess and listen to them. Yours Truly: A Most concerned Alberta born and raised and proudly working Rural Mother in the Oil Patch, [Information Removed]
RRE3911 Raise the rates. Foreign workers are being brought in, large parts of plants are being made in Asia and floated on a slow boat to get here and raw bitumen will be shipped south to be refined. If oilsands development slows down, great. That is NOT lost revenue, it is deferred revenue.
RRE3912 This might be the most important time in Alberta's history (besides the National Energy Program). Jobs are more important then extra revenue coming in to the government. I have never sent an e-mail to the govt or an mla before however your decesion will impact my job and my family's financial secuirty. Be very careful what you do. I would suggest you work closer with the Oil companies to implement changes where they are required. The survey's that we here in the paper do not tell a true picture of how people feel as most people (including me) do not have all of the facts. Talking to people in the Oil industry (Calgary and service industries outside calgary) people are very concerned to the point of being scared. We somthing impacts peoples jobs thats what happens. [Information Removed]
RRE3913 With over 20 years in the oil patch I am extremely dissapointed that the Alberta Tories are contemplating a royalty change. Personally, I live in the City of Red Deer and economically things have changed over the past 12 months. Drilling and servicing contracts and rates have plunged and there is a real negative view about both the economy and the Alberta Tories royalty plans. Should the gov't proceed with a change to the royalty scheme you will have lost my vote at the next election.
RRE3914 I wish to express my concern about the Alberta Royalty Review. As an Albertan and a taxpayer, I hope that Albertans are receiving their “fair share” of royalties. However, I also work in the oil and gas industry and I can appreciate the challenges that oil and gas companies face. My livelihood and that of countless other Albertans is tied to the oil and gas industry. All I have to do is think back to the days of the NEP to remember how government policy can adversely affect our industry and therefore, the lives of not only those employed in the industry, but everyone in Alberta. All I ask is that the government consult with industry and think this through carefully to ensure that the royalty regime is balanced so not only Albertans receive their “fair share” but also so oil and gas companies continue to prosper. If we get this wrong, too many Albertans are going to suffer the consequences.
RRE3915 I'd suggest the Alberta government host a public debate between the Royalty Review Panel and the Oil and Gas industry. In the debate, Albertans will have a chance to really understand the impact of increasing Royalty percentage instead of a hollow "Our Fare Share" which is very misleading. [Information Removed]
RRE3916 The threats of job loss should not deter the government from enacting a more fair payment structure from the oil and gas companies. It is their big rigs and increased road use that wears down Alberta’s roadways and in some cases directly due to the overuse by their vehicles substantial decrease in the ability of the government to maintain the roads in a proper manner. I believe that they not only should have to contribute more, but I also believe the government should be taking a much harder stance on their abuse of our resources, such as the roadways, water use, and the pollutants they continue to dump. These all have to be cleaned up and why should the average Albertan bear the cost of this, while these companies continue to see profits in the billions. Threats of decreased campaign contributions or threats of job loss equate to nothing more than a "bully" mentality and should not be tollerated or bowed to by our government which is supposed to speak for us.
RRE3917 We have been such a giving Province and it's time that the Oil Companies gave back to us. We should be entitled to having a better health care system and education system without giving our resources to mainly US companies. For the executives to cry about their profits is a shame, since when does the Premier of our Province get a million dollar bonus, or what about our doctors who give so much with little gratitude. Please do not give what is owed to the citizens of Alberta to high-flying executives.
RRE3918 I have zero faith that the Alberta government gives a tinker's damn about the interests of citizens when weighed against the interests of big business or right-wing ideology. In the absurdly unlikely event that the AB Government actually decides to act in the interests of its citizens, I would like to see the extra revenue split 3 ways: 1/3 to the Heritage Fund (or better yet, something more closely resembling Alaska's or Norway's savings funds), 1/3 to education - both primary and advanced, and 1/3 to AB's crumbling infrastructure. But, who are we kidding? The government will act according to the wishes of its big-business owners. Ain't democracy grand?
RRE3919 The recommendations in OUR FAIR SHARE are well reasoned and appropriate. Please implement them quickly, and allow all concerned plan based on this fair and reasonable new strategy for review report. On behalf of my family and children, and future generations of Alberta, thank you in advance.
RRE3920 I have heard a number of phrases that have been used in various commentaries on the Royalty Reveiw Report, including: 'get it right', 'don't kill the golden goose', and 'backbone of the economy', in relation to the oil and gas business in the province. Each has its applicability and resonance with the general public. The mesage that I would like to convey to the Government of Alberta on this issue is much the same as the caution that accompanies the phrases noted above. To wholeheartedly accept the Royalty Review Panel's recommendations 'as is' will much more likely do an incredible dis-service to the people of Alberta than the potential intended benefit. The reason for this is that the Report is based on flawed and dated data, and was focused on only one consideration - government take. In relation to a dynamic investment decision-making industry, assuming no change to industry activity levels, is, repeatedly, flawed. That there was no consideration given to potentially serious negative impacts based on their recommendations is either an incredible oversight or incredibly naive. To collectively bury their heads in the sand in this regard, the Panel has failed to recognize the global nature of investment decision-making in general, the tip of which has started to surface in recent days with announcements by companies like Encana and Talisman. Do not brush these off as a bluff or grandstanding. The Panel has apparently failed to consider potential effects and side effects. Regarding employment, whether direct in industry, or in related businesses as well, is the number 2000 or 100,000 potential affected jobs? I don't know the answer, but I sure hope the Alberta government does before making a decision on this. Similarly, what if you upset the egg cart to the extent that $10,000 or $100,000 is trimmed from the value of every residence in the province? Unlike the Federal Government's decision to change the rules regarding royalty trusts which shaved $35 billion off of the savings of ordinary people across the country over night, your decision could reduce the wealth IN THIS PROVINCE by $10 billion? $100 billion? equally as quickly. Again, I don't know what the numbers are, but you as the Government of Alberta better have an idea, to weigh the risks against a potential, but unlikely, outcome of an annual revenue increase of about $2 billion. These are only two obvious examples. Relative to ALL other jurisdictions in North America, we in Alberta are currently in the enviable position of having the lowest unemployment, no debt, and sizeable annual budget surpluses in a robust economy. Please be sure you FULLY understand what problem it is you are trying to solve - do not be penny-wise and pound-foolish. Regarding your current deliberations on the Royalty Review Panel's recommendations, please use the facts to MAKE A FULLY INFORMED DECISION and GET IT RIGHT.
RRE3921 The proposed royaly changes will aggravate an already deteriorating oil and gas activity climate in Alberta. The deteriorating climate has resulted from skyrocketting costs, diminishing size of potential pools and the appreciation of the Canadian dollar. Few if any of the academically oriented review panel have practical experience in the oil and ags industry or any apparent appreciation of risk. The Alberta advantage has been its stable political and competitive fiscal structure despite being about the most expensive place in the world to find and produce oil (especially the tar sands). After companies have invested billions in oil sands leases and project capital based on economic models reflecting the present royalty rates you are deciding to move the goal posts! I never thought I would see the day Alberta created its own version of the disasterous National Energy Program. The damage inflicted by that illconceived program took many years to recover from. Think carefully.
RRE3922 I am a professional engineer with 27 years experience in the evaluation and production of oil and gas. For the last 15 years I have worked as a reservoir engineer, focused on properties in western Canada but often involved in international projects. I have observed that the oil and gas properties in western Canada are generally more mature than those in most other producing regions in the world (perhaps with the exception of the lower 48 onshore United States). When a region is mature it can be characterized as having more rapid decline of oil and gas production rates in a given well. As regions mature there typcially are fewer reserves captured with each new well than had been the case decades before. The remaining pressure in active pools is frequently very low: many gas pools operate at just above atmospheric pressure. Another indication that the industry in Western Canada is mature is the increasing proportion of unconventional production: from tight gas, from coal beds and from heavy oil. The economic implication of producing in mature basins is that the capital and operating costs per unit of production are greater than in less mature regions. In oil and gas theatres where the average well produces over 1000 boe/d the government can reasonable levy higher royaltyies than in mature areas where the average well produces 10 boe/d or less... I believe that the biggest bust in the current royalty structure is the treatment of oilsands projects. I have observed that [Information Removed] for one has attempted to roll capital costs for expansions into their royalty calculations, to prolong the payment of minimal royalties. I think the Alberta government should clamp down on this type of royalty avoidance. Expansion capital should not be rolled in to defer royalty payment from an oilsands project. Expansion capital should only be applied to royalties payable on the incremental production resulting from the expansion.
RRE3923 Artcile published in the National Post: Michael J. Tims on Alberta's Royalty Review: Where you stand depends on where you sit. My late mother never professed to know much about business or economics, but she knew something about human nature when she used to repeat an old quote to me: “Where you stand depends on where you sit”. Simply put, she meant that how each of us feels about many issues in life is very much a function of our experiences, our occupations, our values, our upbringing and other factors. Those who are taken aback by the current vociferous debate in Alberta, a place heretofore considered a veritable paradise on many counts, can see that at least a “fair share” of the current strong feelings, on both sides, very much arises from where people sit. One would have to be living in a cave more remote than Bin Laden’s to have missed the fact that there is strong disagreement over the data used in the recent report of the Alberta Royalty Review Panel. Clearly, differing assumptions of capital costs, operating costs, and actual returns being earned will lead to widely varying conclusions about what is “fair” or “equitable”. In addition, oil and gas companies, investors and knowledgeable analysts have spoken out to forecast the consequences of different courses of government policy action. Rather than repeat those points, however, let’s try to take the discussion up a level. The oil and gas industry was shocked to learn, from the opinion polls and some of the public comment, that a fairly large percentage of the Alberta population doesn’t particularly like it, and feels that it should pay more into public coffers. The oil and gas industry had previously assumed that it was self-evident to everyone that this industry was and is a very important driver of many of the things that people love about Alberta: a budget surplus; the public debt paid off; low income taxes; no sales taxes; very low unemployment rates; a Heritage Fund; strong contributions to charitable, educational and community organizations; and numerous other benefits. The provincial budget arithmetic, where close to $1 of revenue out of every $3 comes from non-renewable resources, before considering corporate and personal taxes arising directly or indirectly from the energy sector, further underlines the reasons why the oil and gas industry could have had the impression that its role was both clear and appreciated. As a result, it is completely explainable why the oil and gas industry has reacted to the new royalty proposals, and to some of the criticisms leveled at it, similarly to Julius Caesar, upon seeing Brutus and others pulling knives from under their cloaks; or to the Revolutionary Army, when it learned of Benedict Arnold’s plot to go over to the British side. The reason for this reaction is simple: Those in the oil and gas industry, and those who actually see that they rely on it for their livelihoods, see positives from oil and gas activity that vastly outweigh any negatives. What has become clear is that not everyone feels that way. I sometimes refer to those whose livelihoods are very linked to the oil and gas industry as being “indexed to the boom”. This group includes many engineers, oilfield services people, lawyers, accountants, building contractors, investment people and others. Yet for those outside the “indexed group”, which could include teachers, health care professionals, public servants, those in agriculture and those in technology, among others -- disadvantages may weigh more heavily on their minds. Strong economic growth brings with it higher housing prices, higher restaurant costs, more expensive office space, higher salary and wage costs, a shortage of parking, other pressures on personal lifestyles, and various other intrusions---- as oil and gas wells are drilled, large projects are pursued and downtown office buildings are built. The hard part for the Alberta government on this point is that there is no right or wrong answer to what people think and feel. In addition, care must be taken, in a political realm, to not allow anyone to attempt to exploit different visions and perceptions to create needless divisions. In a world with no easy answers, I would encourage Alberta’s government to build a base for a policy decision in three ways: --- First, look to what markets can tell you. It is fact, rather than opinion, that the Canadian oil and gas sector has generated lower investment returns than its U.S. and global counterparts over the past five years, suggesting that returns in this sector were already better elsewhere. It is also fact, rather than opinion, that drilling activity in western Canada was already down by 30% in 2007, and that only 338 of more than 800 available rigs are being used at present. All of these indicators suggest that the market thinks that “excess returns” in Alberta are quite hard to find, even before any new measures are implemented. --- Second, review the basic concepts of game theory and decision sciences. In particular, focus on the notion that the return that might look to be acceptable after an outcome is known may be very different than the potential payoff that is required before a risk, with unknown potential problems, is ever taken in the first place. --- Last, listen for the voices of reason and for those who at least recognize that there is more than one point of view. Somewhere, in all of this, lies a solution that will keep Alberta the terrific place that it has been; and that we all wish it to remain. Michael J. Tims was born in Calgary and is a fourth generation Albertan. Mr. Tims is Chairman of the investment firm, Peters & Co. Limited, and he is deeply involved with a number of not-for-profit organizations, including the United Way.
RRE3924 Ed, Im from Smoky lake, a small town like yours, did any one think of all the little kids out there in regards to this, 90 % of the men and women i know are somewhat related to oil and gas, what will happen to this generation if they cant be fed, does our government want to be responsible for this, how come money is more important than keeping alberta going, why cant a slight raise in royaltys be implemented versus a big hike, if this happens i know for a fact that oil companies will come to a stop, what will be the outcome when we start to see foreclosures and unemployement rates rising, do we want people to move to sask,bc and ontario, we cant have this, most farmers i know cant make it farming and now work winters in the oilfield to make ends meet, what will happen to them if there is no second income, I would really appreciate this to be thought of really hard and give Alberta a chance, oil companies will not care of the youngans but government should, keep this going the way they are with only slight changes please. Thank you to all who read this and may share my thoughts,once again thanks.
RRE3925 Alberta can not afford to damage its reputation as a safe and reliable souce of oil and gas production. Every Albertan benefits tremendously from the success of the inudustry, investment and continued stability. The Province has an obligation to ensure that this continues and must be selevtive with the recommendations that it adopts. The Province must respect the contractual obligations that are in place with existing Oil Sands projects.
RRE3926 Sir/Madam, I would like to communicate my thoughts about the Royalty Review as presented this week. I work in the oil and gas industry, and because my household's livelihood depends on the viability of the industry, I am concerned with the findings of the report. But not for the reasons you might think. I have been talking with quite a few people who are in investment community with a number of oil and gas companies in Calgary. There was the belief from some of the analysts that things would change, but not materially. I am now hearing that analysts are calling the oil and gas companies, and asking what happened. We employ some incredibly smart people in the oilpatch, and it is troublesome that the communication broke down so fundamentally that the INTERNATIONAL investment community is now concerned about the stability of the government of our province. It is in the IR folks' best interest to communicate the truth up front, to allow the market to adjust immediately in a small way, rather than be blind-sided with an announcement such as this. My concern is that the industry reps walked away from those hearings with the impression that there would be some changes, but only marginal ones. So the concern is that the representatives on the government side did not accurately reflect to those industry reps what they were actually thinking. This is problematic not only Albertans, but Canadians as the TSX is incredibly tied to industry. The impact of this decision will not only affect Alberta, but it will affect anyone invested in TSX-listed companies. Secondly, and this is a wee bit of an economics rant, but I would suggest that the multiplier from direct investment and its spin-off effects would be much, much higher than a form of corporate taxation and transfer payment. I am not knowledgeable enough to understand the magnitude of the multipliers for both of these ideas, but I have to think that the purchase of TV's, cars, houses, trips, etc. would all have greater positive effects on the Alberta and Canadian economies than would any transfer payment. Call me Keynsian. My final concern is with the method by which this decision was conducted. I would suggest that rather than have a bunch of meetings to discuss the impacts of a royalty regime change, and then have another set of meetings with basically the same stakeholders you met with originally after the release of the report, it would make sense to have only one set of meetings, and arrive at a decision and move forward. This speaks to the inefficiency of government, and how that inefficiency extrapolates into managing extra money on behalf of the public. This only needed to be done once, and if it is done thoughtfully, the result will make everyone happy, and will make nobody happy. [Information Removed]. Selfishly speaking, I am not concerned over the outcome of this review. My wife and I are both in positions that will likely not be affected either way, and if something does go wrong, we have no problem taking our skills elsewhere in the world. This is your biggest problem. We have a great deal of demonstrated mobile workers. They will leave as quickly as they came, and that is how Alberta will suffer most.
RRE3927 Our company is planning on laying off 1000's of people according to last weeks meeting on [Information Removed]. I would rather see a slight increase in royalties. This will increase Alberta's surplus and also allow more people to work and less people to be on social programs...
RRE3928 Siesmic has always been high risk, and requires thinking on your feet. It is unfortunate, this industry is, and since its' inception, been top centered. We still have to see compensation plans (not WCB), pension and health for the guys in the field. Obviously, [Information Removed], [Information Removed](despite the rate of $650 per day). Maybe, it is time for a shakeup. The review does allow for fair and accepted accounting principles, I feel it is a flexible approach not, draconian. Your thoughts? Have a great day. ----- Original Message ----- From: [Information Removed] To: [Information Removed] Sent: Thursday, September 27, 2007 11:26 AM Subject: [[Information Removed]] message from one Oil Company on the Royalty Review FYI, I am the manager of geophysics at XXXXXXXXX. Our team just canceled a 3D because of the uncertainty out there. No matter what ends up happening, there will be a reduction in activity this season directly related to the situation. Sorry. I have to answer to my shareholders and its not prudent to be spending high risk capital at the moment. <>Acquisition of seismic is always the bleeding edge of the oil and gas sector. Exploration in Alberta will drop drastically, given the changes contemplated in the royalty review document. Just giving you the heads up, XXXXXXXX Manager of Geophysics -------------------------------------------------------------------------------- _______________________________________________ [Information Removed]
RRE3929 It will be just like in the 80's Last guy to leave the Province please turn out the lights.
RRE3930 I think we as citizens of this province should receive rebates\[checks or no provincial tax on gas etc.] It is our resoure you say but unlike Alaska where they get checks in the mail.. we get nothing.. Ripped of again by the gov't and big business. [Information Removed]
RRE3931 I am very concerned that the Royalty Panel has not based their conclusions on correct data. I sincerely hope that all information will be reviewed and that the oil industry will be heard. ALL Albertans will be affected and I know the general public is not aware of all issues. The oil industry has driven all aspects of our economy - housing, restaurants, vehicle leasing, dental plans, hotels, etc. Please consider how much you want our economy to "slow down". I'm sure all implications of the recommended Royalty Review are not understood in this report.
RRE3932 I understand that this review is supposedly good for all Albertans. What kind of percentage is the Premier - himself and all the MLA's going to put in their personal pockets? What raises and additional personal royalties are they going to receive? I am a concerned citizen of a small town. I would like to see a community pool be installed to help the younger people of our community enjoy benefits - is the provincial government going to give additional money to our community to build this pool? What about the ripple effect of the government taking what is believed to be 50%, not 20%. If you do not receive the existing payout from the oil & gas companies now, how is that going to affect people like me? My wages are going to go down, and therefore, I will have to sell my home, and move back to Ontario for example, because I am not going to be able to pay the high cost of living here in Alberta without the higher wage. If I have to move back to Ontario, there are many others who will do the same. Therefore, the government and communities will lose additional income from our taxes and other monies that we spend to keep the economy going in this province. I don't think enough thought and consideration has gone into this "review". I think the government should actually listen to the people of this province for a change instead of looking at just the numbers of what looks like a good idea.
RRE3933 I think that the government should represent the interest of the people of Alberta, not the forgein investment. Yes the two are closely linked but very distinct. Based on the information that I have read, I believe that the government of Alberta should implement the recommendations of the report. The resource belongs to Albertains / Canadians. There will always be a need for oil and gas in our economy. What's the rush in getting it out of the ground so fast and giving it away? Speeking from a concerned Albertan Thank you for the opportunity to provide a comment
RRE3934 Dear Mr Premier and Members of the Legislative Assembly, I am severly dismayed at the findings of the Royalty Review Report and cannot fathom for even a minute that the Government of Alberta would sell out the oil industry for politically expedient reasons. I am also extremely concerned at the general public's apetite to take on so called "Big Oil" as if somehow "Big Oil" was one or two people. In fact, Big Oil is the centerpiece of both our Provincial and National Economies and we all saw in 1981 the results of Government Intervention into the Oil and Gas Sector of the Economy. I find it equally stunning that a Review Panel, predominantly stacked with economists, would not be able to see the impact of Government Intervention into this vibrant sector of our Economy. (As an aside, how come there was not any oil and gas producers on the panel?) In fact, "Big Oil" is comprised of thousands of shareholders who have staked their future on a profitable and vibrant Oil Industry. These shareholders coincidentally are also the electorate, and they will severely punish in the next election any government who is seen to be meddling in their future and future wealth. As a 48 year old native Albertan, who has never voted anything but Progressive Conservative in any election, I am personally warning you that should the recommendations of this panel be accepted, that I will never vote for the Provincial Conservatives again. This is not to say that there is not room for improvement within the Royalty Structure as it exists within the Oil Sands. I am not infomed enough to say for sure. What I do know is on the heels of the damaging announcment regarding the Energy Trusts, the current low price of natural gas, the ever increasing costs of regulatory compliance, the high costs and shortages of skilled labor, the last thing that the conventional oil and gas sector needs is another cash grab from a Government that already has more money (thanks to the oil and gas industry) than it could possibly spend. And what would you use the money for anyway? More Hospitals? Elimination of Health Care Premiums? Elimination of income tax? I think not. I would wager to say that sucking another 2 billion dollars from the energy sector will not one change one thing for the average hard working Albertan. Yes, Alberta wants a fair shake. Alberta wants their fair share! Well, Albertans can have as big a share as they want, because a larger percentage of a much smaller pie will not do anything for anybody. So please, Mr Premier and Members of the Legislative Assembly, please carefully consider the ramifications of punishing government policies on the Oil and Gas Industry. Short term political gain should not be your motivation. The stakes are way to high!!!!!!!!!!! [Information Removed], a concerned Albertan.
RRE3935 I believe the proposed changes to the Royalty Regime are like cutting off your nose to spite your face. AB is a "have" province because ,yes, we have the oil and gas, but we also have the people, knowledge and expertise to discover, research, risk investment and produce the natural resources we do have. And that don't come cheap! Making a money grab with the excuse the average Albertan wants his fair share is condescending. The average Albertan has a high standard of living, low unemployment ,and no gov't debt largely due to revenues generated by the petroleum industry. The proposed changes will affect the gov'ts income by decreasing investment thus lowering the number of jobs and income tax paid, lowering revenue by reducing the activity level and amount of production. If killing the Alberta advantage is going to get you relected, think again.
RRE3936 I think it would destroy Alberta's strong economy. No one in my immediate family is employed in the petroleum industry so my opinion is unbiased. The Alberta government and Albertans in general make more money from the trickle down effect of large coporations operating in our province than they would if they would start collecting high royalty rates and have these corporations leave Alberta. Some of the larger corporations, namely [Information Removed] , employ an awful lot of Albertans and make numerous donations to charities, organizations, and communities in Alberta. Having these corporations leave our province would hurt our economy and I think even lead to a recession. This report cannot go through!
RRE3937 Please take the time to consider royalties in both the global and Canadian context. Rates should be fair but not bargin basement. As a province, why is Alberta not working with other provinces to harmonize rates based on a comprehensive scheme? This would prevent oil companies playing each province against the other. As the global supply of oil and gas resources becomes harder to get at and more expensive, the resource rates should be able to adapt. It would not be wise to give away today what you will not have tomorrow. Also, a slowdown in production today could also encourage future production at a higher value. Oil and gas is like land or any other natural resource 'there not making any more". Once it's gone, there are NO royalties or the industries that value the resource. I would also question the timeline; all stakeholders should be part of the process. Why the rush to close this by October 2007? More time would allow consultation with the public, industry and the other provinces.
RRE3938 THANKS FOR NOTHING Mr. Stelmach. Hope you and your advisors enjoy going to work everyday. The hundreds of people ( your LOST VOTES in the next election) who work within the oilpatch generally only work 6 months a year (seasonl work!!) . As an oilpatch family, in a oilpatch community, you are only [Expletive] the hard working, blue collar Albertan's whose 'sweat' have truly made this province wealthy and attractive to people across Canada and beyond. HOPE OUR JOB LOSSES RESULTS IN YOUR JOB LOSS!! You are greedy, with no concern to the people caught in the middle....the blue collar men and women in the patch.. SHAME ON YOU!!!! I KNEW WE WERE IN TROUBLE WHEN OUR NEW PREMIER WAS A FARMER. Just to let you know my rig hasn't worked a single day since your proposed Royalty Review was announced. THANKS FOR NOTHING. You're biting the hand that feeds you. From where I stand you and your party are the greedy ones who will ruin our great province.
RRE3939 A recommendation to increase the royalties is great, but it was also recommended during Klein's reign and nothing was ever done. I hope the current government is not afraid to stand up to large resource companies and get a fairer share for all Albertans!! I fully support the recommendations in the current review report.
RRE3940 I hope Ed isn't looking at the issue as a matter of votes versus a matter of doing what's right. After forestry has fallen by the wayside, oil and gas is the last of our big industry sectors, as there's not much in terms of hydro electric in the province, and nuclear power hasn't hit us yet. It's the same old story of the big guys getting taxed enough to keep them from investing in the province. There's lots of petroleum on the east coast, and a lot more overseas. The oil companies don't need much of an excuse to stop drilling here and move their operations overseas, where, we won't see any of the royalties. Read CNRL's annual report for 2006, and they've already shifted focus to our east coast, and West Africa. Natural gas prices are barely high enough to keep the smaller oil companies in business, let alone take another chunk of their income. If you don't want to cause a major recession, put thousands and thousands of people out of work, out of homes, and onto the streets, don't make this mistake. Alberta is already in a surplus, let's leave well enough alone, and bring some more foreign money into our oilsands, so we can reap the benefits of that. We're doing well with what we've got. There's more investors coming in, and there's no shortage of oil & gas here. If you want your children to be able to enter a prosperous career in Alberta and Northern BC, you don't want these new royalties eating away at your industry. If you don't want your house prices to plummet, you don't want these new royalties. If you don't want crime to go up due to a big unemployment rate, you don't want these new royalties. Oil companies WILL pull out, we've seen it in the 80's. It's not being bullied, Mr. Stelmack, it's business, and business can be moved.
RRE3941 I am afraid that the proposed royalty changes are going to have a huge negative impact on the Albertan economy. The timing of this proposed royalty change is wrong when the both gas price and rig activity level are both near record low. This anti-business proposal is ontradictary to the Progressive Conservative doctrines. The impact of any capital budget cut back by the oil industry will have a far reaching effect cascading to most other ndustry sectors in the province. Why do we want to push the oil companies to invest in other provinces instead of Alberta. I wish the Premier of Alberta will shelve this proposal indefintiley. [Information Removed]
RRE3942 The negative outcome of this royalty review will greatly out weigh the two billon dollars the gov't will receive from the added royalites. It seems the gov't wants to kill the goose that lays the golden egg. I hope they consider the amount of people that will be on poggie. This will be the end of the already wobbly led conservative gov't.
RRE3943 I think it's another tax grab goverments take non of the risk but like to take the profits. It wasn't to long a go when Alberta said they where open for investment in the oil sands. Now you have investment you want to up the royalties. How can we trust goverments. Just like the feds backtracking on trust funds. If you raise the fees. I for one will pull my investments out and go else where
RRE3944 Don't listen to the oilfield spin doctors-the forecast of doom and gloom is pathetic at best,disingenuous at worst. Remember where they come from - the good ole USA - they have no one but self interest at heart. Take the Norway example , they haven't quit investing there yet despite the "horrendous" taxes.I live in Ft Mac and a little "slowdown" would be a good thing..
RRE3945 I believe the report to be flawed and that accepting it's recommendations will bring about a significant reduction in oil and gas activity...which will bring the Alberta economy to a halt. Please do NOT accept the recommendations as presented. Thank you.
RRE3946 I believe the government should be very careful about implementing any royaltiy increases. It would seem as a positive that the government will take more funds but an increase in royalties, if excessive, may kill many oil and gas projects, reduce the drilling activity and ultimately this will be counterproductive since this will represent less money for the province. Not to mention the fact that there might be lost jobs and less job creation in the future. The increase being proposed by the panel certainly seems excessive and it does not seem to be of any benefit for the province in general. [Information Removed]Calgary, AB
RRE3947 How come the polls's don't ask if the public wants to pay less tax for the same services........Isn't that what they are implying when they say a 20 % increase in Royalties won't affect the Oilpatch economy - I bet they could find 100 % of the public that would support that!!!! - STUPID
RRE3948 I would hope the Alberta government would take every aspect in to consideration before they do anything drastic regarding increased royalties. While I support more money in my pocket that doesn't do me much good if there is another disaster like the NEP which saw many, many people lose their jobs.
RRE3949 I would emplore the government to consider the royalty review in the light of current investment levels. Not only is the recomendation that grandfathering borderline criminal it discounts the good faith under which the projects currently ongoing were undertaken. As a taxpayer and citizen of this province I expect and demnd that my governemnt represent integrity and fairness in it's dealings with industry. I do not disagree that royalty review is an imporant part of the industry lifecyle but I would hope that the government would not abuse it's power and misrepresent the citizens of this province by accepting all the recomendations at face value. [Information Removed]
RRE3950 Please apply the recommendations of the royalty review report in their entirety. They are already a compromise. Don't compromise the compromises. We are not a third world country. Lets not sell off our birthright for a string of beads. Please show some leadership and backbone.
RRE3951 I have to ask why we are basing such important decisions on a report that looks at Gross Revenue and does not take cost into account? With this in mind, I find the recommendations in the report are flawed because it does not look at the entire economic picture of Alberta. Why do we want to compare ourselves against other jurisdictions that bare no economic relevance to Alberta? Alberta has its own economic climate that would be foolhardy to ignore. To follow the recommendations in this report would jeopardize the economy in our province . It could seriously put this province through the same pain that the National Energy Program caused in the 80’s. We need to take MORE time to determine what is right for Albertans when it comes to this new royalty regime. What is currently recommended in the report will not provide Albertans with any benefits.
RRE3952 My wife and I are employed as Geologists in oil & gas companies here in Calgary. We love the city and enjoy our work. We have watched Alberta's Energy Boom from 2003 to 2006, and have subsequently watched as rising costs, lower gas prices, and marginal return on investment has driven the cooling of Oil and Gas activity. In our positions, we are aware of the cost hurdles that are integral to oil and gas projects moving forward. Under the proposed "new rules", I fear that many of the projects on which we are deployed will become uneconomic and will be suspended. We have been told as much by our employers, and we can do the calculations ourselves. Current royalty rates and royalty "holidays", as currently employed by the Province of Alberta allow for the higher-than-normal costs of conducting our business here in the Western Canadian Sedimentary Basin. Gas and oil pools are in decline and are becoming more difficult and expensive to find. Initial rates from new wells are lower than ever before. Service costs, although correcting somewhat, are at double digit inflation rates. Drilling and service rig utilization is at a 5 year low. The Canadian and US dollars are now at par. Gas prices are below $6. All of these factors driving the economics behind drilling a well into the "uneconomic" realm. Many companies see better shareholder return in less expensive Basins elsewhere in the world and are able to move their capital freely while putting their Canadian assets into a holding pattern. The ultimate consequence is not a decresed profit and lower shareholder return (as will be the case), but is felt by the families of employees who are let go due to the decrese in activity. Our family could lose both jobs. I don't need to remind you of the potential negative impact on the local and Alberta economy of hundreds or thousands of folks losing work, of lower property values, fewer vacations, loss of purchasing and investment power, and migration of key technical staff to other Provinces and countries. Calgary and Edmonton could be hit hard, but the reverberations would be felt also in the field operations, where many jobs, much community investment, and service support would be reduced or lost. All I ask is for MLAs to consider the full weight of (what I believe) to be unfair, poorly conceived, and punitive new royalties. Sharing profits from a profitable industry is intelligent. Snubbing out some of that profit and sharing less is illogical and self-destructive. Thanks for your ear.
RRE3953 I am very concern with this new royalty regime the government is reviewing. I am sure it will impact negatively the delicate balance in the economy of this province, if implemented in fully. The ripples are being felt already, Encana is reducing $1 billion there budget and sooner than later all other oil and gas companies will follow, which translates in less production, less money, downsizing, unemployment, rise of delinquency, and you go from there. In summary, Alberta's urban decay in the long-term. I think what is necessary to stress here is that maybe, the government will get more money today, but tomorrow it will not. And wouldn't you want to implement something sustainable in the long run? In addition, I encourage the government to make a thorough internal revision to make sure royalties being collected with today's regime are really being collected in an efficient manner. Thank you for you time. Sincere regards, [Information Removed]
RRE3954 I don't believe changing the royalty regime will have any positive effect on the government purse or to all Albertans. In fact, I believe it will have grave negative consequences. With how low margins are on new gas oil projects in Alberta any increase in royalties would make most projects uneconomic especially compared to the much lower costs that the U.S. has currently. I would hope you and the other MLAs would see this as I do and therefore leave the royalty rates alone. We should not want to kill the Alberta economy. If royalty rates were increased 20%, without a doubt production would be at least 20% less within 2-3 years because of less capital spending in Alberta, and therefore the Alberta government would not gain anything except that there would be a lot of additional job losses and Alberta would be seen internationally as a place not to invest. We want Alberta to remain the most business and investment friendly province in Canada.
RRE3955 The Government of Alberta should see to it that Albertan's receive their fair share from the development of our energy resources. The recommendation by the Royalty Review Panel should be adopted in full by increasing our share of the oil and gas revenues by 20%, or $2-billion, annually. These are non-renewable resources and we owe this to ourselves as well as to generations to come! Please do not be intimidated by the threats made by the spokespersons for these corporations. Newfoundland's Danny Wiliams provides us with an excellent example of successfully confronting such people. -- [Information Removed]
RRE3956 I believe that more consultation with the industry is required before the government goes through with this recomendations. The reprecussions from this issue affects too many to be taken lightly
RRE3957 Increase the royalties. In fact increase them MORE than the 20 % that is being discussed. This is NOT the time for compromise or BALANCE. YOU ARE GIVING OUR RESOURCES AWAY. The oil companies are not going to go somewhere else, there is no where else. Copy Norway. We should be getting a lot more and investing it is a true Heritage fund Read the book 'Stupid to the last drop' and STAND UP FOR THE PEOPLE OF ALBERTA
RRE3958 There is no question that the current royalty review furor is potentially dangerous talk. The viewpoints are becoming quite polarized without making clear the underlying reasons for the positions espoused. It is a very complex debate that cannot be transmitted clearly in "sound-bites" that our TV-sitcom-oriented society likes to see. My involvement in upstream business opportunity evaluation throughout my career (I'm now retired from the business) leads me to make these comments. Most of my career was spent in the international upstream (mostly exploration) petroleum business.The companies I worked for used to evaluate potential opportunities and compare a venture's fiscal regime in terms of rate of return using a hierarchical ranking of all international petroleum fiscal regimes. If I remember rightly, the chart originated with an industry analyst named [Information Removed]. We called it the [Information Removed] Graph and it would be trotted out any time we were evaluating an opportunity in country X. We'd calculate the project value and risked rate of return and slot it into the [Information Removed] Graph. This tool demonstrated that the ranked rates of return lined up in value so that one could see the effects of political risk, technical risk, competitive pressures (where countries without much oil offered better terms to attract investment), etc. Alberta fell somewhere mid-pack, Saskatchewan somewhat down the pack (lower rates of return than Alberta), Canada federal lands (Arctic, east coast) higher, etc. though these were sometimes not straightforward to evaluate with all the various PIP incentives, etc, that have been in place through the years in Canada. Nevertheless, Alberta has never offered the best economic terms, and it has been downgraded by Canadian authorities' propensity to, every once-in-a- while, CHANGE the deal (the NEP effect). Technical risks are mostly easy to mitigate and manage. The highest-of-high technical risks require good rates of return and maybe event fiscal term incentives to attract investment in very expensive projects. This is why deep-water exploration fiscal terms are sweeter than shallow-water terms, as an example. Foothils gas exploration, with its higher costs, is another example. Even so, the industry has become quite good at managing technical risk and making exploration more predictable, in aggregate. But while technical risk management has become much less of an issue, in the last five years I think the theatre of non-technical risk, worldwide, has changed somewhat for the worse. Big companies that live quarter-to-quarter need stable, predictable returns and we've seen that they'll happily take lower returns to achieve greater predictability to stabilize their market capitalization and assure access to capital (if you need an example, look at the hedging strategies many companies employ). The bigger the company, the more true this is. This has made moderate rates of return offered in jurisdictions that are safe (little chance of political, military or terrorist interruption or expropriation) much more attractive than they used to be. This is why, with more uncertainty these days to oil supply against more demanding oil markets, companies have rushed to get into oil sands in Canada, even though the investment costs are relatively high. The technical risks are easily manageable and the rates of return, even though they are modest, are highly predictable for many decades into the future. The oil sands is a very attractive business to be in. Expensive, yes. But stable, predicatable safe returns make access to capital easy for oil sands investment. Even if our Canadian governments demand more return from oil sands projects, companies will still clamor to get in, because the technical risks are so manageable and the non-technical risks are so very low. I'm inclined to think that we should, at least, add an environmental levy of some sort to the cost of doing oil sands business to mitigate the tremendous environmental disaster that we are creating in Northern Alberta. The natural gas business is different, with considerable price volatility affecting the business dramatically. We go from feast to famine: within the last 11 years, the gas price has ranged from 73 cents to, what, 18 bucks? Good rates of return under risk analysis are needed to make this business more predictable to sustain our domestic natural gas business. An additional factor that has not been mentioned is that, ultimately, when imports of [Information Removed]into the North American gas grid reach a percentage share at which [Information Removed]becomes the swing supplier, that will have the effect of providing a ceiling on natural gas prices. I would say that the long term outlook for natural gas prices is modest, barring some massive interruption in LNG supply. However, the cost of services to support our gas business has been driven up by the land-rush mentality that is sucking industry services and resources into the oil sands. This high cost of services, in conjunction with a soft natural gas price outlook, has hit the domestic natrual gas bussiness badly. I think we need to cool off the oil sands fervor. Let the government take more oil sands revenue from the pie and cool off the industry's investment rate there. That will ease the cost pressures that are currently killing the domestic natural gas upstream business. This is where I stand on this, until other arguments convince me otherwise. Our natural gas business in Alberta is actually threatened by the massive rate of oil sands investment. I think we need to fix that.
RRE3959 Hello, of course all Albertans are wondering what happened to our government. How has this happened? I am of course referring to the Royalty Review proposed changes and what impact it will have on our ability to feed our families and pursue a better life. Where has the Alberta advantage gone? Not long ago we were giving it away, some might argue to people randomly. Surely we have not gotten into financial trouble already in the short period of time between then and now. I beg this very seriously as someone who routinely runs project economics in this basin and as a technical person who has made this business his life’s work. Please, do not pursue this recommendation as it will, for sure render our ability to provide for our families and our futures less than the day before. We of our age, have had years of productive progress taken away by various Liberal Socialist Federal Governments, and we have always looked to you and your government to not only provide needed buffer, but to outright protect us from them. I am actually not even angry at OUR government for turning on us all and our children, so much as I am sad and now realize our dream is disappearing being killed deliberately by those on whom we thought would never betray us. From the Gas over bitumen issue that we all remember, and it has damaged the gas sector because of these rulings, now again with the royalty grab it is dealt another blow. If you need someone to provide some insight into basing economics for your government, you can ask, there are a number of ways for your government to procure this information and knowledge. Hiring an ex-forestry employee is likely the long way around especially for such an impactful decision. Once again Please, return our Government to us, we do not need to suffer another hit that jeopardizes our future and the well being of our families. If Ed wants to be a Liberal, he only needs walk across the floor and buy his membership, he does not need to betray us all to do so and put us all in such peril. [Information Removed]
RRE3960 royalty system ain't broke, so no need to fix it -- things are good right now just the way they are -- leave things alone
RRE3961 Albertans DO need their fair share. How? Please consider the following suggestions: - provide returns to Albertans (cheque form) - provide home owners with an extra bonus - provide a bigger "baby bonus" to Albertans - support our child care system, increase amounts to the Alberta Association for Early Learning and Care Services, provide financial support to the licensed out-of-school care programs in Alberta (invest more money in Alberta's Children) - support our education system - improve our medical system - improve Alberta's "connectivity" - invest in plans to have high-speed rails connect Grande Prairie, Edmonton, Red Deer and Calgary. Make Alberta THE place to live in Canada - allow Albertans the opportunity to travel safer and enjoy their province more. - it's time to stop charging Albertan's access to the Rocky mountains - perhaps there can be a rebate program in place where if you buy a yearly pass and you're reimbursed the cost if you're an Alberta resident.
RRE3962 Please proceed with caution. I dont want to be unemployed by a huge increase for gas producers in Alberta. Please remember the National Energy Program in the early 80's. A lot of people were laid off, house prices dropped below mortage levels and alot of people left Alberta. The gas business is already in trouble with a gas price of 5.00. Please be careful, if the conversative government does not fully understand the impact of such change, maybe it time to change the government to a different party, that will try and understand how impossible this Royalty change for gas is right now.
RRE3963 As a family whose father and husband works in the oilfield i have serious concerns regarding the review. With the three major oil companies ready and waiting to pull almost all of there Alberta Allocations what will happen to those who are depending on those jobs. My family is not the only one at stake. Alberta is an oil based province we depend on the oilfield for everything from the hotel industry to housing. We are one of the families that will be unemployed should this royalty take place. Is there not a more responsible and sensible approach to the problem? Could it be as simple as doing the increase a couple of a percent each year for several years to minimize the economic impact? Who is going to explain to my kids that the don't have a house because dad lost his job and we can no longer pay for it? On that note this is hardly a solution that will help Alberta's homelessness issue. Thank you for your time. [Information Removed]
RRE3964 Non oil patch people does not understand this 100% gamble business. What they see, the present oil price in open market, and they jump to conclusion with out any logic. I have been self employed and well site geologist since November, 1977 to present, and I have seen worst results after any Royalty-Increase. Please" DO NOT INCREASE ANY ROYALTY". [Information Removed]
RRE3965 i think the government is getting greedy and if they go through with it they are going to hurt alot of had working Albertans.
RRE3966 pLEASE MEASURE THE TRUE ECONOMIC IMPACT OF YOUR DECISION. IT COULD CRIPPLE OUR ECONOMY. The basic fundamental assumptions for certain capital costs the Panel used to develop the Report are low. Under the proposed new royalty program, many wells will become uneconomic. Existing approved oil sands projects have been proposed and developed based upon the current royalty program and rates. By substantially increasing the royalties on oil sands, there is a significant risk that new projects will be cancelled and future expansions scaled back, delayed or cancelled.
RRE3967 Thanks Alberta . 1980 all over.
RRE3968 I'm a contractor for a large Oil and Gas company. If the royalties are to be implemented as planned I risk loosing my job because of the scaled back production in the field. If that’s the case I will likely never vote for an Alberta PC again. If you want a Liberal majority next election then go ahead with the increase in royalties.
RRE3969 Can [Information Removed] buy rec centres for the rest of Alberta not just Fort Mac? Also more ambulances and shorter wait times for healthcare? A royalty review is much needed.
RRE3970 I have concerns with the message the Alberta government is sending out to us in regards to the Royalty Review. I keep hearing that this will take money from the " Big Oil Companies " and give it to Albertans. I, as do many Albertans rely on an active oil industry for my income. Royalties do not go to people they go to the go the government and then hopefully they are used for worthwhile public projects. As the government is currently carrying a surplus, (mainly due to the current royalty arrangement) we can assume that the projects that are worth while are being funded. I see this as a balance, If oil companies are active,they do make money, so does the Alta government, so do I and many other Alberta oil workers. Comparisons of royalties that are paid in other parts of the world are not necessarily applicable to Alberta. While royalties may be more, other costs may be less due to a more favorable climate, or different regulatory obligations or a cheaper work force etc.etc. Oil companies like all succesful companies are going to favor areas where they get the best return on their dollar. If by changing the current Royalty arrangement the Alberta government will run the risk of making the province a less attractive place to do business. This will slow drilling and oil sands development, this will put Albertans out of work. As for royalties, the Alberta government could find it self receiving a larger percentage of a much smaller number. After a short period of inactivity the provice could find it self in a situation where we don't have budget surpluses.I think the province would have a hard time balancing a budget without the current funds from taxes and royalties received both directly and indirectly from the oil industry and the people employed by the oil industry. I ask the provincial government not to be short sighted in their decision making. The only way that Albertans get value from their oil and gas resources is if someone gets it on production. The oil industry is a global industry, you must keep Alberta an attractive place to do business for the good of us all.
RRE3971 I am very concerned business (shot drilling services) man who is not liking the outcome of this proposed royalties increase of 20%, I think most in the industry would more than welcome a small incremental increase over five or so years, we are already told if this comes to fruitation that our winter drilling programs will be cut in half, our company employs 8 people but with this proposal we will also have to halve this number , if there is this much greed in our Government then i think a change is in order as this will reflect the whole province very seriously Thanks for Listening
RRE3972 To whom it may concern, I am glad to hear policies are reviewed periodically as they should be. However, increasing royalty rates in Alberta will kill a once vibrant industry. The large multi nationals will not see any benefit in doing business in a market that has the highest cost of doing business in the world. Why would they do business here (Alberta) when they can "fill there pipelines" so to speak more economically anywhere else in the world. DO NOT increase royalty rates unless you want to kill an industry and increase unemployment and the associated burden on our social system. Best Regards, [Information Removed]
RRE3973 The federal and provincial government has put a screeching halt to the once booming energy industry. First was the reversal of Trust Tax, now dealing with the Royalty Tax, next the carbon tax. Who would be crazy enough to invest in our energy industry. I have been born and raised in Alberta (45 years). My dad, brother, husband, father-in-law, brother-in-law, sister-in-law and their extended family have all contributed to the economy because of the jobs the energy industry has provided us. If you keep throwing all these taxes at the industry I am afraid you will bury us alive... our province and the people. Do not raise the Royalties to more than 5%.
RRE3974 I am against raising the royalties on oil and gas. Alberta is experiencing a strong economy and I don't think the government should do anything that might jeopardize that. I am a single mother and rely on the oil and gas industry to support my family and myself.
RRE3975 I am writing to express my concern with regard to the Royalty report. I believe many Albertans are misguided in their quest for more revenue from the oil and gas companies operating in AB. As a employee in an oil and gas company, I see the government choosing to increase the cost of operating when many companies are already slowing down because of the marginal economics that are present particularly in gas - just witness the # of idle rigs in the province without a royalty increase. Additionaly if you have been following oil sands economics it to is becoming less desireable . One only needs to review [Information Removed]cost estimates and expected return on capital to verify - again those numbers were supplied several months ago prior to a potential royalty increase. I believe most Albertans have benefited from the strong oil and gas activity over the past years regardless if you are an employee or service worker who has benefited from the increased business. Also lets not forget about the additional taxes all of us have contributed so that government services can be maintained, capital projects entered into and debt repaid. In short, I believe most of the people demanding increased dollars will have short memories when it comes time to vote if they find they have been terminated or if they have had their livelihoods impacted by drastically reduced industry activity . I think some high level meetings are required to consider a royalty proposal that takes more when economics are strong and less when this is not the case. [Information Removed]
RRE3976 I think that you were right in doing this because it can help our province and area with lots of different things
RRE3977 As a born and railsed Albertian I am asking please do not implement the recommendations of the royaly revew panel. I expect if the recommendations are implemented I will be out of a job within 3 months. I have currently stopped spending on anything that is discretionary (investments, a car, etc) as I prepare for the possibility that I will be unemployed. I believe that the oil companies are not just making an idle threat. Having lived through the early 80's in Calgary I have no doubt that history can repeat itself.
RRE3978 A change this detimental to our economy must be based on facts not fiction. This is to big of a decision to rush. The whole review feeds on those who are not informed and this is not fair...both sides must be made visible to the general public.
RRE3979 Although I strongly agree with the government on increasing the oil and gas royalties in Alberta, I think the government should do it on a more tolerable pace. A 20% increase in royalties would cause a enormous shockwave for the producers and service industry to adapt to. Many companies in the service industry would likely go belly up, if such a royalty is implemented. Albertans are experiencing a very healthy economy at the moment, and alot of it has to do with the oil and gas industry. Implementing a 20% royalty hike would divert many investors from bringing their money to Alberta. As good as a 20% hike would sound to the public, the public also needs to realize that a decline in investment in Albertas oil and gas sector would have a great negative impact to our economy. I work in the industry, and currently in many of the senior level positions at the oil and gas companies, there is a lot of fear with what is going to happen with the royalties. Many fear a adjustment in capital spending towards projects and therefore leading to a decline in the large number of projects that are either currently underway or planned for the future. When the government polls the public whether they support a royalty hike from the already extremely wealthy oil and gas companies, a majority of the public is going to yes (Its like asking a child if they want free candy from the candy store). But not many people understand the true repercussions of implementing a royalty hike. At the moment, I believe the big producers are probably just trying to use a little bit of a scare tactic to avoid the royalty hike. But implementing the royalty hike is a gamble for the economy that many of us don't want to risk. The Alberta economy is strong and wealthy so lets not do too much to shake things up too fast. I would suggest implementing a incremental approach to the royalty increase to allow producers to strategically adjust to the increase.
RRE3980 I work in the Oil and Gas industry. This decision will impact my business. I am a 34 year old, married with three children. I live in Airdrie, moved here in early 2006 when house prices in the Calgary area started to sky rocket. Of course this means I have a mortgage. I work in the Lease Construction part of the Drilling Operations for an Oil and Gas company, this means I see the impact of costs on a daily basis. I see projects that were economic three years ago, fall off because the rate of return to our company. By following the Royaly rate increases the panel suggests, we will for sure see projects halted, job losses, and less capital spent in Alberta. Thanks, [Information Removed]
RRE3981 Dear Sir or Madam: I completely disagree with the majority of the Royalty Review Panels recommendations - particularity the lack of grandfathering. The report contains way too much propaganda to be taken seriously. Alberta is currently a wonderful place to live, to work, to bring up a family, and to call home. I was born in Alberta and for the first time ever, I am very concerned that the provincial gov't is about to make a very bad decision for virtually all Albertans. I have to ask the question "if it isn't broken, why are we trying to fix it?" I have done some rough economics based on the panels recommendations (and you only need to do rough economics) to realize that anything but a small, well directed royalty increase would be suicide for the gov't and have a negative effect on the vast majority of Albertans. The majority of Albertans are not employed by oil and gas companies, but the vast majority rely on the "trickle down effect" of all of the oil and gas money in this province. Ralph Klein had very high popularity, Albertans liked him - he didn't touch royalties because he knew that he didn't need to do so. Ed Stelmach has very low popularity, and it's about to get a lot lower (in the long term) if he does anything except a small, well directed royalty increase with grandfathering of all existing projects. Thanks for your time. Sincerely, [Information Removed]
RRE3982 At present, I think that we should leave well enough alone, As a senior, think that something should be done is to increasing pensions / health care, to be able to make ends meet, in the current market. We can not afford a royalty increase vs investment/stocks decline. Please respond: [Information Removed]
RRE3983 Premier Stelmach, Since this oil boom, the quality of life of many, many Albertans has become seriously eroded. I am appalled and disgusted, that with Alberta being so "Oil Rich" that we have the economic and social problems that we do. I can't imagine that we have homeless people, who have had to have amputations, during last years winter but who have jobs and no where to live. It's hard to believe that the middle-class cannot afford to buy a home. We have to risk our lives just to drive to work or live in the city where traffic accidents and murder and mayhem now seem to be the norm. I urge you to raise the royalty rates to the full 20% recommended because this province needs to fix it's ills and become the province we once were. We all realize that Ralph Klein sold us out. Please be the leader we need to stand up for all people in this province and not just the rich. We need schools, hospitals, affordable housing, road repairs, etc., etc., etc. Where is the money going to come form? As a person born and raised in Alberta, all I want to do is leave because it does not feel like my home anymore. All I see now is tremendous greed and rampant crime. From Landlords forcing people out into the streets to drug dealers taking over our City. People forced to have miscarriages in the waiting room of a Hospital. It's sad and it gives people a real sense of hopelessness that there doesn't seem to be anyone that can stand up and change things. Maybe you can be the leader to give us back our quality of life. Or maybe not. [Information Removed]
RRE3984 Hello, I believe that the recommendations of the Royalty Review Panel is flawed and short sighted. To change the rules of the game after many new oilsands projects have already been approved by shareholders of a number of public companies is akin to the Federal Government's change of stance on the income trusts. Changing the rules at this point changes the economics of these projects and transfers undue risk to citizens who have invested in these companies. If the Alberta Government missed the boat on the royalties, they need to accept that as their mistake and if 'Albertans' feel liek they deserve more, they should have thought about that too. Alberta has a competitive advantage and if the rules are changed, it will only hurt Albertans through the repercussions of companies scaling back their projects or cancelling them outright. It will also benefit the various dictatorships in the rest of the world who can sell the resources of the country and cut-rate prices (which Alberta has not). The government better think about this VERY carefully. Please don't squander the Alberta Advantage. [Information Removed]Calgary, AB
RRE3985 I would like to express my opinion on the Royalty Review and proposed actions. I do not support the proposed increase in royalties. Do not kill the golden goose (oil patch). Simply remember: if it is dead, there will be no new golden eggs to come in the future. Sincerely, New Canadian [Information Removed]
RRE3986 I think that when governments in general have a lot of money, they become corrupted. A further fact is that when people receive a lot of money, it spoils them and they become useless. But I would rather see individuals receive a healthy dividend when there is a healthy government surplus, because individuals will invest the suplus dividend more wisely than government and bring a larger return to the economy and to themselves. We are very over governed, over-taxed with over 55% of our wage going to taxes when you count all levels of governments with their hands in the taxpayers' pockets. I think Ralph's idea was a good one and should be done annually. The government keeping all of the surplus for "programs" is useless because most of the progam money never trickles down to the taxpayer because the bureaucrats in their social engineering wisdom see to it that more government employees are hired. I suggest that if you give $10,000 to every family of two to four individuals, they will invest or spend the money on stuf or on investments they think they need to do. I believe this is what creates big growth. However, when you give the same amount to the hands of government bureaucrats, they will squander the money on non- performing projects such as government workers' wages, and make the pitch that the programs they implement will yield a return. The tax cuts implemented in the US in recent years have proven great growth stimulating effect because the individual is the wisest investor. I donot think the royalty review is a good idea, except maybe on a token basis. And, I am also against "rainy day" funds. The money gets squandered by some perhaps well meaning political leaders but the recipients are actually worse off in the end since free money motivates a welfare mentality. [Information Removed]
RRE3987 Oil companies should be paying the same royalities as they do in other countries. Why should they get a free ride here in Alberta? It's not like they are barely covering the cost of operating a refinery here. Time to stop the price gouging. All you have to do is look at the gas stations: 3.5 cents off here - Imperial oil even has a sign out front of some stations offering 5 cents off if you use their "Speed pass" - the savings should be offered to everyone not a select few (this is not a private club).
RRE3988 Its about time! I am sitting here reading news articles on how these companies are going to have to cut jobs if the Government goes through with this and all I could do is think how much profit are these companies making off Alberta? They feel that increasing the royalties paid are going to cost them so dearly that they have to lay off staff? PLEASE! It makes me sick that these companies do not want to give back after years of taking. Personally I think the Government should control the reasources fully. I dont think the the purposed royalties go far enough, but you'll never find a politician who is will to stick thier neck out and go against BIG business. Such a shame. Already reading news reports that Stalmach is back tracking a little... SUCK IT UP PRINCESS, do whats right for this province already. Oh and a highspeed train to Calgary from Edmonton? make it Edmonton to FT MAC!
RRE3989 I have read the final report of the Royalty Review Panel and have done some work to analyze the findings that they have made. I urge you to be very careful in how the government of Alberta proceeds in it’s review of the royalty regime in this province. There is no doubt in my mind that these people tried very hard to do their work with appropriate due diligence and care. However, the report is based on many misconceptions and inaccurate information. The resulting media and public response has often been based on false information and a misunderstanding of how the oil and gas industry works in Alberta. We have been fortunate in this province to have a resource base that has turned our province from a financially poor part of our great country to being a major economic driver. We are debt free and have no sales tax due to our resource base. However, the population of this province and it’s government has not given us this remarkable financial position – it is the men and women who have taken the risks and invested their time and money in developing the resource base. Yes, many have been amply rewarded for their successes (as entrepreneurs are in any successful business), and yes the resources belong to all of us. But most of us are simply not capable of accessing and developing the resource. We need the industry and we should not be painting them as the bad guys. The people of this province, through our government, collect land fees (not accounted for in the review panel report) as well as royalties and taxes. The royalties are percentage based and are taken right off the top. We do not share the risk of drilling dry holes, nor do we share in the highly variable costs of development and exploration. Most people that I have talked to do not understand this. Nor do they understand that our conventional industry is comprised mostly of gas and little oil outside of the oil sands. The oil equivalent price for gas right now is about $30 per barrel – far from the $80 used in the report. The oil and gas industry in this province has undergone significant change in the last decade. Productivity of wells has dropped while costs have escalated. If you compare the productivity of wells in Alberta with those in Norway and Alaska, our production rates are miniscule. The most productive wells are the deep wells that are also the most expensive to drill and are the most risky. Finding costs are much higher in practice than the panel has reported, so their rate of return figures are terribly misleading. Many people are complaining that the industry is acting like a bully in talking about taking their investment dollars elsewhere. What these people fail to understand is that capital is very fluid and it will go where the economic environment is most stable and the returns on investment are the best. That is just good business. We are already seeing a slow down in the Alberta economy that is directly related to the strengthening Canadian dollar, change in income trust and other taxation measures, and the sharp decline in the price of gas. To compound this by implementing the dramatic changes in the royalty structure would be to invite a recession. This will affect every Albertan either directly through loss of jobs or indirectly through the secondary impact on other businesses and decreased government revenues. I believe that implementing the recommendations of the Royalty Review panel will have an immediate and very negative impact on Alberta. Look at the responses from the investment community: BMO Nesbitt Burns, FirstEnergy Capital Corp., Deutsche Bank Securities Inc., Tristone Capital. All are criticizing this report’s research and the resulting recommendations. All are predicting a large decline in reinvestment in the province if these recommendations are implemented. This is not a change that can be made without significant consequences that I believe will be bad for all Albertans.
RRE3990 I was just informed that YOU, as the Premier, are also responsible for the LOW WAGES in the Construction Trades. There were recent strikes in Edmonton, and Fort McMurray regarding this issue. Those Low Wages also effect, AUPE workers, and the Minimum Wage which is very low. The Conservatives, meaning YOU, the Premier, want low wages to increase the Profits of the OIL LOBBY How many people are employed in jobs that are receiving Low Wages because of YOU as the Premier? Another BIG mistake YOU are responsible for. 1) Royalties, 2) Power Line, 3) Pipeline for Crude,- Lost Royalties, Jobs, Taxes, 4) Farm Fuel, 5) Low Wages, 6) Labour Laws, How popular does that make YOU as the Premier with the voters for loosing Billions and Billions of Dollars to America?
RRE3991 When Bolivia changed their royalty rates the oild companies all threatened to leave. They raised a huge fuss. However, a short time later they all signed on to the Government new royalty regime. Bolivia's royalty return went from $300 million to $2.7 billion one year later. The royalty review report is not recommending anything as dramatic as what hapenned in Bolivia. I support the recommendations made in the report. Thank you. [Information Removed]
RRE3992 Please don't give in to the threats from the oil and gas companies. They are only thinking of the short-term and their own profits, we need to keep our eye on the long-term and do what will benefit the people of Alberta for generations to come. This uncontrolled growth we are in is unsustainable--another word for uncontrolled growth is cancer. We need to do better than that. Don't be afraid to make the tough decisions, forget the polls, forget the next election. The Royalty rates must be raised, for the sake of our environment and ultimately for our future.
RRE3993 I was born and raised Albertan - as were both my parents - and I have worked in the oil & gas industry for [Information Removed]years after spending most of my childhood growing up around the industry. My parents and myself - as well as thousands of other Albertans - are pround of our province as we have worked hard and have seen it come from a 'have-not', sleepy, agricultural province to the successful and envied province it is now. I had just graduated high school when the NEP was introduced and - after watching [Information Removed]die before my very eyes - it took great determination to get an education, break down doors, and break down barriers to work in the energy industry during the recession. Anyone who works actively in this industry knows that we have been facing numerous challenges throughout the past year (never mind the past few decades) - including the HUGE impact in the downturn of drilling activity lately. There are bankruptcies already among some small producers, financing is incredibly difficult to come by these days, along with many other issues. As for myself - I am a consultant who now cannot find any work. (NOT everyone who works in the industry is wealthy and can ride out these situations). It was starting to get very lean with the downturn in activity but, with the announcement about the Royalty Review, I'm just pleased [Information Removed] If there is a downturn in the economy of this province my husband's job will be severely impacted and he will NOT have the earning potential he has now and that is a deep concern for us. Both of our parents - PEOPLE WHO HAVE HELPED BUILD THIS PROVINCE - have told us that they will help us through any downturn. Isn't it sad that the government can't help us? Oh, I forgot, they are proposing to cause this. I am stunned that the Alberta government does not have it pulse on what is happening to the energy industry and it's employees and contractors and that the data used in this study does not accurately reflect the current situation. Anyone who works near this industry knows that it is volatile and can be a "roller-coaster" ride depending on economics, world events,etc. and , what was a rosy outlook yesterday, can be much less rosy today. I am dumb-founded as to why you want to cripple our province with this "ALBERTA-MADE N.E.P." My husband (also born and raised in Alberta) and I are now talking about leaving this province - the province of our birth. I now envy people who have the option to "go home" (to another province or country). I just can't understand why my government would crater our economy for a few lousy books more. Guess what? 5% (more) of nothing is NOTHING. If you don't like revenues of $8B/year from royalties how about $1B/year with more social and debt issues? Will that help the infrastructure issues, et al?
RRE3994 My name is [Information Removed]& i make my living in the oilfield. I do not understand why the government feels the need to increase royalities, they all ready take there fair share. Do people actually know that Alberta is the only province / state in North america that is debt free, so what ever were doing can not be that bad. Premier stelmach is shooting himself in the foot, he thinks he will generate more capital by increasing royalities, where in the end he will have less than he has now. Most of the plays in Alberta are not economically viable at current gas prices, the oil companies will just quit drilling & move to BC, Sask, USA, believe me, i am employed by one pf the largest oil & gas companies in North America. Remember the NEP of the early 80's, well this will be a mirror image of that. Think of all the people that will be out of jobs, people that bought housing at high prices in the last few years, it will kill the entire enconomy. Myself never expected this from the provincial goverment, this is something that Ottawa would be more inclined to do. I presently live in Calgary, & have had job offers in the USA, but have turned them down because of my love for Calgary & its environment, if this new tax structure is implemented, myself & alot of other co workers will be moving South of the Border as will alot of the service sector. I think premier stelmach needs to wake up & smell the roses & think back to the NEP days & think do we need history to repeat itself
RRE3995 The government should absolutely raise the royalty rates. The only stipulation I would like to see is they be phased in over a 3-5 year period, to allow oil companies adequate time to adjust their budgets. I am an engineer, and have worked in several industries in Alberta, but mostly in the oilpatch. I have seen the economics from a variety of viewpoints, and there is ample economic room to institute these changes --- don't let the oil companies' scare tactics deter you from doing the right thing for the people of Alberta. They are acting from simple greed. Further, the oil (both conventional and oilsands) is going nowhere. WIth oil prices continuing to rise, there will be strong demand for this commodity regardless of Encana or others reducing their local budgets in the short term. They will be back, in short order. Additionally, the present pace of development in the Oilsands region is unhealthy for the province. Not only has it driven up the costs of virtually everthing, we are simply playing into the hands of the U.S. by extracting as much as we can as quick as we can. U.S. policy has long been to keep as much of their domestic oil as possible, all the while depleting other nations supplies first. This is a non-renewable resource. If we don't start to keep more of the proceeds in the province, where will that ultimately leave future generations? In a time when the province is screaming for more hospitals, schools, roads, mass transit, the least oil companies could do is pay a relative pittance more in the form of royalties, in order to help build infrastructure. Look at Norway. They have much higher royalty structures, and oil companies have not stopped exploring in that region, where the costs of offshore rigs in the North Sea are not exactly cheap. Finally, I am a life-long Albertan, and have always supported the Conservative party, as they have most often done the right thing for the people of Alberta. Raising the royalties is not only a good thing to do from an economic standpoint, it is the right thing to do for Albertans. Regards, [Information Removed]
RRE3996 Hello Mr. Stelmach, I would like applaud your initiative to establish and conduct an independent and transparent review of the royalty regime in Alberta. This was one of your first actions when you took office and it provided me with confidence that this new government would be different from the previous conservative governments - you would actually listen to the people of Alberta. Now that the results have arrived and clearly state that the people of Alberta are not getting their fair share from oil and gas development, I am discouraged to hear that you may not fully implement the recommendations of the review. I have lived and worked in Alberta for over 30 years with much of that time spent in the energy sector. It is about time that this sector started to pay its fair share, and implementing these recommendations is a first step in that direction. This type of review should be conducted at a regular basis (i.e., every two or five years). If anything, the oil and gas industry should be paying a premium for conducting business in Alberta compared to some of the other more risky regimes in the world. My question for Mr. Stelmach is whether this decision to not implement the entire recommendations is based on tinput from Albertans or input from oil and gas companies? The last time I checked, the oil and gas companies do not vote in provincial elections. And failure to implement the entire recommendations will ensure that I do not vote for a conservative government in the next election. Please do the right thing and listen to the people of the province and not to the corporate interests. Regards, [Information Removed]
RRE3997 Your email has been received into our mailbox. [Information Removed] DATE RECEIVED BY MAIL WAS Tuesday, 02/Oct/2007 07:46:18 DATE ENTERED {ts '2007-10-02 08:00:01'}
RRE3998 I read an editorial in today's Medicine Hat News. It stated that the premier reassured some members of the business community over the weekend that there would NOT be a change to the existing royalty structure for current projects. ' I can assure the Provincial Government that a great number of the seventy odd percent of Alberta voters who believe there is a need for radical change to the royalty rates will actively campaign for a change in Government. I think thirty some years has been enough of one party. There appears to be an attitude of entitlement and gross arrogance in the current Government and oil industry. Please rest assured that the severance packages available to MLAs are more than adequate to cushion the landing with the Golden Parachute.
RRE3999 I just wanted to provide my two cents worth. Please consider all of the potential impacts and benefits prior to making a decision which will affect all of us for