| 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 gov
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