January 29, 2016

Notley's royalty review isn't over, so neither is investor uncertainty

Ezra LevantRebel Commander

So today, Rachel Notley unveiled part of her new royalty regime on Alberta oil and gas.

Royalties are the payments that oil and gas companies have to make to the government for producing anything from under the surface of the earth.

There was no need for this royalty review. Alberta just went through this a few years ago.

She said a few things — that oilsands royalty rates won’t change. Thank God for small mercies. Imagine the billions of dollars that would have fled the jurisdiction in the next week had she done so, just like the billion of dollars that fled the province after her last attack budget.

But there will be other royalty changes, that she hasn’t clarified. This royalty review has been hanging over the head of the industry for more than half a year and it isn't done yet.

If you were an oil and gas investor, in New York or London, or Hong Kong, would you say, "We’re safe to invest in Alberta now?" Of course not.


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commented 2016-01-30 23:13:00 -0500
Liberty and freedom;
Freedom is when the bird finds the cage door open…
Liberty is when you annihilate the one who tries to cage you.
commented 2016-01-30 23:10:38 -0500
Roy Jeanine…
To answer your question how do I know… Because I live in Alberta stupid..!!!!!
commented 2016-01-30 19:04:12 -0500
Great comments by Michael and others. There’s not much to add, other than to emphasize that he Left are psychotic. There inability to learn (from mistakes or history) is all the evidence one needs!
commented 2016-01-30 12:39:07 -0500
James Scott – in my opinion it’s quite communistic of government to think that they (and they alone) know what operating efficiencies are important to an industry. A free market means that prices will not be fixed, which over time will mean that there will be good times and bad times. During the good times nearly everyone in the business will do well. During the bad times those who are less efficient will go out of business (because they don’t make enough to pay their bills, including the labour bill).

Government mucking about with companies and charging some more than others <i>based on what the government thinks should be the correct metrics </i> is a way to make production cheaper for some and more expensive for others, making the market less free. Government can’t pick the winners in an economy (those who buy the products do that) but they can cripple otherwise healthy companies. The worst aspect of a banana republic is the crony capitalism. It’s always been with us, but the societies that have prospered the most have been the ones that apply the law equally instead of picking out who to penalize. The Magna Carta is what set England on a path to ruling the world. The USA followed the same approach, that no one should be above the law. It’s sad to see how those who won’t learn from history are reversing this approach all across our societies.
commented 2016-01-30 11:26:50 -0500
Any pipeline company that participates and funds public hearings into the approval and licensing of new pipeline projects is wasting their time and pissing away shareholder money. The pipeline review process is set up to milk the companies of their money by having them fund the pipeline opponents (who are Liberal supporters) with their presentations and to grandly announce with much fanfare that the project, once the review process is completed,because of the obvious opposition, does not have “social license” to proceed. What a sham! Are corporate leaders that blind to the Trudeau/Butts plan to kill oil sands development?
commented 2016-01-30 09:28:53 -0500
Notely explains in her speach. “This is no time for a money grab”. (what a statement !)
First of all, no time is a good time for a government to implement a money grab.
Secondly, this comment raises the certainty that a “money grab” was contemplated and when oil prices rebound, is that whwn the “money grab” will be most appropriate?
commented 2016-01-30 00:38:15 -0500
Roy i live in Alberta i run into far more people that despise her than like her. Greg is right. Maybe have your life decimated and see how you like it.
commented 2016-01-30 00:37:13 -0500
The dumb cow thinks everyone is as dumb as she is.
commented 2016-01-30 00:29:06 -0500
Greg, how to you know Albertans hate her so much?
commented 2016-01-29 23:55:49 -0500
None of this that she’s doing now was part of her election platform… I have never known anyone to be as hated as Rachel Notley.
And not that pretend hatred… The absolutely raw, unrefined, unmitigated, cold hatred that the people of this province feel for her.
commented 2016-01-29 23:02:09 -0500
One thing that came to light in today’s announcement. (I’m pretty sure I understood her correctly.)
As part of the Royalty frame work; the NDP government plans to reward those companies who can demonstrate improved operating efficiencies.
My first thought was, ‘Since when is it the government’s responsibility to provide incentives for cost containment and efficiencies?’
Assuming that the largest cost to any organization is typically salaries, it began making more sense to me why the NDP would house this idea within the new frame work of the Royalty Review.
This being the case, (my opinion) the NDP are hedging their bets that oil and gas corporations will buy into this and put pressure on employees and contractors to reduce wages and salaries.
This of course would bode well for a great portion of the NDP caucus and most of their voters. It is no surprise to anyone how they feel about people making above average income.
One major downside to this strategy could be oil services companies acquiring their product needs off shore.
This portion of the Royal Review announced today certainly will not satisfy the NDP voters who arrogantly and vehemently demanded a review “cause Alberta wasn’t receiving its fair share”.
More to come I’m sure.
commented 2016-01-29 22:40:47 -0500
Notley doesn’t need to go any further in destroying O&G – the rest of Canada, the Liberals, their fellow travellers will do it for them.

Notley’s work is done; she can call it a career.
commented 2016-01-29 21:40:52 -0500
We may as well all separate anyway, as BC, Manitoba, Ontario, Quebec and all the maritimes with the exception of NFL ( those poor buggers are just so glad to have had some oil revenue of their own and appreciate it), think they are separate countries already. Since when does a province get to dictate whether or not we as a country can get our resources to market. To hell with their ‘conditions’. Christie Clark started with this ‘conditions’ crap, and getting extra compensation as a province for deeming to allow it to get to market. Are we a confederation or not? We sure don’t act like one.
commented 2016-01-29 19:46:39 -0500
If the NDP actually wanted to make policy that reflected their goals…the thing to do would be to hold out an incentive for reduction of royalties based on reduction of emissions.
commented 2016-01-29 19:45:43 -0500
Ezra – the Achilles Heel for the anti-oil lobby is their reason d’etre = AGW! This HOAX is being slowly exposed but still has a long way to go before Canadians can reject the con for what it is – a money and liberties grap by the elitist ruling class. Ontario has proven that the Green Initiative has been a total failure and rift with corruption and Alberta is following down that same FAIL path! What isn’t being exposed is the Agenda 21(the progressive left’s New World Order) that the AGW hoax is being use to justify the enslavement of the masses. I strongly suggest that every story about the climate, oil industry, or the environment has to have the words = “Climate Hoax” in it! No matter which party, politician, activist or truther speaks out, if they talk about CO2 emissions, the comment has to have “Hoax” following closely behind. If the hoax can be exposed to the extent the CC LIE was, we have a chance to STOP the Carbon Tax, and the many Green FAILS that the NDP and Liberals are forcing down our throats without a legitimate fact to back it up! CO2 is not the villain but continues to be used to force Agenda 21 objectives – Stop the BS about CO2 and the the whole hoax will be exposed!!
commented 2016-01-29 19:09:38 -0500
So a province blessed with resource riches elects someone who hates those riches; who has spent their life irrationally marching and protesting against those riches, then gets votes from the people.

It’s like voting for your executioner; to execute your job and your economy.
Would you vote for the daycare that hates your children?
Would you put your money in the bank that hates seeing your investments grow?

There must’ve been some real slim pickin’ for choices there on the ballot form on that last election cycle. :-/

commented 2016-01-29 18:58:50 -0500
I don’t know why the NDP doesn’t just announce their 2 conditions???? IF we can meet their 2 conditions, we will be drowning in oil and there will be pipelines to every port city in Canada…. the simple two NDP conditions are:
1. Elect the NDP, and 2, nationalize the O&G Industry.