EDMONTON, Alberta – Premier Alison Redford and her cabinet are considering changing Alberta’s oil and gas royalty scheme once again. On this incarnation of the royalty structure, she proposes to simplify the mathematics by imposing a 100% royalty on all oil and gas volumes produced in the province of Alberta. Yes. 100%.
Well, after deliberating this proposal with my cabinet for some time now, I think this is what the people of Alberta really need at this time as our provincial deficit and debt continue to spiral out of control. I think it only makes sense to include the NE part of British Columbia that uses the DLS land system in this new royalty regime. A benefit to E&P companies is that calculating net income will be very easy now. Technically, they will all now fall under a new class of organization called Impossible-To-Profit.
According to a recent poll, the roughly 38,000 Albertans (who do not work in the oil and gas industry or any sectors of the economy which support it) are in strong favour of the new structure, because it will mean, “more revenue for the province.”
Robin Caldwell, President and CEO of intermediate producer, Trim Resources, staunchly disagrees,
Well, this sort of royalty structure will make every one of our [‘effing] projects not meet any of our internal economic hurdles, yet we still have a board of directors and demanding investors to keep happy. So this will make it tough. Perhaps my company can get into producing new resources, such as high quality black loam, sod, and Christmas trees. We’ll have to wait and see. But let it be known that I am pissed off.
Bernie Pritchard, who was interviewed on the street, had only the following to say,