Energy Minister & Royalty Review

[suntan]

[asp integra]

Originally posted by suntan
I'm sure they'll feel better once the NDP puts in a sales tax.

Dear God No!

[Cos]

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[max_boost]

Originally posted by suntan
I'm sure they'll feel better once the NDP puts in a sales tax.

[Maxt]

The only data in play here was the price of oil, every time it dropped 10 bucks they rolled up their scribbling paper and threw it in the garbage. Total about face on what Notley was preaching before the election, and even during her first month or so in government. It's taken awhile but they finally clued in to the financial reality of the industry.

[ExtraSlow]

I believe I said that a low price environment was the perfect time for a royalty review. I think this has proven my point.

[codetrap]

.

[ZenOps]

No difference, same difference, all is good.

[403Gemini]

Best possible outcome I suppose, would have been nice for them to check the numbers before even mentioning "royalty review"

I mean, regardless people would have lost their jobs in Alberta with the low prices - but mentioning royalty review gets investors anxious and quite a few pulled out resulting in more unnecessary job losses. Furthermore I wasn't overly impressed with her saying "Now is not the time for a 'cash grab' " , then during the Q&A very first question was if oil went up to $100 barrel tomorrow, would the review change, and she skirted that question without really answering it.

Short answer: yes.

Can't imagine that would sit well with investors either.

Oh well, best possible outcome at this point of the juncture.

[rage2]

That doesn't make any sense. Royalty rates have always been on a sliding scale based on prices. If it was unfair at high prices changes now wouldn't be a cash grab.

[suntan]

Originally posted by codetrap




I don't know suntan, did people forget what they said? I can understand why you would forget that, it doesn't fit with your narrative on the NDP.

Rachel Notley, May 2015

LOL, okay.

READ THIS:

http://calgaryherald.com/opinion/col...and-shes-right

Good fucking Christ.

[phreezee]

Originally posted by 16hypen3sp
I'm happy with the result.

Lots of left-of-centre supporters on twitter certainly are not.

Yup the communists will bring it up with Notley at their next regularly scheduled meeting lol. Even they call it a U turn.

http://www.calgarysun.com/2016/01/30...royalty-u-turn

[16hypen3sp]

Originally posted by phreezee


Yup the communists will bring it up with Notley at their next regularly scheduled meeting lol. Even they call it a U turn.

http://www.calgarysun.com/2016/01/30...royalty-u-turn

Gil McGowan is a weasel.

[Seth1968]

So Notlley has come to her senses on the royalty review.

Thing is, she has already put in place the moronic "feel good" tax.

[codetrap]

.

[Xtrema]

Originally posted by rage2
That doesn't make any sense. Royalty rates have always been on a sliding scale based on prices. If it was unfair at high prices changes now wouldn't be a cash grab.

I thought that's what this review will do. But it doesn't.

One of 2 things happened:

a) the review committee is stacked with industry insiders so the outcome is fixed.

b) Notley really can't take another hit because there's no way in hell she's can turn the economy around before next election.

[borN]

Originally posted by Feruk
Am I missing something, or did they not actually LOWER the rates on conventional drilling? From what I remember it was 5% until D&C payout OR the first 18 months, whichever comes sooner. Now it's just 5% until D&C payout. That's a reduction, no? Disclosure: I don't drill wells in Alberta so this is just from memory.

Also, Saskatchewan's still cheaper!

Half right, AB royalty rates under the current system are based on a function of price and volume, which is determined by your TVD. Shallower wells will get 18 months and a 50,000 boe ceiling, deeper wells can get more.

The new system is all about revenue minus cost, so what the general public doesn't realize is that it's beneficial in a low price environment but will take more (compared to old regime) when prices rise. Gas producers and companies who drill oil wells with high associated gas benefit quite a bit from the new system. Peyto, for instance, drills shallow Spirit River wells which hit the 500,000 mcf threshold pretty quickly; now, with the new system based on payout, they'd be able to implement the 5% holiday for much longer (assuming NGDDP runs out)

TBH I think the review is beneficial (so far). The focus on revenue/payouts with an annual cost index should allow for more flexibility in a low oil market. Also the old system was prehistoric in its calculations, a lot of the overlapping holidays were set to expire this year (like the natural gas deep drilling credit), it's nice now that all hydrocarbons are harmonized.

[phreezee]

Originally posted by Xtrema


I thought that's what this review will do. But it doesn't.

One of 2 things happened:

a) the review committee is stacked with industry insiders so the outcome is fixed.

b) Notley really can't take another hit because there's no way in hell she's can turn the economy around before next election.

It's (B) as the chair of the review commitee, Dave Mowat, is an Al Gore prodigy from Vancouver.
http://www.theglobeandmail.com/repor...article676853/

There were complaints of stacking regarding his appointment : http://canadianmarketreview.com/2015...ed-by-al-gore/

[01RedDX]

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[phreezee]

The emergency buffer went to Quebec. I'm shocked there isn't a Denis Coderre thread on here yet.