January 2008 Issue
READERS' FORUM
Minister Responds to Royalty Review Letter
Editor’s Note: On Oct. 12, APEGGA President John McLeod, P.Eng., sent a
letter to the Alberta Government urging a careful weighing of the evidence in
its review of the royalty system.
Following is the Nov. 6 response from the Hon. Mel Knight, Minister of Energy.
Thank you for your correspondence regarding Alberta’s royalty review. I appreciate you taking the time to share your perspective.
In recent years, Alberta has witnessed unprecedented growth in economic activity, jobs and revenue generated in the energy sector. While this has brought prosperity to our province, Albertans have also asked whether we, as owners, are receiving our fair share from development of our non-renewable energy resources.
Following a thorough review and analysis of the data presented by the Royalty Review Panel, Premier Ed Stelmach determined that we can do better. The New Royalty Framework will maintain a healthy future for an industry that provides tens of thousands of jobs for Albertans and invests billions of dollars in our economy, while ensuring that Albertans receive a fair share from oil and gas development.
The framework was designed to support a fair, predictable and transparent royalty regime, while providing time for industry to adjust to the changes. The framework will provide certainty, and its sensitivity to commodity prices will assure investors that Alberta remains an internationally competitive and stable place to do business.
The New Royalty Framework takes effect in January 2009. A lead time of one year is required to ensure the appropriate legal framework and administrative systems are in place. Changes to at least 11 laws and regulations will be required, including the Mines and Minerals Act, the Petroleum Royalty Regulation, the Oil Sands Royalty Regulation and the Natural Gas Royalty Regulation.
The framework is the result of detailed study and analysis, as well as extensive public and industry consultation. Government thoroughly examined all the facts and data presented by the Royalty Review Panel, which were based on over 300 submissions received from a diverse group that included Alberta residents, municipal leaders and stakeholders in the oil and gas industry.
Nor did we stop listening once the formal consultation process was over. Premier Stelmach appointed the Hon. Ron Stevens, Deputy Premier and Minister of Justice, to provide industry with an opportunity to share its assessments of the impacts of the panel’s recommendations. My department led the technical analysis of the panel’s report to help decision-makers better understand the implications and decisions.
The province also kept communication channels open with Albertans. We received nearly 9,000 submissions via e-mail, telephone and written correspondence after the Royalty Review Panel’s report.
We recognize that high natural gas inventories and resultant low prices have affected exploration and development. While the New Royalty Framework may have some further impact on activity in the short term, the framework will encourage prosperity and stability for the long term. It will help maintain Alberta’s position as a stable and competitive place to do business.
I encourage you to read more about Alberta’s New Royalty Framework at www.alberta.ca. Thank you once again for taking the time to write.
Sincerely yours,
Mel R. Knight
Minister
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Don’t Favour One Race Over Others
Re: APEGGA Aboriginal Awareness Program; and Aboriginal Columns Don’t Belong, by Wendy Dolynny, P.Eng., Readers’ Forum, The PEGG, September 2007.
I fully agree with the writer. In fact I would say any program that singles out Aboriginals is a form of racism. This program places special emphasis on one group of Canadian citizens over another, and APEGGA should distance itself from racism rather than be involved in it.
All Canadians should be treated equally, regardless of ethnic background.
If Aboriginals are getting special assistance because of poverty and homelessness,
so should all other poor people. Otherwise, our assistance programs are purely
racist, favouring one “race” over another (even though all may have
been born on Canadian soil).
From the beginning of Canada’s growth, natives should have been welcomed
and merged into the rest of our society. The valuable aspects of our society
should have been taught to them, and our society should have even incorporated
the valuable aspects of theirs.
Instead, we relegated natives to Indian reserves, and we all know how that has turned out.
APEGGA has no business being involved in racism, unless it is attempting to
stop it.
Bill Bohdan, P.Eng.
Calgary
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Congratulations For Much-Needed Awareness Initiative
Congratulations to APEGGA for publishing this series of articles, and especially for Robert Laboucane’s Why Such Resistance? in the January 2008 PEGG. This seems to me a very effective response to the letter in the September issue claiming that such a topic doesn’t belong in our publication.
As noted in another letter (That’s Exactly Why We Need Aboriginal Awareness, by Kirsten Kae Merle, P.Eng., November 2007), the work of APEGGA members frequently touches on Aboriginal interests and issues, on which many members have tended to hold attitudes similar to those of the government officials criticized in Mr. Laboucane’s article.
If these articles go even part of the way to correct such prejudice and misunderstanding, they will have done a great service to the profession and the province. The low participation in the profession by people of Aboriginal origin should be an embarrassment to us all.
C.R. Neill, P.Eng.
Edmonton