September 18, 2007 – The Royalty Review Panel recommends that royalty rates in Alberta be increased. Panel Chairman Bill Hunter: “Albertans do not receive their fair share from energy development and they have not, in fact, been receiving their fair share for some time.”
October 1, 2007 – Auditor General Fred Dunn gives Alberta’s royalty tracking system a failing grade, stating that “the principals of transparency and accountability, I believe, were not followed. I’m not impressed” and that “the department’s monitoring and technical review findings were communicated to decision-makers. The question is: Did they hear or were they listening? At the end of the day, I don’t know, but they chose not to act.”
October 2, 2007 – Energy Minister Mel Knight dresses down the Auditor General for criticizing senior government officials.
October 11, 2007 – NDP call for legislation enshrining royalty changes. CBC reports that “Paul Stanway, Stelmach’s spokesman, said Thursday that the premier will stick with whatever decision the government makes on the royalty report, and that it’s too early to tell if legislation will be necessary.”
October 19, 2007 – Premier Ed Stelmach defends the old royalty regime.
October 23, 2007 – Liberal leader Kevin Taft announces that he would increase royalty rates by 20%.
October 25, 2007 – Stelmach proposes changes to the royalty regime, introducing a plan to increase royalties by 20%, or $1.4 billion annually, beginning in 2009. Finally, Albertans will get start getting their fair share… in 2009.
October 26, 2007 – Energy stocks gain value the day after the royalty increase announced. The sky does not fall.
October 28, 2007 – Alberta PC members support royalty increase.
October 30, 2007 – Former Premier Peter Lougheed endorses the royalty increase.
January 2008 – Oil tops $100 per barrel. People lose all perspective and start talking about permanent $180 per barrel oil.
January 23, 2008 – NDP leader Brian Mason hangs out with Sarah Palin in Alaska and likes their royalty system.
November 2008 – Global Economic Crisis continues. Oil prices drop and hover around $50 per barrel. Perspective returns.
November 18, 2008 – The Government of Alberta inks a new royalty deal with Syncrude.
November 19, 2008 – A year after announcing increases to royalties (starting in 2009), Stelmach announces cuts to royalties, putting Alberta in a position to lose $1.8 Billion in revenues over the next five years.
As a friend of mine put it:
“The ever-changing business rules will ultimately hurt the hard working people of my home province, and will tear apart Alberta’s international reputation as a good place to do business. At this point, I think the Saudi Arabian government can offer more economic certainty than Premier Stelmach.”