Tag Archives: Max Fawcett

“This is a sale of a depleting resource that’s owned by the people. Once a barrel of oil goes down the pipeline it’s gone forever. It’s like a farmer selling off his topsoil,” former Premier Peter Lougheed once said.

Let’s Review Oil Royalties and Start Acting Like Owners Again.

Alberta’s new NDP government has taken steps to fulfill one of their key election promises by appointing a panel to ensure Albertans are receiving their fair share from their natural resource wealth through the royalty rates paid by the oil industry to the Alberta government.

Rachel Notley Alberta NDP leader

Rachel Notley

The choice of Alberta Treasury Branches President Dave Mowat, energy economist Peter Tertzakian, former Alberta deputy minister of finance Annette Trimbee, and Mayor of Beaverlodge Leona Hanson to review Albertans royalties should calm any anxiety industry leaders may have had with this process. These are sensible choices for this important review.

Like the panel reviewing Alberta’s climate change strategy, the royalty review panel is stacked with knowledgable appointees who cannot be accused being partisan New Democrats. And while some industry leaders are still uncomfortable with this year’s election results, Mr. Tertzakian has some advice for conservative-connected business leaders.

Peter Tertzakian

Peter Tertzakian

“The industry needs to have more than just an open mind — I think you have to go with forward thinking and that this is an opportunity to get away from business as usual,” Mr. Tertzakian told a business reporting website after Rachel Notley‘s NDP was elected with a majority government on May 2015.

The appointment of Mr. Tertzakian received immediate praise online from two prominent conservative voices –  former Wildrose MLA Heather Forsyth and former Wildrose leader Danielle Smith.

The panel has an important task ahead of it and has a mandate to “optimize” returns to Albertans as owners of the resource, industry investment, diversification opportunities, such as value-added processing, and responsible development of Alberta’s resources.

Bill Hunter, who chaired the 2007 royalty review panel established by former Premier Ed Stelmach, wrote in his final report that “Albertans do not receive their fair share from energy development. Albertans own the resource. The onus is on their government to re-balance the royalty and tax system so that a fair share is collected.”

Marg McCuaig Boyd (photo by Connor Mah)

Marg McCuaig Boyd (photo by Connor Mah)

Nearly a decade after Mr. Hunter penned those words, the responsibility once again falls on Alberta’s government to ensure that Albertans are receiving their fair share from energy development.

It is up to the current panel to consult with Albertans and industry to determine what that proper balance will be.

Part of that balance will be timing, as Energy Minister Marg McCuaig-Boyd told reporters today that any changes to royalties will not be implemented until 2017. And like any other panel review, Ms. McCuaig-Boyd and Ms. Notley have the leeway to ignore any recommendations that might appear to be politically unpalatable or carry too much risk. This is why government’s like to employ these types of panels to review potentially controversial policy changes.

Politicians from the opposition benches have been fiercely critical of NDP plans to review royalties. The WildroseAlberta PartyLiberal and the Progressive Conservative opposition have described the review as “job killing.” A September 3 by-election in Calgary-Foothills has escalated the partisan rhetoric from the opposition, who see a by-election win as a way to discredit the new government’s agenda.

Dave Mowatt

Dave Mowat

But others, like Alberta Oil Magazine editor Max Fawcett, argue that now is the perfect time for a royalty review. Canadian Association of Petroleum Producers president Tim McMillan has said he does not want the government to delay the review, and even Mr. Stelmach has said the review should happen.

Comparisons can be made to a rookie PC government led by Peter Lougheed, which reviewed royalties during its first year in office, to the consternation of industry leaders who had grown accustomed to a comfortable relationship with the old Social Credit government.

“The oil companies, not unexpectedly, are howling – while the natural gas industry is quaking in its boots because the government also has made clear it is going to change its taxes in the fall,” the Ottawa Citizen reported on May 8, 1972.

Ed Stelmach

Ed Stelmach

“This is a sale of a depleting resource that’s owned by the people. Once a barrel of oil goes down the pipeline it’s gone forever. It’s like a farmer selling off his topsoil,” Mr. Lougheed once said while encouraging Albertans to think like owners.

As the owners of the resources, Albertans deserve to know whether we are getting our fair share. But the result of a royalty review is made more important if the government does something meaningful with the funds collected through the rent of our natural resources.

Alberta launched the Alberta Heritage Savings Trust Fund in 1976. Under Mr. Lougheed’s leadership, the Heritage Fund initially received 30% of government resource revenues and was worth $12.7 billion in 1986, when the PCs began a 17 year freeze on new deposits into the fund. The Heritage Fund is now worth only $17.4 billion. Despite an embarrassment of riches during most of its 44-years in power, the old conservative government proved to be poor financial managers once Mr. Lougheed retired.

In their 2015 election platform, the NDP campaigned on the promise that “100% of incremental royalty revenue, above the sums earned by Alberta under the current regime, will be invested into Alberta’s Heritage Fund.

The current downturn in the price of oil will certainly change some of the new government’s short-term plans when the budget is tabled in October 2015, but significant investment in the Heritage Fund when oil prices do rise again will pay off for Albertans in the long-term. And ensuring that the owners – Albertans – are receiving their fair share from energy development, as Mr. Hunter wrote in 2007, will be key to this long-term planning.

alberta politics notes 11/19/2010

After a week-long break, MLAs returned to the Assembly for a week that started with three-sided tailing ponds and ended with an emergency debate on health care.

Edmonton-Meadowlark MLA Raj Sherman at 2010 Premier's Pancake Breakfast.

Emergency Debate on Health Care
Edmonton-Meadowlark PC MLA and parliamentary assistant for Health & Wellness Raj Sherman got the attention he was looking for when he wrote a blunt email to the Premier, and several MLAs, cabinet ministers, and medical colleagues. The letter continued a month long media firestorm on the state of emergency room wait times in Alberta.

As Question Period ended yesterday, Edmonton-Centre MLA Laurie Blakeman succeeded in her bid to hold an emergency debate, which lasted for just over an hour and showcased some of the most passionate debate I have seen in the Assembly this year. This was the second attempt by the opposition during this session to initiate an emergency debate on this topic. A motion to extend the debate during the afternoon was defeated when a number of PC MLAs who did not want to extend their four day week on the Assembly floor (Ron Liepert, Jeff Johnson, and Barry McFarland as tweeted by Liberal caucus Chief of Staff Rick Miller). UPDATE: Mr. Miller has commented below that his tweet was naming the three PC MLAs for not standing in support of the initial vote to have an emergency debate, not to vote against extending the debate past 4:30pm.

MLA Laurie Blakeman initiated the emergency debate.

For Dr. Sherman, the big question is what does his political future hold? After embarrassing the Premier and his caucus on this sensitive file, it is questionable how much longer his colleagues will tolerate an independence streak. With three former PC MLAs having crossed to the Wildrose Alliance in the past year, the Tories need to balance maintaining caucus unity without being too disciplinary with their more independent-minded MLAs. This is a balancing act that has proved difficult in the 68 MLA PC caucus.

New Rural Municipalities Leader
The AAMDC Annual Conference was held this weekend and Bob Barss was elected as their new President. Mr. Barss is the Reeve for the Municipal District of Wainwright No. 61. He was first elected in to Council in 1995 and became Reeve in 1997. Mr. Barss replaces Municipal District of Taber Reeve Don Johnson, who has served in the position since 2004. The conference included speeches from provincial cabinet ministers Hector Goudreau, Rob Renner, Ray Danyluk, Heather Klimchuk, Jack Hayden, Luke Ouellette, and Premier Ed Stelmach.

Liberal Party AGM
The Liberal Party is holding its annual general meeting on November 27 and will elect three of its executive committee members, President, Vice-President (Policy), and Secretary. Edmonton Regional Director Erick Ambtman has declared his intentions to run for President. Current President, Debbie Cavaliere, was appointed on an interim basis after former President Tony Sansotta resigned in July. Ms. Cavaliere will be seeking election as VP (Policy) and current Secretary Nancy Cavanaugh will be seeking re-election for her position.

New NDP Communications Guy
Richard Liebrecht started his new job as the Communications Director for the NDP Caucus this week. Mr. Liebrecht is a former reporter for the Edmonton Sun and editor at the Hinton Parklander. Mr. Liebrecht replaces another former Sun reporter Brookes Merritt, who recently left the NDP Caucus for a job at the Public Affairs Bureau.

The former Libertarian leader wants to carry the Wildrose flag in Calgary-Hays.

Libertarian leader goes Wildrose
Dennis Young is seeking the Wildrose Alliance nomination in Calgary-Hays. The former leader of the Libertarian Party of Canada, Mr. Young earned  265 votes in his 2008 campaign in Calgary-Southwest, which was won by Prime Minister Stephen Harper (Note: Mr. Young is still listed as leader on the Libertarian Party website, but lists himself as the former leader on his campaign website). View the updated list of declared and nominated provincial election candidates.

Distracted drivers
Alberta has a new distracted driving law that will prohibit the use of hand-held cell phones while driving.

Alberta Party (new) media coverage
If you missed the coverage of last weekend’s Alberta Party policy conference, there is no shortage of online news stories and blog posts. Here is a run-down from media and participants of the policy convention and recent Big Listens.

Todd Babiak: Alberta Party hopes to gain foothold with “post-partisan politics”
Dave Berry: Political Crowdsourcing
Samantha Power: Party of the Young
The Unknown Studio Podcast: The Brierley Patch
Mack Male: The Alberta Party’s Big Listen
Edwin Erickson: Moving right along then…
Gerard McLellan: Sunday morning at the Alberta Party policy convention
The Roundhouse: Alberta Party Policy Convention – Part 1
Alberta Party policy convention – Aftermath
Chris Labossiere: Tired and yet inspired
David King: Carpe Diem
Ken Chapman: The Alberta Party is on the Move and Making Waves
Max Fawcett: Mission Impossible?
Duncan Kinney: Feed-in Tariffs, Geothermal and Carbon Disclosure – My experience at the Alberta Party Policy Convention
Jeremy Barretto: Why the Alberta Party is a game changer, not late to the game

Read more in the Alberta Politics Notes archive.