Here is your chance to share your thoughts and ideas on Alberta’s royalty system.

Message from CAPPA’s Government/Emerging Issues/Industry Committee

By now you have heard the Alberta government is conducting a review of royalties.  A review was promised by the NDP as part of their campaign leading up to the May 5 election.  This has been described as a review and not an increase by the Royalty Panel members, therefore, it does not have a pre-determined outcome.

Amending & updating the royalty framework is not a new idea. There have been 17 reviews since mineral rights were transferred from Canada to the province of Alberta in 1930.  Although there have been numerous reviews, not all of them have been public. This is the third review in 8 years (2007, 2010, 2015).

Crown minerals are owned by the people of Alberta.  The government administers and collects royalty on behalf of all Albertans.  Approximately 85% of oil and gas industry activity takes place on Alberta Crown leases.

The Alberta Government collected over $8 billion in royalty in the fiscal year ending March 31, 2015.  Royalties are only one part of the total fiscal load faced by producers.  Producers also pay property taxes, income taxes, excise taxes, payroll taxes, etc.  Royalties should not be considered in isolation from these other taxes. If an overall upward adjustment to royalties is made as a result of the review, it would adversely affect the fiscal burden faced by producers and may ultimately affect their investment decisions and future activity levels.

The Royalty review panel has four members:

  • Dave Mowat, President and CEO of ATB Financial
  • Peter Tertzakian, Chief Energy Economist & Managing Director, ARC Financial Corp.
  • Leona Hanson, Mayor, Town of Beaverlodge, Alberta
  • Annette Trimbee, President and Vice-Chancellor, University of Winnipeg

The panel will provide a report to the Premier/Energy Minister before the end of 2015. The objectives of the panel’s report are:

  • To Provide optimal returns to Albertans as owners of the resource;
  • To continue to encourage industry investment;
  • To encourage diversification opportunities such as value-added processing, innovation or other forms of investment in Alberta;
  • And to support responsible development of the resource.

The panel is using a number of ways to reach Albertans and hear their views:

  1. Public Input
    1. Meetings have been held in Grand Prairie & Fort McMurray
    2. Meetings were also held in Calgary on Oct 5 & Edmonton on Oct 6
  2. Industry input
  3. Social Media
  4. Expert input
  5. Key stakeholder
  6. Alberta Government input

If you did not have a chance to participate in any of these engagement sessions there is still a way for you, as an Albertan, to make a personal contribution to the Panel.  Simply go to the Let’s Talk Royalties website at: www.Letstalkroyalties.ca

Once you land on that page you can register.  Once registered, you will be permitted to record your thoughts and ideas. The Panel reviews the comments.

CAPPA’s Government/Emerging Issues/Industry Committee will be making a submission to the Panel on behalf of the association.

You should too!  CAPPA encourages you, as an Albertan, to check out the www.letstalkroyalties.ca site. Record your personal ideas and share your thoughts about the royalty system with the Panel.   Join the conversation!