Calgarypuck Forums - The Unofficial Calgary Flames Fan Community - View Single Post - Oilpatch giant makes billion-dollar threat over Alberta royalties

Kerplunk · 09-28-2007, 05:09 PM

[quote=wookie06;1007530]The threats from O&G producers are hollow. The resources are not going anywhere[\quote]
Although the resources are not going anywhere, the cost to extract them isn't really getting any lower. It's likely that if royalties went up, then wells that are just breaking even now (the small, one barrel a day type ones) would be shut down. If a company shuts down 100 of these for a year, your looking at 36500 barrels a year lost, or (at $75 a barrel) about $2737500 a year. That's lost taxable revenue for the government. Increasing the royalties may not equate to increased money for the goverment.

I've also heard (not through the news) that some companies are putting future exploration and drilling plans on hold until the government figures out which way it's going to act on the report.

09-28-2007, 05:09 PM	#13
Kerplunk Powerplay Quarterback Join Date: Mar 2006 Location: Trapped in my own code!! Exp:	[quote=wookie06;1007530]The threats from O&G producers are hollow. The resources are not going anywhere[\quote] Although the resources are not going anywhere, the cost to extract them isn't really getting any lower. It's likely that if royalties went up, then wells that are just breaking even now (the small, one barrel a day type ones) would be shut down. If a company shuts down 100 of these for a year, your looking at 36500 barrels a year lost, or (at $75 a barrel) about $2737500 a year. That's lost taxable revenue for the government. Increasing the royalties may not equate to increased money for the goverment. I've also heard (not through the news) that some companies are putting future exploration and drilling plans on hold until the government figures out which way it's going to act on the report.