Take a look at the above graph. Alberta oil is already expensive to extract. Oil companies are absolutely global and will shift their spending to lower cost regions if the rates go up.
For most companies every group presents their proposals for the years budget including total return. The companies then allocate their money to the most profitable endeavours first until the budget is spent. (very basic explanation I know) If the costs go up in one region the will shift money to another.
A great example of this is the Petronas/Progress plans for a LNG terminal. They are going to spend their billions on the project that makes the most economical sense whether it is in Canada, Australia or elsewhere. A 1% increase in royalties could easily sway that decision.