I love how feckless conservatives try and pretend like a REVIEW was frightening investors and driving away business. It's such bad faith logic, I almost wonder if they even believe themselves.
Capital for investment is finite. If you have the choice to put it in a jurisdiction with known quantities or one that's about to review a mechanism that will directly affect your return, where do you think it goes?
Your post is bad because you don't know what you're talking about.
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Originally Posted by MisterJoji
Johnny eats garbage and isn’t 100% committed.
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Capital for investment is finite. If you have the choice to put it in a jurisdiction with known quantities or one that's about to review a mechanism that will directly affect your return, where do you think it goes?
Your post is bad because you don't know what you're talking about.
He seems to think Jobs are Magic.
The Government cant employ us all.
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Ya, to be clear, this is a move of the "legal parent" so it is no longer a Canadian company, but a US one (that happens to have it main office in Calgary and is listed on TSX).
Effectively impacts its regulatory requirements, and as the press release says, opens them up to additional investors. Most investment funds/pensions have strict rules on the amount of exposure to FPI (foreign private issuer) and/or foreign energy investments they can hold. By becoming a US energy company, they likely can be bought and held in greater volumes by large institutional investors in the US, even though the day to day at the company is unchanged.
So to all the engineers, etc, here, I wouldn't worry. As time passes, if their US ops keep growing, definitely possible the actual HQ activities could move down south.
I suspect investment in Canada shrinks and with that so will their work force. I wouldn't say to not worry per se.
t wasn't an easy decision for the management team at Citadel Drilling. They were a Canadian company, with Canadian workers, and they knew the Canadian oilpatch well.
It wasn't a cheap decision to make, either. Picking up a drilling rig and moving it south of the border would cost about $1 million. Moving just one rig amounts to 57 semi-trailer loads of equipment.
Two years ago, Citadel Drilling began moving its rigs to the U.S. The firm now has all six of its rigs operating in the Permian Basin, which covers part of western Texas and southeastern New Mexico, and more than 100 Canadian workers rotating in and out.
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The collapse in oil prices began five years ago, and the oilpatch has struggled ever since. Even when prices have shown signs of rebounding, the sector hasn't been able to capitalize because of a lack of pipeline capacity to export the crude.
The Alberta government chose to limit oil production to boost prices and reduce storage levels in the province. The move largely achieved those goals, but there have been consequences, including a reduction in drilling activity.
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"The Citadel story is just one of hundreds," said Mark Salkeld, who has worked in the industry in Canada and internationally for more than 35 years. He was previously the president of the Petroleum Services Association of Canada.
"Even the company I work for, CLEANTEK, has expanded into the U.S.," he said. "Frankly, that's saving our bacon."
CLEANTEK Industries leases equipment to the drilling and service sector.
"That's where the opportunity is," he said of the U.S. "It's the smart thing to do if you want to stay in business and survive
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In 2014, before the oil price crash, there were about 900 drilling rigs in Western Canada. Now, there are about 550. Since only about half of those are currently active, Scholz expects more of them will be sent to the U.S.
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Capital for investment is finite. If you have the choice to put it in a jurisdiction with known quantities or one that's about to review a mechanism that will directly affect your return, where do you think it goes?
Your post is bad because you don't know what you're talking about.
Well thank god that for the last year we've had an ultra conservative Premier who is slashing regulations and taxes, and we are now reaping the benefits of these policies as capital comes back to Alberta.
I consider myself corrected, informed, and ultimately educated on the subject. Thank you.
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Last edited by White Out 403; 10-31-2019 at 08:47 AM.
I love how conservatives try and pretend like a REVIEW was frightening investors and driving away business. It's such bad faith logic, I almost wonder if they even believe themselves.
Wow.
"We're going to review your income to determine if we arbitrarily decide that you need all of it. And if we decide that you dont we're going to take some. But make no changes or alternate plans, continue your life as normal."
Better to remain silent and be thought a fool than to speak out and remove all doubt.
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Another reason to provide incentive in the form of tax credits and development funds for new industry to come to Alberta, but those were mostly eliminated.
If I’m not mistaken, many of their assets now reside in the US. Encana, which began as The Alberta Energy Company, had significant assets and a long history in Alberta. They sold a lot of those the last few years.
People should not be blowing this off like it’s no big deal, it is. Moves like this take years to fully feel the effect or to recover from. What happens will depend on the political environment over the next 10 years.
This amount of money and number of companies exiting the Canadian energy sector is staggering.
And make no mistake, this will have long lasting effects on our quality of life here in Alberta and Canada.
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Well thank god that for the last year we've had an ultra conservative Premier who is slashing regulations and taxes, and we are now reaping the benefits of these policies as capital comes back to Alberta.
I consider myself corrected, informed, and ultimately educated on the subject. Thank you.
I mean, you can be as sassy as you want, but you're still wrong. That doesn't change
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Well thank god that for the last year we've had an ultra conservative Premier who is slashing regulations and taxes, and we are now reaping the benefits of these policies as capital comes back to Alberta.
I consider myself corrected, informed, and ultimately educated on the subject. Thank you.
We've been saying it for years. Canada is a hostile business environment and companies and investment will move elsewhere.
And they are.
All you have to do is look at comments like 'thanks Notley' and 'War Room' and the disconnect is palpable.
Albertans may not be whiners, but some of us certainly are masochists.
Some people in this thread are cheerleaders at their own execution.
We yelled it from the rooftops for months after the NDP got elected. And then even more so after the Liberals got in.
The asinine thing is that people in this country think that the capital leaving Canada is constrained only to the energy industry.
This is what happens when a country shows itself to be hostile to investment.
Capital takes the path of least resistance to profit. That's how the world works. Bury your head in the sand and call yourself special, it doesn't change reality.
Canada represents a jurisdiction with too many risks associated with government policies to justify investment, when all else being equal, you can just move your capital somewhere else and make a better and easier return.
I don't know what it is, but people in Canada have this complex where we think we are special and the rest of the world gives a rip about what we have to say.
We aren't. If we don't make it as easy as possible for investors to make the choice to come to our country, they won't. There's plenty of other places for them to make money globally.
This is the impact of the near sighted policies implemented at the provincial and federal level over the past four years. The impact was not immediate, but looking back, I think it is pretty clear what the result has been.
We all like our standard of living in Canada, but some people have lost sight of what it takes to make it a reality.
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Quote:
Originally Posted by Locke
Wow.
"We're going to review your income to determine if we arbitrarily decide that you need all of it. And if we decide that you dont we're going to take some. But make no changes or alternate plans, continue your life as normal."
Better to remain silent and be thought a fool than to speak out and remove all doubt.
Look, I was about as vocal as could be regarding the royalty review when it was announced, I thought it was a terrible idea.
That being said, I think what they came up with was a much better system, and is actually structured in a way to encourage investment in all Alberta basins, not just a chosen few.
Complain all you want about the timing of the review, but doing so without acknowledging that they ultimately got it right and implemented what is ultimately a better system for investment, is either ignorant, or willfully ignoring a positive outcome to make a point.
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Look, I was about as vocal as could be regarding the royalty review when it was announced, I thought it was a terrible idea.
That being said, I think what they came up with was a much better system, and is actually structured in a way to encourage investment in all Alberta basins, not just a chosen few.
Complain all you want about the timing of the review, but doing so without acknowledging that they ultimately got it right and implemented what is ultimately a better system for investment, is either ignorant, or willfully ignoring a positive outcome to make a point.
They may have gotten it right at the end of the day, and of course that's positive. But it's also undeniable that the review itself drove investments elsewhere.
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Look, I was about as vocal as could be regarding the royalty review when it was announced, I thought it was a terrible idea.
That being said, I think what they came up with was a much better system, and is actually structured in a way to encourage investment in all Alberta basins, not just a chosen few.
Complain all you want about the timing of the review, but doing so without acknowledging that they ultimately got it right and implemented what is ultimately a better system for investment, is either ignorant, or willfully ignoring a positive outcome to make a point.
You are understating the uncertainty that was injected, and the capital flight that occurred as a result.
Even if the consensus is that they got the review right, during the process, they scared capital out of the province permanently. Which is something they should have avoided at all costs. Look, I get that they campaigned on a "we need our fair share" platform, and then proceed to do what they said they would in reviewing it.
But the issue is that they took a singularly myopic viewpoint that gave zero consideration to the impact on investor sentiment in our province, at a time when everyone was already reeling from $26/bbl oil.
The capital that left is now a well in North Dakota, or a pipeline in the Permian. And it is only being further augmented every day, and it isn't coming back.
I will forever maintain that the 2015 elections (both federal and provincial) were the most expensive voter temper tantrums in Canadian history.
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Seeing “no impact on Canadian workforce”. Can that be true? How many EnCana employees are there in the city?
I would imagine that's a "right now" type situation. With them moving their HQ to the states in 2020, you'll naturally see Calgary scaled back to a regional office and staffing changes will occur. Support services etc. will all get cut down to bare bones, and only people in Calgary will be directly tied to Canadian projects. Purely speculating that's what will happen, but when it does the layoffs will be significant.
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It seems pretty obvious to me at least that c-69 and c-48 are what is actually driving investment away. There's nothing you can do with your oil here. So why would you invest here? That's on the liberals. We could have flunked along with low oil prices that always change anyway. But there's nothing you can do if there's no distribution for your product.
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so the NDP royalty review permanently scared capital away from Alberta? Perfect excuse! Alberta did nothing wrong, the conservatives in power of this province for 50 or whatever years did nothing wrong, case closed! It was Notley and the NDP.
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