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Will royalty review results be enough to lure back investors?

Posted on February 2, 2016 by 40 Mile Commentator

After months of waiting with bated breath and nervous anxiety, Alberta Premier Rachel Notley and her NDP government finally released their royalty review report.
Five months and close to close to $3 million after the process began, they decided to do little changes to the royalty review; advice they were given months ago by other political leaders, industry experts, and other stakeholders.
It seems the NDP were looking for every way possible to stick it to the oil and gas industry, and at the end of the day, given the current economic climate, they had no choice but to hold off.
Whether they wanted to or not, they did the right thing. It just took them longer than necessary to reach the conclusion to not upset the apple cart any more than they already have done over the last several months.
As potential investors started announcing their money and projects were going to other provinces, the NDP finally woke up.
Increasing corporate taxes by up to 20 percent will be a hard enough burden for many small and medium sized companies trying to eke out a living.
So, the NDP should not be celebrating. The price of oil will remain low for some time and the loss of the Alberta Advantage (the NDPs introduction of the upcoming carbon tax and corporate tax). Whether future investors choose to come back to Alberta once the price of oil goes up remains to be seen. Any smart business person goes where they will get the best bang for their buck and regardless of the royalty review outcome, it may not be enough of an inticement to lure back those investors.

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