Alberta Taxpayers Pay For Mismanagement of Oil and Gas Industry
August 10, 2003

The internal fight in the industry and the resulting “discussions” between industry and the provincial government is about taking the gas before the oil.  As a layman with little knowledge of the “oil patch”, it is my understanding that we have to extract the oil out of the ground before the gas is taken or we lose a comparatively easy and inexpensive way to remove the oil from the ground.  What should be of concern to all people is that the alternative involves using clean water and that is very dangerous given the depletion of the world’s water supply.

The Alberta situation seems fairly easy for me to understand.  What is amazing is that the gas production companies who bought their exploration rights and any gas subsequently found from the Alberta government (the people of Alberta) are not willing to let the commonsense process happen.  They want the Alberta government to “compensate them for having to wait.”  They have purchased the rights to the gas and therefore they believe the people of Alberta should pay them if they have to wait for the gas.  And the Alberta government is currently negotiating to do just that.

From a commonsense point-of-view, this is a no-brainer.  The oil company gets the oil they “bought the rights to extract if they find any” and then the gas company gets the gas they “bought the rights to produced if they find any.” 

To think that the government is negotiating to “have the people of Alberta compensate the gas companies for waiting” to take a resource that belongs to the people of Alberta in the first place is ridiculous.

The solution is simple.  Use the commonsense approach to the harvesting of this non-renewable resource and insure that everything done is in the best interests of the people of Alberta and the future of the province of Alberta, not the oil companies.  The alternatives are unacceptable and irresponsible.

Alberta must maintain an environment that is attractive to industry.  At the same time, the Alberta government must have the leadership, courage and conviction to insure they don’t to “sell the farm” to do it. 

Politicians seem to forget that oil and gas is a non-renewable resource and if the Alberta government doesn’t move towards using the excess revenues for immediate diversification of the Alberta economy, Alberta will become a have-not province in the future.  Forestry and agriculture can’t carry the load.

What do we have to do to get provincial politicians’ attention?  They just don’t get it!  The future of the oil and gas industry in Alberta is already showing that Alberta’s ability to be a player in long-term supply does not exist and our short-term position as a player in the industry is weakening.

This fight within the industry and the government’s involvement and lack of anticipation of the problem definitely shows a lack of leadership and planning on this very important aspect of Alberta’s future.