WEYBURN, Sask. – Saskatchewan Premier Brad Wall is using the NDP’s pending royalty review in Alberta to pitch his province to the oil industry.
In a speech to an industry audience in Weyburn this week, Wall promised his government has no plans to review the rates it charges oil companies in Saskatchewan.
With oil prices currently hovering around US$60 a barrel, the industry doesn’t need any instability, Wall said.
“We like where royalties are at,” he told reporters covering his address at the Saskatchewan Oil and Gas Recognition Awards. “We want to tell the industry, whatever may be happening in the rest of the country, they can expect royalty stability here.”
Wall noted Saskatchewan benefited through increased investment the last time Alberta reviewed its royalties.
In 2007, a panel report titled Our Fair Share recommended that Alberta increase its royalty take. Industry players were livid when former Progressive Conservative premier Ed Stelmach accepted some of the recommendations. However, after the recession hit, many of the royalty changes were essentially undone in 2009.
The News Democrats under Rachel Notley won last month’s Alberta election on a platform that promised to review royalty rates again.
Notley, whose party won 54 of 87 seats, has pledged to work with the industry, and executives have largely adopted a wait-and-see approach in their public responses.
Wall, whose right-leaning party is opposed by the NDP in the legislature, said Saskatchewan will use the promised review in Alberta to tout investment opportunities in his province.
“We are going to be in Alberta highlighting what we think is the Saskatchewan advantage,” he said, borrowing a phrase often used by Alberta’s PCs.
While Saskatchewan may not review oil royalties any time soon, the same can’t be said for one of the province’s other major resources.
The government announced in its budget this year that it will review potash royalty structures, while spreading tax deductions for capital spending in that industry over a longer period of time.