Monday, July 23, 2012

The Politics and Finance of Alberta and Alberta Oil.

By 2020 (8 years time) Albertans will have lost $45,138,240,000.00  (Billions) if you continue with the WRP and Conservatives! Speaking to Conservatives; did you sign up for a 45 billion dollar pay out to oil companies while your schools and health care disappear?

We loose on 3 fronts.
1. royalty not collected
2.taxes not collected on income properly due the domestic producers.
3. the loss to our economy as lost disposable incomes suffered by all concerned.

Oil is sold to the parent companies in the US at 75% of the market price.  Shorting the value of the oil crossing the border gives the oil companies an automatic 25% more profit into their accounts  at Alberta Taxpayers expense.   Note also, this is 25% of the earnings we do not collect taxes on as promised by the Cons.  This has been going on for years and in the press throughout.

The Conservatives cannot argue against the fact they are giving taxpayer dollars directly to the oil regime!   These billions going south every day means that oil pays no taxes on them on either side of the border.

Canadian producers have often complained about this huge discount but,  to no avail. 

Our present production is at 307,000 barrels per day. BC and Saskatchewan both sell their oil at Market value,  at a rate of 20% taken on USD .  That means that 61,400 barrels per day of that oil belongs to Alberta taxpayers and we are receiving none; zilch!

Recent figures of 1.037 million barrels per day in conventional oil produced more than triples the figures published here moving them up by 3 time!   That puts the losses to this province up over 8 billion dollars a year    Report on 1 million bbls per day production now.

Valued at 100.00 US per barrel is $6,140,000 USD per day we are being shorted. Extended that is 2.242 Billion dollars per year ripped from Alberta economy!
Alberta Treasury is shorted 448 million dollars in taxes on that amount plus 2.242 billion dollars US in royalty not collected  !  We are presently robbed of more than 2.690  billion dollars a year!

Figures released by the Government to Reuters News Agency indicate an increased output to 512,000 barrels per day by 2020 of which, if we had a decent Government in place, 102,000 barrels would belong to the people of Alberta.   That is Oil is said to be worth 150.00 per barrel at that point in time a very low estimate! 

That is $76,800,000 US dollars per day (5 billion dollars a year!) will be pulled out of the Alberta economy of which  if we continue with   Conservative type Governments!  Alberta will be loosing taxes on that amount being about 15,360,000 dollars US.  

At that time the amount we will be shorted  on royalty not collected and taxes not collect is $5,015,360,000 dollars per year!

Keep in mind here the Alberta Taxpayers have paid for every cent of the building of these plants!  Taxpayers even paid the finance charges!   This is not a huge capital investment by industry as they would have you believe. It is however a major rip of of Alberta's resources! 

In the course of their improvements tar sands companies have built a huge capacity for the generation of electricity surplus  to their needs; available for sale to the US or the  Alberta energy market.  They want Alberta Taxpayers to pay for these lines.  That is the push on power lines.

We are totally exploited in our electrical power.  Every summer without fail the power companies advance our power bills simply sighting "hot weather".  Just as regular California runs out of electrical power and we export to California to meet these summer demands.  Our prices go up, not because of use but to ramp up the prices our companies can charge selling in California. This is all part of the indirect taxation scheme so firmly in place.

The oil industry, way ahead in this rip off, know full well at some point Albertans are going to count  their losses and put in a Government who will look after  the people of Alberta.  They want to have the oil out of this province  before that time and are ramping up production to achieve that goal.  Resist pipelines and other export projects; keep the oil in Alberta until we can change the Government!

The tar sands are estimated to contain 1.7 trillion barrels (270×109 m3) of bitumen in-place, but only 10% of this number was economically recoverable at 2006 technologies and prices.

If the oil companies and Conservatives can rip off that 10% before a government change they are totally happy.   Once that 10% is gone, the price of production ramps up the profit  returns  will drop off supporting an argument finally "we can't afford it"   We have new paid in full plants starting to operate next year.  We will receive nothing from these plants and our contracts read that we are entitled to 25 when the plants are paid.

Here is the mechanics of the Alberta Royalty program.   The total disaster which brings us to this point in time.

The Conservatives are following the plan laid down by Ralph Klein.  They haven't deviated from it at all, regardless of who stands up as premier!   This is why their current tour asking public opinion about health care is worth nothing and will change nothing.

The Wild Rose Party was/is a small right wing group of extremists who caught the Oil Industry eye.  Harper supported them totally throwing his seasoned election types into the WRP as managers during the elections.

The Wild Rose have worked on their extreme positions  for years constantly deluding the people in the LDS church prevalent across southern Alberta.   Their cornerstone  is doing away with the Balance of payments program and they deliberately ignore Alberta's experience with the program.  Their argument is now and always has been "the oil belongs to the oil companies; left wing types are trying to take it away"

Alberta received equalization payments until  1947 and again from 1957 to 1965.  We got our share of the program when we needed it!  It is a Canadian solution so both Harper and the WRP want to end it.
Oil and Harper supported them on the net and in finances and  bannered them as the Ugly Sister of Conservative politics. It worked!   We now have a total circus of nutters for an official opposition.

The Alberta Party is still lurking in the background having no policy or platforms saying they will be whatever Albertans want them to be.  Always taking studies and never committing.  They too have the interest of the oil industry and will be left extremists  depending on what is needed to destabilize the vote in Alberta.  As in no time before us, it is imperative the Liberals and the NDP start working together!

Albertans are led to believe  a change in Government will  damage their employment  and careers.  Nothing could be further from the truth!  With the additional hundreds of billions of dollars in our economy the employment  would be better with far more choices having a massive support for education.

I will cover that in a new post. Cut and paste link into your browser:

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