The Reason For Alberta's Deficit-Big Oil

Just like back in the nineties when Alberta gave big tax breaks to big oil, we went into a deficit. And Deja Vu if it didn't happen again.

Canadian Energy Research Institute (CERI) paints a picture of declining production and royalties from Alberta's natural gas industry for the rest of the decade, but sharply rising oilsands royalties.

Royalties from natural gas and the oilsands totalled more than $8.8 billion in 2009, but just over $4.6 billion in 2010 -a big cause of the provincial deficit.

"The government is running a province which assumes they will take in $6 billion to $8 billion a year, and this is not happening," CERI CEO Peter Howard said.

Premier Ed Stelmach has said the province aims to balance its budget by 2013. CERI's estimates suggest that will be a challenge if they are depending on royalties.

The institute estimates Alberta will be back to 2009 royalty levels by about 2016, when oilsands royalties will be more than $7.2 billion, with just $1.1 billion coming from natural gas.

Yep Big Oil gets Royalty breaks that resulted in the deficit and schools get cuts!

Alberta Premier Ed Stelmach says school boards may have to "hold some of their labour costs low" in coming years as the province looks to rebuild its coffers, but critics blame the Tory government for looming teacher layoffs.

Read more: http://www.calgaryherald.com/business/Provincial+education+funding+falls+short/4494419/story.html#ixzz1HcKHRDNU

Forward to the Past

Well excuse me if I am not surprised that Steady Eddie Alberta's CEO produced a TV show last night that announced nothing new. In fact while some folks bemoan the premier for not being Ralph Klein, including King Ralph his-self, Steady Eddie is living up to his name.

In fact he is the ghost of the Tories Past, the actions of his government are just a rehash of Klein's fiscal renovation, of the 1990's. The government is cutting hospital beds and freezing hiring of nurses and doctors, just as Klein did. The are cutting back funding to schools, just as Klein did. They are cutting funding to post secondary institutions just as Klein did. They are calling for a wage freeze for two years for all public sector workers just as Klein did. The debt and deficit hysteria that launched the Klein regime has returned like Marley's ghost to haunt the Alberta Government. Having no plan Steady Eddie returns to the past to find solutions to the Tories Made In Alberta Recession.

Blaming the economic crash of last year for Alberta's current deficit is of course par for the course, all governments have used the crash to explain away their economic mistakes. But in Alberta that crash should have been expected, since we have experienced boom and busts before, and those who had like former Premier Peter Lougheed warned that the Alberta Government led by his old party, had no plan to deal with the boom. And of course it had no
plan to deal with a crash.

The failure to invest the Heritage Trust fund or to fund it adequately led to the current deficit. And yet those in charge of investing both the Trust fund and the new AIMCO investment fund (made up of your and my public sector pension funds) lost the province billions, that now make up part of the current deficit. It was this investment failure that has cost the province much including outrageous buy outs and bonuses to these same fund managers.

The province's Heritage Savings Trust Fund lost the $3 billion between March 2008 and March 2009 in the economic downturn, and currently sits at $14.3 billion. The record loss sent Alberta into a deficit for the first time in 15 years. It was the biggest loss in the fund's 33-year history.

two AIMCo executives earned a combination of more than $5 million last year even as the funds they managed -- including the Heritage Savings Trust Fund -- lost more than $7 billion.

The collapse of oil and gas prices of course added to the deficit but not to the degree that the bad investments of our surpluses did. In fact the decline in natural gas production in the province began back in 2001 and is something that could be planned for, if you had a government that was not adverse to planning.

The problem, however, is that production in the Western Canadian Sedimentary Basin (WCSB) is declining. Production peaked in 2001; the vast majority of the country's natural gas is produced in the WCSB. According to Canada's National Energy Board (NEB), Canada's marketable production peaked around 17 Bcf/day in 2001.

Sadly, no amount of drilling is going to reverse the decline. Production declined in 2005, despite having a record number of well completions in the WSCB. Take a look for yourself:

If we take a look back, 2005 should have been a huge year for Canadian natural gas. That year, we saw the most active Atlantic hurricane season in recorded history. Fifteen hurricanes blew past us. Five became Category 4 hurricanes and four reached Category 5, including Katrina and Wilma.

That same year, Canada imported 3.7 Tcf of natural gas to the U.S. However, Canadian production of marketable natural gas fell 1.7%, compared to 2001 levels. According to NEB projections for 2009, natural gas production will sit at 5.5 Tcf — 12% lower than in 2001.

Add to that the expansion of infrastructure projects, that under Klein had been halted, as labour costs increased during the boom and you have another reason for the deficit.

Finally we have the creation of Hospital Boards, which were to have been publicly elected and were for one term and then when to0 many liberals and dippers were elected the boards were fired by Klein and replaced with Tory hacks. Steady Eddie's first act as Premier was to follow in Klein's footsteps, firing the regional boards and forming a super board, the cost of which was again payouts resulting in the new super board having a half billion dollar deficit.


And while Steady Eddie announced a wage freeze for senior government managers it means little when in fact these same managers racked in bonuses worth $6.7 million last year. And we suspect that even if he follows through with MLA and cabinet salary freezes its after the cabinet gave itself and the Premier a 34% increase last year.

The other reason for the deficit is that Alberta is business friendly. The cost of doing business in this province is nil, zilch, nada. The working class taxpayers in Alberta shoulder the burden of business costs. And thanks to the generous tax breaks to business the burden of the deficit is shouldered by you and me, and the solution that some are suggesting is the dreaded of all taxes the sales tax.

The Progressive Conservative government, in power since 1971, has long had a hands-off approach to business. Foreign investors have long been attracted by the lack of sales, payroll or capital taxes, low income taxes and competitive corporate taxes, at 29 per cent and dropping to 25 per cent by 2012. Despite a current deficit, overall net direct and indirect debt is low, totalling C$1bn or 0.3 per cent of GDP on March 31, according to a recent Moody’s report that gave Alberta a triple-A debt rating.

Like the mythical debt and deficit crisis of the Klein years this too is a short term recession, with a temporary deficit. And like then the deficit will be paid off by cutting public sector funding and freezing wages rather than taxing the capitalists. Nothing new here just as there is nothing new with the Tired Old Tories still in power.

SEE:

Your Pension Plan At Work

P3

Your Pension Dollars At Work

P3= Public Pension Partnerships

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Caanda's Economic Engine Runs Out Of Oil

The overheated Alberta economy has screeched to a halt. And it does not look like the 'engine of Canada's economy' will be saving the country from recession anytime soon. So while manufacturing declines in Ontario, especially auto manufacturing, the result will mean even further decline in the need for gas and oil.
Opp's didn't plan for that did we. Of course not Alberta politicians provincially and federally oppose any concept of 'economic planning'.
And its not like we haven't been through all this before! Alberta Oil Jobs Evaporating
Despite the provincial governments head in the sand approach to oil development Albertans are speaking out, even as the oil economy bottoms out. Petro-Canada's planned pipeline bad for Alberta
And once again Alberta comes calling to Ottawa to bail it out!!! And of course the Alberta based Harpocrites are only to willing to oblige. But don't worry this is typical Conservative hype, they are simpy reannouncing previous commitments to capital investment.

Crisis forces Alberta to consider red ink
Opposition parties have been warning for years that the Tory government's spending was out of control, and that it was not doing enough to save the eye-popping surpluses it was reaping from soaring oil and natural-gas royalties. This year's surplus is expected to be $2-billion, down from the record of $8.6-billion in 2005-06.In 2007, the finance minister of the day, Lyle Oberg, speculated a deficit was possible if the province could not rein in its runaway spending. Since 2005-06, total government spending has jumped at least 32 per cent and per capita spending has been higher than that of any other provincial government.

Energy prices blamed as Alberta faces first deficit in 15 years

Alberta's decelerating energy sector can no longer be relied on to be the sole engine driving the province's economy, says a report issued yesterday by the Royal Bank of Canada. "While our new forecast for the provincial economy still reflects some degree of vigour, it does show a fair amount of steam seeping out of Alberta's engine," said Provincial Outlook, penned by economists Robert Hogue and Paul Ferley. The most visible example of the fading vigour is the delay or outright cancellation of several upgrader projects worth approximately $45 billion, as well as plans to scale back drilling because of low natural gas prices, the reports says. RBC has revised its GDP forecast to 2.1% for next year, down from a previous estimate of 3%.

Alberta inflation takes breather at 2.1 per cent
ATB Financial senior economist Todd Hirsch attributed the price jump in fruits and veggies in part to a weaker Canadian dollar."Alberta's inflation figures are being swept lower by falling commodity prices, especially crude oil and gasoline, but also by softer consumer demand," he said. Still, Canada's inflation was two per cent in November, the first time in two months that Alberta's inflation edged higher than the nation's.

Nearly across the board, oil companies have begun cutting spending. A survey by Barclays Capital found 2009 capital budgets were 12% lower than 2008 spending plans, and some believe they might head lower. Budgets in the U.S. and Canada are being cut the most, as projects in the high-cost oil-sands and unconventional natural-gas fields now make less economic sense. Companies such as Chevron Corp. and ConocoPhillips have delayed announcing budgets to spend more time assessing the market.

Alberta projects get$1B boost
PM commits gas tax funds to rebuilding infrastructure
A day after announcing it would sink deep into the red, the Harper government waved around a lot of green Friday in Conservative Alberta.On the heels of declaring it would run deficits totalling tens of billions of dollars over the next few years, Ottawa announced about $1 billion worth of previously committed infrastructure funding for projects in Wild Rose Country.The capital dollars come from earlier federal funding pledges, including $100 million to twin the Trans-Canada Highway near Lake Louise--with construction officially commencing today --and a promise by the Harper government to permanently allocate gas tax dollars to infrastructure.

Ottawa to give Alberta nearly $800-million
Calgary -- In a bid to keep Albertans working and help municipalities keep up with growing infrastructure demands, Ottawa announced yesterday it will pump more than $798-million into the province between 2010 and 2014.The extension to the federal gas-tax funding agreement could see cash earmarked for projects involving public transit, roads, water and waste disposal. Federal Labour Minister Rona Ambrose said the money will provide a "strong stimulus for the economy."

SEE:
Alberta Loses Billions
Recession Hits Alberta
Capitalism Caps Tarsands Expansion


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Alberta Loses Billions

Poor fiscal management is the heritage of the Tired Old Tories....as in Heritage Trust Fund lossing billions in investment interest and the Alberta Treasury Branches (the Socred Bank)losing billions in the toxic paper loans. Anywhere else heads would roll. Howerver in the province of the one party state those in charge just keep on keeping on, including rewarding themselves for bad management decisions.

And the Alberta Treasury Branch brass - who showered themselves with hefty bonuses last year - are getting their ducks for an "additional provision" to cover the toxic asset-backed commercial paper they lost Albertans' money on.

ATB Financial has made an additional $55.5-million provision for potential losses on its holdings of asset-backed commercial paper, bringing its total provisions for possible ABCP losses to $308.6 million.ATB's net income for the quarter ended Sept. 30 fell to $5.7 million, the financial services company said Friday in its latest quarterly report. That's down from $8.5 million in the year earlier period when ATB took a $77.6-million provision for potential losses for its holdings of asset-backed commercial paper. ATB's $1.14-billion principal investment in ABCP will be converted to longer-term notes that reach maturity in six to nine years. ATB will revalue the restructured ABCP investment upon closing. "Times are getting tougher, even in resilient economies such as Alberta's, and interest rate conditions and uncertainty in the marketplace continue to impact our business. But our continued growth and positive results mean Albertans can be confident in ATB," said Dave Mowat, ATB's President and CEO.

Knowing full well that Alberta taxpayers will bail you out.

SEE:

Recession Hits Alberta

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Recession Hits Alberta

I love it when folks who are in charge of the eonomy claim that they didn't see the recession coming, or they didn't expect it or they are shocked by it.

There is little doubt this week's developments signalled a change in the economic conditions affecting the province -- and in the messages coming from the Stelmach government, said political scientist Peter McCormick of the University of Lethbridge.
"I do think Alberta thought it was flying pretty high -- 'Recessions might hit lesser economies but they can't hurt us because we're oil, and oil never hurts,' " he said Friday."This is completely new territory for the government."

Oh please Peter gimme a break. There was the recession and oil crash of the seventies when the Tired Old Tories first took power. Then there was the oil boom and crash of the late seventies and early eighties which occured while the rest of Canada went into recession, by 1982 the oil market collapsed and Alberta followed the rest of the country into a downward spiral. Then there was the recession and debt/deficit crisis of the ninties. And through out it all the Tired Old Tories were in charge. So this ain't new territory.

Indeed the rose coloured blinders of the oil boom that the Tired Old Tories wear are the same ones they wore in the seventies and eighties. And now the recession has hit Alberta, we still have a budget surplus, just as we did in the ninties. But like the ninties, watch for the Tired Old Tories to start belt tightening and attacking the public sector while giving royalty holidays to their pals in Big Oil.

Indeed, the economic woes have hit on a number of fronts: the stock market slide has hammered Calgary-based petroleum producers; Alberta's housing market is slowing; retail sales are down; a handful of jobs have been cut.
While Ontario's manufacturing sector has been feeling the pain for months, the downturn in commodity markets -- particularly for crude oil -- is squeezing Alberta.
"We have been living in a bit of a dream world for the last little while. Things have not been well in other parts of the country," noted University of Calgary economist Ken McKenzie. "Until recently, we've been relatively removed from that because of high oil prices."
Much of the concern stems from just how quickly economic conditions, including commodity markets, have changed.
Resource revenue is still on pace this year for a record $14.6 billion, but it's about $4.3 billion less than what was predicted only three months ago.
Banks predict the Alberta economy will grow 1.9 per cent this year, gearing down to 0.3 per cent in 2009 -- the slowest since 1986.
"A $2-billion surplus is not a catastrophe compared to other provinces," Bernard said Friday. "There are a lot of positives, I think, for the Alberta economy, but for sure the drop in commodity prices is going to hurt."
McCormick agrees the province is faring better than other parts of the country where deficits are now being calculated. However, the government is trying to manage expectations by talking about tough times ahead.
"It's directed at universities, hospitals, school boards and government employees who are thinking about salary negotiations coming up -- that's who they are talking to," he said. "They are trying to get rid of boom-talk and boom-mentality now."

Alberta veers on royalties
Financial crisis forces energy-rich province to back down on its demands for a "fair share" from the development of its resources; New transitional rate for oil and gas wells will cost government $1.8-billion over the next five years.

It's the second time this year Alberta backtracks on the new policy, launched when energy prices were thought to rise forever. Last April, it backed off royalty increases affecting gas wells deeper than 2,500 metres and oil wells deeper than 2,000 metres.
The changes won't be the last.

SEE:
Black Gold
Steady Eddie Runs Away
Lougheed Spanks Klein
Don Getty's Legacy
You Won't Have Me To Kick Around
Lack of Planning Created Skills Shortage in Alberta
Laundry Workers Fight Privatization


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Funding A Myth

While the petro economy in Alberta gets bashed the Tired Old Tories plow ahead with funding for the mythical carbon capture and storage. What a waste of money.And this from a government that supposedly is not in the business of funding business, picking winners and losers. Well carbon capture and storage is not just a loser, it does not exist yet. Call it funding the Emperors New Clothes instead of saving for a rainy day. Clean Coal technology is a right wing fantasy.

However, in the face of a $6.5-billion surplus shortfall and multibillion-dollar "green" spending commitments made when oil peaked at $147 US a barrel in July, Finance Minister Iris Evans said Tuesday she doesn't expect there will be anything left to save.
In fact, the province's new fiscal update revealed the heritage fund's value has fallen to $15.8 billion from $17.1 billion, due to the financial market meltdown.
Several government critics are calling the government's decision to push ahead with $2 billion for technology to capture and store greenhouse gas emissions foolhardy.
NDP Leader Brian Mason said the province should inject those public dollars into savings, not hand over seed money to help the energy industry cut its carbon footprint.
"That is just a tiny drop in the bucket for an unproven technology that essentially landfills carbon, rather than focussing on real reductions in carbon emissions," Mason charged.
Evans, however, defended the spending, saying it will help strengthen the province's environmental reputation. Alberta produces more greenhouse gas emissions than any other province.
"Our $2 billion towards our carbon capture and storage is a necessary expenditure to show the world, to show Canada, that we're serious about environment and we're going to get emissions under control," Evans said

Now if only we had those oil and gas royalties in place our provincial budget would not have taken such a hit

SEE:

Harpers Alberta Green Plan

Between Coal and a Hard Place

King Coal

Coal=Cancer

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Steady Eddie Runs Away

Alberta's farmer CEO Ed Stelmach has no plan to deal with economic meltdown so what does he do instead skips the first ministers meeting for an all expenses paid junket to Europe. Guess he missed the news that this is a global crisis and that Europe ain't open for business its businesses are collapsing. And typically the Tired Old Tories have no plan. Instead they put their heads in the sand and hope no-one notices their arses are in the air.


Alta. premier to skip first ministers' meeting
Trish Audette , Canwest News ServicePublished: Monday, November 03, 2008
EDMONTON - Alberta Premier Ed Stelmach is skipping national economic discussions in Ottawa next week in favour of going to Europe on a trade mission.
Stelmach explained Monday that his presence at the first ministers' meeting, hosted by Prime Minister Stephen Harper, is unnecessary. The premier said organizers rejected having him connect to the Ottawa meeting by phone, so Alberta is sending a senior cabinet minister.
"We'll clearly identify the areas that we're concerned about," said Stelmach. "One of them is income trusts and another is where they cancelled all of the accelerated capital cost allowances for the oil and gas industry."

Premier needs to deliver plan that will restore hope
The premier has been disappointingly mum on his plans to restore confidence . . .
Danielle Smith, For The Calgary HeraldPublished: Tuesday, November 04, 2008
On Monday, the finance ministers met to talk about the next steps the federal government will take to address the pending economic crisis. What Premier Ed Stelmach now needs to do is set a date to provide an economic update of his own, so Albertans know what he intends to do about it.
The premier has been disappointingly mum on his plans to restore confidence among consumers and business owners. Meanwhile, Alberta is not likely to avoid the effects of what appears to be the beginning of a global economic slowdown.
Business confidence is at the lowest levels we've seen in nearly two decades.
For the last four weeks, starting on Oct. 6, CFIB has surveyed members on a weekly basis to get their views on how they expect the economy to perform over the next 12 months. The results are sobering.
Each week the small business outlook has looked a little dimmer, as massive shifts in commodity prices and the shrinking availability of credit disrupt investment plans. For the first time, the index is now virtually equivalent to its previous record low -- found in mid-1990 -- a time that coincided with a protracted recession.
For the last four weeks, starting on Oct. 6, CFIB has surveyed members on a weekly basis to get their views on how they expect the economy to perform over the next 12 months. The results are sobering.
Each week the small business outlook has looked a little dimmer, as massive shifts in commodity prices and the shrinking availability of credit disrupt investment plans. For the first time, the index is now virtually equivalent to its previous record low -- found in mid-1990 -- a time that coincided with a protracted recession.
But the most important question Taft levelled, which still appears to have no clear answer, is: "As the world economy staggers to a halt, what is this government's plan to protect the wealth and jobs of Albertans?"
Stelmach responded that he would dip into the $7.7 billion stability fund if he needed to, but that doesn't address the core problem. The core problem is the Alberta government spends too much.
This year, the province increased operating spending by 9.7 per cent and capital spending by 22 per cent.
Not long after the budget was delivered, the province threw out its surplus management strategy (which was supposed to dedicate one-third of surpluses to infrastructure, one-third to infrastructure maintenance, and one-third to savings) and announced it would spend an additional $4 billion, on carbon sequestration and public transit.


Tories 'handing' U.S. oilsands upgrading jobs
Premier blames federal government
Renata D'Aliesio, Calgary HeraldPublished: Tuesday, November 04, 2008
Opposition leaders accused Alberta's premier on Monday of standing idly by as the United States siphons oilsands upgrading jobs from the province.
In question period, Liberal boss Kevin Taft seized on new industry warnings that Alberta is on track to upgrade only half of its bitumen production, far short of Premier Ed Stelmach's goal of 75 per cent.
Taft listed a litany of American upgrader projects designed to process the province's tar-like bitumen, including plans slated for Indiana, Minnesota and Montana.
He said the Alberta government should be worried that $30 billion worth of oilsands projects, including upgraders and processing plants, has been shelved due to the global financial turmoil.
"This government is on the brink of handing control of Alberta's wealth to the United States," Taft charged.


Unintended consequences: discounted Alberta land
Crescent Point says royalties deflated prices
Dan Healing, Calgary HeraldPublished: Saturday, October 25, 2008
It's a bold investment strategy tinged with more than a little irony -- Calgary oil executive Scott Saxberg, a vocal opponent of higher Alberta oil royalties unveiled a year ago this week, says his Saskatchewan-focused company is going to aggressively bid for land rights in this province.
"We are now looking at lands in Alberta because we believe, based on the way royalty rules are, Alberta is basically giving away their land for free," the president and chief executive of Crescent Point Energy Trust told the Herald in an interview this week.



SEE

The Economist On Alberta's Fair Share
Still not getting our due
Ed's Politics Of Fear
Nationalize The Oil Patch
Royalties Pay For Jobs

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Pallin's Pipeline

Sarah Pallin's American nativist politics ends when it comes to oil. The Alaskan Govenor is in the pocket of one of Canada's oldest and leading Pipeline companies; TransCanada Pipelines. But shhhh don't tell anyone. Her Drill Baby Drill rhetoric belies the fact that you can drill all you want in Alaska but the point is to get the oil and gas to a refinery. And Alaska for all its ground assets does not have refinering capacity, so that oil and gas has to get shipped south. And who will do the shipping? TransCanada Pipelines, tying Alaska into its Keystone pipeline project.

The controversial pipeline will ship bitumen from the Tarsands south to the Gulf Coast for refining. In Alberta, and in fact across Canada, the pipeline is controversial for several reasons, one is it runs through disputed Lubicon Cree land, and secondly it shows that we remain hewers of coal and drawers of oil, rather than having true energy independence by doing secondary and tertiary production; refining here. Unlike Alaska, Alberta has refineries, and refining capacity.But thanks to TransCanada's cozy relationship to the Stelmach regime, like its cozy relationship with Pallin, we and the Alaskans get screwed.

During the election Harper announced that if elected he would restrict exports of bitumen, the Stelmach regime remained uncharacteristically silent over the issue. Usually Ottawa intrusion into Alberta's energy patch would elicit a hue and cry of outrage with the usual rantings about the NEP. However Harpers move was to assure Americans that Canada has continues to view them as the primary preferred customer for our oil.

With the current fiscal meltdown most of the refining expansion planned for Upgrader Alley in Alberta are now on hold which gives carte blanche to TransCanada to ship our oil and jobs south . As Ross Perot once said; can you hear that giant sucking sound as Alberta and Alaska oil jobs go south?

As Ms. Palin takes to the road to campaign with Mr. McCain, invoking the pipeline as a major victory, some Alaska lawmakers who initially endorsed her plan now believe it was a mistake. State Senator Bert Stedman, a Republican who is co-chairman of the finance committee, said that in its contract with the chosen developer, TransCanada, the state bargained away too much leverage with little guarantee of success.

Of the five companies that eventually bid, Ms. Palin’s administration chose TransCanada Pipelines, which operates 36,500 miles of pipeline across North America. TransCanada had previously tried to negotiate a pipeline deal with the Murkowski administration, but was sidelined by the governor in favor of the big oil companies, some officials who were involved in the talks said. That contributed to the rift that led to the departures of Mr. Irwin, Ms. Rutherford and five others from the state Department of Natural Resources.
The proposal that TransCanada negotiated with the Murkowski administration was structured differently from the current one and had no provision for a $500 million state subsidy, said two people who reviewed it and who spoke on condition of anonymity because the proposal remains confidential.
Of the Palin aides familiar with TransCanada from those earlier negotiations, Ms. Rutherford had an unusually close connection. For 10 months in 2003, she was a partner in a consulting and lobbying firm whose clients included Foothills Pipe Lines Ltd., a subsidiary of TransCanada.
Ms. Rutherford said in an interview that after TransCanada submitted its pipeline proposal to the Palin administration, she and the governor never discussed whether her role on the team might be viewed as improper or give the appearance of a conflict of interest.
Ms. Rutherford, who said she had not lobbied for Foothills but had done research and analysis, stated that she was not one of the pipeline team members who recommended a developer to Ms. Palin. That was done by Mr. Irwin and Patrick S. Galvin, the commissioner of the Department of Revenue, she said.

TransCanada is already building the $5.2-billion Keystone pipeline, which will carry 590,000 barrels a day from Hardisty, Alta., to refinery hubs in Illinois and Oklahoma from 2009. The expansion will take an extra 500,000 barrels a day to refineries in Houston and Port Arthur, Tex.
As well as the confirmed supplies and the possible construction delay, TransCanada said it has increased its stake in Keystone and the expansion as its partner, ConocoPhillips Corp. of Houston, has reduced its share from 50 per cent to 20.1 per cent. TransCanada now has 79.9 per cent of the pipeline, although shippers will have an option to take a 15-per-cent stake.
ConocoPhillips spokesman Bill Graham said the company is still committed to Keystone, and will be a major shipper on the pipeline, but he wouldn't comment on why the company had reduced its interest.

Currently, Alberta exports 500,000 barrels of bitumen daily to the U.S., about 40 per cent of total production of the tar-like substance from the oilsands. That will rise to one million barrels a day by 2010 when two new pipelines, the Alberta Clipper and Keystone pipelines, take bitumen to Texas and Illinois respectively.
Bitumen must be upgraded into heavy oil before it can be sent to refineries to be made into gasoline and other fuels.
Stringham disputed the suggestion that oil companies are sending bitumen south for upgrading to avoid Canada's greenhouse gas emission standards, which come into effect in 2010.
Everyone expects the U.S will have some similar standards soon, he says.
Besides, the decision on where to build an upgrader for bitumen is based on economics, not the environment, says Stringham. In some ways, Alberta is a preferred place to build an upgrader, given the low taxes and stable political environment, though high labour costs are a problem these days.

But building bitumen upgraders isn't easy in the Edmonton region's upgrader alley.
Last month, the BA Heartland upgrader, partly completed near Fort Saskatchewan, was suddenly mothballed. The credit crisis in the U.S. was the major reason cited by the company for closing down the project at this time.
The very same day, however, ConocoPhillips and Calgary-based Encana began work in the U.S. on a $3.6-billion refinery retrofit to handle Alberta bitumen flowing to Illinois.

No wonder, then, that Harper's policy to keep the bitumen here was hailed as good news in the Fort Saskatchewan area where there are plans for a dozen upgraders. "Our group feels it's a very progressive move," said Neil Shelly, executive director of Alberta's Heartland Industrial area.
"It levels the playing field for us because we will be capturing carbon dioxide at the plants in this area, and the U.S. does not have those requirements that entail an additional cost." Gil McGowan, president of the Alberta Federation of Labour, agrees those upgrading jobs should stay in Canada.
But he doesn't hold out much hope that Harper's bitumen policy will actually reduce the flow of jobs or bitumen down the pipeline.
In fact, McGowan suggests that Harper is sending a reassuring message across the border that energy hungry America will remain Canada's preferred customer and that China, with its lower environmental standards, will be on the prohibited list.
Even if the Democrats win the U.S. election, they too will want a continental energy policy, as that's the only way to reduce U.S. dependence on Venezuelan and Middle East oil.
"He's sending a signal to Washington and Houston that if he is prime minister, Canada will continue the continental energy system," says McGowan "It's the worst kind of election promise. ... He's able to give the impression he was doing something to protect jobs, without taking concrete action.
"What this really does is tie the hands of Alberta producers from looking for other customers." Pipeline builder Enbridge Inc. is one of the few companies going after those new customers in China and Southeast Asia. It's the biggest shipper of bitumen to the U.S and is currently building a $4.2-billion pipeline to the Pacific Coast, dubbed the Northern Gateway, initially to serve China.

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Tories Lack Of Planning Wins Election

There was no enumeration done between the 2004 an 2008 election despite thousands of new people coming to the province to gain from the current boom. Instant Albertans, you only have to live here for six months to be eligible to be called an Albertan and vote, became eligible to vote during that time. But did the Tired Old Tories do a new enumeration. Nope. So massive amounts of voters found themselves having to fill out forms at polling stations identifying where they live. On line attempts to register also failed.

I scrutineered the advance poll in Edmonton Strathcona and again election night and watched as frustrate voters were directed to identify themselves with a picture id and a power bill showing where they lived. In many cases these folks had voted in the last provincial and federal and municipal elections and had not moved!!! Polling stations overlapped so voters came to a poll they thought they voted at only to be told to go somewhere else.

The Tories had no plan for this election. Which is like the rest of their policies, make em up on the fly. So the result was that they only got elected because the majority of Albertans did not vote.

The Tories got elected through voter enui, which they count on. Unfortunately the old anarchist adage, Don't Vote It Only Encourages Them, applies here but not as one would think.

'Won't vote' wins majority

Another, rather perverse, possibility is that some non-voters realize the political class is a lot more likely to worry about them if they don't vote -- by writing earnest opinion articles about the dangers of a disengaged electorate, for example -- than if they validate the process by marking ballots.

The Tories count on Albertans not voting in order to get elected. I know it appears counter intuitive but they really don't want Albertans to vote it ensures their re-election. They all but admit that. They reminded us of that Monday night when Ed told the press that Albertans "only vote to turf out a government". As they did in the landslide election of 1935 and again in 1971.

Alberta's "shameful" voter turnout for its provincial election sparked anger and disappointment Tuesday, with analysts trying to figure out the root of the apathy and Liberals calling for a probe of voting problems.

Only 41.3 per cent of eligible Albertans cast ballots Monday -- a record low for the province and the worst turnout to elect any current sitting government in the country.

Some Albertans blamed voting problems -- like being directed to the wrong voting station -- for not being able to cast their ballots.

Turnout has been sliding in Alberta since 1993, and this time the number came in below the previous worst – 44.7 per cent in 2004.

Let's conclude -- and underline the truly dreadful nature of Monday's turnout -- by stating party results in terms of all potential voters.

Doing that, we see that of 2,252,104 folks on the voters list, about 22.2 per cent voted Tory, 11.1 per cent voted Liberal, 3.6 per cent voted NDP, 2.6 per cent voted Wildrose Alliance, and two per cent voted Green.

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Alberta No Longer Rat Free

Alberta has long prided itself on being rat free. No longer. There are now 73 of the little buggers newly elected as the Tired Old Tory Government. Ed Stelmach of course is King Rat now having even beat King Ralph's election record. . Yep its the year of the rat I should have known this would happen.

When Buddha invited the 12 animals of the Chinese Zodiac to his New Year party those many years ago, the cunning little rat was the one who took the first seat by his side.

While the tale is told differently in each eastern culture, the rat's manipulative nature is always connected to his ability to be the first animal to arrive at the party and the first to be selected for the Chinese Zodiac.

Thus, this year, 2008, is not only the Year of the Rat, but also the beginning of a new 12-year zodiac cycle.

The Rat (鼠) was welcomed in ancient times as a protector and bringer of material prosperity. It is an animal associated with aggression, wealth, charm, and order, yet also associated with death, war, the occult, pestilence, and atrocities.

Negative Traits Controlling, obstinate, back-stabbing, resentful, manipulative, cruel, vengeful, power-driven, critical,sleepy

Rat people are endowed with great leadership skills and are the most highly organized, meticulous, and systematic of the twelve signs. Intelligent and cunning at the same time, rats are highly ambitious and strong-willed people who are keen and unapologetic promoters of their own agendas, which often include money and power. They are energetic and versatile and can usually find their way around obstacles, and adapt to various environments easily. A rat's natural charm and sharp demeanor make it an appealing friend for almost anyone, but rats are usually highly exclusive and selective when choosing friends and so often have only a few very close friends whom they trust.

Ah well I cry in my beer at the NDP victory party which began as a raucous affair only to end as a wake. They lost two seats to the Tories.

Though of course not as bad a loss as the Liberals which never even had a victory party but rather held a subdued gathering planning the upcoming going away party for Leader Kevin Taft.

And the Wildrose Alliance Party, WAP, appropriately got whapped with Leader Paul Hinman losing his seat, the only one the fledgling party had. As I had predicted. Well at least one of my prestidigitations was correct.

The Greens on the other hand, didn't win any seats but gained in popular support especially in central Alberta. Look for them to be the new party of the right to challenge the Tories.

Sigh ah well another four years of Tory democracy in Alberta, now I know how the folks in Russia feel.

With 97 percent of the precincts counted early Monday, Medvedev had more than 70 percent of the vote, according to the Central Election Commission. That percentage nearly matches Putin's tally in 2004 and infuses Medvedev's victory with the numbers to claim a clear mandate for the next four years.

As expected, Medvedev crushed the anemic challenges of three opponents who never had a chance to debate him and were drowned out by a deafening media drumbeat that Medvedev was "Putin's choice" and that his victory would ensure the continuation of the popular president's policies.

Another King Rat in the year of the Rat.





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Ed Gets The Bird

Calgary giving Tories cold shoulder....and a bit more....

Some of the brewing hostility in Calgary toward the PC leader was exemplified Saturday, though, when an older woman stopped her car in the middle of a busy north-end street to honk the horn and flip a one-finger salute at the Stelmach campaign bus.

So much for Calgary being the Conservative Heartland.....

Some Calgary Conservative candidates say they're facing the wrath of voters who don't believe Premier Ed Stelmach understands the city.

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It's Not A Leadership Race

Not since the ill fated Don Getty regime have the Tired Old Tories been in such a sorry state. Before Getty the Lougheed Team could do no wrong. After Getty the man of the people; King Ralph could do no wrong. The Tories would do well in the polls because of the Leader. The leaders polling numbers would often be stronger than the party's, and thus the party was buoyed by the popularity of its leader.

Now with wimpy Ed as leader the election comes down to hard fisted Realpolitiks. Despite polls saying Ed's Tired Old Tories are at 40% that is a serious crash in popularity, the direct result of Ed's mushy leadership.

The leadership debate showed that this is not a race about who will be premier, but rather which party will govern and which one is the opposition. While Taft and Stelmach vied for Premiership, Brian Mason showed himself as the leader of the Opposition.

And even then party politics and labels are not as important as the local campaigns. Because there is a lack of political process that involves us as citizens.

Election forums becoming a rare event in Alberta CBC.ca

Liberals have called for strategic voting, and Albertans will. But it won't necessarily be for the Liberals. Sure they will gain seats, as will the NDP.
Hinman and his right wing rump party are destined for the dustbin of history, splitting the vote on the right. Hinman is fighting for his political life just to retain his own seat.

Instead of venturing into Calgary, Wildrose Alliance Leader Paul Hinman campaigned in his home riding of Cardston-Taber-Warner, knocking on doors and attending a barbecue with supporters.

And who knows the Green Party may even have a chance, with their appeal to rural Tory voters disenchanted that Farmer Ed has become Alberta CEO and the mouthpiece for Big Oil.

Farmers join forces with 'tree huggers' to protest Tories' lax environmental record

Tomorrow there will be a sea change in Alberta. A record number of folks are voting in advanced polls. There are hundreds of thousands of new Albertans and consequently undecided voters. Conservative party supports will stay home in droves unsatisfied with Stelmach's regime.

Barely 5 per cent of the electorate could be bothered tuning in to the only leaders' debate of the campaign.

And voter turnout, which hit historic lows last time with a meagre 44-per-cent turnout, could well drop even lower on Monday.

“The turnout's going to be brutal,” says Arnie Hansen, an Onoway-area cattle rancher and oil driller who has come in to the fertilizer supplier this sunny afternoon.

“That's the way it works in Alberta. They stay home. They don't vote for someone else. They just stay home.”

All in all it looks like perhaps we will have a minority government. Or at least as close a semblance to a minority government after 76 years of the One Party State. Who will lead this new government is anybodies guess.

Polls have repeatedly projected an 11th consecutive Tory majority on Monday, but they also reveal a persistently large number of undecided voters - even this late in the campaign. Meanwhile, a surprising number of voters are calling for a change in government, are unhappy with Progressive Conservative Leader Ed Stelmach and are willing to switch their vote.

"There's definitely a lot of fluidity yet in the voter commitment," said Harold Jansen, a political scientist at the University of Lethbridge. "Voters are ready for a change. They're ready for something different, but none of the opposition parties have done a good job inspiring it."

The undecided segment has all parties - especially the Tories - in a knot.

But it ain't about leaders or party labels. It is about issues though. And voters will decide what issues are important and vote for their issues, which leaves Stelmach's Tired Old Tories in a very weak position.

And in the final analysis this election is about who has the hard slogging political machine in each riding. Who can get out the vote. It's the closest thing to real election this province has seen since 1971.

And I would remind folks who say the opposition parties are weak, that back in 1971 the Lougheed Team that came to power had only 6 sitting MLA's.

And when all is said and done its not just about who gets to govern but who is the opposition. That is the understated part of this election. And surprise, surprise guess which party looks good for that job.

During the campaign, Brian Mason's New Democrats have shown they have the policies and philosophy to provide effective and consistent opposition.

Neil Waugh, Edmonton Sun, Sunday March, 2, 2008

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