Reason for royalty rollback questioned
Posted May 28, 2010 11:40 am.
This article is more than 5 years old.
The rollback of provincial royalty rates has insiders asking a number of questions.
While industry reaction has been very positive to the change, predicting it will result in increased investment and drilling, some are questioning the timing of the announcement.
A few experts are wondering if the motive behind the rollback is economic, political or a combination of both.
When the province originally hiked royalty rates several years ago the decision was made without much input from the energy industry.
This time, industry insiders were consulted before the rates were rolled back.
Mount Royal University Political Scientist Duan Bratt tells 660News the about-face was a result of both the economic downturn and a surge in the popularity of the upstart Wildrose Alliance.
Bratt says the royalty rate reductions are not enough to repair the province’s strained relations with the industry because a level of distrust still exists.
As for how they will help Tory political fortunes, Bratt says that depends how many jobs they create.
