This looks like a must read book:
Stupid to the Last Drop by William Marsden
Yes at one time they were considering nuking the Alberta Oil Stands to extract the oil… funny this may have less of an environmental impact than what is currently going on.

Manley L. Natland was sitting alone in the southern desert of Saudi Arabia when an extraordinary idea popped into his head.

It was the end of a long day, and Natland was watching the sun set. Wrapped in thought and a Bedouin turban, the American geologist contemplated the climax to nature’s magic hour. “It looked like a huge orange-red fireball sinking gradually into the earth,” Natland later wrote in his diary. His mind wandered, and the display of the sun’s explosion of light caused his thoughts to take a sinister and disturbing turn along the following lines: sun, heat, 15 million degrees Celsius, energy, thermonuclear weapons. And then the idea struck.

Why not nuke Alberta?

Full review at McCleans.

This is my favourite article that has appeared since the release of “Our Fair Share.” The CattleNetwork in an article Alberta Angles For a Bigger Share of Oil Receipts as Futures Soar referred to the Canadian system of government as highly decentralized.

The CattleNetwork wrote:

Alberta isn’t the only province hiking taxes in Canada, whose system of government is highly decentralized. Only last month, Newfoundland and Labrador Premier Danny Williams - dubbed “Danny Chavez” - succeeded in imposing such a “super-royalty” linked to oil prices on the Hebron offshore oil project. This Chevron Corp.-led (CVX) venture halted talks with the provincial government for more than a year because the companies didn’t want to pay the tax.

The CattleNetwork then immediately moved on to the situation in Venezuela stating:

Under President Hugo Chavez, Venezuela has strengthened its grip on oil resources, most recently telling foreign oil companies they must cede some ownership and operational control of the Orinoco heavy oil properties to the state oil company. In response, ExxonMobil and ConocoPhillips (COP) abandoned their projects.

Again, the American media shows its ignorance of foreign countries. When you take into account that each province controls its own resources, the reality is that the management of resources is highly centralized. There is a difference between the approach in Venezuela where the state has demanded that the oil companies surrender ownership in its projects and Alberta which claims it should be fairly compensated for the resources it owns. At least the article was entertaining.

Ever notice how in Alberta people are very anti-welfare or social assistance? But when corporations want welfare that is cool… hypocrtical no?

Sept. 28 (Bloomberg) — EnCana Corp., Canada’s largest natural-gas producer, said it will cut its 2008 investment in Alberta by about C$1 billion ($1 billion) if proposed increases in oil and gas royalties are adopted in full.

Many developments would no longer be economically viable under the higher royalties, Calgary-based EnCana said today in a statement. A government-appointed panel on Sept. 18 recommended Alberta increase royalties to reap additional benefits from rising energy prices.

EnCana’s announcement is “necessary posturing” aimed at putting pressure on Alberta Premier Ed Stelmach to water down the panel’s recommendations, said Frank Atkins an economics professor at the University of Calgary. Alberta’s economy will continue to be driven by oil-sands projects since the panel told the government to keep royalties low on such projects until companies recover their investments, he said.

Link.

This is probably a good thing. From the Globe and Mail:

The fast and furious pace of migration to Alberta is finally starting to ease.

Interprovincial migration to oil-rich Alberta was estimated at just 7,400 people in the second quarter of the year, more than 2,000 fewer than in the same period of 2006, Statistics Canada said Thursday.

Net migration to the province swelled over the past two years. It peaked during the third quarter of last year though, and has been decelerating slowly ever since, the report noted in preliminary demographic estimates for the first half of the year.

Statscan hasn’t yet explored why this may be happening, but it does note that the province’s cost of living continues to rise, and that some residents may be leaving Alberta to return to neighbouring provinces.

Link.

The Financial Report notes that according to Wood MacKenzie, an international energy research firm:

The Alberta government would knock US$26-billion off the value of 28 projects in operation and under development in Alberta’s oilsands if it adopts proposals to increase taxes and royalties from the energy sector by 20%.

The conclusion of Wood Mackenzie is that it expects that projects still under development would be hardest hit, suffering an erosion in value averaging 30%. The article reports that Wood Mackenzie stated that:

“[Proponents] might slow down or shelve some of these projects in the long term and negate the benefits that the Alberta government seeks through near-term increases in royalties. Clearly, what we have here is an increase in risk across the board, and it all depends on whether that is something the companies are willing to accept, or whether they decide now is not the time to go forward.”

If the report is correct projects that are not viable in the sense that Alberta residents will not receive their fair share of royalties if they proceed may be shelved. Should this be a concern? Do Albertans’ want to destroy the boreal forest under which the tar sands are found in circumstances in which they will not receive fair compensation? A project is only truly economically viable if all of the factors, both its benefits and consequences are taken into account and there is an acceptable profit margin. If the oil companies and their shareholders are not prepared to accept a lower profit margin to develop a resource which will pay dividends for decades in a politically stable climate perhaps they should invest elsewhere.

In reality I doubt the findings of Wood McKenzie are accurate. They found that the 28 mining and in-situ projects’ combined net asset value of US$200-billion would decline by an average of 13% provided all go ahead, and assuming oil prices stay constant at US$50 a barrel over their productive lives. What do you think the chances are that oil prices will stay constant at US$50 a barrel? Maybe Wood McKenzie needs to rework their numbers.