Albertans Want a Public Review of Oilsands Royalties

May 23, 2006

A large majority (84 per cent) of Albertans believe there should be a public review of oilsands royalty rates to ensure Alberta is getting the maximum benefit from this non-renewable resource.

In Alberta, companies pay 1 per cent royalty to the provincial government until their project costs are paid out and then only a 25 per cent royalty.

Albertans believe they are not receiving maximum benefits from the development of the province's oilsands, according to a major new opinion poll commissioned by the Pembina Institute.

Albertans were asked about their perceptions of oilsands development, and their opinions on the current royalty regime and how to invest oilsands revenues. The results show that Albertans believe the government should capture a greater portion of oilsands wealth for Albertans, and invest revenues to assist the transition to an economy that supports more sustainable forms of energy.

The Pembina Institute agrees. According to Chris Severson-Baker of the Pembina Institute, "As conditions change, royalty rates should also change. It's been done before in Alberta and elsewhere." In the early 1970s, the Lougheed government boosted royalties and used some of the increased revenue to establish the Heritage Fund.

"Alberta's strategy to liquidate its resources as fast as it can is not in the best interest of Albertans, especially in the long term," says Amy Taylor, lead economist with the Pembina Institute.

The Pembina Institute believes oilsands royalties should be reviewed and revised upward to provide maximum compensation to Albertans for the development of these non-renewable and publicly owned resources. Windfall profits should not be left with companies; they should be transferred back to Albertans.

"When we asked Albertans about royalty rates, more than 80 per cent supported calls for a public review of royalty rates. More than 60 per cent believe they are not getting maximum revenue for oilsands. They want to make sure they're getting their fair share of this non-renewable resource," says Taylor.

"Not only do they want a fair share, they also want to invest in more sustainable energy options. More than 90 per cent of Albertans believe the government should use a proportion of the revenues from oilsands to fund development of alternative energies," says Taylor.

These are some of the findings of the opinion research conducted recently for the Pembina Institute by Probe Research, a professional polling firm based in Winnipeg, Manitoba. The findings are based on a phone survey of 500 Albertans between April 7 and 13, 2006, with a margin of error of 4.4 per cent, 19 times out of 20.

This is Part 1 of a two-part survey commissioned by the Pembina Institute about Albertans perceptions of oilsands development. Part 2, which focuses on Albertans' opinions about environmental issues associated with oilsands development, will be released next week.

Details of the economic portion of the survey can be downloaded here.

Full survey and data tables will be available on the Pembina website at or following the release of Part 2 poll results.


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