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Thursday, September 27, 2007

Note to Premier Stelmach: Oil is a Seller's Market

Here is some highly relevant information for Albertans and their politicians when they consider the recommendation of the Royalty Review Report.

I find it interesting that some of the current oil patch players are saying the industry will leave Alberta if the royalties go up. Strange when we see “unsophisticated oil nations” like Norway, China and Dubai buying up companies or oil sands leases.

It is a sellers market Premier Stelmach. This is a but and a big picture long term policy issue Premier Stelmach. You and your government are our Trustees responsible for long term stewardship and development of our resources. YOU must ensure the development benefits all of the citizens of Alberta - anw and in the future.

The answer to the Royalty Review Report is obvious…don’t let anyone obfuscate the issues with short term narrowly framed self interest positions or threats.

-----Original Message-----
From: UNNews@un.org [mailto:UNNews@un.org]
Sent: September 27, 2007 9:00 AM
To: news11@secint00.un.org
Subject: COMPETITION FOR OIL AND GAS RESERVES HEATING UP, SAYS UN TRADE BODY

COMPETITION FOR OIL AND GAS RESERVES HEATING UP, SAYS UN TRADE BODY New York, Sep 27 2007 11:00AM The emergence of new players in the global market and shifts in the policies of gas and oil producers means that traditional conglomerates from industrialized nations are facing increasing competition in the race to access the world’s reserves, the United Nations agency on trade and development issues said today.

With crude oil prices staying well above $70 a barrel, traditional transnational corporations are losing bargaining power to oil-producing countries “eager to use climbing demand to capture a larger share of the rents,” <" http://www.unctad.org/Templates/webflyer.asp?docid=9016&intItemID=1528&lang=1 to the UN Conference on Trade and Development (UNCTAD).

The agency draws attention to “large imbalances” in global consumption, production and reserves of oil and gas, such as the fact that developed countries consume more than half of global oil and gas output, while they account for only a quarter of production.

Moreover, less than 8 per cent of the world’s remaining proved reserves of oil and gas are found in these countries. As many as 21 of the top 25 countries ranked in 2005 by total remaining proved reserves were developing or transition economies.

In addition, data suggests that resources in developed countries are being depleted more than 10 times faster that that of developing and transition economies, which means that the former will have to rely increasingly on oil and gas imported from the latter.

Competition for oil and gas resources is becoming more complex, according to UNCTAD, due to changes in government policies in producing nations. Some developing countries with large reserves, such as Kuwait, Mexico and Saudi Arabia, do not allow foreign participation in oil and gas extraction.

Others permit foreign investment but are facing embargoes applied by the home countries of companies, such as in the case of those from the United States which are not allowed to invest in Iran or Sudan.

Also affecting competition is the entry of new corporations based in developing and transition economies, including Kuwait Petroleum, Lukoil (Russia), Petrobras (Brazil) and Petronas (Malaysia), who are already among the main foreign investors in selected oil and gas producing countries and operate alongside traditional companies from the developed countries such as British Petroleum, Royal Dutch Shell and Chevron.
2007-09-27 00:00:00.000


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