What do Alberta Premier Ed Stelmach and Venzuelan president Hugo Chavez have in common?
At first glance, you might say nothing. One’s a conservative and the other a left-wing revolutionary. But they do share an important similarity: they both want to raise royalties on the companies that profit from the huge oil reserves in both places.
Stelmach recently floated the idea that another $1.4 billion should flow to Albertans rather than into corporate coffers. Chavez did something similar a while back and went a step further to take government control of the oil industry.
Industry officials kicked up a big fuss, threatening to stop production and move elsewhere. But with oil reserves dwindling everywhere, those threats are pretty weak.
Russia and Bolivia have also taken greater control of their oil patches. Nigeria, may be the next country to go for the black gold in higher royalties.
The African nation is the fifth largest supplier of crude oil to the United States, but few Nigerians see any of the benefits. In fact, few of them have access to clean water or electricity.
As former British Columbia premier Dave Barrett once said to the mining industry, if we can’t make a deal then we’ll just leave it in the ground until someone can. Maybe the same logic should apply to Alberta oil.
For the full story, see this Oct. 24, 2007 Associated Press article.