Royalty Incentives Alone Won’t Save Alberta’s Oil and Gas Industry
CALGARY, ALBERTA - (Marketwire - March 4, 2009) - While the Energy Incentive Program announced yesterday by Alberta Energy Minister Mel Knight is a good step for Alberta’s oil and gas industry, access to capital remains a major stumbling block to Alberta’s economic recovery says AJM Petroleum Consultants, an evaluation firm that specializes in the economic evaluation of oil and gas reserves.”The Alberta government deserves credit for their efforts to stimulate an industry that is in a critical state,” said Ralph Glass, VP Operations of AJM Petroleum Consultants. “However, it’s important to bear in mind that the current slump in the oil and gas industry wasn’t caused by the introduction of the new Alberta Royalty Framework - it is a result of the capital equity freeze and the crash in the commodity prices. The government’s new drilling incentive program improves the situation for companies who have ‘money in the bank,’ but it won’t have much impact on companies who need to access capital to fund their drilling programs.”