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By The Canadian Press

Against Capitalist Principles

Scotiabank adds name to chorus critical of UCP royalty credits for well cleanup

Feb 10, 2023 | 10:30 AM

Alberta’s United Conservative Party government is facing growing criticism over its plan to give oil companies a royalty credit for cleaning up their old wells.

A royalty is the price Alberta charges a company to develop a resource.

The province is planning a pilot project that would give $100 million in royalty breaks to companies that fulfil their legal obligations to restore old oil and gas wells.

Analysts with Scotiabank say the plan has the potential to generate negative public sentiment toward the oil and gas sector, and goes against the core capitalist principle that private companies should take full responsibility for their liabilities.

Drew Barnes, a former member of the UCP caucus, calls it a “government boondoggle.”

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Meantime, Alberta NDP Energy Critic Kathleen Ganley is calling on Danielle Smith to immediately stop her plans to give away billions of Alberta taxpayers’ dollars and invest in health care and making life more affordable for families.

“It’s another scam from Danielle Smith and the UCP. These are royalties that belong to the people of Alberta and to future generations. To give this away will squander the energy price boom we are currently experiencing and is fiscally irresponsible,” said Ganley. “It amounts to a massive transfer of wealth from Alberta families to companies who don’t need it.”

Ganley says the program has received criticism from rural municipalities, landowner groups, and economists.

“The UCP has the wrong priorities. They must stop this program immediately and use the money for what is intended for — to invest in our province’s future. This includes fixing the crisis in health care, making life more affordable, and building a resilient jobs economy.”

This report by The Canadian Press was first published Feb. 10, 2023.

The Canadian Press

(With files from rdnewsNOW)