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NDP's Revenge Tax Cause Hundreds Of Millions Of Dollars In Losses


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So, all you're capable of, is reading off the latest Conservative Party talkingpoints, and when you get slammed by hard facts that cannot be denied...like the squandering of billions of dollars in oil revenue by the Provincial Conservative Governments in Alberta over the decades, you got nothing! You think a childish personal attack is going to impress anyone?

The NDP is destroying Alberta in typical NDP fashion. Sorry you are reading from NDP talking points, but you are wrong. You got nothing!

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Some of those talking points are pretty bang on....the PCs DID squander billions. They always did. However, not many people out here gave a damn as long as the taxes were low and they made enough cash to buy things they wanted. Like a 911S ( ;) ).

Now that the NDP has taken over, they will squander billions (because they've never had their hands on a cookie jar quite like Alberta before), only people won't have enough cash to buy things they want.

That's your difference.

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Some of those talking points are pretty bang on....the PCs DID squander billions. They always did. However, not many people out here gave a damn as long as the taxes were low and they made enough cash to buy things they wanted. Like a 911S ( ;) ).

Now that the NDP has taken over, they will squander billions (because they've never had their hands on a cookie jar quite like Alberta before), only people won't have enough cash to buy things they want.

That's your difference.

In theory, there'll also be more cash available to buy what's needed.

In any case you be sure to let us know when that Porsche dealership closes okay? You just might be onto something.

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Samson has basically nothing to do with the oilsands.

I didn't say they did! But, if you can't see a parallel between what's happening to the smaller shale oil producers and the larger tarsands operations, you're not paying attention! The only difference is tarsands has more money behind them and will be able to hold out longer. But, if there is no return to a good-old-days of worldwide economic growth, they will end up in the same mess.

Wrong again. The wells up here don't "need" fracking or to be drilled horizontally. The reason you go horizontal is reduction of cost - you drill one vertical well, and then punch out the side to get to the zone your "next well" would have been over without the costs of a new lease or moving the rig and services. One location - as many horizontal legs as you can fit (and some of those wells are over 4500m deep in the foothills and you can fit a LOT of horizontal legs off of that). Horizontal drilling is about efficiency, not need.

4500 m is pretty deep and expensive, and the horizontal legs further down will be more costly than closer to the surface.

So, how many holes have to be drilled and how long can the oil deposits be pumped before they go into decline? Because that's what's killing the Bakken right now. There is no means to get the oil out of the ground and make a profit at today's prices.....let alone pay off the accumulated debts to investors.

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The wells that deep tend to be for high pressure gas not oil, but when they do their kick-off at various depths they can go out a looooooog ways into a production formation. If they run, say, 9 5/8 intermediate casing they can usually run up to four production lines inside that, and if each one went out horizontally 2500-3000 meters, that's a whole lot of formation being covered. Depending on the geologicals for the area, some of those wells produce for 5-10 years before they need any stimulation (and a lot of the time all they need is water injection not fracking). The well costs (maybe a few million) are a drop in the bucket compared to what the production values are over the long term. And when the oil production is done, they can just re-enter the well and produce gas (or vice versa). They're money makers.

The comparison you're trying to make between shale operations and oilsands operations doesn't exist. Drilling relies on existing field data and seismic. Oilsands is a known entity - the oil is there and can be core drilled from surface in a single day to confirm (not that they have to). They have a pretty damn good idea of the quantity available before they plunk a multi-billion dollar facility on top of it. The other thing to keep in mind is that when oil is high, you produce. When oil is low, you build. Right now construction costs are at a multi year low so get ready for the major players to start building/expanding their operations in 2016/17. It only makes financial sense since these guys are in there for the long haul, not like shale players.

Hell, oilsands companies were producing when oil was $10 a barrel so what makes you think that +/- $50 oil is going to stop them? The profit per barrel doesn't have to be as high on projects as it does on production wells because of the known longevity. If they can build what they need for 40 cents on the construction dollar, they'll be even better positioned when the price of oil starts to bounce back. This downturn won't stop the major players - never does, but it makes for the perfect scapegoat to reduce and "right size" the company and all the service companies below them.

Watch for the major oil companies to start swallowing up the small and mid-sized producers at fire sale prices.

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the Alberta Heritage Savings fund is currently at $17.7 billion... that's it... that's all Alberta has to show for it's "oil advantage". Meanwhile, Norway's 'sovereign wealth fund' recently went over the $1 trillion dollar mark... and even then, Norway has been using it's oil revenue to help fund it's shift off fossil-fuels and help pay for it's alternative energy pursuits. So, as you say, "big fail by the Alberta PCs"... right?

And Ontario has a $400 billion DEBT. So much for having all that industry.....

And cut the shit about Norway. Does Norway toss a big chunk of cash into an equalization scheme every year? Does Alberta have complete control of.... anything?

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And Ontario has a $400 billion DEBT. So much for having all that industry.....

And cut the shit about Norway. Does Norway toss a big chunk of cash into an equalization scheme every year? Does Alberta have complete control of.... anything?

per the latest 2013-2014 Ontario Financing Authority statement, Ontario debt is $288 billion... but who's counting? Those yearly debt servicing costs seem quite manageable in the face of total revenues. In any case, you appear to be yet another guy who has no idea how equalization works, or the amounts in question. You may want to look at a, by province, accounting of federal revenue versus total transfer payments (whether health, social or equalization)... that per-capita figure of total federal support, by province, is a handy figure! I appreciate just how upset you are when that Norway comparison is trotted out... it really shows just how badly Alberta 'screwed the pooch'! And here I thought Alberta had control of its royalty return structure from BigOil... and its diversification strategy - go figure, hey!

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Waldo, the Norway comparison IS a bunch of bs. The only way you could make the connection between Alberta and Norway accurately would be to treat Alberta as a country - meaning that all revenues generated (royalties, taxes, etc) would have to stay in the "country". There would also be added expenditures for the Republic of Alberta (my emphasis) such as military and "federal" pension, etc but I think mathematically you'd find that RoA would be much, much better off financially in that case.

Now the PCs of this province pissed away a ton of money on lost royalties and really bad spending, but to compare it's current state to that of a Norwegian country in unfair at least and completely disingenuous at best. There would likely be zero debt and one hell of a bank account if there were no cost to paying to stay in a confederation.

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The only way you could make the connection between Alberta and Norway accurately would be to treat Alberta as a country

Seeing as we have a federalist arrangement and natural resources fall under the provinces.....what exactly is the argument here? That the oil companies pay federal income tax, so it's not a fair comparison?

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The argument is that a direct comparison between a province and a country is ridiculous. You mentioned one part - federal taxes for corporations - if someone wants to compare piggy banks between Norway and Alberta, let's start with everything being paid to the feds out of this province. The whole equalization thing is complete bullshit depending which side of the fence you're standing on (that's a personal belief issue), but there is absolutely no argument that, from a strictly financial standpoint, Alberta would be billions ahead if it did not exist.

And keep in mind, we're not talking a small amount of pocket change over the years from federal taxes on Alberta, et al. This is big, big numbers.

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Not the province per se, but everyone in it and all companies do (for the most part...). Redirect those billions to the Alberta coffers instead of the federal ones and then maybe we'd be getting close to a reasonable comparison between a province and a country.

I'm not supporting the yea or nay at all - I'm just pointing out how stupid the comparison is. Which is faster, a kid on a competition level mountain bike or a kid on a Honda CBR250? Exactly - stupid comparison.

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gold, real gold! Always a pleasure to be called out directly within a status update... since the MLW member deletes my comments, I'll reply here:

Since NDP elected in Alberta cost of groceries has skyrocketed over 20% on average,just wait till after October 19th. Sorry for the facts, MLW member, waldo. Cue the excuses. BAWAAA


declared "facts" require both data and accompanying analysis... waiting! :lol: Tomorrow, is the exact 5th month anniversary date of the Alberta 2015 election win by the NDP. One single ~3 week Spring legislative session has been held... the Fall session is scheduled to begin Oct. 26. Geezaz that new NDP government is sure being held to account for just about anything/everything, hey! (notwithstanding I'm not quite sure of the relevance the status update reference makes to the federal election date... perhaps the MLW member can clarify... at the same time "facts" are substantiated/attributed).

Edited by waldo
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The argument is that a direct comparison between a province and a country is ridiculous. You mentioned one part - federal taxes for corporations - if someone wants to compare piggy banks between Norway and Alberta, let's start with everything being paid to the feds out of this province. The whole equalization thing is complete bullshit depending which side of the fence you're standing on (that's a personal belief issue), but there is absolutely no argument that, from a strictly financial standpoint, Alberta would be billions ahead if it did not exist.

And keep in mind, we're not talking a small amount of pocket change over the years from federal taxes on Alberta, et al. This is big, big numbers.

can you provide an accounting of the "equalization transfer monies" that the province of Alberta provided to the federal government? Oh, wait... that's right - there is no such thing! As I said in a prior post above:

"In any case, you appear to be yet another guy who has no idea how equalization works, or the amounts in question. You may want to look at a, by province, accounting of federal revenue versus total transfer payments (whether health, social or equalization)... that per-capita figure of total federal support, by province, is a handy figure!"

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Nice try, but you and I both know that what I said is true. The amount of money that is sent OUT of Alberta (taxes) versus the amount of money that is transferred back IN is quite different. I don't much care how you want to calculate it, but the "out" is far greater than the "in", hence my point about.

And you can believe that I understand quite well how equalization works.

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Nice try, but you and I both know that what I said is true. The amount of money that is sent OUT of Alberta (taxes) versus the amount of money that is transferred back IN is quite different. I don't much care how you want to calculate it, but the "out" is far greater than the "in", hence my point about.

And you can believe that I understand quite well how equalization works.

no - you clearly don't understand how equalization works... equalization monies, proper, are relatively small in relation to overall federal revenues and TOTAL federal expenditures to the respective provinces. Again, there is no such thing as an "equalization transfer of Alberta monies" to the federal government. What you're really speaking to is the difference between revenues and expenditures... in that regard, more pointedly, the federal government does not receive anything directly from any province; rather, federal taxes/revenue are collected WITHIN a respective province, not FROM a respective province... be that personal income tax, corporate income tax, GST, investment income, etc. And most pointedly, federal expenditures to the provinces are, of course, more than just the so-called 'formal transfers' like health (CHT), social (CST) and equalization... they also include all manner of spending like for infrastructure, transportation, education, national defence, grant/funds for recreation & cultural events/festivals, environment, security, etc..

what you're really highlighting is the distinction between federal revenue collected within the province of Alberta versus the amount of federal expenditure... and, of course, you're focused on the distinction of so-called "have versus have-not" provinces within the equalization program. Presently, 4 "have" provinces are not receiving any equalization payments... for 2014/15, approximately $16 billion was shared in equalization funding to the other 6 provinces and 3 territories... that's it - equalization, proper, for the whole country, had the federal government transferring "equalization payments" of ~$16 to all of Canada (those 6 provinces and 3 territories eligible).

your IMF task Mr Hunt, should you be willing to accept it, would be to show the actual disparity for Alberta (federal revenues collected within the province versus federal expenditures spent within the province)... and provide attribution to that end. The key part of your analysis should recognize the fundamental principle being followed with most federal transfers/expenditures is that it is done on a per capita basis... now, I've read a dated 2012 article (referencing StatsCan 2009 data) that speaks to Alberta receiving ~$16 billion less in federal expenditure monies as compared to federal revenue collected within the province... but this has nothing to do with equalization! Unfortunately, it appears StatsCan no longer produces these same related 2009 data tables/reports... perhaps you can source it some other way... and provide a related analysis that speaks to just why the federal government is not spending as much within the province of Alberta... but remember to factor 'per capita spending' in relation to other provinces.

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Here's an interesting look using 2009 numbers - so a bit old: http://thoughtundermined.com/2012/07/22/a-closer-look-at-federal-revenues-and-expenditures-by-province/

I think the point is that all those high paying oil jobs lead to some nice tax collection by the Feds. If oil jobs go away then those revenues go down and perhaps the fed expenditures on things like EI go up.

While it was wise of Albertans to deposit all those dinosaurs millions of years ago there is no doubt that Canada, as a whole, benefits from it too.

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While it was wise of Albertans to deposit all those dinosaurs millions of years ago there is no doubt that Canada, as a whole, benefits from it too.

You cant judge that without doing a complex macro-economic analysis. Oil exports effect the value of our currency, and cause it to rise and fall with the price of oil. In order to judge whether or not it produces a net benefit you would have to look at the impact these swings in currency values have on other industries.

Oil-and-Loonie.jpg

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