so a carbon tax will destroy us but a pst hike won't?

[bucket]

An iceberg will win over steel....that's been proven....

[chuckChuck]

"$56.25 — Price per barrel of oil, according to the province’s key revenue assumptions. The assumed per-tonne price of potash: $176. Based on the assumptions, oil and natural gas royalties are $670 million, while potash royalties are $261 million."

On the revenue side we are taking only a small amount royalties from the resource sector. We also get a significant amount of taxes from these sectors but I am not sure how much.

Is there room to take more royalties? Probably.

How many saw the story in the Western Producer about all the abandoned orphaned oil wells in Alberta?

https://www.producer.com/2018/03/orphan-wells-albertas-47-billion-problem/#

"He quoted a report by the C.D. Howe Institute that estimates more than 155,000 Alberta energy wells have no economic potential and will eventually require reclamation.

He also quoted Orphan Well Association figures that it costs an average of $304,448 to reclaim a well.

That math leads to a big number: $47.19 billion in future reclamation costs."

So we let the oil companies off with low royalties. They extract a lot of wealth and make significant profits. They abandon the facilities or just never clean them up. They leave land owners and tax payers with the bill to clean up?

If you estimate the average oil well lease pays $3000 per year in parts of Saskatchewan. It would take 100 years to collect $300,000 and pay taxes on it and then you are responsible for cleaning up the site?

You will have lost a significant amount of money as a landowner because most oil wells wont last even 25 years. Not to mention all the lost crop.

Where has the all the profit from the oil gone? The oil industry is extracting a lot of profits on the backs of farmers, landowners and taxpayers if they abandon facilities.

[RD414]

Well big wheel, simple matter is govt. needs more money and you can either have everyone pay a little more with pst or a smaller group pay it all. That is what a carbon tax does to my farm. Comparing our deficit to the Alberta or Ontario, I'll take ours anyday. We do need to clean up a lot of useless bureaucrats and light weight Mla's who are there just for the cheque.

[SASKFARMER3]

RD good points we need to also consolidate constituencies and get fewer MLAs NDP and Sask party.

Useless people working for the gov TIT is easy to spot walk around any building and you will have a list real fast.

Health tackles the beast once and for all.

But yes ill take a 1% increase or even 2% on the sales tax any day.

[sumdumguy]

I remember the days of Devine intervention, Devine was an awesome premier but those close to him got derailed and led him into deep shize. He paid the price for that. If you surround yourself with garbage, it’s bound to get stuck on you.

[oneoff]

Some on here conveniently forget the impact that freehold oil royalties have on their personal or corporate taxes.
And that net benefit is always positive at the personal or corporate level. There is always a breaking point to squeezing more and more out of any golden goose. Even to the point that the oil industry (the potential golden goose) starts squeezing back on its suppliers cash flow; its position as lessee to landowners; and lobbying for more concessions from taxpayers and consumers.

It shouldn't be necessary to give any examples...but its very evident that those impacts are ignored by even many of those who I just mentioned

And political leadership and those lost in their own troubles aren't seemingly even part of the debate.

Let alone speaking about the contributions to local communities affected (which are very arguably certainly not all positive benefits).

[the big wheel]

The oil boom did not fund itself and now that it's not a boom we can't Even pay the interest on these hair brained ideas.
Well ok we can pay for it more tax more tax.!!!

And who are they hitting the hardest to pay for the hairbrained ideas? Rural Sask that's who.

[Rareearth]

If Ag continues down the road of being in-un-competitive Western Canada will fall into that empty, left over oil barrel and it will be damn hard to get out.

Fact is Ag everything has a lot further to fall than it ever has. Lose Ag and Sask will lose 400,000 people, very fast and I don’t know where they will go. Oil was a global readjust, they were all effected equally. Western Canada, who will fall the hardest and furthest with Ag will have no friends, bankers, Govnt, teachers/nurses, USA, etc

It’s foolish for govt to impose more direct costs onto Ag, when it’s the true economic driver of the economy, the backbone.

If there is a tax burden it must be shared through Flax tax system, or if need be PST and GST systems.

Picking sectors is very risky - unintended consequences. Trump is going up this hill and it just keeps on going and gets a lot steeper - no win just destabilized, uncertainty for the economy.

[chuckChuck]

Some on here conveniently forget the impact that freehold oil royalties have on their personal or corporate taxes.
And that net benefit is always positive at the personal or corporate level. There is always a breaking point to squeezing more and more out of any golden goose. Even to the point that the oil industry (the potential golden goose) starts squeezing back on its suppliers cash flow; its position as lessee to landowners; and lobbying for more concessions from taxpayers and consumers.

It shouldn't be necessary to give any examples...but its very evident that those impacts are ignored by even many of those who I just mentioned

And political leadership and those lost in their own troubles aren't seemingly even part of the debate.

Let alone speaking about the contributions to local communities affected (which are very arguably certainly not all positive benefits).

Unless you own a lot of productive freehold minerals the net after tax revenue is not that significant in many cases and may not cover the cost of reclaiming many wells if it costs $300,000 per well.

The question that needs to be answered is who is going to be held responsible for cleaning up abandoned oil facilities and roads if the oil companies are taking the profit and running away from the long term liabilities?

Many suspended facilities will never be used again and will sit forever because it is cheaper to pay the lease than spend a lot cleaning them up. It can run into the millions if you need to dig up contaminated sites!

If the oil facilities are not economically viable enough to cover their liabilities of cleanup, then perhaps they should not be developed. If they are economic then it only makes sense that the oil revenues pay for cleanup at the inflated cleanup prices well into the future.

I don't think very many people would think it is okay for the oil industry to expect taxpayers or landowners to clean up after they are gone.

There has to be financial and environmental accountability built into the regulatory system other wise it is just another taxpayer subsidy to the oil industry.

[blackpowder]

Won't disagree with Chuck or anyone else on this one.
Guessing the cost to reclaim involves a lot of over the top regs and bullshit.
Common sense clean up would half that cost easily. Many sites probably aren't hurting much anyway.
Cement em and forget em.
Now, who pays all the taxes today and where do they go?
Flat tax for all. Sales tax for all. If it doesn't assist wealth generation or pay a nurse, don't spend it.
Scrap all carbon shell game schemes and taxes.
Get and keep industry rolling. No law says we or the govts can't in turn participate with share ownership.
Simplistic sure. But winning can be brutally simple.

[oneoff]

Unless you own a lot of productive freehold minerals the net after tax revenue is not that significant in many cases and may not cover the cost of reclaiming many wells if it costs $300,000 per well.


That is completely disingenuous.


The orphan well fund in Sask lists the base cost of SE Sask vertical wells sub surface abandonment at about $55,000 plus another $20,000 or so for facility cleanup (if applicable). Now some old salt water spills could be 6 to seven or maybe even 8 figures. But subsurface abandonment costs aren't typically anywhere near $300,000 in your area and recent history of 26 wells in one pool (near you) drilled in the 1950's recently confirmed that. Now the surface environmental cleanup may typically proceed at a snail's pace of decades; but that's a government regulatory failure and the product of shutting down revenues of the oil industry in general.

And the individual land owner in Sask. is not about to foot the bill directly for lease cleanup.

Factors that some don't catch onto or acknowledge

Never have seen or heard of many oil royalty checks returned to the oil industry. Also biting the hand of a cheque writer is not productive when you plan of cashing any color of envelope.

[chuckChuck]

Unless you own a lot of productive freehold minerals the net after tax revenue is not that significant in many cases and may not cover the cost of reclaiming many wells if it costs $300,000 per well.


That is completely disingenuous.


The orphan well fund in Sask lists the base cost of SE Sask vertical wells sub surface abandonment at about $55,000 plus another $20,000 or so for facility cleanup (if applicable). Now some old salt water spills could be 6 to seven or maybe even 8 figures. But subsurface abandonment costs aren't typically anywhere near $300,000 in your area and recent history of 26 wells in one pool (near you) drilled in the 1950's recently confirmed that. Now the surface environmental cleanup may typically proceed at a snail's pace of decades; but that's a government regulatory failure and the product of shutting down revenues of the oil industry in general.

And the individual land owner in Sask. is not about to foot the bill directly for lease cleanup.

Factors that some don't catch onto or acknowledge

Never have seen or heard of many oil royalty checks returned to the oil industry. Also biting the hand of a cheque writer is not productive when you plan of cashing any color of envelope.

This issue is prairie wide. The $300,000 that was quoted came from Alberta and that's why I said if it costs $300,000.

The numbers you quote from the orphan well fund may be more accurate for Saskatchewan but that is the base price (minimum) and may apply in some cases. But when you start thinking about the costs including decommissioning or removing flow lines, removing roads I think the costs may be easily more than $55,000 per well.

Regardless of the actual costs now just like everything these costs are rising. What will it cost in 30 or 50 years. What will oil be worth?

"The C.D. Howe Institute that estimates more than 155,000 Alberta energy wells have no economic potential and will eventually require reclamation."

The number of uneconomic wells in Saskatchewan is not known as far as I know. If the Alberta number is correct then there is not enough revenue to keep the well going let alone pay for cleanup.

So where is the $47 billion going to come from for Alberta? Who is going to pay for the cleanup in Saskatchewan?

The point I want to make is that the oil industry has not accounted for the liability of cleaning up suspended or abandoned and orphan wells. If the taxpayers are left paying for this then we have made a terrible mistake in the regulatory system.

Brad Wall asked for federal funds as a make work project back when oil prices crashed.

As I have said before when you calculate the cost of fossil energy we need to include the environmental costs which include cleanup costs and pollution. If taxpayers absorb the costs then it should be considered a subsidy.

[newguy]

No one like more tax.But i would take a carbon tax ahead of similar priced sales tax increase any day.it is possible a carbon tax will sofen the opinion from enviromental radicals on the pipeline.If that was the case it would be money well spent for Sask and Alberta.I know sales tax has no effect so any positive perception is better than none.

[oneoff]

The point I was making is that a $300,000 per average well abandonment is out to lunch if this matter was handled with some measure of common sense. Also Freehold mineral royalties are manna from heaven and should be acknowledged, appreciated or else returned to the sender.
They aren't meant to compensate for environmental cleanups.

Similarly the point that who knows how large a future cleanup cost may be compared to present costs (if done now) is a red herring. Receiving freehold payments today is also likely to have more value than if they were withheld into the future. Same arguments in both cases.



Quote The point I want to make is that the oil industry has not accounted for the liability of cleaning up suspended or abandoned and orphan wells. If the taxpayers are left paying for this then we have made a terrible mistake in the regulatory system. End Quote

Can't argue with that. When and if we reach the stage of the present future of coal; that will change. In fact it already has; if you take the present share price of a company such as Crescent Point Energy Corp (and its half dozen trusts and associated entities that have been hived off.)

But a person could add that there is little chance in Sask that the landowner will be saddled with the whole costs of abandonment. Taxpayers as a whole .... quite likely somewhat. And has been stated previously; it is possible to deliberately drive cleanup costs to ridiculous levels apparently just to prove somebodies irresponsible standard of absurdness.

[bucket]

All a PST increase does is pay for other's mistakes....

If we didn't build a new stadium we didn't need....a ring road that wasn't required...or a GTH that has no future....

We are a province of soon to be back to a million or less....farms are consolidating ...oil companies leaving...farm equipment (thanks a billion) manufacturers setting up elsewhere...


Think about it ...Wall wasted a shitload of money on nothing to show for it and now we have to pay for it...

Criticize the NDP for doing nothing but maybe they lived within our means.