Friday, December 04, 2009

Question for Ed "#asked"

Premier Stelmach has asked Albertans to "ask Ed": on twitter using #asked questions. I had inquired about potential hydrocarbon exploration incentives in September of this year. I will reissue my question to the Premier using this new media referring to this blog page. Below is my email to AlbertaConnects@gov.ab.ca, Premier Ed Stelmach (http://www.premier.alberta.ca/contact/contact.cfm) and my MLA Alana Delong (Calgary.Bow@assembly.ab.ca):

Ms. Delong,

I see that the provincial government is extending energy incentive programs:
http://www.theenergynews.com/news/article.php?storyid=4607&newstype=gov

This is all fine and good, but there is another sector of the energy industry that is not targeted -new exploration.

New oil and gas exploration employs many more people than existing exploitation and leads to extraction jobs as well. Seismic jughounds, surveyors, geophysicists, geologists, accountants, landmen, regulators, natives, seismic processors, and more are hurting just the same if not more than the actual producers.

I believe that there should be an exploration incentive, not just an exploitation and drilling incentive. This would open up new areas for production in Alberta and also be forward-looking into the future for further energy provincial supplies.

Is the government considering any incentive plans for new exploration?
If not, I believe that when the upturn finally happens, there will be a lack of qualified personnel for real hydrocarbon exploration in Alberta due to companies shutting down operations.

Cheers,
John
Note: Employment numbers may not be accurate, but my point was that there are many related downstream jobs created from exploration.

I received a quick (automatic?) email response from my MLA and AlbertaConnects. AlbertaConnects forwarded my letter to the Department of Energy, from which I have received no response. Sadly, only Ms. Delong responded directly. She left a phone message at my house and followed up with another email requesting my mailing address to which she sent the following letter (opens in a new window or tab):


Clearly, Ms. Delong and/or her staff did not understand that in order to have "rig crews and drills in the ground", exploration must occur. She missed the whole point of my communication. You cannot willy nilly get a rig and drill and pump in random locations in Alberta (and pay royalties)! In order to have future reserves - even oil sands reserves - there needs to be some form of new exploration. Unfortunately, this economic downturn has had devastating impact on the exploration side of the business. In many service companies, over 50% of staff have been let go. Entire G&G (Geology and Geophysics) departments of oil and gas companies have been disbanded.

The tone of Ms. Delong`s mail implied that the government is only interested in current cash flow and not future cash flow. For Alberta to be successful there needs to be new reserves on the horizon, not just depleting current reserves. My thoughts were for government to provide companies with forward looking ideas for finding Alberta`s new reserves, incentives to reach those goals, just as they are providing the companies that have already been down that route and are now drilling or pumping.