Download a copy of Boyd Russell's presentation at the January 12th SPE Technical Luncheon in Calgary, AB.
Calgary, AB, January 12, 2010 - The results of a detailed evaluation of the economics of a large shale gas field development do not bode well for Alberta. The evaluation, which compared the fiscal regimes of five main operating areas in North America, confirms what energy industry players have been asserting for some time: that changes to the Alberta royalty framework have put Alberta in last place in terms of competitiveness.
In a presentation today to the Calgary Section of the Society of Petroleum Engineers (SPE), Boyd Russell, President of Energy Navigator, determined that Alberta's current royalty framework would do little to attract new development or retain existing activity. "Alberta comes dead last when comparing the rate of return of shale gas developments across five major jurisdictions in North America," he commented. "Low rates of return can make large developments economically prohibitive in this province."
In an independent evaluation, Russell examined a multi-year, multi-well field that is typical of a development found in any of the five major North American jurisdictions including Alberta, British Columbia, Texas, Louisiana, and Pennsylvania. Mr. Russell notes, "Alberta is the least competitive jurisdiction. Even if gas prices rise, the potential for returns in areas of the U.S. increases significantly. The Alberta government's take is nearly double that of other jurisdictions when comparing after-tax cash flow for higher gas prices."
Energy Navigator develops software solutions that help more than 240 oil and gas companies make better decisions. AFE Navigator® and Value Navigator® provide efficient control and accountability for reserves evaluation, production, cash flow forecasting and capital cost management, ultimately assisting users in performing their jobs with the utmost speed and accuracy. Energy Navigator focuses on creating workflow solutions that enable the effective management of capital and reserve assets, helping companies to reach their full potential. The company's open philosophy and architecture design promotes workflow integration with other leading industry software. For more on Energy Navigator, visit www.energynavigator.com.
For media information or to book interviews:
Laura Brick, Marketing Manager
Energy Navigator Inc.
Phone: 403-233-9400
Email: lbrick@energynavigator.com