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British Columbia pledges more aid to entice spending
Gary Park
The British Columbia government has taken its latest step to improve the climate for crude oil and natural gas production in the province’s petroleum-rich northeast region.
Premier Dan Miller announced incentives that include C$103 million over five years to upgrade roads and extend the current 100-day winter drilling season, along with reduced royalties to extend the production life of marginal wells.
Over the last 18 months the province has made a stream of announcements to place itself on a competitive footing with Alberta. It has relaxed regulations to speed up project approvals, reduced gas royalties, introduced heavy oil royalties specific to the province and pledged increased funding to upgrade highways.
C$25 billion in new investment The objective is to achieve C$25 billion of new investment over the next decade and double gas production to 4.8 billion cubic feet per day by 2008.
A British Columbia government official said the royalty amendments should increase the government’s petroleum revenues to C$550 million a year from C$393 million in the 1999-2000 fiscal year.
Pierre Alvarez, president of the Canadian Association of Petroleum Producers, said the incentives could make this winter “one of the most active years in B.C. drilling history.”
But he warned British Columbia’s competitiveness is threatened by a unresolved aboriginal issues, including compensation for trappers whose livelihood is jeopardized by energy activities.
Indian leaders said they are poised to cancel drilling agreements with exploration companies unless British Columbia and the federal government negotiate a settlement. Miller said he is willing to meet with the aboriginals at any time, but the uncertainties remain.
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