The Saskatchewan Progressive Conservative Party rolled out further details regarding their plan to assist the provincial oil industry, especially the new and small producers, which in turn would impact all oilpatch sectors.
Paul Carroll, the PC candidate in the Estevan constituency will join the party’s leader, Rick Swenson in Weyburn this morning (March 16) to discuss the concept behind the announcement.
“If the new oil producer is a registered Saskatchewan business and files Saskatchewan income tax and pays the one-time registration fee of $10,000 (all producers are required to do that), they can apply for a special delayed fee exemption, under our plan,” said Carroll. “The new plan would require them to only pay something between 10 to 20 per cent of the licensee liability rating (LLR) fee, and make installment payments on the balance” The LLR fees are funds directed towards well abandonments.
“What the Sask. Party hasn’t told the general public is that they have been charging the oil industry, by way of this levy, and this money was to have been directed toward the abandonments. Now, where is that money? That, of course, is answered when you look at the Saskatchewan, budget,” Carroll said.
By being able to pay LLR fees in installments, there would be an allowance for asset title transfers, giving the new producer an opportunity to pay the balance from well production. In the event the price of oil returned to the $60 to $65 per barrel range, then the balance would become due, under the PC program. Using this model, Carroll explained, “only small independent producers or new startups would be affected.
“We were looking to create something to assist new oil companies or small producers, and I believe we found it,” said Carroll.
“We cannot overlook environmental concerns and the industries have programs in place to reduce or eliminate the negative impacts on the world. They also contribute billions into our economy.”
Carroll said in this constituency and in the southeast, there is oil, coal, natural gas and the power stations that are all huge employers, and their employees spend money locally on housing, education and consumer products. They pay their taxes and “every job of an exported product helps create at least another five jobs.”
“If you’ve been following the news lately, you’ve heard about orphan wells. I’ve heard that many require abandonment and reclamation, so let’s move forward,” Carroll added.
The PC candidate said when the orphan well program was implemented, the price per barrel of oil was much higher, and at that time, with no expectation of a sudden price drop to such catastrophic levels.
The current orphan well program is complex and confusing which, he said, “is typical of government agencies. The current program favours large oil producers.”
He said he was well aware there will be people who will say the millionaires in the oil industry don’t need help. “Well, we are not helping them. We are helping create jobs by putting people back to work and that’s everyone’s right,” said Carroll. “And let’s not forget, this plan places no burden on the taxpayer.”
Carroll said anyone wishing more clarification on the party’s orphan well plan, is welcome to visit him at their campaign office that has been set up in the 1200 block of Fourth Street.
