Alberta has improved its reputation as a place for oil and gas investment, according to a Fraser Institute survey.
The public policy research and educational organization questioned global petroleum executives and managers about barriers to investment in 147 oil- and gas-producing regions. Alberta was ranked as the 21st best jurisdiction in which to invest, and was third among Canadian provinces and territories.
In last year’s Global Petroleum Survey, Alberta placed 51st overall and was sixth in Canada.
A release issued by the Fraser Institute said the province’s higher ratings were mainly the result of an improved regulatory climate. In May 2011, the Alberta government announced plans to simplify its regulatory processes and procedures with respect to oil and gas drilling permits, project development and site remediation.
“Two years ago, Alberta ranked 60th in the world for oil and gas investment, the result of what the industry saw as an unexpected royalty grab by the provincial government,” said Gerry Angevine, a senior economist with the Fraser Institute and co-author of the survey. “Today, investors say they are less concerned about regulatory uncertainty, the cost of regulatory compliance, and regulatory duplication and inconsistency.”
The 10 most attractive jurisdictions identified in the 2012 survey were Oklahoma, Mississippi, Texas, North Dakota, Manitoba, Netherlands, New Mexico, Kansas, Denmark and West Virginia. At the other end of the scale were Bolivia, Venezuela, Iran, Russia-Eastern Siberia, Libya, Ecuador, Uzbekistan, Argentina-Santa Cruz, Iraq and Russia-other.
Manitoba was the highest-ranked Canadian jurisdiction, replacing Saskatchewan at number 1. It scored well on questions related to taxation, the cost of regulatory compliance and uncertainty over environmental regulation.
Nova Scotia was fourth in Canada, followed by British Columbia, Newfoundland and Labrador, the Yukon, the Northwest Territories, Quebec and New Brunswick.
“The Prairies offer the clearest, most consistent and most competitive policies for oil and gas investment in Canada,” said Angevine.
The Global Petroleum Survey is administered each year. For 2012, there were 623 respondents representing 529 companies who completed the questionnaire. Those companies account for more than half of the annual spending on petroleum exploration and production among international oil companies.
The survey covered such issues as royalties and other production taxes, taxation in general, the cost of regulatory compliance, trade and labour regulations, legal system fairness and transparency, and political stability.