Royalty review panel holds first session in Grande Prairie

A review of Alberta's royalty regime officially began Monday in Grande Prairie, the first in a series of public hearings across the province.

Bill Hunter, chair of the review panel, says it is time to examine the formula used to calculate the amount energy companies pay the province for extracting non-renewable resources from the oilsands.

"Over the last15 years, and more specifically in the last 10, unprecedentedly the oil price has taken off and it leads everyone, I guess,to say 'Is the existing system appropriate?'"

The review started off slow Monday, with only six people making presentations.

Tim Presber, whoowns a small Calgary resource company producing 100 barrels of oila day, flew up to Grande Prairie to talk to the panel.

"On the overall royalty regime, don't mess with it. Don't change the overall take. If you want to tinker with redistributingwhere the money comes I don't have any problems with that."

But Bernie Smashnuk, a farmer,said Albertans are being "short changed."

"These people are taking record amounts of profits out of this country and leaving us with infrastructure that's very expensive. With the hot economy comes high prices."

The review panel will also hold public meetings in Edmonton, Calgary, Fort McMurray and Medicine Hat. A report with recommendations will then be handed over to the provincial government at the end of August.

Premier Ed Stelmach promised to review the royalties during his campaign to replace Ralph Klein as leader of the Alberta Conservative party.

The government received more than $14 billion in oil and gas royalties in the last fiscal year.

Undera regime introduced a decade ago to try to encourage companies to invest in the oilsands,companies pay a one per cent royalty on their revenues until their initial investment is paid off. The royalty then jumps to 25 per cent.