What are royalties for?

When Alberta’s Premier Ed Stelmach chose to up the amount of royalties companies were going to have to pay Alberta for extracting oil and gas the companies were outraged and Saskatchewan took advantage of that by opening its oilsands.

I have become more enlightened about what royalties are used for over the last few years. Only because the area I now live in has become swamped with pump jacks over the last five or six years.

Many people are making a great deal of money off of this venture, land is becoming very expensive and housing even more so. There are those who will and are taking advantage of this situation, oil and gas companies are in the lead.

What is not happening is the care to the system with the extra people coming into the province.

With more people, come more expenses. New housing developments take new sewer, new power and new development while older areas are overlooked. This always happens no matter where you are.

With more people there is more use of infrastructure and services.

http://www.oilandgasinfo.ca/wp-content/uploads/PW_august_2010.pdf

http://www.oilandgasinfo.ca/wp-content/uploads/PW_sept_10.pdf

Several examples of this are easy ones, like roads.

this was shortly after they "fixed" the pothole.

Sask. Transportation warns people of a danger spot with the "red flag"

Oil companies hauling the oil from the rigs take a toll on the surfaces of the roads and reconstruction/maintenance is always needed. This road is far from the worst in Saskatchewan, it is just one of the main roads I use. 

(Please notice the large chunks of asphalt that could be caught in a semi trucks tire and spit up at a vehicle following...that could cause one hell of an accident and who would know what caused it if there was no survivors. My last blog about the roads in Saskatchewan talks about this.)

Another is power.

With the rigs sucking the power out of the grid, I am sure that wouldn’t be the cause to peoples and businesses appliances burning out and break down with the surging and constant cutting in and out? No one is responsible for paying the cost of our refrigerators, freezers, washers and dryers, etc. being replaced or fixed because of this is there?

But adding more power to the grid will not do any good if the older infrastructure is not updated; something a government should have thought about 5 or 10 years before allowing companies to come in and suck the power right out from under their current customers...ahem... 

Updating the power lines and poles before allowing the rigs into the area would have made more sense. 

But sense doesn't always come into play when cents are involved.

http://thinkprogress.org/climate/2013/06/20/2187071/federal-government-charges-lower-royalties-than-many-states-for-oil-and-gas-drilling-taxpayers-lose-out/

(It looks like this is not just a Canadian issue…Go figure huh…yes, sarcasm)

Many people forget things like schooling and health care.

The men and women who work for these oil companies are not all single.

Many have families and these young children need schooling. It is no wonder the government cannot afford to pay its teachers more, but maybe had they demanded a better deal from the oil companies when it came to royalties your teachers would be getting paid a better raise over the next four years.

Some think that the teachers are asking for too much. I think those people are crackers!

Our teachers have to deal with 20 to 35 children in one class each day, some teaching more grades then one and teaching more than one subject. Many of those children have learning disabilities or are just downright disrespectful and should be dealt with by parents or police not by teachers.

We ask teachers to teach our children things that we as parents should be teaching our children; “we” do not have time to teach our own children anymore. Teachers, who are accused of not working enough days, getting too many long weekends during the year, having summer holidays and only having to work from 9 am to 3 pm…if only people knew.

Shadow a teacher for one 24 hour period and you will be sorely surprised at what they do in one day for our future!

Back to my original point,

Royalties are to help with the influx of people using the services and infrastructure in your communities. If you do not demand that the companies pay those royalties, they are not going to be generous and give them to you.

They may donate a little here and a little there to make themselves look good to the general population, but it NEVER amounts to what they should be paying to offset the cost of what their companies and their workers are using.

Health care is another biggie.

In the area I live there is a clinic that used to be a hospital. Not anymore. The closest hospital with an emergency is approximately 34 kilometers away and it isn't exactly what you would find in a larger center either. The doctor that comes to our little village once a week comes from that town. Once a week we can see this doctor or once a week we can see a RN.

With more people there is more demand on the doctor’s time.

The doctor out here is the only one, he deals with several small villages and towns in the area. He works his butt off in a very large area, so when I am sitting in his office I tend to bring a book…it could take awhile.

With the influx of people in the area this doctor’s office has a habit of double booking. I can understand many people can be rude enough to either demand to be seen immediately or they just don’t show up so staff get to know who might be a no show.

On one occasion, being as polite as I could, I had to remind a jerk that there were children present as he was complaining to another patient with the F-bomb every other word that the doctor’s office was double booking his appointment time.

Here is my point;

Once again, the overflow of people with jobs from the rigs has caused a massive amount of strain on services like doctors and teachers. It has caused substantial damage to infrastructures like roads and the power grid.  

Without the extra investment of royalties from the oil companies that are bringing in these issues, the issues are going to keep getting worse…not better.

Oil companies love free. They will rape Saskatchewan and move on. It might take years, but it will happen and in the mean time, it is the pee-ons that suffer. 

Land owners that rent to the oil companies don't suffer, they are getting well paid for the pump jacks being on their land. The government isn't suffering, they do not have to deal with cranky children or disrespectful patients. 

The lowly taxpayer who has new neighbors disrespecting his property, the doctor who has to deal with hundreds of patients with very little time off and the teachers who do not receive the respect and pay they deserve are the ones who suffer. 

http://desmog.ca/2013/02/28/if-canada-oil-rich-why-are-we-so-debt

(Our government is doing the taxpayers no favors. They are not working for us, they are working for the wealthy oil companies.)

Making any company pay to use the infrastructure and services that a province has only makes good sense.

Companies are not going to “take their business elsewhere” they have nowhere else to go! They need our resources, the longer the resources are in the ground the more they are worth.

If Norway can get 70 cents of each dollar an oil company makes, then why are we in Canada begging for pennies? 

There are many things that Norway does that Canada could follow examples of. Not having any foreign debt and having a "rainy day" fund sure does go to show they are a country worth watching and learning from, but will we?

Any company that wants to work in our country, take our resources, use our resources and bring workers into our country that use our infrastructure or our services need to start paying royalties.

That is where the royalties come in, they go to help alleviate the extra costs in fixing the roads, upgrading the power grid, hiring more teachers and doctors…

The important things that are needed and used.