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ENERGY: Suncor Energy calls for time to respond to new royalty framework arrangement

        (AlbertaIndex, October 26, Friday) --- Oilsands giant Suncor Energy said it needs time to respond to the Alberta government’s plans to implement a new royalty regime for the province.
 

        “Suncor recognizes that the oil sands resource we develop is owned by the people of Alberta, and Albertans have the right to benefit economically through royalties,” said Rick George, Suncor’s president and chief executive officer.

“However, the royalty regime changes proposed by the Alberta government are substantial and could have a significant impact on industry economics. We will need time to study the changes and their potential impact on our business.”

The government outlined plans to work with Suncor to reach an agreement on a transition plan to the new royalty framework.

“As an oil sands pioneer and a proud Alberta company, we will work with the government to find the right solution for Suncor and the people of Alberta,” said Mr George.

Suncor Energy Inc is an integrated energy company headquartered in Calgary, Alberta. Its oil sands business, located near Fort McMurray, Alberta, extracts and upgrades oil sands and markets refinery feedstock and diesel fuel, while operations throughout western Canada produce natural gas.

On Thursday, Premier Stelmach presented details of the new arrangement that could raise the province’s revenues by $1.4 billion per year. While this is lower than the $1.9 billion proposed by government-appointed six-member panel, the oil industry is deeply worried that the higher royalty will hurt the viability of their investments.

The new arrangement will be implemented in January 2009.


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