Energy Navigator tools analyze proposed Alberta royalty changes

Tristone Capital report leverages Value Navigator to show ‘tax disincentives’ of new regime.

Energy Navigator Inc. has released a new version of its Value Navigator suite of engineering, fiscal modeling and economic tools. Value Navigator 4.7 includes independently verified royalty calculations based on the new Royalty Framework for Alberta. The new release will assist Canadian operators evaluate their projects in both the old and new royalty regimes to see, for instance, if projects are still economically viable and if changes need to be made to 2007 year-end reserves.

Tristone Capital

A recent report from Tristone Capital made intensive use of test builds of the new Value Navigator to study the impact of Alberta’s new fiscal regime. The detailed analysis of the impact of the new royalty framework for Alberta claims that the Alberta Department of Energy has failed to assess how Alberta’s regime compares with others, that the data used was ‘out of date and incomplete,’ and that the new proposals will cause government revenue to fall by $2 billion by 2010. This is due to tax disincentives—Tristone cites EnCana’s $1 billion spending cut as a proxy for the ‘risk to Alberta’s revenue and broader economic growth.’

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