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Saskatchewan and B.C. stand to benefit from “capex leakage” as producers divert capital away from Alberta exploration programs out of fear of the new NDP government’s review of oil and gas royalties, says a new report from energy analysts at TD Securities.

The much-criticized 2007 Conservative royalty review resulted in several negative consequences for the Alberta energy sector that took years to recover from and could easily be repeated, the research note published Monday says.

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“The outcome of the most recent royalty review in 2007 was the unintended consequence of sabotaging producer spending in the province — the data supports this without doubt, in our view,” it reads.

“Ultimately, we saw B.C. and Saskatchewan earn their fair share of producer spending and it took the Alberta government a number of revisions and incentive programs to ultimately undo the negative impact of the royalty review in 2007.”