• 4 minutes Will We Ever See 100$+ OIL?
  • 8 minutes Iran downs US drone. No military response . . Just Destroy their economy. Can Senator Kerry be tried for aiding enemy ?
  • 11 minutes Energy Outlook for Renewables. Pie in the sky or real?
  • 11 hours Shale Oil will it self destruct?
  • 8 hours Berkeley becomes first U.S. city to ban natural gas in new homes
  • 1 min Today in Energy
  • 2 days Excellent Choice: Germany's Von der Leyen Secures Powerful EU Executive Top Job
  • 13 hours Oil Rises After Iran Says It Seized Foreign Tanker In Gulf
  • 22 hours Populist, But Good: Elizabeth Warren Takes Aim at Private-Equity Funds
  • 23 hours Mnuchin Says No Change To U.S. Dollar Policy ‘As of Now’
  • 2 days Migration From Eastern Europe Raises German Population To Record High
  • 1 day Washington Post hit piece attacking oil, Christians and Trump
  • 2 days White House insider who predicted Iran False Flag, David Goldberg found dead in his New York apartment
  • 13 hours Why Natural Gas is Natural
  • 2 days Germany exits coal: A model for Asia?
  • 9 hours LA Solar Power/Storage Contract
Oil Prices Rise Amid Further Rig Count Decline

Oil Prices Rise Amid Further Rig Count Decline

Oil prices inched higher on…

Revenues For Canada’s Oil Towns Dwindle As Firms Stop Paying Taxes

Calgary Alberta

A new discontent is brewing in Canada’s oil patch—insolvent oil firms or energy companies trying to stay afloat amid low Canadian oil prices have started to lag in municipal tax payments or have stopped paying taxes altogether, The Globe and Mail reports, noting that losses on missed tax payments could be in the tens of millions of Canadian dollars.

Although there aren’t precise figures about how much money municipalities in the provinces in Alberta and Saskatchewan are losing from laggard oil tax payers, the potential revenue decline has started to cause a discord between municipalities and oil companies, The Globe and Mail notes.  

Municipalities across Alberta and Saskatchewan have few options to enforce tax collection because oil and gas firms lease the land on which they drill, which leaves no property of a laggard tax-payer that the municipality could seize and sell in order to recover the payments.

Municipalities in Saskatchewan are calling on the provincial government to take actions against companies that have lagged in tax payments or such that have stopped paying municipal taxes altogether.

“It’s a pretty big issue. We’re concerned that the problem is actually going to get worse,” Ray Orb, president of the Saskatchewan Association of Rural Municipalities, told The Globe and Mail.

On the other hand, some in the oil industry argue that municipal taxes, unlike provincial taxes, do not reflect the fact that production from oil and gas wells drops over time, because municipal taxes are fixed.

Related: The Battle To Control Russia’s Pipelines

This year hasn’t been kind to the Canadian oil patch—production has continued to increase, but takeaway capacity has shrunk and spare pipeline capacity has virtually vanished, causing a steep drop in Canadian heavy oil prices.

At the beginning of December, Alberta’s government enacted a mandatory short-term oil production cut in Canada’s oil patch effective January 1, in a bid to address the record-low Canadian heavy oil prices due to constrained takeaway capacity.

As of January 1, 2019, Alberta will be curtailing production by 325,000 bpd, or by 8.7 percent, to reduce market volatility and drive Canadian oil prices up, Alberta’s Premier Rachel Notley said in early December.  

The 325,000-bpd production cut is expected to take three months.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment
  • Eric on December 27 2018 said:
    Houses for sale (everyone should have a house). That is the general thinking of majority of population and that mindset was installed by the financial institutions to boost thier own interest to lend money (that is how they make money). People actually mortgage away thier money making lives to pay for a home that is the family money-pit. Banks win. Over the course of a mortgage (25 years) people are robbed of thier wealth-building years to feed into bank wealth creation. At the end is a home that has cost at least double the purchase price in interest, principle, maintenance, taxes
    If you cannot pay any of those the loss is only for homeowner no way to walk away unscathed. Why do governments, elected by the people that risk all, bailout banks and oil companies? Is there no revolt in North Americans?

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play