Lethbridge Herald, The (Newspaper) - May 17, 1973, Lethbridge, Alberta
Pricing policy serves all Canadians Thuraday, May 17, 1973 THE lETHBRIDCE HERALD 5 The following is part of the address made on May 7 by Premier Peter Lougheed to the Empire and Canadian Clubs of Toronto. Alberta's new natural gas pricing policies have been in- troduced in the best interests of the Canadian public. In November of last year the Alberta government announced new natural gas policies for Al- berta which included the direc- tive that there would be no fur- ther removal of gas by permit from the province unless and until all the gas purchased in Alberta was being purchased at fair market value. Since that time there has been extensive increases in the cost of competitive fuel, parti- cularly crude oil and the present value of Alberta nat- ural gas contracts may now be substantially less than even the 60 per cent of fair value of last August. In understanding Alberta's position it is fundamental to keep in mind that we are deal- ing with a depleting resource- owned essentially by the people of Alberta. Our position has raised a number of particularly in central Canada which I would like to res- pond. First, there has been concern expressed about our comple- mentary plan to rebate to Al- erta consumers from the trea- sury of the Alberta government as a provincial fiscal govern- ment measure, such amounts as will assure that Alberta users of gas will have a net cost lower than in other parts of Canada. In other words it's not a two price system in the strict sense of the word but a one price system with a pro- vincial government rebate, not unlike a homeowners' tax dis- count or a property tax credit used by some provincial gov- ernments. It can hardly be con- sidered a restraint on interpro- yincial trade when carried out in this fashion. In actual the fiscal purpose is to use the advantage of low cost energy to stimulate indus- trial development to replace Al- berta's reliance upon depleting resources and secondly, to provide a dividend for the peo- ple of Alberta as a return for their ownership interest in the resource itself. A second concern that has been mentioned is that the ma- jority of the benefit of the in- creased gas prices would go to the gas producing companies rather than to the people through their provincial gov- ernment. This contention is in- valid en a number of counts. Firstly, the government has clearly announced that it in- tends shortly to sharply in- crease the royalty rates for nat- ural gas, as it has already done for crude oil. The crude oil rates were increased by approximately 50 par cent last year and now amounts to about 22 per cent of the gross value of production. It is important to underline that that's a per- centage of the gross value of production not of the net val- ue of production. Without committing our- selves but using comparable royalty rates for natural gas fact is that the provincial government would receive off the top without any risk whatsoever more in revenues on an average basis than the gas producing com- pany would make in profits. That can hardly be considered other than a good deal for the ownership interest. The govern- ment does not participate in the hundreds of dry holes. In addi- tion, the province receives sub- stantial revenues for land sales and rentals which are essen- tially rights to explore. In addi- tion, the province would gain in a very substantial way with higher gas prices through a positive impact upon the total provincial economy and in par- ticular, even greater drilling activity. In addition, the prov- ince would receive greater tax revenues from the higher wages and salaries which would accrue to the many citi- zens involved directly or indi- rectly with the petroleum in- dustry. All Canadians would of By Alberta Premier Peter Lougheed course benefit from the income taxes paid on such increased wages and salaries. It should be noted that Al- berta is one of only three prov- inces paying into the equaliza- tion pot for less fortunate prov- inces. The stronger the Alberta economy the more it is able to participate in equalization. The source of such equalization funds is significantly from in- come taxes on earnings of citi- zens. I could list numerous oth- er economic benefits. A further question arises what happens to the profit por- tion from the higher prices accruing to the gas producing companies? The vast majority is re-invested in further ex- ploration efforts, not just in Al- berta but in federal lands in the North and off the coast of Nova Scotia. A healthy petroleum in- dustry is a very positive part of the Canadian economic sit- uation. There is also the im- portant balance of payments benefit from the revenues from the sale to the United States of our oil and gas. use its sources of supply to provide below value gas to cen- tral Canada and that in due course the federal government should use its federally owned northern land to provide high cost gas to the United States. If that's equity for Alberta, then confederation is really in trouble. Another matter raised is the interpretation that such a pol- icy satisfies the narrow Alber- ta public interest but is not in the broader national public in- terest. This simply is not so. At 16 cents per Mcf a very large portion of possible gas reserves are beyond economic reach. The president of the Alberta gas trunk lines recently sug- gested that over five trillion cubic feet of new reserves would become economic in the event prices are substantially increased. At 16 cents per Mcf it simply is not economic to drill for gas in the sour gas fields of the foothills in Alberts. Unless the prices are increased substantially t b ew e reserves will be lost as assets for Can- ada. Under current low price conditions the proven reserves of natural gas in Canada are declining and declining for one reason only too low an average price! Let me dispose briefly of another point that had been raised that Alberta should A further response has been that the increase would not be so bad if it was not so dra- matic and all of a sudden. The fact is, that the proposed in- crease is merely a catching-up process. Statistics Canada re- ports that the price index for domestic gas in Toronto on the basis of 1961 at 100 and this may surprise you has been constant at precisely 99.1 for each year during the entire pe- riod between 1962 through to 1972. Residential consumers of Canadian natural gas have gen- erally enjoyed at the ex- pense of Albertans a very remarkable price stability re- lative to other consumer prices. A minimal 10 per cent per Mcf increase now would represent a catching-up of only about one- fifth of the rate of price in- creases of other commodities to Canadian consumers during the last ten years. Another response has been that such price increases might jeopardize the competitive in- dustry position in Ontario with the United States. It is true that the vast increases in demand for Alberta gas have been by industry, not residential con- sumers. Between 1967 and 1971, the use of Alberta gas by On- tario residential users in- creased 22 per cent while the use of Alberta gas by Ontario industrial users increased by 90 per cent so, the industrial ar- gument is probably the key is- sue and has to be looked at. But the facts do not bear out the argument. Assuming gas constitutes about 23 per cent of Canadian energy consumption the proposed gas price in- crease would produce a cost in- crease to industrial consumers of about 15 per cent to 35 per cent of their fuel cost. But fuel costs are a very small portion Mcc weather for Ducks. When it comes to your favourite Andres Duck, pleasure knows no season. Andres Cold Duck, a beautiful blend of champagne and burgundy. Or Andres Baby Duck, the happy marriage of a robust, red wine to a delicate, sparkling white. Whatever the weather, now's the time to get quacking. ANDReS SPARKLING BABY.DUCK ANDRES WINES (AlBERTA) LTD.. CALGARY. CANADA o ANDRES WINE (ALBERTA) LTD of total industrial costs thus the cumulative influence on the value of all goods manu- factured in Canada would be about seventeen one hun- dredths of one per cent. I think Canada is strong enough to handle that! For certain indus- tries where gas costs are more of a factor, the cost of compe- titive energy sources is also rising dramatically. Note the recent 25 cants a ban-el in- crease in the price of crude oil. As far as the United States competition is concerned for central Canadian industry, it's apparent that all energy costs are going to rise dramatically in the United States. It will not be limited to merely new gas. To the extent energy costs are a factor in even with doubling natural gas costs in Alberta at the field our long term competitive position in my view Mill be stronger not M'eaker compared to the Uni- ted States. The real issue is where new industry should be located. These are all reasonable re- sponses to our position even if they are, in my view, with little substance. There is however, another one that makes Alber- tans angry. It is that Ontario did Alberta a great big favor in accepting the national oil pol- icy some ten years ago and us- ing Alberta's crude oil rather than the "stable sources" such as Venezuela, Iraq and Iran over the past ten years so that M-e should continue now to sell our depleting natural gas re- serves under value to balance the transaction. Well, for a start, how about the extra cost of central Canadian con- structed a g r i c u 1 ture imple- ments sold to the farmers of Alberta over the past few dec- ades. How about other tariff- protected items? How about the fact that without the national oil policy there would not be to- day reserves of Canadian gas or oil for us to talk about of any significance or even prospects for northern devel- opment because without the national oil policy industry would have gone elsewhere in the world. Then there is the position of certain minority groups that we should use short term slightly cheaper maybe) insecure foreign crude for east of the Ottawa Valley to provide revenues to the gov- ernments of Venezuela, Iraq and Iran and to hold in the ground and not sell any Alber- ta oil to the United States but store it for the time when- net, these foreign sources are cut off or become exorbi- tant. Confederation? Not by a long shot! Finally, there Is the sugges- 1 tion hard to call it an argu- ment that Alberta should sell its gas on a cost-of-pro- duction basis not at Morld market or commodity values. Well, come with me to talk with the farmers of Alberta about thai one they'll pro- vide you with a bill of dec- ades of duration it will he large and have two parts the first part would be the dif- ference between their actual cost of production over the years and the world grain prices they have the second part would be the cost they actually paid for man ufactured products based on world market values and what the cost of buying sim- ilar products would have been on an actual cost-of-production basis. I doubt Canada would want to pay a bill of that mag- nitude. Let me return to the posi- tive. We recognize Alberta gas pricing policies are significant and that they merit serious re- v i e w and discussion. But thoughtful Canadians M'iJl not emotionally or illogically respond or place the issue out of perspective. Significant as the matter is it's not in the same category at all with ma- jor Canadian economic ques- tions such as international monetary changes, federal tax- policies, the development of the Athabasca tar sands, world grain prices or other such major economic issues. In short, I submit, there has been an over-reaction an exag- geration cf the Alberta gas pricing proposal and its im- pact upon the consuming areas. Let me leave you with this thought. I make no apologies for expressing to you today some very strong Western Ca- nadian and Alberta view's contemporary 1973 views. T doubt very many of you expect- ed otherwise. But, I ask you lo about this would it not be good forCanada if the West yes, and Alberta with its energy resources in particu- lar became a much stronger part of the Canadian nation economically in jobs in population and in social terms? I hope your conclusion is yes. Eve and Women's Lib By Kathleen Barrows MILK RIVER Adam lived alone in his garden. At times he felt a vague feel- ing of dissatisfaction with his solitary life among the vegetables along with an occa- sional petunia or two. He thought it would be nice to have a companion to work with him, cook his three squares and talk with him at times. So he spoke to the Lord about it, and the Lord put Adam into a sleep, took out one of his ribs (neatly fix- ing up the hole afterwards) and built it into a woman. Adam was well pleased with his new wife and he called her Eve. One day a wily old serpent came along and persuaded Eva that she would become exceedingly wise if she ate some of the fruit from the tree of knowlege, which was the one tree the Lord had forbidden them to touch. So the Lord was very angry with them and drove them from their garden inU> the Land of Nod. As Eve's punishment the Lord told her that her husband would rule over her. In the Land of Nod they took up a home- stead and farmed. One day when Adam was busy meticu- lously marking straight rows in which to set out his tomato plants, he looked up and saw his neighbor, Adam II, come loping over the hill just a-bursting with excite- ment. Now Adam I didn't particularly care for Adam n and his laissez-faire methods of fanning, but still a good gossip was always welcome so he leaned on his hoe and pre- pared to listen. "There are great goings on in the vil- lage." said Adam II. "The women are all rebelling and demanding equal rights with men. They're talking about something call- ed Women's Lib. They don't want to stay home and take care of their children, but want to go out into the world and have equal opportunities with men. They don't want to obey their husbands any more." said Adam I. "Why the Lord himself said I was to rule over Eve! She was the one who couldn't stand up to temptation when the serpent came along. I never told you this before but that's how I lost my homestead out west of here in Eden. She could never manage on her own out in the big wide world. Any wily old serpent that came along could talk her into anything without me there to look cut for her. Even Paul in the good book well he hasn't written it yet but he Mill as soon as he gets around to being born says it is meant for women to keep silent and not usurp authority over men. Paul says women should be keepers of the home, obedient to their husbands. He doesn't say anything at all about this thing called Women's Lib." "Well I don't know anything about what the Lord said to you over in Eden, or about said Adam II, "but the women are sure kicking up an awful fuss. And your Eve is the M'orst of the lot and is leading the parade." "Well I wouldn't worry about it." said Adam I, complacently going back to his tomato plants. "Nothing will ever come of it. It says so right here in the book." Well, so much for women's Lib. ANDY RUSSELL What a grizzly eats WATERTON LAKES PARK As late as 1964 grizzly bears were classed as preda- tors by some top authorities, but it is a very misleading kind of labelling. For the grizzly, like man. the hog and the common rat is an omnivore. In short the big ani- mal will eat most anything, but if it de- pended pn preying on other animals for its food the species would have been long since extinct. A grizzly is just too big and conspicuous to be successful in stalking prey. Being an opportunist of the first or- der, the grizzly Mill occasionally kill large animals to eat M'hen conditions are right, but the consistent killer of cattle or hoofed game is a specialist wrought by accident and circumstance and a rare individual. I recall one bear that killed a cow one spring not far from where I live. She had two small cubs. The stock association trap- per proceeded to set a trap for her a black bear trap unsuitable for holding a grizzly nntl she pulled out of it. That summer she went on a killing binge and avoided men and traps with cunning and great success. The following spring she was caught again in the same trap, but again she pulled out this time hurting her foot. This put the finishing touches on what was likely the most destructive bear the Alberta Rockies ever saw. Over a two-year psriod she killed 16 yearlings for one ranch alone and her total score ran into damages amounting to thousands of dollars, before she was finally trapped and killed. But she was only one bear and had things bec.i managed right at the be- ginning, she would have been stopped long before her cunning became honed to such a fine edgs. Most grizzlies never learn to kill any- thing bigger than a marmot. They are 85 to 90 per cent vegetarian and this is no theory shakily built on guess work. The scats of grizzlies have been picked up and analyzed minutely over wide areas by trained scientists. This decs not mean they Mill not eat meat, for all bears are inordinately fond of carrion, missing no opportunities to dean up any kind of dead animal. They are the clean-up squad of Mild country, a fact that has got the grizzly into plenty of trouble for they will claim and eat livestock found dead from any cause. Many ranchers, upon finding a carcass obviously being fed on by a grizzly, b'amc the bsar for the kill, when the cow really died from something clss. While doing a very comprehensive study of the grizzly a few years ago, this writer had opportunity to study the feeding pat- terns of this animal all the way from the 49th parallel near MThere the Alberta-British Columbia border joins the north rim of Montana clear to the central mountains of Alaska. In spring, M'hen they come out of their den, they concentrate on digging roots, eating bugs and grazing on favorite kinds of lush growth. As summer comes, they largely concentrate on grazing, and I have spent many hours watching and filming big bears feedng exactly like cattle. As summer progresses and the berries begin to ripen they turn to eating wild fruit, but if the berry cup is inadequate they seek out low damp ground and proceed with their grazing. In the fall they go back to digging roots, excavating for squirrel caches of pine nuts and hibernating ground squirrels. There are few things they enjoy eating more than ground squirrels and they spend hours dig- ging for them. By the end of October, they are usually loaded with fat and proceed to dig their wintering den. Sometimes in parks and around various tourist and industrial campgrounds, the grizzly becomes conditiond to eating gar- bage, and M-hen the grizzly becomes de- pendant on hand-outs, the results are hu- man-bear confrontations that get wide pub- licity. This is one of the most damaging and dangerous developments that can do great harm to the species, and is the re- sult of what amounts to gross human care- lessness and poor management. It is unfortunate that we allow this, for the grizzly is a grand animal that is very intelligent and enterprising. The big bear will lean over backward to avoid trouble with people. If people would do the same, there M-ould be little trouble with grizzlies. On th e use o f word i! woras Theodore Bernstein Everyday use. The simple use doesn't enjoy the popularity it should. Richard Menzies of Salt Lake City thinks there is a conspiracy afoot to kick it out of the language. That may be an extreme view, but there can be no doubt that the fanciers of the fancier word those who, lo sound impressive, prefer the long word to the short one shun it M'hen ttey shouldn't. They are the ones M'ho would say, "He utilized a screw-driver to clean his fingernails." There is a use for utilize, but that's not it. The principal meaning of utilize is to put to profitable use, as in, "The cdly will utilize its garbage as land- fill." Then there is the struggle between ti.se and usage. The longer word-fanciers M'iU say, "The authorities have no reliable data on the effects of marijuana usage." when they mean simply use. The meaning ot usage is customary or traditional prac- tice. In both instances it's not merely a matter of using the simpler word; it's also a matter of using the precise word and avoiding the imprecise word. Get out. Should you get married? Mrs. Marvin Harris of Little Rock, Ark says no. She's talking about the -words, of course; she has nothing against marriage. And up to a point she's right. Merc than 60 years ago Ambrose. Bicrcc asserted that if it is correct to say got married, we should also say got dead for died. But at- tempting to banish the expression alto- gether is loo extreme. There are occasions on M'hich it is necessary to use the locu- tion. One authority on usage offers this example: "He is married now, but I can't. tell you when he got married." Such are ram but they do come up.