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Lethbridge Herald, The (Newspaper) - September 19, 1973, Lethbridge, Alberta The LetKbrldge Herald VOL. LXVI No. 236 LETHBRIDGE, ALBERTA, WEDNESDAY, SEPTEMBER 19, 1973 10 CENTS FOUR SECTIONS 58 PAGES Premier Lougheed ...'a historic night' Ottawa 'would win' legal fight over oil tax CALGARY (CP) If the battle between the federal and Alberta governments over the 40-cent-a-barrel oil export tax came to a head. Ottawa would have the constitutional muscle to win, federal Energy Minister Donald Macdonald said Tuesday Mr. Macdonald was com- menting on the hard stand taken against the recently-an- nounced tax by Premier Peter Lougheed in a television broadcast Tuesday night The Alberta premier had de- scribed the federal export tax on Canadian crude as a "power play to try to control Alberta's oil ans gas resources." He vowed to fight the federal policy which he said would "divert from the province a substantial amount of money" and drastically harm the economy. The federal energy minister said once a province talked of moving a product across its borders, the matter became federal jurisdiction The premier, in fact, had toned down considerably from his earlier statement on the matter, he said. Premier Lougheed had said he would prefer to work in the best Canadian interest and this appeared to show he wanted to do business and not fight. Turning to the premier's an- nouncement that Syncrude Canada Ltd. intended to proceed with its development of the Athabasca oil sands, the energy minister said it was an important venture in that public participation was in- volved. Formation of the Alberta Energy Co through which Al- bertans could invest in Syn- crude was part of the agree- ment reached between the government and the oil com- pany. The public company, to be owned 50 per cent by the province with the remaining shares available to Albertans, could purchase 20 per cent of the operating plant providing Syncrude's operation was profitable. "The Alberta government profit-sharing scheme gave the province all the oppor- tunities for gain with none of the risks." Mr. Macdonald said he could not see why a provincial investment in the company would be any more subject to federal taxation than Ontario Hydro which was exempt. But he said the federal gov- ernment's attitude was not likely to change where the ex- port of synthetic crude oil by Svncrude was concerned. Seen and heard About town CAPTAIN Ron Butcher of the Salvation Army nurs- ing his wounds after backing into a hot water heater businessman John Edwards telling his fishing friends how to keep worms maggots thawed out during winter fishing: "Tuck them under your lip "I think it is fair to say that we have talked to one of the potential operators in the field here and our description of the long-term market indicated to him that perhaps he wouldn't have to seek assurances for synthetic crude oil (export tax exemptions I Suffield policy changed By AL SCARTH Herald Staff Writer In a dramatic shift of policy, the Alberta govern- ment went into the gas business at Suffield Tuesday, and offered Albertans the chance to buy shares in the venture. "The Alberta Energy Com- pany is going to have billion worth of Deputy Premier Hugh Horner told a Lethbridge Conservative ban- quet audience of 700. They had just finished watching Premier Peter Lougheed an- nounce formation of the com- pany in a pre-recorded televi- sion address. It was a day for surprises as banquet goers purchased their tickets with the expecta- tion they would see Mr. Lougheed in person. But the premier left an afternoon cabinet meeting here to fly to Calgary. An aide said the premier was taking no chances that Donald Macdonald, federal energy minister, would spring a surprise announcement on the province at an afternoon press conference in Calgary. A change in federal oil policy could have meant the pre- recorded broadcast would have had to be re-taped. The premier announced that the Alberta Energy Co. would participate in development of the massive Syncrude plant in the tar sands. He also said the company would be responsible for developing giant natural gas reserves at the Suffield military reserve. The move came as a sur- prise because the government had insisted until Tuesday that it had not made up its mind about how to develop the Suffield reserves. Ministers have said they were waiting for results of a drilling evaluation program before deciding about the field which could add 10 per cent to the province's total gas reserves. That evaluation is only partially complete There have been indications the government would enter the field in a small way. But it has repeatedly stated that a means for final development had not been decided upon. The alternatives were ex- ploitation by a private com- pany, a Crown corporation or a public company partially owned by Albertans. billion return seen Syncrude plant going ahead CALGARY (CP) Premier Peter Lougheed Tuesday again criticized Ottawa's planned export tax on oil, then said he hoped the federal govern- ment would pave the way for a billion develop- ment in Alberta's Athabasca oil sands. The premier, in a televised speech seen throughout the province, said the province would fight Ottawa's dis- criminatory tax move. He then announced Syncrude Canada Ltd. will proceed with a huge oil sands extraction plant provided the federal government co- operates by not imposing price regulations on synthetic crude oil. Describing the plan to levy the export tax as a federal "power play to control Al- berta's oil and gas resources." Mr. Lougheed said it was "clearly detrimen- tal" to Alberta and would result in the province becom- ing another "have-not" area of Canada. "We've been able to avoid a sales tax in this only province without a sales of the revenues from oil and gas." WOULD LOSE MONEY The proposed federal tax means money will be diverted from Alberta and siphoned off to be spent essentially in other parts of Canada, he said Construction of the im- mense plant, using workers near Fort McMurray in northeastern Alberta 225 miles from Edmonton, depends on federal co-oper- ation because the four- company consortium that owns Syncrude insists that synthetic crude be exempt from price regulation, the premier said. At the same time the prov- ince will be seeking Ottawa's approval of a new approach to calculating royalties. The province is to take 50 per cent of Syncrude's profits com- pared with present conven- tional royalties which average about 20 per cent of the gross production from oil fields. Royalties now are tax deduc- tible. "Surely, the federal govern- ment will not want to kill the Syncrude project at this point." Mr Lougheed said. Frank Spragins, Syncrude president, told an Edmonton news conference he is op- timistic Ottawa will be reasonable. "We just want the federal government to leave us alone. "We're looking for that decision not to interfere. If they will not restrain prices and our revenue, that's all we ask." He estimated the return to Albertans during the 25-year term of the agreement will be more than billion. FORM COMPANY Premier Lougheed also an- nounced creation of the Alberta Energy Co through which residents of the province will be able to invest in the Syncrude plant. Fifty per cent of the shares in the Energy Co. will be owned by the province and 50 per cent by Albertans. The company has an option to purchase 20 per cent the operating plant, the premier said Mr. Spragins said this op- tion could be exercised "anytime up until the plant is on stream, when it first comes into early in 1978. However, prior to the news conference. Mr. Spragins told a group of company employees the government option had to be acted on within "six months of the first train The plant eventually will have two such trains and the option clause carried a "lot more risk than Mr. Loughood indicated The Alberta Energy Co. would own 50 per cent of the power plant to serve the extraction plant and 50 per cent of the pipeline, also estimated to cost million, needed to carry the synthetic oil to Edmonton. The province also has stipu- lated that the native popula- tion of the area be given a chance to bo omplovcd at the plant and that the firm adhere to the environmental protec- tion measures required Future plan on display Lethbridge Chamber of Commerce past-president Leo Singer, and Dr. Hiram of the Lethbridge Research Station look over the model of the downtown redevelopment project, Lethbridge Centre, which now includes the provincial building in the foreground. The model of the provincial government's million part of the project was unveiled Tuesday at a luncheon for the premier and cabinet. Both models are to be on display at city hall. Inside Classified.........32-35 Comics.............. 28 Comment..........4 District.............. 23 Local News........21.22 Sports.............12-14 Theatres.............. 7 TV................... 7 Weather.......... 3 LOW TONIGHT 30-35, HIGH THURS. 65-70 CLOUDY PERIODS. 'She hasn 't stopped since an Osmond brother got married. Military cancels Chilean holiday underway No word on Agnew From AP-REUTER WASHINGTON (CP) VicePresident Spiro Agnew's office has rejected fresh speculation that he may resign, insisting instead that he is determined to clear himself of possible political corruption charges in Mary- land. Agnew himself refused to comment on the latest report that he was close to quitting, and- the White House also would not comment Repatriation program is Heath warning provokes IRA LONDON (Reuter) Prime Minister Edward Heath has touched off a political storm in Britain and Ireland by his warning Tues- day that Northern Ireland might have to be fully integrated with the rest of Britain Heath added later that his government hopes instead for a system that will allow Northern Ireland to manage its own affairs, with integra- tion only a last resort Heath's remarks provoked an immediate response from the violent Provisional wing of the Irish Republican Army (IRA) It said the war in Northern Ireland will be brought right to the doorstep of the English people if such a policy is proceeded with There was an outcry, too. from Britain's opposition Labor party. It urged Heath to clarify his statement to a television interviewer. South land office coming to city From REUTER-AP SANTIAGO (CP) Chile's new military rulers, in a fresh effort to restore the country to commercial efficiency, have decreed that Army Day normally a national a normal working day. tuesday was the 163rd anm- versary of Chile's independence from Spain and, as usual, most people stayed home. Chilean flags were hoisted in Constitution Square in front of the rums of the presidential palace, bombarded from land and air during a successful coup last Tuesday against left- wing President Salvador Allende. The new authorities, who have dissolved Congress and say they will rule without con- tact with political parties until they have "restored the country to appealed to the public to help trace several prominent sup- porters of the deposed Popular Unity government wanted for questioning "with regard to various crimes DACCA (AP) An Afghanistan jetliner chartered by the United Nations took off from Bangladesh today with 125 Pakistanis, beginning a repatriation program that eventually will move more than persons across the Indian subcontinent. The Boeing 727 was flying the Pakistanis to Lahore, in Pakistan, and was to return to Dacca with 125 Bengalis stranded in the west by the 1971 war that changed the former East Pakistan into independent Bangladesh. A regional lands office for Southern Alberta is to be es- tablished in Lethbridge. Lands and Forests Minister Allan Warrack announced Tuesday. The region to be covered by the new office will begin just south of Red Deer and Stettler and extend to the U.S border. Dr. Warrack said in a state- ment released after a cabinet meeting here. A regional land resource supervisor and staff will be responsible for supervision of sub-offices at Calgary and Medicine Hat Their respon- include overseeing the use of provincial lands, supervision of all surface ac- tivities associated with the oil and gas industry on Crown land and supervision of graz- ing and other leases. Conference GENEVA (Reuter) The European Security Conference agreed today on dates on which six Mediterra- nean countries will be able to air their views before it FDR's son linked to death plot WASHINGTON (AP) A convicted stock swindler says Elliott Roosevelt and a reputed big-time gambler offered him to assassinate the Bahamian prime minister. Roosevelt, son of the late President Franklin Roosevelt and once mayor of Miami Beach. Fla.. called the allega- tion "an utter and complete lubrication Louis Mastnana told the Senate permanent subcom- mittee on investigations Tues- day the assassination contract was offered because Prime Minister Lynden Pindling of the Bahamas is said to have refused to grant a gambling licence to Michael McLaney. Mastriana identified McLaney as a onetime employee of United States gambling kingpin Meyer Lansky. Mastriana served time in a federal penitentiary for illegal securities dealings in Florida and is serving an eight-year sentence for mail fraud in Texas Roosevelt, contacted at his Lisbon. Portugal ranch, said' "It is an utter and complete fabrication and outright lie made by a man who is a known con-artist and has been convicted, who has been put in jail, who has been adjudged by the courts of New Jersey as a mental incompetent, and who conned me and my associates at one time out of in Miami Mastnana said ho had had himself ruled insane purpose- ly "so I could do anything." Later, he said, "I was examin- ed by government psy- chiatrists who found me to be of sound mind and legally competent." Mastriana testified that McLaney, convicted in 1971 of a securities violation, gave million to Pmdiing for a 1968 political campaign. In return. Mastnana said. McLaney was to receive a gambling licence in the Bahamas "But ho didn't deliver." M.iMnan.1 said of the Baha- mian prime minister "They came to me and of- fered me to kill, to whack Pindling." Mastriana said Mastriana identified "they" as Roosevelt and McLaney. Mastriana said he was paid immediately. He said he received in a cheque trom McLaney to Roosevelt. A committee staff member produced photostaticcopyof a cheque for that amount sign- od In and Roose- velt ;