June 2010

[Ally]

Alberta`s regulatory changes to save oil and gas sector $170 million

CALGARY - The energy industry will save as much as $170 million on regulatory changes already underway to streamline the system, the province announced Monday.

The work was highlighted in a progress report by a task force, set up as part of the province`s competitiveness review of the oil and gas industry.

"We`ve made progress addressing costly inefficiencies in the current oil and gas regulatory system while maintaining Alberta`s high environmental standards," task force chair and Drayton Valley-Calmar MLA Diana McQueen said in a statement. "Alberta is on track to renew our oil and gas regulatory system and make it modern, flexible, effective and efficient."

The report said savings for time and cost are being seen for both industry and government, while protecting environmental and safety standards.

Annual financial savings are estimated between $80 and $170 million, the report said.

Read the full article here.

 

[Ally]

By many yardsticks, our `Western Tiger` is no roaring success

EDMONTON - Alberta`s massive oil and gas wealth has made it an economic powerhouse. If one goes by standard measures such as average household income, GDP per capita or government debt levels, Alberta is in a league of its own. Which is why the TD Bank once hailed the province as Canada`s "Western Tiger."

But a new report on Alberta`s competitiveness -- prepared for Alberta Finance and Enterprise by PricewaterhouseCoopers -- paints a more mixed picture. Although it, too, ranks Alberta at the top of the class in living standards and economic well-being, it warns that the province`s future prosperity is far from assured.

In fact, Alberta lags behind many other jurisdictions in key areas like innovation, access to venture capital, labour productivity growth and the percentage of the working population with post-secondary degrees, the report notes.

"Government and industry both have a role to play in achieving sustainable prosperity. However, incremental changes, be it in government regulations or business R&D expenditures, will not be enough to achieve this desired outcome. A fundamentally different, more synergistic approach is required," it states.

The 23-page report benchmarks Alberta`s performance for the 2003-08 period against five other provinces, six U.S. states, and three advanced resource-based national economies: Norway, Finland and Australia.

Read the full article here.

 

[Ally]

Alberta retail sales to lead country

EDMONTON — Alberta`s economic outlook is brighter as the energy industry powers up and key sectors like retail sales and house construction recover from the recession, RBC Economics said Thursday.

RBC said Alberta`s economy is expected to grow 3.1 per cent this year -- up from the 2.5-per-cent rate it predicted three months ago. However, even with the improved forecast, Alberta`s real-GDP growth is expected to trail the national rate of 3.6 per cent.

And GDP, employment and retail sales won`t surpass the record levels of 2008 until 2011.

"The recession was particularly tough for Alberta`s economy, which contracted for the first time since 1986," said RBC chief economist Craig Wright.

"However, the recovery now looks to be taking shape, with a sharp rise in homebuilding activity and renewed interest in the oil and gas sector combining to fuel growth in the province."

Retail sales rose strongly in the first quarter of 2010, with new-car dealers reporting the biggest advance since mid-2006, according to RBC`s quarterly provincial outlook.

Read the full article here.

 

[Amber]

As slick spreads, oil sands beckon

A record of success in the Alberta oil sands and the oil spill in the Gulf of Mexico are expected to whet investors` appetite for a $1.25-billion initial public offering from MEG Energy Corp., the latest in a series of mega-deals from Canada`s oil patch.

After a decade of raising private money from blue-chip backers in Britain and China, along with his family and friends, MEG founder and chief executive officer William McCaffrey plans to take his company public this summer. MEG needs money to pay for a $1.4-billion expansion of its properties over the next two years that is expected to more than double the company`s oil production to 60,000 barrels a day.

While no one in the energy industry wants to be seen as profiting from the nightmare of BP PLC`s spill, MEG`s debut will benefit from the stability of the oil sands, which stands in contrast to the risks now associated with deepwater drilling. One investment banker working with the Canadian company said: "In the wake of what`s happened to BP`s platform in the Gulf of Mexico, investors are placing a premium on long-life oil properties that can be developed safely."

MEG employs what`s known as the steam-assisted gravity drainage approach to extracting petroleum from sand, a method considered to be the most environmentally friendly approach to recovering oil in the region.

MEG plans to list its shares on the Toronto Stock Exchange by August. None of the company`s existing owners plan to sell shares. Cash raised in the deal is earmarked for expansion.

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[Amber]

Alberta`s economy to rebound this year, lead nation in GDP growth: Scotiabank

Oil sands investment boosts forecast of 4.1% spurt

CALGARY - Alberta will experience a significant economic rebound this year and lead the nation in GDP growth, says a report released today by Scotiabank.

The report forecast GDP growth of 4.1 per cent for the province while overall Canadian growth would be 3.6 per cent, the strongest advance in a decade for the country. In 2011, Scotiabank is forecasting Alberta economic growth at 3.4 per cent - tied with Saskatchewan for the best in Canada. Nationally, it is predicting Canadian GDP at 2.7 per cent next year.

Scotiabank said a strong pickup in investment will fuel growth in the energy and manufacturing sectors this year in Alberta.

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[Amber]

Calgary`s residential MLS sales plummet in May: CREA

18.7% drop almost four times the national average

CALGARY - Residential MLS sales in Calgary plunged at a rate more than four times greater than the national average in May, according to statistics released today by the Canadian Real Estate Association.

The association, which represents 99,000 realtors working through more than 100 real estate boards and associations, said MLS sales of residential properties in Calgary dropped by 18.7 per cent from May 2009 to 2,133 units but the average sale price increased on a year-over-year basis by 9.2 per cent to $417,978.

At the national level, sales declined by 4.3 per cent to 47,369 units and the average sale price rose by 8.5 per cent to $346,881.

Across Alberta, CREA reported MLS sales fell by 16.1 per cent to 5,207 units and the average sale price was up by 7.1 per cent to $364,303.

CREA said the combination of changes to mortgage regulations in April and rising mortgage rates pulled forward a number of sales into April that would have otherwise taken place at a later date.

"Supply and demand has become more balanced in a number of major markets," said Gregory Klump, CREA`s chief economist. "Homebuyers now have more choice and are likely to be in less of a rush to purchase than they were recently, so the amount of time it takes to sell a home is expected to rise in the coming months."

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[Amber]

Debut Calgary mayoral candidate forum stirs secondary suites debate

CALGARY - Nine of the men vying to become Calgary`s next mayor agreed the city can solve the affordable housing crisis — as long the next mayor and council can break through the red tape, policy impasses and inevitable neighbourhood opposition.

The first mayoral forum ahead of the Oct. 18 election focused solely on housing issues. Except for a couple barbs at perceived frontrunner Ald. Ric McIver, it was a largely cordial first glimpse at the crowded field.

"It`s nice to see there are now nine affordable-housing advocates in the city," said candidate Wayne Stewart, former president of the Calgary Homeless Foundation. "We don`t need a new batch of ideas. We simply must do it."

Many mayoral contenders echoed similar policy options Monday at the Avenue Magazine-hosted forum: mandating affordable components of new residential projects, more cooperation among government and non-profit agencies and private builders, better use of city-owned land and easier approvals for apartment buildings.

Much of the discussion, however, centred around secondary suites, one of the most intractibly divisive issues the current council has grappled with.

McIver deflected heat from rival Naheed Nenshi about his recent proposal to consult on a new city-wide suites policy, after the Mount Royal business professor said the aldermen`s idea was a bureaucratic stall and that leaders need "guts" to help overcome NIMBY (not in my backyard) syndrome.

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[Amber]

Edmonton group to present plan for future of City Centre Airport

EDMONTON — A new group hoping to save the City Centre Airport plans to outline its proposal today for the facility`s future.

Envision Edmonton says it`s responding to Mayor Stephen Mandel`s 2009 call for people who support the status quo at the airport to tell council about their vision.

Councillors voted last year to shut one of the two runways, which is slated to close in August.

The entire facility might not be closed for another decade, depending on market demand for development on the 217-hectare property.

But the group, calling itself "an independent community organization formed by a group of local businessmen," says recent research shows 75 per cent of Edmontonians aren`t convinced closing the airport is a viable option.

"So why is it closing? Envision Edmonton is asking the same question."

Read full article here

 

[Amber]

It`s a renters` market in Alberta

Job slump, more home ownership push rents down, vacancies up

EDMONTON - A weak job market and people moving out of province pushed Alberta`s apartment-vacancy rates up and rents down in April, says a new report from Canada Mortgage and Housing Corp.

There is no more dramatic example of the softening rental market than Grande Prairie, where the vacancy rate skyrocketed to 14 per cent from 8.5 per cent a year earlier.

The average monthly rent for a two-bedroom apartment in the northwestern Alberta city plunged by $118 to $851 in April.

The Grande Prairie area posted both the province`s highest vacancy rate and the largest decline in rents, according to CMHC`s Spring Rental Market Survey released Tuesday.

"We`ve been in business for about 20 years so we`ve seen the cycles over the years, but this one has definitely been the quickest and most dramatic," said Mark Rousseau, client relations manager with Grande Prairie-based Prime Property Management.

"We went from a vacancy rate of virtually zero to about 15 per cent overall in Grande Prairie in a very short period of time."

Read full article here

 

[Amber]

Oilpatch gushing over royalty changes

Praise for the latest Alberta`s royalty-regime handouts is piling up at a Calgary oil and gas symposium, with only a persistently low natural gas price keeping the cap on the bubbly.

Energy companies presenting at this week`s Canadian Association of Petroleum Producers investor showcase say new incentives designed to encourage drilling in unconventional plays will pay off in some cases in millions of dollars per well.

Jeff Tonken, chief executive of Birchcliff Energy, a Calgary-based company with unconventional oil and gas assets north of Grande Prairie, said Thursday the new royalty incentives are "very significant."

"Under the new rules, when we drill wells that are deeper than 2,000 metres, which is 80 per cent of our lands out there, we now get royalty credits from 2,000 right up to 5,000 (versus the 2,500-metre cutoff under the previous temporary program)," he told investors.

"And the effect, depending on the price of natural gas and depth of the well, gives us on the low side $2 million and the high side $3 million of royalty credits per well."

Read full article here

 

[Amber]

Alberta`s economy to rebound this year, lead nation in GDP growth: Scotiabank

Oil sands investment boosts forecast of 4.1% spurt

CALGARY - Alberta will experience a significant economic rebound this year and lead the nation in GDP growth, says a report released today by Scotiabank.

The report forecast GDP growth of 4.1 per cent for the province while overall Canadian growth would be 3.6 per cent, the strongest advance in a decade for the country. In 2011, Scotiabank is forecasting Alberta economic growth at 3.4 per cent - tied with Saskatchewan for the best in Canada. Nationally, it is predicting Canadian GDP at 2.7 per cent next year.

Scotiabank said a strong pickup in investment will fuel growth in the energy and manufacturing sectors this year in Alberta.

Read full article here

 

[Amber]

Apartment rental rates dropping, vacancies rising, in Calgary: CMHC

CALGARY - The average rental apartment vacancy rate in Calgary has risen from a year ago but rent has also declined, according to the spring Rental Market Survey released today by Canada Mortgage and Housing Corp.

The agency said Calgary`s vacancy rate went from 4.3 per cent in April 2009 to 5.3 per cent in April of this year.

At the same time, average rent for a two-bedroom apartment fell to $1,082 from $1,106.

Nationally, the survey of Canada`s 35 major centres, saw the vacancy rate increase slightly to 2.9 per cent from 2.7 per cent.

"Rental construction and competition from the condominium market added upward pressure on vacancy rates and historically low mortgage rates attracted renter households towards home ownership over the last year," said Bob Dugan, chief economist at CMHC, said in a news released.

Results of this survey reveal that, in April 2010, the centres with the lowest vacancy rates were Quebec City (0.4 per cent), Regina (0.8 per cent), Winnipeg (1.0 per cent), and St. John`s (1.1 per cent). At a provincial level, Manitoba and Newfoundland and Labrador posted the lowest vacancy rates at 1.0 per cent and 1.1 per cent, respectively.

Read full article here

 

[Amber]

Alberta economy to lead Canada in 2011: TD Economics

Alberta`s economy will lead the nation next year, according to a report released today by TD Economics.

The bank`s Canadian Economic Outlook report said the province`s real Gross Domestic Product growth will be 3.5 per cent in 2011 after a 2.8 per cent hike in 2010.

In 2009, during the recession, Alberta`s economy contracted by an estimated 4.9 per cent from the previous year.

TD Economics is forecasting real GDP growth of 3.6 per cent this year and 2.5 per cent in 2011 for the entire Canadian economy.

Read full article here

 

[Amber]

Calgary`s residential MLS sales plummet in May: CREA

18.7% drop almost four times the national average

CALGARY - Residential MLS sales in Calgary plunged at a rate more than four times greater than the national average in May, according to statistics released today by the Canadian Real Estate Association.

The association, which represents 99,000 realtors working through more than 100 real estate boards and associations, said MLS sales of residential properties in Calgary dropped by 18.7 per cent from May 2009 to 2,133 units but the average sale price increased on a year-over-year basis by 9.2 per cent to $417,978.

At the national level, sales declined by 4.3 per cent to 47,369 units and the average sale price rose by 8.5 per cent to $346,881.

Across Alberta, CREA reported MLS sales fell by 16.1 per cent to 5,207 units and the average sale price was up by 7.1 per cent to $364,303.

CREA said the combination of changes to mortgage regulations in April and rising mortgage rates pulled forward a number of sales into April that would have otherwise taken place at a later date.

Read full article here

 

[Amber]

Relief available for beetle damage

Grants help pay for replacement pines


EDMONTON — Mountain pine beetles don`t stop devouring trees when homes and communities get in the way.

But now Alberta residents, private landowners and municipalities who lose trees to mountain pine beetles can apply for financial help to plant replacements.

Under the new Alberta Mountain Pine Beetle ReLeaf program, urban dwellers, small landowners and municipalities can apply for discounts toward the cost of replacement trees.

It`s a partnership of Alberta Sustainable Resource Development, not-for-profit group Tree Canada and business sponsors Telus and Strive Energy. The partners collectively contributed $100,000 to start the program off. New sponsors and individual donors are also being sought.

"We`re dealing with a lot of the forests in and around communities and this is where people live and play and make a living," said Mike Rosen, president of Tree Canada.

Trees add beauty, filter air and water and reduce energy bills for buildings, he said.

Read full article here

 

[Amber]

Alberta`s June land sale best in five years

Drilling Rights - Alberta has posted its biggest June sale of oil and gas drilling rights in five years, auctioning rights to 58,000 hectares for $55 million.

That works out to an average of $947 per hectare, compared with $178 per hectare in June 2009.

The last bigger June land sale occurred on June 29, 2005, when $70 million was raised at $733 per hectare.

Read full article here

 

[Amber]

Real estate rebels now free and clear

ComFree couple sells out, moves on

EDMONTON - ComFree is now Holowach-free.

Travis and Erin Holowach, who revolutionized Edmonton`s real estate market by helping owners sell their homes privately without paying agent commissions, have sold the company to DuProprio.com, a Quebec-based company.

The Holowachs, who started out flipping houses, have been synonymous with ComFree since December 2002, when the couple bought the Edmonton and northern Alberta franchise of the company, which started in 1996 in Winnipeg.

ComFree charges a flat fee starting at $697 for a package that includes in-home consultation, legal advice, signs, and web and magazine ads. A typical real estate agent would take seven per cent of the first $100,000 of the sale price and three per cent on any amount above that.

The Edmonton franchise grew quickly as the resale market heated.

By 2007 when the market was slowing down, the Holowachs` office had expanded its staff to 71 from 33, and accounted for about 30 per cent of all homes for sale in the region, according to their numbers. A year later, in a cooled market, their staff had fallen to 58, but they still bought and moved to a new office double the size of their former location.


Read full article here

 

[Amber]

Edmonton industrial real estate `healthy`

Demand rising despite vacancy hike: report


EDMONTON — A slight rise in Edmonton`s industrial real estate market`s vacancy rate hasn`t dented the overriding optimism for the rest of the year, a new report says.

The 0.2-per-cent first-quarter rise to 4.4 per cent came as companies started to find their balance after a tough 2009, says Avison Young`s spring report.

A stronger economy, boosted by recovering energy prices, has helped stabilize the marketplace as businesses adjust to the new economic realities of a recovering Alberta, Avison Young principal Rob Iwaschuk said.

"Our research indicates that despite the small increase in the overall vacancy rate, there is still a healthy demand for top-tier industrial space in the city.

"Rental rates have stabilized, and companies that may have been sitting on the sidelines in 2009 are re-entering the marketplace prepared to make real estate decisions with growth in mind."

However, history has shown the need to look forward with caution, he said.

"While demand for industrial space appears to be rising, lease rates continue to face downward pressure due to the extraordinary amount of sublease space available."

Read full article here

 

[Amber]

Number of EI recipients in Alberta drops for sixth straight month

CALGARY - The number of Albertans receiving regular Employment Insurance benefits in April declined for the sixth consecutive month, reported Statistics Canada today.

The federal agency said that number dropped by 2,500 people during the month to 49,900.

And Calgary experienced its first year-over-year decline in EI beneficiaries since the beginning of the economic downturn in the fall of 2008.

Since the peak of June 2009, the number of beneficiaries in Alberta has fallen by 20.6 per cent, the second fastest rate of decline after Ontario (26.5 per cent), said Statistics Canada.

In April, 667,400 people across the country received regular EI benefits, virtually unchanged from the previous month. The number of people receiving regular EI benefits has declined by 161,900 since the peak of 829,300 reached in June 2009, a drop of 19.5 per cent.

"Claims have generally been declining since their peak in May 2009. Although there was little change in April, the number of claims received has declined by 30.5 per cent since the start of the downward trend in May 2009, with the fastest rate of decrease in Alberta (41.1 per cent), Ontario (37.9 per cent), and British Columbia (23.6 per cent)," said the federal agency.

Read full article here

 

[Amber]

Cenovus striving for 300,000 bpd by 2019

Company eyes `decades of growth`

CALGARY - Canada`s newest heavy oil player says it has the assets, people and plan to push the company past 300,000 barrels per day by 2019.

Speaking at the company`s inaugural investor day open house, Cenovus CEO Brian Ferguson outlined a 10-year strategy aimed at placing the company at the forefront of the in situ oilsands industry by touting "marquee assets" at Christina Lake and Foster Creek.

"It is quite literally an opportunity base that will provide us with decades of growth," he told reporters following the meetings.

Ferguson described the open house as the company`s "debut," coming six months after its split from Encana Corp. in December.

The rationale for the split was to create two stand-alone companies worth more than the sum of its parts, but the combined pieces have barely gained about 10 per cent since they began trading.

On Thursday, Cenovus`s shares gained a penny to close at $30, while Encana jumped 49 cents to $35.61 for a combined $65.61, compared with the pre-split closing price of $57.63 and well off the $100 level when the split was first proposed in 2008.


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