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‘Money for free’: Critics warn proposed Alberta well cleanup plan a royalty giveaway

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‘Money for free': Critics warn proposed Alberta well cleanup plan a royalty giveaway

EDMONTON — Critics fear Alberta’s new United Conservative premier is preparing to bring in a program that would use billions of dollars in taxpayer-funded royalty breaks to subsidize energy companies to fulfill their legal duty and clean up old wells.

The so-called RStar proposal, developed by an industry group, has been criticized by legal experts, energy economists and the province’s own internal analysts.

But for more than a year, Danielle Smith and newly appointed members of her cabinet have been outspoken advocates of the plan, which would enable companies to use reclamation spending to gain credits against royalty payments.

“I love it,” Smith said on a 2021 YouTube broadcast, when she was a lobbyist for the pro-business Alberta Enterprise Group. She also wrote a supportive letter that July as group president to then-energy minister Sonya Savage.

Peter Guthrie, now Smith’s energy minister, has expressed his support in the legislature.

“I’m encouraging all members of this house and the community at large to support RStar,” he said in April 2021.

On Oct. 22, the day after joining the cabinet, Guthrie told the Airdrie Today newspaper that RStar was one of his top priorities.

“RStar is a pilot project that incentivizes the cleanup and reclamation of wells, and in doing so, it creates a royalty credit for future drilling,” Guthrie told the outlet.

Other newly fledged cabinet ministers such as Jeremy Nixon of Seniors, Community and Social Services have also expressed support for RStar.

The Canadian Press has asked both Smith and Guthrie if they still support RStar. Neither have responded.

But critics say the idea appears to remain high on the agenda for the new Smith-run government.

“(Smith) has made it perfectly clear this is a screaming hot, flashing-neon priority for her,” said Regan Boychuk of the watchdog group The Alberta Liabilities Disclosure Project, whom Smith consulted on the program.

Under RStar, companies would earn credits for remediating old wells up to the total liability the well represents as calculated by Alberta’s energy regulator. That credit would then apply against revenue earned from new production to reduce royalties or be sold to another operator.

“It’s like moving more of your income into a lower tax bracket,” said Andrew Leach, a University of Alberta energy economist who has seen the proposal’s details.

Proponents say the program would encourage new drilling, help clean up Alberta’s 170,000 abandoned wells and create jobs doing both. In the letter written when Smith was still a lobbyist, she quotes a consultant who says $20 billion in RStar credits would create 366,000 jobs and $8.5 billion in royalties.

Critics aren’t so sure.

Leach said RStar would subsidize work that almost all companies do anyway as a legal condition of their drilling licence.

“The companies that are going to be able to take advantage of this are the companies that aren’t distressed,” he said.

“We’re not worried about companies that have active drilling programs and are meeting their reclamation targets. They’re doing exactly what they’re supposed to do and (we’d be) giving them additional credits with substantial value.”

There’s even less need for the program when oil prices are high, Leach said. He said it’s more likely $20 billion in RStar credits would simply cost the government $5 billion in foregone royalties.

Boychuk said in addition to transferring wealth to companies that don’t need it, RStar would use a taxpayer-owned resource to bail out hundreds of Alberta companies that have run their wells dry without cleaning them up.

“Danielle Smith’s program would hand them money for free,” he said. “It’s flabbergasting. It’s sheer robbery.”

Opposition New Democrat Energy Critic Kathleen Ganley said the plan reverses the foundation of environmental law.

“It’s a violation of the polluter-pay principle,” she said.

Ganley said there are no guarantees the program would create new work. Nor would it be open to scrutiny.

“There’s no clear, straight line that it would start new work as opposed to work that’s already underway except the public would be paying for it. And they would be paying for it in a way that’s not clear to them.”

Even Alberta Energy staff have expressed doubts.

In a June 30, 2021, letter obtained by The Canadian Press, Savage wrote to the Freehold Owners Association, a group representing private owners of mineral rights.

Savage, then energy minister and now in the Environment and Protected Areas portfolio, said: “The proposal does not align with the province’s royalty regime or our approach to liability management and upholding the polluter-pays principle.”

Nevertheless, said Boychuk, it may be coming Alberta’s way.

“It has been (Smith’s) personal priority for two years. Alberta is very close to having it rammed down its throat.”

Ganley warned that RStar could be brought in without going through the legislature — unless second thoughts prevail.

“One can only hope that being briefed on the file and having information from the department will assist them in making better decisions. Many might consider that optimistic.”

This report by The Canadian Press was first published Oct. 31, 2022.

— Follow Bob Weber on Twitter at @row1960

 

Bob Weber, The Canadian Press

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Florida State asks judge to rule on parts of suit against ACC, hoping for resolution without trial

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TALLAHASSEE, Fla. (AP) — Florida State has asked a judge to decide key parts of its lawsuit against the Atlantic Coast Conference without a trial, hoping for a quicker resolution and path to a possible exit from the league.

Florida State requested a partial summary judgment from Circuit Judge John Cooper in a 574-page document filed earlier this week in Leon County, the Tallahassee-based school’s home court.

Florida State sued the ACC in December, challenging the validity of a contract that binds member schools to the conference and each other through media rights and claiming the league’s exit fees and penalties for withdrawal are exorbitant and unfair.

In its original compliant, Florida State said it would cost the school more than half a billion dollars to break the grant of rights and leave the ACC.

“The recently-produced 2016 ESPN agreements expose that the ACC has no rights to FSU home games played after it leaves the conference,” Florida State said in the filing.

Florida State is asking a judge to rule on the exit fees and for a summary judgment on its breach of contract claim, which says the conference broke its bylaws when it sued the school without first getting a majority vote from the entire league membership.

The case is one of four active right now involving the ACC and one of its members.

The ACC has sued Florida State in North Carolina, claiming the school is breaching a contract that it has signed twice in the last decade simply by challenging it.

The judge in Florida has already denied the ACC’s motion to dismiss or pause that case because the conference filed first in North Carolina. The conference appealed the Florida decision in a hearing earlier this week.

Clemson is also suing the ACC in South Carolina, trying to find an affordable potential exit, and the conference has countersued that school in North Carolina, too.

Florida State and the ACC completed court-mandated mediation last month without resolution.

The dispute is tied to the ACC’s long-term deal with ESPN, which runs through 2036, and leaves those schools lagging well behind competitors in the Southeastern Conference and Big Ten when it comes to conference-payout revenue.

Florida State has said the athletic department is in danger of falling behind by as much as $40 million annually by being in the ACC.

“Postponing the resolution of this question only compounds the expense and travesty,” the school said in the latest filing.

The ACC has implemented a bonus system called a success initiative that will reward schools for accomplishments on the field and court, but Florida State and Clemson are looking for more as two of the conference’s highest-profile brands and most successful football programs.

The ACC evenly distributes revenue from its broadcast deal, though new members California, Stanford and SMU receive a reduced and no distribution. That money is used to fund the pool for the success initiative.

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The Canadian Press. All rights reserved.



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Australia’s Michael Matthews earns third win at Quebec cycling GP

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QUEBEC – Australian road cyclist Michael Matthews raced to victory at the Grand Prix Cycliste de Quebec on Friday.

Matthews earned a record third career victory in Quebec City. He was previously tied with Slovakia’s Peter Sagan with two wins.

The Jayco-AlUla rider won the fastest edition of the Quebec race on the UCI World Tour calendar.

Matthews, who claimed titles in 2018 and 2019, edged out Eritrea’s Biniam Girmay and France’s Rudy Molard in a thrilling sprint.

Tour de France winner Tadej Pogacar, the heavy favourite, was unable to follow through with his attack launched just over two kilometres from the finish line. He finished in seventh place.

Pogacar will look to redeem himself at the Montreal cycling Grand Prix on Sunday.

This report by The Canadian Press was first published Sept. 13, 2024.

The Canadian Press. All rights reserved.



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Whitecaps loan Herdman to CPL’s Cavalry, sign two reserve players to first-team deals

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VANCOUVER – The Vancouver Whitecaps have loaned midfielder Jay Herdman to Cavalry FC of the Canadian Premier League and rewarded two Whitecaps FC 2 players with MLS contracts.

Midfielder Jeevan Badwal signed as a homegrown player through 2027, with options for 2028 and 2029, while forward Nicolas Fleuriau Chateau signed an MLS contract through 2025, with club options for 2026 and 2027.

Both have been playing for the Whitecaps’ MLS Next Pro team along with the 20-year-old Herdman, the son of Toronto FC coach John Herdman.

The moves were made before Friday’s MLS and CPL roster freeze.

Born in New Zealand while his father was working for the New Zealand Football Federation, Jay Herdman was also part of the New Zealand soccer team at the Paris Olympics with three appearances including two starts. Herdman’s loan deal runs through the end of the CPL season.

“Jay is an important signing for us, who will provide another attacking option for the run-in,” Cavalry coach and GM Tommy Wheeldon Jr. said in a statement. “He’s a player that we’ve been tracking since we played against Whitecaps in pre-season and he has very good quality, with terrific energy and the ability to contribute to goals.

“With the recent injury to Mael Henry, Jay’s positional profile and age helps us with on-field options and minutes that count towards the league’s required 2,000 U-21 domestic minutes during the regular season.”

Badwal, an 18-year-old from suburban Surrey, is the 26th academy player to sign an MLS contract with the Whitecaps.

“Having joined our academy in 2019, Jeevan continues to progress through our club and takes every challenge in stride,” Whitecaps FC sporting director Axel Schuster said in a statement. “He is comfortable on the ball, positionally sound, and does the simple things very well. We are excited for Jeevan to make the next step in his young career.”

Badwal has made 19 appearances with Whitecaps 2 this season, scoring two goals and adding three assists. A Canadian youth international, he started all three matches for Canada at the 2023 FIFA U-17 World Cup

Badwal made his first-team debut off the bench in the first leg of the Canadian Championship semifinal against Pacific FC.

Chateau was originally selected 74th overall by the Whitecaps in the 2024 MLS SuperDraft after spending two years at St. John’s University.

The 22-year-old from Ottawa signed an MLS NEXT Pro contract with Whitecaps FC 2 in March. He leads Whitecaps FC 2 in goal-scoring this season with eight goals across 21 appearances (including eight starts).

“Nicolas leads MLS NEXT Pro in shots on target, has a very strong work rate and willpower. We are looking forward to seeing his growth as he builds on his young professional career,” said Schuster.

Chateau made his first-team debut as a second-half substitute at CF Montreal on July 6.

Herdman, who joined the Whitecaps academy as a 13-year-old, has made 19 appearances for Whitecaps FC 2 in 2024, scoring six goals and adding three assists. He made his MLS debut in April as a second-half substitute in a 2-0 victory at the Seattle Sounders.

Internationally, Herdman has represented New Zealand 29 times across the U-19, U-20, and U-23 sides. He was part of New Zealand’s squad at the 2023 FIFA U-20 World Cup, starting three matches at the tournament and scoring against Uzbekistan.

The Whitecaps host San Jose on Saturday while Cavalry entertains Atletico Ottawa on Sunday.

This report by The Canadian Press was first published Sept. 13, 2024

The Canadian Press. All rights reserved.



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