After two years of angry dueling over royalties, grim investment and job cuts triggered by fallen oil and natural gas prices, spectacular revenue reverses that smeared the provincial budget with red ink, a stinging byelection defeat in Calgary, and a slow but steady slide down the political popularity polls, Alberta’s Conservative government is out to mend its business fences. A competitiveness study of policy details is maturing into a sweeping inquiry into industry conditions.

A projected $2 billion in temporary royalty cuts to halt a slump that cut drilling in half is only the beginning. “We are undertaking a complete review,” says Barry Rodgers, executive director of economics and markets in the provincial energy department. The government’s biggest corporate critic accepts the olive branch and voices encouragement to follow through with action. “They want to do a better job,” says EnCana Corp. executive vice-president Mike Graham, chief of Canadian operations for North America’s top gas producer. “They’re going about it the right way.”

By happening in an international business arena, the meeting of minds highlighted the government’s determination to reach out and win back friends. Rodgers and Graham crossed paths at a fall Calgary event called Playmakers, which was held for industry and investment insiders by Houston-based PLS Inc., a petroleum listing service, as a description of its role as an oil and gas counterpart to the real estate sector’s MLS network of properties and brokers.

The occasion included rare public appearances – and even rarer consent to answer blunt questions – by senior civil servants from the Alberta, British Columbia and Saskatchewan energy departments.

In spreading encouraging words, Rodgers does not dwell on contrasts to a confrontational approach that was a hallmark of Alberta’s 2007 public royalty review panel. The group was led by an Edmonton chairman drawn from the forest products sector and an international royalties consultant who is regarded in Calgary oil and gas circles as a known advocate of increasing government “takes.”

Rodgers emphasizes appointments of two elder statesmen of the Calgary energy business community to the competitiveness review panel, and stresses that Premier Ed Stelmach himself is making the rules for the new inquiry.

Representing oil and gas companies is Roger Thomas, who recently retired as executive vice-president and chief of Canadian operations for Nexen Inc. His credentials include terms as chairman of the Canadian Chamber of Commerce and president of the Alberta Chamber of Resources, cradle of the developer-friendly oil sands net profit royalty regime. The financial community is represented on the competitiveness panel by Christopher Fong, who recently retired as the Royal Bank of Canada’s managing director of corporate energy banking. Originally an engineer, he is also a director of Anderson Energy Ltd., the firm of Calgary gas drilling and development dean J.C. Anderson.

The competitiveness review’s chairman is Alberta assistant deputy energy minister David Breakwell. Rodgers is project manager. The group’s starting point is to regard industry, finance and government interests in Alberta oil and gas as equally legitimate, he says. “The vision is to get all the facts on the table and create a process for informed dialogue that is committed to understanding the objectives of all three.”

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