The proposed changes for carbon tax emissions and the royalty review will begin to take their toll in the first quarter of the year.

The year 2016 will not be kind to oil and gas and its supporting industries. You do not need psychic powers to predict the casualties 2016 will bring. The proposed changes for carbon tax emissions and the royalty review will begin to take their toll in the first quarter of the year. Investment dollars will be retracted, and financial institutions will be forced to demand re-payment on assets that are now under water. Many of our small and mid-sized oil and gas producers who invested prior to seeing the commodity price fall will be forced either into foreclosure or forced to sell off their ‘A’ class assets. This may provide them with just enough cash reserves to prolong their existence for a few more months or to be consumed later by one of the surviving sharks in the Alberta pond.

To the average consumer of information, it would appear the acceptance of the climate policy by giants, such as CNRL, Census, Shell, and Suncor, represent the community at large. In fact, the opposite holds true. These giants fall into an emission output of more than 100,000 tonnes and are provided a tax break to mitigate the impact upon their business. Those who fall below this output are encouraged to opt into their larger competitor’s programs to receive this same tax break. However, when has a competitor such as these mega-corps provided this without cost?

Not only will they receive a tax break, they will also monetize the management of the emissions from the small fish in the pond. In the end, those who do not have sufficient cash reserves will be forced to capitulate.

You cannot stop a machine that is in full motion and not expect massive damage. There must be a middle ground to accommodate rationale change.

To deny climate change is important or that we as a community should not become better stewards of our habitat, would be absurd. However, it is equally absurd to make drastic changes to the industry without consideration of the economics that drive not only our province but influence our national economy. For decades now, the dirty commodities, like the tar-sands and coal, have been quietly paying for our social system, healthcare, and education. The problem must be solved by dialing production back proportionate to the introduction of new forms of renewable power. In what seems to be a blind effort to follow through on campaign promises, the NDP has pushed forward with a climate policy that was supposed to provide a mechanism to meet a global initiative and yet avoid the transfer of wealth outside of the province. When you look further into the policy, there will likely be only one successful measurement. There will be no transfer of wealth outside of the province as most current ventures will cease to be profitable. The ventures will be abandoned and new opportunities will be sought out in other tax friendly jurisdictions.

Today, we face a particular aggressive environment. A Government that is most certainly not an advocate of our oil and gas industry is making sweeping changes that will ripple out for years to come and impact not only our businesses but also our fellow Albertans personal wealth. A particularly aggressive branch of environmentalists who advocate for mass moratoriums upon the industry has monopolized the media with its angry and offensive stance. You cannot stop a machine that is in full motion and not expect massive damage. There must be a middle ground to accommodate rationale change. Those who promote a diminished dollar must also be cognizant that our dollar can only fall so much before foreign investment in our economy slows. At this point, the additional growth in manufacturing and our export industries will cease to be profitable.

It is possible to ‘stay alive’, but to do so, we must accept the current environment as it is. We must embrace change. The ‘norms’ of the past decade no longer exist and are not likely to return soon. If your fear of change is stronger than your fear of failure, you and your organization are not likely to survive.