Sustainable growth

[cowman]

We hear all this rhetoric from various political sources about how we need "sustainable growth", or how can we slow down the over heated Alberta economy?
By next spring, I suspect, we might be hearing a different story! Right now the energy sector is in full mode slow down! The rigs are being parked, pipelines scheduled aren't being built, projects are being put on hold or being scrapped! A representative for a large drilling company specializing in CBM wells told me two thirds of their rigs are idle right now and they see almost zero activity in the second and third quarters of 2007!
In other words very soon all those boys who went out and paid the big bucks for houses, trucks, etc. are going to find it very difficult to make the payments!
This rep also told me in the big picture they need more money for natural gas. He thought $9 might be a good long term price but to expect a sharp price increase in late 2007? He estimated it would rise to around $20!That is just the boom and bust of the oil and gas business? Always has been that way?
I certainly hope some of our dumber politicians don't try to slow down this economy? The market has a way of doing that right now?

[coppertop]

I don't necessarily agree with your information source cowman. As long as oil holds around $60.00 a barrel things will keep on moving.My son is so busy he can't even get a day off, and his work consists of working over old wells to get them back into production. I spent a few days up in the Peace Region and anyone that thinks things are slowing down should take a trip up Highway 43 and on up Highway 2.

I, for one, hope natural gas prices stay where they are, at least the consumer gets a break. As for gasoline prices they went from 89.9 in Fairview to 79.3 in Whitecourt this week.

[cowman]

coppertop: Oil certainly hasn't fallen as hard as NG? It went from $78 to $60 while NG fell from $15.78 to close to $4! Now NG has come back some without a doubt but still fairly borderline to being profitable?
Not too hard to shut off or reduce flow? And definitely not too difficult to stop creating more?
The best cure for low prices...is just that...low prices? Farmers could really learn a lesson or two on how the NG business is responding to these low prices? Cut the supply until the demand catches up!
While consumers might(and that is a definite MIGHT) get a break on prices this winter you can be assured they will pay dearly for it down the road! With reduced exploration and production this coming year what will the price be next winter? Certainly a lot more than this winter! Simple supply and demand economics?

[coppertop]

It's all a game isn't it cowman? Still, if we can save a few dollars this winter that is a bonus.

[cowman]

If we save a few dollars? Actually we lose a lot of dollars collectively?
20% of $6/g gas is $1.20? 20% of $15 gas is $3? So in fact, as a province we lose $1.80 a gigajoule?
Now I realize most people might not see it that way, but it is a fact?
If all resource royalty revenue was divvied up to the owners(the people of Alberta) we might not be so happy about low prices?
Personally I think the government should operate on the premise of living within their means and relying on taxes to pay the bills and leave the real property of resource royalties in the hands of the owners? That just might wake a few people up to the reality of just how expensive government has become? It is out of control with no end in site!
Do we really need the government taking care of us? I would suggest most people are very capable of taking care of themselves without the government dragging them down? Just my opinion.