Truth About Norway And Why Canada Cannot Be Like It

[Anonymous]

Funny how academia/media/big labour/politicians no longer wants to talk about the virtues of the European welfare state model anymore. Not the beacon of self described progressive thinking it once appeared to be. Increasingly cheerleaders of high taxes and big government find refuge in talking about Norway. Why can't we be more like Norway? Look at Norway's GDP despite high taxes. It's becoming an increasingly popular mantra that can't stand a moment of scrutiny.



Norway is a country of five million people which is much less than half of Ontario's population. Yet it is the fifth largest oil exporter and the second largest gas exporter in the world. The benefit of which is shared by only five million people. Energy accounts for half of all Norwegian exports. For those desparate to emulate Norway, they should know that Norway is also the world's sixth largest exporter of military weapons.



The real kicker though is that the oil/gas money that is responsible for the country's living standards is produced in the North Sea. Since it is not landlocked with only one customer like Alberta oil is they get international pricing as well. The people that continually point to Norway as their poster child for a high tax regime would go nuts if we permitted offshore drilling in BC. Yet they say let's be more like Norway. Guess how Norway transports it's oil? Through a network of undersea and land-based pipelines. Yet the same people who violently oppose pipelines here say let's be more like Norway. That level of disingenuousness or ignorance is just too much to take.

[Romero]

People saying we should be more like Norway aren't talking about offshore drilling. Norway is smarter with its resources and shares the wealth with its citizens.

Norway produces 40 per cent less petroleum than Canada and has one-seventh our population, but has saved more than $600 billion in oil revenue and counting. This is equivalent to about 140 per cent of Norwegian GDP, or about $120,000 for every man, woman and child in the country. In contrast, every Canadian is in the red about $16,000 due to our $566-billion national debt.



Norway is debt-free, enjoys full employment and has fourth highest per capita GDP in the world. Canada is twelfth.



Benefits include free university tuition, universal day care and 25 days of paid holidays per year. Per capita spending on health care is 30 per cent higher in Norway; funding for arts and culture is more than three times higher than Canada.



How is all this paid for? Since the 1970s, Norway as a matter of policy has collected between 70 per cent and 80 per cent of the resource wealth generated from their oil industry through corporate taxes twice as high as Canada, and a special tax on oil profits. In Alberta, royalties collected on all oil sands production in 2010 were 10 per cent of industry revenues.



Norway also required that foreign companies train Norwegian workers, transfer proprietary technologies to their state-owned oil company Statoil, and in some cases even hand over producing oil platforms free of charge after a predetermined period.



This insistence on national participation has paid off. Companies controlled by the Norwegian taxpayer now directly own about 30 per cent of the nation's oil production, providing another significant source of income as well as technical input on how their resource is developed.



http://thetyee.ca/News/2012/07/25/Norway-Oil-Wealth/">//http://thetyee.ca/News/2012/07/25/Norway-Oil-Wealth/

First in a five-part Tyee series. Enjoy!



Hey, maybe if Canadians got more than a pittance we'd be more open to offshore drilling and pipelines.

[Anonymous]

Yes, the Norwegians are smarter than we are about their resource wealth. They have 1/7th our population and exported nearly 300,000 more barrels of oil/day than Canada. Not only that, but because their oil hits tidewater they can get Brent prices. What is Norway doing right that we are doing wrong? They have the proper infrastructure in place(pipelines) to get their product the prices they deserve.

http://upload.wikimedia.org/wikipedia/commons/thumb/9/9f/Chart-of-Oil-Trading-Nation.gif/800px-Chart-of-Oil-Trading-Nation.gif">

Rank Country Oil - exports (bbl/day)

1 Saudi Arabia 7,635,000  

2 Russia 5,010,000  

3 Iran 2,523,000  

4 United Arab Emirates 2,395,000  

5 Norway 2,184,000  

6 Iraq 2,170,000  

7 Kuwait 2,127,000  

8 Nigeria 2,102,000  

9 Canada 1,929,000  

10 United States 1,920,000



The key to oil wealth is exports. Something the Norwegians understand and something the North American left either doesn't know nor care.

[Romero]

What is Norway doing right that we are doing wrong?

Higher royalties around 70-80%. We should be getting at least 50%. It is our oil.

[Anonymous]

What is Norway doing right that we are doing wrong?

Higher royalties around 70-80%. We should be getting at least 50%. It is our oil.

What good are royalties when you can't even get your product to international markets and prices? Norway has an extensive network of pipelines in place to do that and we don't because people like you don't want that.

[Romero]

Norway's pipelines are all underwater and go short distances. Pipelines half or all way across Canada are pretty risky especially considering we only get 10% of the profits.



Much of the reason why BC doesn't want more pipelines is because there is so much risk for so little gain. Alberta gets its royalties, Canada gets its revenue and we only get a fraction of that.

[Anonymous]

Norway's pipelines are all underwater and go short distances. Pipelines half or all way across Canada are pretty risky especially considering we only get 10% of the profits.



Much of the reason why BC doesn't want more pipelines is because there is so much risk for so little gain. Alberta gets its royalties, Canada gets its revenue and we only get a fraction of that.

Actually underwater pipelines present a whole new assortment of risks that land based ones do not. NDT is a lot more difficult deep in the water than on land. Shorter pipelines are the ones that have been leaking or spilling the most by the way.



If BC(or Quebec) wants more revenue than you cannot deny us access to international markets/prices. The Norwegians are exploiting their natural resources wealth and so should we. Once it crosses BC it is up to the people there if they want to make some more money off of it, but keeping it in the ground benefits nobody. You can't have it both ways, either you exploit the resource the way wealthy states like Qatar, Abu Dhabi and Norway are doing or you keep it landlocked to only one customer at a low price which means less revenue/royalties.

[Romero]

Norway's pipelines are much safer. They're built much stronger and safety standards are much higher. Lots of regulation and transparency. How many spills have they had compared to our thousands?

Calgary-based Enbridge has offered improvements to its Northern Gateway pipeline to boost safety beyond "state-of-the-art," but British Columbia Premier Christy Clark is looking at a standard much further afield.



Clark said that Norway, one of the world's largest exporters of crude oil, is a model for rigorous safety standards and is perceived to have among the highest spill management capacities in the world.



"We're looking to those models and saying, 'They've minimized the risk, they've figured out how to do this, maybe we can do the same,'" Clark said earlier this week.



According to Norway's independent regulatory body, the Petroleum Safety Authority, safety standards are authored and strictly enforced by oil companies, unions and the government.



http://metronews.ca/news/canada/312396/b-c-points-to-norway-for-pipeline-safety/">//http://metronews.ca/news/canada/312396/b-c-points-to-norway-for-pipeline-safety/

I'm surprised you're such a fan of Norway's oil industry. 70-80% royalties, unions, lots of regulation, transparency and safety standards... if this started happening in Canada the oil companies would be pulling their hair out!



I wish we were more like Norway.

[Anonymous]

Actually, Alberta is a world leader in pipeline laying technology.

The review, conducted by Group 10 Engineering, included a comparison of Alberta's pipeline regulatory requirements with those of other jurisdictions including British Columbia, Saskatchewan and the National Energy Board in Canada; Texas, Alaska and the Pipeline and Hazardous Materials Safety Administration in the United States; and the UK, the Netherlands and Australia.



Findings

•All jurisdictions across Canada conform to pipeline requirements established by the Canadian Standards Association.

•Strict comparisons of regulatory jurisdictions across Canada are difficult to make since no two are directly comparable in terms of the type of pipelines they regulate.

•There is no "one size fits all" approach on how to best ensure pipeline safety.

http://alberta.ca/release.cfm?xID=34837BA1BC6E0-C585-A3BB-28688A4DAAB8B7F6%E2%80%A2Alberta">http://alberta.ca/release.cfm?xID=34837 ... F6•Alberta">http://alberta.ca/release.cfm?xID=34837BA1BC6E0-C585-A3BB-28688A4DAAB8B7F6•Alberta provides the most thorough overall regulatory regime of all the assessed Canadian jurisdictions.

•All regulators have an overall consistency in competence, understanding and preparedness for an incident.

http://alberta.ca/release">http://alberta.ca/release.

cfm?xID=34837BA1BC6E0-C585-A3BB-28688A4DAAB8B7F6

In fact, tiny Norway's vast pipeline network and proposed new pipelines will have engineers from Alberta designing them.

http://www.npd.no/Global/Engelsk/3-Publications/Facts/Facts2011/Chapter-14/Fig-14-1.gif">

Let us build a vast new oil infrastructure network like that and we will have coffers bulging at the seams.

BTW, even though Canada exports less oil than tiny Norway our revenues from it are higher. This is amazing considering their infrastructure ensures they get about $40+/barrel more than Alberta.

http://www.energyinsights.net/cgi-script/csArticles/uploads/139/Oil%20Revenue%20-%20per%20country%20in%202008.gif">

Yes, I am a big fan of Norwegian oil. Not as big as Qatar, but better than Canada. Norwegians exploit their resource wealth, build pipelines and export. You want Norway's wealth without the oil and you cannot have it both ways.

[Anonymous]

My husband has worked in Norway before on short term assignments and I joined him once..



Beautiful, clean cities with pretty architecture..



The countryside is pretty too with breathtaking views of the ocean..



However, Norway is the most expensive country I have ever been in or my husband has ever worked in..



My husband tells me wages for unskilled labor are higher than Canada, but for skilled help it is about the same..



My husband is a master electrician and we do well financially in Canada..



I don't think we would do as well in Norway with their higher cost of living and higher income taxes..



If you can afford it though, it is has some spectacular scenery.