Royalty Review Panic in Alberta

"...the introduction of changes.  For he who innovates will have for his enemies all those who are well off under the existing order of things, and only lukewarm supporters in those who might be better off under the new.'' Machiavelli

The social media sphere is alight with opinions about the Alberta NDP and Premier Elect Notley's plan to initiate a royalty review. Many conservatives are on a warpath about even the mention of a royalty review. There is much doomsday talk out there, which is unfortunate since this makes reasoned debate, quite scarce and hard to find, amidst the fearmongering. 

I think everyone in Alberta by now knows the importance of the oil and gas sector, and we all know that timing of the royalty review is important- however we all agree it has to occur soon. So in the midst of this nuanced context- we cannot have media hounds like O'Leary or oil execs losing their beans and using illogical idiotic, and completely ridiculous arguments every time royalty reviews are mentioned- we and I mean the collective we, are the owners of these natural resources along with the seventh generation. These resources are not ours to waste and give away at fire sale prices just to benefit us in the next quarter. The premier is looking at the needs of this province 10-20 years from now. There are no conversations that are out of bounds in Alberta, as we make these sorts of generational decisions- not in our democracy. We need to have a conversation about the amount of Royalties we are getting out of a very finite resource right away. 

The intricate mechanisms of capital investment, government R&D that continues to help these companies with tech that they use in oilsands extraction, the stable and secure environment where the rule of law and contracts is respected in Alberta/Canada- and more, all make it extremely unlikely that your major oil and gas players will leave. Alberta is just too good a place to invest. These media pundits in their quest to fill the airwaves seem to forget that during their hyperbolic arguments. 

As Albertans and owners of this resource we have a duty to make sure we are assertive, transparent and prepared to have fierce conversations. The business decision making cycle is about reducing risk to capital and having a predictable investment environment- you have this in spades in Alberta. Aside from the global dynamics around the price of oil- Alberta offers a way for capital to stay safe- and allows access to a well educated workforce- along with world class infrastructure. All this costs money, corporations particularly in the oil and gas sector are a part of the picture in revenue generation and have to pay a fair royalty for our resources. We need to establish what that fair royalty looks like. 

Albertans are an entrepreneurial people, they don't believe in corporate welfare. As players in a market economy we know viscerally that if a company cannot make money because of its own cost structure we have no obligation to bail it out by giving away the resource. You have to be bloated beyond reason not to make money in this province in the long run. Corporations know this in Alberta. We have an incredible business environment- one which can withstand a fierce negotiation. 

The returns to capital are incredible here in Alberta, when looked at in the long term. Even in the current volatile price environment of $60+ a barrel- after much time at $100+ a barrel- you have much room for reasonable margins. During my conversations with numerous oil and gas players it's clear that prices would have to stay below $40 a barrel for a prolonged period of time for the majors to get in trouble- we were nowhere close to that price point other then a few weeks-during the worst of times. 

Let's also not forget that this is also one of very few jurisdictions in the world where you have oil and gas extraction and exploration conducted through private business with magnificent returns and where the majority of activity is not controlled by government activity. Many other options outside of the United States and Canada require operating in extremely corrupt and volatile conflict ridden environments like Yemen, Nigeria, Russia etc etc in conjunction with state owned companies. You combine all these factors and you have an attractive investment environment here in Alberta despite a review. So the royalty conversation has to take place- sooner rather then later. The environmental questions and our duty as vice regents of creation also has to be taken seriously. But that is another post. 

Apple watch the least important announcement that Apple made today.

Jeff Williams, Apple’s senior vice president of operations launching Research Kit

The Apple watch is the least important announcement that Apple made today. 

The Research Kit that Apple unveiled today is perhaps one of the most significant contributions to medical science research in a generation. The problem with research has always been the difficulty with which subjects can be recruited for studies. With 700 million apple phones 6 and 6s out there, the methods with which subjects can be recruited with appropriate sampling and data coherence is significant. This will inevitably lead to better understanding of the causal architecture of many diseases simply by the potential access to rich, nuanced and accurate data. 

The potential of what Apple calls a new framework on how to conduct research, is truly groundbreaking. Forget the gold Apple watch and all the other luxury high end products that they have introduced today. The most important thing they announced today was the research kit, which truly unleashes the power of mobile computing to tackle some of the intractable health issues humanity deals with. 

There are many concerns floating around on popular media about Apple, including the use of rare materials in their phones, which have horrendous environmental and social costs however for the first time in a long time the return on investment in terms of the potential to transform medical research might just be justifiable. 

The inbuilt sensors that are part of every Apple phone, are an incredible source of quality data. The first example of this tool in use, that Apple unveiled today with the assistance of some of the major medical research institutions on the planet is the use of the phone in diagnosing Parkinson’s disease. The built in accelerometers which can measure gait, replicating the gait test which is a diagnostic component of Parkinson’s. The current research kit also includes tools to be able to gather data on Cardiovascular disease. 

With growing concerns about data privacy, people all over the world are concerned about what happens to the very personal data that such apps will draw from the user. Apple has committed to make sure that the data will not be visible to Apple- rather directly to researchers who use the research kit. The whole kit will also be open source so that there isn't a boundary in terms of the program and machine customization. There are important lessons to be learned to other companies like Samsung with this investment in basic science research. Truly an example of doing good by doing well by Apple. 

The implications of the Health Research Kit will be tremendous in the years ahead. In an endless cycle of consumer oriented announcements it is really heartening to see Apple take a step in a direction that truly benefits the wellbeing of people around the world. As arguably the most powerful corporation on the planet, this company has the potential to marshall resources like no other institution on this planet. This is an exciting development and the future will tell if the ambitious plans of this company will continue to benefit humanity.  

The Protest

I wish people were also protesting the loss of human life in Syria, Afghanistan, Iraq, Libya, South Sudan, The Congo, our own First Nations etc. However at this time the Israeli- Palestinian conflict seems to be particularly magnetic. The others not. 

I wonder about this. What causes our selective attention, how do media, literacy, attention and time interact to make this happen- such that waves of in-attention are punctuated by brief bouts of outrage? 

I wonder about the terrible scourge of poverty, which without much fanfare kills many thousands every year. I also wonder about how much critical analysis people undertake- as they chant slogans. What thoughts and solution space are they contemplating for their causes, after the protests are over and the placards have been discarded? How do they intend to make things better over the long term? 

I think a lot about how a dear mentor mentioned that peace is not the absence of conflict rather the ability to manage conflict. I think about how much time and energy it takes to truly manage conflict, or the fact that there are lots of ideas out there that could help- that range from political, economic, legal, educational, and humanitarian but very few people with capacity to implement and operationalize these ideas into action over years of gruelling work. Lots of hot air seems freely available not enough action that makes a long term difference. 

I also think about the futility of posting this on facebook, or twitter. Sometimes I despair with this state of affairs. None of the solutions seem as quick as a protest, all of them require us to be gardeners - patiently planting, watering, weeding over months if not years, ideas. This viewpoint doesn't seem to be as appealing as a blood quickening, exciting protest that is over in a few hours. 

On reflection perhaps, I don't want anyone to protest for the Congo, or Syria or the many other conflict stricken human populations- I would rather they did something that makes actually makes a difference in the long run. 

The perspective of explorers

Making time for Continuum- it's a helpful story- to remind oneself of.

Overview the Movie

The power of TEDx to hunt down stories worth listening to.

I shouldn't be surprised about the power of TEDx to hunt down stories most worth listening to- I was reminded of this the other day. As I plan for TEDxCalgary 'Wilderness' in the fall- one of the speakers I had in mind was Dr. Gabor Mate- I encountered his work whilst working at the Calgary Young Offender's Center.

As Curator I am constantly scanning, remembering and connecting stories in my head, as soon as I engaged with his work I knew that one day he needed to be a TEDx speaker. He would be a perfect speaker for the Wilderness them I thought about a month ago- I finally sent him an invite last week. As coincidences have it- a good friend of mine- posted this talk on FB Dr. Gabor Mate at TEDx Rio+20

His work connects with a number of other stories that I have wandered into in regards to the Human Condition. I think I might have to add it to the TED talks lineup I share at TEDxCalgary 'Wilderness'.

A country even better!

Good conversations lead to well considered actions. An invitation to participate in a conversation about the decisions that affect this great nation. http://justin.ca/soapbox/ - you can be a part of the conversation- I Rahim, a fellow Citizen am inviting you to join in- no time better then the present.

What I wish every MBA kept in mind...

Wise thoughts. Good to remind myself not to chase things...what is of value, how do I make the best decision in any situation etc. What they teach you at MBA School in INSEAD at least!