Alberta goes to polls amid oil boom strain

Mon Feb 4, 2008 6:31pm EST
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CALGARY, Alberta (Reuters) - Voters in Alberta, Canada's main oil-producing province, will go to the polls on March 3 in an election to judge Premier Ed Stelmach's plans to cope with strains caused by a years-long economic boom.

Stelmach called the vote on Monday, ending weeks of speculation and multimillion-dollar spending announcements by his Progressive Conservative government.

Polls show the rookie premier, a low-key farmer and long-time politician from the central Alberta region of Fort Saskatchewan-Vegreville, with a comfortable lead among voters, but with weaker support in the major cities, Calgary and Edmonton. His party has been in power in Alberta since 1971.

Since taking over from former Premier Ralph Klein in late 2006, Stelmach, 56, has been faced with dealing with the impact of an unprecedented energy-driven economic expansion.

That includes shortages of affordable housing and hospital beds, strained infrastructure like schools and roads and a belief by many of the province's 3.3 million people that good times brought about by high oil prices have passed them by.

Last week, Stelmach proposed a C$120 billion ($121 billion), 20-year capital plan to build up infrastructure, and on Monday tempted voters by proposing an end to health-care premiums.

His most controversial move was to launch a review of Alberta's oil and gas royalty regime. His independent panel concluded that the energy industry was getting too sweet a deal and that royalties should be hiked by C$2 billion annually.

Oil companies railed against changes to the fiscal regime and threatened to spend their cash elsewhere, arguing that Alberta's operating costs are already higher than those in other parts of the world.

In October, Stelmach said royalties will increase, but by a lesser extent than proposed by the review panel.   Continued...

<p>Alberta Premier Ed Stelmach speaks to the media as he announces an election in Alberta, February 4, 2008. REUTERS/Dan Riedlhuber</p>