February 6, 2008 / 12:24 AM / in 10 years

Alberta goes to polls amid oil boom strain

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.

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

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.

The premier faces competition from the centrist Liberal Party, led by Kevin Taft, and the left-wing New Democrats, led by Brian Mason.

Neither gained much political traction during the heated royalty debate, even as opinion polls showed surprisingly large public support for charging the industry more economic rent.

Another key issue is climate change, as Alberta is Canada’s largest emitter of greenhouse gases amid the rush to develop its vast oil sands.

Last week, Stelmach announced a plan to cut emissions by 14 percent within 42 years. But under the strategy, which relies heavily on development of carbon capture and storage, emissions would rise for at least another decade.

At dissolution, Stelmach’s Progressive Conservatives had 60 seats in the 83-seat provincial legislature. The Liberals had 16 seats, the NDP had four, and the fledgling right-wing Wildrose Alliance had a single seat. There was one seat held by an independent and one was vacant.

($1=$0.99 Canadian)

Reporting by Jeffrey Jones; editing by Rob Wilson

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