DAVID EBNER

Globe and Mail Update

January 29, 2008 at 4:42 PM EST

CALGARY — Alberta will unveil a new royalty framework Tuesday afternoon after facing many criticisms from industry over decisions to hike rates across that board, increases that led to more than a $1-billion in spending cuts.

Energy Minister Mel Knight at 3:15 p.m. MT will announce the details in Calgary and also announce details of new deals with Syncrude Canada Ltd. and Suncor Energy Inc., the two oldest oil sands miners that had individual deals with the province.

Alberta is responding to what it has called “unintentional consequences.” In a Jan. 9 letter to the Canadian Association of Petroleum Producers from Mr. Knight, reported by The Globe and Mail, the government said it would deal with the issues this month.

Last October, the government increased royalties across the board, on conventional oil and natural gas and in the oil sands, hoping to increase energy revenues by 20 per cent or $1.4-billion in 2010. Roughly the same amount has already been lost in lower capital spending by industry in the field and on the sale of new exploration rights.