The bloom is definitely off Alberta's rose in terms of its position as one of the most attractive jurisdictions in the world for petroleum investment.

This observation is based on a recent Fraser Institute survey of close to 400 managers and executives of oil and gas companies that account for more than one third of total world spending on petroleum exploration, production and development.

Respondents to the survey were asked to compare jurisdictions around the world according to 16 criteria such as regulatory practices, political stability and fiscal regime. Based on the survey results, the Institute was able to rank the relative height of barriers to energy investment in 81 different jurisdictions.

According to survey respondents, the jurisdictions with the highest barriers to energy investment were Bolivia, Ecuador and Venezuela. In Canada, the Northwest Territories were the least energy investment friendly jurisdiction, while Saskatchewan was the most accommodating.

In the United States, the survey respondents felt that Florida and California were the most hostile states to energy investment, while New York and Ohio were the most welcoming.

One of the more interesting findings of the 2008 Global Petroleum Survey was the petroleum companies' sensitivity to higher royalties. Following the introduction of a new system of energy royalties in Alberta, the province's attractiveness as an energy exploration and development destination fell from number 22 out of 54 jurisdictions in the 2007 survey, to number 50 out of 81 jurisdictions in the 2008 survey.

The survey also revealed that energy industry managers and executives are now looking more favorably at production sites in jurisdictions adjacent to Alberta considered less hostile to energy investment. Based on this survey's findings and the recent drop in petroleum and natural gas prices, it appears fairly clear that the new royalty regime in Alberta will exacerbate the energy exploration and development slowdown that has already taken hold in the province.