The Athabasca Tar Sands and its rapid development is draining labor and funding from conventional oil and natural gas markets.

High oil prices have increased investments in oil and tar sands and Premier Ed Stelmach's new royalties could soon make Alberta one of the least attractive places to develop conventional oil and natural gas in North America.

Alberta has put most resources into the development of oil sands and as a result, Alberta's gas production fell by 7 percent from January 2006 to March 2008 and the decline is expected to continue with Stelmach's recent budget earmarking $100 million to spur technology development and diversification.