Alberta’s royalties unchanged after review

CALGARY - Alberta's royalty review panel has recommended the rates for oilsands projects remain the same, but that the rules around how costs are accounted for be improved.

CALGARY – Alberta’s royalty review panel has recommended the rates for oilsands projects remain the same, but that the rules around how costs are accounted for be improved.

It also says the regime for conventional oil and natural gas wells should be tweaked so that royalty rates better take into account the costs of drilling, instead of just production levels and commodity prices.

A flat five per cent royalty rate will be applied on wells until their revenues equal a cost allowance, after which rates will go up.

The province will determine in the coming months how those cost allowance numbers will be crunched.

The panel, led by ATB Financial boss Dave Mowat, also says the system should be agnostic about what type of resource is coming out of a well.

Today’s system applies different rates to oil, natural gas and natural gas liquids, which makes some companies reluctant to explore if they don’t know what resource their drill bit will encounter.

The new system will take effect in 2017.

Wells drilled prior to that will be subject to the existing rules for 10 years.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Alberta's chief medical officer of health Dr. Deena Hinshaw said province's test positivity rate for COVID-19 is steadily declining. (Photo by Chris Schwarz/Government of Alberta)
One new COVID-19 death in Red Deer, 257 additional cases province-wide

Red Deer sits at 459 active cases of the virus

Alberta Health Services Logo
AHS upgrading online immunization booking tool

Alberta Health Services’ online booking tool for COVID-19 immunizations will be temporarily… Continue reading

Eric Rajah and Brian Leavitt were awarded with Meritorious Service Medals by the Governor General for co-founding the Lacombe-based charity A Better World. The agency’s goal is to reduce poverty and boost education in Africa and Afghanistan. (Contributed photo)
Co-founders of Lacombe-based charity receive one of Canada’s highest honours

Eric Rajah, Brian Leavitt of A Better World are honoured by the Governor General

Nice Horse, a band with Central Alberta connections, won three times at the 2021 Alberta Country Music Awards. (contributed photo by Heather Pollock).
Nice Horse wins three times at 2021 Alberta Country Music Awards

Calgary-based band has some central Alberta connections

(BLACK PRESS file image)
AHS warns parents to keep button batteries away from small children

Some kids swallowed the small cells and were hospitalized

Red Deer dogs Bunsen and Beaker helped save a missing pet recently. The two dogs have more than 80,000 followers on Twitter. (Contributed photo)
WATCH: Red Deer science dogs help save lost pet

Red Deer science-communicating dogs Bunsen and Beaker helped rescue a missing pet… Continue reading

A sign board in Toronto shows the closing number for the TSX on Thursday October 29, 2020. THE CANADIAN PRESS/Frank Gunn
North American stock markets quieter after strong start to March as all eyes on bonds

North American stock markets quieter after strong start to March as all eyes on bonds

Shipping containers are seen at the Fairview Cove Container Terminal in Halifax on Friday, Aug. 25, 2017. THE CANADIAN PRESS/Andrew Vaughan
After worst year on record, Canadian economy enters 2021 with double digit growth

After worst year on record, Canadian economy enters 2021 with double digit growth

Good Earth Cafes unveils strategy to move in when Starbucks closes Canadian shops

Good Earth Cafes unveils strategy to move in when Starbucks closes Canadian shops

‘Door is open:’ Ottawa ready to help pork producers affected by Olymel shutdown

‘Door is open:’ Ottawa ready to help pork producers affected by Olymel shutdown

Environment and Climate Change Minister Jonathan Wilkinson responds to a question in the House of Commons on Nov. 19, 2020 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Canada can’t ‘power past coal’ and keep exporting it, environment group says

Canada can’t ‘power past coal’ and keep exporting it, environment group says

A nurse assistant prepares a dose of the Oxford-AstraZeneca vaccine for COVID-19 during a priority vaccination program for health workers at a community medical center in Sao Paulo, Brazil, Wednesday, Feb. 3, 2021. THE CANADIAN PRESS/AP-Andre Penner
Split over AstraZeneca vaccine sparks questions on who will get it as variants spread

OTTAWA — Canada’s chief public health officer says new COVID-19 cases are… Continue reading

Banana bread (file photo)
Calgary not-for-profit going bananas trying to off-load pallets of fruit

CALGARY — It’s been bananas at a Calgary not-for-profit as it tries… Continue reading

Image courtesy Creative Outlet
Edmonton chiropractor admits to sexually assaulting six female patients in 1980s

EDMONTON — A chiropractor has admitted to sexually touching six of his… Continue reading

Most Read