Updates to British Columbia’s royalty program will increase the competitiveness of the province’s natural gas sector and support the long-term prospects of a liquefied natural gas industry.
Effective April 1, 2014, industry operating in British Columbia will benefit from the expansion of the Deep Well Royalty Credit Program. By providing credits for deep well drilling, companies will increase their investments in these types of wells and create jobs on the ground.
The Province’s Ultra-marginal Royalty Program also will be updated. This program reduces the royalties paid by industry from wells that have a low rate of production.
The revenue generated from these improvements are expected to raise $2.9 million over the next three years.
Operators will not be eligible for both programs concurrently.
Expanding or introducing new royalty programs is necessary to make sure the natural gas sector remains competitive, and it is part of the Government of British Columbia’s 10-year Natural Gas Strategy.