The energy industry breathed a collective sigh of relief Friday as the Royalty Review Panel recommended no change to oilsands royalties and no increase in rates for conventional oil, natural gas or natural gas liquids.
What did change is how conventional oil and gas drillers will calculate their royalties. Grande Prairie and District Chamber of Commerce CEO Dan Pearcy was in Calgary for the announcement and says it’s a much simpler system.
“I think it will be beneficial to both parties, because one of the things they’re addressing on this is not the current price of a barrel of oil, but it’s about the profitability; so it’s about profit-sharing in that market no matter whether it’s high or low.”
The next 60 days will spent spent figuring out the average drilling cost, which will be used for new wells starting in 2017.