Royalty bonanza for Canadian provinces

Gary Park

Canada’s petroleum-producing provinces have struck it rich.

By March 31, when fiscal 2005-06 ends, they are counting on oil and gas royalties of C$16.1 billion, easily eclipsing previous highs of C$11.36 billion in 2004-05 and C$9.11 billion in 2003-04.

As usual, Alberta leads the pack, counting on a windfall of C$11.5 billion (plus another C$2 billion from land sales), beating the 2004-05 record by close to C$3 billion.

Natural gas is expected to contribute a total of C$9.05 billion compared with C$6.44 billion the previous year.

Conventional oil revenues are on track for C$1.3 billion, up 8.7 percent in 2004-05, with oil sands royalties making their mark, surging to C$1.07 billion from C$718 million in 2004-05 and C$197 million in 2003-04.

British Columbia forecasts a gain of C$1 billion to C$2.57 billion and Saskatchewan is budgeting for an increase to C$1.47 billion from C$1.12 billion.

Newfoundland, with three offshore fields now pumping oil, should reach C$455 million, beating the previous year’s C$124 million, while Nova Scotia’s Sable gas field is forecast to return C$119 million, topping the previous year by C$95 million.