Natural Gas

Hypocrisy of politicians exposed

Since first reported in 2007, the BC government’s program of natural gas royalty credits reduced payments from gas producers by $6 billion. In addition, government awarded those companies another $2+ billion in credits that can be used to reduce future royalty payments.

In the five fiscal years from 2013 to 2017, net royalties after credits taken and accrued amounted to a total of only $12 million. In FY 2006, net royalties received were $2,357 million in 2018 dollars.

Royalties 2006 2018 480

With government charging virtually nothing for the resource, gas producers have steadily increased production. The charted numbers shown here are taken from the province’s Budget and Fiscal Plans.

Production 480

So, comparing 2006 to 2018, the volume of gas production rose 86% but royalties went down 94%.

In 2006, royalties amounted to 28% of the wellhead value of natural gas produced in BC. In 2018, royalties amount to 1/5 of 1% of the gas value.

Payments to government for exploration rights, a revenue stream separate from royalties, peaked at $2,428 million in 2009. They averaged $32 million in the three years 2016 to 2018 and are projected to be $9 million annually in the next three fiscal years.

Politicians demand ordinary citizens pay increasing amounts of carbon tax — supposedly to reduce fossil fuel consumption — while at the same time they dish out billions of dollars in subsidies to ensure gas companies produce more fossil fuels. In addition, the current government may be giving an additional $6 billion to LNG producers.

Categories: Natural Gas

15 replies »

  1. never did like that tax on gas. it just made life more difficult for people trying to work, go on vacation, and get their kids around. The tax breaks the gas and oil companies received made them even richer. It was a great way to keep the poor, poor and the rich even richer.

    Carbon taxes are the way some think people will reduce their “carbon” foot print. All it really does is give the government more money and allows corporations to keep on going. Its time people actually got a grip and figured it out. if they want to deal with the environment, then reduce pollution. reduce what corporations can take out of the ground, what they can put on the earth, etc.

    We have a problem because we are consumers of just everything and that hasn’t done us much good. We wouldn’t have all that smog and junk in the air if the manufacturers weren’t doing what they do. will things change, no. People do need to understand what the previous government did in this province and ensure it stops all around.

    Liked by 1 person

    • “We have a problem because we are consumers of just everything… We wouldn’t have all that smog and junk in the air if the manufacturers weren’t doing what they do.”
      And hereinlies the disconnect. Besides the Royal we, the problem is you. Markets are based on demand. It won’t be produced if you and many others don’t buy it.
      Nevertheless, the article makes good points about the hypocrates in BC.


  2. Good grief.

    The BC carbon tax is supposed to go up every year. The idea is that we drive less.

    At the same time the Fed Govt wants to ram a pipeline expansion through BC so that drivers in other countries can drive more.


    • Clearly the cost of driving is going up but so is the cost of lighting and heating our homes. Additionally, the extra carbon tax paid by manufacturers, distributors and retailers will be passed along in the form of higher prices.

      At our house, the carbon tax is about $300 a year for home heating and about $250 for automobile transportation. With the tax rate rising 67% by 2021, that will result in us being taxed more than $350 a year extra.

      When it was introduced in BC, we were promised carbon tax would be revenue neutral. It is, more or less. Government takes in about $2 billion in carbon tax and it reduced taxes on natural gas producers by that amount or more.


  3. For some reason I’m hearing “breach of fiduciary duty” .. and “malfeasance” to say nothing of outright corruption.

    And the political creatures who created the above mess are still not in jail – why is that?


  4. The hard thing to do is to give up your private car, or at least your second car, or the truck that you don’t really need, and then switch to using public transport or self-propulsion. I am retired and can do this more easily than when both my wife and I worked. More and more of us are in the retired category and it is ‘us’, the boomers, that created the mess, so let’s commit ourselves to leading the way out of the mess.


  5. Hello Norm:
    The CBC report claims that Vanadium will save the Oil Sands Project.
    I really think that Shell Oil is playing a shell game. They want to extract every penny from greedy/gullible politicians like Trudeau and Notley. If they were interested in cleaning up the planet they would have
    already been producing vanadium batteries.
    Kinder Morgan wants its shareholder to take the risk, taxpayers pay for all oil spill clean up, the CEO wants a billion dollar retirement package and then Kindermorgan will declare bankruptcy. They will then sue Canada for lack of contract fulfillment. That is the Ultimate Trump-like business plan.
    The new numbered company rising from the Snake-Oil ashes, will then ask the federal for tax incentives to “explore” cleaner technology that will employ billions of people … just in time for the next election.
    Isn’t Kindermorgan a Texas based oil company?
    Why isn’t Trudeau mentioning the failure of the Oil-East Project through Quebec?


  6. BC is North America’s largest exporter of coal, according to the Vancouver Sun today. The BC Govt apparently wants to export LNG from BC. The Fed Govt wants to ship diluted bitumen through BC and out Vancouver Harbour.

    Remind me why in BC we are paying the rising carbon tax?

    Liked by 1 person

  7. This passage from “Homo Deus”, Yuval Noah Harari’s latest, brings home Hugh’s point.

    “Humankind finds itself locked into a double race. On the one hand, we feel compelled to speed up the pace of scientific progress and economic growth. A billion Chinese and a billion Indians want to live like middle-class Americans, and they see no reason why they should put their dreams on hold when the Americans are unwilling to give up their SUVs and shopping malls. On the other hand, we must stay at least one step ahead of ecological Armageddon. Managing this double race becomes more difficult by the year, because every stride that brings the Delhi slum-dwellers closer to the American Dream also brings the planet closer to the brink.”

    As long as we allow politicians and their corporate masters to pay lip service to the steps necessary to stay ahead in one race, while promoting and profiting from the other, there isn’t much doubt about the eventual “winner”.

    As Pogo said, “We have met the enemy and he is us.”

    Liked by 1 person

  8. Gosh.

    Isn’t that net difference in royalties lost per year about the same as we, the people, also pay for MSP?

    Is it any wonder we can’t have nice things like properly funded healthcare, parks and public schools?



  9. We need a political party and leadership with enough balls to stay the course on reducing Canada’s carbon emissions, reducing fossil fuel exports, and demand from the federal leaders and provinces nothing short of an unwavering commitment to take serious action on saving the planet- today- not a promise to make discernible progress by 2050. Someone needs to expose the extent of the irreparable harm our politicians are making all of us Canadian complicant in.


  10. The “Story” narrative accompanying this CBC video from 1953 says, “To transport it to markets where it’s needed, the Kinder Morgan company has engineered and built the 718-mile-long (1,150 km) Trans Mountain Pipeline.” It also includes some pumping of Kinder Morgan tires re how carefully they installed the original pipeline, and references a world hungry for our oil.

    Really? Kinder Morgan wasn’t founded until 1997.

    The video and accompanying narrative has been making the Internet rounds lately.

    Methinks there’s some sneaky PR work afoot to rewrite history.


    • Enron/Kinder Morgan went bankrupt, was proven to be valuation manipulators and terms like fraud were used to classify the board’s actions. Kinder Morgan is only the latest incarnation of this bunch of serial liars.

      The fact the federal govt. is entertaining thoughts of buying this pipeline, only further assaults Canadian confederation in it’s current form. Notice Quebec has realized the possible future ramifications of the Liberal’s desire to build out KM? Meanwhile the prairie Premiers (Larry, Curly & Moe) are all threatening BC, their export markets for almost all exportable items is through BC, this escalation will not do anything positive for the situation except further entrench the BC opposition to this pipe. Most sane folks will just see 2 idiots arguing, you should never argue with idiots, they usually beat you with experience. The three stooges are trying to draw Horgan into their questionable fight, of Trudeau’s creation.

      Trudeau 2.0, the most divisive leader in Canada since confederation, sunny ways for separatist ways!


Leave a reply but be on topic and civil.

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s