The December 11 sale of petroleum and natural gas rights realized one of the lowest amounts of any monthly tender since 1996.
Calendar year 2019 yielded below $15 million, the smallest public return from sales of rights in any of the last 23 years.
Gas producers once annually contributed billions of dollars to the provincial treasury by royalties and payments for rights. These are no longer material sources of government revenue.
Royalties have been largely eliminated by more than $10 billion in payment reduction credits taken and accrued by gas producers. Depending on who offers the justification, credits are either intended to increase activity in gas fields of northeast BC, or to make them more profitable for private companies.
Were timber companies offered similar levels of cost relief as gas producers, the province would not have thousands of forestry workers hungry for employment.
Politicians seem to believe that non-renewable resource companies are more deserving of financial support than ones harvesting renewable assets.
Payments for gas exploration and production rights have almost disappeared because large tracts of provincial land are in private hands through administrative assignment, instead of by public tender. This recap drawn from monthly sales reports provides the evidence:
Notice the real change occurred about the time that Gwyn Morgan was an influential advisor to incoming Premier Christy Clark. John Horgan’s administration continues the former government’s energy policies and not a single Liberal MLA objects.
Of course, reducing tenders for rights on public properties has resulted in major revenue declines.