Natural gas royalty

Introduction

Albertans own 81% of the province’s mineral rights and the Alberta government manages those resources on their behalf. The province grants companies the right to develop the resources through its tenure process and, in return, the company must pay the province – that’s called a royalty. As the resource owner, the Alberta government sets terms and conditions for development and encourages the use of new technology for enhanced resource recovery by providing programs or incentives to industry. More information about specific royalty programs, as well as historical royalty data can be found in Royalties.

The Alberta Natural Gas Reference Price is a critical input into the valuation of the Crown's royalty volume. The reference price is a representative market price for natural gas bought and sold within the province, calculated using a simplified netback model.