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Home/Taxes and tax credits/Natural resource taxes/Oil and gas royalties and tax/Reduce your royalties

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Reduce your oil and natural gas royalties

Last updated on August 23, 2024

If you produce oil or natural gas in B.C., you may be able to reduce the amount of royalties you pay. Some adjustments are automatic and others are not. Learn how allowances, exemptions, credits, deductions and lower royalty rates may apply to you.

Allowances

  • Producer cost of service (PCOS)
  • Gas cost allowance (GCA)

Exemptions

  • Discovery wells
  • Natural gas or natural gas by-products used for oil or natural gas production, drilling or injection

Credits and deductions

  • Natural gas deep well deduction
  • Natural gas deep well re-entry deduction
  • Infrastructure credits (such as road credits)
  • Summer drilling program

Lower royalty rates

  • Low productivity well royalty reduction
  • Marginal well royalty reduction
  • Ultramarginal well royalty reduction
  • Net profit royalty program

Contact information

Find out who to contact for your questions about oil and natural gas in B.C. 

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