Process overview for royalty taxpayers and facility operators

This information will help you understand the process for oil and natural gas royalty taxpayers and facility operators.

On this page

• Getting started
• Running your business
• Important dates

Getting started

1. Obtain your right to explore for oil and gas

Before you can explore for oil and natural gas, you need to have oil and natural gas rights from the Ministry of Energy, Mines and Low Carbon Innovation through a provincial tenure agreement.

2. Obtain approval to drill a well or build a facility

Once you have the provincial tenure agreement, you must obtain approval from the British Columbia Energy Regulator (BCER) to carry out work.

You must register with the BCER if you are an oil or natural gas producer, or if you operate oil or natural gas wells or facilities in B.C.

Each oil and natural gas activity, such as drilling a well or building a facility, must be approved by the BCER.

To meet regulatory and conditional data submission requirements, submit your operational data directly through the BCER’s eSubmission online portal.

Note: Oil and natural gas producers pay a production levy that the Ministry of Finance invoices and collects.

3. Obtain your Business Associate ID (BAID) with Petrinex

Most reporting will be made through Petrinex, an online database.

You will need to register for access to the Petrinex system.

Training modules are available on the Petrinex website under Learning Centre.

4. Get connected with the Ministry of Finance through Petrinex

Once you have access to Petrinex, the information you provide in Petrinex is shared with the Ministry of Finance, including:

• Production and allocation information
• Valuation information for all products except gas
• Producer cost of service applications
• Gas cost allowance applications

The Ministry of Finance uses the information you submit to Petrinex to set you up as a royalty taxpayer. Once you are set up, the ministry will assign you a royalty analyst who is your main point of contact with us.

Running your business

When you’re producing, you must report information in Petrinex on a monthly basis. Royalty taxpayers must also report natural gas sales and cost of service information to the Ministry of Energy, Mines and Low Carbon Innovation. We use the information you submit to Petrinex and the Ministry of Energy, Mines and Low Carbon Innovation to calculate and assess your royalties.

It is important to submit your information by the reporting deadline, which differs by product and activity, to avoid a penalty or deemed royalty.

Once you are assessed, your invoice will be available in Petrinex and your eTaxBC account. There are different invoices depending on the type of account(s) you have. Be sure to pay your invoices on time to avoid interest charges.

Important dates

For each calendar month where you produce any quantity of oil, natural gas, gas by-products or water from a well, you need to report information and pay invoices on specific dates over a three-month period. The month where you produce is referred to as a production month, while the number of months after the production month is indicated by +X. For example, production month +2 means the production month plus 2 months.

The following table outlines the important dates in the three-month period, which may fluctuate if the date falls on a weekend or statutory holiday. Review the Petrinex hours and reporting calendars to avoid penalties related to missed deadlines.