DOB Energy – Exclusive
B.C. minister’s letter to stakeholders
outlining royalty shift ‘step
in the right direction’
By Cathryn Atkinson April 21, 2026
VICTORIA, BC - In a letter sent to energy and industry stakeholders on April 9, B.C.’s minister of energy and climate solutions Adrian Dix clarified the government’s position on upcoming changes to the province’s royalty framework.
After stakeholders recently sent submissions on the framework, Dix wrote that he appreciated “the breadth and depth of submissions received from producers and industry associations.”
He added that B.C. “will not be advancing the Transition-Plus or Enhanced Return royalty curve scenarios further.”
The B.C. government describes the curves as “price-sensitive curves for different commodities. If the price is low, the royalty is low; if the price is high, the royalty rate increases.”
Dix wrote further: “We acknowledge the concerns raised about the magnitude of change associated with those scenarios and the uncertainty they could introduce at this stage.”
“Any further scenarios will consider your feedback as we work to align with the objectives of the New Royalty Framework.”
The feedback received had reflected “both near-term investment considerations and long-term strategic decisions facing the sector,” added Dix, who was contacted for additional comment but did not respond before publication.
In the letter, Dix said the key themes in the submissions included support for a modernized revenue-minus-cost royalty system; the importance of stability, predictability, and confidence in the fiscal framework to support long-term investment decisions; concerns regarding competitiveness with other jurisdictions; the need for royalty design and analysis to reflect competitiveness, portfolio-based capital allocation and real-world commercial behaviour; and the close interdependence between upstream natural gas development and LNG investment, including the need for reliable B.C. gas supply to underpin existing and future LNG projects.
Dix said commitment to the growth of LNG was a cornerstone of B.C.’s strategy and that “a strong, investable upstream sector is essential to realizing this opportunity.”
He ended the letter by stating that the province was committed to transparency, to undertaking further technical analysis, and continuing dialogue on commercial realities and “how best to ensure the royalty framework meets its objectives in practice.”
‘Avoid a flight of capital’
In an exclusive interview with DOB Energy, Gary Mar, president and chief executive of the Canada West Foundation, said the letter was “a step in the right direction.”
Mar wrote an April 10 op-ed in The National Post on how B.C.’s royalty review poses a risk for investment, “to bolster the argument” presented by industry.
In a conversation earlier this month about forestry with B.C.’s Minister of Forests Ravi Parmar, the former Alberta politician said he pushed the topic to energy and royalties.
“I told him, ‘There’s actually a sort of a probative lesson from [former Alberta premier] Ed Stelmach’s attempt to change the royalty revenue scheme back in [2007], which resulted in a flight of capital in the province of Alberta,’” Mar said.
“And I shared with him that story and I think that they're listening.
“I mean, if you’ve got a $10 billion-plus deficit, this ain’t the way that you fix it. You make it worse, was the point that I made to the minister.”
He said it is too early to tell what the impact will be of changes to B.C.’s royalties program, due to begin on Jan. 1, 2027.
“I think this letter is a good start for a more detailed conversation between industry and the government of British Columbia,” Mar said.
“In my mind, Canada should be the best place to get [natural gas] from, but capital will not be attracted to it without public policy durability…. There will be a flight of capital without durable public policy.”
With energy security being brought to the front of the queue in terms of international priorities, Mar said current geopolitics has put Canada back on the radar.
While he does not believe billion-dollar capital investments in LNG will as yet come from the actions of the past few months, including the Iran war, international investors are now looking at what could happen in the next 30 years.
“If you believe that the Strait of Hormuz is always going to be contested and that there will be issues there, then that’s the reason why you would look to Canada as being a stable democracy with the ability to deliver and [that upholds] the rule of law,” Mar said.
“I think people will be looking at capital investment in the right circumstances here in Canada.
“If you can displace oil that comes from Iran or gas that comes from the region with Canadian oil or gas, you’re not increasing the amount of oil that’s used in the world, because the demand has got a certain curve to it, but you are reducing the revenues that go to places like Iran that allow them to foment war and terrorism.”