Nalcor, the provincial government’s energy corporation, paid $142,332 in royalties on North Amethyst in 2010. The company has paid $317,399 in 2011 on the same project up to the end of June.
That’s information provided to SRBP by Nalcor Energy in an e-mail. The royalty figures apply only to the White Rose expansion. There’s more information on Nalcor and royalties in a post from last week.
According to Nalcor vice president Jim Keating, “Nalcor forecasts that total royalties paid to the province will exceed $2.06 billion dollars over the full field life of the Hebron, White Rose Expansion and Hibernia Southern Extension Projects.”
Nalcor is liable for provincial royalties on two of the three projects and may be liable for royalties from Hebron. According to Keating:
The Hebron contract does provide the Province with the ability to apply a 0% royalty rate to its Crown Corporation should the Province choose to do so. These provisions were included to ensure the current and any future Governments were not limited in their policy decisions. While the Province may in the future choose otherwise, it has decided to hold Nalcor Energy in the same shoes as other interest holders and is therefore subject to royalty payments under the same terms as the other owners.
Nalcor holds a 5% interest in the White Rose expansion, a 4.9% interest in Hebron and a 10% interest in the Hibernia southern extensions.
Keating did not provide any details on how the company arrived at the projected royalty total. SRBP asked for more information - total quantity of oil, oil price assumptions etc - after the e-mail arrived on Friday but did not receive a reply in time for this post. When the reply arrives, your humble e-scribbler will pass it on.
- srbp -
