Alberta Plans New Royalty Incentives to Spur Oil Production

Alberta Plans New Royalty Incentives to Spur Oil Production

Tsvetana Paraskova

Thu, September 17, 2026 at 1:30 PM GMT+3 2 min read

Canada's oil-producing province of Alberta plans to announce in November a new preferential royalty framework to encourage companies to invest in new oil and gas production, Alberta's Premier Danielle Smith said at an industry event.

As Alberta owns 81% of the mineral rights, the Alberta government, as the resource owner, sets conditions and royalties for resource development.

Alberta's ambition to boost oil production and export more of its crude oil to destinations in Asia to reduce the high dependence on exports to the United States has prompted the provincial government to propose a new 1 million-barrels-per-day oil pipeline to the British Columbia coast. The pipeline is expected to receive federal government approval as a project of national interest.

Alberta's government this summer submitted the so-called West Coast Oil Pipeline project to the federal Major Projects Office to be listed as a project of national interest and announced its intent to partner with Trans Mountain Corporation and Pembina Pipeline to advance project development.

The provincial government expects the project to be listed as a project of national interest by October 1, 2026, and receive all approvals and permits by September 2027.

The new royalty framework would be designed to encourage investments in new oil production, Premier Smith said at the Oil Sands Expo in Fort McMurray on Wednesday.

With the new royalty regime, "I suspect that you're going to see a lot of interest in being able to fill that pipeline," Smith said at the event, as carried by Bloomberg.

"But there is a little more work we need to do," the premier added.

In a further boost to investment plans, the federal government of Canada this week announced a major cut in the investment tax rate, with which Canada's marginal effective tax rate on new business investment will fall from about 13% to 6.4% – the lowest of any major economy in the world.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com

Oilprice Intelligence brings you the signals before they become front-page news. This is the same expert analysis read by veteran traders and political advisors. Get it free, twice a week, and you'll always know why the market is moving before everyone else.

You get the geopolitical intelligence, the hidden inventory data, and the market whispers that move billions - and we'll send you $389 in premium energy intelligence, on us, just for subscribing. Join 400,000+ readers today. Get access immediately by clicking here.