EDMONTON – The global demand for helium is on the rise in part because of its use in medical imagine, electronics and space exploration. And the industry interest in exploring Alberta’s helium potential is growing.
In the hopes of diversifying Alberta’s economy and creating jobs, the province set a new rate – of 4.25 per cent – to promote investment.
Several companies expressed interest in investing in Alberta’s helium potential, but the lack of a royalty rate has been a disincentive.
“Removing this barrier unlocks the potential to develop helium deposits in southeastern Alberta and sets us up to take advantage of the close proximity to the United States, the world’s largest helium consumer,” said Sonya Savage, Minister of Energy in a statement today.
“Economic diversification is an essential part of the province’s recovery efforts and sets a course towards future prosperity.”
This effective royalty rate is set for an initial period of five years. At that time, the rate will be reviewed to ensure it remains competitive and allows for any necessary adjustments.
The new royalty rate and structure for helium comes into effect retroactive to April 1. The helium royalty rate is being established through amendments to two regulations: Natural Gas Royalty Regulation, 2009; and Natural Gas Royalty Regulation, 2017. Canada has the fifth largest helium reserves in the world. Saskatchewan is currently the only commercial helium producer in Canada.