Natural gas royalties in BC

BLUEFUELENERGY.COM: Following up on our August 6 post about BC’s GHG emission baseline—and the role that Blue Fuel/DME produced with renewables can play in helping the province comply with its Greenhouse Gas Reductions Target Act–on that very day Toronto's Globe and Mail featured an article by Dave Ebner titled “BC slashes natural gas royalties”.

As Mr. Ebner points out, all wells drilled in BC from September through the end of June 20 will be charged a nominal royalty of 2% for the first year of production, a move designed to spark drilling in the province’s northeast. The BC Government is aggressively seeking to spark drilling for natural gas in the northeastern part of the province, where the huge Montney and Horn River gas plays are located. The government’s reliance upon these gas plays to help it deal with its rising deficit is very real—as will be the carbon dioxide emissions that these plays will generate when production gets cranked up. The natural gas processing industry is already a huge generator of carbon dioxide emissions in BC, which means that both this industry and the BC government have a major problem on their hands.

The only solution proposed thus far is the passive sequestration of this carbon dioxide into subsurface geological formations, a measure that is experimental, alarmingly expensive—and wasteful of captured carbon dioxide. It is Blue Fuel Energy’s view that active sequestration of this valuable resource by using it as a feedstock for Blue Fuel/DME is the answer. Natural gas processors can relieve themselves of their carbon burden and the government can rightfully claim that BC is setting an example to the rest of the world when it comes to greenhouse gas emissions.