About the Oil and Gas Commission Levy

On May 19, 1998, the Province of British Columbia and the Canadian Association of Petroleum Producers announced an agreement to stimulate oil and gas exploration and development in B.C.

As part of this agreement, the British Columbia Oil and Gas Commission (OGC) was created to act as a single-window regulatory and permitting agency for the upstream oil and gas industry and pipelines.

The OGC is funded by the industry through a range of fees and a levy on production. Developed in consultation with the Canadian Association of Petroleum Producers, the Oil and Gas Commission Levy came into effect October 23, 1998 with the proclamation of the Oil and Gas Commission Act. The new Levy replaced the Natural Gas Price Act Levy and extended the levy base to include oil production.

As of April 1, 2006, under an amendment to the Oil and Gas Commission Act, a tax on oil and gas production took effect for the new Orphan Site Reclamation Fund ("Orphan Fund").

The purpose of the Orphan Fund is:

1. to pay the costs of abandonment and restoration of orphan wells, test holes, production facilities and pipelines
2. to pay the costs incurred in pursuing reimbursement for the costs outlined above, from the person responsible for paying those costs
3. to pay any other costs directly related to the operations of the OGC in respect of the fund
4. to pay compensation to land owners on whose land the OGC expends money on an orphan site if, on application by a land owner, the OGC is satisfied that the operator has failed to make payments to the land owner under a surface lease, and subject to the maximums, conditions and limitations prescribed by regulation

The Ministry of Small Business and Revenue invoices producers on a monthly basis for petroleum and marketable gas levies and the Orphan Site Reclamation Fund Tax.