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Land-use Framework

The Land-use Framework (LUF) developed in 2008 was designed to manage our province's land and natural resources to achieve Alberta’s long-term economic, environmental and social goals. The LUF establishes seven new land-use regions and calls for the development of a regional plan for each. The Lower Athabasca Regional Plan and South Saskatchewan Regional Plan came into effect in 2012 and 2014, respectively.

Regional plans

Alberta Energy provided policy direction for the management of Crown mineral rights in new and expanded parks established through the Lower Athabasca and South Saskatchewan regional plans. Within the new conservation areas and provincial parks and provincial recreation areas:

  • No new metallic and industrial minerals, coal or ammonite tenure will be sold. Existing agreements, or portions, are subject to cancelation.
  • New petroleum and natural gas tenure will be issued, subject to a ‘no surface access’ addendum. Surface access for existing agreements, or portions, is honoured.

This policy direction is described in the following Alberta Energy information letters:

Lower Athabasca

South Saskatchewan

In alignment with the Lower Athabasca Regional Plan and Responsible Actions: A Plan for Alberta’s Oil Sands, the Urban Development Sub-Region (UDSR) was announced in 2013 to release more than 55,000 acres of Crown land for urban expansion in Fort McMurray. As described in Information Letter 2013-27, Fort McMurray Urban Development Sub-Region (UDSR): Policy direction on existing surface and subsurface dispositions within UDSR boundary:

  • No new oil sands agreements will be sold. Existing agreements, or portions, are subject to cancellation. Existing agreements, or portions, were cancelled.
  • No restriction is placed on existing or future disposition of metallic and industrial mineral (MIM) leases, petroleum and natural gas leases or coal leases within the UDSR. The reservation of petroleum and natural gas rights within the Mannville zone continues to apply as outlined in Information Letter 2003-24.

Crown mineral rights cancellation and compensation

When the Minister of Energy makes the determination that any or any further development of Crown minerals is no longer in the public interest, or corrects a misdescription of a subsurface zone, Alberta Energy sends a Notice of Intent to Cancel letter to the designated representative/lessee on record indicating which agreement(s), or portion thereof, are subject to  cancellation.

Compensation is determined under the Mineral Rights Compensation Regulation (MRCR). The compensation payable under the MRCR is calculated as the sum of three types of incurred costs plus interest, making up the MRCR’s four compensation categories:

  1. Land acquisition costs:
    1. For an original lessee (MRCR section 3) – the amounts that have been paid to the Crown as bonus, fees and rental over the lifetime of the agreement and any predecessor agreements.
    2. For a transferee (MRCR section 4) – the third-party acquisition costs (limited to the sum of: pre-transfer bonus, rental, fees, and the exploration and development costs of prior lessees), plus post-transfer rental and fees paid to the Crown by the current lessee.
  2. Development allowance (MRCR section 6) – costs incurred by the current lessee to explore for and/or develop Crown minerals in the location subject to cancellation;
  3. Reclamation allowance (MRCR section 7) – costs incurred by the current lessee to meet reclamation obligations in the location subject to cancellation after the notice of intent to cancel has been issued;
  4. Interest allowance (MRCR section 8) – calculated at the Alberta Treasury Branch prime rate plus 1%, not compounded. It is applied to all applicable amounts for a maximum 10-year period preceding the close-off date (typically the date notice of intent t cancel is issued).

Section 5 of the MRCR describes the compensation payable as a result of the need to correct a misdescribed zone. Specific subsections describe what costs apply depending on the nature of the cancellation: if the lessee of record is an original lessee or a transferee and whether the misdescription requires cancellation of a portion or the full extent of the agreement, and/or a specific or specific zones. All misdescriptions qualify for land acquisition costs, development and interest allowances. Full and partial cancellations may also claim a reclamation allowance.

Lessees who receive a notice of intent to cancel and are claiming a third-party acquisition cost and/or development allowance and/or reclamation allowance are expected to submit a completed MRCR application form in the prescribed format. The application form and associated instructions are provided to the lessee of record when notice of intent to cancel is issued.

In addition to the application form, the lessee of record must submit a Statutory Declaration in hard copy in accordance with section 10 of the MRCR. The statutory declaration provides affirmation that the information in the application is accurate and directly associated with the agreement, or portion of the agreement, that is subject to cancellation.

Completed applications, along with all supporting information, are to be submitted prior to the deadline indicated in the notice to: [email protected].


Connect with Alberta Energy about compensation:

Hours: 8:15 am to 4:30 pm (open Monday to Friday, closed statutory holidays)
Email: [email protected] (or review your agreements through the Electronic Transfer System)

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