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Oil and Gas Processing Investment Incentive
SK, Canada
Tax credit for oil and gas production in Saskatchewan
grant_single_labels|summary
grant_single|eligibleFinancing
- grant_single|fromMinToMax
- grant_single|projectCostPercent
grant_single|deadlines
- grant_single|openingDateJuly 8, 2019
- grant_single|closingDateMarch 31, 2029
grant_single|financingType
Tax Credits
grant_single|eligibleIndustries
- Mining, quarrying, and oil and gas extraction
- Utilities
- Manufacturing
grant_single|grantors
- Government of Saskatchewan
grant_single|status
grant_card_status|open
grant_single_labels|preview
Get a transferable production tax credit of 15% to offset the costs of qualified greenfield or brownfield value-added projects.
grant_single_labels|terms_and_conditions
The Oil and Gas Processing Investment Incentive (OGPII) offers financial support through transferable royalty and tax credits to enhance value-added projects in Saskatchewan's energy sector. These credits provide flexible financial benefits for qualified projects.
- The incentive provides transferable Crown royalty and freehold production tax credits for qualifying projects, calculated as 15% of eligible program costs.
- Credits are capped at CAD $75 million for oil, gas, helium, and lithium projects, and at CAD $70 million for chemical fertilizer projects, on a project-specific basis.
- Credits can be claimed progressively: 20% in the first calendar year, 30% in the second calendar year, and 50% in the third calendar year after project commencement.
- These credits are fully transferable, allowing entities that do not produce or pay royalties to transfer the credits to eligible parties within the sector.
- The program encourages collaboration by allowing costs to be incurred by a company other than the principal applicant.
- OGPII credits can be utilized in conjunction with other grants or incentive programs available in Saskatchewan.
grant_single_labels|projects
This incentive supports value-added projects in Saskatchewan's oil, gas, helium, and lithium sectors, as well as chemical fertilizer facilities, to boost economic development and enhance processing capacity. Projects may involve greenfield or brownfield developments and focus on processing, transforming, or upgrading industry products.
- Refineries/upgrading facilities, including partial upgraders, asphalt production, and sulphur removal units.
- Petrochemical facilities producing methanol, ammonia, polypropylene, olefins, and ethylene.
- Associated gas commercialization projects, such as processing facilities and waste-gas-to-power projects.
- Regional gas gathering projects and multi-phase projects considered under a single application.
- Helium processing or liquefaction facilities.
- Carbon capture, utilization, and storage projects for enhanced oil recovery.
- Commercialization of oil and gas production byproducts and waste products, including lithium extraction from produced oilfield water.
- Chemical fertilizer facilities.
- Lithium processing facilities.
grant_single|admissibleProjectsExample
$ 750,000
Establishment of a lithium extraction facility from oilfield water
$ 750,000
Development of a regional gas gathering project to optimize resource use
$ 750,000
Development of a methanol production facility to utilize Saskatchewan's natural gas resources
$ 750,000
Construction of an ammonia production facility to benefit the local fertilizer industry
$ 750,000
Establishment of a carbon capture facility to enhance oil recovery
$ 750,000
Construction of a helium liquefaction facility to commercialize helium gas
grant_single_labels|admissibility
Eligibility for the Oil and Gas Processing Investment Incentive (OGPII) grant requires meeting specific criteria related to activities, project impact, and investment level.
- All activities must add or create value by processing, transforming, and/or upgrading upstream oil, gas, helium, and lithium industry products, commercializing these up- and waste products, or enhancing value-added chemical fertilizer production.
- The project must lead to a significant increase in processing capacity within Saskatchewan's oil, gas, helium, lithium, or chemical fertilizer industries.
- The eligible project must involve a minimum investment of CAD$10 million in applicable costs.
grant_eligibility_criteria|who_can_apply
Eligible applicants for the OGPII program include value-added projects across all segments of Saskatchewan's oil, gas, helium, and lithium sectors, as well as chemical fertilizer facilities. Projects must involve new (greenfield) facilities or expansions (brownfield) of existing facilities that significantly increase processing capacity in these industries.
grant_eligibility_criteria|eligible_expenses
The OGPII grant supports developments in Saskatchewan's oil, gas, helium, and lithium sectors to enhance value addition, sustainability, and commercialization of byproducts. Eligible projects are encouraged to advance processing capacity and innovation within these industries.
- Refinery and upgrading facilities such as partial upgraders and asphalt production.
- Petrochemical facilities producing chemicals such as methanol and polypropylene.
- Projects focusing on the commercialization of waste gas by converting it to power.
- Development of regional gas gathering projects and multiphase ventures.
- Helium processing and liquefaction facilities to enhance this sector.
- Carbon capture, utilization, and storage for oil recovery enhancement.
- Extraction of lithium from produced oilfield water as a byproduct.
- Establishment of chemical fertilizer production facilities.
- Projects that expand existing facilities (brownfield) or create new ones (greenfield).
grant_eligibility_criteria|zone
This incentive is administered by the Government of Saskatchewan, which generally implies a focus on projects within this province. Projects likely need to be based or have a significant impact in the Saskatchewan region.
- Projects located in the province of Saskatchewan.
grant_single_labels|criteria
Yes, there are evaluation and selection criteria for the Oil and Gas Processing Investment Incentive (OGPII). Applicants must meet specific eligibility requirements and be assessed by the Ministry of Energy and Resources to receive conditional approval and subsequently qualify for royalty credits.
- The eligible activity must add or create value by processing, transforming, and/or upgrading upstream oil, gas, helium, and lithium industry products.
- Eligible projects can include new (greenfield) facilities, expansions (brownfield) of existing facilities, and all enabling infrastructure required to bring the project into operation.
- The project must result in a significant increase in processing capacity in Saskatchewan's oil, gas, helium, lithium, or chemical fertilizer industry as determined by the minister.
- The project must involve a minimum investment of CAD$10 million in eligible costs.
- The project must not have become operational before the eligible project application is submitted.
grant_single_labels|register
- Step 1: Obtain Application Documents
- Download the "OGPII Program Overview and Application Instructions" to understand the details of the application process.
- Obtain the "OGPII Application Form" to begin your application preparation.
- Step 2: Prepare Application
- Complete the OGPII Application Form with detailed and accurate information about the proposed project.
- Ensure all project-specific information and eligible costs are accounted for in the application form.
- Step 3: Submit Application
- Submit the completed OGPII Application Form to the Ministry of Energy and Resources via email at ogpii@gov.sk.ca.
- Ensure the submission is done during the application acceptance period, which is from 8:00 a.m. (CST) on July 8, 2019, to March 31, 2029.
- Step 4: Follow Up
- If there are any questions or further clarification needed, contact the Ministry of Energy and Resources at ogpii@gov.sk.ca.
grant_single_labels|otherInfo
The OGPII program involves detailed regulatory procedures and specific requirements that must be met by applicants.
- Program launched in June 2019 and applications accepted until March 31, 2029.
- Program provides transferable royalty and production tax credits equal to 15% of approved eligible costs.
- Eligible costs must involve a minimum investment of CAD$10 million.
- Credits can be claimed at a rate of 20% in Year 1, 30% in Year 2, and 50% in Year 3.
- Credits are automatically applied against crown royalties and freehold production taxes in Saskatchewan or transferable to other corporate entities with an IRIS BA ID.
- Unused credits expire on March 31, 2040, or as per the date set in the agreement.
- Examples of value-added processing activities include gas gathering systems, oil refineries, upgraders, gas processing plants, and carbon capture projects.
- Non-eligible activities include oil pipelines or rail loading facilities not connected to an eligible value-added project and gas gathering infrastructure with routine flaring.
- Additional information and contact can be done through ogpii@gov.sk.ca.
grant_single_labels|contact
ogpii@gov.sk.ca
