The prescribed annual Liability Reduction Percentage (LRP) is the industry-wide percentage of inactive liabilities that are to be retired in a calendar year. The annual LRP will increase over time in order to achieve the goal of reducing inactive liabilities in the province. With the commencement of the Inactive Liability Reduction Program (ILRP) in January 2023, the LRP percentage is set at 5%. A licensee’s total inactive liability will be multiplied by the LRP in order to establish their reduction target for the year.
The Ministry of Energy and Resources will calculate the LRP in June of each year and notify licensees of the next year’s percentage. In October, each licensee’s required spend for the following calendar year will be calculated and communicated based on the LRP established.To provide industry with some certainty around the program and expected expenditure requirements for their budgeting purposes, the ministry has forecasted the LRP for future years. Note, however, that these values are simply forecasted and are subject to change based on economic circumstances.
| Year | LRP |
| 2023 | 5% (set) |
| 2024 | 6% (set) |
| 2025 | 6% (set) |