Google Translate Disclaimer

A number of pages on the Government of Saskatchewan's website have been professionally translated in French. These translations are identified by a yellow box in the right or left rail that resembles the link below. The home page for French-language content on this site can be found at:

Renseignements en Français

Where an official translation is not available, Google™ Translate can be used. Google™ Translate is a free online language translation service that can translate text and web pages into different languages. Translations are made available to increase access to Government of Saskatchewan content for populations whose first language is not English.

Software-based translations do not approach the fluency of a native speaker or possess the skill of a professional translator. The translation should not be considered exact, and may include incorrect or offensive language. The Government of Saskatchewan does not warrant the accuracy, reliability or timeliness of any information translated by this system. Some files or items cannot be translated, including graphs, photos and other file formats such as portable document formats (PDFs).

Any person or entities that rely on information obtained from the system does so at his or her own risk. Government of Saskatchewan is not responsible for any damage or issues that may possibly result from using translated website content. If you have any questions about Google™ Translate, please visit: Google™ Translate FAQs.

Waterflood Development Program

The Waterflood Development Program (WDP) offers repayable royalty/freehold production tax deferral for eligible wells that have been converted to injection wells or newly drilled injection wells for the purpose of waterflooding an oil reservoir.

Waterflooding is a secondary oil recovery technique that utilizes non-potable water for re-injection into the oil reservoir to restore reservoir pressure and sweep the oil to nearby producing wells. Waterflooding is a capital intensive undertaking and the time period before a response in the reservoir can be lengthy. As such, WDP is designed to help offset initial capital investments by providing a three-year repayable royalty credit for eligible waterflood injection wells.

Top

1. Benefits

  • WDP provides a repayable royalty deferral with a low interest rate to eligible wells for a period of three years. The royalty deferral is applied at the corporate level.
  • Beginning in the fourth year, the repayable royalty deferral and accrued interest is returned to the Ministry of Energy and Resources in 10 monthly instalments.
  • WDP repayable royalty deferral amounts for eligible wells:
    • Drilling a new dedicated horizontal injection well – $1,000,000.
    • Drilling a new dedicated vertical injection well – $500,000.
    • Converting a vertical or horizontal production well to an injection well – $500,000.
  • WDP can be used alongside other incentive and grant programs available in Saskatchewan.
Top

2. Eligibility

To qualify for the WDP your company must be the licensee of an injection well that has first injected water on or after January 1, 2019, and before April 1, 2024, and is approved as part of a waterflood project pursuant to Section 17 of The Oil and Gas Conservation Act.

The applicant must also pass a financial stress test that consists of the following four measures:

  1. The applicant does not have outstanding debts that are past due to the Ministry of Energy and Resources;
  2. The applicant has a Licensee Liability Rating (LLR) of 2.0 or greater as established by the Ministry of Energy and Resources;
  3. The applicant's cumulative value of outstanding royalty deferrals does not exceed 30% of the applicant's average monthly value of oil production; and,
  4. Provide any additional information, as requested by the Minister of Energy and Resources.

Please refer to the Waterflood Development Program Information Circular for more information.

Top

3. How To Apply

To apply for the WDP, companies need to complete and submit the WDP Application Form to PetroleumRoyalties@gov.sk.ca. If you have questions about the application process, refer to the Waterflood Development Information Circular or contact PetroleumRoyalties@gov.sk.ca.

The ministry will be accepting applications between December 1, 2019, and December 31, 2024.

Top

4. Application Documents

Top

5. Further Information

For additional information on the program, contact: PetroleumRoyalties@gov.sk.ca

We need your feedback to improve saskatchewan.ca. Help us improve