In Québec, the rules governing the issue of oil and gas titles are set out in the Mining Act. They are based on the principle of universal access to the resource. Titles, which confer an exclusive right to explore for and extract mineral substances such as oil and gas, are issued on a first come, first served basis.

Conditions

Gives the holder an exclusive right to explore for petroleum and natural gas, and underground reservoirs.

May cover up to 25 000 hectares. Licences are issued using a uniform grid system. Each pre-determined parcel covers approximately 2 000 hectares.

Is valid for five years.

May be renewed for a further five years, one year at a time.

Allows the holder of several licences to group them together in calculating expenditure on compulsory work.

Obligations

Pay an annual fee of 10¢ per hectare onshore, and 5¢ per hectare offshore for an area of at least 100 000 hectares. From the 6^th year, the fee is 50¢ per hectare at each renewal.

Carry out compulsory work representing a minimum expenditure of 50¢ per hectare in the first year, rising by 50¢ per year to $2.50 in the fifth year.

Submit a technical and financial report at the end of each year.

Conditions

Valid for 20 years

Renewable if the reserves are sufficient

May cover an area of 200 to 2 000 hectares

Obligations

Pay an annual rent of $2.50 per hectare.

Pay a royalty of between 5% and 12.5% of market value at the wellhead for petroleum, and between 10% and 12.5% for natural gas.

Conditions

Valid for 20 years

Obligations

Pay the annual rental, which varies depending on the amount of gas extracted:

• less than 50 Million (M) cubic metres: $250/Mm³
• from 50 to 100 Million (M) cubic metres: $500/Mm³
• from 100 to 250 Million (M) cubic metres: $750/Mm³
• over 250 Million (M) cubic metres: $1000/Mm³