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B.C. Reg. 145/2019
O.C. 374/2019
Deposited June 26, 2019
This consolidation is current to January 18, 2022.
Link to consolidated regulation (PDF)
Link to Point in Time

Income Tax Act

Natural Gas Tax Credit Regulation

[Last amended November 7, 2019 by B.C. Reg. 232/2019]

Contents
1Definitions
1.1Prescribed amount of LNG
1.2Reference point
2Prescribed percentage
2.1Pipeline fuel and losses adjustment
3Interest on percentage owing to government
4Interest on tax refunds
5Reference price

Definitions

1   In this regulation:

"Act" means the Income Tax Act;

"Compressor Station 2" means the compressor station located at 55° 38' 54.76" north latitude and 122° 12' 30.70" west longitude on the natural gas pipeline known as the Westcoast Transmission System.

[en. B.C. Reg. 232/2019, s. 1.]

Prescribed amount of LNG

1.1   For the purposes of paragraph (b) of the definition of "major LNG facility" in section 172 of the Act, the prescribed amount of LNG per year is 2 million tonnes.

[en. B.C. Reg. 232/2019, s. 2.]

Reference point

1.2   For the purposes of the definition of "reference point" in section 177 of the Act, the prescribed reference point is Compressor Station 2.

[en. B.C. Reg. 232/2019, s. 2.]

Prescribed percentage

2   For the purposes of section 173 (4) of the Act, the prescribed percentage is 2.5%.

Pipeline fuel and losses adjustment

2.1   (1) For the purposes of section 180 of the Act, a corporation's pipeline fuel and losses adjustment, in respect of a major LNG facility and for the month, is the amount determined by the following formula:

pipeline fuel and
losses adjustment
 =             volume variance            
adjusted LNG facility inlet volume
 × 100%
 where   
volume variance = the amount determined under subsection (2) for the month;
adjusted LNG facility inlet volume = the total of the following:
(a) the volume of natural gas deemed to have been purchased under section 178 of the Act by the corporation in the month at an LNG facility inlet meter for the major LNG facility;
(b) the volume of natural gas disposed of by the corporation in the month at an LNG facility inlet meter for the major LNG facility;
(c) the volume of natural gas disposed of by the corporation in the month while that natural gas is in the feedstock pipeline that delivers natural gas to the major LNG facility.

(2) For the purposes of the description of "volume variance" in subsection (1), the amount determined for the month is the amount determined by the following formula:

volume variance = feedstock pipeline
inlet volume
 + acquisitions − dispositions − change in inventory − LNG facility
inlet volume
 where   
feedstock pipeline inlet volume = the volume of natural gas owned by the corporation that passes, in the month, through the feedstock pipeline inlet designated in respect of the major LNG facility;
acquisitions = the volume of natural gas acquired by the corporation in the month
(a) while that natural gas is in the feedstock pipeline that delivers natural gas to the major LNG facility, or
(b) at an LNG facility inlet meter for the major LNG facility from a person or partnership;
dispositions = the volume of natural gas disposed of by the corporation in the month
(a) while that natural gas is in the feedstock pipeline that delivers natural gas to the major LNG facility, or
(b) at an LNG facility inlet meter for the major LNG facility;
change in inventory = the volume of natural gas equal to the volume of natural gas owned by the corporation and in the feedstock pipeline at the end of the month less the volume of natural gas owned by the corporation and in the feedstock pipeline at the end of the preceding month;
LNG facility inlet volume = the volume of natural gas notionally acquired by the corporation at an LNG facility inlet meter for the major LNG facility in the month.

[en. B.C. Reg. 232/2019, s. 2.]

Interest on percentage owing to government

3   (1) For the purposes of section 194 (4) of the Act, interest payable to the government under Part 13 of the Act must be calculated on a daily basis and compounded monthly.

(2) For the purposes of section 194 (4) of the Act, the rate of interest prescribed is, during each successive 3 month period beginning on April 1, July 1, October 1 and January 1 in each year, 3% above the prime lending rate of the principal banker to the Province on the 15th day of the month immediately preceding that 3 month period.

Interest on tax refunds

4   (1) Interest payable under section 197 (2) of the Act must be calculated on a daily basis and compounded monthly.

(2) For the purposes of section 197 (2) of the Act, the rate of interest prescribed is, during each successive 3 month period beginning on January 1, April 1, July 1 and October 1 in each year, 2% below the prime lending rate of the principal banker to the Province on the 15th day of the month immediately preceding that 3 month period.

Reference price

5   In determining the reference price for the purposes of section 180 of the Act, the minister charged with the administration of the Petroleum and Natural Gas Act must consider the monthly Natural Gas Exchange Inc.'s NGX AB-NIT natural gas price indices that relate to any period in the month.

[Provisions relevant to the enactment of this regulation: Income Tax Act, R.S.B.C. 1996, c. 215, s. 213.