• About
  • Offices
  • Careers
  • News
  • Students
  • Alumni
  • Payments
  • EN | FR
Background Image
Bennett Jones Logo
  • People
  • Expertise
  • Knowledge
  • Search
  • FR Menu
  • Search Mobile
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
View all
Practices
Corporate Litigation Regulatory Tax View all
Industries
Capital Projects Energy Funds & Finance Mining View all
Advisory
Crisis & Risk Management ESG Strategy and Solutions Governmental Affairs & Public Policy
View Client Work
International Experience
Insights News Events Subscribe
Quarterly M&A Insights Quarterly Fintech Insights New Energy Economy Series ESG & the CIO
Business Law Talks Podcast Economic Outlook Class Actions: Looking Forward
People
Practices
Industries
Advisory Services
Client Work
About
Offices
News
Careers
Insights
Law Students
Events
Search
Alumni
Payments
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
 
Blog

New Legislative Changes for Saskatchewan Potash Sector

October 17, 2022

Written By Jessica Kennedy, Keely Cameron, Laura Glover and Martin Ignasiak

Potash is a critical mineral used as a replenishing agricultural fertilizer. As a result, millions of farmers around the world depend on potash. The Canadian province of Saskatchewan is the world's largest potash producer, followed by Russia and Belarus. As the sole producer in Canada, the Saskatchewan potash sector accounts for about 30 percent of global production.

Production in the Saskatchewan potash sector hit all-time record highs in 2021, reaching 14.2 million tonnes and sales hitting $7.6 billion. Despite this achievement, Saskatchewan potash production is expected to grow even more in 2022. Potash has become "geopolitically essential" internationally following Russia's invasion of Ukraine, according to Canadian Finance Minister Chrystia Freeland. In response to increasing global demand and growing concerns about food security, the Saskatchewan government has pledged to ramp up potash production to fill any market gaps left as a result of the sanctions placed on Russia and Belarus.

In light of this commitment, on September 15, 2022, the Saskatchewan legislature introduced The Subsurface Mineral Royalty Amendment Regulations, 2022, and The Potash Production Tax Amendment Regulations, 2022. These new amendments amend The Crown Minerals Act, The Subsurface Mineral Royalty Regulations, 2017 and The Mineral Taxation Act, 1983. Combined, these new amendments reduce the amount of royalties payable on potash production for eligible new mines.

In order to qualify as a new mine under the amendments, a potash mine must begin commercial production on or after January 1, 2023, and achieve an initial annual production capacity of over two million tonnes. Eligible new mines will receive reduced royalty payments for a period of 36-months, subject to prior written approval by the Minister of Energy and Resources.

The royalty reduction will be determined on an annual basis, with the specific amount calculated for individual potash producers according to (a) the overall quantity of potash they produced in the year (in K2O tonnes), and (b) the average price of potash received by the producer in the year.

The amendments will come into force on January 1, 2023.

Overall, these amendments represent the Saskatchewan government's continued commitment to encouraging investment into the province's robust potash-mining industry. The incoming royalty regime will have potash producers enjoying a lighter royalty burden on new mining investments in the province.

One of the objectives identified in Saskatchewan's Growth Plan, published in 2019, was to increase the annual value of potash sales to $9 billion by 2030. With the already record-breaking performance of the potash sector bolstered by these newly announced legislative changes, Saskatchewan is positioned to achieve this objective well before 2030.

If you have questions or comments about the amendments, please contact the authors.

Download PDF

Authors

  • Jessica  Kennedy Jessica Kennedy, Partner
  • Keely  Cameron Keely Cameron, Partner
  • Laura C. Glover Laura C. Glover, Associate
  • Martin  Ignasiak KC Martin Ignasiak KC, Partner

Bennett Jones at WPC 2023

Related Links

  • Insights
  • Media
  • Subscribe

Recent Posts

Blog

Generative Artificial Intelligence (AI): Canadian [...]

September 20, 2023
       

Blog

WPC 2023 Day Three: AI in the Energy Industry—Making Sense of the Noise

September 20, 2023
       

Blog

General Minimum Wage in Ontario will Rise to $ 16 [...]

September 19, 2023
       

Blog

Separate Corporate Personality Remains Alive and Well in Alberta

September 19, 2023
       

Blog

What to Expect in Beauty Industry M&A

September 19, 2023
       
Bennett Jones Centennial Footer
Bennett Jones Centennial Footer
About
  • Leadership
  • Diversity
  • Community
  • Innovation
  • Security
  • History
Offices
  • Calgary
  • Edmonton
  • Montréal
  • Ottawa
  • Toronto
  • Vancouver
  • New York
Connect
  • Insights
  • News
  • Events
  • Careers
  • Students
  • Alumni
Subscribe

Stay informed on the latest business and legal insights and events.

LinkedIn LinkedIn Twitter Twitter Vimeo Vimeo
© Bennett Jones LLP 2023. All rights reserved.
  • Privacy Policy
  • Disclaimer
  • Terms of Use
Logo Bennett Jones