Alberta Coal Royalty Rates

Alberta's current coal royalty rates are set under the Coal Royalty Regulation and vary based on the type of coal and the stage of mine development:

1. Subbituminous (Plains) coal:

   • Flat rate of $0.55 per tonne6

2. Bituminous (Mountain/Foothills) coal:

   • Before mine payout: 1% of mine mouth revenue

   • After mine payout: 1% of mine mouth revenue plus 13% of net revenue65

Mine payout refers to the point when a mine's cumulative gross revenues equal its cumulative costs and allowances2.

The Alberta government has announced plans to significantly increase coal royalty rates for new mines as part of the Coal Industry Modernization Initiative (CIMI) to be implemented in late 202534. This increase aims to ensure fair compensation for the province's coal resources while balancing responsible development with environmental protection8.

Key points about the upcoming changes:

1. Royalty rates will be "substantially increased" for new coal mines34.

2. The exact new rates have not been determined yet, as the government plans to consult with industry stakeholders in early 202513.

3. The changes are part of a broader initiative to modernize Alberta's coal policy, including stricter environmental regulations and a ban on new open-pit and mountaintop removal mining in the eastern slopes of the Rocky Mountains48.

It's worth noting that coal royalties in Alberta have ranged between $7 million and $23 million per year over the past five years, with $7.3 million collected in 20216.

Citations:

1. https://www.chemanalyst.com/NewsAndDeals/NewsDetails/alberta-government-to-introduce-stricter-coal-mining-regulations-32485
2. https://albertawilderness.ca/can-benga-deliver-on-its-coal-royalties-promises/
3. https://edmontonjournal.com/news/politics/alberta-announces-new-coal-mining-policy-plan-industry-consults
4. https://www.mining.com/alberta-to-introduce-modern-coal-policy-including-ban-on-new-open-pit-projects/
5. https://ablawg.ca/2021/02/11/coal-law-and-policy-in-alberta-part-2-the-rules-for-acquiring-coal-rights-and-the-royalty-regime/
6. https://www.alberta.ca/coal-royalties-and-reporting
7. https://abpolecon.ca/2025/01/10/pinocchios-aplenty-fact-checking-albertas-coal-industry-modernization-initiative/
8. https://www.vauxhalladvance.com/news/2025/02/06/naughty-or-nice-province-announces-new-coal-mining-initiative/
9. https://www.stalbertgazette.com/local-news/what-are-albertas-contractual-obligations-to-coal-companies-10027425
10. https://www.alberta.ca/royalty-overview
11. https://www.cbc.ca/news/canada/calgary/coal-montem-brian-jean-evolve-cabin-ridge-atrum-elan-1.7434338
12. https://www.canlii.org/en/ab/laws/regu/alta-reg-295-1992/latest/alta-reg-295-1992.html
13. https://training.energy.gov.ab.ca/Guides/1993CoalRoyaltyGuidelines.pdf
14. https://claresholmlocalpress.ca/2025/new-rules-governing-coal-development-in-the-works/
15. https://cirl.ca/sites/default/files/teams/1/SMLS/2022/Coal%20in%20Alberta%20January%2015%202022.pdf
16. https://calgary.citynews.ca/2024/12/20/alberta-coal-mining-policy-plan/
17. https://training.energy.gov.ab.ca/Forms/Coal5_Bituminuous_Royalty_Rpt.xlsx
18. https://www.alberta.ca/coal-industry-modernization-initiative
19. https://mining.ca/wp-content/uploads/dlm_uploads/2021/06/ComparativeReviewoftheRateofRoyalty.pdf
20. https://www.cbc.ca/news/canada/calgary/alberta-coal-rebecca-schulz-brian-jean-mining-1.7416183