The Saskatchewan Subsurface Mineral Royalty Amendment Regulations, 2025, formally codified as Saskatchewan Regulations 82/2025 under The Crown Minerals Act, introduces modifications to the Subsurface Mineral Royalty Regulations, 2017, specifically through the addition of Part 3.1, which governs brine minerals. These amendments establish a regulatory framework for the extraction, valuation, and royalty payment obligations associated with subsurface minerals recovered from natural brine aquifers, excluding potash and salt. The regulations define key terms such as “natural brine,” referring to formation water from aquifers more than 60 metres below the surface containing significant dissolved minerals, and “production facility,” indicating sites used to recover these minerals. The regulations also define “recovery” as the extraction and concentration of subsurface minerals to a minimum 99% purity or, where commercially appropriate, to lower purities. Recovery modules are specified as identifiable parts of production facilities capable of independently extracting minerals when supplied with natural brine, and revenue is broadly defined to include all consideration received in an arm’s-length transaction.

The regulations outline the calculation of royalties payable to the Crown, which are determined on a monthly basis using a formula in which the royalty is three percent of the value of sales, net of any applicable royalty holiday sales. The value of sales is defined as the revenue from arm’s-length transactions, minus processing costs required to achieve the final product grade and transportation expenses to the first purchaser. Arm’s-length transactions are carefully defined, incorporating provisions for related parties, corporate ownership, and the conduct of business to ensure independence. The regulations further provide detailed guidance on valuing minerals sold or disposed of under non-standard circumstances, including non-cash consideration, sales to affiliates, retention for personal use, or sales below 99% purity. The minister is empowered to determine fair market value where necessary, approve prices for non-arm’s-length transactions, and deem modified or expanded recovery modules as eligible for royalty holidays if they materially increase production capacity.

Compliance and reporting requirements are also detailed, including submission of monthly royalty returns and statements that specify quantities, purities, destinations, and pricing of all subsurface minerals extracted, recovered, or disposed of during the reporting period. These statements must reconcile production with beginning and ending inventory, identify transactions with affiliates, and report shipments by jurisdiction, including U.S. states and Canadian provinces. Submissions must be in a minister-approved form, signed under oath or affirmation, and comply with the prescribed reporting schedule. Additionally, quarterly payments must be made for royalties calculated over three-month periods, unless no minerals have yet been produced. The regulations grant the minister discretionary authority to resolve questions regarding royalty calculations or allowable deductions, with written notice provided to the royalty payer for any determinations made.

Saskatchewan (421/2025) October 7, 2025
Disclaimer: Insights are for informational purposes only and do not reflect RRI’s official position or constitute legal opinion.