B.C. Energy Ministry Says Four Calculation Errors Caused $1.5B Budget Mistake

Emma MacLeod

9/2/20262 min read

British Columbia’s Ministry of Energy and Climate Solutions says four calculation mistakes were responsible for a nearly $1.5-billion error in the province’s 2026 budget projections for natural gas royalties.

Senior ministry officials released a summary of the errors Tuesday, detailing problems in the calculations used to estimate how much natural gas royalty revenue B.C. expected to collect over the next five years.

The largest mistake involved incorrectly applying a U.S.-to-Canadian dollar conversion rate to figures that were already expressed in Canadian currency.

“A formula was incorrectly dragged across cells,” a ministry representative said.

Multiple Spreadsheet and Forecasting Errors Identified

The ministry said another error involved incorrectly converting natural gas volumes between units.

Two additional mistakes occurred when staff used cost inputs from 2025 rather than the correct 2026 figures.

Together, the four errors caused the province to significantly overstate its expected natural gas royalty revenue.

Last week, the premier’s office acknowledged that Budget 2026 had overstated projected royalties by an average of approximately $292 million annually over five years.

That amounts to close to $1.5 billion in total.

Senior ministry staff said the mistakes were made by technical personnel within the ministry.

“This was a human-caused and regrettable error made by a mistake on a spreadsheet,” a spokesperson said.

The ministry says new quality assurance and quality control procedures have since been introduced.

Treaty 8 Experts Raised Concerns Earlier

Experts working with Treaty 8 First Nations initially flagged concerns about the royalty projections to Premier David Eby, Energy Minister Adrian Dix and then-finance minister Brenda Bailey earlier in the summer.

The government did not publicly acknowledge the problem until Business in Vancouver reported on the discrepancy last week.

Treaty 8 First Nations are located in northeastern British Columbia, where much of the province’s natural gas production takes place.

Those First Nations receive a portion of the natural gas royalties collected by the provincial government.

James Tate, a lawyer working with a Treaty 8 First Nation, said efforts to obtain answers from the province about the apparent errors and broader concerns over the royalty system had been difficult.

“Our experts, we as advisers, the chiefs directly, have been asking for a full transparent technical review for weeks with absolute silence on their part,” Tate said.

Provincial Deficit Expected to Increase

British Columbia’s government previously projected a $13.3-billion deficit for the current fiscal year.

That figure is now expected to increase once the natural gas royalty forecasting error is formally incorporated into the province’s finances.

An updated fiscal outlook is expected later this month.

The size of the adjustment will depend on how the corrected royalty forecasts are reflected in the government’s revised financial projections.

Ministry Says New Royalty Framework Unaffected

The ministry stressed that the calculation errors are separate from B.C.’s new natural gas royalty framework, which is scheduled to take effect Jan. 1, 2027.

Officials said the mistakes have no effect on the new system.

The framework is designed to increase the public share of profits generated by natural gas development, with the province aiming to capture approximately 50 per cent of industry profits through the updated royalty structure.

The government says additional oversight measures are now in place to reduce the risk of similar forecasting errors occurring in future budgets.

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