Nathan Tanner and
Alberta’s Oil Sands Policy

Nathan Tanner (1898-1982) was born in Salt Lake City, Utah, but grew up in southern Alberta. He was a teacher and businessman until he was elected to the Alberta Legislature in 1935. After serving as Speaker of the House for two years, he became a member of William Aberhart’s cabinet as Minister of Lands and Mines in 1937. He continued to be the minister responsible for issues relating to the oil sands until his retirement in 1952. He was also chairman of the Research Council of Alberta from its revival in 1943 until 1952.

In September 1951, Tanner was the featured speaker at the Athabasca Oil Sands Conference dinner. His topic was “Government Policy Regarding Oil-Sand Leases and Royalties.” To the assembled delegates, he summarized the state of the oil business in Alberta, and assured them of the government’s interest in developing the oil sands resource:

We are quite prepared and anxious to have you come in and spend your risk capital in the development of our natural resources. We want to give you a good run for your money. We want you to know that if you are successful in the search, that you will get a profit out of the development and the production. At the same time, we would like you to know that we are going to try to be at the end of the rainbow to get our share at the same time.

Tanner then released the government’s oil sands policy. The printed version distributed to conference delegates

starts with the declaration:

The Alberta Government is desirous of doing all that is reasonably possible to encourage the orderly development of the enormous oil sands’ [sic] deposits in the interest of the people of the Province and of Canada as a whole, and, further, to the security of this continent.

This sentiment doubtless reflects the recent memory of World War II and the contemporary events in Korea.

The policy Tanner outlined let companies take out “prospecting permits” of up to 50,000 acres for one-year periods (no more than one permit per company) and renew them for up to two more years. They could then lease enough of the permit area to support an oil sands plant. Initial royalties would not exceed 10%, annual rentals on each lease would be $1.00 an acre, and the remainder of the exploration area would revert to the province.

Many oil companies participated in the conference, and shortly after its conclusion a dozen took out exploration permits. None of the companies with permits proceeded immediately to the lease stage. The main reason was a government stipulation that the lessee must begin construction of a commercial plant within two years of receiving the lease, and begin operating the plant within five. The government later changed the rule so the lessee’s obligation was to build within a year of receiving a government order to do so. The government pledged to be reasonable in making such requests, and several companies took out leases.