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“Right now it makes a great deal of sense to go in and acquire rights in the oil sands,” Trevor Newton, chairman of Strata Oil & Gas Inc., said in a phone interview. “Let’s get this now while we can. We are going to get them cheaper.”

The province holding most of Canada’s crude reserves, the world’s third largest, drew an average of $476.14 per hectare (US$978 per acre) in offerings of rights through April, the most seasonally since 2007, data on the province’s website show.

Biggest Buy

The biggest purchase was by LandSolutions LP, which buys rights on behalf of oil producers. The land company paid $7,816 a hectare, government data show. The purchase was for carbonate reserves located under Shell’s Peace River operations, said Strata’s Newton, whose company bid unsuccessfully for the reserves.

The increase in lease prices is a bright spot for Alberta, where revenue from leases and permits fell to $24.1 million in the fiscal year ended March 31 compared with $25.1 million a year earlier.

Companies have been pulling back rather than investing. Shell withdrew an application to develop the Pierre River oil sands mine in February, the same month Cenovus suspended an expansion of its Christina Lake project.

Oil royalties will account for just 7 per cent of Alberta’s revenues this fiscal year, down from almost 20 per cent a year ago, according to the budget released in March. The province’s Progressive Conservative government, which increased income and gasoline taxes to help cushion the revenue loss, was swept from office in elections this month after 44 years in power.