Income Tax Act — I-3.3 66
) Canadian exploration and development expenses incurred by a taxpayer means any expense incurred before May 7, 1974 that is (a) any drilling or exploration expense, including any general geological or geophysical expense, incurred by the taxpayer after 1971 on or in respect of exploring or drilling for petroleum or natural gas in Canada, (b) any prospecting, exploration or development expense incurred by the taxpayer after 1971 in searching for minerals in Canada, (c) the cost to the taxpayer of any Canadian resource property acquired by the taxpayer after 1971, (d) the taxpayer’s share of the Canadian exploration and development expenses incurred after 1971 by any association, partnership or syndicate in a fiscal period thereof, if at the end of that fiscal period the taxpayer was a member or partner thereof, (e) any expense incurred by the taxpayer after 1971 pursuant to an agreement with a corporation under which the taxpayer incurred the expense solely in consideration for shares of the capital stock of the corporation issued to the taxpayer by the corporation or any interest in such shares or right thereto, to the extent that the expense was incurred as or on account of the cost of (i) drilling or exploration activities, including any general geological or geophysical activities, in or in respect of exploring or drilling for petroleum or natural gas in Canada, (ii) prospecting, exploration or development activities in searching for minerals in Canada, or (iii) acquiring a Canadian resource property, and (f) any annual payment made by the taxpayer for the preservation of a Canadian resource property, but, for greater certainty, does not include (g) any consideration given by the taxpayer for any share or any interest therein or right thereto, except as provided by paragraph (e), or (h) any expense described in paragraph (e) incurred by another taxpayer to the extent that the expense was, by virtue of that paragraph, a Canadian exploration and development expense of that other taxpayer; ( frais d’exploration et d’aménagement au Canada ) Canadian resource property of a taxpayer means any property of the taxpayer that is (a) any right, licence or privilege to explore for, drill for or take petroleum, natural gas or related hydrocarbons in Canada, (b) any right, licence or privilege to (i) store underground petroleum, natural gas or related hydrocarbons in Canada, or (ii) prospect, explore, drill or mine for minerals in a mineral resource in Canada other than a bituminous sands deposit or an oil shale deposit, (c) any oil or gas well in Canada or any real property or immovable in Canada the principal value of which depends on its petroleum, natural gas or related hydrocarbon content (not including any depreciable property), (d) any right to a rental or royalty computed by reference to the amount or value of production from an oil or a gas well in Canada, or from a natural accumulation of petroleum, natural gas or a related hydrocarbon in Canada, if the payer of the rental or royalty has an interest in, or for civil law a right in, the well or accumulation, as the case may be, and 90% or more of the rental or royalty is payable out of, or from the proceeds of, the production from the well or accumulation, (e) any right to a rental or royalty computed by reference to the amount or value of production from a mineral resource in Canada, other than a bituminous sands deposit or an oil shale deposit, if the payer of the rental or royalty has an interest in, or for civil law a right in, the mineral resource and 90% or more of the rental or royalty is payable out of, or from the proceeds of, the production from the mineral resource, (f) any real property or immovable in Canada (not including any depreciable property) the principal value of which depends on its mineral resource content other than where the mineral resource is a bituminous sands deposit or an oil shale deposit, (g) any right to or interest in — or, for civil law, any r