O'Neill, 23, returns to his hometown of Edmonton, where he spent four seasons with the University of Alberta Golden Bears before turning pro.
O'Neill was released by the Lions last week after he could not come to terms on a contract extension with B.C. He was drafted by the Lions in the second round (11th overall) in 2011 and served as Paul McCallum's understudy for his first two CFL seasons before seeing his first regular-season action this year.
He was due to become a free agent in February.
In four games with the Lions this season, O'Neill was good on four of five field-goal attempts, the longest from 40 yards. All of the attempts came in B.C.'s first two games as he replaced an injured McCallum.
O'Neill connected on six of seven convert attempts and punted 21 times for a 40.2-yard average.
Grant Shaw has handled Edmonton's kicking duties this season. Shaw, a 29-year-old Edmonton native who is in his fourth CFL season, remains with the Eskimos.