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Senate committee debates tax break for restimulating inactive oil wells; fiscal note and scope questioned
Summary
Senate Bill 782 would allow a temporary tax exemption for restimulation of inactive horizontal oil and gas wells; proponents argued it could extend life of mature wells and spur local economic activity while the comptroller and others questioned the fiscal impact and definition of eligible wells.
The Senate Finance Committee heard testimony on Senate Bill 782, which would create a temporary tax exemption to encourage restimulation of inactive horizontal oil and gas wells.
Senator Kelly King, the bill’s sponsor, told the committee the measure would exempt service taxes for a qualifying well for up to 36 consecutive months or until exempt taxes equal the lesser of the restimulation cost or $750,000. The bill would require certification of eligible wells by the Railroad Commission.
Proponents said the exemption could prompt operators to invest in mature wells that…
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