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Kansas oil and gas producers tell Utilities Committee rising costs, regulation and low rig counts threaten marginal wells
Summary
Dana Reath, chair of the Kansas Independent Oil and Gas Association, told the Utilities Committee that marginal Kansas wells face growing economic pressure from rising input costs and regulatory compliance, putting local jobs and county revenues at risk.
Dana Reath, chair of the board of the Kansas Independent Oil and Gas Association and a Wichita production company employee, told the Utilities Committee that Kansas oil and gas output generated roughly $2.4 billion in production value in 2023 and about $3.0 billion in family income.
Reath said the industry paid roughly $186 million in taxes in 2023 and broke that figure into components she attributed to severance and ad valorem taxes: about $48 million in severance and $137 million in ad valorem payments. She also said producers pay a per-barrel and per-Mcf fee that supports the Kansas Corporation Commission’s Oil and Gas Conservation Division. "Every oil well is like a small business," Reath said, arguing the combination of small average well yields and rising input costs makes many wells financially marginal.
Why it matters: Reath told the committee…
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