HLS 10RS-1740 ORIGINAL
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2010
HOUSE BILL NO. 868
BY REPRESENTATIVE ROBIDEAUX
TAX/SEVERANCE TAX: Provides relative to applications for two-year inactive well
certifications
AN ACT1
To amend and reenact R.S. 47:633(7)(c)(iv)(aa), relative to the severance tax on oil and2
natural gas; to provide relative to qualifications for inactive well status; to delete3
certain application requirements; to provide for an effective date; and to provide for4
related matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 47:633(7)(c)(iv)(aa), is hereby amended and reenacted to read as7
follows: 8
ยง633. Rates of tax9
The taxes on natural resources severed from the soil or water levied by R.S.10
47:631 shall be predicated on the quantity or value of the products or resources11
severed and shall be paid at the following rates:12
* * *13
(7)(a)14
* * *15
(c)(i)16
* * *17
(iv) Production from oil and gas wells shall be exempt from severance tax18
for a period of five years when returned to service after being inactive for two or19
more years or having thirty days or less of production during the past two years. The20 HLS 10RS-1740 ORIGINAL
HB NO. 868
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
exemption shall be extended by the length of any inactivity of a well that has1
commenced production when such inactivity is caused by a force majeure.2
(aa) To qualify for inactive well status, an application for a two-year inactive3
well certification shall be made to the Department of Natural Resources, before4
commencement of production, during the period beginning July 31, 1994, and ending5
June 30, 2000, for the period beginning July 1, 2002, and ending June 30, 2006, and6
for the period beginning July 1, 2006, and ending June 30, 2010. Upon certification7
that a well is inactive, all production is exempt from severance tax for a period of8
five years from the date production begins or ninety days from the date of the9
application, whichever occurs first.10
* * *11
Section 2. This Act shall become effective on July 1, 2010; if vetoed by the governor12
and subsequently approved by the legislature, this Act shall become effective on July 1,13
2010, or on the day following such approval by the legislature, whichever is later.14
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Robideaux HB No. 868
Abstract: Deletes the requirement that applications be filed before commencement of
production.
Present law requires a tax on natural resources severed from the soil or water to be
predicated on the quantity or value of the products or resources severed. Further provides
that production from oil and gas wells shall be exempt from severance tax for five years
when returned to service after being inactive for two or more years or having 30 days or less
of production during the past two years.
Present law requires that in order to qualify for inactive well status, an application for a two-
year inactive well certification shall be made to the Dept. of Natural Resources, before
commencement of production, for the period beginning July 1, 2006, and ending June 30,
2010.
Proposed law deletes the requirement that the application be filed before commencement of
production.
Effective July 1, 2010.
(Amends R.S. 47:633(7)(c)(iv)(aa))