Louisiana House Bill HB868

Louisiana 2010 Regular Session

• Introduced: 3/29/10
• Refer: 3/29/10

Caption

Provides relative to applications for two-year inactive well certifications (OR SEE FISC NOTE GF RV)

Impact

The bill's effects on state laws include a significant revision of the existing application process linked to severance tax exemptions. Previously, operators had to submit applications before they could qualify for an exemption after returning to service. By removing this stipulation, HB 868 intends to ease bureaucratic hurdles and potentially increase production levels from previously inactive wells. This legislative change could lead to a boost in state revenue from oil and gas production over time, as reactivated wells contribute once again to the tax base.

Summary

House Bill 868, introduced by Representative Robideaux, aims to amend existing laws regarding the severance tax applied to natural resources, specifically oil and gas. The bill proposes the deletion of the requirement that applications for two-year inactive well certifications must be filed before the commencement of production. By simplifying this process, the legislation seeks to encourage the resumption of production from inactive wells and provide financial relief for well operators who face a prolonged period of inactivity.

Sentiment

General sentiment around HB 868 appears to be supportive among those invested in the oil and gas sector. Stakeholders view the bill as a pro-business measure that can alleviate the financial burdens tied to resuming operations after inactivity. However, there may also be concern among environmental advocates regarding the implications of encouraging production without stringent oversight, which could lead to increased scrutiny over potential environmental impacts.

Contention

Notable points of contention surrounding HB 868 relate primarily to the balance between economic benefits and environmental responsibilities. Critics may argue that by facilitating easier access to tax exemptions and reducing regulatory requirements, the bill could encourage reckless drilling practices or exacerbate the impacts on local ecosystems. The ongoing tension between energy production and environmental conservation will likely remain a focal point of discussion as the bill is further debated within legislative chambers.