Relating to calculation of daily production for purposes of the oil and gas production tax credits for low-producing wells and leases.
Impact
The implementation of SB925 is likely to streamline the process for determining which low-producing wells and leases qualify for tax credits. This change is expected to reduce administrative burdens both for operators of low-producing wells and the regulatory bodies involved. By clarifying the calculation process, the bill may lead to increased participation by eligible operators taking advantage of the tax benefits, thereby potentially enhancing production efforts of marginal wells.
Summary
Senate Bill 925 aims to revise the calculation methods for assessing daily production levels of oil and gas from low-producing wells and leases for the purposes of tax credits. The bill specifically defines 'qualifying low-producing wells' as gas wells whose average production during a three-month period does not exceed 90 thousand cubic feet (mcf) per day. The revisions also adjust how production reports are evaluated, utilizing the greater of monthly production figures reported to the Texas Commission and the Comptroller’s office.
Sentiment
The general sentiment surrounding SB925 appears to be positive, with the bill passing unanimously in both the Senate and House, indicating broad bipartisan support. Lawmakers have positioned the bill as favorable to operators of low-producing wells, who, in the absence of such provisions, may struggle to maintain viability under the existing tax framework. Given the unanimous voting record, it reflects a consensus on its necessity and anticipated beneficial outcomes.
Contention
Despite the unanimous support for SB925, some concerns have been raised regarding the potential for misinterpretation of production figures and the broader implications for state tax revenues. While proponents argue that easing tax burdens will encourage greater oil and gas production, critics warn that an overly lenient approach could lead to unintended consequences, such as reduced state revenue from oil and gas operations. This indicates a broader discussion about balancing tax incentives with fiscal responsibility in state budgeting.
Relating to the reduction and plugging of orphaned oil and gas wells; providing for the imposition of a fee and an exemption from certain taxes and fees.
Relating to the reduction and plugging of orphaned oil and gas wells; providing for the imposition of a fee and an exemption from certain taxes and fees.
Relating to the promotion of film and television production in this state, including the eligibility of film or television productions for funding under the major events reimbursement program, the creation of a film events trust fund and a film production tax rebate trust fund, the establishment of virtual film production institutes, and the designation of media production development zones.