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The U.S. Senate passing the tax reform bill is pro-growth legislation that would help the domestic oil and gas industry, Jack Gerard, President and CEO of the American Petroleum Institute (API), said after the Senators passed the sweeping tax reform on Saturday.
“Proposals to lower the corporate tax rate and strengthen cost-recovery provisions can allow the oil and natural gas industry to continue investing billions of dollars in the U.S. economy and add to the 10 million U.S. jobs our industry currently supports,” said Gerard, as carried by The Maritime Executive.
“Pro-growth tax reform can support forward-looking energy policies to ensure our nation continues its global energy leadership. We encourage the House and Senate to move forward without delay to bring tax reform legislation to the president’s desk and implement a tax system that is smart, fair, and pro-growth for American consumers, businesses, and the economy,” Gerard said.
At the same time, environmental advocacy group Natural Resources Defense Council (NRDC) deplored the tax reform in a statement on Saturday, saying that “The tax scheme protects the oil and gas industry while cutting clean energy initiatives and destroying millions of acres of nature,” adding that, “The Senate just opened the door for drilling in the Arctic National Wildlife Refuge.”
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Before the tax bill was passed, oil tycoon Harold Hamm said on Friday that even with the corporate taxes cut, U.S. drillers would not return to the lavish spending days from before the downturn, because companies are now much more disciplined in their finances and looking to boost profits.
“That’s not the deal anymore, and finally the analysts and everybody else caught on. Shareholders caught on and said, ‘We’re not going to put money in there just for growth’s sake. We want a return, a good return on capital employed,’” Continental Resources’ chairman and chief executive Hamm told CNBC.
“That new dynamic has entered into the market, and it’s affecting everybody out here, and thank God it’s there,” Hamm said.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.