Amid record oil and gas production, the oil and natural gas industry in Texas paid a total of US$16.3 billion in local taxes and state royalties in fiscal year 2019-the highest taxes the industry has paid to the state of Texas on record, the Texas Oil & Gas Association (TXOGA) said in a new report.
"Despite challenges in the global marketplace, state and local taxes and state royalties paid by the Texas oil and natural gas industry shattered records last year - exceeding $16 billion," TXOGA President Todd Staples said in a statement, commenting on the figures.
The taxes and royalties paid in 2019 were up by 16 percent compared to the taxes the industry had paid in 2018, according to the association, which estimates that in 2019 the oil and gas industry contributed about US$44 million a day to state and local revenue.
The Texas oil and gas industry has paid more than US$149 billion in state and local taxes and state royalties since 2007, when TXOGA first started collecting data.
The increase in taxes and royalties comes as the crude oil production in Texas jumped from 4.72 million bpd in October 2018 to 5.27 million bpd in October 2019, while natural gas production increased from 25 billion cubic feet per day in October 2018 to 29 billion cubic feet per day in October 2019, TXOGA's report shows.
"Record-breaking oil and natural gas production levels pushed production or "severance" tax revenues to new highs. Drilling and completion of new wells have also kept sales tax revenues high, and both increased production and new wells drilled have kept property tax revenues high," TXOGA said in the report.
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The report comes at a time when Texas producers are struggling with associated gas which they are forced to burn-burning money-because of shortage of takeaway pipeline capacity and low natural gas prices.
The gas flaring in the Permian has reached record levels, but the association says that oil and gas companies are committed to working on improving their emissions profiles.
"I think Texas oil and natural gas companies are committed to making climate progress," TXOGA's Staples said at a conference call, as carried by the Houston Chronicle.
"They're committed to a lower emissions future," Staples noted.
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. More