Companion bills have been introduced in the Texas legislature togive small producers a break on gas and oil severance taxes inlight of foundering commodity prices. If enacted, legislation wouldtrigger a temporary suspension of severance taxes on productionfrom certain wells.
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Producer Relief Pending in TX Legislature
Companion bills have been introduced in the Texas legislature togive small producers a break on gas and oil severance taxes inlight of foundering commodity prices. If enacted, legislation wouldtrigger a temporary suspension of severance taxes on productionfrom certain wells. Relief would be triggered if the three-monthaverage price for gas hits $1.89/Mcf (NYMEX) or $15/barrel (NYMEX)for oil.. When the price trigger is reached, the severance taxwould be suspended until the three-month average rises above thetrigger price. Severance tax relief would apply to oil productionfrom leases with wells averaging 15 barrels/d or less and to gasproduction from leases with wells averaging 90 Mcf/d or less. Ifpassed by the legislature, the measure would take effectimmediately and last until Aug. 31 or until $45 million in taxrelief has been granted, whichever comes first.