Oklahoma oilman Mike Cantrell is surprising some energy leaders with a call for them to support an end to tax credits for the state’s oil and gas industry.
“The state of Oklahoma is in dire financial straits, in large part because the states oil and gas industry is in a depression, due to low prices,” wrote Cantrell on Facebook, according to the McCarville Report. “An industry that has historically contributed up to 30% of the state’s revenue is, by some estimates, now actually taking more from our state than we are contributing.”
He said he always thought what was good for oil and gas is good for Oklahoma.
“Today, I depart from that belief,” continued Cantrell, a leader in the Oklahoma Independent Petroleum Association and the Energy Resources Board. He said he is embarrassed by the fast growing number of school teachers that have to take a second or even a third job to make ends meet.
“In this tumultuous time, the state’s oil and gas industry should ‘step up’ and lead the way in surrendering all tax credits and even repealing or seriously modifying the ‘at risk well’ provision which was intended to allow small producers to apply for a gross production tax rebate on wells that lose money over a years time,” wrote Cantrell. “This provision has rarely cost the state more than 2 million a year in the 2 decades of its existence and has kept thousands of wells from being abandoned or even plugged.”
He said the 2015 estimate is over $130 million and that the same companies are only paying a 2% rate on new wells, an incentive that is costing the state upwards of $400 million.
“Taken together they are breaking the bank and must either be repealed or temporarily suspended until our financial condition improves.”
