Most states charge natural-gas drilling companies fees or taxes based on how much gas comes out of wells, but not Pennsylvania, which charges an impact fee. That is causing problems in a state where the Marcellus shale gas production has
soared, but revenue to local and state governments isn't keeping pace, reports The Associated Press.
The impact fee in 2011 brought in about $204 million, with production about 1 trillion cubic feet of gas, reports AP. In 2012, production doubled to 2 trillion, but the impact fee was $199 million. One billion cubic feet of gas is the energy equivalent of about 180,000 barrels of oil.
"Over 20 or 30 years, that means the current impact fee here may generate $10 billion or $15 billion less than a flat tax on production," Michael Wood, research director for the Pennsylvania Budget & Policy Center, told AP. "That gap is going to get bigger and bigger."
Patrick Henderson, Gov. Tom Corbett's energy executive, told AP oil and gas operators have paid more than $1.7 billion in corporate state taxes since 2007. He said Corbett “was proud to partner with the General Assembly in crafting a fair impact fee intended to encourage development in Pennsylvania.” (Read more) The graphic is by the Pennsylvania Department of Environmental Protection.
The impact fee in 2011 brought in about $204 million, with production about 1 trillion cubic feet of gas, reports AP. In 2012, production doubled to 2 trillion, but the impact fee was $199 million. One billion cubic feet of gas is the energy equivalent of about 180,000 barrels of oil.
"Over 20 or 30 years, that means the current impact fee here may generate $10 billion or $15 billion less than a flat tax on production," Michael Wood, research director for the Pennsylvania Budget & Policy Center, told AP. "That gap is going to get bigger and bigger."
Patrick Henderson, Gov. Tom Corbett's energy executive, told AP oil and gas operators have paid more than $1.7 billion in corporate state taxes since 2007. He said Corbett “was proud to partner with the General Assembly in crafting a fair impact fee intended to encourage development in Pennsylvania.” (Read more) The graphic is by the Pennsylvania Department of Environmental Protection.
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