Ohio Lawmakers Warned Again That High Severance Tax Could Scare Away Drillers
From Columbus Business First:
Ohio’s Utica shale play is promising but no more unique than other oil and gas fields across the country, the head of the state’s top oil and gas trade group told legislators Wednesday.
Tom Stewart, the Ohio Oil and Gas Association’s executive vice president, was making the case for a 1 percent severance tax on the net value of oil, natural gas and gas liquids from horizontally drilled shale wells in their first five years of production.
In essence, his point was if Ohio’s rate is too high, nothing is stopping producers from going elsewhere.
Stewart and other proponents of House Bill 375 testified during a second hearing on the bill, which calls for the tax rate to rise to 2 percent after the first five years. The bill allows the rate to drop down to 1 percent when oil and gas wells fall to marginal production levels.