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Thursday, January 7, 2016

President of Ohio Oil and Gas Association Posts 2015 Year in Review, Says Increased Severance Tax Not Expected Anytime Soon

From the OOGA:
I would like to take a moment to reflect on past year and all that has materialized within the Ohio Oil and Gas Association in 2015. As I reflect on what we’ve seen over the year, the litany of issues the industry has faced this particular year have been seemingly insurmountable. I can't think of any time in the last 40-years where the hill to climb has seemed so high. 
We have seen crude oil prices fall below $40 per barrel and natural gas prices are languishing at record lows, creating a general sense of gloom and doom among our industry on a global scale. 
The price rut, brought to us mainly by Saudi Arabia, which is making an effort to control market share, is wreaking havoc on the United States’ domestic oil and gas industry. Decisions made half way around the globe are having real life implications right here in Ohio. Simultaneously, the collapse of the natural gas price in Appalachia, mainly due to lack of adequate infrastructure to get the gas out of the basin, is making life practically impossible for many members of the Ohio Oil and Gas Association. 
Seeking Resolution: 
All while this was going on, some of our elected officials in Ohio still believed that this would be a good time to increase the severance tax. After months of interested party meetings with the Administration, affected agencies and appointed House and Senate members to the 2020 Tax Policy Study Commission, I am pleased to report that it looks like we won’t have to discuss the severance tax for the next year or so. 
The Association went through every aspect of oil and gas taxation from cost recovery to post production with the group. It was truly a thorough process, and we believe the Commission finally realized that the industry was not over exaggerating our dire situation.
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