Parnell Anticipating New Production with Oil Tax Reform

Posted: April 23, 2013 at 7:39 am

The dominating talk during the state legislatures’s 90-days in Juneau was changing the state’s current oil tax policy. Both chambers of the legislature passed Senate Bill 21, Governor Sean Parnell’s legislation to reform oil taxes in the state. We recently spoke to Parnell, about the passed legislation

 

Gov. Parnell: “The bill itself is focused on production, the new tax regime has two elements in it that really focus on new production. There’s something called the Gross Revenue Exclusion, there’s also a per barrel credit in the bill. Those two items are focused on new production, meaning they get the tax benefit if they produce new oil and more oil. Bottom line is, this is focused on new production and we’re already seeing the benefits of it.”

 

Parnell said that recent announcements from BP and ConocoPhillips carry some weight

 

Gov. Parnell: “These companies are mid-year in their fiscal years, so any announcements that were made represent moves of capital from other projects. Their new fiscal year and new projects in larger scale get announced in the November time frame, when they talk to a securities analyst and release their plans for the next winter. I’m looking forward to the fall and early winter for some more announcements of work.”

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