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Proposed Pennsylvania Oil & Gas Severance Tax Moves Forward
Posted Thursday, June 25, 2009 ; 11:33 AM | View Comments | Post Comment

Bill now proceeds to the full House.

Story by Pam Kasey
Email | Bio | Other Stories by Pam Kasey

A bill that would establish a new oil and gas severance tax in Pennsylvania is moving forward.

The Natural Resource Severance Tax Act would establish a tax equivalent to West Virginia’s — 5 percent tax on the value of gas extracted plus 4.7 cents on every 1,000 cubic feet — and was approved June 23 by the Pennsylvania House Environmental Resources and Energy Committee.

“House Bill 1489 would ensure that Pennsylvania joins almost every gas-rich state in seeking a fair return for its taxpayers for the removal of a natural resource owned by the Commonwealth and requiring use of taxpayer-paid infrastructure to extract,” said Democratic Rep. Camille George, committee chair.

Pennsylvania is 15th nationally in natural gas production, and the 14 states with higher gas production all assess a severance tax or conservation fee, according to Citizens for Pennsylvania’s Future.

Gov. Ed Rendell proposed the tax in February, stating at that time that expected gas production from the Marcellus Shale would generate $100 million from the tax next year and $630 million annually in five yeas. The bill limits the tax to high-producing gas wells.

It now proceeds to the full House.

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