- In the past few months, nearly every operating E&P company has announced a reduced budget for 2015 in response to low natural gas and oil prices – some up to 100% cuts.
- Cycles in prices of oil and natural gas are nothing new to the industry, and something companies do their best to manage through until prices increase.
- Real people, real Pennsylvanians, have already been laid off across the Commonwealth from E&P companies to environmental firms to service provides as a result.
- The proposed 7.5% Severance Tax will further gouge operating budgets and not only reduce the amount to spend, but reduce the incentive to spend to bring more natural gas wells online
- The 7.5% Severance Tax has been touted to “raise $1 billion” – but at current production rates and prices of the ACTUAL price of gas at the wellhead – not the Henry Hub pricing, which the Governor’s team has been using – the numbers just don’t add up
- As of April, nearly $830 million will be paid from Impact Fees, money which has gone to projects across Pennsylvania – bust most importantly, back into the areas seeing the most activity to help with projects like traffic areas, lowering property taxes and reinvesting in environmental projects – all of which is now in jeopardy.
Below are links to several stories from around region about just what this proposed PA Severance Tax could mean.
Severance Tax=Recipe for Disaster Locals see 20-30% decrease in business, officials worry about pushing business away http://www.alleghenyfront.org/story/pushing-new-drilling-tax-when-gas-prices-are-low …George Stark @starkgeorge · Mar 2
A severance tax would set back PA. Read how & why. #natgas#taxeshttp://www.post-gazette.com/opinion/2015/02/27/A-severance-tax-on-the-natural-gas-industry-would-set-back-Pennsylvania/stories/201502260015 …George Stark @starkgeorge · 7h7 hours ago