The House is expected to hear legislation Thursday that would give incentives to oil and gas drilling projects with a true vertical depth of 15,000 feet or more. A coalition of business and industry groups are backing House Bill 683 as way to reduce dependence on foreign resources, create new jobs and, in the long run, generate billions of dollars in new revenue for Louisiana. The legislation, authored by Rep. Nickie Monica, R-LaPlace, would create a special break on the royalty payments that companies send to the state based on the property taxes they pay to parish governments for their deep drilling projects. If ultimately adopted, the law would take effect July 1.
While the state won’t have to spend any money to get the program moving and parishes would probably see an increase in property taxes on the local level, the state would suffer a loss of royalty revenues, based on an estimate by the Department of Natural Resources. According to a review by the Legislative Fiscal Office, that loss could amount to $12 million over the next five years.
That reduction, however, would be offset by the new drilling that takes place, argues the Renewed Energy Economy for Louisiana, an economic development coalition that’s pushing the energy package. For the full version of this story, click here.—Jeremy Alford
