Texas tax receipts from oil and gas hit $15.7 billion in 2014

Fuel Fix:

Oil and gas producers paid a record $15.7 billion in state and local taxes and royalties last year, according to an industry analysis released Tuesday.

The figures come at a time when the energy sector is dramatically slowing its activity in Texas amid falling oil prices, prompting some concern about whether public entities that have grown accustomed to oil money could feel the pinch as production slows.

Officials at the Texas Oil & Gas Association said the state and localities would still receive vast sums of money from the oil industry this year, even if activity slows, but acknowledged that the industry’s taxes and royalty payments to governments would likely fall in 2015.

“I think that the lower prices should certainly make legislators cautious in their approach to budgeting,” said Todd Staples, the association’s president and former Texas Agriculture Commissioner.

Staples said that when daily oil production was 1 million barrels per day in 2012, the industry paid $12.1 billion in state and local taxes and royalties.

And in 2009, when the price of oil was around $60 per barrel and oil production was at a third of current levels, the industry paid $8.5 billion — nearly half as much as it did during the record year in 2014.
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Putting most of that money in the Rainy Day Fund seems prudent since unless something changes there will be less revenue in the coming years.  Some could be spent on infrastructure projects that don't require a continuing cash flow commitment.