Alaska2026Passed Legislature

SB112

Changes to Alaska Oil and Gas Tax Credits

Last scannedSep 21, 2026, 12:32 AM

In one sentence

This bill lowers the tax credit amount oil producers can claim for each barrel of northern Alaskan oil produced starting January 1, 2025.

Reduces the tax credit from $8 to $5 per barrel for northern oil that does not receive a value reduction at production when prices are under $80.
Sets lower tax credits based on monthly average gross values: $4 if between $80 and $90, $3 if between $90 and $100, down to zero if the price is $150 or higher.
Limits total tax credits a producer can use in one year for a specific lease or property to the amount of qualified capital expenditures spent on that lease or property.
Stops producers from saving unused tax credit amounts to use in future years.
Makes these changes apply retroactively to oil produced starting January 1, 2025.

Oil and gas producers operating leases or properties north of 68 degrees North latitude
The Alaska Department of Revenue

The bill does not specify the exact effective date for when it becomes official beyond stating it takes effect immediately.
Producers cannot carry forward unused credits if they do not spend enough on capital improvements to match their credit amount.
Interest and penalties are waived only until January 1, 2026, after which producers must pay any remaining tax balance.

Plain language

Tax credit: An amount that reduces the total tax a producer must pay to the state.
Gross value at point of production: The price or worth of oil when it is first taken out of the ground before any adjustments.
Qualified capital expenditure: Money spent by a producer on long-term improvements to their lease or property, as defined in state law.

Official record

Validated

OIL & GAS PRODUCTION TAX An Act relating to credits against the oil and gas production tax; and providing for an effective date.

Official activity