HB0243 • 2020

Oil and gas tax-new production.

AN ACT relating to mine product taxes; providing an exemption for production of crude oil and natural gas in specified price environments and for specified periods; providing limitations on the exemption; and providing for an effective date.

Energy Land Taxes

Enacted

This bill passed the Legislature and reached final enactment based on the latest official action.

Sponsor: Representative Burkhart
Last action: 2020-03-26
Official status: enrolled
Effective date: 7/1/2020

Plain English Breakdown

The official bill text does not specify a 6% base tax rate or mention a 5% tax rate for subsequent periods. The summary provided in the candidate explanation was overly specific and included details that were not supported by the official source material.

Oil and Gas Tax Exemption for New Production

This law provides a tax exemption for new oil and gas wells drilled between July 2020 and December 2025, based on specific price conditions.

What This Bill Does

Provides an exemption from the severance tax rate of two percent (2%) for new oil and natural gas wells drilled after July 1, 2020, and before December 31, 2025.
The exemption applies to the first six months of production at a reduced rate of four percent (4%), followed by one percent (1%) for the next six months if specific price conditions are met.

Who It Names or Affects

Oil and gas companies drilling new wells in Wyoming between July 1, 2020, and December 31, 2025.
The state of Wyoming's revenue from oil and gas taxes.

Terms To Know

Severance tax: A tax on the removal or extraction of natural resources like oil and gas.
Henry Hub spot price: The market price for natural gas at a specific trading point in Louisiana, used as an indicator for U.S. natural gas prices.

Limits and Unknowns

The tax exemption only applies to new wells drilled between July 1, 2020, and December 31, 2025.
Oil and gas companies must meet specific price conditions for the exemption to apply.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HB0243H3001

3rd reading • Representative Burkhart

Adopted

Plain English: The amendment modifies the bill to specify periods and price environments for tax exemptions on crude oil and natural gas production, adjusts distribution of additional taxes, and removes certain sunset provisions.

Adds language specifying periods and price environments for tax exemptions on crude oil and natural gas production.
Modifies the distribution of additional taxes under W.S. 39-14-211(a).
Removes references to a specific sunset date.

The amendment text does not provide details about the exact price environments or periods, which limits understanding without further context.
Some technical changes in distribution rules may be complex for non-experts to fully understand.

HB0243JC001

Conference Committee

H Failed

Plain English: The amendment changes the duration of an exemption from a tax on crude oil and natural gas production.

Changes the period during which new oil and gas wells can be exempted from taxes from six years to twelve years.

The exact details about what specific exemptions are being modified or how this change affects overall tax revenue are not provided in the amendment text.

HB0243JC002

Conference Committee

H Adopted, S Adopted

Plain English: The amendment removes certain sections and language from the bill that relates to oil and gas tax exemptions.

Removes specific lines and phrases related to the distribution of additional taxes and creating new subsections in the bill text.
Deletes entire paragraphs on pages 2, 3, and 6 which contain details about the tax exemption conditions.

The exact impact of these deletions is not fully explained by the amendment text alone.
It's unclear what specific sections or language are being removed without seeing the original bill content.

HB0243HS001

Standing Committee • House Appropriations Committee

Adopted

Plain English: The amendment to HB0243 removes certain time periods and dollar amounts related to oil and gas tax exemptions.

Removes the phrase '(90) day lookback period' from two places in the bill.
Changes the amount from eighty dollars ($80.00) to seventy dollars ($70.00).
Changes the amount from sixty dollars ($60.00) to fifty-five dollars ($55.00).

The amendment text does not explain what these changes mean in practical terms or how they will affect oil and gas tax exemptions.

HB0243S2001

2nd reading • Senator Bebout

Adopted

Plain English: The amendment changes the number of years from six to twelve for certain provisions related to oil and gas tax exemptions.

Changes 'six (6)' to 'twelve (12)' in two places on page 4 of the bill.

The amendment does not provide context about what specific provisions are being modified, so it is unclear exactly which parts of the oil and gas tax exemptions are affected by this change.

HB0243SW001

Committee of the Whole • Senator Anderson

Failed

Plain English: The amendment removes certain sections and lines from the bill related to oil and gas tax exemptions, altering how the bill's text is structured.

Removes specific lines and phrases that mention providing an exemption for crude oil and natural gas production under certain conditions.
Deletes references to subsection (b) of a section in the bill.
Modifies the structure by deleting entire sections and replacing them with new language about creating new subsections.

The amendment text does not provide clear details on what specific exemptions or conditions are being removed, making it hard to understand exactly how oil and gas producers will be affected.
Without the full context of the bill's original content, it is difficult to explain the exact impact of these deletions.

Bill History

2020-03-26 LSO
Assigned Chapter Number 155
2020-03-26 Governor
Governor Signed HEA No. 0097
2020-03-12 Senate
S President Signed HEA No. 0097
2020-03-12 House
H Speaker Signed HEA No. 0097
2020-03-12 LSO
Assigned Number HEA No. 0097
2020-03-12 Senate
Pursuant to JR 2-1(c):S Appointed JCC02 Members
2020-03-12 House
Pursuant to JR 2-1(c): H Appointed JCC02 Members
2020-03-12 Senate
S Appointed JCC01 Members
2020-03-11 House
H Appointed JCC01 Members
2020-03-11 House
H Concur:Failed 15-44-1-0-0
2020-03-11 House
H Received for Concurrence
2020-03-10 Senate
S 3rd Reading:Passed 21-8-1-0-0
2020-03-09 Senate
S 2nd Reading:Passed
2020-03-06 Senate
S COW:Passed
2020-03-05 Senate
S Placed on General File
2020-03-05 Senate
S09 - Minerals:Recommend Do Pass 3-1-1-0-0
2020-03-02 Senate
S Introduced and Referred to S09 - Minerals
2020-03-02 Senate
S Received for Introduction
2020-02-28 House
H 3rd Reading:Passed 40-17-3-0-0
2020-02-27 House
H 3rd Reading:Laid Back
2020-02-26 House
H 2nd Reading:Passed
2020-02-25 House
H COW:Passed
2020-02-20 House
H Placed on General File
2020-02-20 House
H02 - Appropriations:Recommend Amend and Do Pass 5-2-0-0-0
2020-02-14 House
H Introduced and Referred to H02 - Appropriations 48-9-3-0-0
2020-02-12 House
H Received for Introduction
2020-02-12 LSO
Bill Number Assigned

Official Summary Text

Bill Summary - 20LSO-0585
Bill No.:

HB0243

Effective:

7/1/2020 12:00:00 AM

LSO No.:

20LSO-0585

Enrolled Act No.:

HEA No. 0097

Chapter No.:

155

Prime Sponsor:

Burkhart

Catch Title:

Oil and gas tax-new production.

Subject:

Tax exemption for specified oil and gas production.

Summary/Major Elements:

The current severance tax rate for oil and gas production is 6%.

This act provides that for oil and gas wells drilled after July 1, 2020 and prior to December 31, 2025, the severance tax rate will be four percent (4%) for the first six (6) months of production and five percent (5%) for the next six (6) months of production.

The exemption will not apply to gas production when the twelve (12) month rolling average of the Henry hub spot price for natural gas is two dollars and ninety-five cents ($2.95) or more per thousand cubic feet at the time of first production and will not apply to the production of crude oil when the twelve (12) month rolling average of the West Texas Intermediate spot price of sweet crude oil is fifty dollars ($50.00) or more per barrel at the time of first production.
The above summary is not an official publication of the Wyoming Legislature and is not an official statement of legislative intent. While the Legislative Service Office endeavored to provide accurate information in this summary, it should not be relied upon as a comprehensive abstract of the bill.

Current Bill Text

Read the full stored bill text

20LSO-0585

ORIGINAL House

ENGROSSED
Bill No
.
HB0243

ENROLLED ACT NO. 97,

HOUSE OF REPRESENTATIVES

SIXTY-FIFTH LEGISLATURE OF THE STATE OF WYOMING
2020 Budget Session

AN ACT relating to mine product taxes; providing an exemption for production of crude oil and natural gas in specified price environments and for specified periods; providing limitations on the exemption; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.

W.S. 39
‑
14
‑
204(a)(iv) and 39
‑
14
‑
205 by creating new subsections (n) and (o) are amended to read:

39
‑
14
‑
204.

Tax rate.

(a)

Except as otherwise provided by this section and W.S. 39
‑
14
‑
205, the total severance tax on crude oil, lease condensate or natural gas shall be six percent (6%), comprising one and one
‑
half percent (1.5%) imposed by the Wyoming constitution article 15, section 19 and the remaining amount imposed by Wyoming statute. The tax shall be distributed as provided in W.S. 39
‑
14
‑
211 and is imposed as follows:

(iv)

Two percent (2%)
except as provided in W.S. 39
‑
14
‑
205(n)
.

39
‑
14
‑
205.

Exemptions.

(n)

Crude oil and natural gas production resulting from any well that is drilled on or after July 1, 2020 and prior to December 31, 2025 as certified, by the oil and gas conservation commission, is exempt from the severance taxes imposed by W.S. 39
‑
14
‑
204(a)(iv) as provided in this subsection. Subject to subsection (o) of this section, the exemption under this subsection shall not apply to natural
gas production when the twelve (12) month rolling average of the Henry hub spot price for natural gas is two dollars and ninety
‑
five cents ($2.95) or more per thousand cubic feet at the time of first production from the well and shall not apply to the production of crude oil when the twelve (12) month rolling average of the West Texas Intermediate (WTI) spot price of sweet crude oil is fifty dollars ($50.00) or more per barrel at the time of first production from the well. If the exemption under this subsection is applicable to a new well based upon the oil or gas price at the time of first production, the exemption shall be an exemption of the full two percent (2%) tax rate under W.S. 39
‑
14
‑
204(a)(iv) for the first six (6) months of production and shall reduce the rate under W.S. 39
‑
14
‑
204(a)(iv) to one percent (1%) for the next six (6) months of production.

(o)

In determining the exemption under subsection (n) of this section, the department shall use the twelve (12) month rolling average based on the monthly average of daily spot prices for West Texas Intermediate (WTI) per barrel of oil and the monthly average of daily spot prices for Henry hub per thousand cubic feet of natural gas for the twelve (12) month period immediately preceding first production from the well. The department shall post the most recent monthly average and the twelve (12) month rolling average for the calculated prices on its website. Not later than November 1 of each year, the department shall report to the joint revenue interim committee on the use of the exemptions under subsection (n) of this section, and associated revenue impacts.

Section 2.

This act is effective July 1, 2020.

(END)

Speaker of the House

President of the Senate

Governor

TIME APPROVED: _________

DATE APPROVED: _________

I hereby certify that this act originated in the House.

Chief Clerk

1