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House Passes Deep Well Tax Break
   posted 12:39 am Fri May 23, 2008 - Oklahoma City
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Governor Brad Henry (web|news) 's desk is the next stop for legislation that extends a tax break to oil and gas producers that drill deep wells.

The House voted 81-to-13 for the measure, which continues a tax incentive granted by the Legislature in 2005 for another three years, until July 1st, 2011. The bill, already passed in the Senate, provides a tax holiday on the payment of state gross production taxes on oil and gas for wells deeper than 15,000 feet.

The proposal was originally requested by Oklahoma City-based Chesapeake Energy Corporation, the second-largest independent natural gas producer in the United States.

Supporters say it's similar to tax breaks in Texas and Louisiana and provides an incentive for producers to explore for natural gas in the state.

Opponents say Oklahoma has 9 percent of the nation's natural gas reserves and that exploration companies will drill in the state with or without a tax break.

Officials say an average deep-well rig employs 100 people and the average salary of an oil field worker is about $20 an hour.

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