American Oil and Gas Reporter - June 2020 - 49

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SpecialReport: Water Management
TABLE 2
Texas State and Local Taxes and Public Royalties Paid
Statewide Producers and Permian Producers, Millions of Dollars
Revenue Source

2014

2015

2016

2017

2018

2019

$11,576.2

$9,972.1

$7,266.2

$6,990.6

$9,830.1

$11,303.3

$1,748.9

$1,400.5

$1,018.3

$1,605.3

$1,944.5

$2,112.7

$13,325.1

$11,372.6

$8,284.5

$8,595.9

$11,774.6

$13,416.0

Taxes

$4,910.1

$4,235.7

$3,572.1

$3,796.2

$5,803.3

$6,991.7

Royalties

$1,479.9

$1,207.7

$910.3

$1,410.3

$1,800.2

$1,971.4

Total Taxes & Royalties

$6,390.1

$5,443.4

$4,482.4

$5,206.6

$7,603.5

$8,963.2

Taxes

42.4%

42.5%

49.2%

54.3%

59.0%

61.9%

Royalties

84.6%

86.2%

89.4%

87.9%

92.6%

93.3%

Total Taxes & Royalties

48.0%

47.9%

54.1%

60.6%

64.6%

66.8%

Texas Statewide
Taxes
Royalties
Total Taxes & Royalties
Permian Basin

Permian as Percent of State

Note: Numbers may not add due to rounding.
Source: Calculated by the Texas Taxpayers and Research Association.

directly contributed a record $13.4 billion
to the state treasury in the form of taxes
and royalties-just topping the 2014 record
of $13.3 billion," "Enriching Texas"
details. "Though the numbers are similar,
the components were substantially different. The record in 2014 was largely
price driven, while 2019's record was
production driven," the report notes, observing that crude prices dropped 40%
from 2014 to 2019, while Permian production climbed 67%.
$312 Per Texan
Moreover, the analysis adds, in 2014,
$6.4 billion, or 48% of that industrybased revenue, originated from the Permian; whereas in 2019, the Permian Basin
accounted for $9.0 billion, or 67%, of
Texas oil and gas taxes and royalties
(Table 2), a sum equal to $312 for every
Texan.
"Absent this revenue, the average
Texan would either have had to accept a
lower amount of services from state and
local governments or would have had to
pay that much more in taxes," the report
notes. "This 'Permian Dividend' may be
heavily discounted in 2020. However,
even though the industry may be at a
pause, it is still at the forefront of the solution to the state's fiscal challenges. Oil
and gas has been the chief source of revenue flowing into Texas' very robust Economic Stabilization, or 'Rainy Day Fund,'

and is likely to save Texans from either
difficult budget cuts or higher taxes."
Among the figures the study sites to
illustrate the Permian's increasingly prominent place in the Lone Star State's industry
and economy is that one in five of the
United States' major producing fields are
found within the Permian, and that the
basin accounts for a quarter of U.S.
proved crude oil reserves.
Meanwhile, thanks to the state's substantial land and mineral holdings in the
Permian, the report notes output from
the basin has funneled considerable sums
into Texas public and higher education,
with 2019 figures showing Texas collecting
93%-$2.0 billion of $2.1 billion-in mineral

royalties from the Permian Basin. Those
monies, it points out, are dedicated to
Texas' Permanent University Fund and
the Permanent School Fund.
The report acknowledges 2020 market
dynamics-such as the Russian-Saudi
crude oil price war and transportation
fuel freefalls associated with the coronavirus pandemic-have affected both petroleum supply and demand to oil and
gas companies' detriment, but it also
points to a lesson of history for context.
"Texas is long used to dramatic swings
in the oil and gas industry," the study
says. "For all the obituaries written over
the years, not one has ever proven true."
❒

Basic Energy Acquires C&J Well Services Assets
FORT WORTH-Basic Energy Services
Inc. has acquired the production operations
from NexTier known as C&J Well Services
for $94 million.
C&J Well Services was established in
San Angelo, Tx., in 1948 by Frank Pool.
It is the third-largest rig servicing provider
in the United States.
The transaction will increase Basic
Energy's workover fleet to 411 highspecification rigs, and push its workforce
to nearly 5,000 employees across 11
states, the company says.
"This transaction solidifies Basic's
foundation to become the leading and

most trusted production services provider
in the country. Starting with the nearcomplete sale of our pumping services
assets, we have taken important steps to
bolster our core production-focused businesses, enhance our credit profile and ultimately position the company for future
growth and leadership," assesses Keith
L. Schilling, Basic's president and chief
executive officer.
Jack Renshaw, current senior vice president of C&J Well Services, will join Basic
to lead the newly formed western region,
consisting of all California and Rocky
Mountain operations, Basic says.
❒
JUNE 2020 49



American Oil and Gas Reporter - June 2020

Table of Contents for the Digital Edition of American Oil and Gas Reporter - June 2020

Contents
American Oil and Gas Reporter - June 2020 - Intro
American Oil and Gas Reporter - June 2020 - 1
American Oil and Gas Reporter - June 2020 - 2
American Oil and Gas Reporter - June 2020 - Contents
American Oil and Gas Reporter - June 2020 - 4
American Oil and Gas Reporter - June 2020 - 5
American Oil and Gas Reporter - June 2020 - 6
American Oil and Gas Reporter - June 2020 - 7
American Oil and Gas Reporter - June 2020 - 8
American Oil and Gas Reporter - June 2020 - 9
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