George Kaiser of Kaiser-Francis Oil Co. wants Oklahoma to raise taxes on oil companies, the Wall Street Journal said Monday.
Breaking from most of his competitors, Kaiser said higher taxes on oil and gas production “could help the state pay for education and much needed infrastructure improvements.”
He said raising the production tax “doesn’t move the needle in the decision to drill.”
Other energy companies and business groups are arguing that lower tax rates for Oklahoma oil and gas wells are needed to stimulate drilling.
But Continental Resources, Devon Energy, and Chesapeake Energy want to replace an expiring low tax rate with a slightly higher one.
Kaiser, a Democrat in mostly Republican Oklahoma, is worth $10 billion, according to Forbes.
“Energy companies in Oklahoma currently pay a 7% tax on oil and gas revenue. But to encourage drilling with more costly shale wells, which burrow down and then turn horizontally, the tax rate is 1% for the first four years,” the WSJ said.
Continental, Devon and Chesapeake propose a permanent 2% tax rate for the first four years of oil and gas production from all new wells, whether vertical or horizontal, the report said.
Kaiser wants the rate for new wells to be 7% but said “a reasonable compromise would be 3.5% for the first two years of a well’s life.”
North Dakota taxes 11.5% of the value of crude pumped from its fields, the report said.
Pennsylvania imposes a fee on wells that works out to an effective 1.6% tax rate for natural gas, and levies no other production tax.