State of Miss. provides help for TMS
From EnCana's earning report. Unfortunately no Ash well info. Also the below info guarantees that no well in the Mississippi TMS will be completed before July 1, 2013
In April, the State of Mississippi approved a severance tax reduction that reduces the tax rate from 6.0 percent to 1.3 percent on new horizontal wells commencing production on or after July 1, 2013 for the first 30 months of production of a well. This five-year program supports the pursuit of commerciality by positively impacting Encana's economics for the emerging Tuscaloosa Marine Shale (TMS) play. With six wells producing in the TMS and two additional wells expected to begin production in the second quarter of 2013, the company is gaining confidence in the potential of the play as it nears commerciality.
I posted this in the wrong forum the first time.
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Replies to This Discussion
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Permalink Reply by Bernell McGehee on
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I just came to the same conclusion and posted it on another discussion.
The two Ash wells will not likely begin production until July1 and the two new Anderson 17 wells, which likely could be produced in late May or early June will also likely wait until July 1 to start.
If the Mississippi legislature had thought just a little harder, they would have made this effective April 1.
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Permalink Reply by onesock73 on -
Did anyone see this coming? Were the oil companies waiting with permits ready to go until this passed?
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It has been reported on in newspapers for several months that the law was under consideration.
I don't think the drilling has been held up pending the passage of this law, but I do believe, now that it has passed, they will hold up producing these few wells that are close to the July 1 date.
Of course, if oil drops by 6% over the next two+ months, Encana will have a little egg on their face, but other than that it seems like waiting for a 5% increase in income is worth the wait.
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