Higher taxes have little impact on drilling, George Kaiser says

Tulsa oilman George Kaiser says the state’s gross production tax should return to 7 percent, challenging a plan proposed by fellow oil company executives who want to see the rate settle at 2 percent for the first four years of production.
by Adam Wilmoth Modified: May 5, 2014 at 10:00 am •  Published: May 4, 2014

Tulsa oilman George Kaiser wants his industry to pay more taxes.

The owner of Tulsa-based Kaiser-Francis Oil Co. is asking legislators to return the state’s gross production tax to 7 percent, challenging a plan proposed by fellow oil company executives who want to see the rate settle at 2 percent for the first four years of production.

“We are making an impassioned appeal to raise our own taxes,” Kaiser said.

Executives from Devon Energy Corp., Continental Resources Inc. and Chesapeake Energy Corp. told The Oklahoman last week that higher gross production tax rates would make many planned Oklahoma wells unable to compete with potential drilling locations in other areas.

Kaiser, however, said tax rates have little influence on whether wells are drilled in a state.

“In addition to the fact that I think it has desperate consequences to the state, which is already suffering an inability to fund state services, I am absolutely confident that the rate of gross production or ad valorem in a state within a reasonable range of 0 to 12 percent has no bearing whatsoever in the economic activity in a state,” Kaiser said.

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by Adam Wilmoth
Energy Editor
Adam Wilmoth returned to The Oklahoman as energy editor in 2012 after working for four years in public relations. He previously spent seven years as a business reporter at The Oklahoman, including five years covering the state's energy sector....
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