Total Revenue to Drop by Nearly $105 Million for Fees Due on 2023 Wells in Pennsylvania
PUC: 2023 Pennsylvania Drilling Impact Fees to Drop by 25%
By David E. hess | PA Environment Digest | January 26, 2024
The Public Utility Commission published notice in the January 27 PA Bulletin the Calendar Year 2023 Act 13 per well drilling impact fees will drop by 25% for unconventional shale gas wells.
On December 13, the Independent Fiscal Office estimated 2023 Act 13 shale gas drilling fee revenues will drop by $104.8 million to $174 million from last year’s record $278.9 million due primarily from the reduction in the price of natural gas. Read more here.
Shale gas drilling fee revenues will drop by $104.8 million to $174 million in Pennsylvania.
The formula for the Act 13 fee is established in law and is based in part on the price of natural gas and the consumer price index.
The price of natural gas decreased from $6.644 in calendar year 2022 to $2,737, according to the PUC notice.
The consumer price index went down from 6.4 percent in 2022 to 3.9%, also according to the notice.
The number of new unconventional wells drilled also dropped from 576 in 2022 to 423 in 2023.
As a result of these changes,
the calendar year 2023 Act 13 fees will be:
Year of Well | Horizontal | Vertical-Producing
Year 1 $51,800 $10,400
Year 2 $40,200 $8,000
Year 3 $34,500 $6,900
Year 4-10 $17,200 $3,400
Year 11-15 $5,600 N/A
The calendar year 2022 fees were:
Year of Well | Horizontal | Vertical-Producing
Year 1 $69,100 $13,800
Year 2 $63,200 $12,600
Year 3 $57,500 $11,500
Year 4-10 $23,000 $4,600
Year 11-15 $11,600 N/A
Visit the PUC’s Act 13 Impact Fee for more information.
###
Pennsylvania settles for ‘chump change’ compared to other states with a severance tax
Pennsylvania HR 131
HR131 -A Resolution directing the Legislative Budget and Finance Committee to conduct a study to compare impact fees and severance taxes in the largest natural gas producing states and examine the competitive business climate for the industry in those states.
Pennsylvania Budget & Policy Center
June 15, 2009
The Energy Age 