Legislature(2009 - 2010)SENATE FINANCE 532
01/26/2010 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Presentation: Department of Revenue Oil Production & Revenue Forecast; State Revenue Forecast - Fy 2011 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
SENATE FINANCE COMMITTEE
January 26, 2010
9:03 a.m.
9:03:52 AM
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee
meeting to order at 9:03 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Charlie Huggins, Vice-Chair
Senator Johnny Ellis
Senator Dennis Egan
Senator Donny Olson
Senator Joe Thomas
MEMBERS ABSENT
None
ALSO PRESENT
Pat Galvin, Commissioner, Department of Revenue; Dan
Stickel, Economist, Tax Division, Department of Revenue
PRESENT VIA TELECONFERENCE
Dona Keppers, Audit Master, Tax Division, Department of
Revenue; Frank Molli, Production Forecasting Consultant,
Department of Revenue; Cheryl L. Nienhuis, Acting Chief
Economist, Department of Revenue
SUMMARY
^PRESENTATION: DEPARTMENT OF REVENUE OIL PRODUCTION &
REVENUE FORECAST; STATE REVENUE FORECAST - FY 2011
9:04:10 AM
Co-Chair Stedman made introductory comments. He introduced
Senator Dennis Egan, who is new to the Senate Finance
Committee, as well as members of the secretarial staff.
9:11:01 AM
Co-Chair Stedman shared protocols for conducting Senate
Finance meetings.
9:16:25 AM
Co-Chair Stedman encouraged members to review the Revenue
Sources Book.
9:16:56 AM
PAT GALVIN, COMMISSIONER, DEPARTMENT OF REVENUE, introduced
the presenters from the Department of Revenue (DOR). He
referenced a handout entitled, "Overview of Fall 2009
Revenue Forecast", which accompanied his presentation. He
began by sharing the outline of the presentation, as shown
on slide 2.
Co-Chair Stedman pointed out that the presentation has been
updated since it was presented to the House Finance
Committee.
Commissioner Galvin shared that how the production tax is
calculated will be contained in the presentation. Also
included will be information about forecasts for oil
production, oil price, and lease expenditures.
Commissioner Galvin turned to the "Fall 2009 Revenue
Forecast - FY 10 and FY 11 Total Revenue". He explained
that the primary distinction DOR makes is between
unrestricted and restricted revenue - slide 4. Restricted
revenue are those funds that are generally set aside by
constitutional requirement or by general practice within
the legislature and are not part of the general fund.
General fund is referred to as unrestricted revenue and is
broken down into oil revenue, other revenue, and investment
earnings.
Commissioner Galvin reported that the Department of Revenue
is projecting an increase in unrestricted revenue between
FY 10 and FY 11. The total revenue will also increase
between the two years.
9:22:23 AM
Commissioner Galvin turned to slide 5 to discuss general
fund unrestricted revenue and the breakdown between oil
revenue and non-oil revenue. Oil revenue continues to
dominate the unrestricted revenue, making up between 87 and
88 percent of the total. He pointed out that the production
tax is the dominant portion of the oil revenue, whereas
royalties used to dominate.
Co-Chair Stedman noted that the subtotal for oil revenue
would be $4,647.7 billion in FY 11. Non-oil revenue will
total $589 million. He stressed the importance of the
difference in magnitude of the two numbers. He commented
that a reduction in non-oil revenue of 20 percent would not
be significant; however, a reduction by 20 percent in oil
revenue would be a challenge.
9:23:50 AM
Co-Chair Hoffman questioned the reason behind oil revenues
increasing by about a billion dollars. Commissioner Galvin
explained that it was as a result of higher oil prices. A
decline in production is predicted between FY 10 and FY 11.
Commissioner Galvin turned to non-oil revenue detail on
slide 6. The corporate income tax is tax from non-oil based
companies such as mining and fishing.
Co-Chair Stedman wondered which month brought in the
highest amount from oil revenue. Commissioner Galvin
reported that in FY 09 the largest monthly amount was
almost a billion dollars. For comparison, Co-Chair Stedman
inquired what that amount was last month. Commissioner
Galvin thought it was roughly $300 million. Co-Chair
Stedman stated that monthly revenue from oil currently
equals what will be earned in one year from non-oil revenue
taxes. Commissioner Galvin said that was correct.
9:26:12 AM
Senator Olson asked why the revenue from mining taxes is
projected to decrease by a million dollars. Commissioner
Galvin deferred to Mr. Stickel to answer.
9:26:47 AM
DAN STICKEL, ECONOMIST, TAX DIVISION, DEPARTMENT OF
REVENUE, thought the tax decline in FY 11 was a result of
lower mineral price projection.
Commissioner Galvin directed attention to the ten-year
revenue/spending projection as depicted on slide 8. The
information is a comparison of current revenue projections
and an extrapolation of current spending at a very modest
level of increase on an annual basis. It is a 3 percent
budget escalation from FY 11 forward. He concluded that at
the end of the projection period, the balance in the
Constitutional Budget Reserve (CBR) would be almost $24
billion.
Co-Chair Stedman requested an explanation of the CBR.
Commissioner Galvin described the CBR as a fund set up by
the state constitution to designate funds to be used for
future budgetary purposes. It was designed to hold surplus
dollars until they were needed. Accessing the CBR requires
a three-quarters vote by the legislature and it is intended
to be used to smooth the state's fiscal picture. Co-Chair
Stedman noted that the CBR is the state's savings account.
The PFD account is not used to finance shortfalls, but the
budget reserve accounts are - the statutory budget reserve
and the constitutional budget reserve. Commissioner Galvin
agreed.
Co-Chair Stedman observed that the total reserve balances
would be $10 billion by the end of FY 10. Commissioner
Galvin agreed.
9:30:36 AM
Co-Chair Stedman questioned if the total reserve balances
would be $20 billion in 2017. Commissioner Galvin said that
was correct given the assumptions that went into the
projection model.
Co-Chair Hoffman asked if Commissioner Galvin anticipated
any draws from the CBR through FY 20. Commissioner Galvin
reported that, given the very modest spending increases,
draws would not be needed.
Co-Chair Stedman pointed out the projected 3 percent budget
escalation. He recalled previous zero percent projections.
Currently, the formula-driven side of the operating account
is substantially higher than 3 percent, while the portion
of the operating budget the legislature manages is lower.
The sum of the two is projected to be 5.8 percent,
resulting in the need to substantially lower the
legislature's portion. He predicted challenges ahead.
Senator Olson questioned the numbers in the FY 11 revenue
vs. spending column. He thought the total should be $4,094
million, rather than $94 million. Commissioner Galvin
referred to a footnote which explained that $400 million
was set aside for the governor's scholarship program.
9:33:59 AM
Co-Chair Stedman emphasized that the scenarios were
hypothetical forecasts at 3 percent, which accounts for
inflation. Commissioner Galvin agreed that the model, a
reflection of a scenario that was unlikely to occur for a
variety of reasons, was used in order to show revenue and
spending projections.
Co-Chair Stedman requested capital budget projections.
Commissioner Galvin explained that the capital assumptions
were extremely modest, using last year's historically low
capital budget and extrapolating it forward. Co-Chair
Stedman recalled the Senate Finance Committee's
extraordinary actions last year in reducing capital outlays
due to the implosion in financial markets and the decline
in oil prices.
9:35:32 AM
Commissioner Galvin explained how FY 09 production tax was
calculated - slide 10. The intent of this calculation is to
show the component parts of the production tax and how they
relate to each other and how the total was derived. Not
included in the production tax calculations are royalty and
federal barrels. Royalty barrels are those owned by the
state as part of the lease contract. Federal barrels are
those that are offshore.
Co-Chair Stedman stated that the first thing "off the top"
is 12.5 percent for royalties. Commissioner Galvin agreed.
He explained that a quarter of that amount goes into the
permanent fund, and the remainder goes into unrestricted
revenue. Co-Chair Stedman stressed the importance of that
order.
9:38:38 AM
Commissioner Galvin directed attention to the taxable
barrels worth $15 billion, after the royalty and federal
barrels are subtracted out. That amount constitutes the
value of the oil at its ultimate market - the refinery. In
order to determine taxable value, deductions have to be
made, such as downstream transportation costs. Those are
costs incurred to get the product to market downstream of
the production point. The marine transport costs, TAPS
tariff, and other costs are deductible. This results in a
"truing up" of the value of the oil. The $6.50 is the
transportation cost deduction, which amounts to about $4
billion total. He defined "the value at the point of
production" as the taxable barrels minus the total
transportation costs.
9:42:01 AM
Commissioner Galvin explained deductible upstream costs as
deductions associated with the cost of producing the oil.
Those are broken into operating and capital expenditures.
Generally, operating costs are day-to-day expenses, whereas
capital costs involve buying new equipment or drilling new
wells.
Co-Chair Stedman asked for more information on deductible
operating expenditures, such as net and gross barrels and
how they relate to royalty. Commissioner Galvin explained
that in slide 10, the $2 billion figure is the total
operating expenditures figure which was deducted for oil
that resulted in property tax. That was divided by 218
million taxable barrels. The operating costs include the
cost of producing royalty barrels and are deductible. For
purposes of the slide, the amount was divided by the
taxable barrels to provide a per barrel cost. The number
$9.39 may not be the same if a company was showing its
operating costs, because operating costs would be spread
among all barrels, including royalty barrels.
Co-Chair Stedman noted the importance of taking into
consideration the standardization of per-barrel costs for
presentation purposes.
9:46:15 AM
Commissioner Galvin reported that the same principle would
apply to capital expenditures. He clarified that the number
on the right-hand side of the slide is the total capital
expenditures for capital costs that were deducted from the
taxes that were paid. The end total for lease expenditures
is $3.8 billion and approximately $17.40 per barrel. The
annual price per barrel, $68.34, is the average across the
entire year, minus transportation costs and the total lease
expenditures, to get at the production tax value of $44.46
per barrel, which equates to $9.7 billion total taxable
value. That value is used as the basis for calculating what
the tax bill is.
Co-Chair Stedman asked if that was called the "total
production cost." Commissioner Galvin agreed that it could
be called that. He pointed out that the term "lease
expenditure" was used to designate what is qualified as
deductible for calculating the production tax. Co-Chair
Stedman hope to standardized terms.
9:48:53 AM
Commissioner Galvin discussed the calculation used for the
production tax. The $9.7 billion production tax value is
multiplied by the base tax rate of 25 percent and the
result is $2.4 billion in base tax. Next, the progressivity
of the tax is figured resulting in the total tax due before
credits, just under $3 billion. Co-Chair Stedman commented
on the calculations. Commissioner Galvin clarified that the
total average tax rate in this model is 30.8 percent. The
last piece allows for the deduction of the credits and
yields a total calculation. In 2009 the total credits
deducted were about $350 million, which results in a total
calculation of $2.6 billion for production tax purposes.
Co-Chair Stedman requested an explanation of the credit. He
noted that the model was very stripped down. Commissioner
Galvin cleared up a misconception about capital credits. He
stated that capital credits that are designated through
this line item are predominantly "023 credits", a reference
to the tax code. They result in 20 percent credit and are
divided into two calendar years. In addition, companies may
earn credits under "025" or the "exploration incentive
credit program", which are either 30 percent or 40 percent
of capital expenditures, depending on location and drilling
and seismic costs.
9:54:15 AM
Co-Chair Stedman commented that the previous information
references tax codes, which change from year to year.
Commissioner Galvin explained about exclusions regarding
costs of general maintenance.
Commissioner Galvin related that credits purchased by a
taxpayer are also included in credits applied against
taxes. He gave an example of how that works. He noted that
credits can also be transferred.
9:57:07 AM
Senator Huggins asked for Commissioner Galvin's opinion as
to how the production tax is working. Commissioner Galvin
explained that the department is not privy to actual
negotiations, but has heard a preference from companies
that earn the credits for a cash-payment system, rather
than going to an existing taxpayer, where there is a value
loss and a time delay when converting credit into cash.
Senator Huggins asked if this was a part of the governor's
modified Alaska's Clear and Equitable Share (ACES)
proposal. Commissioner Galvin said it was. A couple
components would eliminate several barriers regarding
explorers being able to get cash from the state for
credits.
Co-Chair Stedman requested an explanation of how the 20
percent capital credit mechanism works. Commissioner Galvin
explained that a current producer would deduct it off the
top. The slide shows credits applied against taxes. The
majority of producers would deduct it from their tax bill
and the state would not receive any money. Others will have
to apply to the state for a credit certificate because they
do not owe production tax. The certificate allows the
producer to sell credits to an existing producer or to be
reimbursed by the state.
Co-Chair Stedman noted the importance of the 20 percent
capital credit to large production companies like Exxon,
BP, and ConocoPhillips and to the state. It is difficult
for the state to see in the summary documents whether the
capital deduction has been taken or not. Capital credit is
the credit that impacts the state's cash flow. Smaller
companies that do not have positive cash flow consume the
credits themselves. There is need for clarification
regarding where the capital credit is being generated and
its impact on TAPS. Capital credit has a huge impact on
forecasting models.
Commissioner Galvin agreed that it was an important point.
The $350 million in credits applied against taxes is
usually lost in the revenue projection. It is usually taken
off because of credits earned. An amount for $193 million
would also be seen for credits for which the state paid
cash, but which had to be paid through an appropriation.
There was a total of $540 million in credits that reduced
the state's revenue.
10:03:40 AM
Commissioner Galvin summarized that the total annual
production tax, after credits, was $2.6 billion. The actual
amount of production tax collected in FY 09 was $3.1
billion. He clarified that this happened because the
department calculates production tax on a monthly basis,
not on an annual basis. The monthly oil price volatility
matters - slides 12 and 13. The average price of oil in
July was $132.87; in December it was $37.70. The
progressive tax rate comes into play each month.
Co-Chair Stedman commented that such a large swing in oil
prices was not considered during the discussions about
progressivity under PPT and ACES. He hoped the extreme
volatility was an aberration in time. Commissioner Galvin
said the numbers also reflect the way in which the tax
system responds to oil prices.
10:08:14 AM
Senator Huggins asked about the total government take,
including federal take and royalties, in July versus
January. Commissioner Galvin guessed that in a "$37 world"
it would be around 60 percent. At $132 it is closer to over
80 percent. Senator Huggins stressed the importance of
recognizing the large swing in prices. Co-Chair Stedman
offered to provide a history of government take
calculations. Commissioner Galvin emphasized that the
government take for FY 09 would be significantly different
if a yearly average of $68 per barrel were done.
10:10:27 AM
Co-Chair Stedman requested a definition of "government
take". Commissioner Galvin defined it as a number used to
reflect the net value distributed between the government
and the company. It reflects the percent of the profit that
is acquired by the state or federal government. It can be
used as a comparison between different jurisdictions.
Commissioner Galvin discussed the chart on slide 14, which
reflects the production tax projected for FY 10. He
described the adjustment to reflect monthly differentials.
The information contains actual assumptions and
projections.
10:13:23 AM
Commissioner Galvin detailed slide 15, production tax
projections for FY 11 using quarterly oil price
projections.
Co-Chair Stedman requested information about the capital
credits in the various projections. Commissioner Galvin
responded that the progression between FY 09, FY 10, and FY
11 shows an increasing level of credits applied against the
taxes. That reflects an increase in spending.
10:15:04 AM
Senator Huggins asked about the "carry forward" from the
previous year as it applies to capital deductions.
Commissioner Galvin responded that the impact of projected
increasing levels of spending is lagged by the capital
credits being taken over two years.
Senator Huggins expressed concern regarding the capital
piece's accuracy, if it was looked at separately.
Commissioner Galvin explained that the impact of the
expenditure is delayed, although the capital expenditures
projection is reflected in the actual expenditures of the
appropriate year. During the reporting process for lease
expenditures there is no lag.
10:17:35 AM
Co-Chair Stedman commented on the need to examine the
capital credit issue further in the future. He asked about
the "less adjustment" line on slide 15, which did not
appear in FY 09. Commissioner Galvin responded that it was
the reflection of the difference between an annualized
calculation and the monthly variations. In order to
reconcile the two for the actual revenue forecast, an
adjustment has to be made.
Senator Egan inquired about the reason for the increase in
capital expenditures between FY 09 and FY 11. Commissioner
Galvin responded that capital expenditures, including new
development projects, seismic programs, and capital
replacements are increasing. There has been discussion
about the amount of maintenance dollars expended; however,
the department has not seen an increase in spending
projections as a result of higher maintenance costs.
10:20:31 AM
Commissioner Galvin observed that the model is an amalgam
of all the companies. Each individual taxpayer is affected
differently due to various levels of costs and
progressivity. As a company ramps into production, there is
a period of time when the credits eliminate the tax
obligations as a function of oil prices. He explained that
it was a multiple variable tax structure.
10:24:15 AM
Senator Huggins wondered when Exxon was planning to go from
explorer to producer at Point Thomson. Commissioner Galvin
stated that in 2014 Exxon would begin to move toward
production of liquids.
Senator Huggins asked what liquids includes. Commissioner
Galvin defined it as "barrels of oil".
Senator Thomas voiced concern about the impact to the
state's revenue due to oil spills and the need to shut the
pipeline down. Commissioner Galvin replied that, under
ACES, maintenance costs that are associated with
interrupted service cannot be deducted. That provision is
being examined; however, it is expected to prevail.
Currently, there is a lawsuit regarding the impact of lost
production from a shutdown.
10:27:18 AM
Commissioner Galvin discussed the components of production
tax calculations and price forecasting. He introduced the
specialists available for the presentation.
FRANK MOLLI, PRODUCTION FORECASTING CONSULTANT, DEPARTMENT
OF REVENUE, testified via teleconference. He characterized
the graph as showing North Slope production by field from
1978 through 2030. It shows both historical and forecast
data. To generate the forecast, production data was
gathered from each well from the Alaska Oil and Gas
Conservation Commission (AOGCC) and then a trend analysis
on the recent history for each well was applied in order to
generate a per-well forecast. Then, a discussion with the
operators about development plans for future wells was
considered, along with public and private information.
10:31:56 AM
Mr. Molli described the FY 09 fall forecast as more
conservative than previous forecasts. There were several
areas not included in this forecast such as ANWAR, NPRA,
and some heavy oil deposits. Also not included was a recent
public statement by Renaissance Alaska, LLC, about the
Umiat Field with about 1 billion barrels of oil in place
and a probable recovery of about 200 million barrels.
Mr. Molli described slide 19 - forecasted ANS production FY
10 - FY 30. He explained that the gray portion is oil from
currently-producing wells. The department's confidence in
the forecast is high, within plus or minus 3 percent of the
actual numbers in the forecast one or two years out. The
rainbow colors show production projected from projects that
are either under development or under evaluation. The
department's confidence in these numbers is not quite as
good - within plus or minus 10-15 percent for the next one
to two years. The years 2022-3 show the projection for
Point Thomson, contingent upon a gas line.
Co-Chair Stedman requested an explanation of the inclusion
of the National Petroleum Reserve - Alaska (NPR-A) in the
forecast. Mr. Molli explained that NPR-A is under
evaluation.
Mr. Molli shared statistics about recent production decline
- slide 20. Since peak production in 1988, there has been a
66 percent decline. The decline rates, on average, have
been around 5 percent. He noted that the near term shows a
4.5-5 percent decline.
Co-Chair Stedman asked if Alaska's production scheme over
the last 20 years was normal. Mr. Molli answered that there
is usually a steep decline at first and then it flattens
out. He concluded that it was a typical oil basin.
Co-Chair Stedman noted that Mr. Molli's information
disproves comments made in the press about dysfunctional
policies in the state leading to a decline in production.
Mr. Molli agreed that the decline in production was typical
of a natural decline in an oil basin.
10:36:35 AM
Mr. Molli stressed that no amount of money could change the
natural decline. Co-Chair Stedman thought that was
important for the legislature to remember when attempting
to slow down the decline.
Senator Huggins requested information on how to attack
production decline.
10:38:19 AM
DONA KEPPERS, AUDIT MASTER, TAX DIVISION, DEPARTMENT OF
REVENUE, testified via teleconference. She reported on
slide 22, an overview of price forecast methodology. The
information came from a recent price forecasting session
attended by numerous experts in the field. Factors that
influence price were studied: supply, demand, world
economy, geopolitics, financial markets, and others. Due to
economic uncertainty, analysts in the session focused on
near-term prices.
Ms. Keppers explained slide 23 - price forecasts as of
October 2009. It is a graph that shows West Texas
Intermediate (WTI) price forecast. She explained that WTI
is known as Texas light sweet crude oil and is used as a
benchmark in oil pricing. The underlying commodity of the
New York Mercantile Exchange (NYMEX) is oil future
contracts. The chart shows forecasts from the Alaska
Department of Revenue (AK - DOR) and Energy Information
Administration (EIA), one of the industry's experts, as
well as from NYMEX and the analysts.
Ms. Keppers turned to slide 24. She reported that for FY 10
and FY 11, the AK-DOR forecast came out at $68.71 and
$78.85, respectively, very similar to predictions by NY-
MEX, EIA, and the analysts.
10:40:35 AM
Commissioner Galvin defined EIA as the federal government's
forecasting group from the Department of Energy. He pointed
out that EIA, the green line, is extremely bullish
regarding expectations of oil prices. He explained that the
red line represents the futures market and involves people
looking to make money; therefore, the forecast is on the
lower end. The blue line is the synthesis of industry
forecasts and it falls into the middle. The black line
represents the state's official revenue forecast and is
slightly more conservative than the average.
Co-Chair Stedman added that the production forecast is
normally much tighter than the price forecast. The price
sensitivity in the budgets overwhelms the volumes
sensitivity. It is hoped that the price forecast is as
accurate as the "barrels" forecast.
Ms. Keppers turned to slide 24, the fall 2009 DOR oil price
forecast for WTI and ANS. Co-Chair Stedman requested
information on the drifting off of West Texas Intermediate
as a benchmark.
Commissioner Galvin said WTI is a standard benchmark and a
published index of the West Coast oil price for delivery at
a refinery. The differential between Alaska North Slope
(ANS) and WTI will fluctuate. The state uses for
forecasting purposes a $2.50 discount from WTI to get to
ANS projections. In reality, ANS has had more premium sales
over WTI recently.
10:46:04 AM
Senator Egan asked if heavy oil is being considered.
Commissioner Galvin answered that it is sometimes
considered. He explained that on the upstream side, heavy
oil costs more per barrel to produce. A "quality bank"
adjustment is incorporated into future projections to
account for heavy oil.
CHERYL L. NIENHUIS, ACTING CHIEF ECONOMIST, DEPARTMENT OF
REVENUE, testified via teleconference. She agreed that
there are additional costs to produce heavy oil. Heavy oil
is discounted when it is marketed because it is not worth
as much as light, sweet crude. A quality bank is something
that occurs in Alaska when oil is sold to refineries which
extract the most valuable oil components in order to refine
it. Whatever is put back into the pipeline generally
decreases the quality of the oil.
Co-Chair Stedman noted that the 20 percent credit embedded
in ACES and PPT is targeted to deal with the extra cost of
heavy oil.
10:49:58 AM
Commissioner Galvin commented that the department is
gaining a window into the profiles of the companies that
wasn't available previously. Company tax reports have
provided data related to lease expenditures; however, this
information is just beginning to provide data which can be
analyzed.
Co-Chair Stedman noted pointed out that legislative
consultants have been surprised by the lack of information
from the oil companies. Commissioner Galvin stated that
there are restrictions as to how much taxpayer information
can be provided. The lease expenditure information must be
presented in an aggregated form, rather than on a taxpayer-
specific basis.
Mr. Stickel related that the department has historical data
on lease expenditures based on annual tax returns and
monthly information forms from 2007-2009. There is also
data on capital expenditures from PPT information. Under
ACES the department also requests forecasts from the
producers for estimates of expenditures. The producers
provide forecasts of expenditures as well as plans of
development for projects. Companies typically provide a
five-year window. The department's lease expenditure
forecast is based on this information from the companies.
10:54:28 AM
Mr. Stickel explained slide 27 - Lease Expenditures
(Costs). He related that the report contains three-year
historical lease expenditure data. The graph shows
operating expenditures for the North Slope at about $2
billion a year, which have been steady from FY 07 to FY 09
and should remain so for FY 10 and FY 11. Capital
expenditures show an increase over the last two years and
continuing to do so. Some companies are reducing capital
expenditures; however, new companies are not.
Co-Chair Stedman suggested that information about revenue
sources would be forthcoming.
Mr. Stickel related information on slide 28 - lease
expenditures per barrel. Operating expenditures have been
relatively steady, but are increasing on a per barrel
basis. Capital expenditures on a per barrel basis have more
than doubled.
Co-Chair Stedman recalled that when the legislature was
looking at PPT, capital expenditures were expected to
increase by $1 billion in the Basin. He thought it would be
interesting to revisit the expectations under the net
profit tax versus under ELF, as well as projections on
capital expenditure trends.
10:57:22 AM
Co-Chair Stedman requested that committee members make
requests regarding more information on the revenue forecast
model.
ADJOURNMENT
The meeting was adjourned at 10:57 AM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SFinPresent - 1 26 10.pdf |
SFIN 1/26/2010 9:00:00 AM |
DOR - Forecast |
| Teal Fiscal Summary2011.pdf |
SFIN 1/26/2010 9:00:00 AM SFIN 1/27/2010 9:00:00 AM |
FY11 OMB Overview FY11- OMB Ovierview |