Michael Wood tallies up how much revenue PA would have collected if we’d had West Virginia’s modest severance tax on gas drilling since June 2009:
The state’s Department of Environmental Production (DEP) recently published a biannual report on Marcellus Shale production in Pennsylvania. (Most states require monthly reporting, but that is a different story.) In the data, we can now see how much the state has really given away by refusing to put a robust gas extraction tax in place — and the sum is staggering.
From July 2009 to June 2012, over $8 billion worth of natural gas was extracted from Pennsylvania’s share of the Marcellus Shale. The Commonwealth would have collected more than $500 million had we had West Virginia’s natural gas tax in place. Instead, we got $0.
The recent DEP report was incomplete, as the Associated Press highlighted. Production from Chesapeake Energy (likely the state’s largest gas producer) wasn’t included nor disclosed as being missing in the initial release. Add in the production from Chesapeake over the last six months, and the lost tax revenue figure would be even bigger.