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Texas Supreme Court Holds that Add-Back Provision in Oil and Gas Lease Required Royalties to be Paid on Prices in Excess of the Producers’ Gross Proceeds

The Energy Law

2023), in which it held that lessees owed royalties in excess of their gross proceeds, specifically “adding back” costs incurred by third-party buyers that were enumerated in the sales contract and subtracted from the sales price. The lessees owned working interests in certain oil and gas leases that were executed in 2007.

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Texas Supreme Court Rules Oil and Gas Producer Not Entitled to Sales Tax “Manufacturing Exemption”

The Energy Law

On June 17, 2016, the Texas Supreme Court ruled that an oil and gas producer (“Southwest”) was not entitled to a statutory exemption from sales taxes on its purchases of casing, tubing and pumps used in the production of oil and gas (the “Equipment”). At issue in Southwest Royalties, Inc.

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Lithium Extraction May Soon Turn Produced Water Into Produced Profits

The Energy Law

First, the Advanced Manufacturing Production Credit grants a tax credit equal to 10% of the costs incurred to produce any critical minerals, [1] including lithium. [2] American oil and gas producers may soon be poised to capitalize on this demand, as produced water from some areas contains appreciable levels of dissolved lithium.

E&P 105
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With A New Regulatory Framework On The Horizon, There Is Still Much Uncertainty Concerning The Future Of Offshore Carbon Storage

The Energy Law

The CEQ report noted that royalty rate reduction credits for carbon capture could potentially create financial incentives for investment and recognized the need to address long-term liability after a storage site has been closed.

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