The Texas oil and gas industry shattered records last year in 2019 by paying $16.278 billion in state and local taxes, the most ever in Texas history, and was poised to break that record in 2020.

The Texas Oil & Gas Association (TXOGA) had big plans to further industry growth as well as continue working on environmental health and job growth in the state.

It was the news of a global pandemic early last year that caused the oil and gas industry to come to nearly a complete halt. 

Saudi Arabia and Russia dumped oil onto the market at the first sign of danger which caused the U.S. oil market to fall into the negatives in April for the first time in history. Then, American citizens were placed on lock down, putting an even harder strain on the oil and gas industry as people weren’t driving anywhere.

But during at that time, TXOGA President Todd Staples was still optimistic.

“To say that we are in unprecedented times is really an understatement,” Staples said  kicking off a TXOGA energy summit last November. “The disruption to society from the COVID pandemic has made everyone, worldwide, adjust our way of living, working and educating our children.

“Oil and gas has been the cornerstone of the Texas economy, and will continue to be.”

He may have been on to something.

Last week TXOGA released their annual report which showed that the Texas oil and natural gas industry paid $13.9 billion in state and local taxes and state royalties in fiscal year 2020. Those funds directly support Texas schools, teachers, roads, infrastructure and essential services. 

Staples said in a briefing that only three of the past 13 years have exceeded that total.

“Even in an extremely difficult year, the Texas oil and natural gas industry continues to contribute tremendously to state and local tax coffers, while fortifying our energy security and leading the way in innovation and investment that is advancing environmental progress,” Staples continued.  “The ongoing recovery of the oil and natural gas industry is essential to the state’s continuing economic improvement.”

Staples added that the pandemic reinforced the fact that oil and natural gas are essential and irreplaceable as products made from oil and natural gas, such as face shields and hand sanitizers to high-speed internet connections and computers.

In 2020, 99 percent of the state’s oil and natural gas royalties were deposited into the Permanent School Fund and the Permanent University Fund (PUF), which support Texas public education.  The PUF received $771 million and the PSF received $942 million.  The Rainy Day Fund received $1.657 billion from oil and natural gas taxes.

Also last year, Texas school districts received more than $2 billion in property taxes from mineral properties producing oil and natural gas, pipelines, and gas utilities.  Counties received $688.4 million in these property taxes.

While there is very little actual oil drilling in San Patricio County, Staples said last year that oil and natural gas is driving growth and prosperity along Texas southern Gulf Coast with record crude oil, liquefied natural gas and exports of refined products along with new manufacturing projects. He added that the Port of Corpus Christi is related to more than $600 million in tax revenues that goes directly to local schools, cities and counties along with billions of dollars in personal income.

In addition to its economic impact, Staples noted that the oil and natural gas industry has taken the lead in developing environmental solutions that are working to reduce emissions and flaring.

“The oil and natural gas industry is the nation’s leading investor in emission-reducing technologies and as a result, Americans are breathing the cleanest air in decades, the U.S. leads the world in reducing energy-related carbon dioxide emissions and methane emissions from oil and natural gas systems are down 23% since 1990,” he said.

Corpus Christi Regional Economic Development Corporation President and CEO Ian Vasey said during a TXOGA Energy Summit last October, “We’re not going to kill the golden goose. We believe, as an economic development outfit, that we have to promote smart and sustainable economic development policies, and we try to work with those good actors in industry who are cognizant of environmental standards.”

According to data from Railroad Commission of Texas, the percentage of natural gas flared out of all the natural gas produced in Texas decreased 80 percent between June 2019 and May 2020. The Commission announced that less than one half of one percent of the natural gas produced in Texas was flared or vented, as of May 2020. 99.5 percent of natural gas produced went to beneficial use.

TXOGA is also urging lawmakers to maintain their commitment to science-based policy and rational discussions related to environmental issues, with the leading oil and natural gas innovators at the table.

Staples continued, “Smart policies will encourage investment in and innovation by the oil and natural gas industry and will power us toward the cleaner, stronger, and better future every Texan deserves.” 


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