Joco Today

U.S. Senators Roger Marshall and James Lankford have introduced a bill aimed at supporting small oil producers by offering tax incentives for well management. The legislation allows producers to deposit funds into a tax-free account, with the principal and any gains being non-taxable if used for capping and remediating wells.

Kansas and Oklahoma are home to many small, independent "stripper wells" that play a crucial role in regional energy production. These wells often face financial challenges when they reach the end of their operational life and need to be capped and removed. The proposed bill seeks to encourage producers to save for these future expenses, promoting responsible resource management.

Senator Marshall highlighted the importance of this legislation for Kansas, stating, “Oil producers in Kansas take pride in their responsible care of the land when they drill wells. This commonsense legislation supports our energy independence while promoting responsible stewardship of our natural resources, ultimately leading to more production, lower prices, and a cleaner Kansas.”

Senator Lankford emphasized the significance for Oklahoma's energy sector: “Oklahoma’s oil and gas producers are essential to America’s energy independence. While the Biden Administration tries to undermine our American energy future, this legislation empowers our smaller producers to provide our nation the energy abundance we will require to lead the world for the next century.”

The National Stripper Well Association has expressed support for the bill. They stated, “The National Stripper Well Association is grateful to Senators Marshall and Lankford for their leadership in introducing this critical legislation. Costs associated with the important process of closing and remediating wells, like the cost of many other aspects of society, are rising. The additional ‘tools in the toolbox’ this bill provides will bring welcomed financial flexibility to ensuring completion of these significant processes in well operations.”