Marcellus impact fee adversely affected by the slow-down

Gas field well head
Source: DollarPhotoClub

The low natural gas prices and the resulting decline in the number of wells drilled has adversely influenced the Marcellus impact fee, according to a recent report by The Independent Fiscal Office.

The state research office projected that impact fee revenue collected during 2015 could be anywhere from $15 million to nearly $34 million less than the $223 million collected in 2014.

The state of Pennsylvania – America’s second-largest natural gas producer – does not tax the drillers on the gas they produce but rather impose an annual fee based on the number of unconventional wellheads drilled and the wholesale prices of natural gas. This impact fee, which amounts to less than one percent of the state’s total tax revenue – is utilised to support projects that aim at minimising the impact of drilling activities in Northeast Pennsylvania and other Marcellus regions.

The impact fee took in $204 million retroactively in 2011; $202 million in 2012, when the law was enacted; $225.7 million in 2013; and $223.5 million in 2014, according to the Independent Fiscal Office.

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