New Study: Offshore natural gas and oil reserves could provide billions of dollars in revenue for Virginia
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RICHMOND, November 15, 2018 – The Virginia Petroleum Council today released results from a new study showing that Virginia’s economy could benefit from nearly $1.6 billion in tax revenues as a result of offshore leasing and development in the Atlantic Outer Continental Shelf (OCS).
“The potential tax revenues shown in this new study could be a major boost for investments throughout the state, in areas such as education and rebuilding infrastructure,” said Virginia Petroleum Council Executive Director Miles Morin. “This opportunity for over one billion dollars in increased state and local government revenues, coupled with the additional billions of dollars from potential investment in the economies of coastal states from previous studies, is critical for helping to improve quality of life for Virginia’s residents and the overall future of the state.”
The new report titled, The Economic Impacts of Allowing Access to the Atlantic OCS for Oil and Natural Gas Exploration and Development Supplement: Projected State, Local and Federal Tax Receipts, focuses on state and local tax revenues and was prepared by CALASH on behalf of API. Calash projects that offshore-related natural gas and oil activities in Virginia could generate additional non-bonus and royalty revenue such as personal and corporate income tax, property tax, and sales taxes. The associated state and local tax revenues are projected to reach nearly $160 million annually by the end of the forecast period, according to the report.
Cumulative state and local tax revenues due to industry spending are projected to total nearly $1.6 billion across the 20-year forecast period. This projection includes:
- Cumulative personal income and payroll taxes: $351,000,000
- Cumulative personal property and other taxes and fees: $58, 000,000
- Cumulative corporate income tax (Including dividends): $27,000,000
- Cumulative business sales, property, excise, custom and other: $1,138,000,000
This report builds on a prior report released in March of 2018 which showed that contributions to the economy from Atlantic OCS oil and natural gas exploration and development activity in Virginia could reach more than an additional $2.1 billion within 20 years. The same report shows that offshore natural gas and oil related activity on the Atlantic Coast could support nearly 25,000 jobs annually in Virginia within 20 years. For additional information visit Explore Offshore, the website for a bipartisan coalition dedicated to safe and environmentally responsible access to our offshore energy resources to help supply affordable energy for American consumers, small businesses, and manufacturers.
Advanced technology, safety standards, best practices, and regulations are designed to protect the environment, marine life, and workers - while enabling the oil and natural gas industry to work alongside recreational fishing, tourism, and military activities. Since 2010, more than 100 standards were created or strengthened, including for improved safety and environmental management, well-design, blowout prevention, and spill response to ensure we have the best protections and highest safety measures in place.
The Virginia Petroleum Council is a division of API, which represents all segments of America’s oil and natural gas industry. Its more than 600 members produce, process, and distribute most of the nation’s energy. The industry supports 10.3 million U.S. jobs and is backed by a growing grassroots movement of more than 47 million Americans.