Natural gas reports spike in W.Va. tax payments

CLARKSBURG, W.Va. — As the coal industry continues struggling in West Virginia, the natural gas industry produced a spike in tax revenues during 2014.

The West Virginia oil and natural gas industry paid more than $188 million in severance taxes last year, more than doubling the total from 2013.

The steep increase came as a surprise to Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association. Given the desperate regulatory and market conditions plaguing the coal industry—resulting in recent government layoffs in Boone, Mingo and Nichols counties—DeMarco said natural gas is picking up the slack.

“For us to be able to replace the dollars that have not been coming along because of the ‘war on coal’ is quite fortunate for the state,” he said.

Some 90 percent of the natural gas severance taxes are allocated to the state, with 7.5 percent going to gas-producing counties and 2.5 percent distributed among all counties.

Projections for rising demand could buffer against a dip in natural gas production, DeMarco said.

“If we’re able to get the commodity price up, which is a supply-and-demand issue,” he said. “If the price comes up for natural gas then you don’t have to have the equal production as before to still have the same amount of revenue.”





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