Louisiana is launching a new royalty relief program to encourage oil and gas production by temporarily reducing what companies pay to extract resources on state lands. The incentives apply to new drilling, restarted wells and upgrades, and are aimed at attracting investment, boosting output and reinforcing the state’s position as a competitive energy producer.
The program lays out a process for amending existing state leases to allow for reducing royalties by up to 8%, but never below the legal floor of 12.5%, for up to seven years for newly drilled wells or for orphaned wells brought back into production. Operators re-starting production on wells shut in for six months or longer, or operators doing substantive workovers can receive the benefit for up to six years. For more information on the program, visit the Louisiana Department of Conservation and Energy.
