Midterm Elections Bring Oil & Gas Scrutiny in Ohio & Elsewhere
With midterm elections fast approaching, the oil and gas industry has a lot at stake, especially in key states in the northeast region of the country, including New York, Ohio, Pennsylvania and West Virginia. For example, in resource rich Ohio, current Republican Governor John Kasich is up for reelection and campaigning on higher taxes for the shale fracking industry.
Governor Kasich has pushed for greater scrutiny and severance taxes on hydraulic fracturing across the state of Ohio. This year, he has repeatedly argued that the current taxes are too low and a “rip off” for the citizens of Ohio who are missing the benefits of the burgeoning industry. However, with the midterm elections approaching, Governor Kasich has been stuck in a lame-duck session and been unsuccessful in forwarding meaningful legislation.
It now appears that Governor Kasich has strong prospects for winning his election and keeping his seat in 2015. Since he has campaigned for stricter taxes, the Ohio legislature may view his election as a mandate from the constituents to enact his proposed 2.75 percent tax rate. Such a tax would collect up to an estimated $170 million a year from the fracking industry.
This legislation could prove troublesome for future excavation in Ohio. Ohio sits on some of the country’s largest natural gas deposits, including the Utica Shale and the Marcellus Shale. Ohio’s Natural Resources Department estimates that the Utica Shale alone contains between roughly three and 15 trillion cubit feet of natural gas.