Texas Tax Code

§ 202.0545 — TAX EXEMPTION FOR ENHANCED RECOVERY PROJECTS USING ANTHROPOGENIC CARBON DIOXIDE

TX § 202.0545Title 2. STATE TAXATION · Part I. SEVERANCE TAXES · Ch. 202. OIL PRODUCTION TAX · Art. B. TAX IMPOSED

Statute text

(a)Subject to the limitations provided by this section, until the 30th anniversary of the date that the comptroller first approves an application for a tax rate reduction under this section, the producer of oil recovered through an enhanced oil recovery project that qualifies under Section 202.054 for the recovered oil tax rate provided by Section 202.052(b) is entitled to an additional 50 percent reduction in that tax rate if in the recovery of the oil the enhanced oil recovery project uses carbon dioxide that:

(1)is captured from an anthropogenic source in this state;

(2)would otherwise be released into the atmosphere as industrial emissions;

(3)is measurable at the source of capture; and

(4)is sequestered in one or more geological formations in this state following the enhanced oil recovery process.

(b)In the event that a portion of the carbon dioxide used in the enhanced oil recovery project is anthropogenic carbon dioxide that satisfies the criteria of Subsection (a) and a portion of the carbon dioxide used in the project fails to satisfy the criteria of Subsection (a) because it is not anthropogenic, the tax reduction provided by Subsection (a) shall be reduced to reflect the proportion of the carbon dioxide used in the project that satisfies the criteria of Subsection (a).

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Legislative history

Acts 2009, 81st Leg., R.S., Ch. 1109 (H.B. 469), Sec. 5, eff. September 1, 2009. Acts 2021, 87th Leg., R.S., Ch. 460 (H.B. 1284), Sec. 6, eff. June 9, 2021.