Oil and gas producers in Louisiana could pay lower royalties to drill on state lands under a new plan released by the Louisiana Department of Conservation and Energy.

Under the 2026 State Lease Investment Program, royalty payments on new and existing mineral leases on state lands could be cut in half. The period for public comment is open through Jan. 28.

The program was developed to fulfill directives in an executive order signed by Gov. Jeff Landry in June that aims to increase production. In south Louisiana and the state’s offshore areas, total annual oil production fell from 58 million barrels in 2013 to 26 million barrels in 2023, or by 58% in 10 years, according to the executive order.

By incentivizing exploration and production through targeted royalty adjustments and severance tax reforms, Louisiana will stimulate increased investment and activity in the oil and gas sector, leading to higher production volumes that ultimately generate greater overall revenues despite initial rate reductions, Landry said in the executive order.

“Our staff have proposed a way to prime the pump on investing here by giving companies a financial decision that is easier to make in favor of drilling and producing here,” Louisiana Conservation and Energy Secretary Dustin Davidson said.

More here

Tagged: Partner BACK TO HOMEPAGE