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  • How the Oil Industry and Region Benefit and Support the StateFebruary 11, 2019


    • Review the extraction and gross production tax collections by the State of North Dakota for fiscal years 2008 through 2018, the period since the development of the Bakken.
    • Detail the various funds that benefit from oil tax revenues
    • Highlight how various state funds and distributions are provided to all areas of the state
    • Show benefits of oil tax revenues throughout the state


    • Oil extraction and production tax revenues are nearly $18 billion for fiscal years 2008-2018
    • During the Bakken development oil extraction and production taxes are more than 44% of all taxes collected by the state
    • In the past 5 fiscal years oil extraction and production taxes are approximately 50% of all taxes collected by the state
    • $1.2 billion dollars for water projects throughout the state
    • Local transportation funding exceeds $875 million
    • Legacy Fund has received over $4.5 billion
    • Over $7.3 billion invested in communities and infrastructure across the state

    Extraction Tax

    The gross value of oil production at the well, less any part which is specifically exempt. The current extraction tax rate is 5%.

    Gross Production Tax

    Gross value of oil production at the well, less any part which is specifi cally exempt, is taxed in lieu of property taxes on the oil and gas producing properties. Gas production is taxed on a volume basis at a rate determined by the movement of a fuels cost index. The current gross production tax rate is 5%.

    Benefits for the Entire State

    The oil and gas taxes are deposited into various trust funds that are used to support investments around the state. These funds include the Resource Trust fund for water projects, Common Schools and Foundation Aid Funds that support K-12 education, and the Outdoor Heritage Fund that provides grants for projects that enhance, preserve and expand outdoor recreation and conservation efforts in the state.

    For more information visit: TaxStudy.NDEnergy.org