Bill > SB2397

This bill proposes several modifications to North Dakota's tax regulations for oil and gas wells, focusing on providing tax exemptions and incentives for specific types of wells and production methods. The bill introduces a new definition for "development incentive wells," which are wells that utilize innovative drilling or completion techniques, demonstrate the potential to develop previously underdeveloped reserves, and are likely to increase overall production. Operators meeting certain criteria based on the number of wells they own can have up to 4-12 development incentive wells certified by the industrial commission, with those wells receiving a tax exemption for the first 250,000 barrels of oil produced within 36 months of completion. The bill also modifies existing regulations around gas production, including expanding exemptions for gas used in enhanced oil recovery projects and clarifying conditions for temporary tax exemptions for wells employing systems to avoid gas flaring. Additionally, the bill provides specific provisions about which operators can qualify for these incentives and sets an effective date of July 1, 2025, with the development incentive well provisions set to expire on June 30, 2031. The bill aims to encourage technological innovation and more efficient oil and gas extraction in North Dakota by providing targeted tax incentives.

Budget and Finance

https://ndlegis.gov/assembly/69-2025/regular/bill-overview/bo2397.html