The surging price of crude oil helped Eddy County end the 2022 fiscal year on a positive note as revenues from oil and gas tax collections exceeded budget expectations, according to Eddy County Finance Department data.
Eddy County Finance Director Roberta Smith said the County collected $8.8 million in tax revenues from oil and gas activity during June, the final month of the 2022 fiscal year.
Fiscal years in Eddy County start July 1 and end June 30.
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June’s tax collections were based on oil and gas business conducted in Eddy County during March as operations in the Permian Basin produced 18.2 million barrels of oil, Smith said.
The price for West Texas Intermediate (WTI) sweet crude oil varied from $99 a barrel to $115 a barrel during March, per information from the U.S. Energy Information Administration (EIA).
WTI was the world’s most actively traded energy product, according to the Chicago Mercantile Exchange.
June’s oil and gas production collections were the highest during the fiscal year.
Eddy County started the 2022 fiscal year with $3.5 million in oil and gas tax production collections in July 2021. July’s collections were based on business activity in the County’s oilfields in April 2021 when the average WTI was around $62 a barrel, according to EIA data.
WTI prices rose almost $40 from April 2021 to April 2022, EIA noted.
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Eddy County projected $25 million in oil and gas tax collections at the start of the 2022 fiscal year. Smith said Eddy County’s actual revenue was $43 million more than projected.
She said production in the oilfields located in Eddy County averaged 65 million barrels of oil for fiscal year 2022 with an average price of $75 for WTI. Smith said Eddy County’s budget was crafted by speculating 13 million barrels of oil would be produced per month with a price of $47 a barrel that fiscal year.
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Smith said the County collected $3.9 million in GRTs in June.
“Overall, for the fiscal year we collected over $16 million what we budgeted of $22.2 million,” she said.
Smith said Eddy County collected $39 million in GRTs at the conclusion of the 2022 fiscal year.
“It was a 110 percent increase of what we collected last year,” she said.
The County collected $16.8 million in GRTs during the 2021 fiscal year, per County Finance data.
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The New Mexico Taxation and Revenue Department defined GRTs as money received through various business activities.
Mike Smith can be reached at 575-628-5546 or by email at [email protected] or @ArgusMichae on Twitter.