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Published April 23, 2009, 07:43 AM

Tax cut on new oil production approved

North Dakota lawmakers have approved a new set of tax breaks for newly drilled oil wells. They’re expected to take effect next month. North Dakota’s top oil tax rate is 11.5 percent. The legislation cuts the rate to 7 percent unless oil prices rise above $70 a barrel.

BISMARCK (AP) — North Dakota lawmakers have approved a new set of tax breaks for newly drilled oil wells. They’re expected to take effect next month.

North Dakota’s top oil tax rate is 11.5 percent. The legislation cuts the rate to 7 percent unless oil prices rise above $70 a barrel.

The tax incentive also would expire if a newly drilled oil well has been pumping for 18 months, if it produces at least 75,000 barrels of oil, or if it pumps at least $4.5 million worth of oil.

The measure got a two-thirds vote in both the North Dakota House and Senate, meaning it will take effect shortly after Gov. John Hoeven signs it. It will expire in three years.

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The bill is HB1235.

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