Enhanced Oil Recovery (EOR) Tax Incentives
Under the current version of the incentive, oil produced from an approved new enhanced oil recovery project or expansion of an existing project is eligible for a special EOR tax rate of 2.3 percent of the production’s market value (one-half of the standard rate) for 10 years after Commission certification of production response. For the expansion of an existing project, the reduced rate is applied to the incremental increase in production after response certification. (See Tax Code, §202.054, Qualification of Oil from New or Expanded Enhanced Recovery Project for Special Tax Rate, 16 Tex. Admin. Code §3.50)
