The staggering financial benefits of Texas oil and gas Image By EPN Staff Texas’ oil and natural gas industry shattered production and revenue records in 2024 and paid $27.3 billion in state and local taxes and royalties, the Texas Oil & Gas Association said. Those taxes and royalties beat the previous record, set in 2023, by nearly $1 billion, and the industry also set records for procession, refining, storage and exports, the association said. “Texas oil and natural gas makes an outsized and unmatched contribution to the financial might of our state,” association President Todd Staples said during a recent briefing. Why it matters The revenue generated by oil and gas in Texas exceeded the annual budget of 19 states, including Kansas, Nevada and Nebraska. The association said the taxes and royalties paid by the oil and gas industry amounted to $74.8 million a day in 2024. Natural gas eclipsed records that weren’t even a year old, the association said, with production topping 1 trillion cubic feet per month six times in 2024. Crude oil production set records in six of the last 12 months, and in October the industry produced as much as 5.86 million barrels a day in Texas. The association said that was the highest monthly total ever and 44% of U.S. output for the month. Much of the tax revenue this generates goes toward Texas schools and universities. The Texas Permanent School Fund endowment, which the industry feeds, has more than $57 billion in it, making it the largest educational endowment in the nation. The association said that, since 2007, when it first started compiling this data, the Texas oil and natural gas industry has paid more than $257.6 billion in state and local taxes and state royalties. The bigger picture Texas is the second most populous state and the No. 3 state for business in the U.S., and its energy dominance extends beyond oil and gas. It’s also: No. 1 for renewable energy The top state for utility-scale solar energy A leading prospect for geothermal exploration A hub for carbon capture growth Clean energy trade groups issued their own report in January on financial impacts, finding existing and expected solar, wind and battery storage projects in Texas would contribute more than $20 billion in total tax revenue over the projects’ lifetimes. Those projects would also pay Texas landowners $29.5 billion, the association said. That’s a much longer timeline – decades of impact compared to one year of oil and gas royalties. But the Solar Energy Industries Association said the revenue is stable and that officials and landowners appreciate being able to plan around consistent-long term revenue streams. The state is well positioned to capitalize on energy-friendly policy promoted by President Donald Trump’s administration. Some renewable projects, however, such as wind generation may be affected by policy changes the administration is implementing, as the underlying report notes. “Any policy changes that reduce renewable or storage deployment in Texas will reduce these benefits, which are a lifeline to many rural communities across the state,” the executive summary states.
