Surge Energy pours $7 billion into Texas economy

The highest amounts of oil and natural gas production taxes poured into Texas coffers in fiscal year 2022, ending August 31 – up to more than $10 billion.

That doesn’t include the severance taxes that operators pay for producing oil and natural gas – nor the royalties, fees, property taxes and sales taxes they also pay.

Surge Energy US announced this week that it had added more than $7 billion to the state’s economy as of November in its seven years in business. That amount includes oil and gas revenue, royalty payments and working interest and production taxes.

The company attributes this milestone to its continued growth through acquisitions and ongoing development projects. Booming officials point out that the $7 billion it contributed has benefited the state economy and local communities through capital investment, royalty payments to mineral owners with interests in its producing acreage, contributions to state and local taxes and job creation.

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Since its creation in 2015, Surge has paid more than $1.75 billion in working interest partnership payments and royalty payments on royalty payments to mineral owners.

“We think Surge has had a positive impact on the state of Texas,” Travis Guidry, vice president, corporate development and investor relations, told the Reporter-Telegram in an email. “In addition to the $7 billion contribution to the Texas economy, we have also made an impact by directly hiring employees and contractors. We currently employ 200 full-time employees and contractors. There is also a significant indirect impact on job creation through the service companies we partner with.”

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In addition, Guidry wrote, “We also consider our industry vital to the Texas economy because it is our belief that the oil and gas industry provides a reliable, low-cost source of energy that helps people live better lives.”

Chief Executive Officer Linhua Guan said in a statement, “Surge is proud to celebrate this significant achievement of contributing $7 billion to the Texas economy in our short seven-year history as a company. These revenues, working interest payments, royalty payments, and production taxes have a significant economic impact in Texas and we look forward to future growth opportunities.”

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Surge Energy is focused on the development, exploration, production and acquisition of oil and natural gas reserves in the Midland Basin. The company currently has approximately 114,000 net acres in the Permian Basin. Currently, Surge operates three drilling rigs at its Moss Creek asset in Howard and Borden counties, according to Guidry. He wrote that Surge plans to continue at that level into 2023 and is likely to remain at that level “barring a significant change in commodity prices.”

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