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NSWA Mission Statement

It is the belief of NSWA that producers and operators of marginally producing wells have a unique set of needs and concerns regarding federal legislation and regulation. NSWA’s sole responsibility is advocacy on behalf of these small producers.
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Percentage Depletion Calculators

If you STILL don't know exactly what percentage depletion means to you, download one of our Percentage Depletion Calculators and take it to your accountant.

NSWA Percentage Depletion Worksheet

Percentage Depletion vs. Cost Depletion Calculator (property by property basis)


NSWA Chairman's Update

Mike Cantrell, NSWA Chairman

On September 16th, we (the National Stripper Well Association) had a good breakfast event in Washington, DC, with Senator Ron Wyden (D-OR) Chairman of the Senate Finance Committee.

Our mission for the trip was to keep a dialogue open with him and to continue to discuss percentage depletion. I think we accomplished our mission. The next day, Wednesday, Sept. 17th, Senator Wyden chaired a Senate Finance Committee hearing on energy tax provisions. While the hearing dealt primarily with keeping tax subsidies for wind and solar energy production, Sen. Wyden did mention his compromise legislation with Senator Coats that kept oil and natural gas tax provisions intact. I doubt this would have been on his mind, if we had not reminded him of it the day before.

I have to tell you after spending two days with Congressional members and staff on Capitol Hill, we are failing in our efforts to keep percentage depletion off the chopping block in the tax reform discussion. Republican staffers have told us privately that percentage depletion will be eliminated, while IDCs are “probably okay.”

We have seen percentage depletion bargained away in comprehensive tax reform drafts – three times.

This is a situation the NSWA must correct if we are to retain percentage depletion. Be looking for a letter from me in the coming months outlining our battle plan for the future.

Many of you are responsible for making the NSWA a relevant, functioning association. For years it was a name-only organization. While that is something we can all be proud of, it’s not nearly enough.

What I will suggest in the coming months is no reflection on all the good work that has brought us where we are today.

I am only saying that percentage depletion, while it's on life support now, may soon be a casualty of comprehensive tax reform if we don’t undertake a campaign to save it.


What is percentage depletion?

United States Tax Code Sections 611, 613, 613A

This is a 15% deduction allowance against taxable income utilized by independent producers and royalty owners. It’s limited to the first 1,000 barrels/day of production. Congress eliminated percentage depletion for major oil companies more than 30 years ago.

Why it’s important: Percentage depletion has been available to independent producers since 1954 as an incentive to stimulate continued investment in a high-risk industry. It provides the capital and outside investment small producers need to maintain marginal wells. These wells make up 20% of our production.

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Houston M&M Luncheon October 30

Please join us at the Houston Petroleum Club, Thursday, October 30 for the NSWA's Meet and Mingle Luncheon.

Guest speakers will be NSWA Chairman and longtime Oklahoma oilman Mike Cantrell, and former United States Congressman Bill Brewster. Topics of discussion will be NSWA's current engagement in the battle to keep the percentage depletion allowance through the tax reform process, and the continued growth of the organization.

The luncheon is hosted by NSWA Executive Board Member J.E. Taylor, Taylor Energy Services, LLC of Houston, along with Jeff Caperton, Magellan Land Services, Inc.; and Greg Hudson, Cozen O'Connor.

To RSVP, please call Jamie at (405) 228-4112, or email jwhitefield@nswa.us.

Download a printable invite here.

We will see you in Houston!

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