MS SB2907

Reduces severance tax on oil produced from horizontally drilled wells and horizontally drilled recompletion wells with production commencing after July 1, 2013, from 6% to 1.25% for 30 months from first sale or until well payout, whichever occurs first.

Reduces severance tax on natural gas produced from the same well types under identical conditions from 6% to 1.25% for 30 months from first sale or until well payout, whichever occurs first.

Requires operators to apply to the State Oil and Gas Board for the reduced rate and provide semiannual payout status by signed affidavit.

Directs all revenue from the reduced tax on horizontally drilled wells to be apportioned to the county where the oil or gas was produced, rather than split between state and county under normal apportionment formulas.

Provisions expire July 1, 2018, but wells beginning production before that date continue to receive the reduced rate for the full 30-month period.