West Virginia has a phenomenally complicated taxation structure when it comes to, well, everything—but especially for oil and gas wells. The severance tax is 5%—that’s pretty easy. But WV also has an ad valorem (property) tax for both drillers and mineral rights owners. The way WV calculates the value of income-producing properties takes a tax attorney to figure out. In Marshall County, tax attorney John Mairs represents both Chesapeake Energy and Chevron. Chesapeake has 29 wells in the county and Chevron has 19.
Mairs was successful in getting Chesapeake’s property assessments on their 29 wells reduced by nearly $60 million, but Chevron’s assessment was reduced by only $20 million and that was due to a clerical error at the state level. Here’s the story on how and why the property assessments were modified in Marshall County for these two drillers: