(Juneau) - Legislation that generates billions of dollars in additional oil and gas revenue for future generations of Alaskans passed the Alaska Senate this evening. HB 3001 replaces the state's outdated ELF system with a thoroughly modern oil tax plan that raises significantly more revenue and can help to refill the trans-Alaska Oil Pipeline by encouraging the industry to explore for new oil deposits.

Sen. Ralph Seekins (R - Fairbanks) chairs the Senate Special Committee on Natural Gas Development, the committee responsible for the landmark legislation.

"This legislation hits all the bases. It modernizes the state's petroleum tax structure and spurs the industry to go out and drill for more oil by granting tax credits for verifiable expenditures made in Alaska. This bill also captures our fair share of record high oil prices so Alaska has the revenue it needs for many years to come," Said Sen. Seekins.

"There is far more to this piece of legislation than just raising more oil revenue because it eventually creates new, good paying jobs in many different sectors of the economy," said Senate President Ben Stevens.

Here are some highlights of bill:

• 20% production tax credits for oil and gas investment in Alaska
• 22.5% tax rate on "net" positive cash flow or "Production Tax Value"
• Progressivity. A higher tax rate (.25) kicks in when oil sells for more than $55 per barrel.
• At today's ANS closing price of $75.05 and a full year of production the PPT will generate 3.7 billion in one year revenues, almost three times the amount generated under the current ELF based production tax.
• Protects declining Cook Inlet oil production by leaving the existing tax structure in place.
• Requires a report in 2011 about how well all the incentive provisions are working to enhance exploration, development and production in the state.

The bill now goes to the house for a concurrence vote on changes made by the senate.

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