2025 Energy & Economic Impact Report

2025

ENERGY & ECONOMIC IMPACT REPORT

PUBLISHED January 7, 2026

About TXOGA Founded in 1919, the Texas Oil & Gas Association (TXOGA) is a statewide trade association representing every facet of the Texas oil and natural gas industry.

The mission of TXOGA is to promote a robust oil and natural gas industry and advocate for sound, sciencebased policies and free-market principles.

TABLE OF CONTENTS 05

A Message from Our President

06

Fueling the Economy

09

Fueling the Workforce

12

Fueling Public Education

14

Fueling Communities

16

Fueling Savings & Highways

20

The Industry at a Glance

22

The Big Picture

A Message from Our President On behalf of the members of the Texas Oil & Gas Association, I am pleased to present our annual Energy & Economic Impact Report, which details the extraordinary role oil and natural gas play in undergirding the Texas economy and securing our energy future.

In Texas, lasting progress is built on performance, not opinion. Results matter. Reliability matters.

And even during a year dominated by market challenges, oil and natural gas have once again proved to be the power behind Texas’ progress. While oil prices declined, the industry delivered another outstanding year of strong economic performance – supporting rising employment, higher wages, and critical investments statewide.

In Fiscal Year 2025, oil and natural gas proved, once again, to be the power behind Texas’ progress.

In Fiscal Year 2025, the industry employed nearly 500,000 Texans and paid $65.9 billion in wages; including direct and induced effects, it supported approximately 1.4 million jobs and $121 billion in wages statewide. Job growth concentrated in natural gas production, pipelines, and energy infrastructure, anchoring communities from the Permian Basin to the Gulf Coast.

The industry delivered $27.0 billion in state and local taxes and state royalties – maintaining its position as the single largest generator of tax-like revenues per employee and paying more than seven times the tax burden of the average private-sector job.

These revenues fund Texans’ public education, transportation, public safety, and health care, and remain the primary source of new capital for the Permanent School Fund (PSF) and Permanent University Fund (PUF). Together, these endowments exceed $100 billion. With a balance of $66.5 billion, the PSF alone is larger than Harvard’s endowment and represents the largest education endowment in the nation.

In 2025, Texas’ production of crude oil, natural gas and natural gas liquids once again reached historic highs. Pipeline and LNG export capacity continued to expand, fortifying our own energy security and providing global energy stability. These achievements are not abstract – they are measurable, dependable, and essential.

This performance does not happen by chance. It reflects Texas' long-standing commitment to reliability over rhetoric and pragmatism over politics. A fair, predictable regulatory and legal framework – paired with a pro-infrastructure posture – has allowed innovation, investment, and responsible development to flourish. Policymakers recognize that science-based rules and free-market principles deliver affordable energy, a strong grid, and broad-based economic opportunity.

At a time when energy debates are often driven by competing narratives, this report focuses on facts. It underscores a simple truth: Texas runs on oil and natural gas, made possible by hundreds of thousands of skilled men and women who rise before the sun to keep our economy moving and our communities secure.

We look forward to continuing our partnership with state leaders and communities to keep Texas powered, prosperous, and prepared for what comes next.

Todd Staples President Texas Oil & Gas Association A Message from Our President | 5

In FY 2025, the Texas oil and natural gas industry paid state and local taxes and state royalties totaling

$27.0 BILLION This number equates to nearly $74 million each day.

Royalties to state funds $3.152 billion Oil/gas well servicing $0.138 billion Property taxes $8.620 billion

Production of natural gas $2.479 billion

Production of oil $5.384 billion

State franchise and other taxes $1.115 billion

6 | Energy & Economic Impact Report 2025

Sales, state and local taxes $6.106 billion

Since 2007, when TXOGA first started compiling this data, the oil and natural gas industry has paid more than a quarter of a trillion dollars in state and local taxes and state royalties.

Industry Taxes and Royalties Paid by Year billion dollars 30

25

20

15

10

5

20 23 20 24 20 25

20 22

20 21

20 19 20 20

20 17 20 18

20 16

20 15

20 14

20 13

20 11 20 12

20 07 20 08 20 09 20 10

0

When direct and indirect impacts are considered, the Texas oil and natural gas industry supported

$779 BILLION of total private sector Texas GSP in calendar year 2024 alone, the latest year for which these data are available.

Fueling the Economy | 7

A RECORD-BREAKING YEAR Fiscal Year 2025 marked a defining moment for Texas, solidifying the Lone Star State’s reputation as the beating heart of American energy.

This was a year defined not just by progress, but by a relentless series of shattered records.

The Texas oil and natural gas industry delivered unprecedented performance across the board, a testament to an industry firing on all cylinders.

Monthly records set by the oil and natural gas industry in 2025 Crude oil production

5.85

mb/d

NGL production

4.3

July 2025

LNG exports

8.9

mb/d

August 2025

Exports of crude & condensate

4.1

bcf/d

February 2025

Marketed natural gas production

mb/d

February 2025

35.4

bcf/d

August 2025

Total natural gas exports

14.2

February 2025

bcf/d

NGL direct use

1.7

mb/d

August 2025

Sources: EIA, ITC, and TXOGA Analysis | LNG exports based on ITC Texas trade districts million barrels per day (mb/d) | billion cubic feet per day (bcf/d)

8 | Energy & Economic Impact Report 2025

FUELING THE WORKFORCE Texas oil and natural gas industry jobs continue to be good for Texas as well as for the families and communities these jobs support.

Direct oil and natural gas employment plus the industry's spending on expenses such as capital goods, electricity, construction, services and supplies generate over 1.4 million jobs.

Fueling the Workforce | 9

In FY 2025, the Texas oil and natural gas industry employed

495,501 TEXANS Texas oil and natural gas employees by sector Support activities for oil and gas operations

110,612

Gasoline stations with convenience stores

81,268

Oil and gas pipeline and related structures construction

50,667

Crude petroleum extraction

49,187

Oil and gas field machinery and equipment

29,280

Pipeline transportation

23,386

Drilling oil and gas wells

22,092

Petroleum merchant wholesalers

21,476

Petrochemical manufacturing

18,190

Natural gas extraction

17,700

Petroleum refineries

17,159

Other gasoline stations

13,077

Plastics material and resin manufacturing

11,939

Other basic organic chemical manufacturing

9,042

Natural gas distribution

8,869

Industrial sand mining

3,958

Fuel dealers

3,201

Asphalt paving, roofing, and saturated materials manufacturing

2,829

Petroleum lubricating oil and grease manufacturing

1,005

Nitrogenous fertilizer manufacturing

564 Total:

10 | Energy & Economic Impact Report 2025

495,501

Every direct job in the Texas oil and natural gas industry creates approximately two additional jobs, with 1.4 million total jobs supported across the Texas economy.

Texas oil and natural gas employers paid an average of $133,095 per job in 2025—68% more than the average paid by the rest of Texas’ private sector.

$133,095 Texas oil and natural gas wages

$78,967

Other Texas private sector wages

Based on the combined state and local taxes and state royalties attributable to the industry, the oil and natural gas industry pays far more per employee than the average across all other Texas private-sector industries.

Oil & Gas taxes: $54,481 per employee

All other sectors taxes: $7,225 per employee

This 7.5X differential underscores the disproportionate role the industry plays in financing state and local government services. Since Texas’ tax system relies heavily on business activity rather than personal income taxes, public expenditure needs scale with population—students, drivers, patients, families—and employment serves as a practical proxy for population-driven costs. By this measure, the Texas oil and natural gas industry not only pays its share—it pays far more than its share, underwriting the government services upon which every Texan depends.

Fueling the Workforce | 11

FUELING PUBLIC EDUCATION The Texas oil and natural gas industry plays a significant role in funding public education in the state. Through a variety of taxes and royalties, the industry helps to provide much-needed funding for schools, teachers, and students.

This support serves as an important example of industry's contributions to the next generation of Texas leaders.

12 | Energy & Economic Impact Report 2025

Public education received a major infusion of funds in FY 2025. The Permanent University Fund received $1.72 billion and the Permanent School Fund received $1.40 billion.

Funded largely by oil and natural gas, these education endowments now exceed $100 billion. Additionally, ISDs in Texas received oil and natural property taxes totaling

$2.6 BILLION Top 10 ISDs for oil and natural gas property taxes* Pecos-Barstow-Toyah

$309.3 million

83.2% of tax base

Midland

$222.9 million

50.2% of tax base

Wink-Loving

$157.4 million

91.1% of tax base

Rankin

$118.9 million

93.5% of tax base

Andrews

$73.0 million

78.4% of tax base

Reagan County

$69.3 million

89.5% of tax base

Grady

$65.2 million

94.7% of tax base

Cotulla

$59.9 million

90.8% of tax base

Carrizo Springs

$59.7 million

87.0% of tax base

Glasscock County

$57.3 million

77.1% of tax base

*Note: "Oil and natural gas" means mineral properties producing oil and natural gas, pipelines, and gas utilities. It does not include refineries, petrochemicals, or other properties. To view all oil and natural gas property taxes paid to Texas independent school districts visit txoga.org/2025eeir.

Fueling Public Education | 13

FUELING COMMUNITIES Counties across the Lone Star State receive millions of dollars in property taxes paid by the Texas oil and natural gas industry.

This funding supports local communities and empowers them to address local needs and issues.

14 | Energy & Economic Impact Report 2025

In FY 2025, Texas counties received oil and natural gas property taxes totaling over

$1.0 BILLION Top 10 counties for oil & natural gas property taxes* Reeves

$109.4 million

84.8% of tax base

Loving

$69.0 million

95.6% of tax base

Martin

$46.3 million

94.7% of tax base

Ward

$39.1 million

79.3% of tax base

Midland

$38.4 million

48.5% of tax base

LaSalle

$35.1 million

91.2% of tax base

Upton

$33.4 million

93.5% of tax base

Pecos

$25.5 million

65.2% of tax base

Webb

$25.3 million

19.7% of tax base

Andrews

$25.1 million

83.2% of tax base

*Note: "Oil and natural gas" means mineral properties producing oil and natural gas, pipelines, and gas utilities. It does not include refineries, petrochemicals, or other properties. To view all oil and natural gas property taxes paid to Texas counties visit txoga.org/2025eeir.

Fueling Communities | 15

FUELING SAVINGS & HIGHWAYS Texans know that the oil and natural gas industry anchors our economy and directly funds our roads, schools, emergency services and our Rainy Day Fund.

This support is critical for our state, and ensures funding for our state and local governments.

16 | Energy & Economic Impact Report 2025

The Texas oil and natural gas industry is the primary funding source for the Economic Stabilization (“Rainy Day”) Fund, contributing more than

$35.9 BILLION since the Fund’s inception in 1987. This amounts to over 85 percent of the Rainy Day Fund revenue over time. Out of FY 2025’s production taxes paid, the Rainy Day Fund and the State Highway Fund each received

$2.7 BILLION

Legislators have appropriated funds from the Rainy Day Fund 117 times, the first of which was to fund public education in Texas. The sum of all appropriations totals

$18.4 BILLION

Without the direct funding from taxes paid by the Texas oil and natural gas industry, support for retired teachers, disaster recovery, healthcare services, and numerous other priority items would not have received the substantial dollars allocated to meet essential needs.

Fueling Savings & Highways | 17

Rainy Day Fund categories funded by oil & natural gas Public Education

$4.59 billion

General Revenue Fund, Economic Development, and Transportation Needs

$3.72 billion

Health, Protective Services

$2.50 billion

Water Planning and Infrastructure

$2.15 billion

Disaster Recovery

$2.10 billion

Teacher Retirement System

$1.66 billion

DPS, TDCJ, Military and Other Agency Funding

$1.19 billion

Higher Education

$0.49 billion Total: $18.4 billion

18 | Energy & Economic Impact Report 2025

Rainy Day Fund categories funded by Texas oil and natural gas General Revenue Fund, Economic Development, and Transportation Needs

Disaster Recovery DPS, TDCJ, Military & Other Agency Funding Health, Protective Services

Public Education

Teacher Retirement System Higher Education Water Planning & Infrastructure

Since FY 2015, the State Highway Fund has received nearly

$21.6 BILLION from taxes paid by the Texas oil and natural gas industry.

Fueling Savings & Highways | 19

THE INDUSTRY Texas oil and natural gas fuel modern life as we know it.

Beyond the hundreds of thousands of jobs the industry creates and billions in taxes it pays, oil and natural gas improve the economic and societal progress of communities here and around the world.

Nearly all of the products we use every day like pharmaceuticals, electronics, cosmetics and clothing are all made from oil and natural gas.

There is no reliable substitute for oil and natural gas for the products, fuels, and electricity that power modern life.

20 | Energy & Economic Impact Report 2025

AT A GLANCE Top crude oil producing nations (if Texas were a country) 1

43% crude oil 29% natural gas of total U.S. production

United States

13.6 mb/d

2 Saudi Arabia

9.3 mb/d

3 Russia

9.1 mb/d

4 Texas

5.8 mb/d

5 Canada

5.6 mb/d

6 Iraq

4.8 mb/d

7 Brazil

4.4 mb/d

8 China

4.3 mb/d

9 Iran

3.3 mb/d

10 UAE

3.1 mb/d

Top crude oil producing states 1

Texas

5.8 mb/d

2 New Mexico

2.2 mb/d

3 North Dakota

1.2 mb/d

4 Colorado

0.5 mb/d

2025 average crude oil and natural gas production

5 Alaska

0.4 mb/d

U.S. Crude Oil Production

13.6 mb/d

Top natural gas producing states

U.S. Natural Gas Marketed Production

118.4 bcf/d

Texas Crude Oil Production

5.8 mb/d

472,790

miles of Texas pipelines

33.5%

of U.S. refining capacity

1

Texas Natural Gas Marketed Production

34.5 bcf/d

Texas

34.5 bcf/d

2 Pennsylvania

21.1 bcf/d

3 Louisiana

11.1 bcf/d

4 New Mexico

10.3 bcf/d

5 West Virginia

9.8 bcf/d

Note: Data reflect 2025 calendar year averages Sources: EIA, OPEC, RRC, and TXOGA Analysis The Industry at a Glance | 21

The Big Picture Progress in Texas is powered by oil and natural gas performance.

Record-breaking production, long-term investment, continuous innovation, operational discipline, and perseverance have positioned Texas as the world’s energy leader. Sustaining that progress requires policies that build on what works.

Texas is poised to lead the development of emerging technologies, including carbon capture and storage and produced water recycling and reuse. Our industry welcomes continued regulatory progress related to innovations in these fields, as science-based, consensusdriven policies can unlock new solutions while supporting responsible development statewide.

None of these future successes are possible without infrastructure. To maintain Texas’ current trajectory, we must continue investing in pipelines, water systems, electricity generation and transmission – the critical networks that allow energy, commerce, and innovation to drive job growth, reliability, and opportunity in every region of Texas.

Texas’ success is the product of reliable performance, smart policy, and sustained partnership. Texas runs on oil and natural gas – and by building on what works, we can ensure that progress continues for every Texan, well into the future.

22 | Energy & Economic Impact Report 2025

The Big Picture | 23

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