The Texas oil and natural gas industry paid $27.0 billion in state and local taxes and state royalties during fiscal year 2025, according to newly released data from the Texas Oil & Gas Association (TXOGA). The total represents the second-highest annual contribution in state history.
TXOGA President Todd Staples presented the findings during a media briefing tied to the association’s annual Energy & Economic Impact Report, outlining the industry’s economic role, environmental performance, and policy priorities.
“In Texas, lasting progress is built on performance, not opinion,” Staples said. “Even during a year dominated by market challenges, Texas oil and natural gas has proven—once again—to be the power behind Texas’ progress.”
Funding Public Services Across Texas
According to TXOGA, the $27 billion in revenue equates to nearly $74 million per day flowing to state and local governments. These funds support public schools, universities, transportation infrastructure, first responders, and other essential services.
Since 2007, when TXOGA began tracking these figures, the industry has contributed more than $250 billion in taxes and royalties. This total does not include payroll, property taxes, or indirect economic impacts tied to energy-sector activity.
Major Support for Education
Public education continued to be a major beneficiary in FY 2025. Oil and natural gas royalties generated:
$1.72 billion for the Permanent University Fund $1.40 billion for the Permanent School Fund
Together, the two funds now exceed $100 billion in market value. The Permanent School Fund alone holds $66.5 billion, making it the largest educational endowment in the nation.
Strengthening the Rainy Day Fund and Infrastructure
The state’s Economic Stabilization Fund, commonly known as the Rainy Day Fund, has received more than $35.9 billion from oil and gas production taxes since its creation in 1987. This accounts for over 85 percent of its historical revenue.
During the most recent cycle, both the Rainy Day Fund and the State Highway Fund received $2.7 billion from industry-related taxes.
Industry Outlook
TXOGA officials said the FY 2025 figures reflect continued investment and operational performance, despite market volatility. Staples emphasized the industry’s role in job creation, energy security, and economic stability.
“Action, investment, and innovation drive greatness across the Texas economy,” he said. “Texas oil and natural gas delivers energy security at home and stability for our allies abroad.”
The association’s annual report also highlights record operational and environmental performance and outlines policy priorities for the coming year.
With billions continuing to flow into public education, infrastructure, and state reserves, TXOGA leaders say the industry remains a central pillar of Texas’ economic foundation.
