TomCo Energy PLC (AIM:TOM) told investors that Greenfield Energy LLC, its wholly owned subsidiary, has been awarded a 10-year marginal tax relief.
The tax reduction could be worth up to US$76.3mln, it said in a statement.
It noted that the benefit is the result of an investment incentive in Utah. In return for investing and creating jobs in the region, the company may receive up to 50% of the state taxes over a ten year period.
“We are excited to see Greenfield’s growth plans in the Uintah Basin,” said Utah Office of Economic Opportunity’s executive director Dan Hemmert.
“Energy Independence has never been more important to the nation, and we are proud to support this venture which will provide significant investment into rural Utah.
“We are also pleased to see the planned application of innovative processes, aggressive carbon sequestration, and efforts to be carbon neutral – from well to tailpipe.”
TomCo chief executive John Potter, meanwhile, added: “The amount of local support we have received in advancing our project to date has been outstanding and I would like to thank everyone involved.
“We believe our proposed development project in Uintah County is based on an exceptional deposit with tremendous potential.
“We continue to make good progress with our plans for the TSHII site and continue to advance the previously announced due diligence exercise being undertaken by a potential financing party currently interested in backing our plans for Greenfield.
“We look forward to providing further updates in due course.”
The tax credit system is an EDTIF (Economic Development Tax Increment Financing) program, run by the Utah Legislature.
Each year that Greenfield meets the criteria in its contract with the state and new incremental state taxes have been receipted and verified, it will qualify for a portion of the total tax credit, up to the aggregate cap of US$76.3mln over the ten-year period.
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