Oil & Gas R&D Credit

The R&D Tax Credit is a powerful incentive designed specifically for the work the oil & gas industry does every day. It rewards the complex geological, chemical, and mechanical problem-solving inherent in exploration, production, and refining, turning your firm's innovation into a significant tax refund.

Eligibility doesn’t require discovering a new oil field. Instead, the credit rewards your process of systematic trial-and-error to arrive at a final, optimized solution. If your team experimented with different drilling methods, fluid compositions, or processing techniques to resolve technical uncertainty and improve efficiency, safety, or yield, you were likely performing qualifying R&D.

Qualifying activities are present throughout the entire operational lifecycle:

Upstream: Exploration & Production
This foundational stage involves the science of finding and extracting resources.

Developing or improving proprietary reservoir simulation software or seismic data processing algorithms to identify new reserves.
Engineering and testing new directional drilling techniques, downhole tools, or MWD/LWD (Logging While Drilling) systems.
Experimenting with new Enhanced Oil Recovery (EOR) techniques, including novel chemical floods, gas injection methods, or frac fluid compositions.

Midstream & Downstream: Processing & Refining
This phase focuses on engineering new ways to safely move, separate, and convert raw hydrocarbons.

Developing and testing new catalysts or reaction parameters in the refining process (e.g., catalytic cracking, hydrodesulfurization) to improve the yield of high-value fuels.
Experimenting with new chemical inhibitor formulations to prevent corrosion or hydrate formation in pipelines (flow assurance).
Designing and prototyping new processes for gas separation, such as removing H2S, CO2, or other impurities to meet sales gas specifications.

Environmental & Safety Engineering
The technical work required to meet and exceed modern environmental and safety standards.

Developing and testing new Carbon Capture, Utilization, and Storage (CCUS) technologies to reduce or sequester CO2 emissions.
Engineering and prototyping new water treatment and recycling processes for produced water or hydraulic fracturing flowback.
Designing and testing new safety equipment, pipeline integrity (smart pig) tools, or corrosion-resistant alloys for harsh service environments.

From the reservoir to the refinery, the oil & gas lifecycle is filled with qualifying activities that can translate into valuable tax savings.