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HomeMy WebLinkAboutAPA2353[}{j&fru�LA\ a��&®©@ Susitna Joint Venture Document Number _.2 3S- 6 � --u --- - - · Please Return To DOCUMENT CONTROL Pt'rSt1I1<.11 c;,,rr�..·spnndcnct: f!'1'n D. ;-.ugustinv HE t<' E. �!a rchq� Lm i .:\P.\ ' .. ,, l i "< ; . .:� v -� J ,'< ..• •> ,�:, ., " u IAIZA\•fMICI susiTNA JOINT VENruRE G=U&OO�&!:] §rn3&@©@ Susitna Joint Venture Document Number ;t3S3 Please Return To DOCUMENT CONTROL lhsign Offic.: 40fJ-If2rlt Awnu•, NE B.O..,tttt, Washington .., Tel. l:tltll Ut-4500 M•in Offb : B14D #Nrtztt/1 R011d Anchor •• A�Mtc• 99501 TM. (9011 �� June 21, 1983 Mr. Eric Marchegiani Alaska Power Authority 334 West 5th Avenue Anchorage, Alaska 99501 Subject: Natural Gas Wellhead Severance Taxes Dear Mr. Marchegiani: Attached is a copy of Alaska S t atu t es , Chapter 55. Oil and Gas Pro­ perties Production tax. The section that specifies natural gas severance taxes is Section 43.55.016. The minimum tax would be 6.4¢/Mcf while the maximum is 10% of th e wellhead price. Actual taxes could be somewhere in between because the 10% quantity is multiplied by the "economic limit factor11 describ e d in Section 43.55.013. At this time it is impossible to obtain the values needed to solve the eco nomic limit factor for the new Enstar gas contracts since none of the wells covered by those contracts are currently producing. Bill Hickman of Enstar said they are currently paying about 11¢/MCf on gas purchased from Beaver Creek and that the 11¢/Mcf was about 4% of the wellhead price. Charles Logsdon of the DOR said his rough guess would be ab out 7% of the wellhead price for the new Enstar contracts (0.07 x 2.32/Mcf = 16¢/Mcf). Based on this information, I have assumed that th e severance tax is 15¢/Mcf for new Cook Inlet gas and that the tax will increase or de­ crease as the gas pri.ce chan ges with world oil prices. If you have any questions conce rning this matter, please call me. WDA/kdn Attachments: as noted cc: Robert Mohn., APA Henry H. Chen, HE Ned Lesnick, HE W. David Augustine • .. �. "' ., j � .. § 43.55.010 ALASKA STATUTES ' tt\f8..tt1. .":•;·:. � • n-'"-�. Chapter 55. Oil and Gas Properties Produrtlnn T•s,t: . Section 10. [Repealed] 11. Oil production tax 12. Adjustment in tax rates 13. Economic limit factor 15. [Repealed] 16. Gas production tax 17. Relation to other taxes 18. Credit aga ins t tax 20. Payment of tax 30. �'iling of statements 40. Powers of D epartment of Revenue 50. Incorrect returns Section 60. Delinquency 70. [Repealed) . 80. Collection nml drJn&.l\ t4 �t411;• 90. Refunds 100. [Rep£'a!C(t] 110. Administrntion 120. N oncomplinnt'l' 1!-lO. False rcporl conatSt� J�·f't • 135. Mca';urcmt'lll UO. Definitions 150. Delet·minnlion (If r:mt.t '1'1\il* Sec. 43.55.010. Gross production tax. Repealed by § 9 ch 136 SLA 197'7. · p1 .. 92·203, 85 Stat. 688, 43 U.S.C. 160l.et seq.), that payment shall be "'"Jess than $.05 for each taxable barrel of oil produced until all llttl:OUnts paid in the fund equal $500,000,000. (§ 1 ch 136 SLA 1977) (rtt• reference.-As to oil and gas, see J.i �' 1)5.180. Uilor·� note.-Section 10, ch. 136, SLA r. rrtwides, in subsection (b): ''If a court .t �prlc: :. jurisdiction invali dates the lrt•�nlial cent.s·per·barrel amounts set � In AS 43.55.0ll(c), th en the '*�'" f"'' barrel amount under that section :h1 tlf $0.80 per barrel for all crude oil." Section 11, ch. 136, SLA 1977, effective July 1, 1977, pnwides: "This Act applt<:s to production during the month of Julv, urn and succeedin;.:-months." " · f�gislative committee report. -For report on ch. l!JG, SLA HJ77 (HCSCSSB 238), see ln77 Hous e Journ:ll, p. 1248. Am. Jur. reference. -51 Am .. Jur., Taxation, §§ 431;, 439, 12TJ9. !ott. ·t:t5.5.012. Adjustment in tax rates. (a) Before Jrnuary 1 of each 7u.the department shall review the prices received for crude oil or gas f!·�·rccd in Alaska, the value of that oil or gas, and the general level Jo�ditor's note. - T h e repealed s ectio n derived from§ 2, ch. 'l, ESLA 1955; § 1, ch. 110, SLA 1968; § 1, ch. 247, SLA 1970; §§ 1 -3, ch. 101, SLA 1972; § 49, ch. 53, SLA 1!173; § 1, ch. 4, FSSLA 1973; § 2, ch. 159, SLA 1975. · J ftiecs ::� Alaska and th e nation; and submit a written report of this . �.,. to the govern or with the department's recommendations for Legislath·e rnmtttiU,. ,..,._"" ,,. ·,11-•-w. · • th · report on ch. z.n. �t.A 1,7t<��;r. ... )>,hf ��,. � ,� :H-.t.•1""S 1:: e amounts set out m §§ ll(c) and 16(c) of this chapter. The · am Sl . .st'<' wnn !lou...- J · - . - ' " ' " ' • " " ' ! : ! - 1 -ill" gt'Jtmor shall, within 30 days of receiving the department's report, report on ch. tclt. SI..A iP'I·,f�"·'if "'"''"' .,,.-"'_ �mit the proposed changes to the amounts in §§ ll(c) and 16(c) of H cssn HiS), 1\('l' Hli 1 Jl f'tiN' ;,....""•14 �.. bt. h t t th 1 • 1 t 963. For rc(lort on rh. r.:t. M�' '�; i")l'��· , . t np cr o e eg1s a ure. Section 11, ch. 136, SLA 1977, provides: ''This Act applies to production during the m o n t h of July. :97'7 and succeeding months." 382), see t!Jn Hou11r J<riJf'fit.\ lii· ,w. :ti:.a-. �J The cents-per-barrel am ount set out in § ll(c) of this chap ter as ���ltrd by (a) of this s ectio n applies to oil of 27 d egre e s API gravity. .lzttach <bgree of API gravity less than 27 degrees the cents-per-barrel �!-?Jnt shall be reduced by $.005 and for each degree of API gravity �''"r than 27 degrees the cents-per-barrel amount shall be increased '¥ I 005 except that oil above 40 degrees API gravity shall be taxed a� ';} !frrcc oil. In applying the gravi ty adjustment under this subsection, ��kmal degrees of API gravity shall be disregarded. (§ 1 ch 136 SLA :�, Sec. 43.55.01 1. Oil production t.ax. (a} There is lf\·kotJ -ll.Q•ht. ·t�� producer of oil a tax for all oil produced from each l<:•Rt�t .f)f l"··��'t �} . the sta te, less any oB the owners h ip or right to which iN _.�..,nu� ���Ji.\;· ·: . :�. taxation. The tax is equal to either the percentngc-o(·\'l.htt 4Jl�;·i>l'"1?· . � , calculated unde r (b) of this sec ti on or the ccnlA·p.-.r hurd l,M"'f++ · \. calculated under (c) of this section, whiche\·er is grt�nttr. n\111tt)\t�d' �t­ the economic limit factor determin�d for the oil production ,4 Ut� M11w� or p rop erty under§ 13 of this chtlpter. If the amounts raiC"'J.bi'��·•'���· : (b) and (c) of this section are P�flml, the amount caJcuJlltl'<l :.'1•�'!1 -lh � · ? this section shall be treated as if it were the grcntcr for pur;•!�� d·tift� · ·. �� . ' section. (b) The percentage-of-value amount eq ua1s . 12.25 per «nt � �tt ����· · value at the point of production of taxable ml producro (tt\lSi !t.-��· or property. · · i ·:.� · (c) The cents-per-barrel amount equals $0.60 per hnrrd o! \l-Mh� �4; crude oil produced fr·om the ]ease or property, nnd $0.� l�f ����t-.. � h J i) f�l �;..,�. �· . all other taxable oil pro d uce d from t .. e ease or pro ' .,� . a·dJ'usted by § 12 of this chapter. ., , · . � ..ji� • (d) 'Vhen the cents-per-barrel amount calculntcd u�4'1' �lr �� l'f'l i f 1 t ca)!"'.J.,�W{,� .�uv.>� .. , section is greater than the percentage�o -va ue mnoun � .. i! ·it�· ... � (b) of this section, and payment by the state to �he A]n!\kl • �1',,. "' · · · out of the state's royalties on that oil is re�mrccl .umfn Utf.. sharing provisions of§ 9 of t.he Alaska Nat1YC Ctnt 1.ft) • I 1 t.Mnr·� no! e.-Section ll, ch. VJG, SLA produc:tion durir�� Lh(• month of .J u ly, 1!)77 r� pro\·irics ; "This Acl applies to and succeeding :nvnth::s." I -'fct. 13.55.0138 Economic limit factor. (a) The economic limit factor it c.ld crude oil production of a lease or property equals on e minus the !lf:l) fJ( the monthly production rate at the economic limit to the "*!uction during the month for which the tax is to be pajd. �i The c�onomic limit factor for oi l p ro duc tion of a lea se or property �iff than old crude oil equals: (1-[PEL/TPJ) exp ([460 X WD]/PEL} .-,a�; PEL = the monthly production r;1tc at t h(� ('conomic limit; 'fP = total produc1t�ion during Uu� month for which the tax is to be paid; WI; = the total number of well days in the month for which . the tax fs to be paid; and �� '' • • �,.J;rh . exp mdtcates that the expression following it . . .. n exponent. • ? • • .. • • • ... ' . . . ' . . . . .. . (c) The economic limit factor for gas produc tion of a lcn11e or l'(��,�f. lllr..,mic limit for eac h lease or propert� in. t �e state �or th at year. The equals one minus the ratio of the monthly producth.m l'ltt 44 f'� · .. ·., . production rate at the econom1c bmxt for a lease or property economic 1imit to the production during the month for whic:h tlttl&��,41 , .�. · · . be de termined at a formal hearing under AS 48.05.240 and must to be paid. ; · · '• . C'ttnblished by clear and convincing eviden ce presented by the (d) The monthly production rate at the economic limit (or • �� 1� �!':\)'Cr at th at hearing. The monthly production rate at the economic property is presumed to be 300 barrels times the numb�r or .,..��t -c'U.z'�� : ·'.· .. ·�for the lease or property based upon the clear and conv incing for the l ease or property during the month for w hich the tAl t. !.l1 �� · · ·t•�oea of the taxpayer shall be calculated by divi din g the value paid. The taxpayer may rebut this pr esumptio n r,t n £orm1l lm;;Vthtl · t(Jrmined u1der (i) of this section into the average monthly direct under AS 43.05.240 by providing clear and convincing f!\·ld«Wt .,)t � . . .�: ttrr�ting cost determined un der (h) of this se�tion. different monthly production rate at the econo mic limit for tM �� � : · -�: !b) The ave:.·age mo nthly direct operating cost for gas p roduction property. The hearing shall be held before Feb rua ry 15 or t� .)'��� :tl; . :� :.· �tions of the lease or property shaU be determined based on a period within six m o nths after commencement of oil production for • �£tn. ttl . .;�. �: JIIJt Jess than four consecutive months . •rhe direct operating costs property. The monthly production rate at the economic limit for�� k�t: ::... ·. $�P.J� only royalty, pr9duction supplies, purchased fuel, routine or property bas ed upon the clear and convincing C\'idcmc-.P t·� .;tU; tt'i!tenance, and wages and benefits of em pl oyee s working on the taxpayer shall be calculated by di vi ding the value del<'rmin("(l etelttv -Cit �hction operations. Additional direct operating costs not liste d in this of this section into the average mon thly direct operating co�\ tlt't•'f'-'h'h'-4\ �.hn may be included only after their inclusion in a regu latio n adopted under (e) of this section and shall be used for purpose� of dn• ... ttt1i•lil · �� department. The direct op erati ng costs do not include capital for all oil production during that cale ndar year from u� ),,�,.. �·, . �itures, tang ible or intangible dril ling expenses, costs of well property. , . .M.,,·crs, costs for replacement or repairs (other than routi ne (e) 'rhe average monthly direct operating cost for oil ���!11i.J'lilt11 , :.\lat«!nance), deprec iatio n or amortization, taxes, in s urance, ove rh ead, operations of the lease or prop e rty shall be d:t.ermincd hn�l"tl M • jtr�t· .. !!l: · · · :::ur paid or set aside (or booked as being paid or set aside) to cover of not less tha n fo ur �consecutive months. The direct <'1�.-..t�ll ��·t�. :'· ;, .. f:t�t of terminating the gas production operations of the lease or include only royalty, production supplies, purcha�ed (uc-t. t-LttrHI;1' � • � y, or any other cost not directly related to the gas p roducti on maintenance, and wages and benefits of employees wor� lrG£ <1ft• "��-. ·: ; trntions of the lease or property. pro duction operations. Ad ditiona l direct operating cos La; not liH•�4 at�U� · ;, · · Q For the purpose of calculating the economic limit, the value at the section may be included only after their inclusion in a rcgulrtt� !tdnJf��· · ··.:' · · �itt( of production of gas produced from the lease or property s hal l be by the dep artment. The direct operating costs do not indu�!� (1Uij;J.: :. , ¥%mined on the basis of the highest pr ice paid for gas of like quality expenditures, tangible or in tangi ble drilling expen�e�t, ro•u d .f"� . ·�: rressu re in the same field. workovers, costs for replacement or repairs (other th�t-J rnltflin-· ·• · maintenance), depreciation or amortization, taxrs, in�urnoc..-, !�,..,;�. l) The department may aggregate two or more leases or prope rties money paid or set aside (or booked as being paid or SPl su �! w �V\W 1 ;�tions of them), for pu rpose s of determin in g economic l imit factors the cost of termina ti ng the oil production operations or ,.., la� ·.W: ;., , . ilf«r this sec tion and applying them to § 11 or § 16 of this chapter, property, or any other cost not directly related to the oil ��"tll•�•� ; ;'· �!i «'onomically interdependent oil or gas production operations are operations of the lease or property. � · �. r'··, wnfined to a single lease or property. The depa r tm ent may also (f) For the purpo se of calculating the eco no m ic limit. thfl nl\1# ti\ ��;;.· : �: ta a lease or property into two or mo re parts, for purposes of point of production of oil produce d from the lease or pros��tttf ti\�1! b :' ·;· . iunnining economic limit factors under th i s section and applying t hem determined on the basis of the acquisition cost C.i.l". at W�4 b�; · ,;.� :d!t § 11 or § 16 of this chapter, when two or more economically refineries for im port e d oil of like quali ty , minus the r�'no;ont�V.,. �l d· : • •. ' · dent oi! or gas production operations are being conducted on it, transportation between the poi nt of production of the oil{� dtt· �lfitJ' { .:': · '�tn old crude oil is produced from the same leaEe or proper ty as or property and those West Coast refineries. : 1>il. (g) Before February 15 of eac h year or within Iii� rr)M.t,� -ti�� · ;., A determination of the mon thly product.ion rate at the economic commencement of production for a lease or properly. th� t��� ... ��r�-P� for n lease or property is retroactive to January 1 of the current shall notify the prod ucer of ,gas of the monthl y production n-�" t!li �� �. ff)r production of a lease or property commencing after J anu ary 1lat determination of the monthly production rate at the economic limit I tlial JeasP or prop er ty made within six months after the '�ncement of produc tion is retroactive to the commenceme nt of 144 (§ 1 ch 136 SLA 1977) . � � .,, 145 I I . " .. . . . . . . " , • • .. 4 lib .. ' • ' ' • ' t � ' � I I • • .-.• I • I ,; ' � ..., • Editor's note.-Section 10, ch. 136, SLA 1977, provides, in subsection (a): 111f a court of competent jurisdiction invalidates the differential economic limit factor computation under AS 43.55.013(a) and (b), the economic limit factor contained in (b) of that section shall be U�('d fnt r-:-,�1\n.t�� of the economic limit for All M1 .. Section 11, ch. ta6, SLA Hm. tt" ... 1#S���< "This Act. applies to prrnlurt¥!1'\ •li''t•f t-�1• month of July, 19i'7 M•l .,.,.""t� months." Sec. 43.55.015. Tax per barrel of oil. Repealed by § 9 ch 136 SLA 1977. Editor's note. -The repealed section derived from § 4, ch. 101, SLA 1972; § 2, ch. 4. FSSLA Ul73. Section 11, ch. 136, SLA 1977, provides: "This Act applies to production during the month of July, 1\9i7 i\11'1 tu��.e�,t months." · Legislative eommittl'E r•prtt\ ·• •·�'· report on ch. 101, SLA l!l7lll tn ti'�'-'1 168), see 1972 Houl-ie Jnurxnl. r �:: Sec. 43.55.016. Gas production tax. (a) There is lc\'it\d uvt·· ��� producer of gas a tax for all gas produced from each lca!'o or ,.,. J41""'f in the state, less any gas the ownership or right to which is �'Ht"'1' ••l!lt· taxation. The tax is equal to either the percentage:-of-\'nlut-� �.p�n� calculated under (b) of this section or the cents-pcr·�fc( u,n,li(t( calculated under (c) of this section, whichever is greater, multjl��� 1� the economic limit factor determ i ned for gas production .of th� ka.!it u1 property under§ 13 of this ch�pter. If the amounts calcul:\tl'ft t�•,&r" 1"l� and (c) of this section are equal, the amount calculated unrt�'r (l·l nf �-� section shall be treated as if it were the greater for JHtrJK,.� •4 �'� section. " (b) The percentage--of-value amount equals 10 per rent of d.t r�fu�� value at the point of production of the taxable gas procltat.·t•4! ft�ttr "�;\ lease or p roper ty. , ,.. (c) The cents·per-Mcf amount equals $.064 per thousand cut.,r fr_.ot •j· taxable gas produced from the lease or property as adjust•-.t lr}' i H �� this chapter. {§ 1 ch 136 SLA 1977) Editor's note.-Section 11, ch .. 136, SLA 1977 � provides: (jThis Act applies to production during thl' mt•rtJ\ tl. �•1\A 1fi',?· and succeeding month� .... Sec. 43.55.017. Relation to other taxe�. (a) Except ns Pr;>'-itlt-4 It; �;.\t­ chapter and in ch. 58 of this title, the tax6s imposed b�! thtF c��,��iteli · in place of all taxes now imposed by the state or any of Jl.'! muntc.,.tt.\ � .. and neither the state nor a municipality may i m p ose a tnx uf•t't (1) producing oil or gas leases; (2) oil or gas p roduced or extracted in the state; {3) the value of intangible drilling and exploration c�1wn•t"f. ... • 1 r 11 t.ntd a··t!l� (b) The taxes imposed by this -chapter are m p ace o a . � � · ·. by a municipa1ity upon oil or gas in plac� or nonproducJrt .. u. ·� � leases or properties. ... � '11.1;.� .. •"* .... ...... ...., . :�� I tl).t)\J,V.J.O · �.l:·� (r) The taxes imposed by this chapter are not in place of th ·. -��·�posed by ch. 57 of this title or income taxes, franchise taxes or· ·, ·:�� tf'ln the retail sale of oil or gas products. (§ 1 ch 136 SLA 1977: i�J [c!itnr's note.-Section 11, ch. 136, SLA prod action during the month of Jul) · · .,:.! �o:r 11rovides: "This Act applies to and succeedinrr months." .. 'til .. ,... y ,.. • � ,t : ·.�ii. '�-i ··i. �-.,i.t'l. , .. .t . . -"· -� j. � :�:. -. ;� : ,;.� ',· �·:l 5f!c. 43.55.018. Credit against tax. (a) There shall be allowed trt�Ht against the taxes levied under this chapter for a lease or pro} �� Mrly development incen ti ve credit accrued for that lease or pro1 vtier AS 43.58.180. In no event may the credit allowed for a lea Jtli{l('rty exceed 50 per cent of the taxes levied under this chapte �·•t lease or property. Ill) The credit shall be allowed on a monthly basis. (§ 2 ch 159 l !f••) •1• ;> Fditnr•s note.- Section 8, ch. 159, SLA �·· l">ntains a severc1bility clause. �·7titm 9. ch. 159, SLA 1975, effective },,ot tfi, 1975, pro vides: 11 AS 43.58.030, &1 '.A 1�0. nnd AS 43.55.018 are included in t1'11 \r.t so as to avoid double taxation of � ·�rne interest in oil and gas and as an �"'tire for the early production of oil and 1111 di\r>•\'Crcd in the state. The legislature ilrltt\tto; that the .inclusion of these sections granting tax crediL<> dot'S not. in any m chanh<' the intent, .,·alidily or enforce: of thC' basic ad valorem t.ax irrtpo�:ed l Act.. If the inclusion of lhe::..e s<: results in a j ud icia l decision that t valci'em tax imposed by AS 43.f:8.( • invahd, these sections shall be void a no eifect whatsoever and the Act sh read as if these sections had never included." �e. ·t3.55�020. Payment of tax. (a) The gross production tax o !1 r:t� shall be paid monthly. The tax is due on the 20th day of 1 n\.-nrlar month on oil or gas produced from each lease .or prop ��tin� the preceding month. If the tax is not paid before the end oj t-r.-nth in which it becomes due, the tax becomes delinquent. 'N The gross production tax on oil or gas shall be paid by or on be I[ th� prodUCCl"'. / . k) Hepealed by § 7 ch 101 SLA 1972, effective Jnly 1, 1972. �f) In making settlement with the royalty owner the producer ; �tu'=t the amount of the tax paid on royalty o il or gas, or may det fi1Jlty oil or gas equivalent in value at lhe time the tax becomes �f.) th� amount of the tax paid. ft} Gas produced in �xcess of that needed for safety purposes, ex< f.ita lll"�d in the operation of a lease or property in drilling fm 1r.-iudng oil or gas, or for repressuring, iB con:.;idercd, for the pur� I! thi" ch apter and in the amount used, a:� I{H�-t produced from a Ie : f'r:'lp!!rty. Gas flared beyond the amou11L authorized for safety by witt•artmcnt of Natural ReHources under AS 31.05.170(ll)(H) ��Midr.'rcd as gas produced, except that it is subject to a penalty eq t:,tilf! tax computed under § 16 of this chapter as adjusted by § 12 · . . 1m chapter per thousand cubic feet of gas for tJ.te month in which · •·as flared. • • • • • ' � • • -1 • ..... • ... ' -· ' . • . • • • • • < • . . . . � � ·--:��:�·�.·.;��-1·�)5150 l(EVENUE AND TAXATION § 43.55.140 ALASKA STATUTES . { l�mih!•. :::it� ,. . .. . . : ·. ·;,f�:( �·��� gas if sold in an arm's length transaction or, in the abse�ce. of (A) a mmeral m�erest. . . ::. · ·.:·�!� rt �"t'l\·1 length transaction, is the sum of the value of th.e hqmds (B) a leasehold mterest, ·· · .. � ·.::·�:� i�td from the gas at the plant and the value of the res1due gas, (C) a _working interest, ro�al�y interest, o\·crritlinl( n>)"Uj ,in�i , )if!;' a rmonable allowan ce for processing �e gas at �he plant and for produc t�on �a!'"ent, net prof1t mterest or any ot�rr inltf<'l<l!ll.,t '"'"'' ;, , �: �rting the gas to the plant from the pomt where 1t was accurately con cess ton. Jomt venture. or other agreement for 011 nnd r�• n�tli�'Wiilt\t . ; ·�::f.�� or measured; . . . . development ?r p:oductlon. . . . : . . : .. ,:�1 ·� •'oil prouuction operation" means the operat�on by. wh1c� 011. 1s (D) a •,vorkmg mterest, royalty mterest, overruling ror'-'!l ifl�����. , · .. ·�!J: .i'/l\l'tf1'<1 from a lease or property and rendered mto o1l of p1pelme production paym:�t, �et profit !nterest or any o:h�r !!tt+•.,.l il!· ,11;, �-:.;� <:��lt.f, �nd h._clude� a�y gath;ring done before the oil is finally agreement for umtlzatlon or poohng under the pro\'l�lon• t.-4 � ll'ii!it : .r.; �Afr(il mlo otl of p1pelme quahty; (3} of the Internal Revenue Code of 1954 as defined on thct t.f!P\"i�i t,.tt� � � ·;,,� ttJ •'pipeline quality., means good and merchantable condition; . of this paragraph; · .. :�!� \Ji "well days" means. the number of days in which a well IS (9) .. ownership or right to which is exempt from t!luHt�· tfi>1'14!/ihi-1( '·';,':.� ��g during a month;i ownership interest of the federal governme n t or the autJr. . ! . · :· � llll ••old crude oil" means crude oil production classified as "old crude n Ol Repealed by § 9 ch 136 SLA 1977. . . .. .. , ':f\ ( i!.lO CFR Chapter II. Part 212-72 on May 1, 19�7, and which is �!so (11) Repealed by§ 9 ch 136 SLA 1977� .. �· :.;�,� i��!� ns "old crude ml" on th e date of production. (§ 1 ch 7 ESLA !12) "gross >alue at the point of production" . :. '·���am § 17 ch 1�1 SLA 1972; am§ 3 ch 4 FSSLA 1973; am§ 4 ch (..-\) for oil, the value of the oil at the point wh<'� it u 1l\lH"'�i '·�� · .·;.(:; �L\ 1975; am §§ 7, 9 ch 136 SLA 1977) measured (by automatic custody transfer meter, tnnk ru·�..; >ttl ��._.. : ��·�" rth. t d . 'rh 1973 s •t.' 11 h 13<' SI A 1n .. ,.,., pro•·1'clcs· b . . ) . I' . r •l.· • : ·:� .,.., Ill nmcn mcnts. -e ec lOn . , c . I, J i11 I • • • method appr?ved y the commtss10ner m a COn< ltiO� � r�*J·llt� �.\.�lt7 . :.�:.:� �"""t 111!f!f'd paragraphs (6) -(11). "This Act. applies to p�·oduct.\on during �h(! on the premtses of the lease or property from wh:�n 1\ wt ��f4\Wi>�' ,:'l":J:� � �r.!. auwntlment. rewrote paragraph month of .July, l!lr7 and succ(!cdmg f.'"•\\ e�:er. if the on i5 not of pipeline quality WI1P1l it h , .. ��·· t•:' "-•h y �tl ••• :.-��. �. month_:;!' . . ., . · f h' h · · . A � .. F ;(:. . ..; ·�.. 19i7 amendment repealed Legxslabve commtttee report. -For 1-'�ermses of the lease or prop erty rom. w tc_ tl •� r�u'l"'' � ... ;'1.' · :� ¥�.�'\f''V�� on) and {1 �}. which de!ined report on:�· 101, SLA 1972 (l"CCS I;ICSSB {)l.i recovered from a lease or property 15 not metrr�! or �tt·S.�t11",. h.r .· · hi_����; .. ...: and "production/' respectlvely. 168), sec �.,.2 House Journal, p. 963. a·1tomatic custody transfer meter, tank gauge. t'r tt\llut �:ll'�:-tt : .: '�£ � . ..-J� r:�ra�raph!; (�2) through (16). approYed by the commissioner) on the premises of th� kl;t.r �� ��·illl.i·�>�;: ·. · )l �.��;:� ;,��.����t.;·c���;!.9· SLA from which it is recovered, then the gross \'nlu<t a\ Ulf f.r.·..,i' %•·. :. · ... �. r:roduction is the value of that oil at the off-premisc!l »"1tJ:tl • .,;i.�>:t.· ?t�· · . : \lt. U.55.l50. Determination of gross 'Value. (a) For the purposes �il is first metered or measured (by automatic cur.todj' Ulctw*•.� �ll:>�·,� . •.· �� cbnpler, the gross value shall be calculated using the reasonable tank gauge, or other metho d approved by the corr.r:-\�ttitflr..i!i· f,;,lt .:;. �of transportation of the oil or gas. The reasonable costs of condition of pipeline quality; · ·.: \ t�;1· · · tion shall be the actual costs, except tB) for gas recovered from or in association ,,.·ilh oil.tttt tr;1�.�� .. � � ;.:. gas at the p oint where it is accura tely metered or 11d1io•i.� ,jf.,>�'. :-X It •htn the parties to the transportation of oil or �;as are affiliated; separation from the oil; for gas run through a gas p��.:nt£�r!t's4-=�:�; ... : {) 'lh('n the contract for the transportation of oil or gas is not an f,'TOSS ,·aiue at the point of p rod uct ion is th� full-.onaldtnwq•fli��:;1: · lrnglh transaction or is not representative of the market value by the producer for the gas if sold in an arm's lcugth f.nJtbll�-��.f� ,�; lransp0rtation; the absence of an arm's length transaction, is the sum of �\sr rtlfi� ... � 'f � •h('n the method of transportation of oil or gas is not reasonable the liquids extracted from the gas at th? plant nnd t� t'tt'\!1·. �::' :: �or existing alternative methods of transportation. residue gas less a reasonable allowance ior procertl'in. tin jyJt � ;Lll � �. J1 i' h d f' d th d' · · ( ) (1) (2) d (3) Plant and f�r transporting the gas to the plant from lht �1� .� .• � .. • · · · • t e .. epa.rtment -m s that e con tiaons m ;t ' ' an I · · �cction are present, t.he department slw.ll determine the which the oil production operation is conductP.d; nn' 1 J. �: . h � t1 · �"'·{;, · btc costs of transportation, using the fair matket ,·alue of like (C) for gas not.recovered. f�om or in as 1 socia�ion ( r�� ff�hh:.r �,�. !\�� , .·:..r;-��···� .• ,..._. tion, the fair market value of equally efficient and available the gas at the pomt where 1t 15 �r, urate Y me cr" . j,,:. � .. Jl ' . mc::les of transportation, or other reasonable methods. value of the gas at the poi n t of sale, it au)', on the P"'f!J� 1: � .; · ion costs fixed by tariff rates properly on file with the or property from which the gas is recovered, whu·h<!fff lt tltt . l)ipcline Commission or other regulatory agencv s h all be value; for gas run i:hrough a gas processing phm4 tht-prima facie reasonable. (§ 6 ch 107 SLA 1976) the point of production is the ru.ll co.n�s�·��---�