Section 43.55.150. Determination of gross value at the point of production.

   (a) For the purposes of AS 43.55.011 - 43.55.180, the gross value at the point of production is calculated using the actual costs of transportation of the oil or gas, except when the
        (1) shipper of oil or gas is affiliated with the transportation carrier or with a person that owns an interest in the transportation facility;
        (2) contract for the transportation of oil or gas is not an arm's length transaction; or
        (3) method or terms of transportation of oil or gas are not reasonable in view of existing alternative transportation options.
   (b) If the department finds that a condition in (a)(1), (2), or (3) of this section is present, the gross value at the point of production is calculated using the actual costs of transportation, or the reasonable costs of transportation as determined under this subsection, whichever is lower. The department shall determine the reasonable costs of transportation, using the fair market value of like transportation, the fair market value of equally efficient and available alternative modes of transportation, or other reasonable methods. Transportation costs fixed by tariff rates that have been adjudicated as just and reasonable by the Regulatory Commission of Alaska or another regulatory agency and transportation costs in an arm's length transaction paid by parties not affiliated with an owner of the method of transportation shall be considered prima facie reasonable.
   (c) In determining the gross value of oil under this section, the department may not allow as reasonable costs of transportation
        (1) the amount of loss of or damage to, or of expense incurred due to the loss of or damage to, a vessel used to transport oil if the loss, damage, or expense is incurred in connection with a catastrophic oil discharge from the vessel into the marine or inland waters of the state;
        (2) the incremental costs of transportation of the oil that are attributable to temporary use of or chartered or substituted service provided by another vessel due to the loss of or damage to a vessel regularly used to transport oil and that are incurred in connection with a catastrophic oil discharge into the marine or inland waters of the state; and
        (3) the costs incurred to charter, contract, or hire vessels and equipment used to contain or clean up a catastrophic oil discharge.

Authorities

43.55.160

Notes

Recent Bills that will modify this

HB5005 TAX;CREDITS;PMTS;INTEREST;LEASE;O & G
SB5005 TAX;CREDITS;PMTS;INTEREST;LEASE;O & G

Implemented As

15 AAC 55.151
15 AAC 55.161
15 AAC 55.163
15 AAC 55.180
15 AAC 55.181
15 AAC 55.191
15 AAC 55.192
15 AAC 55.193
15 AAC 55.195
15 AAC 55.196
15 AAC 55.197
15 AAC 55.805
15 AAC 55.900

References

15 AAC 55.151
15 AAC 55.181
15 AAC 55.193
15 AAC 55.805
AS 43.55.160 Determination of production tax value of oil and gas.

History

(Sec. 6 ch 107 SLA 1976; am Sec. 92 ch 59 SLA 1982; am Sec. 1 ch 114 SLA 1989; am Sec. 24 ch 2 TSSLA 2006; am Sec. 53 ch 1 SSSLA 2007)