Section 15 AAC 55.206 - Calculation of production tax values for oil and gas produced after June 30, 2007 and before January 1, 2022, and for oil produced after December 31, 2021(a) A producer or, under AS 43.55.160(d), an explorer shall calculate a single production tax value for a calendar year, under AS 43.55.160(a)(1), or, as applicable for each segment.(b) The provision of AS 43.55.160(b) that a production tax value may not be less than zero applies to each production tax value calculated for each segment. Subject to the provisions of AS 43.55.023(b)(2), as those provisions read before January 1, 2018, for oil and gas produced before January 1, 2018, or the provisions of AS 43.55.160(e), for oil and gas produced after December 31, 2017, adjusted lease expenditures applicable to a segment that exceed the amount of adjusted lease expenditures that may, under AS 43.55.160(b), be deducted in calculating a production tax value for the segment are considered excess adjusted lease expenditures and, except as otherwise provided under 15 AAC 55.224, may not be reallocated to, or deducted in calculating a production tax value for, a different segment. Excess adjusted lease expenditures relating to the calculation of an annual production tax value, but not a monthly production tax value, may be used to establish a carried-forward annual loss to the extent allowed under AS 43.55.023(b), as the provisions of that subsection read before January 1, 2018, for oil and gas produced before January 1. 21)18, or under AS 43.55.165(a)(3). for oil and gas produced after December 31, 2017, and AS 43.55.160(e).(c) For purposes of this section, (1) for oil and gas produced for a calendar year before 2022, and except as otherwise provided under (2) of this subsection, each of the following is a segment for a producer: (A) all oil and gas, if any, taxable under AS 43.55.011(e), other than gas subject to AS 43.55.011(o), that the producer produces from leases or properties in the state that include land north of 68 degrees North latitude;(B) all oil and gas, if any, taxable under AS 43.55.011(e), other than gas subject to AS 43.55.011(o) or oil or gas subject to AS 43.55.011(p), that the producer produces from leases or properties in the state outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, for a calendar year before or during the last calendar year under AS 43.55.024(b) for which the producer could take a tax credit under AS 43.55.024(a);(C) oil, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the Cook Inlet sedimentary basin; for purposes of this paragraph, oil produced from each lease or property constitutes a separate segment;(D) gas, if any, taxable under AS 43.55.011(e) that the producer produces before 2022 from each lease or property in the Cook Inlet sedimentary basin; for purposes of this paragraph, gas produced from each lease or property constitutes a separate segment;(E) gas, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the state outside the Cook Inlet sedimentary basin and that is used in the state, other than gas subject to AS 43.55.011(p); for purposes of this paragraph, gas produced from each lease or property constitutes a separate segment;(F) all oil and gas if any, taxable under AS 43.55.011(e) and subject to AS 43.55.011(p) that the producer produces;(G) all oil and gas, if any taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state no part of which is north of 68 degrees North latitude, other than oil or gas described in (B), (C), (D), (E), or (F) of this paragraph;(2) if a producer or explorer for a calendar year before 2022 does not produce any oil or gas from leases or properties in the (A) state that include land north of 68 degrees North latitude, the area of the state north of 68 degrees North latitude is a segment for the producer or explorer;(B) state outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, the area of the state outside the Cook Inlet sedimentary basin and not including any land north of 68 degrees North latitude is a segment for the producer or explorer.(3) for oil and gas produced for a calendar year after 2021, and except as otherwise provided under (4) of this subsection, each of the following is a segment for a producer: (A) oil, if any, taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state that include land north of 68 degrees North latitude;(B) oil, if any, taxable under AS 43.55.011(e) other than oil subject to AS 43.55.01 l(p), that the producer produces from leases or properties in the state outside the Cook Inlet sedimentary basin, no part of which is north of 68 degrees North latitude, for a calendar year before or during the last calendar year under AS 43.55.024(b) for which the producer could take a tax credit under AS 43.55.024(a);(C) oil, if any, taxable under AS 43.55.011(e) that the producer produces from each lease or property in the Cook Inlet sedimentary basin; for purposes of this subparagraph, oil produced from each lease or property constitutes a separate segment;(D) oil, if any, taxable under AS 43.55.011(e) and subject to AS 43.55.01 l(p) that the producer produces;(E) oil, if any, taxable under AS 43.55.011(e) that the producer produces from leases or properties in the state no part of which is north of 68 degrees North latitude, other than oil described in (B), (C) or (D) of this paragraph(4) if a producer or explorer for a calendar year after 2021 does not produce any oil from leases or properties in the state (A) that include land north of 68 degrees North latitude, the area of the state north of 68 degrees North latitude is a segment for the producer or explorer; (B) outside the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude, the area of the state outside of the Cook Inlet sedimentary basin no part of which is north of 68 degrees North latitude is a segment for the producer or explorer.(d) For leases or properties in the Cook Inlet sedimentary basin that first commenced commercial production of oil or gas before April 1, 2006, unless otherwise approved or required by the department, the producer shall continue to treat as a single lease or property each tract, group of tracts, participating area, or unit that the producer consistently treated, subject to final audit resolution, as a single lease or property for purposes of calculating an economic limit factor under former AS 43.55.013. Production of oil or gas from a lease or property in the Cook Inlet sedimentary basin that first commences commercial production of oil or gas on or after April 1, 2006, and that corresponds to a participating area or unit approved by the Department of Natural Resources under AS 38.05.180, other than a lease or property for which the producer calculated an economic limit factor under former AS 43.55.013, must be treated as production from a distinct lease or property.(e) Except as otherwise provided under (f) of this section, (1) for gas used in the state and produced from leases or properties outside the Cook Inlet sedimentary basin that first commenced commercial gas production before April 1, 2006, unless otherwise approved or required by the department, the producer shall continue to treat as a single lease or property each tract, group of tracts, participating area, or unit that the producer consistently treated, subject to final audit resolution, as a single lease or property for purposes of calculating an economic limit factor under former AS 43.55.013;(2) production of gas used in the state from a lease or property outside the Cook Inlet sedimentary basin that first commences commercial production on or after April 1, 2006, and that corresponds to a participating area or unit approved by the Department of Natural Resources under AS 38.05.180, other than a lease or property for which the producer calculated an economic limit factor under former AS 43.55.013, must be treated as production from a distinct lease or property.(f) For purposes of this section, 15 AAC 55.215, and 15 AAC 55.217, if a unit, other than a unit within the Cook Inlet sedimentary basin contains multiple participating areas, the participating areas together may be treated as a single lease or property, unless any producer's ownership interests differ by 10 percentage points or more between two or more of the participating areas.(g) This section applies to oil and gas produced after June 30, 2007.(h) In the calculation of annual production tax value under AS 43.55.160(a)(1) or (h) for a calendar year, the provisions of AS 43.55.165(n)(2) do not affect the deductibility of adjusted lease expenditures for the calendar year under AS 43.55.165(a) that are described in AS 43.55.165(a)(1) and (2).Eff. 10/21/2009, Register 192; am 12/25/2013, Register 208, January 2014; am 3/1/2017, Register 221, April 2017; am 12/6/2018, Register 228, January 2019 ; am 1/1/2022,Register 240, January 2022 Authority:AS 43.05.080
AS 43.55.011
AS 43.55.024
AS 43.55.110
AS 43.55.160
AS 43.55.165