Okla. Admin. Code § 710:65-13-122

Current through Vol. 41, No. 19, June 17, 2024

Section 710:65-13-122 - Exemption for sales of electricity for use in a reservoir dewatering project

(a)General provisions. Beginning January 1, 2004, sales of electricity and associated delivery and transmission services, when sold exclusively for use by an oil and gas operator for approved reservoir dewatering projects and associated operations shall be exempt from the levy of sales tax.

(b)Where to apply. To qualify for the exemption, the operator of the reservoir dewatering project must apply in writing to the Business Tax Services Division, Oklahoma Tax Commission, Oklahoma City, OK 73194, requesting an exemption letter.

(c)Contents of the application letter. The letter of application must set out the name of the operator, the physical location of the project, the federal identification number of the operator, the date the project commenced, and the electric service account number associated with services provided to the project. A copy of the Oklahoma Corporation Commission Order approving the designation of the area and reservoir as a "reservoir dewatering project" or a "reservoir dewatering unit" must accompany the application letter.

(d)Review and approval procedure. Upon review and approval, a letter of exemption shall be issued to the operator, who must forward the exemption letter to the electricity utility, to document the sales tax exemption on their purchases of electricity. The letter, when provided to the utility along with a statement by the operator that the purchases of electricity are exempt, shall constitute "properly completed documentation certified by the Oklahoma Tax Commission" as that phrase is used in 710:65-7-6.

(e)Limitations. The exemption shall apply to the electricity used in reservoir dewatering projects and associated operations which commenced after June 30, 2003. The exemption shall not apply to the transportation or distribution of the oil or gas once it has been produced.

Okla. Admin. Code § 710:65-13-122

Reserved at 14 Ok Reg 2711, eff 6-26-97; Added at 20 Ok Reg 2175, eff 6-26-03

Amended by Oklahoma Register, Volume 38, Issue 23, August 16, 2021, eff. 9/1/2021

Amended by Oklahoma Register, Volume 39, Issue 24, September 1, 2022, eff. 9/11/2022