11 AAC 25.070 - Allocation of gas and costs upstream of the Alaska mainline
(a) Unless
otherwise provided in this chapter, a lessee calculating the monthly value of
the state's royalty share of qualified gas under this chapter shall allocate
gas and costs upstream of the inlet to the Alaska mainline as provided in this
section.
(b) Qualified gas must be
allocated to each North Slope lease producing royalty-bearing gas that has
pipeline transportation access to the Alaska mainline . Qualified gas and
nonqualified gas must be allocated among leases held by a lessee on the basis
of a percentage for each lease represented by a ratio, the numerator of which
is the lessee's quantity of royalty-bearing gas produced from a North Slope
lease with pipeline transportation access to the Alaska mainline and the
denominator of which is the lessee's quantity of royalty-bearing gas produced
from all North Slope leases with pipeline transportation access to the Alaska
mainline . For purposes of this subsection, quantities must be measured in
MMBtus.
(c) Unless prohibited under
(d) of this section or
11 AAC 25.160 -
11 AAC 25.220, a lessee may deduct
costs of pipeline transportation allowed under this chapter for a pipeline
upstream of the inlet to the Alaska mainline . The deduction will be allowed for
pipeline transportation from the boundary of the unit of production to a gas
treatment plant located outside the unit of production, or, if the lease of
production is not within a unit, the lessee may deduct the costs of pipeline
transportation from the boundary of the lease of production to a gas treatment
plant located off the lease of production.
(d) If carbon dioxide exceeding the
percentage of carbon dioxide allowed into the Alaska mainline is transported in
a pipeline upstream of the Alaska mainline , the lessee shall allocate
transportation costs between the excess carbon dioxide and all other gas based
on their relative volumes. A deduction may not be taken in calculating the
monthly value of the state's royalty share of qualified gas for costs allocated
to excess carbon dioxide under this subsection.
(e) Except for a cost that may be deducted
under 11 AAC 25.060(a) (4) or
(5), a lessee in calculating royalty on
qualified gas under this chapter may not deduct a cost of the lease or unit of
production, a cost to meet the specifications for acceptance into the Alaska
mainline , or a cost of putting gas and associated substances in marketable
condition, including the cost of a gas treatment plant upstream of the inlet to
the Alaska mainline .
Notes
Authority:AS 38.05.020
AS 38.05.180
AS 43.90.310
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