15 AAC 55.196 - Cost of capital allowance to be used in calculation of costs of vessel transportation for oil or gas, and in calculation of transportation costs for gas by an LNG transportation facility
(a) For oil or gas
produced on or after January 1, 2003, a cost of capital allowance that consists
of depreciation and a return on invested capital will be allowed under this
section, as provided in
15 AAC 55.193, for a (1) vessel, or an improvement
completed on or after January 1, 2002 to a vessel, owned or effectively owned
by the producer; or (2) LNG transportation facility owned or effectively owned
by the producer and placed in service after December 31, 2010, or an
improvement to that facility. However, a producer may elect to expense the
first $2,000,000 in costs incurred with respect to improvements during a
calendar year.
(b) A cost of
capital allowance under this section for a vessel will be allowed only for days
when the vessel is in allowable service, in allowable lay up, or in allowable
dry dock.
(c) The following
requirements apply to the timing of changes in vessel status:
(1) a vessel changing from operation in
allowable service to lay up or operation in alterative service begins lay up or
operation in alternative service on the day after the last day of cargo
discharge in allowable service;
(2)
a vessel changing from operation in alternative service to lay up or operation
in allowable service begins lay up or operation in allowable service on the day
after the last day of cargo discharge in alternative service;
(3) a vessel changing from lay up to
operation in allowable service or operation in alternative service begins
operation in allowable service or operation in alternative service on the day
after the vessel departs from the location where the vessel was laid
up;
(4) a vessel going into dry
dock begins dry dock status on the day after the last day of cargo discharge
or, if going into dry dock from lay up, on the day after the vessel departs
from the location where the vessel was laid up;
(5) a vessel finishing dry dock changes from
dry dock status to the immediately subsequent status on the day after the
vessel departs the dry dock facility;
(6) a vessel begins operation in allowable
service on the day that its useful life begins or, in the case of a used vessel
newly acquired by a producer, on the day that its remaining useful life for
that producer begins, if the vessel proceeds directly to enter operation in
allowable service; otherwise, the vessel begins operation in alternative
service on the day specified in this paragraph; for purposes of this paragraph,
the beginning of a vessel's useful life or remaining useful life is determined
in accordance with generally accepted accounting principles.
(d) A cost of capital allowance
under this section must be calculated using the methodology set out in the
department's publication Computation of a Cost-of-Capital Allowance
under 15 AAC 55.196, Incorporating Depreciation and Return on Invested Capital
for Marine Vessels and Improvements; Edition 4.0, dated November 19,
2019 and adopted by reference.
(e)
For purposes of this section,
(1) a vessel is
in allowable service if the vessel is
(A) in
service within the meaning given in
15 AAC 55.900, except when the vessel is in dry dock;
or
(B) idle for a period of fewer
than 90 consecutive days immediately before operation in allowable service
under (A) of this paragraph; for purposes of this subparagraph, a vessel is not
idle if it is in dry dock;
(2) a vessel is laid up if it is idle for a
period of 90 or more consecutive days; for purposes of this paragraph, a vessel
is not idle if it is in dry dock;
(3) a vessel is in allowable lay up if the
vessel is laid up during a calendar year, but only to the extent that the total
number of days it is or has been laid up while owned or effectively owned by
the producer through the end of that calendar year does not exceed the total
number of days it is or has been in allowable service while owned or
effectively owned by the producer through the end of that calendar
year;
(4) a vessel is in allowable
dry dock if the vessel is in dry dock during a calendar year, but only for that
fraction of the total days in dry dock that equals the sum of the number of
days during the year that the vessel is in allowable service and the number of
days during the year that the vessel is in allowable lay up, divided by the sum
of the number of days during the year that the vessel is in allowable service,
the number of days during the year that the vessel is laid up, and the number
of days during the year that the vessel is in alternative service;
(5) a vessel is in alternative service if it
is not in lay up, dry dock, or allowable service; and
(6) if necessary to determine a vessel's
status during a month, the vessel's status at later times will be
considered.
(f) In (b),
(c), and (e) of this section, "vessel" includes LNG tanker.
Notes
Authority:AS 43.05.080
AS 43.55.020
AS 43.55.030
AS 43.55.040
AS 43.55.110
AS 43.55.150
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