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SEC. 305. 5-YEAR NET OPERATING LOSS CARRYBACK FOR
LOSSES ATTRIBUTABLE TO OPERATING MIN-
ERAL INTERESTS OF OIL AND GAS PRO-
DUCERS.
(a) IN GENERAL.—Paragraph (1) of section 172(b)
(relating to years to which loss may be carried) is amended
by adding at the end the following new subparagraph:
‘‘(H) LOSSES ON OPERATING MINERAL IN-
TERESTS OF OIL AND GAS PRODUCERS.—In the
case of a taxpayer which has an eligible oil and
gas loss (as defined in subsection (j)) for a tax-
able year, such eligible oil and gas loss shall be
a net operating loss carryback to each of the 5
taxable years preceding the taxable year of such
loss.’’.
(b) ELIGIBLE OIL AND GAS LOSS.—Section 172 is
amended by redesignating subsection (j) as subsection (k)
and by inserting after subsection (i) the following new sub-
section:
‘‘(j) ELIGIBLE OIL AND GAS LOSS.—For purposes of
this section—
‘‘(1) IN GENERAL.—The term ‘eligible oil and
gas loss’ means the lesser of—
‘‘(A) the amount which would be the net op-
erating loss for the taxable year if only income
and deductions attributable to operating mineral
183
interests (as defined in section 614(d)) in oil and
gas wells are taken into account, or
‘‘(B) the amount of the net operating loss
for such taxable year.
‘‘(2) COORDINATION WITH SUBSECTION (b)(2).—
For purposes of applying subsection (b)(2), an eligible
oil and gas loss for any taxable year shall be treated
in a manner similar to the manner in which a speci-
fied liability loss is treated.
‘‘(3) ELECTION.—Any taxpayer entitled to a 5-
year carryback under subsection (b)(1)(H) from any
loss year may elect to have the carryback period with
respect to such loss year determined without regard to
subsection (b)(1)(H).’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to net operating losses for taxable years
beginning after December 31, 2001.
SEC. 306. EXTENSION AND MODIFICATION OF CREDIT FOR
PRODUCING 
FUEL 
FROM 
A 
NONCONVEN-
TIONAL SOURCE.
(a) IN GENERAL.—Section 29 is amended by adding
at the end the following new subsection:
‘‘(h) EXTENSION FOR OTHER FACILITIES.—
‘‘(1) EXTENSION FOR OIL AND CERTAIN GAS.—In
the case of a well for producing qualified fuels de-
184
scribed in subparagraph (A) or (B)(i) of subsection
(c)(1)—
‘‘(A) APPLICATION
OF
CREDIT
FOR
NEW
WELLS.—Notwithstanding subsection (f), this
section shall apply with respect to such fuels—
‘‘(i) which are produced from a well
drilled after the date of the enactment of
this subsection and before January 1, 2007,
and
‘‘(ii) which are sold not later than the
close of the 4-year period beginning on the
date that such well is drilled, or, if earlier,
January 1, 2010.
‘‘(B) EXTENSION
OF
CREDIT
FOR
OLD
WELLS.—Subsection (f)(2) shall be applied by
substituting ‘2007’ for ‘2003’ with respect to
wells described in subsection (f)(1)(A) with re-
spect to such fuels.
‘‘(2) EXTENSION
FOR
FACILITIES
PRODUCING
QUALIFIED FUEL FROM LANDFILL GAS.—
‘‘(A) IN GENERAL.—In the case of a facility
for producing qualified fuel from landfill gas
which was placed in service after June 30, 1998,
and before January 1, 2007, this section shall
185
apply to fuel produced at such facility during
the 5-year period beginning on the later of—
‘‘(i) the date such facility was placed
in service, or
‘‘(ii) the date of the enactment of this
subsection.
‘‘(B) REDUCTION OF CREDIT FOR CERTAIN
LANDFILL FACILITIES.—In the case of a facility
to which paragraph (1) applies and which is
subject to the 1996 New Source Performance
Standards/Emmissions Guidelines of the Envi-
ronmental Protection Agency, subsection (a)(1)
shall be applied by substituting ‘$2’ for ‘$3’.
‘‘(3) SPECIAL
RULES.—In determining the
amount of credit allowable under this section solely
by reason of this subsection—
‘‘(A) DAILY LIMIT.—The amount of quali-
fied fuels sold during any taxable year which
may be taken into account by reason of this sub-
section with respect to any project shall not ex-
ceed an average barrel-of-oil equivalent of
200,000 cubic feet of natural gas per day. Days
before the date the project is placed in service
shall not be taken into account in determining
such average.
186
‘‘(B) EXTENSION
PERIOD
TO
COMMENCE
WITH
UNADJUSTED
CREDIT
AMOUNT.—In the
case of fuels sold during 2001 and 2002, the dol-
lar amount applicable under subsection (a)(1)
shall be $3 (without regard to subsection (b)(2)).
In the case of fuels sold after 2002, subparagraph
(B) of subsection (d)(2) shall be applied by sub-
stituting ‘2002’ for ‘1979’.’’.
(b) EFFECTIVE DATE.—The amendment made by this
section shall apply to fuel sold after the date of the enact-
ment of this Act.
SEC. 307. BUSINESS RELATED ENERGY CREDITS ALLOWED
AGAINST REGULAR AND MINIMUM TAX.
(a) IN GENERAL.—Subsection (c) of section 38 (relat-
ing to limitation based on amount of tax) is amended by
redesignating paragraph (3) as paragraph (4) and by in-
serting after paragraph (2) the following new paragraph:
‘‘(3) SPECIAL
RULES
FOR
SPECIFIED
ENERGY
CREDITS.—
‘‘(A) IN GENERAL.—In the case of specified
energy credits—
‘‘(i) this section and section 39 shall be
applied separately with respect to such
credits, and
187
‘‘(ii) in applying paragraph (1) to
such credits—
‘‘(I) the tentative minimum tax
shall be treated as being zero, and
‘‘(II) the limitation under para-
graph (1) (as modified by subclause
(I)) shall be reduced by the credit al-
lowed under subsection (a) for the tax-
able year (other than the specified en-
ergy credits).
‘‘(B) SPECIFIED
ENERGY
CREDITS.—For
purposes of this subsection, the term ‘specified
energy credits’ means the credits determined
under sections 45G, 45H, 45I, 45J, and 45K.’’.
(b) CONFORMING AMENDMENT.—Subclause (II) of sec-
tion 38(c)(2)(A)(ii) is amended by inserting ‘‘or the speci-
fied energy credits’’ after ‘‘employment credit’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years ending after the date
of enactment of this Act.
SEC. 308. TEMPORARY REPEAL OF ALTERNATIVE MINIMUM
TAX PREFERENCE FOR INTANGIBLE DRILL-
ING COSTS.
(a) IN GENERAL.—Clause (ii) of section 57(a)(2)(E)
is amended by adding at the end the following new sentence:
188
‘‘The preceding sentence shall not apply to taxable years
beginning after December 31, 2001, and before January 1,
2005.’’.
(b) EFFECTIVE DATES.—The amendment made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2001.
SEC. 309. ALLOWANCE OF ENHANCED RECOVERY CREDIT
AGAINST THE ALTERNATIVE MINIMUM TAX.
(a) IN
GENERAL.—Subparagraph (B) of section
38(c)(4) is amended by adding at the end the following new
sentence: ‘‘For taxable years beginning before January 1,
2005, such term includes the credit determined under sec-
tion 43.’’
(b) EFFECTIVE DATE.—The amendment made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2001.
SEC. 310. EXTENSION OF CERTAIN BENEFITS FOR ENERGY-
RELATED BUSINESSES ON INDIAN RESERVA-
TIONS.
(a) DEPRECIATION FOR PROPERTY ON INDIAN RES-
ERVATIONS.—Paragraph (8) of section 168(j) (relating to
termination) is amended by adding at the end the following
new sentence: ‘‘The preceding sentence shall be applied by
substituting ‘December 31, 2006’ for ‘December 31, 2003’
189
in the case of property placed in service as part of a facility
for—
‘‘(A) the generation or transmission of elec-
tricity (including from any qualified energy re-
source, as defined in section 45(c)),
‘‘(B) an oil or gas well,
‘‘(C) the transmission or refining of oil or
gas, or
‘‘(D) the production of any qualified fuel
(as defined in section 29(c)).’’
(b) EMPLOYMENT OF INDIANS.—Subsection (f) of sec-
tion 45A (relating to termination) is amended by adding
at the end the following new sentence: ‘‘The preceding sen-
tence shall be applied by substituting ‘December 31, 2006’
for ‘December 31, 2003’ in the case of wages paid for serv-
ices performed at a facility described in section 168(j)(8).’’
Union Calendar No. 93
107TH CONGRESS
1ST SESSION
H. R. 2511
[Report No. 107–157]
A BILL
To amend the Internal Revenue Code of 1986 to
provide tax incentives to encourage energy con-
servation, energy reliability, and energy produc-
tion.
JULY 24, 2001
Reported with an amendment, committed to the Com-
mittee of the Whole House on the State of the Union,
and ordered to be printed