Alaska Administrative Code › Title 11 - Natural Resources › Part 6 - Lands › Chapter 83 - Oil and Gas Leasing › Article 2 - Net Profit Share Leasing › 11 AAC 83.244 - Pricing of materials and supplies

Current through May 31, 2024
Material purchases, transfers and dispositions by a lessee
					 for use on a NPSL must be priced according to the following standards:
(1) Material purchased must be charged at the
				  price paid by lessee after deduction of all discounts received. In case of
				  material found to be defective or returned to a vendor for any other reason,
				  credit must be passed to the appropriate account when adjustment has been
				  received by the lessee.
(2)
				  Material transferred within the NPSL operations and material transferred from
				  the NPSL operations or disposed of by the lessee must be priced at average
				  warehouse stock prices. Transfers will be priced at current-condition value
				  using average warehouse stock prices if they are available and reasonably
				  representative of current market price. If they are not available or are not
				  reasonably representative of current market price, the following applies.
				  Material transferred must be priced at current-condition value replacement cost
				  effective at date of transfer as specified in paragraph (3) of this section
				  which must include material invoice cost, labor supplies, transportation, and
				  material handling charges associated with getting material FOB to the NPSL
				  property.
(3) Material required for
				  operation must be purchased for direct charge to the NPSL account whenever
				  practical. However, under circumstances where it is most practical for lessee
				  to furnish materials from lessee's storehouse or other properties located in
				  Canada, Alaska, or the continental United States, those material movements are
				  subject to the following:
(A) New material is
				  classified as Condition "A" and must be priced as follows:
(i) Tubular goods, except line pipe involving
				  movements for less than 30,000 pounds, must be priced at the current price in
				  effect on date of movement on a maximum carload or barge load weight basis,
				  regardless of quantity transferred, equalized to the lowest published price FOB
				  railway receiving point, recognized barge terminal, or air cargo receiving
				  point nearest the NPSL where that material is normally available.
(ii) Line pipe involving movement of less
				  than 30,000 pounds must be priced at the current price in effect at date of
				  movement, as listed by a reliable supply store nearest the NPSL where such
				  material is normally available. Movement of 30,000 pounds or more must be
				  priced under provisions of tubular goods pricing in (i) of this
				  subparagraph.
(iii) Other material
				  must be priced at the current new price in effect at the date of movement,
				  listed by a reliable supply store or FOB railway or air cargo receiving point
				  nearest the NPSL where that material is normally available.
(iv) The NPSL account will not be credited
				  with cash discounts applicable to prices provided for in paragraph (3) of this
				  section.