Louisiana Administrative Code › Title 61 - REVENUE AND TAXATION › Part I - Taxes Collected and Administered by the Secretary of Revenue › Chapter 29 - Natural Resources: Severance Tax › Section I-2903 - Severance Taxes on Oil; Distillate, Condensate or Similar Natural Resources; Natural Gasoline or Casinghead Gasoline; Liquefied Petroleum Gases and Other Natural Gas Liquids; and Gas

Current through Register Vol. 50, No. 6, June 20, 2024
A. Definitions
Allocation of Value
- inasmuch as oil and/or
				  condensate is accounted for on a lease basis, rather than on an individual well
				  basis, the gross value received for runs from a lease shall be allocated to the
				  wells within the lease on the basis of the pro rata barrels run from each well;
				  it being the intent of this Section to apportion value received to all
				  producing wells in a lease without regard to the tax rate applicable to each
				  well.
Condensate
- liquid hydrocarbons, other than
				  natural or casinghead gasoline, referred to as condensate, distillate or other
				  natural resources, which will remain in a liquid state, under atmospheric
				  conditions of pressure and temperature, recovered by ordinary production
				  methods from a gas well as classified by the Office of Conservation. This also
				  includes liquid hydrocarbons recovered from separators or scrubbers situated at
				  inlets to plants, compressors, dehydrators, and metering stations.
Department
- the Department of
				  Revenue.
Gas
- gaseous phase hydrocarbons recovered by
				  separation from either an oil well or gas well.
Gas Tax Rate
- the gas tax rate as adjusted
				  annually in accordance with
				  R.S.
				  47:633(9)(i) will be rounded
				  to the nearest 1/10 of 1 cent. When rounding, if the fourth decimal digit is
				  five or greater, the rate shall be rounded up to the nearest tenth; if the
				  fourth decimal digit is less than five, the rate shall be rounded down to the
				  nearest tenth.
Incapable Gas Well
- a well classified by the
				  Office of Conservation as a gas well which has been determined by the secretary
				  to be incapable of producing an average of 250,000 cubic feet of gas per day,
				  under operating conditions, throughout the entire taxable month.
Low Pressure Oil Well
- a well classified by
				  the Office of Conservation as an oil well which has been determined by the
				  secretary to have a wellhead pressure of 50 pounds per square inch gauge or
				  less, under operating conditions, whether it be tubing flow or casing flow,
				  throughout the entire taxable month. An oil well producing oil by any
				  artificial method, such as gas lift, pumping or hydraulic lift shall be
				  presumed, in the absence of a determination to the contrary by the secretary,
				  to have a wellhead pressure of 50 pounds per square inch gauge or less under
				  operating conditions.
Natural Gas Liquids
-
natural gas
				  liquids
, butane, propane, ethane and methane extracted as the result
				  of additional processes employed in the mechanical processes as outlined in
				  §2903 A
Natural or Casinghead Gasoline
.
Natural or Casinghead Gasoline
- liquid
				  hydrocarbons recovered from gas (subsequent to the ultimate separation and/or
				  scrubbing of the gas stream) by specifically applied mechanical processes of
				  absorption, adsorption, compression cooling, cryogenics and refrigeration to
				  the entire volume of
gas
from which these liquid hydrocarbons
				  are recovered. This includes liquid hydrocarbons recovered from hydrex and HRU
				  units.
Oil
- liquid hydrocarbons recovered by
				  initial separation from a well classified as an oil well by the Office of
				  Conservation.
Payout
-the payout of the well cost for a
				  horizontal well as referred to in
				  R.S.
				  47:633(7)(c)(iii), a deep
				  well as referred to in
				  R.S.
				  47:633(9)(d)(v), and a new
				  discovery well as referred to in
				  R.S.
				  47:648.3 occurs when gross revenue from the
				  well, less royalties and operating costs directly attributable to the well,
				  equals the well cost as approved by the Office of Conservation. Operating costs
				  are limited to those costs directly attributable to the operation of the exempt
				  well, such as direct materials, supplies, fuel, direct labor, contract labor or
				  services, repairs, maintenance, property taxes, insurance, depreciation, and
				  any other costs that can be directly attributed to the operation of the well.
				  Operating costs do not include any costs that were included in the well cost
				  approved by the Office of Conservation.
Secretary
- the Secretary of the Department
				  of Revenue.
Stripper Field
- a field in which all crude
				  oil production is from certified stripper oil wells.
Value
- with respect to oil and/or
				  condensate, the value shall be the higher of the gross receipts received from
				  the first purchaser by the producer or the posted field price.
a.
Gross Receipts
- the total
				amount of payment:
i. received from the first
				purchaser in an arm's length transaction; or
ii. received from the first purchaser or
				transferred from the first purchaser by recognized accounting methodology, in a
				non-arm's length transaction. Gross receipts shall include bonus or premium
				payments when made by the purchaser to the owner, all advanced payments, and
				any other thing of value such as exchanges, barter, or reimbursement of costs.
				Advanced payments are not taxable until the oil and/or condensate for which
				such payments are made are actually severed and delivered to the
				purchaser.