Identifying Information:1984 Legislative Changes
Tax Type:Mineral Severance Tax
Brief Description:Natural Gas Exemptions/common meter
Effective Date:05/25/1984


TO: Kansas Natural Gas and Crude Operators

FROM: Bob Clelland, Acting Manager, Mineral Tax Bureau

DATE: May 25, 1984

SUBJECT: 1984 Legislative Change to Kansas Severance Tax Law

the 1984 Kansas Legislature made a few minor changes to the severance tax law. Following is a brief description of these changes:

The $81 a day exemption, for natural gas, shall be computed by dividing the total value of production gauged at meter by the number of wells feeding into the meter with the result divided by the number of days the wells produced during the month.

Example: Purchaser A buys $5,280.14 of gas from Operator B during the month of February. Four wells produced this gas which was gauged through a common meter. Average daily productions is $5,280.14 4 = $1,320.04 20 = $66.00. Average daily production is less than $81 a day and accordingly exempt from severance tax for the month of February.

The crude oil lease exemption was clarified by adding "per producing well" for determining the average daily production from a lease. The Department of Revenue has used this definition in granting all lease exemptions. "New Pool" status is to be determined by the Kansas Corporation Commission and certified to the Director of Taxation. This clarifies current procedures.

Production from a "New Pool" is exempt for a period of 24 months form date oil or gas was first produced from such pool. Date of first production shall be defined as:

Date Composed: 10/06/1997 Date Modified: 10/09/2001