Notice Number:
Tax Type:Mineral Severance Tax
Brief Description:New Legislation,Definitions
Effective Date:07/01/1992


To: Oil and Gas Industry Operators/Producers and Purchasers

From: Kansas Department of Revenue, Business Tax Bureau, Mineral Tax Section

Date: July 1, 1992

Subject: Enactment of New Legislation Concerning Mineral Severance Tax

Senate Bill 216 of the 1992 Legislative Session has included a new definition of terms relating to the Kansas Statutes Annotated, Article 42, Mineral Severance Tax.

"Disruption of production" means, in the case of oil, a continuous 24-hour period during which a well is not producing. Circulating and missed production days shall be considered production days if the operator can demonstrate that any lost productions subsequently recovered during a later production day. In the case of gas, a continuous one-hour period during which a well is not open to the pipeline shall be deemed to be a disruption of production. Missed production hours shall be considered production hours if the operator can demonstrate that any lost production is subsequently recovered during later production hours.

It is extremely important for all relevant documentation to be preserved and to be made available for audit in order to substantiate any claims made relating to the above definition or any other Mineral Tax issue. Certain specific items to re retained for review may include, but not be limited to:

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