47.02.080 Value
(a) Except as otherwise indicated in this section, the value of severed minerals upon which the rate of tax shall be applied shall be the gross proceeds unit price multi plied by the wellhead volume less applicable transportation costs. When calculating the transportation deduction, treating, and all other costs associated with placing severed minerals into a marketable condition are not deductible. In those instances in which severed natural gas is sold by the producer after having been processed, the value of such natural gas shall be the value of the processed liquids less applicable processing and transportation costs plus the gross value of the residue gas less applicable transportation costs. In computing the net value of processed products, the formula for computing net value shall be submitted by the working interest owner or operator to the Tribal Council or its authorized representative for prior approval and only reasonable and necessary expenses incurred in such processing shall be permitted in computing said net value.
(b) Notwithstanding the provision of Section 47.02.080(a), the taxpayer may elect to base its monthly tax payment on the Maximum Territory Price. This election must be made prior to October 1st of each year by written notice to the Tax Commissioner and cannot be modified until the following year. The formula for the calculation of the Maximum Territory Price is as follows:
H1 + Hi + ...Hu- X = Calculated Territory Price where the followi ng:
N
H = The arithmetic average of the highest prices (Bid week or first of the month publication) in the range of all index pricing points in the San Juan Basin as published in each valid index publication.
N = Number of valid publications.
X = A discount factor of I 0%. X shall never be less than 10 cents nor more than 30 cents.
(c) If such an election is made, the value basis for the associated tax payment shall be final and not subject to future audit or review.
(d) Promptly following receipt of the information needed to compute the Maxim um Territory Price. The Tax Commissioner shall render such calculation. Such authorized representative shall inform any taxpayer so requesting the Maximum Territory Price for time periods for which the calculation has been made.
