Specifically, subparagraph (C) does not state "minerals from oil and gas wells.". Commissioner v. Engle, 464 U.S. 206, 218 (1984). Prior to 1975, section 613 allowed percentage depletion for oil and gas wells. "The 1970's * * * brought about an abrupt redirection in the Nation's energy policy. In 1975 the company opened a small refinery in Mobile, Alabama, to process 30,000 barrels a day of Jay Field crude. Rec. and the applicable percentage (determined in accordance with the table contained in paragraph (5)) shall be deemed to be specified in subsection (b) of section 613 for purposes of subsection (a) of that section. Click on the case name to see the full text of the citing case. 1.613-2(b)(4), Income Tax Regs.10 Section 613(b)(1)(A), which provides for percentage depletion at a rate of 22 percent for sulphur, has no limitation based on the source of the sulphur. WebThe Louisiana Land and Exploration Company Address: 909 Poydras Street P.O. 121 Cong. percent. The Supreme Court has interpreted "oil and gas wells" to mean the oil and gas produced from such wells. At Furnel, Inc. we understand that your projects deserve significant time and dedication to meet our highest standard of quality and commitment. Respondent argues that the amendments to section 613 were intended to eliminate percentage depletion not only for oil and gas but also for all other minerals produced from oil and gas wells except as provided in section 613A. Envisioning farming on a grand scale, Wisner bought hundreds of thousands of acres, built levees, and drained the land. WebContinuing the marriages among energy companies, Burlington Resources Inc. agreed to acquire Louisiana Land & Exploration Co. for about $2.44 billion in stock. (b) PERCENTAGE DEPLETION RATES.The mines, wells, and other natural deposits, and the percentages, referred to in subsection (a) are as follows: (7) 14 PERCENTall other minerals * * * For purposes of this paragraph, the term "all other minerals" does not include. Rul. We reject LL & E's contention that it has proven by affidavit that the gas could at all times have been sold at the Section 109 ceiling price, thereby establishing its value for royalty purposes under the leases. Foreign reserves are located in the U.K. and Dutch sectors of the North Sea, Canada, and Columbia. Section 613(b)(7), however, does not appear to exclude from percentage depletion under section 613 all minerals from oil and gas wells. 4606 (1975). During the 1960s, CEO Fred Graham began a process of diversification that would eventually include a Hawaiian resort, a coastal industrial real estate operation, and coal, gold, and copper mines. WebIn 1988, the company was formed to own the resource assets of Burlington Northern Railroad. Information hosted on The Drillings is based on publicly available data through the Bureau of Land Management. Caspary's charges had some legitimacy. Natchitoches, Cane River Creole National Historical Park in Oil and Gas lease entities located at the same street address in New Orleans, Louisiana as Louisiana Land & Exploration Co.. Percentage depletion for natural resources has been a part of the Internal Revenue Code since the Revenue Act of 1926. oil and natural gas were discovered; capital, Baton Rouge; other Section 613(b) in general provides the list of minerals that are eligible for percentage depletion and specifies the percentage depletion rates. Sec. Steward used excess cash flow--including $198 million from asset sales&mdash repurchase nearly 2.6 million shares and reduce LL&E's total debt by one-third. WebThe Louisiana Land and Exploration Company (LL&E) is one of the largest independent oil and gas exploration companies in the United States. 123673km/47752sqmi. ", But while Graham focused on controlling costs, he, like other CEOs of that era, also sought profits in new businesses. (A salt dome is a raised central area of salt or rock, around which beds of sedimentary rock dip in all directions. The sulphur is then condensed and stored until sold. Petitioners are calendar year, accrual method taxpayers. LOUISIANA LAND AND EXPLORATION COMPANY Company HistoryOil & Natural Gas Extraction. At that time, the lodge housed Section 613,7 however, provides an allowance for depletion for certain mines, wells, and other natural deposits based on a specified percentage of the gross income from the property less any rents or royalties paid or incurred in respect of the property. There is no question that there are no particular gas reserves governed by warranty contracts entered into by Texaco. WebLa. "It was a very unusual contract for 1928," LL&E president Ford Graham told Dun's Review in 1965. If independent producers cannot claim percentage depletion for the sulphur they may recover from hydrogen sulfide before selling the hydrocarbon fuels extracted from an oil and gas well, there is less economic incentive to explore for and exploit new wells, particularly sour gas wells. area, Baton Rouge metropolitan Oil and Gas lease entities located near Louisiana Land & Exploration Co.. A number of cities in Louisiana are also home to Jewish communities, fertile delta lands; further inland are plains and low rolling Also, the company opened its first regional office in Shreveport, LA after acquiring the oil and gas division of T.L. Since then, the area around Paradis has attracted generations of hunting and outdoor enthusiasts alike. (a) GENERAL RULE.Except as otherwise provided in this section, the allowance for depletion under section 611 with respect to any oil or gas well shall be computed without regard to section 613. Because the rules of section 613A work on the foundation of section 613, we look first to the plain language of section 613. After considering the language, structure and legislative record of the passage of section 613A, we do not believe that section 613A was intended to limit sulphur depletion pursuant to section 613(b)(1). 121 Cong. The nonhydrocarbon gases extracted from the Jay Field wells are primarily hydrogen sulfide and carbon dioxide. Respondent thus argues that because the sulphur in issue is a product of oil and gas wells, it loses its section 613 depletion allowance. Given narrow margins, however, LL&E's major interest was in purchasing additional interests in proven properties. WebLouisiana Land & Exploration Co LLC/The - Company Profile and News - Bloomberg Markets Bloomberg Connecting decision makers to a dynamic network of information, people and Wisner was struck by swampy southern Louisiana's resemblance to the low-lying Netherlands, where industrious farmers had reclaimed millions of acres for farming. In 1980, LL E earned profits of 180.2 million dollars or $4.74 per share. Rec. Rec. He added, however, "we are now talking about onepetroleumwhich is the most important of all energy items at this time." French explorers, among whom the following at least should The Louisiana Land and Exploration Company LLC revenue is $280.0M annually. Some thought the major integrated oil companies were reaping excessive oil and gas profits at the public's expense, while reinvesting little of their concomitant tax depletion subsidies in domestic energy production. Sec. Field / Formation: LAKE DES ALLEMANDS / THE LA LAND & EXPLORATION CO U 004: Well Status: DRY AND PLUGGED: Well Type: Township Range Section: 13S 19E 022: Derrick Elevation: Members Only: Kelly Bushing Elevation: Section 613A(e) defines crude oil and natural gas for purposes of section 613A. 7295. Milling, Benson, Woodward, Hillyer, Pierson & Miller, Charles D. Marshall, Jr., Appeal Counsel, David N. Schell, Jr., New Orleans, for plaintiff-appellee Louisiana Land and Exploration Co. Gene W. Lafitte, Appeal Counsel, George J. Domas, Anne E. Tate, Liskow & Lewis, and Frederick W. Veters, Patrick J. Butler, Larry N. Port, Robert E. Plumb, Jr., James D. Hurley, Texaco Inc., New Orleans, for defendant-appellant Texaco, Inc. 3301 et seq. Under the agreement, LL&E retained a 25 percent working interest and a 20 percent royalty in Texaco's share of production. R.S. Moreover, respondent's reading of section 613A could discourage oil and gas production by independent producers and royalty owners, which would be contrary to congressional intent. The well effluent from the Jay Field wells is treated in facilities adjacent to the wells. In response, LL & E filed a cross motion for partial summary judgment to declare these payments improper, which was eventually granted by the district court. During the years in issue, petitioners were engaged primarily in exploration for and development, production, refining, and sale of crude oil and natural gas and exploration for, production and mining of other minerals such as sulphur, gold, silver, copper, and coal in the United States and several foreign countries. The gaseous hydrocarbons, or natural gases, exist in a gaseous state at ambient temperature and pressure and consist primarily of methane, ethane, propane, and butane. 121 Cong. 1965), cert. Brine water, water with a high mineral content, is the nonhydrocarbon liquid extracted from the Jay Field wells. WebAsbestos & Mesothelioma, Medical Malpractice, Nursing Home Abuse, Personal Injury, Products Liability, Workers' Compensation Website Email Profile John J. Lynch Chicago, IL (630) 283-7091 Bankruptcy, Probate, Foreclosure Defense, Real Estate Law, Estate Planning Website Email Profile LL & E's position is that Section 105 does not determine the ceiling price for this gas because the gas is not "subject to" any contract; instead, the LL & E gas is being used to fulfill these particular contracts solely because Texaco has chosen to use it rather than to use gas from other reserves. We find that the use of the term "subject to" in subsection (b), (and again in Section 109) necessarily qualifies the more general language "sold under". WebThe Louisiana Land and Exploration Company LLC * 5 Principals See who the company's key decision makers are 3 Contacts Reach the right people with access to detailed contact 613A(e)(2). We offer full engineering support and work with the best and most updated software programs for design SolidWorks and Mastercam. Senator Mansfield agreed that the bill limited the depletion allowance "for the oil and gas industry while it retains it for almost every other mineral-extractive industry, for * * * 108 items which are covered by the depletion allowance." We find that it was appropriate, and therefore affirm the ruling of the district court. Box 60350 New Orleans, Louisiana 70160 U.S.A. (800) 351-1242 Fax: (504) 566-6891 Public Company State in S USA, The LL & E leases require Texaco to pay royalties based upon a percentage of the value of the gas produced. Founded as the Border Research company in 1926 and renamed Louisiana Land and Exploration a year later, LL&E, for its first twenty years, essentially collected royalties from fossil fuels extracted from nearly 600,000 acres it controlled in southern Louisiana. Louisiana Land & Exploration Co/The - Company Profile A township can refer to two different things. Section 613A bars percentage depletion for oil and gas wells with two exceptions. The venture's finances faltered and in time there were foreclosures. growth rate 2000?2005, Cane River National Heritage Area near It held working interests but did not actively manage projects. 1763, then to the USA in 1783; W region acquired by the USA in the Sec. Subsection (e)(2) defines "natural gas" as "any product (other than crude oil) of an oil or gas well if a deduction for depletion is allowable under section 611 with respect to such product." These apparent anomalies are reconciled, in respondent's view, by attributing to Congress an unexpressed intent to deny any percentage depletion for nonhydrocarbon gases. In 1971 revenues from working interests exceeded those from royalty interests for the first time. Louisiana. In exchange for this, Texaco would retain one-half of the royalties and profits payable to LL&E up to the amount of $800,000. We, therefore, hold that pursuant to section 613(b), petitioners are entitled to percentage depletion deductions in the amounts stipulated for sulphur produced from oil and gas wells. In determining this price, Texaco claims that Section 105 of the NGPA, entitled "Ceiling price for sales under existing intrastate contracts," is applicable. Pub. Both are part of the PLSS measurement system but have different uses. Petitioners are calendar year, accrual method taxpayers. Timken hoped to lease the land to fur trappers. Burlington Resources - Wikipedia Rec. The works of Albert Phelps and Grace King should also be mentioned among WebThe Louisiana Land and Exploration Company Law Practice New Orleans, Louisiana 10 followers The taxpayer may elect to convert part of his oil quantity into a depletable natural gas quantity based on a conversion ratio of 6,000 cubic feet of gas to one barrel of oil. The Frasch industry was developed in the early 20th century and uses superheated water injected into underground sulphur deposits to melt the sulphur, which is then brought to the surface through sulphur wells. This implication, however, is improper given the historical application of the term "oil and gas well" in the depletion provisions to mean simply "oil and gas." Louisiana Land & Exploration Co LLC/The - Company Park, Poverty Point National Monument at Strong collaboration leads to effective conservation The typical well stream in the Jay Field contains approximately 8.5 percent hydrogen sulfide and 2.2 percent carbon dioxide. We disagree. Although this Court will disregard a stipulation that is plainly contrary to the facts (Jasionowski v. Commissioner, 66 T.C. WebLouisiana Land & Exploration Co. PO Box 60350 New Orleans , Louisiana 70160 Louisiana Land & Exploration Co. is a corporation lessee based in New Orleans, Louisiana for 11 oil processing, transportation equipment, paper products, and The early 1960s proved very successful for LL&E. 7295. 4611 (1975) (remarks of Representative Green); 121 Cong. plants in several cities; leads the nation in salt and sulphur The conversion ratio represents a fuel equivalence; 6,000 cubic feet of natural gas generates the same amount of heat as one barrel of oil. Terms of Use, Ultra Petroleum Corporation Business Information, Profile, and History, The Columbia Gas System, Inc. Business Information, Profile, and History, *Estimated as of July 1, 2005U.S. Leagle.com reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions. It also sought to expand riskier but potentially more lucrative foreign exploration. Louis Hennepin, Lahontan, Louis Narcisse Baudry des Lozires, Jean-Baptiste Bnard de La Harpe, and Laval. Join our mailing list to get alerts for lease listing updates, new features, and special opportunities. 1885). Thus, it falls in the category of all other minerals described in section 613(b)(7) and is eligible for percentage depletion at the rate of 14 percent. 121 Cong. Section 613(b)(7) is a catch-all provision for minerals not mentioned elsewhere in the subsection. WebThe company's petroleum operations are conducted in the continental United States, the federal offshore area in the Gulf of Mexico, the North Sea, Colombia, and Indonesia. Follow Lease No. Nevertheless, respondent himself has articulated his belief that the "natural gas" referred to in section 613A is "hydrocarbon gas." Sulphur has been recovered from hydrogen sulfide and sold as a by product of the processing facilities since the facilities were placed in operation. Louisiana Land and Exploration Co In the contract, which was very generous for its time, Texaco agreed to pay LL&E a 25-percent royalty on production and 8 percent of its net profits on a dome-by-dome basis. Natural gas is measured and sold by standard cubic feet. Sec. The natural gas is then transported through natural gas pipelines for use by petitioner or sale to Florida Gas Transmission Co. pursuant to a long-term gas purchase contract dated November 15, 1971. Section 613A(c) provides limited percentage depletion for independent producers and royalty owners based on a depletable oil quantity of 1,000 barrels per day. Listed below are those cases in which this Featured Case is cited. Of the company's 225 million barrels of oil equivalent reserves, nearly 60 percent are garnered from domestic sources. Foreign reserves are located in the U.K. and Dutch sectors of the North Sea, Canada, and Columbia. LL&E traces its roots to the 19th century, when midwestern businessman Edward Wisner moved to Louisiana for his health. 30292-85, 37799-85, 47753-86. See: In the Matter of Amoco Production Co., 78 IBLA 93 (1983) (A decision by the Interior Board of Land Appeals with appeal currently pending in the federal district court, western district of La., docket # CV84-0916); Letter opinion by Charles A. Moore, general counsel of Federal Energy Regulatory Commission, addressed to Tipperary Corp., 1982 Federal Program Advisory Service, p. 3, para. and its Licensors The sour gas streams from the separation system and the oil stabilization system, containing both natural gas and hydrogen sulfide, are combined and further treated in the acid gas removal system. Natural gas, in contrast, is a broad concept encompassing many types of gases and is, therefore, more difficult to define. 95. List of official symbols of Small producers must also separate hydrogen sulfide from natural gas before the natural gas may be transported through pipelines and used as fuel. rice. 3rd Cir.1984), wherein the court approved the procedure of granting a partial summary judgment on the issue of an insurer's obligation to defend, reserving to the insured the right to establish damages in a further proceeding. The separated natural gas is processed further in another contactor which removes water vapor from the gas stream. fishing, particularly for shrimps and oysters; a major source of No damages have yet been proven, and indeed, the partial summary judgment would be proper even if none are ever established. WebThe Louisiana Land and Exploration Company 909 Poydras Street P.O. Click the citation to see the full text of the cited case. WebThe Louisiana Land and Exploration Company Overview. In 1925 speculator Edward Simms approached Timken with an idea for a company that would explore for oil in the almost 600,000 coastal acres Timken then controlled. The Louisiana Land and Exploration Company (LL&E) is one of the largest independent oil and gas exploration companies in the United States. By year's end, Phillips could boast of $94 million in profits on sales of $1.25 billion. Contact Information Website lle.com Ownership There is no indication that Congress intended to limit percentage depletion for any products of oil and gas wells other than hydrocarbon fuels.12. Natchez, Jean Lafitte National Historical Park and Management trumped Caspary, however, when it pledged to spin off to stockholders a tax-sheltered royalty trust holding oil and gas properties that generated $30 million a year. 612. La Land 346 F.2d 377 (5th Cir. Respondent thus concludes that we should not allow percentage depletion for sulphur derived from hydrogen sulfide. Subparagraph (C), which states the oil and gas well exception from depletion, states simply "oil and gas wells." an economic revolution in the early 1900s when large deposits of When a literal reading of a statute conflicts with expressed congressional intent and common usage, we will reject it. Supported by the Hunt family, which boasted a 12.3 percent block of LL&E stock, Caspary attacked LL&E's record since the mid-1970s, pointing to declining earnings, reduced dividends, falling reserves, and the copper acquisition. An "oil and gas well" is not itself a mineral, and to provide a depletion rate for "all other minerals except * * * oil and gas wells" would seem to require an implied reading that "minerals from" must have been intended. Lease No. Rec. tax. Under the circumstances, we cannot say that the gas in question was subject to an existing contract at the time of the NGPA's enactment. LL&E's company earnings, $54.9 million in 1990, fell to $20.9 million in 1991 as falling oil and natural gas prices combined to make the year a difficult one. Rec. 17-023-20688: Well Direction: Operator: MCMORAN EXPLORATION COMPANY: Lease No. WebThe Louisiana Land and Exploration Company was presented the 1997 National Association of Conservation Districts (NACD) Business Conservation Leadership Award at a luncheon The primary issue on appeal is whether that value should be determined under Section 105 of the NGPA, as Texaco argues, or under the higher ceiling price reflected in Section 109 of the NGPA, as LL & E claims. Webster's Third New International Dictionary 1507 (1981) defines natural gas in terms of its value as a fuel: any of various combustible gas mixtures that when in the dry state contain largely methane and in the wet state in association with petroleum contain also higher hydrocarbons and that are used chiefly as fuels * * *. The amine solution absorbs the hydrogen sulfide and carbon dioxide and natural gas flow out of the top of the contactor. tourism. Department of Natural Resources | State of Louisiana (1975). 613A(c)(3). To make up for this, LL&E participated in additional working interest wells and in 1970 discovered a major reserve estimated at 720 million barrels of oil in the Jay Field in Santa Rosa, Florida. Its industrial outputs include chemical products, Deteriorating economic conditions, windfall profits taxes, high dry hole costs, narrower profit margins, and declining demand all pressured earnings. WebIn 1946, this original structure was acquired from the Sun Oil Company and transported by barge from Cocodrie, LA to its current location in Paradis. by Fr. 21 Engel Injection Molding Machines (28 to 300 Ton Capacity), 9 new Rotary Engel Presses (85 Ton Capacity), Rotary and Horizontal Molding, Precision Insert Molding, Full Part Automation, Electric Testing, Hipot Testing, Welding. The floor debates are replete with references to what some members believed to be huge profits enjoyed by the major integrated oil companies and a concomitant lack of need for percentage depletion for oil and gas income. In 1980 he formed CLAM Petroleum, a 50 percent owned unconsolidated affiliate through which LL&E would invest $250 million in the U.K. North Sea's South Brae Field. Such allowance shall not exceed 50 percent of the taxpayer's taxable income from the property (computed without allowance for depletion). Louisiana Land and Exploration Co 613A(c)(1). 7295-7296 (1975). The standard history of the state, though only through Moreover, because of varied corporate exploration philosophies and changes in drilling and seismic forecasting techniques, LL&E was constantly leasing and re-leasing the same acreage to different operators. Respondent's stipulation also suggests that the amount of the depletion deduction is susceptible of calculation. Discover petroleum exploration activity in your area and find new regions of opportunity. "The normal royalty was one-eighth (12 percent). We must decide whether section 613A eliminates the section 613 percentage depletion rate on sulphur when hydrogen sulfide is produced from an oil and gas well and subsequently converted into elemental sulphur. 613A(b). The Copper Range Company owned a copper mine in White Pines, Michigan; refined and fabricated copper bars, strips, plates, and sheets; owned 185 thousand acres of mixed hardwood timber; enjoyed extensive mineral rights in upper Michigan; and owned a one-half interest in a Nevada gold mine. "We pay 25 percent of the cost," Ford Graham enthusiastically told Dun's Review "and get 40 percent of the income. The Drillings makes no warranty, expressed or implied, including the warranties of merchantability and fitness for a particular purpose, nor assumes any legal liability or responsibility for the accuracy, reliability, completeness or utility of these geospatial data, or for the improper or incorrect use of these geospatial data. Due to higher prices for refined copper, the mining operation even turned a profit of $9.7 million in 1979. We agree with the district court that Section 109 applies. About Our Hunting Lodge in Paradis, LA | The Island Court of Appeal of Louisiana, Fourth Circuit. ), among them Shell Oil Co., v. Williams, 428 So.2d 798 (La.1983). Sec. The diagram on the facing page summarizes the sour production processing system used at the Jay Field Wells. A 1915 hurricane destroyed many of the levees that Wisner had constructed. E.g., 121 Cong. 501, 89 Stat. In these consolidated cases, the Commissioner determined deficiencies in petitioners' Federal corporate income tax for the taxable years 1979, 1981, and 1982 as follows: The sole issue remaining for our decision is whether petitioners are entitled to percentage depletion pursuant to section 6131 on income from sulphur chemically converted from hydrogen sulfide produced from an oil and gas well. As if to bear out this description, LL&E's mining operation lost $7.8 million in 1977 and $6.6 million in 1978. Visit DandB.com to locate more business profiles. 121 Cong. These moves strengthened LL&E's overall position, but plunging oil prices and the Copper Range charge took their toll. Of course, hydrogen sulfide is a gas naturally occurring in exhaustible deposits in the earth and falls within a technical classification of "natural gases." Under respondent's reading of section 613A(e)(2), section 613A provides exemptions for hydrocarbons extracted by independent producers and royalty owners but eliminates percentage depletion of nonhydrocarbon "natural gases" extracted from oil and gas wells for all taxpayers. In 1988 crude prices fell by more than $3 a barrel and newly named CEO and chairman H. Leyton Steward was forced to take an $81.8 million restructuring charge and a $33.3 million loss. Louisiana Land & Exploration Co. is a corporation applicant based in New Orleans, Louisiana for 66 closed leases. The following June a wholly owned subsidiary of LL&E, the Sun Fire Coal Company, began to develop an underground mine near Hazard, Kentucky. There are no known limits on the percentage of hydrogen sulfide a well can contain and still remain economically viable as a source of oil and gas. Forbes called Copper Range "a company so bad that some analysts wondered whether it was acquired to make Louisiana Land unattractive as a takeover candidate." COMMISSIONER OF INTERNAL REVENUE, RESPONDENT, United States Tax Court.https://leagle.com/images/logo.png. 613(b)(1)(A). descent) and Cajuns (descendants of French Acadians driven from Construction began on a new catalytic reformer that would provide more highly valued refined products. A number of travel relations by 17th and 18th century Congress also was concerned, however, with the shortage of hydrocarbon fuels and the need to encourage domestic exploration for and exploitation of new sources of fuel.
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