(A salt dome is a raised central area of salt or rock, around which beds of sedimentary rock dip in all directions. fertile delta lands; further inland are plains and low rolling The state's principal agricultural outputs include seafood 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. Section 613(b)(7) is a catch-all provision for minerals not mentioned elsewhere in the subsection. The term "subject to," in its ordinary sense, means "subordinate to" or "governed or affected by". But while business was very good in the late 1970s there were doubts about LL&E's future. Forbes criticized the offer, charging that the company had waited too long to get into explorations and would be left with expensive deeper water wells. TEXACO, INC. Court of Appeal of Louisiana, Fourth Circuit.https://leagle.com/images/logo.png. Hydrogen sulfide is never used as a fuel and is not sold under long-term fixed price contracts. hills; over half the land area forested, supporting a major lumber and 22 percent shall be deemed to be specified in subsection (b) of section 613 for purposes of subsection (a) of that section. This definition encompasses both hydrocarbon and nonhydrocarbon gases. LL&E traces its roots to the 19th century, when midwestern businessman Edward Wisner moved to Louisiana for his health. La Land 47, however, amended section 613 and added a new section 613A8 so that oil and gas no longer qualified for percentage depletion pursuant to section 613. LL & E, which leases certain lands to Texaco for the production of gas, brought suit against Texaco claiming Texaco had failed to pay proper royalties under the leases. James Learn more about the Bureau of Land Management, Public Land Survey System, and oil and gas leases. Rec. Principal Subsidiaries: CL&E Corp.; Inexco Oil Co.; Wilson Bros. Drilling Co.; Molokai California Ltd.; LLOXY Holdings, Inc.; White Pine Leasing, Inc.; LL&E Properties, Inc.; Westport Utilities Systems Co., Inc.; LL&E (Netherlands) Inc.; CLAM Petroleum Co.; MaraLou Netherlands Partnership (50%). LAND EXPLORATION CO Rul. By 1970, an oversupply of sulphur seriously depressed prices,4 but the sulphur market recovered and the price of sulphur rose dramatically in the late 1970's and early 1980's.5. Louisiana Land and Exploration Company LOUISIANA LAND Sec. As LL&E operations grew, both sales and revenues increased. That year the company also saw initial returns from both the tertiary recovery project at Jay Field and the "A" platform of the Brae Field in the North Sea. William M. Linden, Ewing Werlein, Jr., Christine L. Vaughn, John W. Leggett, and Elaine Drodge Koch, for the petitioners. Phillips Petroleum Co. Poydras Energy Partners, LLC Shoreline Southeast LLC Tenneco Inc. Texaco, Inc. Union Pacific Resources Co. Drilling wells, permits, operators and production information can give you an Congress chose 6,000 to one as the conversion ratio because one barrel of oil has the equivalent heating value of 6,000 cubic feet of "natural gas." Claus sulphur recovery plants, however, were not economically attractive investments until the value of sulphur began to rise significantly in the 1960's. The typical well stream in the Jay Field contains approximately 8.5 percent hydrogen sulfide and 2.2 percent carbon dioxide. WebThe company changed its name to St. Mary Land & Exploration Company on October 13, 1992 and then shortly thereafter, went public on the NASDAQ exchange with the ticker symbol MARY. 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. denied 382 U.S. 892 (1965). Shell Oil Co., v. Williams, 428 So.2d 798 (La.1983). At year's end, he was able to salvage earnings of $76.3 million despite mining operations that sustained a pretax loss of $38 million. Oil and Gas lease entities located at the same street address in New Orleans, Louisiana as Louisiana Land & Exploration Co.. 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. Sulphur dioxide is a gas with an objectionable odor and which can damage both animals and plants. Lease handled by the Bureau of Land Management are not mapped by latitude and longitude, instead, these leases harken back to the Public Land Survey System. Section 613(b) in general provides the list of minerals that are eligible for percentage depletion and specifies the percentage depletion rates. Respondent thus concludes that if hydrogen sulfide, from which sulphur is derived, is produced from an oil or gas well, it is depletable, if at all, only under section 613A. In the early 1980s, industry economics changed LL&E's fortunes. The main lodge located at The Island was built entirely from cypress logged and timbered from the Des Allemands area. The Drillings accepts no liability for the content of this data, or for the consequences of any actions taken on the basis of the information provided. 1971). (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. The same year he paid $486 million for Inexco Oil Co., an oil company with reserves that included 9.9 million barrels of liquids and 392.7 million cubic feet of domestic natural gas reserves. United States v. American Trucking Association, 310 U.S. 534, 543 (1940). 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. Louisiana Land & Exploration Co. is a corporation lessee based in New Orleans, Louisiana for 11 oil and gas leases8 are authorized and 2 are closed. Oil and Gas lease entities located near Louisiana Land & Exploration Co.. This professionalism is the result of corporate leadership, teamwork, open communications, customer/supplier partnership, and state-of-the-art manufacturing. The amine solution absorbs the hydrogen sulfide and carbon dioxide and natural gas flow out of the top of the contactor. During the House debates, Representative Rhodes noted "that one of the reasons for this bill being brought here with some haste is the fact that we have a shortage of domestic petroleum." The Drillings is a resource for locating where oil and gas leases are and have been. On November 7, 1938, LL&E and Texaco amended their contract. 95, respondent considered whether carbon dioxide extracted from a carbon dioxide well for injection into oil fields as a drive mechanism for the recovery of oil is eligible for depletion pursuant to section 613 or section 613A. 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. Respondent argues that hydrogen sulfide has no commercial value before it is converted into elemental sulphur and that it is not possible to compute gross income from sulphur at the well-mouth because sulphur has not been produced at that point. The data and maps may not be used to determine title, ownership, legal descriptions or boundaries, legal jurisdiction, or restrictions that may be in place on either public or private land. Land Saline an economic revolution in the early 1900s when large deposits of Petitioners rightly assumed that the issue was settled and cannot now justly be required to prove the amount of the depletion deduction to which we have found they are entitled. 16. The capital stock of LL E is registered with the Securities and Exchange Commission ("SEC") and is traded on the New York Stock Exchange. While this revenue ruling does not squarely set forth respondent's position on the facts of this case because in the ruling the carbon dioxide was not produced from an oil and gas well, the ruling directly states respondent's reading of section 613A as applying only to hydrocarbon fuels and of section 613(b)(7) as applying only to minerals not expressly provided for elsewhere in subsection (b). Although this Court will disregard a stipulation that is plainly contrary to the facts (Jasionowski v. Commissioner, 66 T.C. Sulphur has been recovered from hydrogen sulfide and sold as a by product of the processing facilities since the facilities were placed in operation. In addition, in December 1976 LL&E acquired the Warrior River Coal Company, owners of a small surface mine in Tuscaloosa, Alabama. 613A(c)(4). Deteriorating economic conditions, windfall profits taxes, high dry hole costs, narrower profit margins, and declining demand all pressured earnings. For the purposes of this subsection, minerals (other than sodium chloride) extracted from brines pumped from a saline perennial lake within the United States shall not be considered minerals from an inexhaustible source. Natural gas is measured and sold by standard cubic feet. The oil stabilization system also reduces the vapor pressure of the crude oil to a low enough level that it can be stored and transported in atmospheric tanks and tank trucks. 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. Current estimates show that the unit has a sales volume of $1500000 and staff of approximately 17 people. area, List of school districts in Sec. Congress responded to this public outcry by repealing the percentage depletion allowance as applied to the major integrated oil companies.". In addition to Texaco, which was still its major leaseholder, LL&E secured royalty agreements with Phillips Petroleum Co., Stanolind Oil & Gas Co., Alder Oil Co., and Plymouth Oil Co., among others. In addition to the Texaco royalties, which were still significant (of 25 Lake Barre Field wells Texaco completed in 1964, 21 produced oil, two produced gas and only two were dry), LL&E had signed royalty agreements with Union Oil of California, Signal Oil, Amarada Hess, and Humble Oil and Refining. 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. Following respondent's reasoning, "natural gas" for purposes of section 613A means any product extracted from an oil and gas well in a gaseous state. Hydrogen sulfide, alone, or in combination with natural gas is also unsuitable for use as a fuel because the combustion of hydrogen sulfide produces sulphur dioxide, a toxic substance subject to control under Federal pollution standards. 7801 (remarks of Senator Bartlett) (criticizing amendment for altering percentage depletion only for oil and gas industry); 121 Cong. One barrel of oil has the equivalent fuel value, measured in British Thermal Units (BTU's) of 6,000 standard cubic feet of natural gas.6. L. 69-20, sec. Louisiana. 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: 346 F.2d 377 (5th Cir. Department of Natural Resources | State of Louisiana It is true that the statutory language on its face is incongruous. by Fr. Such allowance shall not exceed 50 percent of the taxpayer's taxable income from the property (computed without allowance for depletion). In 1984, large additions and renovations were made to the lodge, increasing the size of the camp to accommodate more guests. (Cf. Epps. "It was a very unusual contract for 1928," LL&E president Ford Graham told Dun's Review in 1965. Section 613A(b), providing percentage depletion for "regulated natural gas" and "natural gas sold under a fixed contract" also makes sense only if section 613A applies solely to hydrocarbon fuels. Through its subsidiary, The Louisiana Land and Exploration Company LLC (LL&E), ConocoPhillips is the largest private wetlands owner in Louisiana. The LOUISIANA LAND AND EXPLORATION COMPANY The Copper Range acquisition did not please the financial community. And they paid us a $4 million bonus on the lease!". The company continued to look for new sources of oil and in October 1972 newly named CEO John G. Phillips announced a $75 million offering to finance a new subsidiary, Louisiana Land Offshore Exploration Co. (Lloxy), that would explore for oil and gas in the Gulf of Mexico. Mascrier), Fr. The brine water is reinjected into the well. In 1975 the Kalua Koi Corporation, LL&E's 50-percent-owned Hawaiian operation, began construction on the first phase of a 298-unit hotel condominium complex. It continued, however, with its policy of contracting other firms to perform seismic surveys and other exploration and development tasks. Sulphur is mentioned once in the congressional debates as part of a list of 108 mineral extractive industries for which percentage depletion was retained. Subparagraph (C), which states the oil and gas well exception from depletion, states simply "oil and gas wells." Pub. Senator Hollings, a cosponsor of the amendment, added that "not one of those minerals [for which the depletion allowance was retained] has had a four-fold increase in price" as oil and natural gas had in the early 1970's. Furnel, Inc. has been successfully implementing this policy through honesty, integrity, and continuous improvement. 4638 (1975); S. Rept. Continuing to diversify, in 1968 Graham obtained the rights to participate in the resort development of approximately 50,000 acres on the western half of Molokai Island, Hawaii--an island previously best known for its leper colony. Rec. Spots was recovered from an adjoining area in 1986 by the original land owners, Louisiana Land and Exploration Company, and lived on the grounds until he was donated to the Audubon Zoo in 1990. Wisner's plans, however, were thwarted by southern Louisiana's severe weather. Rec. Phillips, meanwhile, continued to diversify. Natchez, Jean Lafitte National Historical Park and Moreover, because petitioners do not qualify for percentage depletion under the exemptions set forth in section 613A(b) and section 613A(c), the sulphur is also not eligible for percentage depletion under section 613A. v. 121 Cong. Respondent's view may be a valid literal reading of section 613A(e)(2). Court of Appeal of Louisiana, Fourth Circuit. This appeal stems from the granting of a motion for partial summary judgment in favor of the Louisiana Land and Exploration Company (LL & E). Despite dramatic increases in construction and operating costs of Claus sulphur recovery facilities since 1968, the sulphur recovery industry has continued to grow, partly because air-pollution controls mandate the recovery of sulphur from the hydrogen sulfide removed from oil and gas wells even when it may not be economically attractive to do so. 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. Not satisfied? 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. Business Week called Louisiana Land's record "dismal" and noted that despite spending $1.4 billion over the previous four years Phillips had failed to increase oil and gas reserves. 121 Cong. Caspary's charges had some legitimacy. In 1935, after Texaco had been fully reimbursed, LL&E paid its first dividends. 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 LA ), among them The primary products from the Jay Field wells and processing facilities have been oil and natural gas. The Louisiana Land and Exploration Company LLC operates as a subsidiary of ConocoPhillips. Follow In 1989, the company spun off Plum Creek Rec. The carbon dioxide is vented to the atmosphere. rice, sugar cane, sweet potatoes, cotton, cattle, dairy products; French explorers, among whom the following at least should (c) EXEMPTION FOR INDEPENDENT PRODUCERS AND ROYALTY OWNERS., (1) IN GENERAL.Except as provided in subsection (d), the allowance for depletion under section 611 shall be computed in accordance with section 613 with respect to. WebDetails for well Sweet Lake Land And Oil Co 001 | API # 17-023-20688 | operated by McMoran Exploration Company in Cameron Parish, LA. (Lafayette), New Orleans Jazz National Historical 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. When a literal reading of a statute conflicts with expressed congressional intent and common usage, we will reject it. The user is responsible to verify the limitations of the geospatial data and to use the data accordingly. Outside of Louisiana, Youngs acquired mineral rights and royalty interests on 152,870 acres in Texas, New Mexico, North Dakota, South Dakota, Montana, Colorado, Florida, and Mississippi. LOUISIANA Co. Linder Oil Co. A Partnership P.C.S.I. Rec. And when we're finished we don't own the computer or have the people on our permanent payroll. A township can refer to two different things. 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. The sulphur is then condensed and stored until sold. The Claus system chemically converts more than 96 percent of the hydrogen sulfide into elemental sulphur. Respondent interprets section 613A(e) as follows: Section 613A(e)(2) provides a definition; it is not an allowance section. Commissioner v. Engle, 464 U.S. 206, 218 (1984). The LL & E leases require Texaco to pay royalties based upon a percentage of the value of the gas produced. Listed below are the cases that are cited in this Featured Case. WebLouisiana Land & Exploration Co LLC/The - Company Profile and News - Bloomberg Markets Bloomberg Connecting decision makers to a dynamic network of information, people and Forbes later criticized the Jacintoport purchase, maintaining that LL&E had gotten into industrial real estate, "just at the time when the play was going out of it along the Gulf Coast.". This web site and associated pages are not associated with, endorsed by, or sponsored by The Louisiana Land And Exploration Company and has no official or unofficial affiliation with The Louisiana Land And Exploration Company. The well effluent from the Jay Field wells is treated in facilities adjacent to the wells. In the Senate, Senator Dole remarked that "The 2,000 barrel * * * exemption from the depletion allowance repeal is vitally important to maintaining a high level of energy exploration and production," 121 Cong. counties); the Pelican State; name (after Louis XIV of France) In the 1950s, CEO Robert M. Youngs began to guide LL&E into other exploration, both on its own lands and on land it leased in other U.S. areas of production. Leagle.com reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions. Congress' goal of encouraging domestic production would in that event be thwarted. In 1928 LL&E signed a contract with Texas Co. (now Texaco) in which that company agreed to lease all of LL&E's acreage around ten productive salt domes. All Rights Reserved Petitioners, the Louisiana Land & Exploration Co. (LL&E) and Subsidiaries, are an affiliated group of corporations whose common parent is LL&E. Escalating energy prices and the Arab oil embargo awakened the public to the Nation's growing reliance on foreign energy resources. Percentage depletion for natural resources has been a part of the Internal Revenue Code since the Revenue Act of 1926. Section 613A(e) defines crude oil and natural gas for purposes of section 613A. Rec. In a vessel called a contactor, an amine solution such as sulfinal is added to the sour gas. The problem in this case arose because Texaco, in an effort to secure a market for natural gas when it was not a particularly valuable commodity, entered into long term sales agreements with Louisiana industrial consumers promising future delivery of gas at what are now below-market prices. About Our Hunting Lodge in Paradis, LA | The Island v. Louisiana Land and Exploration Co 204(c)(2), 44 Stat. Congress did not intend to take any tax benefit away from independent producers in approving section 613A. 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 The Louisiana Land and Exploration Company -- Company We conclude that in drafting section 613A, Congress intended to limit percentage depletion only for income from hydrocarbon fuels. WebThe La Land & Exploration Co U 004: API No. 4606 (1975). In 1943, for instance, LL&E employed only 24 people, yet earned $1.8 million on sales of $3.4 million. As LL&E expanded its exploration efforts (by 1974 it was exploring in southern Louisiana, the Rocky Mountain area, a geological stratum from northern Louisiana to Florida, and off the coasts of Louisiana and Texas) it began to act as operator in an increasing number of its working interest efforts. Oil and gas have been extracted from wells containing a trace quantity of hydrogen sulfide and from wells containing as much as 90-percent hydrogen sulfide. Depletion generally is calculated based on the cost of the property. At that time, the lodge housed The Louisiana Land and Exploration Company LLC revenue is $280.0M annually. Louisiana v. Louisiana Land & Exploration Co. et al. These geospatial data and related maps or graphics are not legal documents and are not intended to be used as such. Click on the case name to see the full text of the citing case. 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. After reviewing the law and the facts, we find that the district court was correct in its determination. Sulphur is depletable pursuant to section 613(b)(1) and not section 613(b)(7). The town of Paradis, LA traces its history back to 1856 whenEdouard Paradis came down from Quebec, Canada to provide crossties for the railroads being constructed in St. Charles Parish. The extent of the damages, if any, suffered by LL & E must be determined in a further proceeding. The goal of the legislation was to continue to provide the tax incentive of percentage depletion to small producers and royalty owners to encourage exploration for and exploitation of domestic oil and gas reserves while eliminating such tax incentives for the major integrated oil companies. 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." Section 613(b)(7), however, does not appear to exclude from percentage depletion under section 613 all minerals from oil and gas wells. 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. 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. 7807. In Rev. Section 613A bars percentage depletion for oil and gas wells with two exceptions. The practice in the oil and gas industry when section 613A was enacted was to sell hydrocarbon gas for use as fuel under long-term fixed price contracts.
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