00                            HOUSE BILL NO. 351                                                                          
01 "An Act relating to nontransferable credits that may be applied against a liability for an                              
02 oil and gas production tax."                                                                                            
03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
04    * Section 1. AS 43.55.024(g) is amended to read:                                                                   
05            (g)  A tax credit authorized by (c) or (i) of this section may not be applied to                         
06       reduce a producer's tax liability for any calendar year under AS 43.55.011(e) below                               
07       zero.                                                                                                             
08    * Sec. 2. AS 43.55.024 is amended by adding a new subsection to read:                                              
09            (i)  For production from a qualifying lease or property for which a producer's                               
10       tax liability determined under AS 43.55.011(e) is greater than zero after the                                     
11       application of a credit under (a) or (c) of this section and before application of any                            
12       other credits in this chapter, a producer that qualifies under (e) of this section may take                       
13       the tax credit authorized by this subsection against a tax liability under                                        
14       AS 43.55.011(e). The credit may be taken for the calendar year in which the                                       

01       qualifying lease or property first produced oil and gas in paying quantities and for the                          
02       nine calendar years immediately following. Against a liability under                                              
03       AS 43.55.011(e)(1), the amount of credit is equal to 25 percent of the annual                                     
04       production tax value of all oil and gas produced by the producer determined under                                 
05       AS 43.55.160(a)(1) for all leases and properties, multiplied by the new production                                
06       credit factor. Against a liability under AS 43.55.011(e)(2), the amount of credit is                              
07       equal to the amount of tax due under AS 43.55.011(e)(2) multiplied by the new                                     
08       production credit factor. In this subsection,                                                                     
09                 (1)  the amount of oil and gas produced is measured in BTU equivalent                                   
10       barrels; and                                                                                                      
11                 (2)  "new production credit factor" means a fraction, the numerator of                                  
12       which is the total amount of oil and gas for the calendar year produced by the producer                           
13       from all qualifying leases or properties, and the denominator of which is the total                               
14       amount of all oil and gas produced by the producer for the calendar year from all                                 
15       leases or properties;                                                                                             
16                 (3)  "qualifying lease or property" means a lease or property that did                                  
17       not have oil and gas production in paying quantities before 2012.