RE: Alaska oil tax credits6 Jul 2019 12:05
tax credits are legally due, the only question is whether the State pays by the legal formula which will take some years or gets it's bond process through which would enable early repayment with a "haircut".
The credits scheme was set up for small explorers (wells & 3D etc) and producers only, tax credits have already been issued and will ultimately be paid.
extract from annual report to shareholders 2019
"The Alaskan Legislator in 2007 enacted Alaska’s Clear and Equitable Share (“ACES”), in 2013 ACES was amended under Alaskan Statute 43/55. The ACES program was designed to encourage investment in Alaska’s untapped resources by providing tax credits to companies that have qualifying capital expenditure. The ACES program provides up to 85% tax credit for eligible capital expenditure. All expenditure is audited and must be approved by the Alaskan Department of Revenue. Once approved, the benefit can be exercised in one of the following forms: ? Apply the credit against the production tax, hence reducing total production tax liability in a given year; or ? For unused tax credit, apply a transferrable certificate. This certificate does not have an expiry date and can be sold to a new third party; or ? For unused tax credit, apply to sell the tax credit to the Alaskan Department of Revenue.
The ACES rebate is presented separately and deducted from exploration and evaluation assets. As at 31 December 2018, A$26,032,985 (2017; A$19,895,400) is available under the ACES rebate scheme. As at the reporting date, management have considered whether there is any objective evidence as to whether there are any indicators of impairment in accordance with AASB 9 Financial Instruments and believe this amount will be recoverable from the Alaskan DOR as a tax rebate in full based on the current legislative arrangements in Alaska. Management anticipate the rebates to be received in a period greater than 12 months, however the timing of payment is dependent on a statutory minimum formula and government approvals which could be for amounts greater than the minimum. Thus, the tax credit has been classified as a non-current receivable in the Statement of Financial Position."
Of course may not be AEA who directly benefits, but in any negotiations there should be an indirect benefit.
Eg. PANR & GBP
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