[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 611 Introduced in House (IH)]
111th CONGRESS
1st Session
H. R. 611
To provide for marginal well production preservation and enhancement.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 21, 2009
Mr. Boren introduced the following bill; which was referred to the
Committee on Ways and Means, and in addition to the Committees on
Energy and Commerce and Transportation and Infrastructure, for a period
to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the
committee concerned
_______________________________________________________________________
A BILL
To provide for marginal well production preservation and enhancement.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Marginal Well Production
Preservation and Enhancement Act''.
SEC. 2. TAX TREATMENT FOR PROLONGED MARGINAL PRODUCTION.
(a) Increase in Percentage Depletion for Oil and Natural Gas
Produced From Marginal Properties.--
(1) In general.--Paragraph (6) of section 613A(c) of the
Internal Revenue Code of 1986 (relating to oil and natural gas
produced from marginal properties) is amended to read as
follows:
``(6) Oil and natural gas produced from marginal
properties.--
``(A) In general.--Except as provided in subsection
(d)--
``(i) the allowance for depletion under
section 611 shall be computed in accordance
with section 613 with respect to the taxpayer's
marginal production of domestic crude oil and
domestic natural gas, and
``(ii) 27.5 percent shall be deemed to be
specified in subsection (b) of section 613 for
purposes of subsection (a) of that section.
``(B) Coordination with other production of
domestic oil and natural gas.--For purposes of this
subsection--
``(i) no allowance for depletion shall be
allowed by reason of paragraph (1) with respect
to the taxpayer's marginal production of
domestic crude oil and domestic natural gas,
and
``(ii) such production shall not be taken
into account--
``(I) in determining under
paragraph (1) how much of the
taxpayer's depletable oil quantity or
depletable natural gas quantity has
been used, or
``(II) for purposes of applying
subparagraph (A), (B), or (C) of
paragraph (7).
``(C) Marginal production.--The term `marginal
production' means domestic crude oil or domestic
natural gas which is produced during any taxable year
from a property which--
``(i) is a stripper well property for the
calendar year in which the taxable year begins,
or
``(ii) is a property substantially all of
the production of which during such calendar
year is heavy oil.
``(D) Stripper well property.--For purposes of this
paragraph, the term `stripper well property' means,
with respect to any calendar year, any property with
respect to which the amount determined by dividing--
``(i) the average daily production of
domestic crude oil and domestic natural gas
from producing wells on such property for such
calendar year, by
``(ii) the number of such wells,
is 15 barrel equivalents or less.
``(E) Heavy oil.--For purposes of this paragraph,
the term `heavy oil' means domestic crude oil produced
from any property if such crude oil had a weighted
average gravity of 20 degrees API or less (corrected to
60 degrees Fahrenheit).
``(F) Nonapplication of taxable income limit with
respect to marginal production.--The second sentence of
subsection (a) of section 613 shall not apply to so
much of the allowance for depletion as is determined
under subparagraph (A).''.
(2) Conforming amendments.--
(A) Section 613A(c)(3) of the Internal Revenue Code
of 1986 (defining depletable oil quantity) is amended
to read as follows:
``(3) Depletable oil quantity.--For purposes of paragraph
(1), the taxpayer's depletable oil quantity shall be 1,000
barrels.''.
(B) Subparagraphs (A) and (B) of section 613A(c)(7)
of such Code are each amended by striking ``or (6), as
the case may be''.
(3) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after December 31, 2008.
(b) 1-Year Extension of Suspension of Taxable Income Limit.--
Section 613A(c)(6)(H)(ii) of the Internal Revenue Code of 1986
(relating to temporary suspension of taxable income limit with respect
to marginal production) is amended by striking ``2010'' and inserting
``2011''.
SEC. 3. OIL AND GAS WELLS AND PIPELINE FACILITIES TECHNICAL AMENDMENT.
Section 112(n)(4)(A) of the Clean Air Act (42 U.S.C. 7412(n)(4)(A))
is amended by striking ``this section'' and inserting ``this Act''.
SEC. 4. NATIONAL RESPONSE SYSTEM.
Section 311(j) of the Federal Water Pollution Control Act (33
U.S.C. 1321(j)) is amended by striking paragraph (1) and inserting the
following:
``(1) System.--
``(A) Definition of wastewater treatment
facility.--In this paragraph, the term `wastewater
treatment facility' includes produced water from an oil
production facility.
``(B) Regulations.--Consistent with the National
Contingency Plan required under subsection (d), as soon
as practicable after the effective date of this
section, and from time to time thereafter, the
President shall promulgate regulations consistent with
maritime safety and marine and navigation laws--
``(i) establishing methods and procedures
for removal of discharged oil and hazardous
substances;
``(ii) establishing criteria for the
development and implementation of local and
regional oil and hazardous substance removal
contingency plans;
``(iii) establishing procedures, methods,
and requirements and other requirements for
equipment to prevent discharges of oil and
hazardous substances from vessels and from
onshore facilities and offshore facilities
(other than wastewater treatment facilities),
and to contain those discharges; and
``(iv) governing the inspection of vessels
carrying cargoes of oil and hazardous
substances and the inspection of those cargoes
in order to reduce the likelihood of discharges
of oil from vessels in violation of this
section.
``(C) Small facilities.--In carrying out clause
(iii) of subparagraph (B), not later than 1 year after
the date of enactment of that clause, the Administrator
shall establish procedures, methods, and equipment
requirements and other requirements for, and consider
the cost-effectiveness of those requirements on, small
facilities (including agricultural and oil production
facilities) to prevent discharges from facilities and
offshore facilities, and to contain those discharges,
by developing regulations based on storage volume and
capacity that, with respect to those small facilities--
``(i) apply to any facility the total oil
storage capacity of which is at least 1,320
gallons but less than 50,000 gallons, and at
which no single tank exceeds a nominal capacity
of 21,000 gallons; and
``(ii) establish minimal requirements and
plans by eliminating engineer certification,
flow lines, loading and unloading areas,
integrity testing, and other requirements, as
determined by the Administrator, that do not
take into consideration and meet cost-
effectiveness standards.''.
SEC. 5. RECOVERY PERIOD FOR DEPRECIATION OF PROPERTY USED TO INJECT
QUALIFIED TERTIARY INJECTANTS.
(a) In General.--Section 168(e)(3)(A) of the Internal Revenue Code
of 1986 (defining 3-year property) is amended by striking ``and'' at
the end of clause (ii), by striking the period at the end of clause
(iii) and inserting ``, and'', and by adding at the end the following
new clause:
``(iv) any qualified tertiary injectant
property.''.
(b) Qualified Tertiary Injectant Property.--Section 168(e) of the
Internal Revenue Code of 1986 (relating to classification of property)
is amended by adding at the end the following new paragraph:
``(9) Qualified tertiary injectant property.--The term
`qualified tertiary injectant property' means--
``(A) any property--
``(i) the principal use of which is to
inject any tertiary injectant as a part of a
tertiary recovery method (as defined in section
193(b)(3)), or
``(ii) which is a pipeline used to carry
any tertiary injectant in connection with such
tertiary recovery method, and
``(B) which has a class life of more than 4
years.''.
(c) Alternative System.--The table contained in section
168(g)(3)(B) of the Internal Revenue Code of 1986 is amended by
inserting after the item relating to subparagraph (A)(iii) the
following new item:
``(A)(iv).............................................. 7''.
(d) Effective Date.--The amendments made by this section shall
apply to property placed in service after the date of the enactment of
this Act, in taxable years ending after such date.
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