An Alaska judge today issued another major ruling in the long-running dispute over the value of the trans-Alaska pipeline system for property tax purposes, and the owners appear to have taken another defeat.
The 216-page ruling from Superior Court Judge Sharon Gleason of Anchorage comes after a nine-week trial this fall focusing on the value of TAPS for the years 2007, 2008 and 2009.
The concluding paragraph of the decision says the “full and true value” of TAPS “with due regard to the economic value of the property based on the estimated life of the proven reserves of gas or unrefined oil then technically, economically, and legally deliverable into the transportation facility” is $8.94 billion for 2007, $9.64 billion for 2008 and $9.25 billion for 2009.
Those figures are far above what the owners argued the system was worth. They asserted the assessed value of TAPS should be no greater than $1.3 billion for any of the three tax years at issue, Gleason’s ruling says.
The owners went to court to challenge how state officials calculate the value of Alaska’s most essential industrial asset, which has been carrying North Slope crude oil since 1977.
The ruling is the second in recent times to go against the owners. In May 2010, Gleason pegged the value of TAPS for 2006 at $9.98 billion.
The rulings constitute victories for the state and for municipal governments along the 800-mile pipeline route, as higher valuations mean greater property tax collections.
Bill Walker, an attorney for the city of Valdez, told Petroleum News with respect to today’s ruling: “We’re very pleased with it.”
The five companies holding ownership stakes in TAPS are BP, ExxonMobil, ConocoPhillips, Chevron and Koch Industries.
See story in Jan. 8 issue, available online at 11 a.m., Friday, Jan. 6, at www.PetroleumNews.com