Nielson-True Partnership, True Oil Company, Tax Matters Partner - Page 18

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             formation gas was revoked by the Natural Gas Wellhead Decontrol                                      
             Act of 1989 (Decontrol Act), Pub. L. 101-60, sec. 3(b)(5), 103                                       
             Stat. 157, 159, effective January 1, 1993.  In other words,                                          
             petitioner argues that FERC and the relevant local regulatory                                        
             agencies did not have the authority to issue well-category                                           
             determinations after that date.  Petitioner also argues that, as                                     
             a general matter, the Omnibus Budget Reconciliation Act of 1990,                                     
             Pub. L. 101-508, sec. 11501, 104 Stat. 1388-479, extended and                                        
             liberalized the availability of the tax credit for tight                                             
             formation gas for wells drilled before January 1, 1993.  In that                                     
             regard, the section 29 credit for tight formation gas is                                             
             allowable beyond January 1, 1993.                                                                    
                    Conversely, respondent points out that FERC announced that                                    
             it would continue processing well-category determinations until                                      
             January 1, 1993, in order for producers to qualify for                                               
             nonconventional fuels tax credits.  FERC Order No. 523, 55 Fed.                                      
             Reg. 17425 (Apr. 25, 1990).  Respondent also relies on                                               
             legislative history in connection with the repeal of the                                             
             incentive-pricing provisions of the NGPA containing the statement                                    
             that the repeal was not intended to affect the availability of                                       
             the nonconventional fuels tax credit.  See S. Rept. 101-39, at 9                                     
             (1989).  Finally, respondent points out that Congress considered                                     
             making the nonconventional fuels tax credit permanent but                                            
             extended for only 2 years the time within which a well had to be                                     
             drilled to qualify.  This extension was intended to coincide with                                    

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