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decreased by $2,357, in your fiscal year
ending August 31, 1984.
Lamont Gas Processing Plant
For many years, petitioner purchased propane and
gasoline blending stocks from outside suppliers. The
quality of this fuel was often inconsistent, and there
was often an inadequate supply to meet the needs of
petitioner's patrons. To address these problems,
petitioner decided to manufacture propane and gasoline
blending stock. In 1963, petitioner purchased a natural
gas gathering system near Lamont, Oklahoma, to implement
this plan. After the purchase, petitioner installed an
absorption processing plant on the site. The facility
also included an extensive pipeline system which provided
petitioner access to numerous natural gas producing wells.
In 1981, petitioner added a cryogenic gas processing plant
to its facilities at Lamont which significantly enhanced
the plant's efficiency. We refer to the gathering system,
the absorption processing plant, the pipeline system, and
the cryogenic plant collectively as the Lamont gas plant.
In June 1984, petitioner sold the assets composing
the Lamont gas plant to Union Texas Products Corp. for
$27.1 million. The sale was an arm's-length transaction.
Petitioner used $16 million of the proceeds to build and
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