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its returns for 1983, 1984, and 1986 because that change is
a change of accounting method for which petitioner did not
obtain the consent of the Secretary, as required by section
446(e). Respondent notes that beginning in 1983 and
continuing until 1993 when petitioner sold Cordero, a
period of approximately 11 years, petitioner consistently
accounted for all of its overburden removal costs at the
Gillette mine as mine development costs within the meaning
of section 616(a), and it capitalized and amortized a
portion of those costs, as required initially by section
291(b) and later by section 59(e). Respondent acknowledges
that the subject overburden removal costs should have been
treated as production costs, but, respondent asserts, the
proposed change constitutes an impermissible retroactive
change in a method of accounting in contravention of
section 446(e). According to respondent, the fact that
petitioner’s tax accounting method is erroneous does not
justify petitioner’s abandonment of this longstanding
method of accounting for such costs without the consent
of the Secretary required by section 446(e).
Respondent acknowledges that the prior consent
requirement of section 446(e) applies only if the change
constitutes a change in method of accounting. Respondent
argues that the change which petitioner proposes to make in
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