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DOE Sells the Project Assets
Once the Supreme Court denied ANR’s petition for writ of
certiorari in the foreclosure litigation, DOE began making plans
to sell the project assets. In a press release dated December 9,
1987, DOE identified 15 potential buyers of the project. One of
these potential buyers was the Coastal Corp. (Coastal), which had
acquired ANRC in March 1985. Ultimately, however, DOE selected
Basin Electric, a North Dakota cooperative, as the successful
bidder. On October 31, 1988, the United States sold the project
assets to two subsidiaries of Basin Electric--Dakota Gasification
Co. and Dakota Coal Co.
The Partnership Continues To Operate
Throughout 1988 and 1989, the partnership’s management,
legal, finance, and tax committees continued to meet and report
to the partners on open issues, including tax issues related to
the project. The partnership’s tax committee concluded that the
partnership ceased to own the project for tax purposes on
November 2, 1987, the date that the Supreme Court denied the
petition for writ of certiorari in the foreclosure proceedings.
Respondent’s September 1986 Letter Ruling
As previously noted, on May 22, 1986, while negotiations
about a possible debt workout were ongoing with DOE, ANR, and
Transco had filed with the IRS a request for a private ruling
regarding potential tax consequences from the partnership’s
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