State Taxation: Severance Tax; Calculation Administrative Law: Exhaustion of Administrative Remedies Administrative Law: Primary Jurisdiction Doctrine

摘要

ExxonMobil owns and operates various deep natural gas wells in Sublette County, Wyoming as part of its LaBarge project. The gas stream composed of carbon dioxide, helium and methane also contains hydrogen sulfide. Without expensive treatment and processing the methane is unusable. In the mid-1980s ExxonMobil invests more than one billion dollars in transportation and processing facilities in Sublette and neighboring Lincoln counties. Because of the high infrastructure costs and low commodity prices, when the netback methodology is used to determine severance tax liability, the value of the natural gas is zero and thus no tax is owed.