§ 57-39.2-04.16 — Sales tax exemption for materials used to construct a qualified straddle plant, a qualified fractionator, or qualified associated infrastructure

North Dakota § 57-39.2-04.16

• Jurisdiction: North Dakota
• Title 57: Taxation
• Ch. 57-39.2: Sales Tax

Text

straddle plant, a qualified fractionator, or qualified associated infrastructure.
1. Gross receipts from sales of tangible personal property used to construct or expand a
qualified straddle plant, a qualified fractionator, or qualified associated infrastructure in
this state are exempt from the tax imposed under this chapter. To qualify for the
exemption, the tangible personal property must be incorporated into a qualifying
straddle plant or a qualifying fractionator plant, or used in the construction process to
the point of having no residual economic value. Replacement of tangible personal
property does not qualify for the exemption under this section unless the replacement
creates an expansion of the plant or qualified associated infrastructure.
2. To receive the exemption at the time of purchase, the owner of the plant or qualified
associated infrastructure must receive from the tax commissioner a certificate that the
tangible personal property used to construct the plant qualifies for the exemption. If a
certificate is not received prior to the purchase, the owner shall pay the applicable tax
imposed by this chapter and apply to the tax commissioner for a refund.
3. If the tangible personal property is purchased or installed by a contractor subject to the
tax imposed by this chapter, the owner may apply for a refund of the difference
between the amount remitted by the contractor and the exemption allowed by this
section. Application for a refund must be made at the time and in the manner directed
by the tax commissioner, and must include sufficient information to permit the tax
commissioner to verify the sales and use taxes paid and the exempt status of the sale
or use.
4. For purposes of this section:
a. "Deep cut fractionator" means a plant that processes a mixed natural gas liquids
stream into purity natural gas liquids, including ethane, propane, butane, and
C-five plus.
b. "Expansion" means an increase in production volume, employment, or the type of
products produced.
c. "Qualified associated infrastructure" means:
(1) Natural gas liquid pipelines built to supply mixed natural gas liquids to the
qualified fractionator;
(2) Storage facilities for mixed natural gas liquids that will be processed by the
qualified fractionator;
(3) Storage facilities for purity natural gas liquids, including ethane, propane,
butane, and C-five plus, that are produced by the qualified fractionator;
(4) Disposal facilities built for the qualified fractionator and for onsite purchasers
of the fractionator's processed end-product;
(5) Rail upgrades required for the qualified fractionator and onsite purchasers to
access rail transportation; and
(6) Roads developed for the qualified fractionator, storage facilities, and onsite
customers.
d. "Qualified fractionator" means a deep cut fractionator located in this state with a
daily design capacity of at least forty-five thousand barrels of ethane, fifteen
thousand barrels of propane, thirteen thousand barrels of butane, and three
thousand barrels of C-five plus.
e. "Qualified straddle plant" means a straddle plant located in this state that is either
connected to a qualified fractionator or produces Y-grade liquids that are
dedicated for use by a qualified fractionator.
f. "Straddle plant" means a gas processing plant located on or near a gas
transmission line, which removes residual natural gas liquids from the gas stream
and returns the residue gas to the transmission line.