Duke Energy Natural Gas Corp. v. Commissioner

LUCERO, Circuit Judge.

Duke Energy Natural Gas Corporation (“Duke”), a Denver-based company, appeals an adverse Tax Court judgment requiring it to depreciate the value of its natural gas gathering systems over fifteen rather than seven years because those assets transport, rather than produce, gas. Exercising our jurisdiction to review the Tax Court’s decision under 26 U.S.C. § 7482, we reverse and hold that gathering systems are assets used in the exploration for and production of petroleum and natural gas deposits for purposes of the Internal Revenue Code’s Modified Accelerated Cost Recovery…