Arkla, Inc. v. United States

GEE, Circuit Judge:

Arkla, Inc. (Arkla) brought an action in the district court seeking a refund of federal income tax it paid for 1980. The district court granted summary judgment for Ark-la. 592 F.Supp. 502. We reverse.

I

Arkla is an integrated natural gas company providing natural gas to customers in Arkansas, Louisiana, Kansas, Oklahoma, and Texas. To provide for future gas storage needs, Arkla decided to convert a natural underground gas reservoir in eastern Oklahoma known as the “Chiles Dome” facility into a gas storage reservoir. To this end, Arkla acquired from the surface owners the…