Rule 10
Depreciation Of Capital Costs
10. Depreciation of Capital Costs:
(1) Capital Costs may be depreciated beginning with the first Accounting Period or the Accounting Period in
which the asset is placed in service, whichever is later, as follows:
(a) Exploration Capital Costs immediately.
(b) Capital Cost incurred for drilling, testing, and completing development wells over a period of Four years.
(c) All other Capital Costs over a period of Six years.
(2) Depreciation shall be calculated on a straight line basis.
(3) The undepreciated Capital Costs of an asset taken out of service shall be depreciated on the basis described above. In the case such assets are subject to unexpected loss or destruction, the undepreciated value may
be deducted as Current Operating Costs in the year of such loss or destruction
(1) Capital Costs may be depreciated beginning with the first Accounting Period or the Accounting Period in
which the asset is placed in service, whichever is later, as follows:
(a) Exploration Capital Costs immediately.
(b) Capital Cost incurred for drilling, testing, and completing development wells over a period of Four years.
(c) All other Capital Costs over a period of Six years.
(2) Depreciation shall be calculated on a straight line basis.
(3) The undepreciated Capital Costs of an asset taken out of service shall be depreciated on the basis described above. In the case such assets are subject to unexpected loss or destruction, the undepreciated value may
be deducted as Current Operating Costs in the year of such loss or destruction