(1) Bids for new rigs will be solicited from manufacturers of work-over and service rigs to determine current replacement costs based on the depth rating listed below. For each depth rating listed below of work-over and service rigs, there will be two replacement cost categories. One category will represent current replacement cost of a service rig and the second category will represent current replacement cost of a work-over rig. Each rig, as it is assessed, will be placed in one category or another based on its depth.

 

DEPTH CATEGORIES

 

Class		Depth Capacity
1	. . . . . . . . . . . . . . . . . . . . . . . . . . .	0 to 3,000 ft.
2	. . . . . . . . . . . . . . . . . . . . . . . . . . .	3,001 ft. to 5,000 ft.
3	. . . . . . . . . . . . . . . . . . . . . . . . . . .	5,001 ft. to 8,000 ft.
4	. . . . . . . . . . . . . . . . . . . . . . . . . . .	8,001 ft. to 10,000 ft.
5	. . . . . . . . . . . . . . . . . . . . . . . . . . .	10,001 ft. to 14,000 ft.
6	. . . . . . . . . . . . . . . . . . . . . . . . . . .	14,001 ft. and over

 

 DEPTH CATEGORIES AND REPLACEMENT COST NEW

 

MANUFACTURER'S	SERVICE	WORKOVER
DEPTH RATING	RIG R.C.N	RIG R.C.N
0    -      3,000 ft	$ 146,788	$ 186,788
3,001 ft. -    5,000 ft	187,336	227,336
5,001 ft. -     8,000 ft	245,572	305,572
8,001 ft. -   10,000 ft	293,325	393,325
10,001 ft. - 14,000 ft	322,918	472,918
14,001 ft. and over	405,426	555,426

 

Pole rigs and cable tool rigs, regardless of depth, are $60,000 R.C.N. These replacement costs will then be depreciated to arrive at market value according to the schedule mentioned in (2).

(2) The department shall prepare a ten-year trended depreciation schedule for work-over and service rigs. The trended depreciation schedule shall be derived from depreciation factors published by "Marshall and Swift Publication Company". The "% good" for work-over and service rigs less than one year old shall be 100%.

(3) In any year that the information required in (1) is not available for use by the department, work-over and service rigs shall be valued by using the schedule from the previous year.

(4) For self-propelled wheeled work-over and service rigs, an additional 80% wholesale factor shall be used in determining market value in conjunction with the schedules mentioned in (2).

(5) The trended depreciation schedule referred to in (2) and (4) is listed below and shall be used for tax year 2008.

 

SERVICE AND WORKOVER RIG TRENDED DEPRECIATION SCHEDULE

 

				TRENDED
YEAR NEW/		TREND	WHOLESALE	WHOLESALE
ACQUIRED	% GOOD	FACTOR	FACTOR	% GOOD
2008	100%	1.000	80%	80%
2007	92%	1.000	80%	74%
2006	84%	1.053	80%	71%
2005	76%	1.106	80%	67%
2004	67%	1.200	80%	64%
2003	58%	1.242	80%	58%
2002	49%	1.267	80%	50%
2001	39%	1.274	80%	40%
2000	30%	1.286	80%	31%
1999	24%	1.307	80%	25%
1998 and older	20%	1.313	80%	21%

 

(6) This rule is effective for tax years beginning after December 31, 2007.