R-969


                      EA~~ORNEYGENERAL
                           OF TB-EXAS
                                 AUSTIN    11. TExAe
PRICE  DANIEL
ATTORNEYGENERAL                December 30, 1947


 Hon. George H. Sheppard
 Comptroll~W’of Public Accounts               Opinion No. V-467
 Austin, Texas
                                              Re:      The exemption of gas, burned
                                                       in engines useii for lifting
                                                       oil from the, tax levied
                                                       unaer Art. 7047b, V.C.S.
 Dear Sir:
               Pour opinion    request    dated December 1, 1947,         is aa
 follows   :
               “The question- has arisen
                                  _ .    i? .this department
                                                   _ -
       as to whether gas burned ln engines usea ror
       lifting    oil is exempt from the tax levies under
       Article    7047b R.C.S.
               “Sub-section  (c) of Seatlon 1 (1) of
       Article    7047b excludes gas used for llftlng
       oil, iinless sold for such purpose, ln computing
       the tax tin the business or occupation of pro-
       ducing gas within this State.
              “It is argued that gas used for lease
       operations might well be wFthin the exclusion
       provision     of gas used for llftlng oil.   A pimp-
       ing engine operating a pumping jack uses the gas
       burned to operate the engine for lifting      oil.   I
       shall,    therefore,  thank you to advlse this de-
       partment whether gas consume& in an engine used
       for &Lfting oil is taxable under Article 7047b.
               “Reference     is made to your Opinion O-4151-A."
          The question presented is the use of gas as explained
 in your letter  exempt from the occupation tax imposed ,by ArtLcle
 7047b, by virtue of the exclusion   contained in Subsection c of
 Section 1 of said Article.      ThFs subsection reeds as follows:
            “Gas used for       Lifting    oil,     unless   sold   for
       such purpose.”
            If the use as explained in your letter,                  namely asp fuel
 for   the operation of,a pumping engine which lifts                  011, is a use
                                                              'b,;f
Hon. Geo. H. Sheppard - Page 2          (v-467)

comprehended by said Subsection of the statute,         then no tati is
.due upon the proauction'of    said gas.     We do not, however, accord
 such meaning to the phrase 'in the statute "used for lifting         oil".
This term is meant only to apply to gas Injected          Into thb earth
 for repressurlng   or lifting  the oil of the ground, and has no
 i?eference to It@ use as fuel to generate mechanical power, such
as puinplng op8rat'Fon.s for lifting    oil.   This Is the construction
 this, Department has heretofore     &corded to It.     (See OpItilon
0:&151;A, a copy of which you have.) ,Thls;we          think, was the
inanrfbst intention   of the Legislature,     end you are accordingly
 SO advised.,


                                SUMMARY
                                                                      ..
           Exclusion from the gas productFon,tax     of gas
    usea for lifting     oil as provided Fn Sub-section    c
    of Sbction 1 of Art,icle 7047b, has reference      only
    to gas Injected     Fnto the ground for the purpose of
    ijressure in-~lifting    the oil, and not to gas used
    as fuel In a pumping engine that lifts      011.
                                    Yours very truly~
                             ATTORNEY
                                    GENERALOF TEXAS

                             By   s/L. P. Loll&r
                                     L. P. Lollar
                                     Asslstafit

APPROVED
s/Fagan Dickson
FIRST ASSISTANT
ATTOR?IBYGENERAL
LPL/lh/wc