West Virginia State Tax Commissioner Mark Matkovich and Ohio County Assessor Kathie Hoffman were also named as defendants in the suit.
Statoil has a non-operating interest in Ohio County in which it receives a portion of the natural gas produced by a well’s third-party owner, according to a complaint filed in Ohio Circuit Court.
Statoil claims the West Virginia State Tax Department only allows the operator for the wells to file property tax returns with it and values all economic interests in a particular well based on the operator’s returns.
For tax year 2015, Statoil provided revenue data to the third party operator of the Ohio County wells in which it had a “take-in-kind” interest and the tax department valued Statoil’s “take-in-kind” interest in the wells on the returns filed by the operators of the wells, according to the suit.
Statoil claims on Feb. 1, it filed a protest of the 2015 property taxes as it uncovered evidence that it had erroneously submitted data to the third-party operator of the wells and it sought relief under the principle of exoneration, which it eventually presented to the Ohio County Commission.
The plaintiff presented clear and convincing evidence that it deserved an application of the principle of exoneration and was entitled to tax relief in the amount of $2,838,725.04, according to the suit.
Statoil claims it timely petitioned the court for appeal of the county commission’s decision.
The Ohio County Commission has abused its discretion by denying the exoneration for Statoil, according to the suit.
Statoil is seeking for the court to find that the commission erroneously denied the application for exoneration for tax errors in the 2015 tax year; an order that the actual revenue and tax amounts set forth in the record by Statoil be accepted by the tax department and deemed accepted under West Virginia Code; and an order for such other relief as the court deems appropriate. It is being represented by Craig A. Griffith and John J. Meadows of Steptoe & Johnson PLLC.
The case is assigned to Circuit Judge David J. Sims.
Ohio Circuit Court case number: 16-C-246