63° F
Light Rain
Light Rain

BP Lauds Oil Tax Reform As August Referendum Looms

Published On: Feb 10 2014 07:16:21 PM AKST   Updated On: Feb 11 2014 10:48:03 AM AKST

BP's outlook on Alaska's new tax sturcutre


 British oil giant BP says oil tax reform in Alaska has made a difference in the scale and pace of the company's activities on the North Slope.

The announcement comes just six months before voters decide whether or not to repeal the new oil tax law known as SB 21 (known as Proposition 1 in the August ballot).

BP’s Alaska Regional President Janet Weiss says the company plans to invest 90 cents on every dollar that it makes back in Alaska, a 60 percent increase over what it invested under the old tax structure called ACES.

The company plans to add two new drilling rigs by 2016, requiring an investment of $1 billion.

Supporters of repealing SB 21 say oil companies including BP continue to make big profits while the state looks at billion-dollar deficits.

“BP's profits per barrel are higher in Alaska, are higher than they are anywhere else in the world. And they were higher than anywhere else in the world under ACES,” said referendum supporter Ray Metcalfe.

BP says repealing the new tax law would put its future investments in question. “If the referendum is voted in and the oil tax reform was pulled down, BP, along with the other companies, would need to go back (and) reassess the investments that we had already initiated,” said Weiss.

The referendum that would repeal SB 21 will come before voters on the primary ballot on August 19.