ANCHORAGE (KTUU) – BP Alaska announced Tuesday morning that it is selling its entire Alaska operation to Hilcorp Alaska.
The sale will include BP's entire upstream and midstream business in the state, including BP Exploration (Alaska) Inc., which owns all of BP's Alaska oil and gas flow and BP Pipelines (Alaska) Inc. Transalaskan Pipeline Share (TAPS).
Under the terms of the agreement, Hilcorp will pay BP a total of $ 5.6 billion, which consists of $ 4 billion in the short term, and $ 1
The transaction is expected to be completed in 2020.
The deal is a significant part of BP's plan to allocate $ 10 billion in assets in 2019 and 2020.
Approximately 1600 employees are currently affiliated with the Alaska business BP and BP say it is committed to providing clarity on its future as soon as possible as part of the transition process with Hilcorp.
The president of the Alaska Oil and Gas Association, a trade association called the news "historic and bitter."
"Alaska is losing a giant – a" big "company; still welcomes Hilcorp's expanding presence, "said Kara Moriarty, president and CEO of AOGA," For more than 40 years, BP has been pivotal to Alaska's economy and community, leasing thousands of Alaskans, generating millions of barrels of production and generously donating to charities organizations across Alaska.
Moriarty said there was great uncertainty about what the decision meant.
"Today we do not know the full details or consequences of this news, so we are very much concerned with the uncertainty that is likely to cause in the short term for many Alaska employees and contractors. I have confidence in both companies and their decision making as we go through this transition, "she said.
U.S. Senator Lisa Murkovski, Alaska, issued the following statement.
" Thank you BP for the long-standing his partnership for the production of resources in our country and the many significant and lasting philanthropic contributions he has made to our communities, "Murkovski said." I look forward to learning more details and am encouraged that an enterprising company like Hilcorp sees so many opportunities in Alya and wants to make such a significant investment in one of the most productive and under-explored pools in the world. Hilcorp has strong experience in hiring Alaskans, and I hope they continue and strengthen our record for responsible production on the North Slope. " Murkovsky is a senior senator in Alaska and chairman of the Senate Energy and Natural Resources Committee.
BP began work in Alaska in 1959, drilling the confirmed ion well for the Prudhoe Bay oil field in 1968 and in the middle. in the 1970s The 20th century helped to build the Trans Alaska 800mm pipeline. BP began producing oil from Prudhoe Bay in 1977. The giant oil field – the most productive in US history – has produced over 13 billion barrels of oil so far and is thought to have the potential to produce more than one billion other barrels.
To read the full message, click here.
"Our exit from Alaska in no way diminishes BP's commitment to America," says Bob Dudley, CEO of the BP Group, "We remain very bullish on the US energy sector. In the last three years alone, we have invested more than $ 20 billion in the United States and will continue to look for additional investment opportunities here. "
Chilcocorp is one of the largest, privately owned, independent exploration and production of oil and natural gas. companies in the United States, according to the Anchorage Chamber of Commerce. They are based in Houston, Texas.
A previous version of this article stated that Hilcocorp Alaska is based in Anchorage. Hilcorp Alaska is a subsidiary of Hilcorp Energy, based in Houston, Texas.
It's a developing story.
Copyright 2019 KTUU. All rights reserved.