BP’s 2003 capital budget up slightly from last year

Kay Cashman, PNA publisher

BP Exploration (Alaska) Inc. will spend $750 million in Alaska in 2003, up $25 million from what was budgeted for 2002 and up $110 million from what was actually spent in 2002.

Company spokesman Daren Beaudo told Petroleum News Alaska in mid-January that “spending in 2003 is flat or slightly above 2002 budget figures. (I) don't have any specific reasons for the change.”

Roughly $500 million will be spent “for production activities and the balance for transportation — most notably $200 million for construction of the Alaska Class tanker,” Beaudo said.

“Our capital investment focus continues to be on existing fields and adding production to offset decline. This is being done in existing North Slope fields through our existing infrastructure, along with our continued investment in viscous oil production. At the same time we need to stay on top of our cost structure so that we can continue to remain competitive and receive capital dollars,” he said.

The “biggest difference” between what BP budgeted in 2002, $725 million, and what was spent, $640 million, was due to the company deferring some of the $100 million ship’s expenditure, Beaudo said.