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BP Alaska: $2.45 billion in 2007 Company upped earnings despite production declines, tax increases; paid $2.133 billion in taxes, including $1 billion plus to state Eric Lidji Petroleum News
BP Exploration (Alaska) Inc. made $2.45 billion in 2007, an 11.7 percent increase over 2006 earnings, despite production declines on the North Slope and tax increases from the state government.
The Alaska subsidiary of the London-based oil giant brought in $6.59 billion in revenue and paid $2.133 billion in taxes last year, according to annual financial statements posted on the company’s Web site on March 10.
Of the 2007 tax burden, nearly half came from production taxes.
The company paid $1.052 billion in production taxes in Alaska 2007, up from $665 million paid in 2006, which in turn rose from $352 million paid in 2005.
Altogether, the production tax burden carried by BP in Alaska nearly tripled between 2005 and 2007, while its total tax burden from Alaskan operations jumped 43 percent during the same time period.
During a recent speech before the Anchorage Chamber of Commerce, BP Alaska President Doug Suttles said, “Today, by our calculation, Prudhoe Bay has the highest production tax now in the world, on an incremental basis.”
BP production down at most fields, up at Prudhoe BP Alaska produced 209,000 barrels of oil equivalent a day in 2007, a 7 percent decrease from 2006 production figures. The company attributed the drop to “normal decline in the large mature fields, partially offset by lower downtime.”
The declines ranged in size from field to field.
At BP-operated fields Northstar and Milne Point, company oil production dropped a combined 13,000 bpd.
The 98.6 percent working interest in the Northstar field yielded 28,000 bpd in 2007, down from 38,000 bpd in 2006, while the 99.4 percent working interest in the Milne Point field declined to 28,000 bpd in 2007, down from 31,000 bpd in 2006.
BP temporarily shut down Northstar production facilities from Feb. 16 to March 6 last year, but said it offset that lost production by the early restart of the Milne Point K-pad.
At the ConocoPhillips-operated Kuparuk field, BP’s 39.2 percent working interest in the field yielded production averaging 52,000 bpd in 2007, down from 57,000 bpd in 2006.
However, production at the BP-operated Prudhoe Bay field increased last year, as the company’s 26.4 percent interest in the field produced 74,000 bpd, up from 71,000 bpd in 2006.
BP production at various other fields across the slope held even at 27,000 bpd in 2007.
BP natural gas production in Alaska in 2007 averaged 55 million cubic feet per day, down from 67 million cubic feet per day in 2006.
Rising oil prices buoyed profits companywide BP posted an average Alaska North Slope crude oil price per barrel at $71.68 for the year. The daily closing price of ANS crude oil delivered to the West Coast has fluctuated between $85.49 and $110.18 per barrel so far this year through March 13.
In companywide profits last year, BP p.l.c made $20.845 billion.
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