Though Alaska’s oil patch is one of the world’s costliest for doing business, the state is also among the most profitable oil regions, according to data released Feb. 1 by the Alaska Legislature’s Legislative Budget & Audit Committee.
The information is a sample of the data contained in “Wood Mackenzie Global Oil and Gas — Risk and Rewards 2004,” a study that the committee is analyzing in hopes of better understanding how Alaska should value its oil and gas resources.
In the study, Alaska ranked 52 out of 58 in total costs, and 14 or 15 out of 49 or 53 regions (depending on whether oil prices are low, moderate or high) in rate of return, or overall profitability per barrel as compared to its competitors for investment.
In government take, or taxes and royalties, throughout the life of its oil fields, Alaska ranked 33 out of 54 regions at $16 per barrel; 24 out of 54 regions at $22 per barrel and 19 out of 55 regions at $35 per barrel.
The 2004 study focuses on the period 1994 to 2003, measuring 66 areas in 58 countries. Alaska is measured and ranked more than 150 ways in a “massive” body of confidential data that the lawmakers must interpret, said LB&A Committee Chairman Sen. Gene Therriault, R-North Pole.
“This may be one glimpse under the cover that the general public gets,” Therriault told reporters at a news conference in Juneau.
He said the committee has hired former chief petroleum economist Chuck Logsdon to evaluate the 2004 study and help the lawmakers understand it.
An earlier version was published in 2002 based on data from 1991 to 2000. It ranked Alaska dead last in the total cost of doing business and 36 out of 61 in terms of taxes and royalties, which put the state at 55 for overall profitability per barrel of oil.