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Meyers asks for fiscal, regulatory stability Phillips Alaska Inc. will drill 10 exploration wells this winter. Kristen Nelson
Those wells, the company’s president, Kevin Meyers said Jan. 25, will look at what the company has discovered in the National Petroleum Reserve-Alaska, “perhaps adding more to that portfolio, gathering the data we need in order to make a decision about commerciality” so that the company can make that decision and perhaps have a development project to sanction before the year is out.
But, Meyers told the Alaska Support Industry Alliance’s Meet Alaska conference, “as we move farther west — and we are moving away from infrastructure — these wells become more and more challenging.
“It never gets easier,” he said: Economics, lack of infrastructure and a very short drilling season “all contribute to the challenges.” Cooperation needed Meyers said that if Phillips Alaska is going to be successful in NPR-A and have economic discoveries “we need the cooperation of all the stakeholders.” A lot of people, he said, are involved in land issues out there.
Phillips also needs “a continued, stable fiscal environment in the state” and “an efficient regulatory and permitting process,” Meyers said: “We need to keep that partnership we’ve had with the state of Alaska and, of course, we need help from our contractors to remain competitive.”
Meyers said he knew the Meet Alaska audience didn’t tend to forget, “but we need to always remember, we’re all in the oil industry in the state of Alaska. Every person that lives in Alaska’s in the oil industry, when you look at where their revenues come from and where a lot of the jobs come from.” Threat of the fiscal gap And what about the future? “I’m pretty optimistic,” Meyers said.
“On the other hand, I’ve got to be realistic. And I look out here and I see some things that can be very, very challenging to our industry and they’re problems that must be addressed.”
The biggest issue is the fiscal gap, Meyers said, “with this threat of increased taxes on the industry. Those are taxes that we cannot afford. To maintain production in Alaska we’ve got to keep this a competitive place to explore and develop.”
The state also needs more industry players, he said, companies like Anadarko and Alberta Energy.
“More E&P companies means more business for Alaska-based companies, more jobs, more revenues…” You may wonder why I’m trumpeting the competition, Meyers said: “It means more partners for us to help share the risk.”
Phillips hopes those companies will join it in investing in Alaska’s future, he said. But the state needs a stable fiscal environment to give those companies the confidence to make billion-dollar investments in the state.
The state, he said, needs to “encourage new development, not discourage it. The state must foster a pro-investment climate, stable fiscal environment and efficient permitting for future exploration and development.”
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