Dear Alaska Community Leader,
Today, BP Alaska is sharing some difficult news and I want you to hear directly from me. The company is announcing its decision to sell all of BP’s Alaska business interests to Hilcorp Alaska and exit the state.
Saying goodbye is never easy – and this one hits me hard as I reflect on the deep connection our company has been blessed to share with Alaska for 60 years. We have made history together. We have built community. We have faced challenges and solved problems. We have embraced many successes along the way.
Although it is hard to leave, I have confidence in Hilcorp and Prudhoe’s future. They are a known partner in Alaska and have a clear vision for realizing a long and bright future for the field. Prudhoe Bay is a special place – one of the most iconic oil fields in the world. Discovered in 1968 with production starting in 1977, Prudhoe has been the foundation of Alaska’s North Slope exploration and development for over 40 years and continues to underpin the energy renaissance we are seeing today.
We realize this is significant news for Alaska and we want to ensure our departure is safe, seamless and done in a way that honors our community and state relationships. BP will continue to operate Prudhoe until closing which we anticipate sometime in 2020. The deal is subject to state and federal regulatory approval.
As you can imagine, today’s news is very hard for our employees. They are Alaskans who have built careers, families and lives in this great state. I am especially proud of what they have accomplished these last few years. They have positioned Prudhoe for a successful future, stemming production decline (2015-2017) and improving our operating efficiency from 80 to 85% which added about 15,000 barrels per day to the pipeline.
Many of our 1,600 employees will have an opportunity to continue their great performance with the new owner while others may choose a different path. Safe operations and supporting our employees are my top priorities during this interim period.
Part of our journey to 40 more and business excellence has been achieved through our contractors – working safely beside us to realize efficiencies and strong results. As BP transitions the business, contracts continue. We will host a contractor forum in the near future to address questions and provide information relating to the transition.
I am proud of the way BP has shown up in support of our communities and non-profit organizations over the decades, being a part of improving human progression in our state. I know there will be questions in the coming days around BP’s social investment programs. My team stands ready to help our community partners create a solid glidepath. This includes donating the BP Energy Center with access to an endowment for operating costs to the community so that non-profits will continue to have free meeting space to support their missions.
In my early days as a reservoir engineer, I loved the rocks in Alaska. But my love for this state grew far beyond what lies under the frozen ground. I have been fortunate to serve in a role for BP that has allowed me to call Alaska home and to call so many Alaskans my friends. You can count on me to keep you posted as we move forward.
President BP Alaska