Late yesterday, the CEO of BP’s Alaska operation wrote an open letter to Alaskans outlining the company’s commitment to the state, even during this period of low oil prices.  The letter below responds to recent news reports.   -dh

Janet Weiss. Northern Gas Pipelines file photo by Dave Harbour

To Alaskans:

As you may have seen in the news recently, BP awarded a competitively bid contract for engineering, procurement and construction (EPC) services to Wood Group and its Alaska sub-contractor Arctic Slope Regional Corporation (ASRC) Energy Services, an Alaska Native Corporation.  This contract covers part of our capital spend—roughly half of our capital spend at Prudhoe for project work at our facilities.

Like many of you in this challenging economic environment (BP Alaska was negative $358 million in cash flow in 2016), we are working hard to simplify how work gets done and make it more efficient. Although our contract is confidential, what I can tell you is that by bringing all of our EPC activities under one umbrella company providing overarching management (rather than a series of different contractors), we will reduce duplication, greatly simplify project hand-offs and keep jobs in Alaska.

We are deeply committed to maintaining a safe and sustainable business in Alaska and for us that means supporting Alaska businesses and promoting Alaska hire among our contractors. In fact, we specify local hire requirements in our contracts and we require data on each prospective contractor’s Alaska hire during the bid process and Wood Group and ASRC Energy Services did propose a strong Alaska hire plan. I am proud to say that in 2016 BP supported about 6,000 Alaska contractor jobs and more than 16,000 jobs across the state. We also sponsor numerous programs such as APICC and ANSEP to help make sure there is a continuous pipeline of trained and qualified Alaskans to work in the industry.

Given the importance of this subject, I wanted to provide this information to you with the background and implications of this decision; we pursued a solution that kept jobs in Alaska while improving the sustainability of our business.  We are seeking to add years to the field life of Prudhoe Bay which results in more barrels down TAPs and Alaskan jobs for a longer duration.

Regards,

Janet Weiss

Here is yesterday’s report and our commentary on the western states meeting in Anchorage of pipeline transportation and utility regulatory commissioners.   Note that NARUC and its regional organizations include federal regulatory heads as well as commissioners from Canada and other nations.  Scroll down for today’s agenda highlights.

 In the news today!

Nine groups file motions surrounding LNG project
Multiple groups have officially taken legal action – both positive and negative – in an attempt to intervene in plans to create Alaska’s…

Raiding energy industry to solve budget crisis will create more problems
Alaska is in a budget crisis. The “gravest fiscal crisis in state history,” according to Gov. Bill Walker.

Tolerance is becoming intolerable
The state Legislature proved that, despite the ridiculous and unjustified censure of David Eastman…

La. politician appointed head of BSEE

The Trump administration has picked Scott Angelle, former vice chairman of Louisiana’s Public Service Commission, to lead the Interior Department’s Bureau of Safety and Environmental Enforcement. “Scott Angelle brings a wealth of experience to BSEE, having spent many years working for the safe and efficient energy production of both Louisiana’s and our country’s offshore resources,” Interior Secretary Ryan Zinke said.

Interior secretary’s schedule packed with oil, gas industry meetings

Interior Secretary Ryan Zinke met with more than 20 officials at oil and natural gas companies, including Chevron, ExxonMobil, and BP America, as well as trade groups including the American Petroleum Institute, in March and April, according to his personal schedules made public last week. The discussions often revolved around Obama-era energy policies and efforts to overhaul them.

The Washington Post (tiered subscription model) (5/19)

Oil industry works on automated drilling

The oil industry is making progress in developing automated drilling systems, but the effort faces challenges such as geological adaptability, sensor selection and the need for a way for machines to communicate with each other. A new report called Stage One gives onshore and offshore drillers technological guidelines and a framework for coordinating automation.

World Oil (5/2017)

WASHINGTON D.C. — President Donald Trump today proposed a $171 million Fiscal Year (FY) 2018 budget for the Bureau of Ocean Energy Management (BOEM) to safely and responsibly manage offshore energy and mineral resources. The Bureau’s budget helps put the Federal government on track to a balanced budget by 2027. Read more…

Here is yesterday’s report of the western states meeting in Anchorage of pipeline transportation and utility regulatory commissioners.  Below are a few of today’s agenda highlights.

General Session #2 CEO Panel-Chairman Robert M. Pickett, Chairman, Regulatory Commission of Alaska Jacob DeWitte, Co-Founder and Chief Executive Officer, OKLO Inc. Patricia Vincent-Collawn, Chairman, President and Chief Executive Officer, PNM Resources & Vice Chairman of the Board, Edison Electric Institute Kimberly Harris, President & Chief Executive Officer, Puget Sound Energy Gregory F. Chapados, Executive Vice President and Chief Operating Officer, GCI Oran Paul, President, Fairbanks Sewer & Water, Inc. Thomas Starrs, Vice President, Market Strategy and Policy, Sunpower

D1 Innovation: Bringing Utilities and Regulation into the Digital Age – Vice Chairman Travis Kavulla, Montana Public Service Commission Tom Forese, Chairman, Arizona Corporation Commission Ken Schisler, Vice President Regulatory and Government Affairs, EnerNOC Anda Ray, Senior Vice President, Energy, Environment, and External Relations, Electric Power Research Institute

D2 Do We Still Need State USF in Today’s World? If so, How Should It be Directed? – Jeffrey Ackermann, Chairman, Colorado Public Utilities Commission Michael Picker, President, California Public Utility Commission Chairman Sandy Jones, New Mexico Tina Pidgeon, Senior Vice President, Governmental Affairs and Senior Counsel

E1 Gas Storage and Pipeline Safety: Preparing for the Acts of God and Failures of Man. Is Gas a Viable Bridge From Here to Eternity?-Commissioner Stephen McAlpine, Regulatory Commission of Alaska Ron Edelstein, Director of Regulatory and Government Relations, Gas Technology Institute Matt Federle, Manager of Gas Storage Plant, Cook Inlet Natural Gas Storage Alaska Rebecca Massello, Security and Operations, AGA Chris Mele, Legislative Director, Energy, NARUC

E2 The Intersection of Energy, Environment and Infrastructure, and the Aftermath of the Clean Power Plan-Commissioner Norman Rokeberg Commissioner Tim Echols, Georgia Public Service Commission Commissioner Doug Little, Arizona Corporation Commission Robert S. Kenney, Vice President, CPUC Regulatory Relations, Pacific Gas and Electric Company

Climate Change: Glacial Recession, Arctic Ice Melt, Coastal Erosion, Changing Weather Patterns, What Can We Do? Busses to Portage Glacier and Alaska Wildlife Conservation Center (Box lunch provided.) Or Networking in Anchorage 5:45 p.m.-6:30 p.m. Shuttle – Hotel to Museum Reception & Dinner (Returns TBD)