BP has written off its stake in the Point Thomson oil and gas field, and some state officials see the move as progress in Alaska's fight for control of the vast reserve.
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The field, just west of the Arctic National Wildlife Refuge, is thought to hold as many as 9 trillion cubic feet of natural gas as well as 300 million barrels of oil.
BP has told the federal Securities and Exchange Commission that its investment in Point Thomson no longer has any value. In a note attached to its annual report filed with the SEC this spring, BP said it was writing off the $27 million asset.
In previous years, the company had said it was continuing to try to find ways to develop the field.
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BP is just one of the lease owners in the former Point Thomson Unit, a collection of parcels held by several firms and jointly managed by Exxon Mobil Corp.
Former Gov. Frank Murkowski's Department of Natural Resources canceled the leases, saying that the companies had failed to meet their obligations to develop them.
Gov. Sarah Palin's resources commissioner, Tom Irwin, reaffirmed the cancellation when her administration took office this year. BP, Exxon and other companies have filed legal and civil actions challenging the cancellations.
Canceling the leases could give the state the ability to make the gas available to a developer of a North Slope natural gas pipeline. That would strengthen the state's negotiating hand if the big three oil producers - BP, Exxon Mobil and ConocoPhillips - remain adamant that they won't build a natural gas pipeline and won't sell their leased gas to anyone else.
"It does bring tremendous leverage to the state," said Jim Whitaker, mayor of the Fairbanks North Star Borough and chairman of the Alaska Gasline Port Authority, which wants to build its own gas pipeline through Alaska to a liquefied natural gas export terminal in Valdez.
"In my opinion it does assist the governor in her effort to bring a gas line to fruition," he said.
BP spokesman Steve Rinehart disputed the significance of the SEC filing.
"It's an accounting requirement more than anything," he said. The SEC filing does not reflect a change in BP's position on Point Thomson, he said.
"We are part of the appeal of the state's ruling. We have disagreed with the state's ruling and we have appealed it in court."
Nan Thompson, petroleum manager for the Department of Natural Resources, said the BP filing looked more significant than the company was willing to admit.
"It seems like an acknowledgment that is no longer an asset of value if they're writing it off," she said.
The state has already won some preliminary rulings, said Meghan Stapleton, Palin's press secretary.
In late May a judge rejected the oil companies' attempts to delay, winning praise from Stapleton.
"This decision represents another step forward in the state's effort to have its valuable oil and gas resources responsibly developed," she said.
A decision may come by the end of summer, Stapleton said.
Exxon is maintaining on its books as an asset the $28 million it spent drilling wells at Point Thomson from 1977 to 1980, but executives declined to discuss the company's position.
Exxon Mobil spokeswoman Susan Reeves in Houston said she spent a week trying unsuccessfully to find someone in the company willing to comment on why it's keeping the field as an asset, while the state says its rights are forfeit.
Rights to the Point Thomson field are likely worth billions, say state officials. At current oil prices, the 300 million barrels of oil there alone are worth many billions.
Pat Forgey can be reached at email@example.com or 523-2250.
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