BP Amoco will pay $25.3 million to the state to settle a dispute over how much oil taxes the company owes Alaska.
The settlement, announced Thursday, covers tax claims and interest on BP's oil production on the North Slope from 1996 and 1997, said Dan Dickinson, director of the state's Oil and Gas Audit Division.
The details of the dispute and the agreement are confidential.
The money, as with all money arising from disputes between the state and oil companies, will be routed into the Constitutional Budget Reserve -- a state savings account.
Dickinson said the settlement came after months of negotiations with BP. The state collects production taxes every two years. It also collects money generated from income and property taxes and royalties.
This dispute only involved production taxes.
``The state gets four bites of the apple,'' Dickinson said. ``This was just one bite.''
The amount of money in the reserve account was about $2.9 billion today, Dickinson said. That money has been used for the last several years to cover the state's budget deficit -- the difference between state spending and revenues.
That savings account is expected to run dry sometime in 2004, though that estimate has been pushed back a bit by this year's oil prices, which have been higher than expected so far.
This spring, BP paid $416 million into the reserve. That settlement stemmed from tax disputes covering several years.
Dickinson said the disputes over taxes have narrowed in scope and taken less time to resolve over the years. As a result, the monetary terms have become smaller.
``The range of disputes have settled,'' he said. ``(Also) If we have a difference of opinion on something, we try to get on it earlier.''