Oil patch dividends

Posted: Monday, December 11, 2000

The following editorial appeared in Friday's Fairbanks Daily News-Miner:

The donation of $2.5 million from the state's two biggest oil producers to the University of Alaska offers another example of the benefits flowing from industry's continued investment in Alaska.

A decade after production topped off at Prudhoe Bay, the nation's largest oil field, the outlook for continued oil development in the arctic remains bright. Crude is still streaming into the trans-Alaska pipeline from enhancement projects, which have added years to the projected life of Prudhoe and other existing oil fields, as well as from new producing areas of the North Slope, Alpine being the most notable.

University President Mark Hamilton is on the right track in suggesting the $2.5 million in recent gifts from BP and Phillips ought to be plowed back into training Alaskans for jobs opening in the state's most lucrative industry.

At least as important as the size of Wednesday's UA contributions were the names on the checks. When the Charter for Development agreement was reached with the Knowles administration last fall, BP, through its takeover of Atlantic Richfield, was poised to become the majority owner of every producing oil field on the North Slope.

The charter's nonbinding provision for charitable donations was one of the chief concessions cited as Gov. Tony Knowles endorsed the consolidation of Alaska's oil industry in the hands of a single dominant owner-producer.

Federal regulators put the kabosh on that budding monopoly, insisting on the divestiture of Arco's Alaska assets. Thus the university this week gratefully received checks from two sources: collecting roughly $1.5 million from BP and close to $1.1 million from Phillips.

The charter called for charitable contributions reflecting a small cut of the producer's Alaska profits. The pair of checks generously presented to Hamilton serve as a testament to the lasting benefits of preserving healthy competition in Alaska's

oil patch.

On the latter score, Alaskans owe thanks to the Federal Trade Commission.

Distributed by The Associated Press

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