Hilcorp has closed on the biggest portion of its $5.6 billion deal to buy BP’s Alaska assets, taking ownership of facilities across the oilfields of the North Slope and considerably expanding its presence in the state oil and gas industry.
The company took ownership of BP’s interests in the Prudhoe Bay, Milne Point and Point Thomson fields and operatorship at Prudhoe Bay as of Wednesday. Hilcorp will triple its Alaska workforce to more than 1,450 people, according to a company news release.
“We look forward to continuing to drive economic growth, create Alaskan jobs and contribute to local economies for decades to come,” Greg Lalicker, chief executive officer of Hilcorp Energy Co., said in a prepared statement. “Hilcorp is committed to safely and responsibly developing Alaska’s natural resources.”
The sale marks a new era for Prudhoe Bay, said William Lin, BP executive vice president for regions, cities and solutions. BP is leaving after operating in Alaska for decades.
“It is a world-class field, and Hilcorp is well-positioned to take it into the future and maximize value for the state of Alaska. We wish them the very best for this next phase of Prudhoe Bay’s long life,” he said in a prepared statement.
Janet Weiss, regional president of BP Alaska, said BP values its place in Alaska history. She thanked Gov. Mike Dunleavy “and his team for positioning Prudhoe Bay for many more years of competitive production,” according to a prepared statement.
It’s not a complete exit for BP, which retained secondary liability at 50 known contaminated sites and for dismantlement, removal, and restoration of facilities, according to Corri Feige, state of Alaska Commissioner for the Department of Natural Resources.
Earlier this week, the state announced that the Department of Natural Resources had approved the transfer of hundreds of oil and gas leases and surface permits on the North Slope after a 10-month review of Hilcorp’s finances that involved experts at the National Economic Research Associates and the international law firm Morrison & Foerster.
Hilcorp is a privately owned Texas based company known for increasing production in aging oil fields and has been acquiring oil and gas properties in Alaska since 2014.
U.S. Sen. Lisa Murkowski, R-Alaska, put out a statement recognizing both Hilcorp and BP and the historic nature of the sale.
“I’m very pleased to see this transaction move forward and appreciate Hilcorp’s commitment to Alaska,” said Murkowski, who is head of the Senate Energy and Natural Resources Committee.
“This announcement is particularly welcome news for our state as we work to rebuild our economy,” she said in the statement. “Hilcorp has ensured a stable natural gas supply in Cook Inlet and secured a 90-percent local hire rate in recent years. BP has been a steady and reliable partner in Alaska, and I congratulate both companies on the successful closing of this portion of the sale.”
Regulatory review of Hilcorp’s acquisition of BP’s share of the trans-Alaska oil pipeline is pending.
Contact staff writer Amanda Bohman at 459-7545. Follow her on Twitter: @FDNMborough.