Contact the Governor
Frank H. Murkowski
Juneau Office
P.O. Box 110001
Juneau, AK 99811
907-465-3500 phone
907-465-3532 fax
State info 907-465-2111
Anchorage Office
550 West 7th Avenue, Suite 1700
Anchorage, AK 99501
907-269-7450 phone
907-269-7461 fax
State info 907-269-5111
Kenai Office
11312 Kenai Spur Hwy, Suite 2
Kenai, AK 99611
907-283-2918 phone
907-283-3037 fax
Mat-Su Office
877 Commercial Drive
Wasilla, AK 99654
907-352-2585 phone
907-352-2526 fax
Fairbanks Office
675 7th Avenue, Suite H5
Fairbanks, AK 99701-4596
907-451-2920 phone
907-451-2858 fax
Washington DC Office
444 North Capitol NW, Suite 336
Washington, DC 20001-1512
202-624-5858 phone
202-624-5857 fax
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Volume 3February 28th, 2006
Some Basics on the Big Three Oil Companies in Alaska
Most Alaskans know that a lion's share of the state's general fund revenue that pays for state services comes from
development of Alaska's oil and gas. But how much? And why?
At statehood, the United States Congress recognized that Alaska did not have the population base to support, through
individual taxation, enough revenue to provide basic state services, such as roads, public safety and education. As
a result, Alaska was granted rights to the oil, gas and other minerals that exist "subsurface," or below the surface,
on state lands. As Alaskans, we own these resources in common. In Fiscal Year 2005, 89 percent of the state's revenue
was from oil taxes and royalties.
Lands were selected under the statehood compact that ended up being the source of immense oil and natural gas reserves
both on the North Slope and also in the Cook Inlet. Those lands were leased to the oil companies giving them the right
to explore for oil and to develop any discovered resources. The state received in return bonuses and payments for the
leases along with a royalty interest in any oil or gas production. The companies that obtained these rights wound up
with the right to produce and commercialize some of the largest accumulations of oil and gas ever found in North America.
Alaska benefits by receiving royalties, corporate income tax, property tax and production tax from oil companies. Governor
Murkowski's proposed legislation aims to modernize the production tax. Hearings on the proposal are receiving much attention
in the Legislature, as this tax, and its impact on the state's future revenues is significant. All together Alaska has
collected nearly $58 billion in oil and gas revenues since we became a state.1
Yesterday and today, hearings on the oil tax legislation continued in both the House and Senate Resources Committees.
Testifying on the bill were representatives from three big North Slope producers, BP, ConocoPhillips and ExxonMobil.
Tomorrow, representatives from smaller companies will testify. Here is a glance at some additional facts about the oil
industry in Alaska:
Percent of State General Fund Revenue from Oil
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Unrestricted Oil Revenue
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Total Unrestricted Revenue
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% Oil
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FY 2005
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$2849.5 million
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$3197.7 million
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89%
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Share of Alaska North Slope Oil Production (Excluding Royalty Oil)
- BP -- 33.6%
- ConocoPhillips -- 40.9%
- ExxonMobil -- 20.2%
1 http://www.tax.state.ak.us/sourcesbook/PetroleumRevenueHistory.pdf
Trans Alaska Pipeline System Ownership
- BP -- 46.9%
- ConocoPhillips -- 28.9%
- ExxonMobil -- 20.3%
If you've missed the past two volumes of PPT Insider Edition, check out:
PPT Insider Volume 1 - Historic Oil Tax Legislation Proposed
PPT Insider Volume 2 - Oil Tax Bill Long Overdue.
For more information about the Governor's oil tax legislation, including questions and answers, charts and graphs and past issues of this PPT Insider's report, visit
http://www.gov.state.ak.us/oiltax/
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