JUNEAU, Alaska (AP) — ConocoPhillips Alaska on Wednesday reported earning $551 million in the state during the second quarter. That’s down $69 million from the first quarter, and was attributed to lower oil prices and sales volumes.
The company, one of the three major oil producers in the state, said tax and royalty obligations to Alaska for the latest quarter totaled about $983 million.
The “very high” government take on the North Slope negatively affects the investment climate, ConocoPhillips Alaska vice president of finance Bob Heinrich said in a statement. The company has been among those urging lawmakers to lower production taxes.
ConocoPhillips said its capital budget for the Lower 48 increased from $1.6 billion in 2010 to $4.8 billion in 2012, while Alaska’s budget remained around $900 million, and that full amount wasn’t spent last year.
But state Sen. Bill Wielechowski, D-Anchorage, said the company’s financial report shows the state’s tax structure is working and also “confirms what we’ve been saying all along — Alaska is one of the most profitable places in the world for the oil and gas industry.” He said it also calls into question the need for “major tax rollbacks.”
He noted the company had net earnings of $104 million in the Lower 48 during the second quarter.
ConocoPhillips Alaska spokeswoman Natalie Lowman called Alaska and the Lower 48 an apples-to-oranges comparison. She said the company is focused on oil in Alaska, and has a strong interest in natural gas in the Lower 48. And she said the price for gas, based on a barrel of oil equivalent, is much lower than it is for oil.
