BP in Alaska
Alaska remains one of BP’s leading resource basins. After more than 36 years of production, the North Slope still has a large amount of the discovered oil and gas remaining. BP focuses its strategy and investment in Alaska on the known resources; on renewing its North Slope infrastructure; on ensuring safe and sustainable operations; and on commercializing Alaska natural gas.
BP operates more fields that produce more oil than any other energy company in the state. Our 13 oilfields on the North Slope (including Prudhoe Bay, Endicott, Northstar and Milne Point), account for about two thirds of Alaska oil production. We also hold the greatest ownership share in the 800-mile long Trans Alaska Pipeline System (TAPS).
We are also one of Alaska’s largest private sector investors, taxpayers and employers. In 2012, BP Alaska paid $2.8 billion in taxes and royalties and other government payments to the State of Alaska. Furthermore, BP is one of the top 10 employers in Alaska, with 2,300 employees and more than 6,000 contractor jobs.
The technology play
Alaska has long been a major US oil producing region. Although North Slope production is declining BP continues to invest in Alaska oil and gas resources. (Today the Trans-Alaska Pipeline carries less than one-third of what it did at its peak of 2 million barrels a day.) BP is actively pursuing new ways to develop remaining, more challenging North Slope resources including viscous oil, light oil from smaller, more remote fields, and natural gas.
Typically less than half the oil from a reservoir is recovered, but — using new technology — BP has demonstrated that it can improve on that recovery rate. BP is exploring Alaska’s resource opportunities with technologies such as 3-D seismic imaging, innovative drilling techniques, carbon dioxide for enhanced oil recovery, low-salinity water flooding, and Bright Water™ polymer technology.
Renewal of North Slope infrastructure
Safe and reliable operations continue to be the focus of our Alaska business. BP has invested $850 million annually for eight years to enhance safety and operational integrity in Alaska. BP has significantly increased spending on corrosion monitoring and prevention, such as in-line smart-pig inspections. Each year, BP conducts more than 110,000 pipeline inspections for corrosion under pipeline insulation and 160,000 total pipeline inspections (X-ray, ultrasound and visual) on the North Slope.
Alaska gas pipeline
North Slope natural gas is one of the largest undeveloped resources in BP's global portfolio. The US Department of Energy estimates the discovered, technically recoverable natural gas on the North Slope to be about 35 trillion cubic feet.
At Prudhoe Bay, up to 8 billion cubic feet of natural gas are produced daily and injected back into the ground to maintain reservoir pressure and produce more oil. This injection has improved oil recovery and extended the life of the field beyond initial estimates. In addition, some components of the produced natural gas are used to make miscible injectant, which is deployed/utilized for enhanced oil recovery.
Other than the natural gas liquids that are shipped down the Trans Alaska Pipeline, there is no means to transport North Slope gas to markets. BP, ExxonMobil, Conoco- Phillips, and TransCanada are working together with the State of Alaska to determine the feasibility of commercializing Alaska gas through LNG export to global markets. The companies agreed upon a project concept, and in 2014 signed a Heads of Agreement to pursue the potential project. If the project is commercially competitive, the timing is estimated to be after 2023.