Oil giant BP Plc. (BP,BP.L) Monday said it plans to add $1 billion in new investment and two drilling rigs to its Alaska North Slope fields over the next five years due to changes in the state's oil tax policy. The change in tax policy was signed into law this month by Governor Sean Parnell.
BP Alaska Region President Janet Weiss said, "With this new tax law, the Alaska legislature and Governor Parnell have taken an important step toward improving Alaska's long-term economic future. Our announcement today should make abundantly clear that BP is committed to being a part of that future and to continuing to extend the life of North America's largest oil field."
These plans require an increase in drilling and well-work activity as well as the upgrading of existing facilities and the addition of up to 200 new jobs in the state.
Additionally, BP has successfully secured support from other working interest owners at Prudhoe Bay to begin evaluating an additional $3 billion worth of new development projects located in the west end of the Greater Prudhoe Bay Area. These projects could continue for nearly 10 years, further increasing the state's oil production and providing additional jobs.
BP Exploration (Alaska) Inc. will issue a request for proposals beginning this summer for the two additional rigs in Prudhoe Bay. The first drilling rig is expected to be in place by 2015 and the second in 2016. This will bring BP's rig fleet in Alaska to nine.
BP expects to increase well work as soon as the fourth quarter, which is anticipated to improve the performance of existing wells at the Prudhoe Bay and Milne Point fields.
The additional development opportunities being evaluated by working interest owners are in the west end of Prudhoe Bay. These include expansion and de-bottlenecking of existing Prudhoe Bay facilities, constructing a new drilling pad, and expansions of existing pads, including the drilling of more than 110 new wells.
The appraisal phase will take 2-3 years and will include engineering work and securing regulatory approvals for multiple development projects.
BP is also working with other companies and the state of Alaska to commercialize Alaska North Slope natural gas as part of a joint concept selection group focused on a South Central Alaska LNG project.
BP.L closed down nearly 1 percent on Monday at 469.00 pence.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.