Sign in Subscribe
Petroleum industry

BP's John Browne Visits Alaska Amid Proposed $26 Billion Takeover of Arco

Strategic Insights

— 1 min read

BP Amoco's chief executive John Browne embarked on a whirlwind tour of Alaska on Friday, meeting with employees, business leaders, and politicians to discuss the company's proposed $26 billion acquisition of Arco. Despite issuing assurances about BP's commitment to Alaska oil development, Browne had few specifics about the company's plans for the state. His meetings included sessions with potential Arco employees, lunch with Anchorage business leaders, and a private dinner with Governor Tony Knowles.

Key Takeaways:

  • Browne met with BP employees, Arco workers, and business leaders to discuss the takeover and its implications for Alaska's oil industry.
  • He issued broad assurances about BP's commitment to ongoing oil development in Alaska, but had few specifics about the company's plans.
  • Browne said BP doesn't believe its dominant ownership of the trans-Alaska pipeline would be an anti-competitive issue, but acknowledged that job cuts would be necessary.
  • Estimates suggest that 400 Alaska jobs will be cut as a result of the takeover, with technical and managerial positions being targeted.
  • Rep. Joe Green said Browne informed legislators that BP and Arco would have "very roughly" the same number of remaining employees.
  • Browne emphasized that BP doesn't want Alaska to change its tax structure for the oil industry, a departure from his comments in London two months ago.
  • The company has yet to identify which Alaska land holdings it would need to divest to comply with state regulations.
  • Browne reaffirmed Alaska's importance for crude oil production, stating that the state will continue to be a key player for both today and tomorrow.

Statistics:

  • $26 billion: The proposed takeover price of Arco by BP Amoco
  • 400: Estimated number of Alaska job cuts resulting from the takeover
  • 870,000: Current onshore acres under lease with Alaska, held jointly by BP and Arco
  • 500,000: Maximum number of state acres of non-producing onshore acres that a company can hold under state law

Sources:

  • Daily News Reporters Robert Kowalski and Ben Spiess
  • BP spokesperson Paul Laird
  • Rep. Joe Green
  • Rep. Eldon Mulder
  • Rep. Ethan Berkowitz
  • Gov. Tony Knowles
  • Wally Hickel
  • Bill Sheffield
  • Elmer Rasmuson
  • Betsy Lawer
  • Carl Marrs
  • Pete Leathard
  • John Browne (CEO, BP Amoco)

Read more