State Must Closely Watch Inlet Energy Players, Says Micciche

Shaylon Cochran

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     As BP’s trial gets underway to determine its responsibility in the Deepwater Horizon oil spill, there are questions here about the ability of oil companies to not only operate safely, but to be able to clean up after themselves in the event of a spill.

     The trial that will decide if BP is solely responsible for a 2010 oil spill in the Gulf of Mexico began this week, raising concerns about the ability of operators here in Cook Inlet to respond to a spill both with equipment and financial resources. BP faces fines and penalties totaling $16 billion.

     For some perspective, in its 2012 annual report, Buccaneer Energy, which is planning on drilling exploratory oil and gas wells this year both on and off shore in Cook Inlet, listed its total assets at $68.5 million, though it did receive a $100 million line of credit earlier this year from a private asset management firm.

     Another Cook Inlet operator, Apache, noted $60.7 million in assets at the end of 2012. Asked during a teleconference in Juneau if there are concerns about the fitness of companies to do business here,  State Senator Peter Micciche said those companies need to meet a specific level of qualification.

     “I think it’s key that they have a record of success and the pockets necessary, God-forbid there is an incident,” he said.

     Micciche has had a lengthy career with ConocoPhilips, a long time oil and gas player in Alaska. He said even though many companies have found success here, that’s no guarantee that they’re prepared for future events, citing Shell as an example.

     “They’re a great company, they did a great job, they had a mishap and I do believe in their program but things do happen and we do need to make sure that in the rare occasion there are, hopefully, events that stay manageable and small, that we have the right people that can respond.”

     He says there are a couple ways to set a different accountability standard for energy companies.

     “One is that we make sure the Alaska Department of Environmental Conservation’s ability to respond remains adequately funded and that we make sure that we as stakeholders remain involved in the C-Planning, the response planning of these companies, so that we feel they have the ability to respond as well,” he said.

     C-plans, or contingency plans are submitted by companies and lay out exactly what they would do in the event of a spill or other emergency. Buccaneer’s plans to drill in the Cosmopolitan Unit this winter in Lower Cook Inlet are still on hold as it amends its C-plan.

     “Ultimately, what it comes down to is you want to make sure your incentives also have a clause that requires that companies have the ability to perform and that they have a record of performing. We don’t want to draw just anyone. We want to draw the best companies that we can trust to take care of our natural resources and the reasons most Alaskans live here, and it’s our beautiful natural resources.”

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