North Slope since 2013, when Hilcorp began operations there. Hilcorp’s investments since 2012 have resulted in substantial new oil production and revenues. New revenues total $5.6 billion since 2012 and an investment by Hilcorp of $2.6 billion. Another $750 million is planned this year in new drilling and development. The company is now a major employer, with 1,700 on staff and another 2,500 contractor employees. Hilcorp isn’t the only Alaska oil company that is an S corporation, either. It is a common form of corporate organization among explorers and small independent producers in the state. Hilcorp argues that by essentially targeting one company, SB 92 sends an adverse signal to small producers and explorers who want to invest and grow but would be apprehensive about new taxes if they are successful, as Hilcorp has been. The second oil tax bill, SB 112, reduces the per-barrel tax credit for oil producers from $8 per barrel to $5 per barrel. The bill does more than reduce the per-barrel credit, however. It also puts limits on where the credits can be used. Instead of being allowed to apply the credits against production income from all Alaska operations, companies would be allowed to apply them only to production income from certain leases. This sharply reduces the benefit of the credits. The per-barrel credit is a key part of the production tax changes made by the Legislature in 2013 that corrected major 14 ALASKA RESOURCE REVIEW SPRING 2025 CONTINUED FROM PAGE 12 Current legislation introduced as part of SB 112 would reduce the per-barrel tax credit for oil producers from $8 per barrel to $5 per barrel. The bill does more than reduce the per-barrel credit, however. It also puts limits on where the credits can be used.
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