China could be winner in Alaska oil war

Oil hit $100 a barrel last week, but scandal and corruption still stalk the industry

Doug Suttles, a senior executive at BP, had more than his fair share of bad news over Christmas. While most of the western world was eating turkey, the lawmakers in the area he runs for the British oil giant decided to throw their weight about.

The authorities on Suttles’ turf decided to press ahead with a big rise in tax on oil companies. On Boxing Day, they upheld a decision to withdraw exploration licences awarded to BP and other large oil producers. Then last week, BP agreed to cough up


As the world gets used to the idea of oil at $100 a barrel, every region with oil is getting a little more greedy. Suttles’ tale is becoming familiar for oil executives the world over. But Suttles does not run BP’s operations in outposts such as Kazakhstan or Venezuela. He is BP’s head of exploration in Alaska, the Arctic state of the good old US of A.

Under a cloud of bribery and corruption scandals, Alaska is hitting back against the oil industry. Even the Republicans who now run the state are in revolt at the favourable treatment the oil industry has enjoyed from Alaska over the years. For many of the 670,000 people who live there, resentment against the industry has been growing for years, but it reached new levels of intensity after BP’s oil spill at Prudhoe Bay in 2006.

Now both BP and Exxon Mobil are threatening to reduce their investment in the area. Such threats are standard practice in the oil industry. But with an oilman sitting in the White House this is not the type of issue the oil majors expect to encounter on American soil.

Telegraph