SCR 9: Relating to the state's interest in oil and gas company mergers and establishing a Joint Special Committee on Mergers as a joint committee of the legislature.

00SENATE CONCURRENT RESOLUTION NO. 9 01 Relating to the state's interest in oil and gas company mergers and establishing 02 a Joint Special Committee on Mergers as a joint committee of the legislature. 03 BE IT RESOLVED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 WHEREAS BP Amoco and Atlantic Richfield Co. (ARCO) have announced their 05 agreement for BP Amoco to merge with ARCO; and 06 WHEREAS BP Amoco is the single largest producer of oil and gas in the state, 07 owning approximately 36 percent of the oil located on the North Slope; and ARCO is the 08 second largest producer in the state, owning approximately 28 percent of the oil located on 09 the North Slope; and 10 WHEREAS the oil and gas industry generally, and BP Amoco and ARCO in 11 particular, through the payment of royalty, severance tax, property tax, and corporate income 12 tax, are responsible for a significant portion of total revenues received by the state and some 13 municipal governments of the state; provide significant employment opportunities in the state; 14 and alter the state's environment through their exploration, pipeline, and marine transportation

01 activities; and 02 WHEREAS the Alaska State Legislature finds that the merger of BP Amoco and 03 ARCO will result in a significant increase in BP Amoco's ownership of the total oil and gas 04 assets located on the North Slope of Alaska and elsewhere in the state and will eliminate BP 05 Amoco's most significant competitor with respect to exploration and development of oil and 06 gas in the state; and 07 WHEREAS the Alaska State Legislature finds the merger will have significant 08 consequences for the state in many areas, including state revenue, employment opportunities 09 in the state, environmental impacts, future exploration and development of as yet undiscovered 10 oil and gas fields and reservoirs, and the sale of natural gas from the North Slope; and 11 WHEREAS the Alaska State Legislature finds that, as a general matter, the 12 concentration of economic power is a matter of serious concern to the people of the state, and 13 that the merger will have significant and irreversible effects on the future course of oil and 14 gas development in the state; and 15 WHEREAS, given the importance of the merger, it is imperative that the state 16 administration and the Alaska State Legislature conduct a comprehensive, expedited review 17 of the effects of the merger on the state and its people; and 18 WHEREAS the Alaska State Legislature finds that the following effects, among 19 others, should be examined as part of this review: future oil and gas leasing; future state 20 revenues from oil and gas exploration and production; sale and transportation of natural gas 21 from the North Slope; future technological developments relating to North Slope exploration 22 and production; and future environmental compliance; and 23 WHEREAS the pre-merger approval process of the Federal Trade Commission will 24 likely be concluded during the interim between regular legislative sessions and decisions will 25 be made by the attorney general or the Federal Trade Commission about what remedies are 26 available and appropriate; and 27 WHEREAS, if the results of the analysis indicate that state or federal antitrust laws 28 are violated, decisions will have to be made and actions taken before January 2000; and 29 WHEREAS Governor Knowles has indicated strong support for a joint and cooperative 30 merger review process between the executive branch and the Alaska State Legislature; 31 BE IT RESOLVED by the Alaska State Legislature that a Joint Special Committee

01 on Mergers is established to study issues relating to the proposed merger of BP Amoco and 02 Atlantic Richfield Co., and to collect information, including the holding of hearings should 03 the committee consider hearings desirable with the power to compel attendance by subpoena 04 if necessary, to hire consultants and experts, to work with the governor, the governor's staff, 05 and outside consultants, and to take whatever other action may be appropriate to ensure that 06 the best interests of the state are protected; and be it 07 FURTHER RESOLVED that among other matters the Joint Special Committee on 08 Mergers shall consider are whether the best interests of the state require that a suit be brought 09 for the purpose of prohibiting the merger or of requiring divestiture of oil and gas assets in 10 Alaska, the types of conditions and commitments that may be required of BP Amoco in the 11 event a consent decree is negotiated either by the Federal Trade Commission or the attorney 12 general, and, in the event the merger does occur, what legislation should be adopted in the 13 Second Session of the Twenty-First Legislature to ameliorate any adverse effects on state 14 revenues or on the economic and physical environments of the state; the committee shall 15 report to the legislature within 15 days of the commencement of the Second Session on any 16 action taken; and be it 17 FURTHER RESOLVED that the President of the Senate and the Speaker of the 18 House shall jointly determine the number of senators and representatives to be members of 19 the committee, appoint the committee members, and jointly designate a member to chair the 20 committee; and be it 21 FURTHER RESOLVED that the Joint Special Committee on Mergers may meet 22 during and between sessions of the Twenty-First Alaska State Legislature, and is terminated 23 on the convening of the First Session of the Twenty-Second Alaska State Legislature.