The City of Valdez is taking a fight to have Hilcorp reveal its finances to state Superior Court in Anchorage.
The city is appealing a decision from the Regulatory Commission of Alaska, the state agency tasked with reviewing a critical piece of BP’s proposed $5.6 billion sale to Hilcorp.
Valdez filed a notice of appeal in court on Monday, first reported by The Anchorage Daily News. It presents another wrinkle in one of the state’s largest oil industry deals. The sale has yet to close.
Valdez’s appeal stems from an order by the RCA last month. The agency approved requests from BP and Hilcorp to keep their financial statements confidential during the agency’s review process.
The oil and gas companies argued the public release of the finances would damage their businesses and give their competitors an unfair advantage.
In public comments, however, some Alaskans demanded financial transparency from privately-owned Hilcorp, saying they wanted assurance that the company has the resources to operate the assets it wants to buy, and to respond to any costly oil spills.
The RCA ultimately decided that the companies’ and their affiliates’ financial statements submitted to the agency were “confidential as a matter of law.”
In its appeal, Valdez is arguing that the RCA’s interpretation of the state’s public records law is wrong. It says the agency’s decision violates fundamental rights under the state and U.S. constitutions, “thereby impeding transparency and the right to question, investigate and monitor the discharge of RCA’s duties,” according to the court documents filed by the Anchorage firm Brena, Bell & Walker, attorneys for the City of Valdez.
The RCA declined to comment on the appeal. It said it doesn’t comment on pending litigation.
The five-member RCA is charged with approving the portion of the BP-Hilcorp deal involving the Milne Point and Point Thompson pipelines, and the trans-Alaska pipeline, which ends in Valdez.
Earlier this month, the RCA asked Hilcorp to disclose whether and how the historic drop in oil prices will affect its ability to finance the deal. The company must respond by May 4.
The Wall Street Journal reported last week that banks had become uncomfortable providing a loan to Hilcorp as oil prices collapse. Alaska Natural Resources Commissioner Corri Feige recently told S&P Global Platts that the BP-Hilcorp deal is still on, but she expected it to close later than the companies wanted.