Oil & Gas
Alaska’s Giving Pipeline
Philanthropy in the oil and gas industry
By Isaac Stone Simonelli

ew large foundations support “the general good” or social service projects in Alaska, so the Last Frontier has a pretty thin philanthropic layer, according to United Way of Anchorage Vice President Cassandra Stalzer. However, the oil and gas industry has a history of stepping in and filling the gaps in Alaska communities by providing money and volunteers for myriad charitable efforts in the state.

Because Alaska is a relatively young state with a small population, it relies on the philanthropy of industry more heavily than other states, especially the oil and gas industry, Stalzer says.

The oil and gas industry is a pillar of economic power in Alaska, providing jobs, tax revenue, and charity dollars in the state, according to Alaska Oil and Gas Association President and CEO Kara Moriarty.

“Alaska’s oil and gas companies are proud to contribute to Alaska’s economy and quality of life.

“When our industry thrives, our state benefits in many ways, from funding essential services to employing Alaskans to contributing to the health of the Permanent Fund,” Moriarty says. “As the data shows, Alaska’s oil and gas industry remains the single most important economic engine in the state, and we are proud of the work we do to benefit all Alaskans.”

“We absolutely know the meaning of caring about our neighbors and the value of people coming together to solve problems. So we are excited to [take on the BP Energy Center] for the nonprofits in Alaska.”
Elizabeth Miller
VP of Development and Communications
Alaska Community Foundation
The Alaska oil and gas industry, including multiplier effects, accounted for 77,600 jobs and $4.8 billion in wages, according to a recent McDowell Group study commissioned by the Alaska Oil and Gas Association. In addition to wages, the industry paid $3.1 billion in state and local taxes and royalties in FY2019, including $2.7 billion to state government and $449 million to local governments, the report states.

The impact of the oil and gas industry goes beyond employment and spending; many companies commit to supporting Alaskans through philanthropic efforts, from BP recognizing almost 800 extraordinary Alaskan educators with its BP Teachers of Excellence Program to ConocoPhillips Alaska investing a total of $2.6 million in Covenant House since 1983—the importance of the industry to the overall wellbeing of Alaska’s communities is clear and quantifiable.

ConocoPhillips in the Community
ConocoPhillips Alaska has, on average, contributed about $6.7 million annually to causes in Alaska since 2000, according to the company’s Community Investment Advisor Jennifer Rose.
“We do have a really strong focus on the communities where we live, work, and operate. We are Alaskans who review all the grant requests that come in. We keep our ear to the ground to understand what the community needs.”
Jennifer Rose, Community Investment Advisor
ConocoPhillips Alaska
“We are honored to have invested millions of dollars in our state through nonprofit contributions over the years,” Rose says. “We have built strong relationships with hundreds of organizations in Alaska. The impact has been significant.”

The pillars of philanthropy that guide ConocoPhillips Alaska’s giving efforts are education and youth, health and safety, natural resources, and others, such as civic programs, social services, and the arts.

Much of this giving is done through the company’s annual community grants.

“Alaska is very unique for ConocoPhillips Alaska community investment. We do have a really strong focus on the communities where we live, work, and operate,” Rose says. “We are Alaskans who review all the grant requests that come in. We keep our ear to the ground to understand what the community needs.”

The three-person community investment team reviews about 500 grant applications every year. The applications are received during May, June, and July through the company’s online portal. Once received, the applications are run through a rigorous, five-month evaluation process.

“We put together a budget and we submit that to corporate, where it gets reviewed by all of our leadership team,” Rose says. “We find out in December how much we’re able to invest in the state of Alaska, and we start dispersing funds in January.”

The types of grants handed out run the gamut of needs from those addressing statewide issues to smaller community needs.

“We get requests for boxes of pencils all the way up to a million dollar request, and every single one of those things is impactful,” Rose says. “Over the last few years, obviously, social services has required some extra attention—there’s been a lot more need. So that section of the pie chart, if you will, has grown a little bit.”

To be considered for a charitable contribution in the United States, an organization must be classified by the Internal Revenue Service as a public charity, a governmental subdivision, or an accredited school or an organization within an accredited school system.

Rose points out that recent state budget cuts to social services have not significantly swayed the type of charity work funded by ConocoPhillips Alaska.

“A lot of the social service programs that we’ve supported, we’ve supported since the 1970s and the 1980s,” Rose says. “So there hasn’t been a reactionary response to what’s been happening in our communities. We try to make sure that we’re keeping a baseline so they can keep their doors open; we’re a consistent contributor rather than a reactionary fallback.”

The employees of the oil and gas industry are also very active in Alaska communities, participating in charity efforts and sitting on local boards.

ConocoPhillips Alaska

That said, BP selling its Alaska assets to Hilcorp and withdrawing from the state may affect the ways in which ConocoPhillips is able to support Alaskans.

“Everybody in the community is really aware of that very big change in our community,” Rose says. “I am not sure what will happen next year: we could get more requests, we could get bigger requests. We’re not really sure what we’ll see when we start receiving applications in May, June, and July.”

United Way Finds a Way
One organization bracing itself for the impacts of BP’s exit is United Way of Anchorage, as BP has been the highest or second-highest annual contributor to the organization for years.

United Way of Anchorage helps convene partners, partner agencies, volunteers, companies, and employees and combines those forces to tackle problems that no individual entity or segment can work on alone, Stalzer says.

“For example, raising the graduation rate took the efforts of nonprofits and volunteers working together to achieve certain goals to turn that into a 20 point increase in our graduation rate,” Stalzer says, noting that United Way of Anchorage is also focused on financial stability for families and homelessness.

The UAA Integrated Science Building.

ConocoPhillips Alaska

She hopes that because of the direct relationships between BP employees and United Way of Anchorage—many of them decades old—those BP employees will take United Way of Anchorage up on its offer to continue to give and volunteer in their communities.

Nonetheless, Stalzer expects to feel a fallout. BP was actively engaged in a structured approach to philanthropy in the community, providing corporate funds to United Way to help with community goals.

“So BP has been, for many years, one of the most significant players in philanthropy as a whole for the state,” Stalzer says.

BP’s Legacy
With BP selling its Alaska assets to privately-owned Hilcorp, questions remain about the long-term and short-term impacts of the move on nonprofits and other organizations historically supported by BP.

BP withdrawing from Alaska is anticipated to have far-reaching effects in Alaska. Consider this: in 2018 BP donated $4 million to organizations throughout the state and its employees supported hundreds of education and community groups.

The company’s philanthropy has ranged from summer engineering programs through UAA to scholarships for graduating high school seniors. Over its forty-plus years in Alaska, BP awarded more than $3.5 million to 860 graduating high school seniors as part of the Principals’ and Commissioner’s Scholarship Program, one of the longest-running initiatives of its kind in the state.

In total, BP has given the University of Alaska system about $36 million, UAA Senior Development Officer for the College of Engineering Jayna Combs says.

“Oil and gas has been our biggest donor for sure: Conoco and BP have probably donated the largest amounts to the college,” UAA Interim Dean for the College of Engineering Kenrick Mock says, noting that other engineering firms have given a lot in terms of time and effort.

For roughly the last ten years BP has given between $100,000 and $120,000 annually to the Summer Engineering Academies, Combs says.

“These donations have really allowed the Summer Engineering Academies to be successful as a program and to accomplish our mission, which is to not only offer these great engineering-themed, hands-on educational summer camps but to do so for communities that have not always had access to those types of programs,” Summer Engineering Academies Director Joe Selmont says. “We can offer the camps at a super reduced rate thanks to BP.”

BP made its final donation to the program this year.

“They did that so we could have some gap funding so we could look for other funding sources in the coming year, which was really great of them,” Combs says. “They’ve been so impactful to our communities—not just the university but the entire state.”

Nonetheless, in preparation for a vacuum of funding, the price for the program has been increased from $150 to $250.

“Unless we can make up that funding gap, the price will have to continue to increase, which I would say goes against the core mission of reaching those underserved populations,” Selmont says.

While the MTA Foundation has already stepped up to help fill a portion of the funding gap, additional funding is still needed.

BP Energy Center
Though many questions remain for nonprofits and communities that have benefited from BP’s long-standing tradition of generous giving, there is clarity about the future of the BP Alaska Energy Center. It was dedicated as a lasting gift to the state on February 11.

“Of all the accomplishments we’ve had in Alaska, we believe this to be one of our most important. We are leaving the Energy Center here for future generations. We hope it serves as a reminder that community is what matters most,” BP Alaska President Janet Weiss says.

The Alaska Community Foundation (ACF) has been charged with taking over the management of the center, which opened in 2002 as an asset for nonprofits and educational organizations to host meetings and other activities.

“We are so honored to be chosen to carry on BP’s philanthropic vision for the BP Energy Center,” ACF Board Chair Carol Gore says. “It is a gift to the entire nonprofit community and an extraordinary opportunity to amplify our mission to inspire the spirit of giving and connect people, organizations, and causes to strengthen Alaska’s communities now and forever.”

Several years ago, the company created the BP Energy Center Fund with ACF. These funds will be used to help support the cost of operating the facility.

“We will operate the BP Energy Center just as they have operated it for the last several years for at least the next twenty years,” ACF Vice President of Development and Communications Elizabeth Miller says. “We’re focused on making this transfer as smooth as possible, so that there will be no service interruption at the BP Energy Center.”

It’s estimated that more than 100,000 people and 600 community organizations have used the facility over the last twenty years.

“We absolutely know the meaning of caring about our neighbors and the value of people coming together to solve problems. So we are excited to take this on for the nonprofits in Alaska,” Miller says.

ACF and Hilcorp
Acquiring the BP Energy Center and taking on the management of the facilities is not the only change for ACF as BP exits the state and Hilcorp increases its presence. ACF is taking over administration of Hilcorp Alaska’s giving program, Miller confirms.

“This is innovative news for philanthropy in Alaska, and a partnership we are very excited to begin,” ACF President and CEO Nina Kemppel says. “Hilcorp has a successful history of enhancing its social investment through the Greater Houston Community Foundation, and we’re thrilled to have the opportunity to take that proven model and help Hilcorp expand its corporate giving to Alaska, beginning with $5 million over the next twelve months.”

That anticipated level of giving represents an enormous spike in Hilcorp charity efforts. The company donated about $315,000 to Alaska charities in 2018.

The Hilcorp Giving Program was previously being managed for all employees, including Alaskans, by the Greater Houston Community Foundation. However, moving forward more than 90 percent of Hilcorp employees will be based in the Last Frontier, so the company chose to partner with ACF, Miller explains.

More than 400 funds will be transferred in April. The estimated 800-plus new employees set to join Hilcorp as it expands its operations in Alaska will have new charitable funds opened with ACF when they are hired.

Under the Hilcorp Giving Program, the company establishes a charitable fund for its employees with an initial gift of $2,500, according to an ACF news release. After that initial seed money, Hilcorp, like many organizations, offers annual matching on employee donations up to $2,000.

The BP Energy Center.

Joshua Lowman

Each employee is then able to direct dollars to charities of their choice. Since the program’s inception in 2007, Hilcorp employees have gifted more than $15 million to US-based nonprofit organizations, the news release says. More than $5.8 million of that is to religious organizations.

“It is an ongoing tool for the employees to do charitable giving,” Miller explains.

With the funds being housed at ACF, Hilcorp employees will be able to take advantage of the organization’s user-friendly online portal, Miller says. Through the portal, workers will easily be able to manage their accounts and direct their gifts to charities anywhere in the United States that are in good standing with the IRS.

“We also are working with Hilcorp to connect the nonprofits in Alaska with Hilcorp employees so that they can be more aware of [local] organizations to which they could direct their funds,” Miller says. “Their business philosophy is all about empowering employees to make decisions. So, we’re working with them on their giving program to honor that business model and our mission of connecting people with causes that they care about.”

Hilcorp Alaska Senior Vice President Dave Wilkins says he’s confident in ACF’s abilities to help Hilcorp employees invest in Alaska.

“We are proud to have over 90 percent of our employees from Alaska, and we are proud to be in Alaska. There is no better organization than ACF to help our employees invest in Alaska,” Wilkins says. “Whether it is an after-school program for at-risk youth, their church, or a homeless shelter, we empower our employees to become lifelong philanthropists and determine how best they can help their communities.”

The Hilcorp model for philanthropy is significantly different than BP’s, which will undoubtedly have an impact on Alaska charities and nonprofits.

“I think there definitely will be changes and adjustments that many nonprofits will have to make,” Miller says. “It really remains to be seen how big those adjustments will be, based on how Hilcorp employees choose to direct their funds.”

Moriarty agrees that it’s hard to know what BP’s exit will mean for Alaska communities.

“We don’t know what’s going to happen to corporate contributions,” Moriarty says. “But we do know that both companies have demonstrated commitment in the past, and I have no doubt that’s going to continue.”

Community and Industry—Giving Together
The charity efforts of the oil and gas industry go beyond corporate donations. Employees put in thousands of volunteer hours every year, and many sit on various nonprofit boards to fulfill their civic duties.

“In addition to the financial contributions, a lot of companies work with United Way to engage their employees and volunteerism throughout the community,” Stalzer says. “We have one big day a year called Day of Caring, which is when we see the most volunteerism.”

Employees in the oil and gas sector are incredibly engaged with Day of Caring, Stalzer notes.

“I’ve been in the nonprofit world for a long time here in Alaska. We have had to make many adjustments over the years as the landscape of the economy has changed because of oil and gas or other things,” Miller says. “I see this as another—very optimistically, very wonderful—opportunity for us to learn and to adjust.”