Anchorage Daily News

Conoco Phillips pledged $15 million over the next five years to the University of Alaska Anchorage at a Wednesday ceremony naming a new science building after the oil giant.

The donation is the largest Conoco has given in Alaska and the largest corporate donation UAA has received. It tops a donation of $5 million to Providence Alaska Medical Center in January and marks another substantial gift by the company, which, under a 1999 agreement with the state, must share in the largess of record-high oil prices with charitable organizations.

It's another way Alaska, unlike most of the United States, is benefitting from the oil prices, which leapt to $120 a barrel last month. The oil bonanza has given the state, which derives most of its general funding from oil taxes, huge revenue surpluses.

In the past several years, Conoco has poured tens of millions of dollars into local charities. Much, if not all, of that giving is required under the corporate charter negotiated between the state and Phillips Alaska when Phillips Alaska Inc. bought Arco Alaska Inc. This was before the merger that created Conoco Phillips.

BP must follow the same contribution rules as Conoco under the agreement.

The companies must give away a certain percentage of their previous year's revenue -- specifically, a value equal to 0.2 percent of its Alaska production multiplied by oil prices. The charter says at least 30 percent of the giving must be to the University of Alaska Foundation.

In 2006 and 2007 combined, amid rising oil prices, Conoco was obligated to give away about $25 million. It exceeded its obligation by about $100,000, said spokeswoman Natalie Lowman.

This year, the company is expected to give away about $13 million based on its 2007 Alaska oil production, which earned Conoco $2.3 billion in profits, according to its filings with the U.S. Securities and Exchange Commission.

In 2007, BP was obligated to give away about $11 million but gave over that by $500,000, according to spokesman Steve Rinehart. Some of the company's recent contributions have been $840,000 to the Mountain View library, and $2 million to Providence hospital.

The latest Conoco pledge gives $4 million for science equipment and $11 million for an endowment to be called the Conoco Phillips Arctic Science and Engineering Endowment. The $4 million will be paid out over two years. The $11 million is to be paid out over five.

UAA is the state's largest university, with 15,000 students.

Conoco Phillips Alaska president Jim Bowles said the recent high prices of oil did not influence the unusually large donation.

"That's one reason we are structuring these out over time," he said, standing before the newly named Conoco Phillips Integrated Science Building at Wednesday's press conference. "We're not looking at the $100 oil that's driving this. Really, these are some good opportunities to give back to the community."

The 128,000-square-foot, $93 million science building named after the oil company is scheduled for completion in fall 2009. The naming of the building is temporary, according to a press release from Conoco. After 25 years, Conoco has the first right of refusal to make a new investment in UAA and buy the naming rights again.

Find Megan Holland online at adn.com/contact/mholland or call 257-4343.

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