The company that acquired the scandal-plagued Alaska oilfield services firm Veco in 2007 now plans to sell some of its Alaska business interests, along with its oil and gas operations on Russia's Sakhalin Island.
Colorado-based CH2M Hill said Wednesday it "intends to explore strategic alternatives for the portion of its oil, gas and chemicals business" located in and serving Alaska and Sakhalin.
"The Alaska and Sakhalin oil and gas business, and its dedicated and experienced workforce, have made significant contributions to the growth and value of our company," CH2M Hill Energy President Rob Berra said in a statement. "It is a high-quality, well-run business with longstanding client relationships that we believe has strong future prospects. We intend (to) explore 'win-win' options for our employees and clients, and we remain focused on ensuring that our clients continue to receive the highest quality service."
The company said it will maintain some of its services and "will continue to serve a broad range of clients" in the state.
"Our core infrastructure services and functions including water, transportation and environment will be our focus," said John Corsi, CH2M Hill spokesperson.
Veco, which had been Alaska's largest oilfield services company, was at the center of a political corruption scandal that resulted in criminal charges against then-Sen. Ted Stevens and several legislators and politically powerful Alaskans.
The potential sale announced Wednesday would be specific to oil-related businesses acquired by CH2M Hill from Veco, Corsi said. CH2M Hill will continue to provide support services for the National Science Foundation's Arctic Research programs, Corsi said.
Veco had also previously provided support to Arctic research programs. CH2M Hill's Arctic research support operations now span the circumpolar region.
CH2M Hill bought Veco in 2007, the same year Veco's chief executive, Bill Allen, and a vice president, Richard Smith, pleaded guilty to bribing public officials and other crimes. CH2M Hill removed the Veco name from the Alaska business.
The sale to CH2M Hill provided $146 million to Veco's six owners, the Anchorage Daily News reported in 2008.
If CH2M Hill ends up selling all of its oil-field assets acquired from Veco, that does not send any particular message about the Alaska oil industry, said Matt Berman, an economist at the University of Alaska Anchorage's Institute of Social and Economic Research.
The oil-related Alaska and Sakhalin assets likely remain valuable, Berman said. "They're not going to give it away," he said.
He noted CH2M Hill acquired Veco in something of a "fire sale," a transaction that had to happen quickly because of the criminal penalties looming over Veco's leaders.
"Veco needed to sell in a hurry, because Bill Allen was going to go to jail," Berman said. "There might not have been any other companies to take it on that quickly."
Veco's downfall came in a federal investigation of political corruption in Alaska. Much of the investigation focused on payments and promises made by Allen and Smith to state legislators for pro-industry votes on a pending tax bill.
Veco, which dates back to the early days of Prudhoe Bay-area oil drilling, became nationally famous as the main cleanup contractor for the Exxon Valdez oil spill.
The company and its chief executive had a checkered record even aside from the corruption scandal that ultimately put legislators and corporate officials in prison. Veco and its officers also faced the Alaska Public Offices Commission for illegal campaign donations. The company was entangled in cases of sexual harassment against female employees, two of which reached the state Supreme Court.
And Allen was implicated in an investigation of sex crimes involving underage girls. No charges were filed against him, but another prominent Alaska businessman, Josef Boehm, was convicted of sex- and drug-related charges.
After the acquisition of Veco, CH2M Hill officials said the corporation would steer clear of partisan politics in Alaska -- making sure no employee felt pressured to take any particular stance -- and that it would maintain a strong ethics policy.
The company was honored several times by the international Ethisphere Institute, which named CH2M Hill among the world's most ethical companies.
CH2M Hill has not been entirely silent about Alaska political issues during its time in the state, however. Company employees were active in promoting SB 21, the 2013 state legislation that changed Alaska's oil tax system, and the company was among those opposing a ballot referendum to repeal that tax change earlier this year.
Clarification: This story has been updated to more accurately reflect the scope of interests that CH2M Hill is interested in selling.