Billions for BP: Trickle Down for Alaska
18 February 2006British Petroleum raked in $66 billion dollars in revenue this last quarter, up 22% over the previous quarter. BP cleared $3.7 billion in profits during the same period. A lot of this revenue came from Alaska oil, oil that belongs to Alaskans–oil that belongs to homeless Alaskans, Alaska veterans, Alaska children who do not have health insurance, Alaska young people that cannot afford tuition, and Alaska rural residents who have seen their village budgets decimated. It is our oil, but their revenue, and their profits. Sounds like bad public policy, but–better late than never–perhaps this gross injustice will be tweaked in the not too distant future…
Ray Metcalfe, the guy who beats the drum for the Republican Moderate Party of Alaska, has some very interesting original research and commentary regarding how Alaska taxes the energy corporations. See, for example, his compelling chart comparing Alaska oil taxation rates with the rest of the world. His conclusion, “Alaska is the lowest taxing major oil producer in the world.” Metcalfe also has a concise description of ELF, the Economic Limit Factor tax on the oil industry, and a table showing a field by field analysis of increased revenue to Alaska if the ELF were eliminated.
The Democrats have recently submitted proposed legislation sponsored by Sen. Hollis French (D-Anchorage) in the Senate (SB 292) and by Rep. Les Gara (D-Anchorage) in the House (HB 466). according to the accompanying press release,
The legislation requires a profit sharing production tax that has been suggested recently as a way for Alaskans to get their fair share from the state’s oil. Democrats see the introduction of the bill as only the beginning of the process. Democratic Legislators plan to use public input to help refine the legislation to meet several goals.
Among those goals is ensuring the state, and Alaskans, receive the maximum economic benefit from Alaska’s oil resources. Other goals include encouraging a broad range of oil and gas exploration and production; encourage independent oil and gas companies to do business in Alaska; enhance international competitiveness; ensure efficient and effective administration of the tax system and provide energy for Alaskans.
The primary goal is to get the process moving forward, said French. “We’re taking the lead to make sure this important proposal sees the light of day.”
You can find copies of these bills, and information about their progress at BASIS, the Alaska Legislature’s Bill Action and Status Inquiry System. Recent informal reports indicate that the system is a bit behind in postings, so the very latest information may take a while to post.
Any serious, critical discussion of the energy industry in Alaska has to include a detailed perusal of Richard Fineberg’s extraordinary work, found at Finebergresearch.com. I have praised Finebergs work in the past on this blog. See, for example, the summary of a report he released last summer regarding monopoly control and excessive profits generated by the energy corporations in Alaska.
Meanwhile, the Governor continues well into the second year of secret negotiations with the oil corporations regarding the disposition of public resources, and the return to the people of Alaska from the private exploitation of those resources. Go figure.
ldw