When politicians talk about "ownership," they usually are referring to home ownership and invoking the American dream. But a gubernatorial candidate in Alaska is campaigning on the idea of citizen ownership of the state's biggest dream: the Alaska gas pipeline.
Democrat Ethan Berkowitz is touting a plan he calls "the Alaskan ownership stake," which would promote citizen investment in the long-sought gasline to Lower 48 markets. Two parties are vying to construction the line: TransCanada Corp. and partner ExxonMobil Corp, which have the state concession to construct the line under the state's Alaska Gasline Inducement Act; and partners BP plc and ConocoPhillips, which are backing a project called Denali (see Daily GPI, Aug. 9).
"It ensures that all Alaskans have the opportunity to 'own a piece of the pipe,'" Berkowitz said on his website. "This idea builds on a proposal that Sen. Ted Stevens, Sen. Lisa Murkowski and Rep. Don Young [all Republicans] included in the 2004 federal Alaska Natural Gas Pipeline Act. That legislation specifically recognized the importance of allowing individual Alaskans, Alaskan-owned companies and Alaska Native corporations to invest in the pipeline to further economic development.
"As governor, I will work with the legislature to allow and encourage Alaska businesses and Alaska Native corporations to also participate in investing in the project." Berkowitz said if Alaskans can invest in the pipeline, it improves the chances that it will get built.
The proposal would allow Alaskans to choose to invest some or all of their annual Permanent Fund Dividend (PFD) from the state's oil production in the Great Alaska Pipeline Co. Inc. (GAP), which is yet to be created. Funds would be held in escrow until a pipeline is fully funded and construction begins.
Profits realized from pipeline revenue would be distributed to investors. "As owners of GAP Inc., individual Alaskans and Alaskan entities that choose to invest will receive their share of the distributions of these profits annually," Berkowitz said. "These distributions are separate and distinct from our PFDs.
"Alaskans could choose every year during the pre-construction and construction phases of the pipeline to invest multiple years' worth of their PFDs into GAP Inc. The elapsed time from the first offering to the construction year will span several years, giving Alaskans many opportunities to invest multiple PFDs into GAP Inc. if they choose."
Funds would not be distributed to investors until either the pipeline is financed and under construction or it is determined that a project is not viable, Berkowitz said. He claimed that no Alaska governor since 2005 has advanced a plan that would allow Alaskans to invest their own money in a pipeline.
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