As the content director of the Arctic Imperative Summit, I had the opportunity to join elected leaders of the Alaska State Legislature, as well as representatives of industry, utility and renewable energy nonprofits, and economic development non-profits to learn how Norway manages its oil wealth during the week of Aug. 27, 2011, through Sept. 4, 2011, on a tour hosted by the Institute of the North.
Arriving in Oslo, compared to other nation’s capitals: London, Paris, and Washington D.C., the city seemed quite, quaint, and peaceful.
Rather than cars rushing by, central Oslo was full of people walking, and street cars passing along. The peacefulness of the city made me realize how out-of-place and devastating the July 22, 2011, bombing and shootings were that the city endured. What could we Alaskans learn?
Norway discovered oil in December of 1969, roughly the same time as Alaska. While it is hard to draw direct comparisons, because of vastly different histories and regulatory regimes, the numbers tell a compelling story that makes one ask, “How’d they do it and why haven’t we done more in Alaska?”
Norway’s sovereign wealth fund is $550 billion compared to Alaska’s Permanent Fund of $40 billion. While much of Alaska’s oil is developed with the expertise of international oil companies, Norway created its own oil production company, Statoil that also enters into joint ventures with international oil companies. The Norwegian State makes a financial investment in production projects through a state-owned company Petoro. All businesses in Norway are taxed at 28 percent of profits, while offshore oil and gas projects are taxed at 50 percent, equaling a 78 percent tax rate on profits. Only 28 percent of the state revenues come from petroleum compared to Alaska’s 85 percent. Ninety-nine percent of electricity in Norway is produced by hydropower.
What was most compelling among the Norwegian officials that we met with were the values of sharing and public service, explained to be ingrained in Norwegian society. The same values ingrained in our Iñupiaq culture and paramount in our Native institutions, the regional for-profit and nonprofit corporations. Norway has achieved universal healthcare and education equity for its residents. One rural Alaska legislator asked a Norwegian official about fuel prices in rural Norway, and the response was that the country believes energy prices should be the same as in the urban areas.
It was tremendous to learn what Norway could achieve with its great oil wealth. Returning home, immense frustration boils when thinking of the battles of resource development in Alaska, not to mention the worry of declining state oil revenues. Norway feels like a government that has ensured that its oil wealth translates directly to its citizens, both urban and rural, while it feels like rural Alaskan residents must fight tooth and nail for the same equalities.
I had the honor of attending the Arctic Economic Summit in Kotzebue, Aug. 3-5, 2011. So much Iñupiaq pride filled my heart hearing the Iñupiaq dialects; however, a sobering thought could not leave my mind — listening to the leaders of the North Slope and the Northwest Arctic — as well as the mining and oil companies doing business in the north, I realized those Iñupiaq communities bear the risk of oil and mining development on their Iñupiaq homelands both onshore and offshore, of which the benefits, including state revenues, are benefits that all the residents of Alaska enjoy.
Yet, whether real or perceived, battles are constant with the state of Alaska, not only for education equities, but basic functions of government responsibility such as adequate law enforcement and investment in public infrastructure. Why are so many oil jobs on the North Slope going to non-Alaskan residents? What are we doing to ensure the wealth of future generations? Why must cooperation and commitment only come after heavy negotiation with lawyers and/or lawsuits?
We ended our stay in Norway with a visit to Tromso, a university town of 60,000 residents at 69 degrees north, the same latitude as Point Lay. I could not help to think that our state, 50 years young, could learn so much from our 10,000-year-old Iñupiaq culture, based on the fundamental value of sharing wealth.
Megan Alvanna-Stimpfle is a King Island Iñupiat from Nome and former rural affairs coordinator for U.S. Sen. Lisa Murkowski.
This commentary was first published by The Arctic Sounder on September 22, 2011, and is republished here with permission.
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