Absent from Alaska’s budget debate are comparisons of owner/producer profit-sharing agreements in other oil producing countries. How do we compare? The big three want this question off the table. Our news outlets suffer a painful withholding of advertising revenue any time they address this issue.
According to ConocoPhillips’ unaudited report, they were netting over $17 per barrel from last quarter’s Alaska production. The way things work on the North Slope, if Conoco was making $17, so was British Petroleum and ExxonMobil. I have studied international oil tax policies for over 30 years. I highly doubt that BP, Conoco, or Exxon can point to another country that lets them keep more than $5 per barrel in today’s market. It is a fact that BP, Conoco and Exxon produce oil in exchange for cost plus $1 profit per barrel in several countries.
Last quarter Alaska produced about 46 million barrels. Had we kept $12 of the $17 and let them keep $5, they would have cried all the way to the bank and continued producing. Alaska would have received an additional $550 million for the quarter. Four quarters of the same would add up to $2.2 billion. Passing an income tax will take the pressure off of our oil-company-owned Legislature to get your rightful share of profits from our state-owned oil.
Ray Metcalfe,
Anchorage