Candidate unveils oil, gas proposal

July 25, 2006

SPECTRUM/Gerald Heikes

The &#8220Alaska Republic Oil and Gas Co-op” is a plan worth exploring. Two pipelines are to be built: one for oil and one for gas. The pipelines are to be built and run from Prudhoe Bay to Valdez.

Two new state-of-the-art refineries will be built in or near Fairbanks - one for oil, and one for gas. This project will be financed by the permanent fund and will be completely owned by Alaskans.

The new refineries, pump stations and supporting maintenance will be let out to private companies at cost plus 10 percent. Alaska Republic Oil and Gas will retain 15 percent of all oil and gas passing through the lines. All excess not used by Alaskans will be sold at market value.

These funds will be used to support the maintenance of the lines. Any extra money will go into an interest-bearing account to handle any unforeseen maintenance or repair, or for future lines.

All royalties, taxes, etc. paid by the oil-producing companies using the new line will be based on the original agreements from the first line. Royalties, taxes, etc., from the new oil and gas lines will create a new and separate permanent fund called &#8220The Alaska Republic Royalty Fund,” which will be operated on the same basis as the original permanent fund, with the following

exceptions:

1- Only U.S. citizens who are Alaska residents on or by June 30, 2006, will be eligible;

2- Any woman who is pregnant, a U.S. citizen, naturalized or by birth who is residing in Alaska June 30, 2006, and is not a resident, the child will be eligible;

3- There will be no new members added to this account;

4- All members will receive their dividends for life no matter where they reside;

5- 25 percent of all earnings in a one-year time frame will be divested to shareholders. The rest is to be kept for growth investment;

6- Upon the death of a member, his or her dividend will be bequeathed to a charity or an Alaska college.

This initiative is meant to create a free and independent state from market forces in gas and oil, and to set up a structure with guidelines so our generation and future generations will have lifetimes of

benefits.

This system would benefit Alaskans in many ways. Heating, electric and gasoline costs would never fluctuate after the first two years of operation. A 2,500-square-foot home in Fairbanks would cost approximately $300 a year for gas heating.

Gasoline and diesel prices would be between 75 cents and $1 per gallon. Electric prices would never vary, and the cost of goods would come down because transportation costs would be less.

The estimated cost of the project would be $17-$20 billion, and the estimated construction time would be 3.5 years. The permanent fund would pay for the construction, but money would be withdrawn only as needed, not all at once - approximately $6.5 billion per year.

Qualified Alaskans still would receive their yearly permanent fund dividends during construction of the pipelines.

My vision is to have an Alaska where all of its people have a chance to prosper. Make no mistake, there will be a fight. But you have to be willing to sacrifice the present for your future, as any parent knows.

There will be those who will oppose this, especially oil companies and the federal government. But the reward will be a truly free and independent state, where its people and generations following will benefit and prosper.

There was an idea once, that became a rough draft, that became a vision. After a fight, and a lot of sacrifice, it became a reality. It was called the Declaration of Independence.

Palmer resident Gerald L. Heikes is a Republican candidate for governor.