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Climate forum hears of investment interest in Arctic

Alaska Dispatch's Rogoff said Guggenheim Partners looking to invest billions

Posted: November 13, 2011 - 1:04am

A major hedge fund manager is developing a new Arctic investment fund to take advantage of moneymaking opportunities in an increasingly ice-free Arctic, a climate change conference was told Saturday.

That could help bring needed infrastructure development to the region said Alice Rogoff, publisher of the AlaskaDispatch.com website.

Rogoff spoke to the Juneau World Affairs Council’s “Politics of Global Climate Change” forum that concluded Saturday at the University of Alaska Southeast

Rogoff said Alaska needs to be ready to capitalize on the Arctic’s new investment interest, and wants the state ready to attract some of that new investment in places where it wants and needs the development.

“What is good development, and how can it come about in some sort of orderly way,” she said.

The Arctic investment fund that Rogoff revealed will be managed by Guggenheim Partners, a firm with $125 billion in assets under management.

She said the investment interest by Guggenheim Partners of billions in the Arctic was “huge news” that would merit a big headline in the Wall Street Journal — if it knew about it.

Prior to Rogoff’s adopting Alaska as her new home and purchasing the Alaska Dispatch, she was an executive in the Washington Post Co., where she was publisher of its National Weekly Edition and chief financial officer for the U.S. News and World Report.

She is married to David Rubenstein, co-founder and managing director of The Carlyle Group.

Lt. Gov. Mead Treadwell, an Arctic expert and one of the forum speakers, later called it a “major announcement” that Guggenheim Partners would be assembling capital from around the globe to invest in the region, even while most Americans are unaware of how much its strategic location and resources may be able to contribute to the nation.

“We often have to convince the rest of the country we are an Arctic nation, and we are an Arctic nation because of Alaska,” he said.

Treadwell himself was a venture capital investor before becoming the state’s No. 2 elected official.

Rogoff said Alaska’s lack of infrastructure was highlighted when the mayor of Little Diomede turned down an invitation to an Alaska Dispatch Arctic conference because she didn’t know if she’d be able to get home.

The island, which Rogoff called the “single most strategically location place” in Alaska, has neither a dock nor a runway.

During the winter, planes land on the sea ice, but the availability of that sea ice runway is usable for shorter and shorter periods, she said.

“What little bit of money would it cost to have a dock or heliport or regularly open runway,” she asked.

One possible Arctic investment that was discussed was tied to a possible plan to finance the construction of a new heavy icebreaker for Alaska by having the Coast Guard lease it from a private-sector builder, Rogoff said.

That idea was dismissed by another forum attendee, former Coast Guard officer Lawson Brigham, who commanded the icebreaker Polar Sea in both the Arctic and Antarctic.

The Coast Guard is an inherent federal institution, he said, and as part of the U.S. Navy during wartime needed fully funded icebreakers.

The nearest deepwater port to Alaska’s Arctic is at Dutch Harbor in the Aleutians, Treadwell said. That’s 900 miles from key oil producing areas.

That’s added extra costs to offshore oil drilling efforts by Shell and others, he said, which will have to bring 14 ships to support its oil drilling and spill response efforts.

“They’ve got their own flotilla, they’re bringing that capacity with them,” he said.

Treadwell said Alaska needs more development, but didn’t endorse any specific project.

• Contact reporter Pat Forgey at 523-2250 or at patrick.forgey@juneauempire.com.

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