We need in-state resource processing

Letter to the editor

Posted: Tuesday, August 08, 2006

This is in response to Rep. Coghill's Anchorage Daily News article, "Add value to Alaska oil with tax incentives," of July 31.

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Because I am interested in Alaska adding value to our nonrenewable and renewable resources, I found Coghill's comments very interesting.

My concept of adding value goes beyond encouraging the taking of our resources and shipping them out of our state without adding value. Simply collecting royalties, property taxes and corporate income taxes does not "add value." We are doing that with our fish, timber, mining and oil and gas industries.

Value is added to our gas in Cook Inlet by Agrium producing fertilizer and other products. Value is added at our in-state refineries that turn our royalty oil into gasoline, jet fuel, heating fuel and diesel. Value is added to our fish when we process them here and sell the final product to an end user. Value is added to our timber when we manufacture wood products and sell them to the public. Value is added to our minerals when we refine them in our state and turn those minerals into material that the world's economies are demanding.

No value is added to any of our resources by simply being an "extractive" state owned by Outside interests. We do not have a secure future economy if most of our oil and gas is simply piped out of our state and hauled someplace else to add value. We lose out when that happens.

Most of our oil and gas, much of our fish, virtually all of our timber and a large portion of our minerals are further processed outside of our state. Those jobs that are associated with adding value to our raw resources are lost, and we can never get them back. That has to change.

As Coghill correctly stated, our state's constitution "mandates that we provide the maximum benefit from our resources to the people of Alaska." If we are going to do that, then we must truly "add value" to our renewable and nonrenewable resources by making sure we have policies that honor that mandate.

That means in-state processing of all of our renewable and nonrenewable resources. If we do that, we will truly reach the potential that our constitution envisions for the people of Alaska.

Nels Anderson Jr.


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