2/13/12

Please read HCR 19 introduced 2/8/12 "Acknowledging the lessons learned form the 2011 Norway Policy Tour and encouraging investment in the state’s oil and gas industry."

There was about an hour presentation to Alaska Legislature 1/26/12 "'Lunch and Learn Lessons Learned from Norway Presentation by Institute of the North" as follows:

http://gavelalaska.org/media

Click on the left "Media Archives." To get the presentation, go to "All Categories" from 1/26/12 to 1/26/12. Scroll down to "Lunch and Learn." If you have problems bringing it up, please call Justin Heard (907)463-6401.

Mr. Ira Perman, President, Institute of the North, introduced Mr. Nils Andreassen, Managing Director, and Mr. Bradford Keithley, Partner, Perkins Coie, who was licensed to practice law in Alaska in 2010. Both gave insights about the 2011 Policy Tour. The problem with the Presentation was what Ira Perman said at the end. His statements were that the reason the Norwegians have a $600 Billion fund is that they do not give out Dividends! That is ridiculous and untrue. Ira also bragged about the Rasmuson Foundation which is a control mechanism and is not a foundation at all.

As regards the Dividend, per http://www.apfc.org each year it is about $700,000,000 including new residents and immigrant aliens of the about $40,000,000,000 currently. Therefore, the Dividend is 1.4% of the total amount of APF. The Dividend is not the reason Alaska Permanent Fund since 1976 is only $40,000,000,000. It is because a handful of Board members are "Insider Trading" which anywhere else in the U.S. would be a chargeable criminal offense. Here in Alaska what APFB does is completely legal. APFB are enriching their own pockets; they could care less about "our rainy day account." It really is scandalous. The Norway Oil Fund was developed about 1991 and it is up to $600 Billion. APF is about 6.6% the amount of the Norway Oil Fund. Why? Norway does have more oil development than Alaska but they always partner with oil companies taking the risks and profits. Alaska does not partner at all. We just let the oil companies buy the leases for pennies and take all the profits out of Alaska.

11/4/11

Trond-Erik Johansen, President, Conoco-Phillips Alaska since 2010. (internal link)
He is Norwegian citizen.
Statoil, the Norwegian Oil Company, has an office in Anchorage, Alaska.

9/22/11

Senator Hollis French, Attorney,
ADN Column "Alaska's oil tax is working just fine"

9/9/11

Former Gubernatorial Candidate 2010 Bill Walker, Attorney,
ADN Column "Norway can teach us to control resources"

9/7/11

Larry Persily, Federal Coordinator,
Alaska Natural Gas Transportation Projects

6/16/11

Patti Epler, Alaska Dispatch
"Statoil open Anchorage office" Statoil's primary consultant is Ken Boyd, former Alaska Division of Oil and Gas Director, with an office of a half a dozen people at JL Tower, Centerpoint Drive, near 40th and C Street, Anchorage

9/15/10

Jill Burke, Alaska Dispatch "Stateoil looking at 2014 for offshore Alaska drilling"
This is scary. Alaska is being totally ripped off by the Norwegians as well as U.S.

9/11

12 Alaska Legislators including Senator Stevens, Senator Ellis, Senator French, Senator Thomas, Senator Hoffman, Senator Menard, Senator Olson, Senator Wagoner, Representative Herron, Representative Edgmon, Representative Seaton, and Representative Foster went to Norway sponsored by Institute of the North August 27-Sept. 4, 2011

It was typical of our corrupt Alaska media that is about 95% owned in many states of the Lower 48 that Alaska Legislators’ trip to Norway was presented as though it is some kind of junket. There has not been a better expenditure of money by Alaska Legislature in a long time. More Alaska Legislators should go to Norway for this educational program.

Per the below article 6/16/11, the Norway Oil Fund is currently valued at $570 Billion. It was started in 1991. Our Alaska Permanent Fund was begun in 1976 and has remained at $30 to $35 Billion for a decade or more. It has only in the last few months gone up to $40 Billion. The Norwegians have put Alaska to shame!

We understand that there are two separate Norwegian sovereign wealth funds including the Government Petroleum Fund which invests Norwegian petroleum income and the National Insurance Scheme Fund which provides health care for the almost 5 million Norwegians. "The budgetary rule" allows a maximum of 4% of the Norway Petroleum Fund's yield to be allocated to the yearly government budget.

Honorary Consul of Norway since 2007 is Mr. Erling Johansen, Assistant Attorney General, Labor & State Affairs Section, 1031 West 4th Avenue, Suite 200, Anchorage, Alaska 99501 (907)269-6612. From 1994 to 2007, Mr. Anton Zahl Meyer, 8210 Sundi Drive, Anchorage, Alaska 99502, (907)243-4459 was Honorary Consul.

What is Alaska Permanent Fund Board (APFB) doing wrong? We believe that APFB members are focused primarily on their own investments which anywhere else in the U.S. would be labeled "insider trading." APFB hire the investment managers who give them the best stock market investment advice imaginable. If that advice does not reap astronomical financial rewards for the Board members, the investment managers are fired.

Norway Oil Fund May Target Private Equity

By Josiane Kremer - Jun 16, 2011

Norways $570 billion oil fund may get more leeway to expand into new asset classes such as roads, gas pipelines and unlisted shares as the government switches its top adviser for setting the investors guidelines.

Former central bank Governor Svein Gjedrem, 61, this week started as secretary general at the Finance Ministry and chief adviser on investment rules for the oil fund, succeeding 64- year-old Tore Eriksen. The switch allows Gjedrem to revive proposals blocked by the ministry in April to expand the funds investments, according to Knut Anton Mork, chief economist at Svenska Handelsbanken AB in Oslo.

Gjedrem is a person of very powerful ability of persuasion, Mork said by phone. The ministry will do what he wants. I see no reason why Gjedrem should have changed his view on this matter and against that background I expect the ministry to change course and allow for these new asset classes.

Gjedrem, who declined to comment on how he will advise the ministry when contacted by e-mail, started his new job on June 11. He argued last year that the oil fund is well-suited to harvest liquidity premiums from infrastructure and private equity investments, in a report co-written with the funds

Chief Executive Officer Yngve Slyngstad.

Eriksen, by contrast, said in an interview last week that the fund needs to adopt a conservative approach and avoid experiments after it lost a record $116 billion at the height of the global crisis in 2008. The fund cut its Greek debt holdings in the first quarter, after last year raising its positions in bonds sold by Europes most indebted nations.

Bigger Returns

On Jan. 1, the range by which the fund can deviate from the benchmark it tracks was cut to 1 percentage point from 1.5 percentage points. The fund returned 9.6 percent last year as stock markets rallied, adding to a 26 percent gain in 2009. It grew 2.1 percent in the first quarter, the smallest return since the second quarter of 2010, as European bonds slumped.

The fund probably overtook Abu Dhabis Investment Authority to be ranked the worlds biggest this year, Massachusetts-based Monitor estimates. According to June rankings from the Sovereign Wealth Fund Institute in California, Norways wealth fund is the worlds second largest.

Since 1998, the oil fund has had an annualized, real return of 3.03 percent. The investor should take on more risk to help achieve its long-term target of a 4 percent return, the government-appointed Strategy Council, led by London Business School Professor Emeritus Elroy Dimson, said in November.

Abu Dhabi, Temasek

Other wealth funds such as Singapores Temasek Holdings Pte and Abu Dhabi are already investing in infrastructure and private equity to spread risk and boost returns. The Abu Dhabi fund, together with a group including Canada Pension Plan Investment, this month agreed to pay $3.2 billion for a 24 percent stake in Norways natural gas pipeline network.

The choice of adviser is likely to shape the oil funds investment decisions because the permanent staff of the finance ministry is traditionally quite influential in setting operational rules, Mork said.

While Gjedrem will be the ministrys chief adviser for the fund, final decisions will be made at the political level by Finance Minister Sigbjoern Johnsen.

The ministry is open to the option of letting the oil fund expand into more asset classes, though such new investments wont be done now, according to a transcript of comments by Johnsen to parliament, received by e-mail today.

Too Complicated

Eriksen wants his successor to avoid rapidly increasing the investment universe further, he said in the June 8 interview. The fund should eschew too complicated asset classes and not experiment too much, he said.

Eriksen, who will become Norways ambassador to the Organization for Economic Cooperation and Development in Paris in September, warned that with a big fund there are a lot of management challenges and the more complicated we make the fund the more complicated the management will be.

Europes biggest equity investor, which got its first capital infusion in 1996, is mandated to hold 60 percent in stocks, 35 percent in bonds and 5 percent in real estate. The fund first moved into stocks in 1998, added emerging markets in 2000 and this year bought real estate to lift returns and safeguard the wealth of the worlds seventh-largest oil exporter. The fund invests outside Norway to avoid stoking inflation. It completed its first real-estate investment this year when it bought 25 percent in the U.K. Crown Estates Regent Street properties.

Strategy Criticized

Its much more complicated to invest in properties, in infrastructure than in equity and bonds, which you can buy every day on every market, Eriksen said.

While the investor mostly buys securities by following global indexes, it has some leeway to stray from those benchmarks to boost returns. The strategy was criticized after active management of its bond holdings contributed to its record 633 billion-krone ($116 billion) loss three years ago, prompting the ministry to tighten guidelines.

Norway, a nation of 4.9 million people, generates money for the fund from taxes on oil and gas, ownership of petroleum fields and dividends from its 67 percent stake in Statoil ASA, the countrys biggest energy company. Norway is also the worlds second-largest gas exporter.

To contact the reporter on this story: Josiane Kremer in Oslo.

To contact the editor responsible for this story: Tasneem Brogger

Original Article from Bloomberg