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                                                                   EXHIBIT 10.19

                               SEMCO ENERGY, INC.
                       2004 STOCK AWARD AND INCENTIVE PLAN

                         EMPLOYEE STOCK OPTION AGREEMENT
<TABLE>
<S>                             <C>
Optionee:                       [First Middle Last]

Total Shares Under Option:      [  ] shares

Option Price:                   $[  ] per share

Grant Date:
                                -----------------
</TABLE>

      THIS STOCK OPTION AGREEMENT is effective as of the Grant Date stated
above, by and between SEMCO Energy, Inc. and the Optionee.

      WHEREAS, the options described in this Agreement have been granted
pursuant to, and are governed by, the Plan;

      NOW, THEREFORE, SEMCO Energy, Inc. and the Optionee hereby agree as
follows:

1. OPTION GRANT. Subject to the terms and conditions of this Agreement, the
Company hereby grants an option to the Optionee to purchase from the Company, at
the Option Price, the number of shares of Stock equal to the Total Shares Under
Option.

2. VESTING.

      (a) REGULAR VESTING. Except as stated in Sections 2(b) and 2(c) of this
Agreement, the Optionee shall become vested in a percentage of the Total Shares
Under Option in accordance with the following schedule:

<TABLE>
<CAPTION>
                                            PERCENTAGE OF TOTAL
         VESTING DATE                       SHARES UNDER OPTION
--------------------------------            -------------------
<S>                                         <C>
First anniversary of Grant Date                     33%
Second anniversary of Grant Date                    33%
Third anniversary of Grant Date                     34%
</TABLE>

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The number of shares granted to the Optionee under this Agreement which become
vested on a Vesting Date in accordance with the above schedule will be
determined by multiplying the Total Shares Under Option by the percentage
specified in the above schedule, and then rounding the resulting number up to
the nearest whole number, provided that the aggregate number of the Optionee's
vested shares under this Agreement shall not exceed the Total Shares Under
Option. Notwithstanding anything in this Agreement to the contrary, no Vesting
Date will occur following Optionee's termination of employment with the Company.

      (b) ACCELERATED VESTING. Notwithstanding the vesting schedule specified in
Section 2(a) of this Agreement, the Total Shares Under Option shall become 100%
vested upon the earliest to occur of the following Vesting Dates:

            (i)   the Optionee's Retirement Date;

            (ii)  the Optionee's Disability Retirement Date;

            (iii) the date of the Optionee's death prior to his termination of
                  employment from the Company; or

            (iv)  the date of a Change of Control;

If more than one of the accelerated vesting rules specified in this Section 2(b)
can apply to the Optionee, the Optionee will be deemed to have elected the
available accelerated vesting rule which provides the longest exercise period.

      (c) TERMINATION FOR CAUSE. Notwithstanding anything in this Agreement to
the contrary, if the Company terminates the Optionee's employment for Cause
prior to a Change of Control, this Agreement shall be terminated and all options
granted to the Optionee under this Agreement shall be forfeited, regardless of
whether a Vesting Date has occurred on or before such termination date, unless
and to the extent that the Committee determines that such forfeiture would
violate applicable law.

3. EXERCISE OF OPTIONS.

      (a) GENERAL. Except as otherwise specified by the Committee in accordance
with Sections 3(c) and 3(d), the Optionee (or his Representative, as the case
may be) may exercise the

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options granted under the Agreement, in whole or in part, at any time on or
after the Vesting Date for such options and prior to their Expiration Date, by
complying with the procedures described in this Section 3. The Optionee shall
forfeit all rights to any option under this Agreement, whether or not then
vested, which is not exercised prior to its Expiration Date.

      (b) EXERCISE PROCEDURE. The Optionee or his Representative (if applicable)
may exercise all or a portion of his vested options under this Agreement by
delivering notice to the Company. The notice shall specify the number of shares
of Stock that the Optionee desires to purchase by exercise of his vested
options, and shall include payment for the Exercise Amount of such shares in one
of the following ways:

            (i)   The Optionee may tender payment of the Exercise Amount on the
                  date of exercise in the form of cash, certified check, bank
                  draft, or postal or express money order made payable to the
                  order of the Company and denominated in U.S. dollars; or

            (ii)  The Optionee may tender payment of the Exercise Amount on the
                  date of exercise in the form of shares of Stock having a Fair
                  Market Value on the date of exercise equal to the Exercise
                  Amount (if such shares were acquired upon exercise of an
                  option, they must have been held by the Optionee for at least
                  six months at the time of tender); or

            (iii) The Optionee may tender payment of the Exercise Amount on the
                  date of exercise in a combination of (A) shares of Stock
                  (subject to the holding period described in paragraph (ii)
                  above); and (B) cash, certified check, bank draft, or postal
                  or express money order made payable to the order of the
                  Company and denominated in U.S. dollars, equal to the
                  difference between the Exercise Amount and the Fair Market
                  Value of the tendered shares of Stock on the date of exercise;
                  or

            (iv)  The Optionee may initiate a cashless exercise in accordance
                  with procedures promulgated by the Committee, if any.

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Within 30 days after the date of such exercise, the Company shall make available
to the Optionee a certificate registered in the Optionee's name or a book entry
in a depository institution for the Optionee's account, representing the
aggregate number of shares of Stock purchased by the Optionee as a result of
such exercise.

      (c) EXERCISE OF OPTIONS DURING LEAVE OF ABSENCE. Notwithstanding any
provision of this Agreement to the contrary, if the Optionee is on a leave of
absence or is absent on military or government service at any time on or after
the Grant Date and prior to the Expiration Date, the Optionee may not exercise
any part of the Total Shares Under Option prior to the date the Optionee returns
to active employment with the Company, and vesting of any options under this
Agreement which would normally vest on a date during the absence shall be
postponed until the Optionee returns to active work at the end of the absence
(in which case, the date of return to active employment shall be a Vesting
Date). The provisions of this subsection (c) shall not affect any of Optionee's
rights in the event of his death, Disability, Retirement or in the event of a
Change of Control occurring during such an absence.

      (d) DEFERRAL OF EXERCISE OR DELIVERY OF SHARES. Notwithstanding any
provision in this Agreement to the contrary, if any law or regulation of any
governmental authority having jurisdiction in the matter requires the Company,
Committee, Optionee, or Representative to take any action or refrain from action
in connection with the exercise of any option under this Agreement or the
delivery of shares of Stock to the Optionee, or to delay such exercise or
delivery, then the exercise or delivery of such shares shall be deferred until
such action has been taken or such restriction on action has been removed.

4. RULES GOVERNING THE EXPIRATION DATE. The Expiration Date for options granted
to the Optionee under this Agreement shall be subject to the following rules:

      (a) TERMINATION OF EMPLOYMENT. If the Optionee voluntarily or
involuntarily terminates employment with the Company (for reasons other than
death, Change of Control, Retirement or Disability), the Expiration Date for
exercising any options under this Agreement

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which were vested as of his date of termination shall be the three month
anniversary of the date of such termination.

      (b) RETIREMENT. If the Optionee terminates employment with the Company on
his Retirement Date, the Expiration Date for exercising his vested options under
this Agreement shall be the third anniversary of his or her Retirement Date.

      (c) DISABILITY. If the Optionee terminates employment with the Company on
his Disability Retirement Date, the Expiration Date for exercising his vested
options under this Agreement shall be the third anniversary of his or her
Disability Retirement Date.

      (d) OPTIONEE'S DEATH. If the Optionee dies while actively employed by the
Company, the Expiration Date for exercising his vested options under this
Agreement shall be the first anniversary of the Optionee's death.

      (e) CHANGE OF CONTROL. The Expiration Date for all of the Optionee's
vested options shall be the tenth anniversary of the Grant Date if a Change of
Control takes place while the Optionee is actively employed by the Company.
Notwithstanding the foregoing, if the Optionee's employment is terminated for
Cause following a Change of Control, the Expiration Date for all of the
Optionee's vested options shall be the date of such termination.

      (f) MAXIMUM EXPIRATION DATE. Notwithstanding any provision in this Section
4 of the Agreement to the contrary, no option shall be exercisable on or after
the tenth anniversary of the Grant Date.

5. GENERAL PROVISIONS. The Optionee acknowledges that he has read, understands
and agrees with all of the provisions in this Agreement and the Plan, including
(but not limited to) the following:

      (a) AUTHORITY OF COMMITTEE. The Committee shall have all the authority set
forth in the Plan including, but not limited to, the authority to administer the
Agreement and the Plan; to make all determinations with respect to the
construction and application of the Agreement, the Plan, and the resolutions of
the Board of Directors establishing the Plan; to adopt and revise rules relating
to the Agreement and the Plan; and to make other determinations which it
believes are

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necessary or advisable for the administration of the Agreement and the Plan. Any
dispute or disagreement which arises under this Agreement or the Plan shall be
resolved by the Committee in its absolute discretion. Any such determination,
interpretation, resolution, or other action by the Committee shall be final,
binding and conclusive with respect to the Optionee and all other persons
affected thereby.

      (b) NOTICES. Any notice which is required or permitted under this
Agreement shall be in writing (unless otherwise specified in the Agreement or in
a writing from the Company to the Optionee), and delivered personally or by
mail, postage prepaid, addressed as follows: (i) if to the Company at 1411 Third
Street, Ste. A, Port Huron, Michigan 48060, Attention: Corporate Secretary, or
at such other address as the Company by notice to the Optionee may have
designated from time to time; (ii) if to the Optionee, at the address indicated
in the Optionee's then-current personnel records, or at such other address as
the Optionee by notice to the Company may have designated from time to time.
Such notice shall be deemed given upon receipt.

      (c) TAXATION. The Optionee shall be responsible for all applicable
withholding taxes and the employee share of FICA taxes with respect to
compensation income generated upon the exercise or surrender of his vested
options under this Agreement.

      (d) NONTRANSFERABILITY. This Agreement and the options granted to the
Optionee hereto shall be nontransferable and shall not be sold, hypothecated or
otherwise assigned or conveyed by the Optionee to any other person, except as
specifically permitted in this Agreement. No assignment or transfer of this
Agreement or the rights represented thereby, whether voluntary or involuntary,
or by operation of law or otherwise, shall vest in the assignee or transferee
any interest or right whatsoever, except as specifically permitted in this
Agreement. The Agreement shall terminate, and be of no force or effect,
immediately upon any attempt to assign or transfer the Agreement or any of the
options to which the Agreement applies.

      (e) DESIGNATION OF BENEFICIARY. The Optionee may designate a person or
persons to receive, in the event of his death, any rights to which he would be
entitled under this Agreement.

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Such a designation shall be filed with the Company in accordance with uniform
procedures specified by the Committee. The Optionee may change or revoke a
beneficiary designation at any time by filing a written statement of such change
or revocation with the Company in accordance with uniform procedures specified
by the Committee. No beneficiary designation or change of beneficiary
designation will be effective until notice thereof is received. If an Optionee
fails to designate a beneficiary or if the beneficiary predeceases the Optionee,
the beneficiary shall be the legal representative of the Optionee's estate. The
Optionee is not required to obtain spousal consent to designate someone other
than the spouse as beneficiary.

      (f) NO SHAREHOLDER RIGHTS. The Optionee shall have no rights as a
shareholder of the Company, and shall not be deemed to be a shareholder of the
Company for any purpose, as a result of the options granted to the Optionee
under this Agreement, until the date that shares of Stock have been issued or
transferred to the Optionee following the exercise of an option in accordance
with this Agreement. The Optionee shall not be entitled to any dividends or
other rights for which the record date is prior to the date of such issuance,
transfer, or receipt.

      (g) NOT AN EMPLOYMENT CONTRACT. This Agreement shall not be deemed to
limit or restrict the right of the Company to terminate the Optionee's
employment at any time, for any reason, with or without Cause, or to limit or
restrict the right of the Optionee to terminate his employment with the Company
at any time.

      (h) FORFEITURE PROVISIONS. This Award is subject to all of the forfeiture
conditions set forth in Section 10 of the Plan.

      (i) AMENDMENT OR TERMINATION. This Agreement may be amended or terminated
at any time by the mutual agreement and written consent of the Optionee and the
Committee, but only to the extent permitted under the Plan.

      (j) NOT CONSIDERED INCENTIVE STOCK OPTIONS. The options granted under this
Agreement do not constitute and shall not be construed to constitute "incentive
stock options" with the meaning of section 422 of the Internal Revenue Code of
1986, as amended.

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      (k) GOVERNING INSTRUMENT. This Agreement is subject to all terms and
conditions of the Plan and shall at all times be interpreted in a manner that is
consistent with the intent, purposes, and specific language of the Plan.

      (l) SEVERABILITY. If any provision of this Agreement should be held
illegal or invalid for any reason by the Committee or court of applicable
jurisdiction, such determination shall not affect the other provisions of this
Agreement, and it shall be construed as if such provision had never been
included herein.

      (m) HEADINGS/GENDER. Headings in this Agreement are for convenience only
and shall not be construed to be part of this Agreement. Any reference to the
masculine, feminine or neuter gender shall be a reference to other genders as
appropriate.

      (n) GOVERNING LAW. This Agreement shall be construed, and its provisions
enforced and administered, in accordance with the laws of the State of Michigan
and, where applicable, federal law.

6. DEFINITIONS. All capitalized terms shall have the meaning set forth in the
Plan or, if not defined in the Plan, shall be defined as set forth below.

      (a) CAUSE means any of the following: (i) the willful failure of Optionee
to perform satisfactorily the duties consistent with his title and position
reasonably required of him by the Board of Directors or supervising management
(other than by reason of incapacity due to physical or mental illness); (ii) the
commission by Optionee of a felony, or the perpetration by Optionee of a
dishonest act or common law fraud against the Company; or (iii) any other
willful act or omission (including without limitation the deliberate and willful
violation of any corporate policy or regulation) which could reasonably be
expected to expose the Company to civil liability under the law of the
applicable jurisdiction or causes or may reasonably be expected to cause
significant injury to the financial condition or business reputation of the
Company.

      (b) CHANGE OF CONTROL has the meanings specified in Section 9(c) of the
Plan.

      (c) COMPANY means SEMCO Energy, Inc., its successors and assigns, and any
other company or other entity, whether foreign or domestic, in which the Company
has or obtains,

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directly or indirectly, a proprietary interest of more than eighty percent (80%)
by reason of stock ownership or otherwise.

      (d) DISABILITY RETIREMENT DATE means the date of the Optionee's
termination of employment from the Company due to Disability. For purposes of
this Agreement, Disability means a "disability" as defined under the SEMCO
Energy, Inc. Long-Term Disability Plan (whether or not the Optionee is covered
under such plan).

      (e) EXERCISE AMOUNT means the sum of (a) the Option Price multiplied by
the number of vested options being exercised plus (b) an amount sufficient to
pay all applicable FICA and withholding taxes on the difference between the Fair
Market Value of Company Stock for which the vested options are being exercised
(determined as of the exercise date) and their Option Price, as calculated by
the Committee.

      (f) EXPIRATION DATE means the tenth anniversary of the Grant Date, unless
an earlier Expiration Date is established by operation of Section 4 of this
Agreement.

      (g) FAIR MARKET VALUE has the meaning specified in Section 2(n) of the
Plan.

      (h) GRANT DATE means the date set forth on the first page of this
Agreement, upon which the options described in this Agreement were granted to
the Optionee.

      (i) OPTION PRICE means the price per share set forth on the first page of
this Agreement.

      (j) OPTIONEE means the Eligible Person named on the first page of this
Agreement.

      (k) PLAN means the SEMCO Energy, Inc. 2004 Stock Award and Incentive
Plan), as adopted by the Board of Directors on March 12, 2004, and approved by
the Company's shareholders on May 24, 2004, and as amended from time to time.

      (l) REPRESENTATIVE means, in the event of the Optionee's Disability, his
duly authorized legal guardian or representative; or, in the event of the
Optionee's death, his estate, legal representative, or beneficiary as designated
pursuant to Section 5(e).

      (m) RETIREMENT DATE means the date of Optionee's termination of employment
from the Company on which Optionee is eligible to receive an immediate annuity
under the terms of

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the SEMCO Energy, Inc. Retirement Plan (or any successor tax-qualified
retirement plan maintained for salaried employees of the Company).

      (n) TOTAL SHARES UNDER OPTION means the number of options granted to the
Optionee as set forth on the first page of this Agreement.

      (o) VESTING DATE means any one of the dates upon which options granted to
the Optionee under this Agreement become exercisable in accordance with this
Agreement.

      IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized officers under its corporate seal, and the Optionee has
executed this Agreement, as of the day and year first above written.

                                            SEMCO ENERGY, INC.

                                            By: ________________________________

ATTEST:

________________________________
Corporate Secretary

                                            OPTIONEE

                                            ____________________________________
                                            Name: ______________________________

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