LNG moving ahead or not

[maryjane48]

Because you don't understand basic economics. You have no clue.

actually its really simple, do not sell for the fast fix , when a proper plan can create long term economic growth .you make canada sound like a addict waiting for its next fix

[hobbyguy]

It is important to realize that BC is a high cost environment for potential LNG players. It follows that we won't get a huge tax off the top.

What we will get is a ton of jobs, and an improvement to our world's atmosphere. Every one of those well paid workers will contribute taxes, buy houses, drive cars, go to casinos, buy beer etc. etc. Don't you want those folks to be able to do that? Or should we sit on our hands and do exactly nothing? Which of course, pays exactly - nothing.

[Atomoa]

The BC Liberals did not run on "some construction jobs" and the green byproduct of using LNG. They ran on massive tax revenue from such projects, which have been since halved.

Trickle down jobs is a carrot that cannot be got and not a good plan for BCs long term future . Jobs to pay raised MSP fees with?

Why doesn't BC develop the resources ourselves (since we are absorbing start up costs) We keep all the profits, plus people will have jobs. Every report out there says Alberta *bleep* their boom away in the last 10+ years and I see no reason to jump on that bandwagon.

[bob vernon]

Jobs? Petronas is doing the engineering plans for the plant at the coast back home in Indonesia and Malaya. And they want to do the engineering work for the pipeline across the province back home. And they want to bring in their workers to build the plant and to operate it, and pay Indonesian scaled wages. And now that the price of natural gas has fallen, they want the drop to be made up by the BC government dropping the royalties and taxes to almost nothing. Sounds like a good deal? And the commercials continue to play on TV every night.

[hobbyguy]

I have a feeling that Petronas is not going to be an "end" player. There are too many other players with better proposals. And I don't think Petronas has the skill set to negotiate with First Nations and other stakeholders. Certainly if I were premier, lol, I wouldn't take Petronas seriously.

The other thing that needs to be put into perspective is: what is the long term price of natural gas likely to be?

The IMF 2020 forecast is 4.10 NA, 16.7 LNG
The Economist 2020 forecast is 5.20 NA, 13.0 LNG

The most pessimistic price forecast is around $10 for LNG. http://oilprice.com/Energy/Natural-Gas/Oil-Prices-May-Recover-But-Not-LNG.html coupled with about $3.30 for NA gas.

The problem is that this type of investment works over a 20 to 30 year investment recovery. We are only looking at the short term out to 2020. Even at that, given that BC has such a short route to the largest markets, the forecast price spreads still seem to be attracting investment.

Oil prices seem to be inexorably unpredictable. How long will the Saudis play their game? Who knows? But I doubt it will be for more than a couple of years at the outside. From what I gather, LNG in Asia is roughly linked to 10% of the oil price, but not directly. That's the energy value equation for power producers. However, other factors such as China's desire to get a handle on air pollution, will be factors. The true costs of oil, bitumen, and coal are much higher when those objectives are factored in.

But don't let today's uncertainty be misguiding. When WAC Bennett was madly building dams, there were many critics that said it would never pay off, the capacity was not needed, and it was a pie in the sky effort. Hmmm...the critics look pretty foolish now.

LNG development isn't a sure bet. But it offers a way forward (with risks) not only for BC but for Alberta, Sask, and Canada. It may not turn out to be a great thing in short run, but long term?

[Atomoa]

http://business.financialpost.com/news/ ... =4e56-4b73

It is highly unlikely the government of British Columbia will realize its goal of having three LNG plants up and running on the West Coast by 2020, says a new report from Moody’s.

The report released Tuesday also said the majority of the 18 liquefied natural gas projects proposed for construction in B.C. will be nixed as a result of the collapse in oil prices — which affects the price of new contracts for LNG shipments — and a coming glut of LNG production from places such as Australia.

Poof, it's gone.

Even after halved tax revenue projections. Christy took you all for a ride.

[Muzza]

But I thought Moodys was paid by the government to give positive reviews!

Which is it? Can't have it both ways!

[The Green Barbarian]

Poof, it's gone.

Even after halved tax revenue projections. Christy took you all for a ride.

LOL - and what a ride it was. Too bad we didn't vote for those other guys I guess, the ones who just wanted to kill all economic development. What an idiotic platform that was.

[The Green Barbarian]

But I thought Moodys was paid by the government to give positive reviews!

Which is it? Can't have it both ways!

What do you mean? Hypocrisy knows no bounds with the liberal leftists here.

[Atomoa]

But I thought Moodys was paid by the government to give positive reviews!

Which is it? Can't have it both ways!

I have no idea what you are referring to, even after poking around keywords.

The article I posted was published in the Financial Post, if you are referring some sort of media bias there (with Moodys?) I made sure to link one of the many news articles from a known more-to-the-business-sentiment source.

LNG was always just smoke and mirrors. We halved the revenue projections (the actual benefit from doing it all), and still no.

Now it's just bombed out.

[The Green Barbarian]

LNG was always just smoke and mirrors.

LOL - yes and your expert opinion on this was very welcome, given your years of experience in this field.

We halved the revenue projections (the actual benefit from doing it all), and still no.

Who is "we"?

Now it's just bombed out.

Really? Has it?

[hobbyguy]

If you bought the "pot of gold" rhetoric about LNG during the campaign, well, I have a bridge I can sell you cheap. 1/2 hr of research on the internet at the time quickly dispelled that election "schtick". Never was going to pay our debts and put us all on easy street. If it sounds too good to be true...it is.

That said, there is still opportunity in LNG for BC. The current "crashed" price is still triple the North American price. And I suspect that there is some money, but not a pile, to be made at $7+ differential.

As this article points out, http://www.caseyresearch.com/articles/russia-and-chinas-natural-gas-deals-are-a-death-knell-for-canadas-lng-ambit the key is whether or not Henry Hub prices stay below $5.00 - and as pointed out in two of three forecasts I previously referenced, that looks to be the case.

Add in this: does China, or anyone else, want to have Putin's Russia as their only, or even primary supplier of natural gas?

And Exxon doesn't rely on outside sources, they do their own forecasting. Their public forecasts are VERY bullish on natural gas...

So I don't buy that LNG is a dead duck for BC, but I can see slower an more cautious development. 2020? Yup. Out the window.

[Muzza]

I have no idea what you are referring to, even after poking around keywords.

I guess you missed all the fun when we were informed that Moodys provides positive reviews for the BC government because the government pays Moodys to do so.

Interesting that those that were saying that Moodys was a puppet of the government did not dispute what you quoted.

[The Green Barbarian]

If you bought the "pot of gold" rhetoric about LNG during the campaign, well, I have a bridge I can sell you cheap. .

I don't know if anyone bought the story, they just would rather here a party who wants our votes to tell us how they want to do all they can to promote economic activity, provided world markets stay stable, rather than a sad-sack bozo tell us how badly he wants to kill all economic activity.

Toner says the NDP has solid grassroots supporters but the party has 1960s ideas and is run like it’s still in the 1990s.

YUP!

[The Green Barbarian]

I hope this is good news, in that I hope it is a step in the right direction in everyone working together to build infrastructure, create jobs, and treating the First Nations with the respect and dignity that they deserve. I am very happy when I read stories like these.

The company planning to build a 900-kilometre natural gas pipeline across northern B.C. has signed a benefit agreement with the Kitselas First Nation.

TransCanada announced the deal, when signed, will provide financial and other benefits related to the Prince Rupert Gas Transmission project.

Project president Dean Patry says the agreement is an important milestone and reflects his firm's commitment to engage with First Nations.

Kitselas Chief Joe Bevan says it gives his members economic benefits and employment training and also ensures environmental concerns have been adequately addressed.

TransCanada has signed similar agreements with the Nisga'a and Gitanyow First Nations.

The pipeline, which has yet to receive regulator approval, would deliver natural gas from near Hudson's Hope in northeastern B.C. to the proposed Pacific Northwest LNG facility at Lelu Island, off the coast near Prince Rupert.

http://www.castanet.net/edition/news-st ... htm#138322