What would you do with a $trillion Dollars"
I think it`s time to go back in the time machine and have a look at the not too distant past
The date...November 3rd/2014...The place, the British Columbia Legislature,..I present you one of the most affective NDP MLAs....Norm Macdonald....(for the life of me, I don`t understand how BC`s mainstream media could ignore this fact filled ball-busting recital of what hyperbole bullshit Christy Clark and her team of scofflaws have fed the electorate....and this was 2 years ago when Norm Macdonald said this ON THE PUBLIC RECORD....Actually, I know exactly why Norm Macdonald has been ignored by legislative gang(reporters and columnists?........They only report or print government spin, quotes and inane blather....Hello Balderdash!
N. Macdonald: I rise to speak on Bill 6, the Liquefied Natural Gas Income Tax Act.
That was interesting. I'm not sure the minister actually read the bill if you're talking about the revenues that you still are trying to lay out in front of British Columbians. This bill is a year and a half late coming, and here it is. The reality is here before us to contrast with the frankly ridiculous rhetoric around LNG from this minister and from the Premier in particular, but really from all members — ridiculous rhetoric.
I would invite you to look at the bill and actually look at the numbers that we are talking about with this tax measure. The one thing that the B.C. Liberals needed to do in the so-called race for LNG was this bill. It's a year and a half late and a dollar short.
In fact, it's more than a dollar short. The bill — this is it. This is the 2013 B.C. Liberal campaign in the flesh, and it sure looks different than what B.C. Liberal members promised to British Columbians. It looks a lot different.
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The bill…. This is it. This is the 2013 B.C. Liberal campaign in the flesh, and it sure looks different than what B.C. Liberal members promised to British Columbians. It looks a lot different.
The B.C. Liberals ran on a promise. Before we get any further with this bill, let's just remember some of the things that were talked about: 100,000 jobs created by LNG, $1 trillion in economic activity. It ends the sales tax. It gets rid of $68 billion in debt. It creates a $100 billion prosperity fund, the first LNG plant by next year and 12 to 17 LNG plants.
That is completely, completely missing in this bill. This is the one bill that accomplishes that. The irony here is if I was to keep my campaign promise, I'd vote for this bill, and I do. This is exactly what I said we were likely to get. The sort of fiscal framework that is here is exactly what I said in my campaign and my colleagues said in their campaigns was likely going to happen.
It is the B.C. Liberal MLAs…. You were the ones who promised the $100 billion dollar prosperity fund. I looked for the Minister of Finance's promises on this. I could not find them. He is the one that is the most careful with what he said. Even in his speech here he didn't enter into the bluster of the minister of LNG, because he knows the reality. I would invite you to actually look at the numbers and see how ridiculous your campaign promises were, and understand that if you vote for this bill, you are breaking every one of those promises.
So read it. Read the bill and actually understand what you're voting for here. It is not my promises that are broken; it is your promises, and the Premier's promises, and the bluster of the minister of whatever — LNG, or whoever that was that was up in front of us — that was supposed to be giving us a somewhat sophisticated accounting of what this is.
I saw no sophistication. I saw no understanding of the complexity of this issue from that minister, which is disturbing. That's our best man on the job? Wow. That is a disturbing, disturbing concept for British Columbians.
You know, the B.C. Liberal candidates…. If you parroted the Premier's wild claims, then I am sure you can claim to be ill-informed. Fair enough. But if you weren't ill-informed, then you are not honest about the possibilities here. That's the reality. This bill confirms that clearly.
The thing is, I can actually vote for this and keep my promises. You can go, and you can look. They're on line — the debates we had, where the B.C. Liberal candidate was on and on about $100 billion this and no sales tax. I was going: "No. These are the actual possibilities that are available to us." That's what I see actually in this bill.
Look at some of these claims — 100,000 jobs claim. Members should read the Grant Thornton report. You should read it if you're serious about this job. The B.C. Liberals, the government, told Grant Thornton that they had to use certain assumptions. They said that you have to use the number of five LNG plants. Well, okay. Is there any basis for five rather than six or seven or three? No. It's an arbitrary number.
Then the B.C. Liberals said to Grant Thornton: "You have to use the number 2,400 as the number of jobs that would be provided by those five LNG plants and the pipelines needed to supply them." Did that number come from anywhere real? No. It was a made-up number.
Then the B.C. Liberals told Grant Thornton that they were required to use a multiplier of 30 for the indirect and induced jobs for each direct job. So that's the Grant Thornton…. Have a look at it and read it — a multiplier of 30. Just so you understand, a committee of the House of Representatives in the United States made similar reports. Their multiplier was 3.5. This is a credible group that instead of using a multiplier of 30, used a more realistic number of 3.5.
So the 100,000-person claim is completely not factual. It is not factual. You wouldn't have to look very hard to actually understand that. So if you are doing your job, have a look at that report and the Ernst and Young report as well. Look at the front, where they say, "Hey, all we're doing is taking numbers the B.C. Liberals gave us and doing the math. Don't blame us for everything else."
But what I can say to members
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have a look at that report and the Ernst and Young report as well. Look at the front, where they say: "Hey, all we're doing is taking numbers the B.C. Liberals gave us and doing the math. Don't blame us for anything else."
What I can say to members: "If you took your job seriously, you would actually have a look at that." B.C. Liberals say it's 30. U.S. House of Representatives say one-eighth of that amount is a multiplier. There's something completely dishonest about throwing around fake multipliers, fake numbers of LNG plants.
Let's just use common sense here. An operating LNG plant employs 120 people on average. It's like a pulp mill. In fact, Skookumchuck, which is an average-sized pulp mill, employs 290 employees in my riding. That is one LNG plant — 120. So when the minister stands up and asks us to believe that five of those change everything in British Columbia, in Canada, at what point do you say that's ridiculous and irresponsible for a minister to say that?
I think you would have said it a long time ago, right?
Let's go to the finance side and actually look at this bill. This tax bill imposes on an LNG plant, according to the Minister of Finance, as follows — and you can look on page 12 of the minister's briefing: "Six to eight years after the LNG plant is built and operating." This government promised 2015. We are nowhere near 2015 for an opening. So if one does open, then six to eight years after it is built and operating you get between $100 million and $125 million. That is the type of money that we're talking about with this bill, okay?
It sounds big to most people — I get it — until you understand that the annual operating budget of this province is — what? — $44 billion. As well, you have capital spending that varies year to year. We are talking about huge sums when you compare it to the tax that comes with this bill from an LNG plant — huge sums and a massive disparity. How does $125 million per year starting next decade get rid of the province's debt, which is $69 billion now, and it's growing at a record rate. In fact, for this Premier it has gone up, in her short term, $15 billion or $16 billion. The Premier.... On top of that there's another $100 billion in financial obligations.
These B.C. Liberals ran on the notion that this bill here would eliminate the debt; $125 million per LNG plant starting six to eight years after a plant is built and operating gets rid of $69 billion. Now, if there's any thinking person on that side that's listening to this, explain how that is going to work. You must know it's impossible. So if you vote for this bill, you are putting into place the reality that is at complete odds with what you ran for in the last election — complete odds. Not me. This is what I said approximately.... This is what was going to happen, right?
The provincial sales tax. Wow, the provincial sales tax. We're going to get rid of the provincial sales tax with this — $100 million to $125 million six to eight years from now, with an LNG plant giving you between $100 million and $125 million. Do the math on that; $6 billion per year comes in — provincial sales tax. Not only that, we're also going to get rid of the debt and contractual obligations. Okay.
These B.C. Liberals said this. They said $125 million per LNG plant collected six to eight years after they are up and operating will also lead to a $100 billion prosperity fund. The Premier said it, like two weeks ago, about the prosperity fund. Again, just do the math on it. We are going to take this $100 million to $125 million per LNG plant in six to eight years, and somehow you get rid of the debt. You get rid of the provincial sales tax. You get rid of any need to worry about money ever in the future because you have a $100 billion prosperity fund.
If B.C. Liberals were
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get rid of the provincial sales tax. You get rid of any need to worry about money ever in the future because you have a $100 billion prosperity fund. So if B.C. Liberals were honest, they would vote against this bill, because it doesn't come close to getting you there.
This was always dishonest, to me, for the B.C. Liberals to promise untold billions, and we ended up with a bill that gives us a relative pittance. The irony is that that works for me. This is what I said was the reality. This is the reality.
On page 4 of the minister's LNG income tax briefing documents, the B.C. Liberals try to explain how they got it all wrong. I would invite members to go and look at the briefing documents. They're there, page 4.
Now, what was not known years ago? What is the big surprise that we see on page 4, and how big a surprise was it to anybody who knew anything about the natural gas markets? None of these factors are not there as issues in world journals from five, six, seven years ago. It was simple, and I thank the library for doing it. I just asked them: "Could you go back five, six, seven years and send me articles from around the world on the LNG issue?" They did. They were fantastic about it.
What do you see? All the factors that apparently surprised the Minister of Finance are there in articles. They're not new. This was always a very fluid market. Pricing was all over the place. The factors that were laid out are not surprises, really. The $400 billion pipeline deal between China and Russia — it is regularly predicted. They're talking about how long it's taking to get to that deal. Now, the actual day it was announced — that was a bit of a surprise. But that they were working on that deal — no surprise at all.
Other central Asia natural gas plays. The pipelines to China. Turkmenistan is already China's biggest supplier of natural gas and plans to double exports to China by 2020. China's reserves are well known. That's not new. Australia, Qatar, East Africa, U.S. LNG activities — they were all well known. People here know that natural gas prices fell dramatically in North America over the past decade as new techniques increased North American natural gas supply. Our critic actually spoke about the topic, unlike the minister responsible for liquefied natural gas, who put no content towards the bill. There was a tremendous amount of content in what our critic said.
Henry Hub is the North American pricing tool. Asia uses the Japanese Crude Cocktail, too. It's a tool that was oil-based, and therefore, there were pricing differences between North America and Asia, which you could take advantage of if we could get our natural gas to Asia. As members here should know, to transport across the ocean on ships, it has to be condensed, so natural gas is liquefied by cooling it to minus 161. To build the liquefication plants, there is a need to invest billions, and it takes a fairly long time to get them up and going. There are pipelines as well.
The price differential between North America and Asia is the key. If prices in Asia get to around $10 per million Btu, then the economics do not work for the B.C. LNG industry. That's something the government can't control. It's just the reality that we likely face. Most agree that that's about the price point that's important.
For a while we were at $18 per million Btu in Asia, but that was always ephemeral. That was always something that we knew was moving. A spike in Chinese demand compounded by the temporary shutdowns of the Japanese nuclear program following the tsunami and the Fukushima problems — all of these were things that caused a spike in prices in Asia. But that pricing difference window, I think most would agree, has for the most part passed, and we are at the $10 per million Btu mark in Asia now or close to it.
None of that should be a surprise to anyone who was informed about these markets. Even a casual observer should know that. As far back as 2011, contracts into Asia based on Henry Hub pricing were taking place rather than JCC. It goes back as far as 2011.
The Premier on February 2013 told a conference that we would get $250 billion in tax
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on Henry Hub pricing was taking place rather than JCC. So it goes back as far as 2011.
The Premier, in February 2013, told the conference that we would get $250 billion in tax revenue from LNG in the decade ahead. At that conference.... It was not only that it would get rid of the sales tax; it would create a $100 billion prosperity fund. It was even cutting personal income tax and getting rid of the provincial debt. That was what the B.C. Liberals ran on.
This bill brings in $100 million to $125 million per year per LNG plant, six to eight years after it is built. That is the reality, and you cannot move past those numbers. You cannot get anywhere close to what the Premier continues to claim and, presumably, the LNG minister continues to claims and reality. These things never will fit together.
If you as the B.C. Liberal.... If you vote for this, then you are not getting half of what you promised. You're not getting a quarter. You are not getting one-thousandth of what you went to the doorstep and promised people if they would vote for you. That is the reality with this bill.
So there you are. You are literally taking one-thousandth of what you promised in the last election. It's like thud, thud. This is it. Well, okay.
You know, with Bre-X — if you're from my generation, you remember Bre-X — it all fell apart when the reality became clear. So an election's like a sales pitch, right? It's all words, all hope. It's really exciting, especially when the sales pitch includes salting the claims, which is an awful lot what took place there. But in the end with Bre-X, there was no gold, and here there is no end to sales tax, there is no $100 billion prosperity fund, and there is no end to — what is it? — $168 billion if you combine the debt with the contractual obligations. You know, there's no gold. That's the reality.
It is just a bill that gets, if it's successful, and we.... You hope it's successful. It's a marginal amount of money.
Here's the problem that I have with the initiative. There's something wrong, first, that as a governing body so much of our discussion, so much of our conversation here is built around complete fantasy. We should be talking about things that are real. The only way that we move forward in a meaningful way is if the debate is intelligent and honest. This debate, especially when the Premier launches into flights of fantasy, is anything but. We need to have honest, honest debate.
You need to not just focus on something that really is not going to produce the results that are claimed. It should be one of many things that this government pursues. If you look at the list of missed opportunities, it's disturbing what you see.
With forestry, where I was the critic, there were so many things that we could be doing in forestry that would be good for the economy. I talked about an LNG plant being equal to a pulp plant. It's in some cases equal to a normal mill. In Nanaimo shutting down that mill — that's 100 jobs that we had. All we had to do was try to find a way to make that work.
What about Harmac? I see the member from Nanaimo.... Understand with Harmac that there is a need to keep that integrated industry moving, and it wouldn't take much. There was a government that created that integrated industry, and there should be a government that protects it. Those are real jobs that can be protected.
There are jobs in reforestation that we don't take advantage of. There are jobs getting accurate inventory. There are jobs available with new products, all exciting, that should not just be forgotten about because we're chasing something that, while it offers some opportunity, is nowhere near what this government claims it is.
There are opportunities in forestry, and I've had the pleasure to become the critic for mining. It was an unfortunate time to step in, in many ways, with Mount Polley, but as a critic for mining, it's a wonderful opportunity to go and see what's going on in the province. There are some exciting things. I've been fortunate. I mean, Imperial, Teck, Nyrstar, Hillsborough — they've been tremendous about showing me what they have.
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a critic for mining, it's a wonderful opportunity to go and see what's going on in the province. There's some exciting things. I've been fortunate. Imperial, Teck, Nyrstar, Hillsborough: they've been tremendous about showing me what they have.
What are the things that they're looking for? Well, they want permitting to come faster. They want, actually, compliance, inspections — these things — to be done properly. But the government doesn't do them properly. The government hasn't done them properly. Instead, there is this focus on a fantasy of five, six, 12…. I don't even know what the LNG minister said was the possibility, but it's detached from reality. I do know that. I think anybody who follows this knows that it's detached from reality.
What about other opportunities with LNG? What about other opportunities? Because there are some. That natural gas is there; the price is low. There is the opportunity in Revelstoke, for instance, to replace propane with LNG. There are other communities. For instance, while we're sending natural gas to China, my communities — Invermere, Canal Flats, Golden — don't have natural gas. Now, the economics just possibly aren't there, but there are possibilities. Maybe that is a good way to build the economy here locally.
But for that to take place, there would have to be a venue for intelligent debate on some of these issues. I would say that this is one of the biggest failures for this government, that its walk of fantasy of talking about numbers that are completely unreal means that this House cannot have an honest debate — let's be frank — about skills training, an honest debate about forest policy, about mining. All of those are impossible because the government has to stick to this fantasy of $100 billion prosperity funds and no sales tax.
The minister has said we'd be the envy of all jurisdictions if we didn't have a sales tax. Well, Alberta doesn't have a sales tax — right? There are other jurisdictions that don't have MSP. In fact, I think all of them don't have MSP. There are lots of other jurisdictions that are doing just fine. I bet a debate on potash in Saskatchewan or a debate on oil policy in Alberta would not be this devoid of fact from the leading minister and the leader of the government. I cannot imagine that there's any other jurisdiction that has such ridiculous statements made by people who should know better.
Let's just come to the essence of this. The essence of it is, as a bill…. It's on the public record. You can actually…. I'm sure you've got 200 or 300 people that watch to see if we say anything stupid so you can retweet it. Actually, I would invite those public servants that B.C. Liberals have in such great numbers to actually go…. You can go on websites where they still have the debates that we had from the 2013 election. What you will see is me and other members of this House basically saying that LNG is something that has potential. It has potential but the challenges are real. The challenges are real, and one simply has to work towards this, dare I say, one practical step at a time. You just need to do that work — and fair enough.
I guess, as an election promise, that's a tough sell, but that is the reality. That's the reality that this bill represents.
So, Members, if you're serious about your job, look at the numbers. Look at the pages that are there in front of you in the Minister of Finance's own presentation. Look on page 4, on page 12. Six to eight years after one LNG plant is built, you get $100 million to $125 million. How does that get you to getting rid of the debt of $69 billion? How does that get rid of the sales tax of $6.7 billion per year? How does that give you a $100 billion prosperity fund? All of that really is, frankly, ridiculous.
So here we are. This bill will proceed. I think the essence of it is really in the detail.
I will say a couple things about the Minister of Finance. First off, as I said, I did look for him making those outlandish quotes, and they may be there. I couldn't find them, so it seems that he is a bit more wedded to reality than
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First off, as I said, I did look for him making those outlandish quotes, and they may be there. I couldn't find them. It seems that he is a bit more wedded to reality than the Premier, but okay. That's one thing. I didn't hear it in his speech. As well, I think that, given that, he's a bit more straightforward in terms of the reality than others.
We have an opportunity. It is an opportunity that we need to take advantage of but not to the exclusion of all others. As I said, for this bill, it pretty well matches what I thought would happen. For B.C. Liberals, with this, it is the end of any chance that you are going to come close to your election promises.
I just don't think that matters to you at all, frankly, but let's say that it did. You might want to read this. You might want to ask a few tough questions to the people that were telling you to talk about $100 billion prosperity funds, no sales tax, getting rid of the debt. I mean, all of that was something that's simply never going to happen. With that, here we are. I look forward to the work that will be done in committee stage by our critic.
The other thing I'd like to say is I do know and I'd like to recognize that the Minister of Finance did set up a number of opportunities for members to be informed on this bill. I think that that needs to be acknowledged. It should happen as a matter of course. It doesn't always. In this case I think that that's important to acknowledge as well.With that I take my place, and I look forward to the debate as we go on here
And in other LNG news, guess what LNG Canada is saying about Shell`s proposed LNG plant...on how much taxation they will pay British Columbia...Shell Canada will pay B.C. "$94 million dollars per year" during construction and a whopping $15 million dollars per year once in operation....At that rate Brtish Columbia could have a 1000 LNG plants and still never come close to the BC Liberal`s outlandish election promises...Grant G)"Though those taxes will fall to $15 million annually once in operation, according to LNG Canada"
read the details here
($15 million per year, let`s see, 10 years at $15 million is $150 million....30 years $450 million...MSP premiums, a tax no other province has brings in $2 billion per year.....Yea..BC Liberals couldn`t run a peanut stand..!
As written here for the last 3 years, the BC Liberals bullshitted the electorate...There will be no debt retirement, no prosperity fund, no sales tax elimination, no 100,000 jobs, all bullshit, all con, aided and abetted by the VANCOUVER SUN, GLOBAL tv, CTV AND CKNW, we will be lucky if this LNG industry doesn`t bankrupt public accounts and poison our air....Grant G..)
Thanks for that Norm MacDonald.
Here we folks....We have returned from the time machine.....phew...That was a wild ride
And where are we today, January 9th/2016....No export terminals operating..No FIDs..No shovels in the ground.....Norm Macdonald mentioned Japan will soon restart their nuclear plants..they have been restarted, Japan as an LNG market is kaput...
Norm Macdonald also mentioned in his November 3/2014 debate what the price for LNG was in Japan..It was $10 per MMBTUs...
Norm Macdonald stated the fact that Petronas couldn`t make a profit at $10 dollars...Hmmm...,,,Just what is the lastest price for LNG in Asia, as in January 2016?
Well...If Petronas can`t make a return on investment with a $10 price...I wonder how they will fare with these prices....Courtesy of Reuters ...
GLOBAL LNG-Prices slip on weak winter demand, global glut of supplies
- Limited LNG demand seen from China, Argentina
- Standard Life to vote against Shell's takeover of BG Group
The price of Asian spot cargoes for February delivery was pegged at $6.50 per million British thermal units (mmBtu), down from $6.90 at the end of last year. Traders said prices for March were even lower, with one trader saying prices for summer months have fallen below $5.00.
"LNG has been falling off a cliff the last few weeks," one trader said.
A wave of LNG set to hit the market from new projects in the U.S. and Australia, along with falling oil prices, kept sentiment bearish despite some fresh demand from China, which purchased some cargoes to meet demand driven by colder weather, and Argentina's tender to buy nine cargoes for January to March delivery.
Oil prices plunged to 12-year lows on Thursday after China allowed its yuan currency to slip, sending stock markets tumbling globally.
Amid a global supply glut of LNG, U.S.-based Cheniere Energy is set to load its first cargo next week, the first U.S. export of LNG, as domestic drilling booms.
Also on the supply side, the Australia Pacific LNG (APLNG) project delayed its first commercial cargo, racking up costs for China's Sinopec Corp, which has had a tanker waiting to load for more than two weeks.
Traders said the cause of the delay was not clear.
Royal Dutch Shell's $49 billion acquisition of BG Group, creating the world's largest LNG shipper, is facing resistance from Shell shareholders with Standard Life saying it will vote against the acquisition. (Reporting by Sarah McFarlane;
Christy Clark and her gang of grifters might want to rethink Site C Dam...I have a sinking feeling British Columbia is about to get shut out of the LNG industry(which is a good thing)....But we`ll be stuck with a $15 billion dollar plus bill for Site C....
"Food for thought"
The Straight Goods
Cheers Eyes Wide Open