Monday, March 21, 2016

Petronas in Prince Rupert, Boulevard of Broken Dreams


Prices of spot LNG for April delivery to Asia averaged $4.46 per MMBtu, according to latest Platts Japan/Korea Marker data for month-ahead delivery.

At $4.46/MMBtu, the April JKM was 38.7 percent below prices for the same delivery month in 2015.

Platts adds in its report that the latest marker for April delivery is also at the lowest monthly average level seen since July 2009, when the monthly average for August-delivered cargoes was $4.23/MMBtu.

Sentiment for April and further out in May continued to remain bearish due to expectations of extra supplies from both new and recently commissioned projects in the United States and Australia, as well as additional volumes from the Angola LNG project starting in the second quarter of 2016.

The JKM had begun the trading month at $4.7/MMBtu, before sliding to an intra-month low of $4.25/MMBtu in the first half of the month. Expectations of oversupply from the projects coming online weighed on the market sentiment, Platts said.

However, the downward pressure on prices was short-lived, as demand for April cargoes emerged at the same time from several buyers looking to quickly fill their April positions. Buy tenders from Argentina, PTT, SK, Posco, GSPC, Gail, and IOC for prompt April cargoes reversed the downward trend in prices. The Platts JKM rebounded back up to $4.60/MMBtu by March 11.

Max Gostelow of Platts said “While there are still valid concerns that 2016 will be an oversupplied market for most of the year, it’s evident that if buyers all adopt the same attitude and all wait for prices to bottom out before entering the market to buy cargoes, then we could definitely see more volatility in the markets like what has happened in early March.”

He added, however, that the price recovery has stalled as the market expects sellers who had bid unsuccessfully into Argentina’s 15-cargo tender to make those volumes available to the spot market.

“We are also noticing that the Qataris are growing increasingly competitive on price due to their long position, and offering very good price for volumes delivered to their (Long)term buyers,” Gostelow said.

The price of fuel oil, a possible competing fuel, decreased 53.6 percent year over year, while thermal coal was down 24.8 percent from the same month in 2015.


How does Woodfibre LNG or Petronas make financial returns with these prices...Longterm LNG contracts are being inked for less money than the cost of getting the gas out of the ground...Then you have to add-on the cost of pipelines hundreds of miles long, and the cost of liquefying the gas and then transporting it across the Pacific Ocean....

Canadian taxpayers will have to pay $billions to the proponent for inflated lng terminal build costs, with the lion's share of the build cost occurring in South Korea or China(not money spent in Canada)

The current world LNG glut will not end until 2025 or later, perhaps never if major energy companies decide to have multiple LNG terminals all coming online at the same time(mid 2024-2025)...

Here in British Columbia the BC Liberal government is hell-bent on spending probably $15 billion dollars on Site C dam to power up a money losing industry...

Christy Clark and the BC Liberal government are prepared to sacrifice one of Canada's few remaining salmon bearing super rivers...The Skeena River..

With LNG longterm prices in the tank, ...Site C dam($15 BILLION DOLLARS, WITH NO BUSINESS CASE PRESENTED, NO BUSINESS CASE TO JUSTIFY THE COST OR NEED) ...$12 billion for Petronas's terminal in Prince Rupert to be paid by the Canadian taxpayer...

$27 billion dollars Petronas must return in tax revenue to British Columbia and Canada just to get back to square one, and that's not counting the loss of wild salmon, or the loss of Prince Rupert tourism and fishing jobs...

That's not counting all the gas drilling credits accrued...

With low LNG prices for the foreseeable future .....How does Petronas find any money to pay the province any tax revenue?...

Qatar has jumped the market and guaranteed themselves longterm market-share at prices that make B.C. gas/LNG a money loser..

Companies, corporations that make no money pay no taxes, in-fact corporations that lose money write the losses off against any future profits...

I understand that gas drillers and rig workers in Northeast British Columbia are desperate for work, I understand they're demanding approvals by the federal Government to ensure their economic future...Unfortunately those oil and gas workers are prepared to sacrifice fishers and First Nation food sources and thousands  of salmon related jobs in other jurisdictions..

Jobs come, jobs go, we used to have 50,000 more forestry workers, raw log exports and massive high-speed mills have brought an end to those jobs...We once had thousands of commercial fishing boats and a vibrant fishery in B.C...That industry is a mere shadow of its former self..

We once built hardware and manufactured near everything we needed in Canada and the USA...Those jobs were shipped out to Mexico and China...Those jobs aren't coming back..

The corporation and corporate mindset only cares about profit and finding ways to avoid paying taxes..

Petronas PNW LNG and Woodfibre LNG wouldn't pay any monies to Canada or British Columbia for at least a decade, and that was when prices were above $15 dollars per MM BTU,s .....

 Renewable energy investment is soaring, Asia, and Japan in particular are embracing both nuclear power and renewable power..

It would be cheaper in the long-run to just send Northeast B.C. a $billion dollars per year for the next 27 years and have the north re-work their economy...

Lastly, if Petronas wants to go-ahead and build an LNG terminal it must find a new location..

It would be bad enough to frack the hell out of the north, waste all that water, pollute ground water, destroy caribou migration routes, cause earthquakes, all to add 30% to British Columbia's total GHG emissions making impossible to meet mandated by provincial law GHG reduction targets...To do all that, to never ever see the money subsidized to Petronas returned to taxpayers....To do all that and wipe out a Salmon super river, destroy a food source and cost tourism, fishing jobs is pure madness..

Written by Grant G


PETALING JAYA, March 21 — For the sake of protecting the earth, aboriginal Canadians turned down a whopping C$1.15 billion (RM3.56 billion) offer from Petronas that was seeking their support for a pipeline which they believed would harm a salmon river.

UK paper The Guardian reported yesterday Lax Kw’alaams First Nation hereditary chief Yahaan as saying that he believed his impoverished community might have voted to approve the liquified natural gas (LNG) project when the Malaysian state oil giant made the offer last year, but every single member of the indigenous group had rejected it.

Opportunities like that don’t come to your door every day. “But I give my people credit for taking that bold step. They showed their love and their passion for the land and water. No amount of money can compare to the richness of the river and what it gives us,”

Yahaan was quoted saying by the paper. Petronas is planning to build a multi-billion ringgit LNG export terminal at the mouth of Skeena, Canada’s second-longest salmon river, an area which lies within the Lax Kw’alaams First Nation’s traditional grounds, to ship LNG out of British Colombia. The Guardian reported that the location of the proposed Petronas project lies directly at an area where hundreds of millions of young salmon fish travel to annually before maturing, also noting that Skeena’s abundant fish population is needed by the First Nations aboriginal groups, the local wildlife and the region’s economy.

After the government of Canada’s province British Columbia gave its nod to Petronas for the project despite the Lax Kw’alaams’ rejection, Yahaan and his community members have since last summer been turning the oil firm’s workers away from sensitive areas at the river. Yahaan said the Canadian police escorting workers from Petronas have made verbal threats against his community’s boat patrols, noting:

They said they were watching us from land, air, and water. A police sergeant told me, ‘we could have ripped anyone out of those boats, but we didn’t want to make it seem like we were protecting the corporations.’

The Guardian said the aboriginal group’s rejection of the LNG plant was not merely about wild salmon, but about defending the indigenous worldview of “taking care with the land so that it can take care of people”, rather than supporting a fossil fuel economy with short-term jobs. Yahaan’s community has been getting increasing backing from others, with a few aboriginal groups, local Canadian groups and opposition politicians this January signing the Lelu Declaration meant to call for protection of the area from development. The opposition by Yahaan’s community is seen as putting pressure on Canadian prime minister Justin Trudeau, whose Liberal government had pledged to better protect the environment.

On Saturday, Petronas’ three-year wait for a permit to build the LNG terminal encountered further delay, after the Canadian government agreed to give its federal environmental assessment agency three more months to complete its study of the project’s impact. Yesterday, news wire agency Reuters reported that the Canadian Environmental Assessment Agency had needed more information from those behind the project for its report initially due on March 22, with the data required to determine if the proposed Petronas facility is

likely to cause significant adverse environmental effects”.

 .Petronas, which has seen its profits cut by a drop in crude oil prices globally, will also have to face the prospect of lower gas prices — which are now a quarter of the peak levels in 2014. -

See more at:


We have been betrayed by our elected leader

First Nation leadership repudiates BC Minister Coleman’s misleading statement of First Nation support for PNW LNG project

For Immediate Release
First Nations leaders have rejected BC Minister of Natural Gas Development Rich Coleman’s recent comments that the BC Government has the full support of First Nations impacted by the Petronas LNG project proposed for Lelu Island.
Faced with a further three month delay mandated by Federal Environment Minister McKenna, BC government officials flew to Ottawa earlier this week in a desperate attempt to convince the Federal government to ignore the clear commitments Prime Minister Trudeau made to combat climate change, reduction of green house gas emissions, make decisions informed by credible science, and rebuild the fractured relationship with First Nations. In a misleading Facebook post referring to the Ottawa trip, Coleman stated that the project “has the backing of local communities and conditional support of First Nations along the entire natural gas pipeline route and at the terminal site.”
Coleman’s comment drew immediate criticism from local and regional First Nation leaders in BC.
“Our community voted unanimously to reject Petronas’s proposed LNG project on Lelu Island, inclusive of the $1 Billion attached offer.  Clearly, the Hereditary Chiefs are the proper title holders to all parts of our territory such as Lelu Island.  In this regard, Band Councils do not have any jurisdictional authority.  Our Mayor, John Helin, never held a community-wide meeting to secure a proper political mandate to write the highly questionable letter to CEAA which purported to offer qualified conditional support for the LNG project on Lelu Island.  We have been betrayed by our elected leader. ”
– Hereditary Chief Yahaan (Donald Wesley), of the Gitwilgyoots Tribe of the Lax Kw’alaams
“First Nations leaders from the entire Skeena river are standing together in opposition to this project. Upriver First Nations have been side-lined in the environmental assessment of this project all along, and we are standing firm against it. Over 130 of the most respected Canadian and International scientists said last week that this project poses grave risk to our wild salmon, and endorsed the independent science that was ignored in the CEAA process. We cannot allow this project to happen as it is proposed.”
– Chief Glen Williams, President of the Gitanyow Hereditary Chiefs Office
“We do not support the PNW LNG project, nor have we been properly consulted by the BC government, which seems more intent on ramming this project through than respecting the First Nations, our hereditary leadership and the health of the Skeena salmon we all depend on.  Once again First Nations are being forced to take action because the government refuses to obey the laws of the land. We are salmon people and if we don’t defend Flora Bank, there will be no protection for our salmon. The salmon is who we are, and without them we lose our identity and our future.”
– Chief Na’Moks (John Ridsdale), Office of the Wet’suwet’en Hereditary Chiefs2048
“The entire world, including Petronas and its international investors, the Malaysian Government, the BC Government, and Prime Minister Trudeau’s Liberal Government, are aware of the deeply entrenched, extensive and broad Indigenous opposition to the proposed PNW LNG project.  These well briefed and extensively informed parties can no longer pretend that this is not a significant factor in deciding if the project goes ahead, in addition to the massive detrimental impacts to the environment, critically delicate salmon sustaining habitat and the undeniable fizzling market demand for LNG.”
– Grand Chief Stewart Phillip, President of the Union of BC Indian Chiefs

The Straight Goods

Cheers Eyes Wide Open


John's aghast said...

Hi Grant. I agree that the Liberals are morally corrupt, deranged individuals and the LNG cartels must be smoking something funny, but what is the relationship between MMBtus, mtpas and bcms? I realize they are all LNG measures, but how do they relate?

Hugh said...

Using power from BC Hydro instead of natural gas in the liquefying process, Woodfibre is supposedly 'clean'. Just means more LNG can be shipped and burned.

BC Hydro is not supposed to use Burrard Thermal, because it emits CO2. What happens to LNG after being shipped 7,000 km across the Pacific to its destination? It gets burned!

Shutting down Burrard Thermal justifies more IPP power purchases for BC Hydro - how convenient for the IPP industry folks, who apparently wrote that policy!

Burning BC natural gas in Burrard Thermal would eliminate the CO2 emissions resulting from LNG transport on the 7,000 km ocean voyage.

Grant G said...

@John Aghast...I'll do a little research and get back to you...


John's aghast said...

If PETRONAS is so insistent on losing their shirt, why don't they locate somewhere other than the mouth of the Skeena? If Steelhead can visualize piping the NG to Vancouver Island why doesn't PETRONAS pipe it to Haida Gwai and avoid the dangerous inside passage? Just rhetorical questions - I don't expect an answer.

Hugh said...

"But the (2016 Canadian Federal) budget leaves in place the existing accelerated capital cost allowance for liquefied natural gas facilities. Companies can write off 30 per cent of the cost of equipment and 10 per cent of the cost of buildings. Instead of phasing that out, the budget allows it to live out its life until it expires in 2025."

Anonymous said...

Christy, Carole, you listening, watching?

e.a.f. said...

Why the B.C. lieberals keep going on about LNG is beyond me,. As the reports all declare, there isn't any money there, prices are low, product available everywhere and anywhere.

Now as to Site C. I don't think its about the electricity. I believe its about the water. Once Site C is built, the water will built up behind that dam and its going to be a lot. So how about, the dam is then sold and with it the water behind it.

No water company would be permitted to build a dam of the size of Site C and flood that much of B.C. but a provincial government which builds dams, not much of a problem.

My prediction, they either plan to use the water for fracking, but more likely the dam and its water will be sold and exported to California and other drought striken areas. it will sell for more than oil or LNG. Christy will use the proceeds of the sale to buy the election in 2021.

I do expect the B.C. Lieberals to win in 2017, because if Christy doesn't look like a winner, they'll run Carole Taylor and she'll defeat the NDP in a heart beat. One the NDP isn't ready for an election and 2. if Taylor is heading the B.C. Lieberals, people will vote for her. If Christy is still the head of the B.C. Lieberals, a lot of their voters will stay home and the NDP will win just by getting their vote out.

there could be a snap election, the B.C. Lieberals are running about the same number of ads the HarperCons did in the run up to the federal election and they are similar in content. Christy also hired a lot of Harper's "little shits in short pants"

Bill said...

March 23, 2016 3:27 am

Woodside shelves $40bn Browse LNG project
Jennifer Thompson in Hong Kong and Jamie Smyth in Cairns

Woodside Petroleum on Wednesday disclosed it had shelved plans to develop the US$40bn Browse liquefied natural gas project, the latest ...

The full article can be found at:

Grant G said...

Thanks EAF....I believe there will be an early election call....Yea, Bill, ..I read about Browse project being cancelled...Australia can't sell all their present LNG output..And they aren't making any money..

Petronas....They can't make money selling LNG..They can make money by hook and by crook..Their $11 billion dollar terminal will magically mushroom to $40 billion in cost...Taxpayers pay the inflated by triple build costs...

That's what happened in Australia when the Government allowed accelerated build cost writeoffs....

Kill the Skeena river salmon...once the salmon are gone..Bitumen tankers aplenty..

Anywho...Petronas will be asked to move locations..lawsuits will follow...Trudeau's big test is coming quickly

e.a.f. said...

If LNG isn't going to happen and I see nothing which indicates it is going to and its not just your blog which is giving me that idea, Christy may call a snap election. the longer it drags out there is no LNG, the less she is able to say, its coming any day, because "any day" has passed by a couple of years and some months.

Also, if there are more scandals on the way, it might be best to call an election and try to out run the scandals, like it have an election before those scandals hit the fan and some reporter from outside the province does an article or such, just like the CBC did with the water on Vancouver Island.

Anonymous said...
What do you think they're doing in the Peace Region?

Anonymous said...

Grant, please make sure you have all your safeguards for your blog in place. I am sure you have heard Laila's blog being attacked and taken down. Please secure to the highest standard.

We have to make sure bloggers such as you, Norm, Laila, Rafe and others are aware. Norm reported it on his.

Anonymous said...

Hugh said...

Major LNG exporter Australia's debt is huge and growing rapidly:

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