BC Liberal`s LNG Bafflegab Bullshit(Inside the numbers)

 

 

Written by Grant G

 

Below is a release by the BC Liberal ministry of LNG propaganda, I`m about to shred their numbers one by one, but before I get there, this was released on the same day as Stats Canada revealed BC lost 10,400 jobs in the month of February, methinks this web was spun to deflect from the ongoing bad economic news emanating from British Columbia...Oh, and there was more, on this same day Christy Clark donned her same photo-op hardhat out in Port Moody at the Evergreen skytrain site, Global BC was ready with cameras in hand to blow Christy Clark`s Jobs Plan trumpet..

Maybe I`m the suspicious type, a big Evergreen skytrain photo-op, a big LNG Jobs numbers  propaganda press release by the ministry of natural gas(also known as Rich Coleman`s natural flatulent filled tent) all on the same day British Columbia was informed of another 10,000 plus lost jobs...

Before we get started please read the below press release very carefully..

 

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http://engage.gov.bc.ca/lnginbc/job-creation/

Job Creation

As the LNG industry develops, it will create jobs all over the Province.

 

 

In fact, corporate offices have already opened in the lower mainland and demand for labour is growing in northern B.C. The LNG industry will create thousands of jobs in the natural gas sector.

These jobs will include direct and indirect employment during the construction phase as well as long-term operations.

 

 

Based on a current forecast of 5 plants in operation by 2021:

 

 

• 21,600 jobs will be directly involved in the building of LNG export facilities and associated pipelines.—

• 41,900 jobs will be created in the industries that supply goods and services during the peak construction phase.—

• 2,400 permanent jobs are required to operate and maintain the plants and pipelines on an ongoing basis.

61,700 jobs are required to support LNG operations including workers required to drill, produce, process and transport the natural gas required to feed the export facilities.

In addition to these jobs, there will be thousands of spin-off opportunities created and supported as result of LNG. For example: When a welder earns income, the money spent on their cost of living is injected into the economy. By spending their wage on things like buying clothes, eating in restaurants or renovating a home, the welder supports the financial well-being of the community and indirect jobs for their neighbors.


Recently, the B.C. government released a Natural Gas Workforce Strategy and Action Plan in collaboration with industry and training authorities.
Our action plan outlines the employment demands expected from LNG as well as details on how government will prepare people for new jobs.


Skills and core industrial certification requirements, as well as new postsecondary programs, will be created to ensure British Columbians are trained for new, high paying jobs in the resource sector.


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Where to start, how about the beginning, based on 5 plants in operation by 2012.....

First off, we are 3 months plus into 2014 there still isn`t 1 final investment decision, to have 5 in operation by 2021 they all would have to be under construction by early 2015, at the latest..

21.600 jobs directly involved in building the plants and pipelines, that number is not to far off if 5 plants with pipelines were under construction concurrently, British Gas has this set of numbers for their proposed British Columbia proposed LNG project..

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"BG intends to build a facility on Ridley Island capable of producing 21 million tonnes of LNG a year. Called Prince Rupert LNG, it would be built overseas in modules and shipped to Prince Rupert for assembly.

 Even so, the plant would create 3,500 jobs during construction,

 250 permanent direct jobs and another 250 spinoff jobs.

 BG says it is planning to build it in two phases, beginning in 2016.
The first phase — two seven-million-tonne-a-year processing units, or trains — is to be completed by 2021" 
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I hope you are all following very closely, BG`s peak construction numbers are fairly close to the BC Liberal`s press release numbers, except for this...

In the above press release(not the British Gas plant proposal data) by the BC Liberals they say this..
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"41,900 jobs will be created in the industries that supply goods and services during the peak construction phase."

_____—

41,900 jobs supply to goods and services, yet British Gas is quite specific with their proposal, British Gas clearly states that...
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"BG intends to build a facility on Ridley Island capable of producing 21 million tonnes of LNG a year. Called Prince Rupert LNG, it would be built overseas in modules and shipped to Prince Rupert for assembly."


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British Gas states that their proposed BC LNG plant will be built overseas in modules and shipped to B.C.....That overseas country is no other than South Korea, one can only assume that the other proposals too will be built overseas in modular form and shipped to British Columbia where construction workers will assemble, like a jigsaw puzzle...So my question is, where do you get 41,900 jobs supplying GOODS and services?..Especially when the plants are being shipped to British Columbia from South Korea in modular form..?

 

And there is so much more, because according to the BC Liberal press release propaganda, ....

 

____________

 

"21,600 jobs will be directly involved in the building of LNG export facilities and associated pipelines.—

41,900 jobs will be created in the industries that supply goods and services during the peak construction phase.—

2,400 permanent jobs are required to operate and maintain the plants and pipelines on an ongoing basis.

61,700 jobs are required to support LNG operations including workers required to drill, produce, process and transport the natural gas required to feed the export facilities."

________-

Ok, let`s kick out the 21,600 jobs.....and let`s kick out 41,900 jobs as those are temporary construction jobs....And if we keep reading, according to the press release after construction with 5 LNG plants in operation 61,700 jobs are required to maintain gas supplies for the 2,400 full-time permanent LNG plant jobs?

Is this true?...Could it be, whose numbers do we believe, math doesn`t lie, BC Liberal cabinet ministers do lie, in particular Rich Coleman lies...Because according to Rich Coleman, Rich Coleman stated on February 22/2014.....

Rich Coleman on February 22/2014 made this outrageous statement while giving a 30 minute speech on LNG..

Read it carefully..

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"I get a kick out of some of the other folks out there saying: 'You're behind schedule.' "No we're not. We're actually right on the time frame that I established."

One thing that works in the government's favour is the scale of the enterprise. The values are so vast that even delivering a fraction of the potential could count as a win.

Coleman said: "They say: 'They can't all go ahead.' "I say: 'OK. Let's have three.' That's $100 billion. That's 100,000 jobs."

It's that comfort level that's giving him the kicks, and the amusement. snip..


http://www.canada.com/victoriatimescolonist/news/comment/story.html?id=9cc9a3fd-2f0b-4b77-b2e1-40ddae5a1039&k=33176
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Rich Coleman claimed 3 LNG plants would be $100 billion in investment and 100,000 jobs...That means that 5 LNG plants would be $166 billion in investment in British Columbia and 166,000 jobs..

Hmmm, I wonder who is lying, the BC Liberal press release or Rich Coleman?...They both are lying..

I mentioned math, pure unadulterated math...With modules being shipped to British Columbia and merely being assembled here there is no way those job numbers add up, and there is so much more..

About the only thing the BC Liberals got right is the amount of permanent plant workers in each LNG operation...British Gas confirms that, roughly 250 to 300 LNG plant workers with about 250 direct spinoff jobs...That adds up to about 2,500 permanent direct jobs in 5 LNG plants...

Math, a funny subject that strikes fear into most, but math doesn`t lie.....

These projects and revenue totals for the province were over 30 year time periods, lets peruse those numbers, all the numbers..

Currently the yearly LNG total sales to all countries from all the many LNG export operations is a gross...about $170 billion dollar yearly market(gross)....Remember that number, we`ll come back to it.

$166 billion dollars for the cost of building 5 LNG plants with associated pipelines, add in amortization costs to the build price and we are looking at least...$200 billion, probably closer to $250 billion dollars..

$250 billion dollars..build costs and amortization.

Christy Clark promised a $100 billion dollar prosperity fund...

Christy Clark promised debt elimination too...Currently standing at $70 billion..

Christy Clark also promised First Nations a share of revenue..Clark promised northern communities a revenue share.

Christy Clark promised crown debts paid off, bridge tolls removed and elimination of our provincial sales tax, like Alberta who has no provincial sales tax..

Christy Clark also promised hospital and school infrastructure money from LNG revenues...All told..

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$250 billion in build costs and amortization..

$100 billion prosperity fund.

$70 billion dollar BC debt.

Let`s make those other items $30 billion, and we will even forego a sales tax removal, (That would cost $5 to $6 billion per year, over 30 years that cost would be $180 billion alone)

We are at $420 billion dollars in costs and we haven`t sold any gas yet....Big number, it`s about to get a whole lot bigger because..

Let`s read what the BC Liberal press release had to say about jobs...

Christy Clark has claimed that these gas field jobs, LNG plant jobs and all LNG resource based jobs are big-time paying family supporting jobs, how much is a good resource LNG family paying job...How about ..

$100,000 per year per LNG job...That`s not big money, that`s a resource job in the LNG game with benefits included..

The BC Liberals in the top of this post press release claimed this many jobs were required to support the 5 operational LNG plants and the 2,400 permanent plant jobs..

_________

"61,700 jobs are required to support LNG operations including workers required to drill, produce, process and transport the natural gas required to feed the export facilities."

_________

Ok, 61,700 jobs required to support the 2,400 permanent plant jobs is a total of....

64,100 jobs required to run and feed gas to 5 operational LNG plants and if each of those jobs after benefits was a $100,000.00 per year cost job...

The payroll for 64,000 jobs that cost $100k per year, the payroll cost per year for those jobs is a staggering...

$6.4 billion dollars per year in wages.....

30 years of wages at $6.4 billion dollars per year, and for the sake of easy math we won`t have any wage increases for the entire 30 years of these LNG plant operations...Wages alone total..

A staggering $192 billion dollars in wages..
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$192 billion in wages after construction for 30 years.

$250 billion in build and amortization costs.

$100 billion prosperity fund.

$70 billion in debt elimination.

$30 billion for First Nations, northern communities, hospital and school infrastructure, crown corporation debt, bridge toll removals..(No sales tax elimination)

For a grand total of...

$642 billion dollars...

Let me spell this out, according to the BC Liberals, with 5 LNG plants, the operational costs and promised goodies to the electorate these LNG plants have to make a total of ..

$642 billion dollars in LNG profits over 30 years to break even...

Let me repeat that, these LNG plants would have to make $642 billion dollars in pure profit over 30 years to make not 1 dollar!..

And, those 61,700 jobs(drilling, feeding gas) required to support the 2,400 permanent LNG plant workers, those 61,700 workers are not individual contractors but employees for companies meaning...

Meaning those companies too need to make a PROFIT, not just make employee wages, as does the pipeline companies, everyone need to make profit not just pay employee wages, in other words..

Add another $50 billion minimum to the total cost outlay..Now we are at ..

$692 billion dollars in pure profit required before these companies and investors have made a single dollar..

Let`s make a giant leap of faith, let`s assume these LNG companies make 50% profit on everything they sell...

That means these 5 operational LNG plants would have to sell $1.364 Trillion dollars worth of LNG to pay their bills, and they still haven`t made a single dollar..

1/2 of $1.384 trillion dollars is.....$692 billion dollars..

So, in theory these 5 LNG plants to be profitable, this according to Rich Coleman and Christy Clark over 30 years would have to sell at least...

$2trillion ...probably $3trillion dollars worth of LNG over 30 years...

That means each operational LNG plant would have to sell $400 billion to $600 billion dollars worth of LNG, or $14 billion to $20 billion dollars worth each year, from each plant.....Remember, at present the entire yearly world LNG market is about $170 billion dollars....And there are dozens of LNG plants and many countries in the LNG game,  Australia, Qatar, Russia, Iran, Papua New Guinea, East Africa, USA, to name a few..

Oh, I almost forgot, Western Australia where all those LNG plants have been recently built, is western Autralia making any money, well, actually no, Western Australia is/has racked up $billions in new debt even with massive LNG plant investments..

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West Australian government unveils big-spending budget, admits debt is an issue

• by: ANDREW BURRELL

 

THE Barnett government faces the prospect of losing its prized AAA credit rating after it defied the end of the economic boom by unveiling a big-spending budget that will add $10 billion to Western Australia's debt pile over the next four years.
 

Western Australia's net debt is forecast to surge from $18.4 billion at June 30 this year to $28.4bn by 2017 after Treasurer Troy Buswell said the government would boost spending

http://www.theaustralian.com.au/national-affairs/state-politics/west-australian-government-unveils-big-spending-budget-admits-debt-is-an-issue/story-e6frgczx-1226693654210#
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If it takes 61,700 gas field employees to keep 2,400 LNG plant workers and the gas flowing to the LNG freezer trains, well....Math doesn`t lie, $8 billion in yearly wages alone, real funny stuff!

And British Columbia is going to garner 33% of the world market, ?...With 5 LNG plants, With Japan wanting lower prices, with massive new supplies coming online everywhere, with Japan restarting their nuclear plants, with China doing their own fracking and or getting piped gas directly from Russia, with methane hydrates...

BC has not one final investment decisions, Australia has 1/2 dozen LNG plants alone with more coming online over the next 3 years, with floating LNG coming online, with East African LNG plants coming online, with Russia increasing export capacity, with the USA converting one-time import regasification plants to export plants,  and we don`t even have a shovel in the ground..



And, let us not forget, LNG and shale gas is/was a Wallstreet hedge fund derivative, LNG companies are flipping leases, trading, swapping and trying to flog their phony assets to suckers, as they are born every minute and British Columbia is a province run by a Government of three card monty dealers,..


Check this out, LNG and shale gas plays is another Wallstreet Ponzi, it`s about the big Wallstreet banks and investment firms flogging mergers and acquisitions..

http://thetyee.ca/News/2013/02/20/Natural-Gas-Gluts/


Someone is zooming us British Columbians, remember what Rich Coleman said on February 22/2014.....?

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"I get a kick out of some of the other folks out there saying: 'You're behind schedule.' "No we're not. We're actually right on the time frame that I established."

One thing that works in the government's favour is the scale of the enterprise. The values are so vast that even delivering a fraction of the potential could count as a win.

Coleman said: "They say: 'They can't all go ahead.' "I say: 'OK. Let's have three.' That's $100 billion. That's 100,000 jobs."

It's that comfort level that's giving him the kicks, and the amusement. snip..


http://www.canada.com/victoriatimescolonist/news/comment/story.html?id=9cc9a3fd-2f0b-4b77-b2e1-40ddae5a1039&k=33176

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3 LNG plants 100,000 jobs? ....5 LNG plants using Coleman`s math..166,000 jobs...?

100,000 jobs at $100 k gross is $10 billion in wages, that would be $10 billion per year, or at 166,000 jobs...$16 billion per year in wages alone...$300 billion to $480 billion in wages over 30 years, all that money having to come in from gas sales, just to support 5 LNG plants? economists can spin the data anyway they like,  this industry can`t function on those numbers, support numbers, masses of promised workers, ...Where?....That press release talks about ...and I quote..


 "61,700 jobs are required to support LNG operations including workers required to drill, produce, process and transport the natural gas required to feed the export facilities"

Did you read that, ....bizarre, 61,000 drillers, the drillers are the producers, ....drillers punch in their holes, water is injected under pressure(with chemicals added) ..drillers blast the shale rock and cap the well, ....pipe the fracked gas to the main feed, .......Pipe the fracked gas by pipeline to the coast, there are no "transporters"...There are drillers, they drill and cap wells, back up crews connect to mains, these aren`t crews of hundreds of men..drilling crews are 12 men at most, are we to believe 2000 drilling gangs going full time, for 30 years, if true, god help us all, how much can a land take, that water..

What is written above, either employment numbers are cooked badly for spin purposes, because if government`s employment numbers are true neither this gas industry or our environment is sustainable, not with those numbers..

someone is zooming someone.

Can you say..

Christy Clark and Rich Coleman?

Anything can be made over to look good, this frozen gas game is a pig with lipstick, ..Anything can be made over to look better than it really is...Including the cover of this post..

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P.S.... I really think you need to listen to Max talk about LNG in the below video, he is correct..one more thing, the above math is in real simple form, one may nitpick with the numbers, this isn`t a technical article but one doesn`t need to be a rocket scientist to figure out that the massive sums of money required, massive amounts of energy required for each plant to freeze the gas, a $12 billion dollar publically funded Site C dam would have enough power for 1 LNG plant and about 1/3rd of another..
Meaning these plants are going to burn massive amounts of gas producing internal electricity, or we the taxpayers are going to surrender every spare drop of our domestic power grid and subsidize too, these behemoth power chugging LNG plants won`t pay even BC Hydro`s lowest industrial rate, .....They won`t pay for intermittent high-priced run of river power, despite the blathering from Paul Kariya and the IPP private raiders club..

Add in the $cost of the burnt gas these plants would use, add the cost of vast gobs of grid electricity to the above set of financial numbers and the amount of money needing to return to this operation is enormous, the amount of money and gas required to make this goblin be profitable as advertised is truly astronomical..

(The video below, you might have to rewind it to about the 3 minute mark)

The Straight Goods

Cheers Eyes Wide Open