Shell Plc casts fresh doubt on B.C. LNG project due to 'funding&#3

[overthere]

http://business.financialpost.com/news/energy/royal-dutch-shell-plc-casts-fresh-doubt-on-b-c-lng-project-due-to-funding?__lsa=341f-105c

Royal Dutch Shell Plc. has cast doubts its liquefied natural gas export project in British Columbia will secure a final investment decision (FID) by the end of this year, further dashing the province ’s hopes of shipping LNG by 2020.

Shell’s LNG Canada in Kitimat is competing for funding dollars with two other company LNG projects, both in the United States, as well as with a chemicals plant in Pennsylvania, within the next 12 months, chief financial officer Simon Henry told investors during a conference call Wednesday.

“It’s highly unlikely that more than I would say two, maybe only one,… will actually go ahead in that timeframe,” Henry said. “…The chemicals plant is probably the first one because of the timing of certain commitments that are already in place.”

Is it really funding that prevents anybody from investing? Oversupply? Or is it the generally hostile overall investment environment in Canada?. The US has one LNG export plant running in the Gulf, two ready to build in Louisiana and one in Texas. They don't seem to be bothered much by funding issues or oversupply. So what can be the cause of no LNG plants for Canada?

[Peter F]

From the linked article:

Shell, which recently completed a transformative acquisition of its key LNG rival BG Group, is cutting spending to US$30 billion this year from US$35 billion in 2015, and has scrapped a number of projects over the past year.

Why shouldn't its BC LNG export project be put on hold? Hell, Shell doesn't think its worth it - why should other investors inside or outside Canada wring their hands with worry?

Edited May 6, 2016 by Peter F

[overthere]

From the linked article:

Why shouldn't its BC LNG export project be put on hold? Hell, Shell doesn't think its worth it - why should other investors inside or outside Canada wring their hands with worry?

Yet other projects elsewhere are proceeding.

Why would BC be singled out?

Can you think of a reason?

I can.

And Christy Clark(BC Premier) has belatedly come up with one too.

[Smallc]

Yet other projects elsewhere are proceeding.

Why would BC be singled out?

Can you think of a reason?

I can.

And Christy Clark(BC Premier) has belatedly come up with one too.

Because we all know that resource companies have failed to invest in Canada...oh wait.

The environment is sort of an important thing. I would hope that you'd agree.

[Peter F]

Can you think of a reason?

I can.

So can Shell. To repeat the linked article: "Shell, which recently completed a transformative acquisition of its key LNG rival BG Group, is cutting spending to US$30 billion this year from US$35 billion in 2015, and has scrapped a number of projects over the past year."

Is that not reason enough? Shell thinks so.

[overthere]

Because we all know that resource companies have failed to invest in Canada...oh wait.

The environment is sort of an important thing. I would hope that you'd agree.

The resource companies used to invest in Canada, but not now. Why would they welcome the level of formal hostility they get now?

The economy is kind of an important thing too, but I certainly would not expect you to agree.

[Smallc]

The resource companies used to invest in Canada, but not now.

It's not like the price has absolutely dropped off or anything. It isn't as if many of these projects have been under review long before Trudeau, which of course is what you're getting at.

The economy is kind of an important thing too, but I certainly would not expect you to agree.

Balance. That's what matters. Besides that, Canada's economy is far more than resources.

[overthere]

It's not like the price has absolutely dropped off or anything. It isn't as if many of these projects have been under review long before Trudeau, which of course is what you're getting at.

Balance. That's what matters. Besides that, Canada's economy is far more than resources.

Yes, the exhaustive review started long before Trudeau, and his every action since has been to delay, extend and ultimately halt investment and development. More proof of that is the recent appointment and composition of the(newly required) latest post-NEB panel of three people who will almost certainly be unanimously opposed. The resource companies are not stupid, they can clearly see they are simply not welcome in Canada now.

Of course, you can and will blow that off as meaningless.

I see it as a major, and pointless loss of jobs and export earnings for ideological reasons. Investment is very badly needed to sustain our standard of living and the lovely social contract that cannot be bought via debt indefinitely.

[Smallc]

Trudeau will get at least one pipeline built. Everything points in that direction. If you rush the process, it loses credibility. Harper lost credibility.

[-1=e^ipi]

Trudeau will get at least one pipeline built. Everything points in that direction.

So you really think that there is zero probability that Trudeau will pull an Obama and delay it for years until cancelling it?

[overthere]

Trudeau does not build pipelines or LNG facilities. Neither does Canada. There are a number of things that Trudeau could do to facilitate the investment of major money in this country to enable the builds. So far, he has done the exact opposite.

Oh, I get it, it is a religious experience. You have to have faith.

[Smallc]

Yes, a review is a religious experience. Like I said, the bubble must be a difficult place to live.

[overthere]

So you really think that there is zero probability that Trudeau will pull an Obama and delay it for years until cancelling it?

Oh, he does not have anything close to the personal courage required to stand in front of Canadians and confirm the purpose of what he is doing since elected on these files. He has to be a bit careful, he has at least four premiers now getting pretty pissed with him: NB, BC, AB and SK. Of course, none of them really matter from his perspective except perhaps BC

All it takes is one or two suppliers of the oil that would fill the pipelines to say: looks like they will never get built, see you later. Then Enbridge/Trans Canada, Kinder Morgan etc have no purpose. And after investing years and hundreds of millions in endlessly delayed approval processes, they will do what they have already begun. That is to move their pipeline capital elsewhere. Both Trans Canada and Enbridge have recently made multi billion dollar investments outside Canada, they can see how this is going to end here.

Latest move by Trudeau: appoint a panel to do yet another review after the extensive multiyear government mandated NEB review is done. All three of the appointees have backgrounds that would entirely preclude them having any kind of balanced approach.

[overthere]

Yes, a review is a religious experience. Like I said, the bubble must be a difficult place to live.

How many reviews and for how many decades do you need to see the third eye of Dear Leader, share The Vision? Is there any limit?

[Smallc]

How many reviews and for how many decades do you need to see the third eye of Dear Leader, share The Vision? Is there any limit?

There has been very little change to the Conservative review process - they've simply added consideration for GHGs. When you don't believe in AGW, I know it seems useless, but it's not.

[PIK]

Trudeau better make up his mind, he is in japan trying to sell NG to them.

[overthere]

Trudeau better make up his mind, he is in japan trying to sell NG to them.

I think it is much more likely he is there begging Honda and Toyota not to close their plants or reduce production. He will explain how diverse we are, which will make their business investment decisions so much easier.

Good luck selling gas to Japan, Australia has long ago comprehensively eaten our lunch there as a major supplier, and Qatar has too. The US is hard on that market too. We are not even close to being ready to export anything. By comparison, Australia is going to bring perhaps 6 LNG export terminals online in the next 4 years to serve their fat contracts in Asia.. Buttering their own bread is never a problem with the Aussies.

Oh, and there is that trifling matter that since we continue to dick around endlessly with out economic future, the prices for LNG have plummeted. Justin: sell low, buy high! http://www.japantimes.co.jp/news/2016/05/23/business/japan-pays-least-since-2005-for-lng-amid-price-slump/#.V0XdDt_2Zpp

[PIK]

World leaders must be shaking their heads. Going from Harper who knew his stuff to trudeau who has no clue.

[msj]

Oh, and there is that trifling matter that since we continue to dick around endlessly with out economic future, the prices for LNG have plummeted. Justin: sell low, buy high! http://www.japantimes.co.jp/news/2016/05/23/business/japan-pays-least-since-2005-for-lng-amid-price-slump/#.V0XdDt_2Zpp

Just so we understand you: are you saying that Trudeau, who has been in power since late last year, is somehow to blame for not being in a position to export our LNG?

That he is to blame for NG prices going down?

Not sure what your point is... other than casting blame to someone who has just recently been in a position to do something about it ... but not without help from provinces who like to dick around.

[overthere]

Just so we understand you: are you saying that Trudeau, who has been in power since late last year, is somehow to blame for not being in a position to export our LNG?

That he is to blame for NG prices going down?

Not sure what your point is... other than casting blame to someone who has just recently been in a position to do something about it ... but not without help from provinces who like to dick around.

He is doing his very best to make sure nothing ever gets approved, no doubt about it. His specific actions since taking office point only in that direction. For example, the NEB report approving KInder Morgan was not even released when Trudeau announced yet another layer of 'consultation' was required. The he appointed three people who appear to all be openly hostile to any resource development. There will now be a THIRD round of consultation with the very same indigenous groups that just got consulted for the last three years and had more than ample time and money to do just that. Both those actions related to the NEB directly undercut the authority of the federal'approval' process. You think that is an accident? I don't, it is most certainly and without question just the latest in a series. He also just specifically delayed the federal review of a major BC LNG plant, again. Try and keep up with current events.

Capital is portable, and that swooshing sound you here is corporations saying 'f**k it, BC and Canada just do not want our business. And they are correct.

[overthere]

World leaders must be shaking their heads. Going from Harper who knew his stuff to trudeau who has no clue.

They are laughing. Our loss is their gain.

[msj]

Hmm, didn't know the Transmountain pipeline was about NG.

Learn something new everyday!

[overthere]

Hmm, didn't know the Transmountain pipeline was about NG.

Learn something new everyday!

All part of the same stupid policies on energy exports.

I doubt your second sentence.

[msj]

All part of the same stupid policies on energy exports.

I doubt your second sentence.

I suppose the sarcasm either carried through too well or not at all.

Nice conflating of policies there though - completely useless to do that but partisans gotta partisan-take I suppose....

[Argus]

If you want to know why companies might be rethinking doing business in Canada, particularly in BC, you might want to read this.

It's Black talking about a case which has moved to the Supreme Court about natives opposing a ski resort in BC. It took ten years of environmental studies before the preliminary go-ahead could even be given to the developers, plus many additional years of planning and discussions with local natives, and accommodation and offers of jobs for them, and now they're in endless court battles with natives - natives who don't own the land, but live nearby, and who now claim the sacred grizzly bear spirit would be offended by a development - because one of their leaders had a 'vision'.

http://news.nationalpost.com/full-comment/conrad-black-this-isnt-religion-its-madness

Edited May 29, 2016 by Argus