Saturday, March 21, 2015

LNG in Howe Sound - Dr. Eoin Finn

Eoin (Owen) Finn B.Sc.,Ph.D., MBA, a 30 year resident of Bowyer Island, Howe Sound, retired KPMG consultant.



From Vancouver Observer


From the Spring 2014 edition of Rising Tide, a newsletter of Living Oceans:
We found it interesting to note how that same government reacted to a U.S. proposal for a tanker route passing through Canadian waters in Passamaquoddy Bay, New Brunswick. Downeast LNG is a proposed export terminal in Maine. Their preferred tanker route bypasses critical habitat for North Atlantic right whales and would see the tankers navigating a narrow channel with a bend. Sound familiar? But in New Brunswick, Conservative MP Greg Thompson leapt to the assistance of project opponents. Soon, the entire Cabinet was explaining Canada’s vehement opposition to the project.

Gary Doer, Canada’s ambassador to the U.S., stated, “Canada continues to have serious concerns with the proposal to construct an LNG terminal on the Maine side of Passamaquoddy Bay. These concerns relate to the environmental, navigational and safety risks as well as the adverse economic consequences arising from the passage of LNG tankers through Head Harbour Passage, New Brunswick, which the Government of Canada opposes.”

Maxime Bernier, Canada’s new minister of foreign affairs, assured a citizens’ group that “Canada is strongly opposed to the prospect of LNG supertankers navigating the treacherous waters that lead into Passamaquoddy Bay between Maine and New Brunswick.”

In 2006, Stephen Harper said, “… there are well-founded concerns about the construction and operation of LNG terminals in ecologically-sensitive areas like Passamaquoddy Bay.”

Japan Feb LNG spot price falls a quarter to $7.60/mmBtu, Reuters, March 10, 2015
...demand from other major buyers South Korea and China has disappointed, reflecting weak overall Asian demand.

Spot LNG contracted in February for delivery to Japan averaged $7.60 per million British thermal units (mmBtu), down from $10.20 per mmBtu a month earlier, the Ministry of Economy, Trade and Industry (METI) said.

Spot cargoes booked earlier and arriving last month averaged $10.70 per mmBtu, down 23 percent from $13.90 in January.

Asian spot liquefied natural gas prices LNG-AS for April delivery fell below $7 per mmBtu last month, trading at a discount to Europe's benchmark UK gas hub prices,
as ample stocks, a mild winter and slowing economic growth have dampened demand in parts of Asia.

Goldman Sachs forecast last week that Asian LNG prices would dip to $6.25 per mmBtu in the third quarter of 2015, before rising to $7.00 per mmBtu in 2016...
From a letter in the Bowen Island Undercurrent by Anton van Walraven:
...the people of BC will see very little benefit and most likely will be paying foreign investors to take BC’s LNG. In a nutshell, BC’s royalties on LNG are not paid on units of gas but rather on the net-profits of the LNG producer/exporter. In other words, if there is no profit, BC will get zero royalty income. Norway, on the other hand, claims royalties by the unit of North Sea oil. It now has a trillion dollar heritage fund. Compare this to Alberta. Like BC, it claims a tax on the net-profits and its heritage fund is… empty! On top of that, add the subsidies and tax breaks offered by the Provincial and Federal government and the balance is pushed right into the red.

...the price for LNG has plummeted. For BC, the projection is now that it will take up to 15 years, after the first project starts up, before we see any royalties coming in.

The foreign owners of Woodfibre LNG are in it to make profit... they won’t pay taxes until all their start-up costs have been absorbed. When profits are made, will they ever pay any taxes? Maybe, maybe not. The profits can always be booked to the parent company Woodfibre LNG Pte. Ltd. based in Singapore, which has very low taxes for LNG firms. And Canada has an agreement with Singapore not to double tax when a firm is already taxed in one of the states.

Taking this all in, you might wonder why Councilors [Alison] Morse and [Gary] Ander show support for the Woodfibre LNG project, when the economic benefits for BC and Canada will be non-existent. Their support becomes stranger when we consider the negative impacts on the environment of Howe Sound and the impact daily trips of LNG supertankers through Howe Sound will have on the local tourism economies and real estate values.

It leaves me wondering how long someone can remain loyal to an ideology that is so counterproductive to our economy, health, environment and quality of life.
Washington LNG Blast Spotlights Natural Gas Safety, Reuters, April 2014
An unexplained blast this week at a liquefied natural gas (LNG) facility in rural Washington state, which injured workers, forced an evacuation and raised alarm about a potentially large second explosion, could focus attention on the risk of storing massive gas supplies near population centers...

Early Monday, a “processing vessel” at the Williams facility near the small town of Plymouth, Washington, exploded, spraying chunks of shrapnel as heavy as 250 pounds as far as 300 yards, according to local emergency responders.

The flying debris pierced the double walls of a 134-foot LNG tank on site, causing leaks. Five workers were injured, and local responders warned that vapors from the leaks could trigger a more devastating, second explosion. A county fire department spokesman said authorities were concerned a second blast could level a 0.75 mile “lethal zone” around the plant.

Everyone within a two-mile radius of the site was evacuated, and a bomb-squad robot was deployed to snap photos of the damaged tank to avoid putting workers at further risk. Some who did approach were reportedly sickened by fumes...



Recommend this post

5 comments:

  1. So the proposed Woodfibre LNG terminal will provide less jobs (including spinoffs) than the BC Liberal spin department, pose huge environmental risks, result in increased hydro rates, and only after the proponents recoup their capital expenditures (fifteen years or so) will we garner very low royalties, if any.

    Maybe we should cancel Site C, and with part of the money we save pay Woodfibre LNG Pte. Ltd. to stay home. It would be a net benefit to the environment and the public purse.

    ReplyDelete
  2. How about including a chunk of that change to pay Christy Clark to stay home. "It would be a net benefit to the environment...... " It would also save those Bollywood extravaganzas, trips to China & India, etc.

    ReplyDelete
  3. Maybe we set a chunk of that change to pay Christy Clark to stay home. "It would be a net benefit...." Also save on those Bollywood extravaganzas, trips to China, India and all the associated costs.

    ReplyDelete
  4. Gross tonnage ("... a unitless index related to a ship's overall internal volume"): Queen of Surrey 6,969; LNG Akwa Ibom 115,993

    ReplyDelete
  5. When I practiced in downtown Vancouver I had a very nice office with a view of the north shore. Every once in a while I would spot a LNG barge being towed out by a tug. Had those tanks exploded they would have taken out most of the windows in those downtown offices, the glass shards shredding everyone inside. Having watched a fire at one of the gas barges I dreaded what could happen from a LNG barge explosion.

    ReplyDelete

COMMENTING

This is an archive only of items published before April 22, 2016. These and newer articles are available at:

https://in-sights.ca/

If you read an article at this blogger site, you can comment on it at the new site.

Note: Only a member of this blog may post a comment.