Petronas LNG in Prince Rupert, Happening or Not?

OK, well I’ll assume you agree with the points that I made.

What’s wrong with investors, by the way? Are you one of those anti-capitalists?

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ok here we go again to someone that has a crystal ball and knows what the price of LNG will be over a 20 year period, first did your crystal ball and all those anylasts predict oil to be so cheap? if so go buy a lottery ticket, there is my sarcasm for the day.

here are facts late last year Petronas said yes to FID if they get CEA approval, they have stated in interviews no less that they are looking at long term prices the fall in short term prices do not bother them for they have built in customers, they are called their partners in the project. second when they borrow money they borrow in US funds so 12billion in US funds now is about 16 billion in Canadiain dollars, granted a good portion of that will be spent in either china or india to build the parts, third they have all the supply they need for they own Progress energy and they are spending 2 billion a year drilling and caping the natural gas wells, you don’t do that if you are not going to build, fourth they already gave the contract to Betchel, how do I know that talked to a couple of managers when they left in December, you don’t award contracts if you are not going to build,

so what is your evidence? the same anylasts that said prices will go through the roof are now saying prices are going to drop? they get paid to make predictions nothing more and in a few more months they will change their minds again. I trust the company before them.

Show us proof of what you are saying, where is Petronas saying no?

oh and as for the price of oil with Saudi Arabia having a predicted deficit of over 50 billion they are going to have to cut back on oil production to make prices rise again

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Yea I know…Check this out Stglider

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"Additionally, Petronet has avoided paying the US$1.5 billion penalty for taking less LNG than it contracted for 2015, but under the new agreement, it will have to take and pay for all of the volumes it has not taken in 2015 during the remaining term of the 25-year SPA.

Petronet also agreed to buy additional 1 mtpa of LNG from RasGas for further sale to Indian Oil, Bharat Petroleum, GAIL and Gujarat State Petroleum, with the delivery starting in 2016."


Indian Oil Corp…Hmmmm…That is one of Petronass PNW lng equity partners...And that is PER ANNUM....Starting in 2016..Gee whiz, its 2016 is it not?..Looks like Indian Oil Corp has secured supply…

Cheers

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@Grant_G

Are we throwing out random internet links? Here’s one for you:

“India’s imports of liquefied natural gas (LNG) are set to more than double over the next five years to 24 million tonnes per annum by 2020”

Makes your 1mtpa look rather insignificant, does it not?

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If anybody wants to put money on whether this is going to happen or not, I’m willing to be the middle-man :smile: if Paddy Power won’t take your bet.

Or you can buy futures contracts (or short them).

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Well, …You might like this.


Iran-Pakistan-India Gas Pipeline (IPI)

  • Location Iran-Pakistan-India - IR *
  • Investment 1,500,000,000 USD *
  • Completion 12/15/2018 *
  • Scope Iran-Pakistan-India (IPI) pipeline project (also called Peace Pipeline) was aimed at constructing a 1,620-mile (2700 km) pipeline from Iran’s South Pars fields in the Persian Gulf to Pakistan’s major cities of Karachi and Multan and then further to Delhi, India. Because of Iran is the most geographically convenient supplier of gas to both countries; Iran is offering to cover 60 percent of the construction costs of the pipeline.*

*The total length of 2700 km project would run 1100 km in Iran and 1000 km to Pakistan and in case of agreement with India it will continue 600 km in Indian Territory. This project is expected to greatly benefit India and Pakistan, which do not have sufficient natural gas to meet their rapidly increasing domestic demand for energy. *

A land-based pipeline would be four times cheaper than any other option, even after taking into account transit fee payments to Pakistan. Pakistan could earn about $200-$500 million annually in transit fees from the pipeline and also would be able to purchase natural gas from the pipeline.

The pipeline can carry 110 million cubic meters of gas a day. 50Mln cm meets domestic needs of Iran and the remaining 60Mln cm will go to Pakistan. Iran will initially transfer 30 million cubic meters of gas per day to Pakistan, but will eventually increase the gas transfer to 60 million cubic meters per day.

http://www.gulfoilandgas.com/webpro1/projects/3dreport.asp?id=100730


Like I said…And they said…

A land-based pipeline would be four times cheaper than any other option, even after taking into account transit fee payments to Pakistan. Pakistan could earn about $200-$500 million annually in transit fees from the pipeline and also would be able to purchase natural gas from the pipeline.

Pipeline direct gas…And Russia/Turmenistan is building a gas pipeline to China…And to Japan…Google it!

Cheers Eyes Wide Open

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I loved your link…It■s an article from a report by Petronet…A LNG company, pumping up their own bullshit…

And, from your link…And I love this!..


The finding is part of a just-released report called ‘India Infrastructure: India’s LNG Import Boom Is Credit Positive for GAIL, PLL’

*BS Reporter | New Delhi *

May 6, 2015 Last Updated at 20:35 IST


No one put their name to the business quote article…except this…

**BS Reporter | New Delhi ***

May 6, 2015 Last Updated at 20:35 IST

Guess we know what the BS stands for!

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Nice to see HTMF is alive and well

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I’ll put 1.50 on the fact that we won’t get LNG for a while …with China’s economy in question and oil dropping below 37.00 …I don’t see it happening soon.

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Actually it references a report from Moody’s. If you’re not familiar with them, they are one of the two main ratings agencies that assign ratings to credit instruments traded all over the world. Their reports are read eagerly by investors, traders, and anyone with half a brain in the financial industry.

A short trip to Google would have found you the source of the article.
https://www.moodys.com/research/Moodys-GAIL-and-Petronet-to-benefit-the-most-from-surge--PR_324537

If you’ve never heard of Moodys then I guess you know very little about the financial industry. Any remaining credibility… gone.

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it is funny ppl that don’t know the structure of Petronas in Prince Rupert are trying to say why it won’t go ahead,

here are their partners JAPEX, Sinopec/Huadian, Indian Oil and PetroleumBRUNEI, now read this carefully when Lelu is up and running their partners are required to buy from their plant the percentage of their ownership, if Indian Oil owns 10% of the plant, make sure you read this part, They have to buy 10% of the production. and the same applies to the others no matter what other contracts they sign. oh and petronas will still make money, see if you can follow this now, because they own 100% of progress energy which is where the plant is going to buy their natural gas from, so if progress gets $3 per thousand cubic feet, and then sell it to their partners for whatever the market is for LNG going to Asia, Petronas still makes a profit thanks to Progress Energy. easy to understand

The only thing that will prevent it not going ahead is the CEA, not the market or what you or some analyst say or think, a Government Bureaucrat will decide, they say yes it goes ahead, they say no it is dead

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Yup. Our forum is as feisty as ever. :slight_smile:

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Well, the CBC is a little late…The Straight Goods, always ahead of the curve.

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Listen to this man, hes on the ground in BCs Northeast, he`s in the Natural gas/LNG business…

Here is one quote from him…

"2015 has been the worst year for natural gas in a decade"

Turn on your ears Investor

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No one is disputing that its been the worst year for natural gas in a decade. But spot prices are only one of many factors that will go into the decision. To think otherwise is very naive indeed.

I’m reposting a few of the things that you forgot in your previous ‘analysis’…

  1. Petronas has already spent a ton of money on this project. Those are largely sunk costs that they won’t get back. Petronas won’t be considering them in their final decision.
  2. You’re also not factoring in the dramatic reduction in costs thanks to:
    a) the drop in the loonie
    b) the implosion of the oil industry
    Both of these mean that Canadian labour and resources are on sale right now. It will never be cheaper than it is now to build an LNG plant in Canada.
  3. They are looking longer term. No one believes that WTI oil will be trading this low in 5 years, and natural gas will certainly be higher too. Focusing on spot prices
  4. You’re probably underestimating the value of stability. The Asians will happily pay a little extra to diversify their energy supplies away from Russia, the Middle East, etc.

Are u sure they will pay a little extra!???

You’re probably underestimating the value of stability. The Asians will happily pay a little extra to diversify their energy supplies away from Russia, the Middle East, etc.

I think you’re misunderstanding the word ‘diversify’. Of course the Asian countries will continue to buy natural gas from Russia etc. But to rely 100% on a potentially risky source like that would be foolhardy. That’s why China, Japan and other nations have been working to diversify their supplies over the past decade. Specifically, that means they want gas from countries like the US, Australia, and yes, Canada.

You’re making the same mistake as Grant_G. By posting a link showing that Asians are buying some LNG from elsewhere, you prove nothing. The fact is that they have a vast and growing demand for natural gas. They won’t be satisfying that demand from a single source.

here is another reason why Petronas owns Progress Energy a natural gas producer which I have stated over and over and they don’t seem to reply to it, even Nexen was bought out by CNOOC and wants to build on Digby, why are they buying these natural gas companies if they don’t not want to export the gas, after all there is a surplus of natural gas on the closed north american market, they are buying the companies to export to their own countries. now the ones without a natural gas company and have to buy their gas from the open market to export they might be in trouble of being built and are probably getting an license to export so they can sell that license down the road

First off, I will admit to knowing pretty much nothing about the LNG industry and its financial outlook except for what little I can glean from news reports (as unreliable as they often are).

However, as an online poker player, I am fascinated by the psychology of this discussion and the surety of some of the posters. In poker, the cards are random, but I at least have control over what I do with them. I can analyze my hand, consider the board, the other players’ bets etc. and then, all facts considered, decide whether to hold them or fold them… And then I can punch myself in the face or pat myself on the back or scream at the poker gods depending on the outcome. Sometimes I know for certain that my hand is a winner; sometimes there is an excellent chance, sometimes it is a coin flip, sometimes I know I am hooped and sometimes something outrageously unlikely happens on the river ruining the best laid plans.

But at the end of the day I can look at the hand I see whether I was right, wrong, or just plain unlucky with the result.

None of that seems to apply here. Two groups, presumably looking at the same set of facts, are coming up with completing different opinions which isn’t necessarily unusual but the surety of their conclusions seems to be. Now we are not talking about personal viewpoints like whether Trudeau or Harper should be Prime Minister or whether or not LNG is a good thing for the community/environment. We all come from different backgrounds, philosophies etc that will result in differences of opinions.

But here we are talking about a future event that none of us control. I don’t think I am buying a new car this year. My current car is only seven years old and the expenses are still just regular maintenance yet I am less sure about what my car buying plans are than Grant G or Jabber are about the future of Petronas.

So my question for Grant G, if this were a poker game, and Jabber went all-in that Petronas would be building on Lelu before - let’s say - election day 2017, would you call that bet. And Jabber would you call the bet if Grant went all-in that there would be no construction before that date?

And more specifically for Grant G, is your prediction coloured by your dislike of the entire LNG boondoggle that the Liberals used to win the 2013 election. I think it safe to say that the LNG industry promised by Clark is not going to happen. We will not have the trillions and trillions and trillions of dollars from multiple projects. However does that automatically negate one or two projects like the one here.

And Grant G, just because you are not local and I feel I can poke you a bit more than some of the locals, is your prediction about Lelu as strong as your prediction of the May 2013 election.

Anyway, despite the best efforts from all posters I am no further ahead on whether or not I think Petronas will build or not but I do thank you for providing some insight into the psychology of predictions.