Sunday, October 12, 2014

Christy Clark's No Pro at Playing High Stakes Poker with LNG Giants

Premier Christy Clark and LNG billions at stake - what's to worry?  BC government photo 
Liquified Natural Gas multinationals gamble that marks from BC are ready to lose their money at the table - at taxpayer expense.

Bill Tieleman’s 24 Hours Vancouver / The Tyee column

Tuesday October 7, 2014

By Bill Tieleman

In poker, good players win and poor players lose."
- Lou Krieger, poker player and author
Imagine being a lousy poker player facing some of the world’s sharpest aces and you see the odds that the B.C. Liberals will lose big money to get giant liquefied natural gas companies to invest here.
The only consolation for the government is that taxpayers will pay for the LNG players’ winnings.
This week the B.C. Legislature resumes sitting to table legislation setting the taxes on LNG exports and the environmental standards that will have to be met by the companies considering building extremely expensive plants to process exports to Asia.
And the B.C. Liberals are already losing at your expense, as expert LNG card players see a mark at the table with more money than skill.
Premier Christy Clark is desperate for a deal, having bet everything in last year's provincial election on her ability to create an LNG nirvana in B.C., with a $100 billion windfall and 100,000 new jobs promised to voters.  
Card sharks like the CEO of Malaysia's Petronas -- Shamsul Abbas -- played the province like a sucker last month, threatening publicly he was "ready to call off" its planned $11 billion Prince Rupert LNG plant because of the "lack of appropriate incentives."
"The project remains uncertain and I doubt we will be able to make a positive (final investment decision) by year-end," said the master player.
And Monday he was back at it, warning that unless B.C. lowered taxes, Petronas would delay the "marginal" LNG plant by 10 to 15 years!
"In our last portfolio review exercise, the current project economics appeared marginal," Shamsul said. "Missing this date will have the impact of having to defer our investments until the next LNG marketing window, anticipated in 10-15 years."
Stuck at the table
Can you feel the money leaving your wallet now?
That's because the B.C. Liberals quickly backtracked from earlier statements that there would be a seven per cent tax on LNG net income after capital costs are recovered to now saying it would only be "up to" seven per cent.
Finance Minister Mike de Jong says there "won't be any surprises" in the tax -- and that's likely true, since the only surprise would be if it remained at seven per cent.
Clark says she is "very confident that we are going to conclude that negotiation successfully."
So am I -- very confident that we are going to give up billions of dollars because Clark simply cannot afford to walk away from the table, especially after Apache announced it was giving up on B.C. and ending its equal partnership with Chevron for a $15 billion Kitimat LNG plant, leaving the project in doubt.
And LNG Minister Rich Coleman says B.C. hit "a sweet spot" with its taxation plans.
"We got back from the industry that the numbers we hit made sense," Coleman said last week.
Oh, I bet they made sense, since every tax point is worth billions to either B.C. or the LNG companies.
Who's laughing?
After Petronas first upped its ante by threatening to leave B.C., Coleman tried to keep a poker face.
"We'll probably laugh about this when it's all over," he said in response. 
Actually, the last laugh will go to Petronas and the other LNG companies when they get exactly what they want from the B.C. Liberals -- and then chuckle all the way to the bank.

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13 comments:

Anonymous said...

When will the taxation benefits come to the province after capital costs are recovered by Petronas? Wasn't it years, if not a decade, away? How will MSP & Hydro coffers be filled now? Think we all know. Time to move to Brad Wall country.

Hugh said...

Exporting LNG doesn't seem economically viable, when you consider:

1. the cost of fracking

2. the cost to pump the gas across BC

3. the cost to liquefy the gas into LNG

4. the cost to ship the LNG 7,000 km across the Pacific Ocean.

Anonymous said...

This LNG scam is just the latest in a decade long con-game of Get Rich Quick schemes by the BC Liberals.

BC Hydro, the P3s, the Olympics, the Hydrogen Highway, BC Ferries and so on and so on.

If you remove all these economic distractions from the equation you have a BC economy supported on BC Liberal and media generated snake-oil.

What it means for regular, honest tax-paying working people . . . is that we live in a province that is broke.

Forget all this PNG generated media-crap about Hollywood North, what we really are is DETROIT NORTH!

The GREAT SATAN

Anonymous said...

"This LNG scam is just the latest in a decade long con-game of Get Rich Quick schemes by the BC Liberals.

BC Hydro, the P3s, the Olympics, the Hydrogen Highway, BC Ferries and so on and so on."

and how is that different from the con games played by the NDP when they were in government, as in Carrier Lumber, Skeena Cellulose,
The FastCats..

The NDP came out with some schemes that cost the taxpayer money.

Anonymous said...

"Think we all know. Time to move to Brad Wall country."

You're free to leave.

Whem are you going? And take some of the wacky Left wing contributors to The Tyee with you. You'd be doing BC a great favour.

scotty on denman said...

I don't think Christy is particularly worried about fulfilling the entire preposterousness of her LNG whopperism. I think she'd be satisfied with ANY development at this point. Her real confidence is in being able to boost anything, to spin the baton in front of any parade. Plainly, as her election campaign showed, she's not all that concerned with realistic prospects---she happily drove those LNG numbers to laughable heights, and she was rewarded with a win neither pundit nor partisan anticipated. Her real problem now is not in making good on unabashed hyperbole, but, rather, the prospect of having to square off with a capable opponent, instead of the the one who effectively handed her the election with his astounding pusillanimity, galling disbelief from both her supporters and rivals alike--- the NDP almost appeared a co-conspiritor in the whole dreadful affair.

Just like most BC Liberal supporters understand and accept with a knowing wink Christy's "Five Conditions", a necessary ruse to expedite a win, born out of a healthy respect for BC's cross-partisan antipathy toward the Northern Gateway pipeline, most BC Liberals recognized Christy's over-the-top LNG hyperbole for what it was---as she's showed time and again, promises aren't for keeping, they're for hawking---so they hardly expect her to achieve what was always unrealistic. It's never been about truth or honesty: the spectacle of the Princess Warrior holding the glittering World Wide Wresting belt high above her head, festooned with the scalps of her rivals, is so central to her phenomenon, it has to be staged, if needs be, at any cost, as it was in Kelowna when the loss of her own seat could not provide the essential opportunity.

It's so bizarre, even BC Liberals, including the ones who weren't too scared to seek incumbency before Christy's surprising victory, continue to worry. That's why they've kept her under wraps ever since, and, only with the greatest (and obvious) reluctance, trotted her out for some insincere sympathy for the victims of the Mount Polley disaster, and, similarly, we haven't seen much of her since the earth-shaking William (Tsilhqot'in) SCoC decision---except more of the same rote insincerity (what she styled as an "historic" engagement with First Nations, typically rhetorical and hollow.) She hangs her Premiership on parades and boosterism; it's somebody else's job to get muddy in the trenches.

For the moment, for as long as it lasts, LNG is the substance, etherial as it is, which must be kneaded , and be seen to be kneaded, in public view; but it can fall by the wayside as easily as "Families First" has done with sickening irony in the province that maintains the worst child-poverty rates in the country. If there's anything that makes cogent sense in the BC Liberal agenda, it must be too unpalatably unethical to allow public illumination. We see the remainder---it never made sense and everybody, culprits and victims, knows it.

Expect more of the same---BC Liberals have been well beyond practical redemption since way before Christy came to power---more prancing majorette, more nose-thumbing the electorate, more absurdity. Christy's singular talent will be deployed only when it can, and as the next election nears, she'll remind her nervous party that they only won the last time by letting Christy be Christy, the supremely self-confident booster, the Princess Warrior. And if LNG doesn't look boostable enough, something else will do---it almost doesn't matter what, maybe even nationalizing BC Rail.

Ken Collins said...

As a "citizen" of welfare bc, I am struck with the "Alice in Wonderland" attitude of our leader! in this have not province. We need an election soon, BC cannot carry on as it is, pity.

Anonymous said...

"As a "citizen" of welfare bc, I am struck with the "Alice in Wonderland" attitude of our leader! in this have not province. We need an election soon, BC cannot carry on as it is, pity."

We are a 'have' province. We were a 'have not' province when the NDP was in government.

The next election will be in 2017.

Enjoy the wait.

Non Anon DPL said...

Anon 13 Oct 14:00 confuses his comment about BC being a have province. Should read:We have been had again"

Anonymous said...

B.C. is a have province.

For a time when the NDP was in government BC was a have not province.

Interesting line "We have been had again".

Probably but the line means we were had when a previous government (not the BC Liberals) existed (as in the NDP), so the statement is valid. We were had by the NDP and yep a time we were had by the BC Liberals. So there's balance.

John's Aghast said...

If Chrispy had a straight flush she'd probably fold, unless the backroom boys told her what to do.
I went to UBC, took up Engineering and became an engineer (Civil '65) Chrispy went SFA and took up Space, and became a Space Cadet?
Neither one of us is fit to play a hand with PETRONAS. She needs help! Big time.

Anonymous said...

Looks like a engineer has too much time on his hands.

Anonymous said...

http://www.theglobeandmail.com/news/british-columbia/ship-carrying-450-tonnes-of-fuel-adrift-off-bc-coast/article21147767/