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CONTRIBUTION · 15th February 2013
The Straight Goods
British Columbia`s Natural Gas Prosperity Dream, Smells Like Rotten Eggs

THE FOLLOWING ALL PROVIDED BY
"The Straight Goods" One might consider going direct for a better presentation of this material.

I was sure I read at one time. China has their own massive gas fields.

China has poisoned their farmland with heavy metals and cancer causing agents. The are also running out of clean drinking water.

Would this be why, China won't frack for gas in their own country? Just thought it strange Christy sold our n.g. to China, when they have an abundance?


Yes, China has gobs of natural gas..

This viral story laid it out..
http://powellriverpersuader.blogspot.ca/2012/02/chinese-tigers-playing-with-canadian.html

As for China isn`t developing their own gas(yet)..Why bother when you have a bunch of countries running around like chickens with heads cut-off, all willing to go low, and stay low..!

There are water issues in China, but as I reported, China is looking at desalination plants to turn salt water into fresh water, all for fracking..

And a massive Natural gas line has just been completed running from Kazakhstan to central China, that one pipeline alone will supply 600 million Chinese with Natural Gas..

China Tigers will continue to play with Canadian Sheep..





3 month graph above is for natural gas, chart also available at below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z02b0100azd2ba1473a91449f48b9b6ecc14b0dce2


The chart above is a 3 month price profile for the price of natural gas..

The next graphs on natural gas pricing will be as follows..

6-months.

1-year.

3-year.

5-year.

10-years.

6-months natural Gas chart available at below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z04b0100azc3d6d950159842bbb2eb3b368460a6ac


As you can see, the 3 month and 6 month pricing charts for Natural Gas has shown falling prices...


1-year natural as chart available at below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z06b00f0azea3ead83a2ab4c3985a7c509eef66f95



The above graph is a 1 year graph.. Pay close attention to the price of natural gas, and remember, the BC Liberal Government are claiming that they will, in the Asian gas markets get a price for natural gas/LNG at more than 5 times the highest price point in the above graph, Pat Bell is using $dollar numbers in the $15 to $18 dollar per unit range, the North America price for natural gas is currently(Today, February 14th/2013), just over $3 dollars).


3-years chart available at the below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z04b00f0az9d400d117fed49d0bcef646993574804

In March of 2010 the price of natural gas was in the $6.50 per unit range, what`s happened over that time? fracking, shale gas, new technology for extracting trapped gases in the earth are now being deployed widely, the secret(s) of extracting shale gas are out in the mainstream, worldwide, Natural Gas deposits are everywhere, China itself has a 300 year domestic supply, Russia is awash in natural gas in Siberia, a new pipeline from Kazakhstan directly into eastern China has just been completed, this gas line is advertised to supply natural gas to 600 million Chinese people alone, one pipeline with several spur lines, that is almost half of China`s population, the natural gas supplier for those pipeline is Kazakhstan and Russia, Canadian gas will never flow through that pipeline(s) system and spur lines......Why is that point important, it`s important because 50% of the Chinese market for our gas is already gone, it`s important because now we are racing Australia,....Australia, a country with a 5 year head start with processors, freezers and trains, the facilities needed for producing/freezing LNG, we are racing Australia who has a 5 year head start and half the Chinese market is already gone...


" The longest section of the Turkmenistan-Uzbekistan-Kazakhstan-China transit pipeline passes through Kazakhstan’s territory: it measures 1,115 kilometers in length, of the total 1,830-kilometer Turkmenistan-China distance. Kazakhstan is adding a dedicated export pipeline for its own gas exports to China. In combination, these developments (alongside planned oil exports) confer to Kazakhstan a major role in China’s energy security calculations.

Kazakhstan is currently transiting Turkmenistani gas to China at an annual rate that should approach 30 billion cubic meters (bcm) by December 2012 (i.e., set for the full calendar year 2013), plus small volumes of Uzbekistan’s gas in transit. The transit pipeline is planned to reach full operating capacity through the parallel Lines A, B and C at 65 bcm per year by December 2015 (presumably from the calendar year 2016 onward)"

tt_news=39758&tx_ttnews[backPid]=7&cHash=fd2b03dc794353c0fd214a4c74190948


Australia has spent $billions in natural gas and LNG infrastructure, they are years ahead of BC.

Russia is the world`s largest natural gas producer, and supplier, our American neighbors are going Fracking crazy, they too are swimming in natural gas, there are huge natural gas plays in Qatar, in Africa, let me repeat that, there are huge natural gas plays in countries where wages are a fraction of the Canadian wage, there are natural Gas plays everywhere, so it seems, yet our BC Government, Christy Clark would tell you that despite the cheap current American price, despite the world glut of natural gas, despite the fact that many countries are ramping up production, despite China having a huge domestic reserve of natural gas, despite of all that China will buy LNG for record prices for decades, there is no risk, those Chinese have so much money that they won`t mind paying 5 times the North American price, and all those other countries that are years ahead of us in LNG export facilities, all those countries will keep their price at 5 times the North American price for their Chinese customers, even though there is a glut, even though some country`s natural gas won`t be bought because of glut and over-supply, Christy Clark and Pat Bell would tell you that no one country would undercut the other and lower the price, and the Chinese won`t push for lower prices, those Asian natural gas buyers won`t want the lowest price in the world, no indeed, China the world`s soon-to-be largest consumer of natural gas and our Government would tell they can predict price, profit and royalties levels in this volatile market for decades ahead..Now that`s funny and unrealistic, it`s also not a sound business plan..



5-year Natural Gas chart available at below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z03b0100az923de419db3d4e71a0a7ce28cd619c66





You see that, back in 2008 the price briefly surpassed $10:00 per unit, it was also at this time when the BC Liberals last had surplus budgets, there was no good economic managing, it was resource revenue, the NDP had to deal with falling commodity prices and the Asian Flu in the 90`s, ..commodity prices between 2004-2008 were high, that is the only reason the BC Liberals ever ran surpluses...The point I am making is this, we have no control over commodity prices.

I guarantee you that China will receive a very favourable natural gas pricing, countries will undercut each other for market share, one only needs to look at the movie business, not just countries but even individual provinces and states within the same national unified country are undercutting each other, corporations pitting state and province against each other, the race to the bottom, a race controlled by corporate lobbyists and systemic corruption..

yet Christy Clark would have you believe that natural gas will never go that route, never drop in price overseas, the BC Government who have undercut other provinces and countries with tax/subsidy incentives many times themselves, all in the name of poaching business, and is not the Chinese Government the most corrupt business country in the world, kick-backs and bribery are common, not to mention very sharp pencils...



10,000 Corrupt Chinese Officials Took 120 Billion Dollars Out Of The Country
By Chris Oliver
Corrupt Chinese officials and employees of state-owned companies have absconded with about 800 billion yuan ($123.7 billion) of public money over 15 years through 2008, much of it making its way to the U.S., Canada, Australia and the Netherlands, according to Chinese news reports citing a central bank study.

The 67-page report, completed in 2008, was posted on the People’s Bank of China’s website this week, purportedly by mistake, and has since been taken down, although PDFs of the document are circulating in cyberspace.
In the report, which appears never to have been intended for public release, the PBOC estimated about 16,000 to 18,000 individuals have fled the country with ill-gotten funds over a 15-year period leading up to the report’s release, according to news-media accounts.

The PBOC focused upon where people went and how they got the embezzled funds out of the country.
One method, the study was cited as saying, was with the help of family or other trusted individuals who emigrated overseas, often using fake documents.

http://www.dotandcalm.com/index.php?option=com_community&view=groups&task=viewdiscussion&groupid=7&topicid=242&Itemid=124



China will not pay 5 times the North American rate, China will not sign decade`s long energy buying contracts at lucrative prices, China will precipitate a natural gas bidding war and anyone who thinks different is either delusional or has drank too much corporate koolaid,



10-year Natural Gas available at the below link.

http://apps.cnbc.com/cgi-bin/upload.dll/file.gif?z06b00f0az6d9b0cba42ff41888b742bc1e84e58d4





There it is/was, the peak high for natural gas was early 2007 /2008, it`s been a downhill slide ever since, I would also like to remind you that currently every country is broke, America, Canada, Europe, individual states and provinces and even Germany, everyone running deficits, even Alberta is running its 5th straight big deficit, interest rates at record lows for both banks and country..

The public, the consumer in both the USA and Canada have never been deeper in debt, consumer debt, credit cards, car debt, mortgage debt isn`t even included in that tally, wages are flat worldwide and every time we turn around another level of Government is digging deep in our pockets, property taxes, user fees, transit increases, insurance cost increases, it doesn`t end..

We have gasoline at the pump at near record prices, in a stagnant economy with flat wages there is not much room for higher fuel prices, and, there is hardly room in this weak economy to have domestic natural gas prices sky-rocket to new historic highs, 5 times the current price..

Because unless the North American price goes to $15 to $18 dollars, unless that happens China will never pay that price on a long-term basis with a world glut, with its own huge domestic supply, with many countries all fighting for a share of the same Asian market...

A recipe for disaster forecasting decades into the future, a recipe for financial collapse putting all our eggs into one fragile LNG basket of eggs..

http://powellriverpersuader.blogspot.ca/2012/02/chinese-tigers-playing-with-canadian.html

This post isn`t about pessimism against industry or business, this post is about reality, to count on $trillions in revenue from a industry not yet up and running, no long-term contracts, a world glut, attempting to forecast decades in the future is not only stupid and fantasy, it`s not a business plan, it`s a lottery ticket for a gambling game not yet in play..

Maybe as a province we can make money on LNG, done right on the right scale, but what is being boasted and fantasized about will collapse.

Just look to the movie industry, tax credits, subsidies, countries racing to the bottom, look at what corporations are doing, Air Canada and the Aveos betrayal, Caterpillar leaving Canada for cheaper labour, industry moving to the lowest tax jurisdictions, are we to believe the natural gas industry is any different, and if you were a country with a glut of natural gas but no customers what would you do?



P.S. --If any of the above charts vanish from this post merely click the corresponding link for each chart..Sorry about the difficulty with the charts..

You can go to the below link and peruse the advanced(Click advanced charts) Natural Gas charts, look at 3 months, 6 months, 1 year, 3 years, 5 years, 10 year charts, all the charts have one common denominator, Natural Gas has gone down in price.

Advanced charts below..

http://data.cnbc.com/quotes/%40NG.1

The Straight Goods

Cheers Eyes Wide Open
Natural Gas Charts
Comment by Grant G on 15th February 2013
Hello Terrace Daily readers, I apologize for the missing graphs..They are available at The Straight Goods.

Or if you click the very bottom link in this post, once there click the (advanced charts) ..

Once there you can summon the 3 month..6 month..1 year..3 year..5 year and 10 years graphs on natural gas pricing....

And for another good read on LNG future for BC, have a look at Bernard Schulmaan`s article, very revealing, and by the way, Bernard Schulmaan is no lefty, he`s a resource development proponent, he is however, also a realist..


http://bciconcoclast.blogspot.ca/2013/02/lng-some-inconvenient-truths.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+BcIconoclast+%28BC+Iconoclast%29