Dear Editor:
Let's not get too carried away over the news that Pacific NorthWest LNG, a consortium headed up by Malaysian's state-owned energy giant Petronas and Japan Petroleum Exploration Company (Japex), plans to spend up to $16 billion to export liquified natural gas out of Prince Rupert to the Asian market. It's far from being a done deal.
According to Pacific NorthWest LNG, a feasibility study (FEED, short for front-end engineering design) won't be completed until August 2014. And it wont be until the end of 2014 that "the final investment decision on the project" will be made by Petronas and Japex. A likely major element of that decision will be gas pricing. Until now, Asia has been paying a premium for gas mostly because, unlike North America, the price is indexed to oil. And, of course, there is a very real shortage of natural gas deposits on that side of the world. Japan, for example, continues to be the largest importer of LNG, more so these days as it moves away from nuclear energy. It's not surprising that, as expressed by Japex managing director Mitsura Saito recently, they'd like to "work on ways to lower gas prices."
If LNG Minister Rich Coleman or the premier took note of that comment, they gotta be wondering just what the future holds vis-a-vis their grand plan to use LNG royalties to render B.C. debt free in 15 years.
Bill Brassington, Burnaby
