Thursday, May 22, 2014

Petronas Pushes for Province to consider LNG taxation plans carefully and quickly

The cool temperatures on the North Coast this week aren't all from weather patterns, with a speech at the opening session of the LNG in BC conference providing for a bit of a shiver for those on the North Coast hopeful of an economic boom based on LNG development.

The Malaysian Energy Giant Petronas, which is the leading proponent at the moment for LNG terminal development on the North Coast issued a warning of sorts to the Province on Wednesday. Outlining how delays in the tax regime to be put in place by the BC Government may derail the LNG industry in the province before it even gets off the ground.

Speaking at the LNG in BC Conference in Vancouver, Petronas CEO, Tan Sri Dato Shamsul Azhard Abbas suggested that British Columbia did not want to follow the path of Australia, which saw its percolating LNG boom begin to cool off in recent years. Mainly over delays and differences of opinion between the government and LNG proponents. As well as the increasing cost of doing business for LNG firms looking to operate in Australia.

During the course of his presentation, the Petronas CEO reviewed the timeline that his company has when it comes to making a final decision on the Lelu Island project later this year.

But he stressed that the decision will be based on whether it makes economic sense.  Suggesting that one of the outstanding issues that Petronas officials are keeping  an eye on is the Province's plans in the way of taxation on LNG.

In his Wednesday speech, the CEO offered up a gentle nudge that the Provincial Government needs to sharpen its pencils a bit when it comes to their thoughts on taxes, otherwise they may be putting their dreams of LNG development in peril.

Some of the reviews of the warning shots from Petronas can be found below:

May 22-- Petronas' CEO has warning for B. C.: don't fumble LNG like Australia did
May 21-- Petronas CEO warns BC against 'unrealistic expectations' on LNG
May 21-- B. C. told to release LNG tax regime or risk losing Malaysian business
May 21-- Petronas Says Canada Must Avoid Australia mistakes in LNG
May 21-- Petronas warns Canada not to slaughter its LNG 'Golden Egg"
May 21-- Petronas says Canada gas stocks halfway to goal for LNG investment
May 21-- BC's new LNG tax system still up in the air

The PacificNorthwest LNG project is considered to be one of the leading prospects for LNG development in Northwest BC, having made much preparation work already towards their final investment decision of the fall.

You can find more on the plans for the PacificNorthwest LNG terminal at Lelu Island from our archive page.

For a full review of developments at the LNG in BC conference see our items here and here.

Update:  An audio file via Soundcloud is now available of the speech Wednesday from the Petronas CEO, you can listen to it below:

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