Canada chases Japanese LNG customers

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From the WSJ:

Advisers for liquefied natural gas projects on Canada’s west coast recently passed through Tokyo on an Asia tour to drum up interest for the projects in the energy-hungry region.

Joseph Bevash, a partner of Latham & Watkins, acknowledged that less costly LNG projects in other countries could undercut 16 projects proposed in Canada, but added that other advantages should not be overlooked.

…Mr. Bevash said most of the U.S. projects are conversions of existing LNG receiving terminals, so they already have a lot of costly infrastructure in place such as berths, tanks and pipelines…But the Canadian projects have the advantage of being geographically closer to Asia, he noted. It takes three days less to deliver LNG to Japan from British Columbia compared with from the U.S. Gulf Coast, and there is no need to pass the Panama Canal, meaning shipping costs are significantly lower.

If Canada were to develop its top two or three projects it could undercut Australia. Beyond that it would be risking the same input cost inflation that has destroyed Australian energy competitiveness to go further.

About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.