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Gold/Mining/Energy : Big Dog's Boom Boom Room
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evestor
isopatch
To: zebra4o1 who wrote (184207)6/2/2014 4:11:26 PM
From: Dennis Roth2 Recommendations   of 206176
 
I don't get this analysis. Is this Russian gas new supply? Isn't it just gas that was previously being piped to Europe? Won't the Europeans now have to buy from somebody else?
It's new supply. The Chinese will finance the development of the Chayanda and Kovykta fields in Eastern Siberia and the pipeline by prepaying for gas. The Russians will pay them back in gas. Europe is supplied by existing Western Siberian fields.
It will also make Russia's “Power of Siberia” gas pipeline and Vladivostok LNG (“VLNG”) economic, as this Citi note ir.citi.com explains. That's more LNG supply in the Pacific.
I see it more as a threat to B.C.'s LNG dreams as they are going to be late to the Pacific LNG party.
Australia's LNG projects are already underway and coming on line.

The Chinese will never allow themselves to become as dependent on Russian gas as the Europeans have.
They are too clever for that. They are lining up supplies from all over.

Even if the Russians were suppling the Chinese from Western Siberia, it wouldn't cut into European supplies.
Russian gas production is not resource constrained, but market constrained. It's contained by how much the
world is willing to buy from them.
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