Alaska LNG exports proposed to fund Arctic icebreakers and ports
John Gallagher, FreightWaves, May 11, 2019
Revenues generated from Alaskan energy exports could be the key to closing a wide infrastructure gap that some assert has left the U.S. a decade behind its competition. Testifying on Capitol Hill on May 8, Mead Treadwell, an Arctic policy expert from the Woodrow Wilson Center in Washington, D.C., predicted liquefied natural gas (LNG) the “next big wave” of economic activity in the region that could help fund ice-breaking ships and deep-water ports. “[The Russians] are bringing 16.5 million tons of LNG from the Yamal [LNG project] through the Bering Strait [en route to Asia] 2,600 miles through the ice, while we’ve got big fields in Prudhoe Bay [Alaska] that are lying fallow” that would require just 600 miles through the ice zone, Treadwell asserted to lawmakers at a maritime subcommittee hearing in the U.S. House of Representatives.
Xi Jinping’s China: why entrepreneurs feel like second-class citizens
Tom Hancock, Financial Times, May 13, 2019
Born into extreme poverty in rural China, Liu Chonghua amassed enough wealth selling cakes to the country’s emerging middle class to build himself six European-style castles. Five are tourist attractions, but the grandest of all was designed as a home: a grey stone structure resembling Britain’s Windsor Castle, built on land the 65-year-old entrepreneur acquired from the government of the southwestern city of Chongqing in the 1990s. Mr. Liu’s tale is one of many rags-to-riches stories in China’s transition to a more market-oriented economy. When Hurun published its first ranking of China’s wealthiest people in 1999, it found just 50 with assets above $6m. The list now features nearly 2,000 individuals worth more than $300m — the tip of China’s sprawling private sector. Non-existent four decades ago, private enterprise today accounts for 60 per cent of China’s economic output and 80 percent of urban employment in 2017, according to official statistics.
Our Take: “The state advances as the private sector retreats.” Chilling.
From the Washington Examiner, Daily on Energy:
CHINA PLANS TO RAISE TARIFFS ON US GOODS, INCLUDING LNG: China retaliated against the Trump administration’s escalated trade war on Monday, with the country’s finance ministry announcing plans to raise tariffs on a range of U.S. goods to 20% or 25% from 10%. The list of targeted goods includes U.S. liquified natural gas, which will be hit by a 25% tariff. The strengthened tariffs do not include American crude oil.
China is delaying the implementation of the heightened tariffs until June 1, to provide time for negotiators. But industry officials have warned that Trump’s trade war with China is threatening to discourage the world’s fastest growing LNG market from signing long-term contracts with American developers.
Whereas oil is fungible, buyers of LNG demand long-term contracts, in the 20-year range. Other countries, including Russia, Qatar, Canada, and Mozambique can offer LNG at competitive rates, despite the U.S. cheap prices. China’s demand for LNG is soaring, and it is relying more on the U.S., which is expected to soon be a top three global exporter of LNG.