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The cupboard is bare - LNG royaties are missing in action.
17 Oct
Why Qatar beats Australia in the #LNG royalty olympics

Are the Australian people getting their fair share of the value of their LNG exports? From Down Under comes this latest fizzle, an argument that could pit the resource owner, whose coffers could well be empty relative to the next biggest national exporter, against the resource producers, who have run up huge costs to get into the LNG game by following the rules set by the owner.


Who’s right? Let’s let some high-price Canberra lawyers make the case, but as a public service to the Canadian and African projects, here’s my views on the matter.


The cupboard is bare - LNG royaties are missing in action.
09 Mar
Australia’s Incredible Shrinking LNG Royalty
 This week's post is from my colleague and friend John Bland, on the topic of taxes and royalties in Queensland's emerging LNG export industry.  Oil prices have been on a tumble for several months now. Since contracted LNG is often priced with reference to oil (unlike LNG available on the spot market, which is based on what buyer and seller agree), it means LNG prices are also falling. But what about the taxes that Australian governments collect from the gas sector? Will those taxes be less than planned?  
Inpex Ichthys Long View 1
27 Jan
Phoenix Rises. A Different LNG Industry Takes Shape
 Queensland's LNG projects have been on a bit of a rough ride of late. Take over talk, hostile investment bankers, sour ratings agencies, poor spot prices, low oil prices, high cost, low productivity, no buyers, looming competition - what's an LNG executive to do? Here's an idea: rethink the business model and change the shape of the industry
March 2015
03 Nov
LNG News and Analysis – October 2014
Here’s my analysis of the most interesting news from the world of LNG and natural gas from the period October 1-31, 2014. 

Methane A Questionable Solution To Climate Woes

Several stories this month on the ongoing debate about methane as a solution to climate change. This story, in the important journal Nature, concluded that low priced gas will displace high carbon fuels (oil and coal - good), but also high priced lower carbon alternatives (solar, wind and nuclear - bad), and will also drive up demand for gas as we simply consume more of it in everything and everywhere (growth in demand - bad). On balance, therefore, gas is bad for the climate and we need some policies to alter the outcome path we're on. So the policy requirement is how to offset the two bads without upsetting the one good. One clue to the puzzle is that this is a battle between extracted fuels (gas, coal, uranium) and technology (batteries, solar, wind). Therefore, policies need to favour technology advancement over extractive industries without actually halting the shift from coal to gas. How hard can that be?
25 Aug
How To Tax Australian LNG?

 Tax authorities are taking interest in Australia's LNG exports


The art of taxation consists of plucking the feathers from a goose so as to obtain the largest possible amount of feathers with the smallest possible amount of hissing. Jean-Baptiste Colbert
 The Australian Taxation Office (or ATO) is getting interested in Queensland's LNG industry. As the projects move ever closer to exporting LNG, the tax authorities are gearing up to determine the taxes to be paid on Australia's export bounty. At first blush, it's odd to be contemplating the royalty and tax questions at this stage. After all, the price of Australian LNG is presumably already agreed in the contracts with the end customers. And the export LNG price is calculated with reference to the price of oil (there being no other easy way to determine the price). And the tax and royalty calculations are likely enshrined in some dusty document somewhere. In theory, perhaps we need only to look at the many conveniently published oil price indexes to get a good idea about the price of LNG and from there the royalty take. And corporate net income can be the basis of determining an overall income tax. But it's not that simple. And there are many interested parties in the price of gas and LNG. Let's unpack this problem. 

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