An Algerian gas deal. Lovely.
Elve Central at Labour HQ has found a lethal weapon and is sharing it on Facebook today.
That’s what happens when you put people to work who have absolutely no background in anything at all, and who don’t understand the implications of what they think is a GOOD piece of information.
The weapon in question is a link to a report in the Turkish daily Today’s Zaman:
TURKEY SIGNS 10-YEAR GAS DEAL WITH ALGERIA
Oh, and there’s no mention of a fixed price, either. Only Labour can come up with something like that.
This is supposed to be ‘proof’ that 10-year gas deals are possible, and to save Konrad Mizzi from doing so himself.
Are they insane?
You have to be utterly nuts to push this as something good, right in the middle of one of the worst hostage crises the world has ever seen: at an Algerian gas plant.
The news media are all agog with the story, gas prices are rising as a result, fraught relatives of the hostages are being interviewed, the French are a ball of tension, and David Cameron has told his people, via the BBC, to “prepare for bad news”.
And Labour thinks that this is a really good moment to let slip the information that it plans to get a gas deal from Algeria, bringing the stuff in on ships, because they never wanted to join the EU and they’d rather have that than pipe in the gas from Sicily.
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http://www.todayszaman.com/newsDetail_getNewsById.action?newsId=303247
Well, this deal most probably was done to ensure that Turkey gets the supply it requires, but as you clearly say no mention of price fixing is made.
If anything, this article shows that not only fixing the price is highly unlikely, but even securing the supply required is an issue, and with the sudden move to gas we might start to see a ‘war’ in agreements between the big consuming countries, similar to the current oil deals, with China financing African dictators to secure supply.
You’re good! Somebody on this island sees the picture.
Not only is the the price at which the deal was made key to the whole issue.
There’s another fact about this deal that makes it totally irrelevant to our situation:
This deal speaks of 4 BILLION CUBIC METRES PER YEAR OF LNG FOR A 10 YEAR PERIOD, equating to a deal for the secured supply of 40 BILLION CUBIC METRES OF LNG.
Now, with a monthly shipment to keep Konrad’s tanks full, we require an estimate of 720,000 cubic metres of LNG per year. That means that Konrad would want to strike a deal for the secured supply of a total of 7.2 million cubic metres of LNG (60,000 x 12 x 10).
I don’t know about you, but for me if I’m buying 5555 times less than what Turkey would be buying, I expect the price Algeria would ask me to pay would be higher. Much higher.
This apart from the fact that that report, as you correctly state, does not speak of price. It only speaks of secured supply. We have no idea whether the price would be fixed or allowed to fluctuate within agreed limits.
Trust idiots to argue:
“You see! A 10-year contract for the supply of LNG!”
Well, as long as it’s for 10 years …
By the way, if Konrad, being promoted by the LP as an expert in the field with so many possible contacts in the company that employs him as consultant, has not managed to find a relevant contract and plaster it on 1234 billboards all over the island, no Elf will ever manage to dig one up.
Well, he already answered that. He already said there is no need for him to provide it as you can Google it yourself.
Do these people read/watch the international news at all? Is Super One or Maltastar carrying the Algeria story?
You can always get a 10-year price deal – at a price that factors in all the uncertainities in this world – and that would be a very hefty price indeed.
Admittedly, the price could be staggered – so much in the first two years, then a step up etc but the overall long term price would still be much higher than one hedged in the short term.
Any bets that Cyprus Joseph will come out with this this evening on Xarabank without reading it.
I honestly thought that Labour actually started to think things through, after spending so much time on the opposition benches. Then again, the “elves”, as you hilariously describe them, cock up.
This is an extension of the oiginal deal signed in 1988, and not at all like Labour’s hunt for new deal now.
http://allafrica.com/stories/201301080080.html
Daphne, you’re giving elves a bad name. We all saw what lovely people they are in the Hobbit and Lord of the Rings films. I’d prefer if you called the Labour minions trolls, please.