Encana PetroChina form joint venture to develop natural gas in Alberta

PetroChina has already paid $1.18-billion to Encana, with the remainder being stretched over the next four years. The two companies plan to invest about $4-billion in the project over that time.“This joint venture will build a foundation for the successful development of the Duvernay play and help to diversify our business portfolio,” said Pheonix CEO Zhiming Li.“Encana is our ideal long-term partner for the development of our future natural gas business.”Encana and PetroChina have a history: an earlier $5.4-billion joint-venture deal for Encana’s lands in the Montney region fell apart in mid-2011 after they failed to see eye-to-eye on how that project would operate.Encana has been inking several joint venture deals in recent years so that it can develop its huge resource base more quickly than would otherwise be the case.The cash injection from deep-pocketed partners has helped Encana cope with persistently low natural gas prices.Encana shares rose 2.3%, or 47 cents, to $20.91 in Thursday afternoon trading on the Toronto Stock Exchange.Encana has drilled nine wells into its 445,000 acres (180,100 hectares) in lands in the Duvernay, where numerous companies have amassed large land positions through government land sales and takeovers.In October, Exxon Mobil Corp. agreed to spend C$2.6 billion to take over Celtic Exploration Ltd., which has extensive acreage in the region.A study by the Alberta Energy Resources Conservation Board and Alberta Geological Survey said the Duvernay formation, which extends through much of central Alberta, contains 443 trillion cubic feet of total gas in place, 11.3 billion barrels of natural gas liquids and 61.7 billion barrels of oil, putting it on par with some of the continent’s largest shale prospects.The Canadian Press, with files from Reuters “I think Prime Minister Harper was clear that Canadian was still welcoming foreign investment,” said Geoff Hill, a partner at Deloitte’s Calgary officer.“Where he was also clear was that control and complete ownership, especially by state-owned enterprises, would be much more difficult.”Encana estimates there are nine billion oil-equivalent barrels initially in place on its Duvernay lands, which are rich in valuable natural gas liquids. It will remain operator of the project.It is a strong endorsement of Encana’s position as a reliable long-term partner“Phoenix’s investment demonstrates the tremendous value that Encana has created in this early-life, liquids-rich play and enables us to accelerate the pace at which the full production potential of our Duvernay lands can be achieved,” Encana CEO Randy Eresman said in a release.“A transaction of this magnitude keeps us on track to create a more diversified commodity portfolio and maintain our balance sheet strength. It is a strong endorsement of Encana’s position as a reliable long-term partner.”Ted Rhodes/Postmedia News files CALGARY — Less than a week after Ottawa waved through CNOOC Ltd.’s $15.1-billion takeover of Nexen Inc., a different Chinese state-owned company is plowing another $2.2-billion into the Canadian oilpatch.Natural gas giant Encana Corp. and a subsidiary of PetroChina announced Thursday they have reached a deal to work together in the Duvernay, a promising shale natural gas formation in west-central Alberta.PetroChina will end up owning just shy of half of the 180,000 hectares Encana has in the Duvernay, which means the deal won’t be subject to the same federal review as the Nexen deal.In announcing the Nexen decision — as well as a green light for Malaysian state-owned firm Petronas’ takeover of natural gas producer Progress Energy Resources Corp. — Prime Minister Stephen Harper stressed that those types of deals would not be the norm.Click to enlarge read more

Australian green activists under the tax spotlight

first_imgThe Minerals Council of Australia (MCA) has welcomed the report by the House of Representatives Standing Committee on the Environment into the register of environmental organisations and urges the Turnbull Government to implement its recommendations.In Australia, registered environmental organisations are entitled to receive income tax deductible gifts and contributions, just like public hospitals, volunteer fire brigades and registered public benevolent institutions.Brendan Pearson, Chief Executive, MCA explains that “while the report recognises the important conservation work carried out by the majority of registered environmental organisations, it also provides substantial evidence that a minority of groups are misusing tax-deductible donations to fund or carry out activities that are unlawful, unsafe or politically partisan.“The report notes that a number of industry associations and companies, as well as the police forces of NSW and Victoria, submitted evidence of protest activity by registered environmental organisations that has ‘involved series risks to the safety of employees, volunteers, and other members of the community.’”The MCA considers that the bipartisan recommendations made by the House of Representatives Standing Committee on the Environment will help reassure the public that tax concessions granted to registered environmental organisations are being used for their intended policy purpose.“In particular, it is appropriate that the Australian Taxation Office (ATO), rather than the Department of the Environment, administer the endorsement process, as the ATO has the expertise and resourcing to assess applications more efficiently and transparently.“It is also reasonable that environmental organisations seeking deductible gift recipient status must register as an environmental charity through the Australian Charities and Not-for-profits Commission. This change would ensure that all environmental deductible gift recipients, and not just those who are also registered charities, are clearly prohibited from pursuing purposes that are illegal or party-political.”It’s not okay for a charity to have a purpose to:Engage in or promote activities that are unlawful.Engage in or promote activities that are contrary to public policy (which, in this context, means the rule of law, the constitutional system, the safety of the public or national security).Queensland Resources Council Chief Executive Michael Roche appeared as a witness at one of the Australia-wide hearings last year, and said it was high time the light was shone onto the questionable activities of some green activist groups.“The myriad of evidence uncovered as a result of the inquiry reveals that some green activists – not all – may have been breaching the rules of the tax system,” Roche said.“Registered environmental organisations accounted for approximately $45 million in foregone tax revenue in 2013-14 alone,” Person said.He concluded that “these are moderate and bipartisan recommendations from the House of Representatives Standing Committee on the Environment.”The map shows the location of the proposed Carmichael coal mine which has been subject to serious environmental terrorism.last_img read more