Who knows about the length and depth of the recession.
Here's what I think will play out though over the next few years. There will be LNG plants coming in at Gladstone, not as many as some people think because of the consolidations in the industry. But at least one to two will proceed while I believe may defer, or cancel due to economic conditions. Additionally I think that there is a lot of gas that is going to be available on the East coast from start up fields and projects, suppressing market price further. With a few LNG Plants coming on stream between 2012 and 2014; if the scenario comes to be then as painted above what you may see is some more consolidation in the market but they won't be the big fish swallowing the little fish, it may be two little fish getting together to survive.
I have seen these cycles come and go before but this one is unique and there are some people on this site and others that just look at LNG being bread from heaven, and once that happens all will be good for all gas producers whether or not they have participated in the construction of the plants. I don't see any panaceas out there, but some people are so naive that they think once this happens everything is lined with gold, it won't happen that way. Most gas producers will benefit but it will be becuase of a tightening spot market for gas when LNG comes on but will not receive huge price increases.
2009 is not going to be a real banner year for anyone.
Any way that's what comes out of this crystal ball.
Good Luck Daddy
BUL Price at posting:
14.0¢ Sentiment: Sell Disclosure: Not Held
