Geez, that old LNG terminal idea didn’t last long, did it? Seven weeks - that’s it. From the moment it was announced on February 9 to the first knife stuck in it today, seven weeks to the day.
Now, before you come at me arguing that the LNG terminal hasn’t been killed - yes, it has. It is dead. The Herald report this morning that multiple ministers are privately admitting they may have to kill the project did not happen by accident.
This is Politics 101 when you’re winding something down. You start slowly and by the time you actually kill it - say in two or three months - people have already got used to the idea.
Then factor in that the Prime Minister was on Mike Hosking Breakfast this morning and didn’t sound super enthusiastic. That, I think, backs up the suspicion.
Now, if you wanted to pull me up on anything, it’s that it’s not 100 percent dead. There’s always a chance something changes and it slips through. But today, I’d put the chances of death at 80 to 90 percent.
And it’s not for the reasons we’re being told - namely that gas prices are now too high because of Operation Epic Fury. We already knew seven weeks ago that an LNG terminal would be at the mercy of international gas prices.
That was one of the main warnings about the idea. At the moment, we pay domestic gas prices. The minute you start importing LNG, you’re paying international prices.
The real reason this is being cut is because it was never a good idea. And I think they had to run it out long enough to truly realise how many people thought it was a bad idea. Spending $1 billion on what is essentially a short-term fix is a hell of a lot of money - and that’s assuming it comes in on budget. Given what we know about infrastructure projects in this country, it could easily cost a lot more than $1 billion.
And it is a short-term fix. Unless we suddenly strike a big gas discovery in the next few months, this country is going to have to wean itself off gas. You’re going to have to stop using gas and start using something else - probably electricity in homes and something different again for industrial and commercial users.
Storing gas in a terminal was only ever about managing the transition while we moved away from gas. That’s an enormous amount of money to spend on a transitional solution.
On top of that, forcing people to pay for it through an LNG levy was political toxin - especially during a cost-of-living crisis. So now you’ve got double political toxin, in a cost-of-living crisis that’s just been supercharged by a war in Iran.
So consider this one already dead - because it was never a good idea in the first place.
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