A86 - The Terrace Standard, Wednesday, September 25, 1996 _BUSINESS Gas buyer signed Pac Rim LNG lands $12 billion deal, hits high gear A TENTATIVE deal reached with its biggest customer has sent Pac Rim LNG back into high gear to get financing for its $1.4 billion tiquid natural gas porject and pick a site in either Kitimat or Prince Rupert. . Pac-Rim announced last week the buyer it has been wooing, Korea Gas, has signed a letter of intent to buy 3.5' million tonnes per year of LNG on a Jong term:contract. Sales are ex- pected to lotal around $12 billion over the 20 ycar life span of a contract, They hope to have the sales contract finished by the end of the year, Company vice president Wayne Stanley said that letter gives them the leverage to move ahead on securing natural gas supplies, re- initiating government approval processes and building its financing package, He added they were in a ‘‘chicken and egg’? standolf for a while, because potential gas sup- pliers wanted to see a clear indication Pac-Rim would get a contract before talking about supp- ly. Meanwhile the Korean buyers wanted to know Pac-Rim would have firm supplies before offering up a letter of intent. “We now can go (to suppliers} wilh a more straightforward business proposition, without a lol of uncertainty about whether or not the pro- ject is going ahead, that (has been) essentially taken off the table,’’ Stanley said. Pac-Rim will also have more credibility with which to ask the provincial and federal govern- ments to commit to the environmental review and National Energy Board approval processes, The company’s next step will be to decide where the $627 million gas liquefaction plant security firms merg THE TWO MAIN security firms in town have joined forces. Lockport Security Ltd. has closed its Lagelle Ave, office and shifted its op- erations into Tolsec Canada Inc.’s Keith Ave, building. The arrangement ends the main source of competition for Tolsec, Lockport president Joe Suilivan, a former Tolsec employee, had struck “out on his own in 1990 to form the rival security compaay.. eo ‘Now he rejoins Tolsec as sales man- Pe eee . # goes: Kitimat or Prince Rupert. Stanley said formal talks to secure a site for . the plant aze now a top priority. One possibility is Biche Bay, about 10 km south of Kitimat on the Douglas Channel. It is Haisla Indian Reserve land and Pac-Rim offi- cials will sit down with Kitamaat Village coun- cil representatives to talk about what the compa- ny can pay in terms of a long term lease, and what other benefits might go along with the pro- ject. The company will have similar meetings with city and port officials in Prince Rupert over a potential site on Ridley Island. Pac-Rim wants to get the decision over with quickly so they’re not duplicating work on the environmental assessment process. Pac-rim is aiming to start construction of facilities in the spring of 1997 with a comple- tion date in late 1997. Facilities include the li- quefaction plant, storage facility and shipping dock as well as a dedicated natural gas pipeline, ata cost of $300 to $500 million. The plant will super-cool 500 million cubic feet per day of natural gas, turning it into liquid gas, which can be transported by ship to Korea. The project is expected to generate 3,000 per- son years of employment during construction, culminating with 100 full time jobs at the plant. On the environmental side Pac-Rim will be working to write its project report, addressing the specifications drawn up by the commitiee overseeing the review under the provincial En- vironmental Assessment Process, The report is a requirement under the second phase of the En- vironmental Assessment Act, TOGETHER AGAIN: Lockport Security president Joe Sullivan rejoined Charlie Graydon and Tolsec Canada Inc. after six years in competition. € operations @ On stage KITWANGA ARTIST Valerie Morgan is at the Northern Lights Studio tomorrow eve- ning for a showcase of her gorgeous handcrafted leather fashions, such as this black and red form-fitting dress. Morgan, who is Gitxsan and Kwakiutl, brings to- gether elements of her culture to design a wide range of clothing and jewelry. Out & About ICG plans cuts TWO CLERICAL positions are being cut in Terrace as part of an ICG Propane move to restructure its operations, get out of retail sales, and focus strictly on propane sales and distribution. The change takes place at the end of October, but branch spokesman Ken Weir said both affected Terrace employ- ees have already found other employment outside ICG. The local clerical positions have been replaced by a satellite link from local propane trucks to a computer al a company office in Vancouver. Data is transmitted auto- matically from the trucks and the Vancouver computer generates invoices. Where left meets right ONE OF THE newest members of the Terrace and Dis- trict Chamber of Commerce is the Terrace Women’s Resource Centre. The centre’s Karla Hennig said she believes it’s the first B.C. women’s centre to join a chamber of commerce. Hennig was initially reluctant to say why the centre joined, but later said it was primarily for the benefits pack- age chamber membership conveys. ‘“Or maybe we are in- filtrating them and we're just not telling you,’’ she added. Chamber manager Bobbie Phillips said it’s not unusual for non-business groups to join. Muks-Kum-O! Housing Society, the Kermodei Friendship Society and Terrace and District Community Services Society are also members. Membership benefits include Visa and Mastercard group discounts, group insurance options, a Westel long distance discount plan, and access to advertising promotions — in addition to the networking benefits membership provides.. Phillips says membership has been surging over the past year, adding they've now reached 335 members, on ager for the firm’s western alarm divi- sion, “I guess ’'ve come full circle,”’ Sullivan said. He said having two security firms in town was good because the competi- lion taught both companies to provide good service to the customer. But in the long run, he said, it did not make economic sense to maintain two separate operations. “Pooling both companies’ resources logether now will only help the customer,”’ Sullivan added. Sullivan said it'll also allow him to specialize more than he had when he was running the smaller firm. “For me it was bittersweet,” he added. ‘But I felt it was the right thing to do at this time.’’ Some of Lockport’s 14 staff have come over to Tolsec, others won’t be, says Tolsec’s Ed Graydon. Dollar Cost Averaging “"We don’t want to have too much duplication,”’ he said. ‘“But we're tak- ing of a5 Many as we can.’” Sullivan will continue to service the former Lockport customers and their systems under the Tolsec banner. Tolsec is the largest security firm in northern B.C. and has evolved rapidly in its 24-year history with dramatical- ly changing technology. YOUR COLLEGE IN “YOUR COMMUNITY. Ploying the finonciol markets as if they’re a cropshaot in a Las Vegas casino or ming to “heal the morkels” fo make o financial killing ore both unwise and unlikely. A more sensible approach to investing, recommended by many financial advisors asa meons of protecting investors from a capricious economic world, is called “dollar cost averaging”. Dollar cost averaging is the investing af a fixed amount of monay in an investment, a mutual fund for example, at regular intervals - such as S100 per month. By following this strategy, investors will octu- ally lower the average cost 0 their investments, I you have lower costs, then you have mare prafit. The principle of this strategy is simple Since financial marke prices Tluctuate, individuals that invest once o year may find the value of their invest ment either rises, falls or stagnates over o period of time. But, with dollar cost averaging an investor purchases consistently, without having to guess when to invest. you buy o fewer units when the price is high and more units when the price is low. For example, you decide fo invest S100 a month ino mutual fund. The firs! month the fund's units cost $10 each - so your $100 buys 10 units. During the next four nants, the fund's price per unit rises to $11; drops to $9; ond then 58.- Over the four- month period your $100 a month is invested of these differant prices so you purchase 42,7 units - or 2.? units more than if you had invested a lump sum of S400 ot $10 per unit, which would have given you only 40 units, Because the investor who used dollar cost averaging has more units, they hove more profit. The odvantage of dollar cost averaging is thel investors don’t fave to invest a large amount of money all af once or worry cbout timing the markel, There is no need fo sludy trends - attempting 10 determine when to buy, ond where the unit value will be tomorrow, next month, or six months from now - becouse investors ure buying units consistently ond fluctuations in the market balance theniselves out over time. Furthermore, dallar cost averaging eliminates the temptation to stop buying when the unit price oes down in value or to invest wildly when units Besin rising in value. In short, investors using dollar cost overaging are fallowing the classic advice of buy low and sell high. Here's an example of dollor cost averaging when prices ore fluctuating down and up. Let’s say you invested $100 a month over o six month period. During the first month the unit price wos $15 - you bought 6.66 units. Over the next six months, the price swung wp and down, reaching as high as $14 and falling os low as $12, and finally returning ta $15. The following table illustrates the investment: Amount — Total Invested Value Month Unit Units Prite Sought l SiS. 6.667 = S100 $100.00 2 S19 7.692 S100 $186.67 3 $4 7143 $100 $301.03 4 S12. 8.333 S10D. $958.02 5 Sl6 6.250 = S100 ($577.36 6 S15 6.667 = $100 $641.28 As illustrated, yaur $600 invested over six months is now worth $641,28 - a gain of 6.9 per cent. If you had made a single $600 investment ot tha some time as Month One, you would still only have $800 at the end of the six-month period. Thus investors using dollar cost averaging have come oul ahead. Dolor cost averaging is offered by many mutual fund companies. Talk with your mutual fund specialist today to learn more about the advantages of dollor-cost-averag- ing investments. In the long run, it could make you o winner. 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